EIB lending in 2020 amounted to €1.2 billion and EIF equity and guarantee commitments to €180 million
Some 8 000 businesses benefited from EIB Group operations, supporting approximately 147 000 jobs in the country.
EIB Group support represented 0.66% of the Czech Republic’s GDP
Last year, the European Investment Bank Group (EIB Group), which consists of the European Investment Bank (EIB) and the European Investment Fund (EIF), provided loans, guarantees and equity commitments worth €1.4 billion in the Czech Republic. The EIB Group maintained the high level of investment reached in 2019.
The EIB signed new loans amounting to €1.2 billion and the EIF committed around €180 million in 11 equity, guarantee and microfinance operations benefiting some 6 870 small businesses. EIF financing supported approximately 55 900 jobs and mobilised total investments of €1.3 billion.
EIB Vice-President Lilyana Pavlovacommented: “Despite the economic crisis brought on by the COVID-19 pandemic in 2020, the EIB Group kept a level of investment in the Czech Republic similar to that reached in 2019, which was already exceptional. Together with our Czech counterparts, we provided well-balanced support to the public and the private sector to increase the resilience of the economy and support a just transition. I am very proud that the EIB, as the EU climate bank, provided financial and advisory support to projects that will enhance vital infrastructure, energy efficiency and climate adaptation, and ultimately improve the quality of life of the Czech people.”
“Last year, the European Investment Bank also continued to support a number of important projects in strategic sectors, key to the future of the Czech Republic. And I am very pleased that the Czech private and public sectors have been able to make an active and effective use of this support. Projects delivered through the European Investment Bank in the Czech Republic last year helped around 8 000 small and medium-sized enterprises, thereby supporting more than 147 000 jobs. I very much appreciate this cooperation and I look forward to working together to develop and modernise the Czech economy again this year. Between 1992 and the end of 2020, the EIB supported investments totalling €23.2 billion. That is roughly CZK 600 billion," said Minister of Finance Alena Schillerová.
EIB Group results in the Czech Republic in 2020
Support for strategic regional infrastructure
In 2020, the EIB provided €122.7 million of loans to the Central Bohemia and Pardubice regions to support key regional infrastructure, healthcare, transport, social care, education, culture and the energy efficiency of public buildings.
EIB investments will help these regions to cope with current and future health, economic and climate challenges. They will help enhance the attractiveness of these areas and offer better economic opportunities and quality of life for Czech people.
Support for climate adaptation and the energy transition
Through a €300 million loan signed in 2020, the EIB will finance a vast set of measures put in place by the Czech Ministry of Agriculture to strengthen the country’s water management services, including flood protection and storm management. This is part of the Bank’s efforts to preserve natural resources and protect the environment for future generations.
The EIB support will help to improve living conditions for some 110 000 people in the Czech Republic. About 25% of the Czech population live in flood-prone areas that face disastrous floods on average every 10-15 years.
The EIB signed a €190 million loan to ČEPS, a.s., the state-owned Czech Transmission System Operator. This investment will help strengthen the country’s electricity transmission infrastructure, improving the reliability and quality of electricity supply, and increasing the integration of renewables in the electricity network.
Support for sustainable transport
In 2020, the EIB provided €223.8 million to upgrade freight and passenger rail transport in the Czech Republic. EIB loans will support the acquisition of 50 electric locomotives and 140 freight intermodal wagons, and the retrofitting of around 310 locomotives with the European Train Control System (ETCS) by CD CARGO, as well as the purchase of 37 new passenger trainsets by the South Moravia region.
These investments will improve the capacity, safety and quality of freight services and passenger rail transport in the Czech Republic, notably through the use of modern control and signalling systems.
By promoting a shift from road to rail transport, these projects will have a positive impact on the environment and support the country’s transition to a low-carbon economy, in line with the objectives of the EIB Climate Bank Roadmap and the Czech Republic’s transport policy.
Support for SMEs and mid-caps during the COVID-19 crisis
In total, EIB Group operations in the Czech Republic in 2020 benefited some 8 000 small and medium-sized enterprises (SMEs) and mid-caps, supporting over 147 000 jobs.
The EIB concluded €356 million worth of intermediated lending with four partner financing institutions (Moneta, CSOB Leasing CZ, Ceska Sporitelna and SGEF CZ), further improving the access of Czech SMEs and municipalities to EIB financing. These operations support investments that will primarily focus on helping Czech companies deal with the consequences of the COVID-19 crisis. Some 1 190 SME and mid-cap projects are estimated to benefit from EIB loans in the Czech Republic, supporting about 91 200 jobs.
The EIF committed a total of €180 million through 11 operations, aimed at raising €1.3 billion. Some 6 870 businesses benefited from EIF operations in the Czech Republic, supporting about 55 900 jobs.
The EIF provided guarantee top-ups under COSME to CMZRB, Moneta Bank and Komercni Banka. The COSME Loan Guarantee Facility (LGF) is a window of the Single EU Debt Financial Instrument, which supports European enterprises' growth and research and innovation (R&I). The EIF also provided guarantees to CSOB, Komercni Banka and Raiffeisenbank Czech Republic as a response to the COVID-19 crisis.
On the equity side, the EIF increased its stake in the Genesis Growth Equity Fund I and also invested in Enern Tech IV, a venture capital fund focusing mainly on early and early-growth stage ICT companies primarily in the Czech Republic and the broader region.
EIB advisory services in the Czech Republic
The mission of EIB Advisory is to help create and successfully implement sustainable investment projects by providing technical and financial advice to its partners across the project cycle and beyond. Advisory services in the Czech Republic are often delivered by multiple interdisciplinary advisory teams consisting of finance experts, engineers, and public-private partnership (PPP), innovation, climate and other specialists.
EIB advisory services help public and private entities to prepare projects that enable them to tackle some of the key challenges the Czech Republic and some of its neighbours are facing. Such projects support key investment in climate action, energy efficiency, digitalisation, innovation and social infrastructure.
In 2020, EIB advisory services provided:
Grant support to the Czech-Moravian Guarantee and Development Bank (CMZRB) to help it structure an advisory unit within the organisation. The unit will provide advisory services to Czech project promoters in areas such as transport infrastructure, digital and smart city solutions infrastructure, the circular economy, renewable energy and social infrastructure.
An assessment of the financing gaps for the agriculture and agri-food sectors in the Czech Republic, aiming to support the Czech European Agricultural Fund for Rural Development (EAFRD) in planning and programming the use of financial instruments for the 2021-2027 period.
€2.25 million of grants from the EIB’s European Local Energy Assistance (ELENA) to the investment programme of the Czech Ministry of Industry and Trade for a comprehensive energy efficiency renovation of the country’s central government buildings. The renovation will increase operational efficiency, improve energy performance and reduce greenhouse gas emissions.
Horizontal support in the preparation of projects under the Coal Regions in Transition Initiative in the Czech Republic, as requested by the Czech Ministry for Regional Development. Three Czech regions participated in the initiative – Karlovy Vary, Ústí nad Labem and Moravia-Silesia.
The EIB has worked with the Czech Republic since 1992 and invested in infrastructure, small businesses, environment and innovation. Since the start of operations in the Czech Republic, the EIB has provided €22.51 billion of financing to 185 projects.
Last year, the EIB Group, which consists of the EIB and the EIF, provided loans, guarantees and equity worth €1.49 billion in the Czech Republic. This represents a 110% increase compared to EIB Group’s results in 2018.
As part of a series of events organised to discuss current investment trends in different EU Member States, the Czech Banking Association and the European Investment Bank, in partnership with the Confederation of Industry of the Czech Republic and the Institute for Democracy & Economic Analysis (IDEA), hosted the webinar “Investment and investment finance in the Czech Republic”. It focused on investment needs and priorities for the Czech Republic in the era of COVID-19, digitalisation and climate change.
EIB Group activity volumes in the Czech Republic almost doubled in 2017 compared to 2016. The EIB has provided EUR 20bn in signed loans in the Czech Republic over the last 25 years. In future years the Bank will focus more on support for the public sector and direct support for corporates