EUR 14m to finance the upgrade of urban infrastructure and energy efficiency
First Polish town to benefit from direct EIB support under Investment Plan for Europe
Loan is key to helping the city address long-standing structural challenges
The European Investment Bank (EIB) is aiming to help a former mining town to turn the page of post-industrial decline and become an attractive place to live again, lending approximately EUR 14m (PLN 60m) to the City of Walbrzych for a wide-ranging investment programme to revitalise its urban infrastructure. This is the first tranche of a potential EIB commitment of up to EUR 28m (PLN 120m) for the city.
“Ensuring that no major city or region in Europe is left behind is one of the core objectives of the European Investment Bank”, said Vazil Hudák, the EIB Vice-President responsible for Poland and Cohesion countries. “For this reason, we support Walbrzych’s plans to revitalise deprived areas and renovate urban spaces and social infrastructure. Other former mining towns in Europe and Poland have found new life through regeneration programmes and Walbrzych could be the next place to achieve that”.
The President of Walbrzych, Roman Szełemej said: “Walbrzych’s economy was based on mining and other industrial activities for more than five hundred years, but this stopped in the 1990s, with a parallel shutting down of plants and out-migration of city residents. Since then there has been a partial recovery, nevertheless the city is still divided socially, geographically, and culturally. We cannot stay behind any longer. We just cannot afford to be passive, and we must search chances to help the city and our residents.The EIB gives us this opportunity”.
European Commission Vice-President Jyrki Katainen added: "By securing a loan from the European Investment Bank with the support of EFSI the residents of Walbrzych will feel the tangible benefits of this EU investment programme in their everyday lives in the form of improved roads, upgraded public spaces, more social housing, and lower energy costs due to more efficient buildings. I encourage other European cities to follow the example of Walbrzych to use the advisory services of the European Investment Advisory Hub in helping to put together their investment programmes."
With its 115 000 inhabitants, Walbrzych is the second city of Lower Silesia in Southern Poland, and ranks among the Polish cities that suffered most from the economic transition in the 1990s. The revitalisation program also includes energy efficiency measures, which account for around one third of the funds used.
Vazil Hudák praised the Investment Plan for Europe, also known as the Juncker Plan, for facilitating the financing. “This is our first loan to the City of Walbrzych and was made possible by the guarantee of the European Fund for Strategic Investments, which is the financial pillar of the Investment Plan for Europe”, he said. As such, the loan to Walbrzych is the first loan extended by the EIB to a Polish municipality with ESFI support. The project also benefits from the technical advice of URBIS (Urban Investment Support), under the European Investment Advisory Hub (EIAH), which is the advisory pillar of the Investment Plan for Europe.
Since its launch in November 2015, EFSI support in Poland has been gaining traction year after year. Overall, 60 EFSI transactions were approved in Poland by the EIB Group between 2015 and 2018. Total EIB Group financing eventually amounted to EUR 3.57bn, triggering some EUR 14.93bn of additional investment, making Poland the sixth largest EFSI beneficiary among the 28 EU Member States (relative to GDP). EIB Vice-President Vazil Hudák added: “I am particularly pleased to see that Poland’s public and private sectors both took advantage of the EIB lending and advisory facilities. The EU bank is a reliable partner for their long-term investment plans, which are a precondition for job creation and economic growth”.
Lending activity up 13% year on year in 2017 to over EUR 5bn. Since 1990 EIB has provided approximately EUR 65bn in financing to Poland, covering around 420 projects and investment programmes in all sectors of activity. New operations signed in early 2018 include a EUR 580m loan for road upgrading in south-east Poland (S19) and two loans to the City of Poznan for public transport and social housing projects (the latter under the “Juncker Plan”) for a total amount of over EUR 150m.
The EIB is signing a new operation ahead of its annual press conference in Warsaw: a EUR 91m loan for the upgrade of the university hospitals in Gdansk and Lublin. In 2018, EIB Group financing amounted to EUR 4.8bn, putting Poland in fifth place among EU countries in terms of funds received. Poland also ranks fifth in terms of loans backed by the European Fund for Strategic Investments. A record year (over EUR 1bn) for EIF portfolio guarantees reflects the soaring demand for financing from Poland’s innovative entrepreneurs.