The European Investment Bank (EIB) is lending EUR 600 million for key investments in Latvia. The EIB targets social and economic infrastructure, education, training and promotion of entrepreneurship as well as transport, environment and energy.
On this occasion, EIB Vice-President Eva Srejber stated today: “In view of the importance of EIB lending to key infrastructure projects attached by EU leaders at their regular autumn summit in Brussels last Thursday, we are stepping up our efforts to strengthen the competitiveness of the Latvian economy and enhance the effective use of the EU grant funds allocated to Latvia. We are building on the excellent cooperation with the Latvian authorities and joining forces with the European Commission to support a large number of projects that in view of their relatively small size might not have direct access to EIB financing. Our tripartite cooperation maximises the efficiency and impact of our action”.
The EUR 500 million loan to the Republic of Latvia for priority investments co-financed with EU funds in the period 2007-2013 was signed today by Ms Eva Srejber and Mr Atis Slakteris, Latvian Minister of Finance, in Smarde, east of Riga, on the fringes of a conference on energy efficiency and sustainable urban development co-sponsored by the Ministry of Finance, the European Commission and the European Investment Bank, which is celebrating its 50th anniversary this year.
For energy efficiency in Latvia, the EIB signed in Luxembourg last week a EUR 100 million loan with AS Latvenergo for the modernisation of the power distribution network in Latvia. This is the fourth EIB loan to Latvenergo since 1996, when the EIB financed the rehabilitation of the Daugava hydropower plants. The EIB attached particular importance to this cooperation to ensure a reliable energy supply for Latvia’s citizens and the Baltic region as a whole.
Background information
In 2007 the European Investment Bank Group, the banking group promoting European objectives, continued its activities aimed at modernising the economies of the Member States and the countries close to the Union. The EIB Group provided financing of more than EUR 50 billion for projects promoting the European Union’s policy objectives. Finance for the EU-27 Member States represented 87% of its activities.
In the five-year period 2003-2007, the European Investment Bank lent a total of EUR 364 million for projects in Latvia. 42% of EIB lending in the last five years went to priority projects fostering the development of Latvia’s economic and social infrastructure, as well as projects in the fields of the environment and trans-European networks that are co-financed by the EU Structural and Cohesion Funds.
41% of the EIB’s lending in the country was for small and medium-sized enterprises (SMEs) and mid-cap companies (fewer than 3000 employees). The EIB funding was channelled through its established financial partners (DnB NORD Banka, Mortgage and Land Bank of Latvia, Hansapank, Nordea Bank and Sampo Banka).
In the energy sector, 17% of financing was directed towards securing sustainable energy supplies, reducing the burden on the environment and promoting the development of combined-cycle cogeneration plants. Financing to AS Latvenergo, the State-owned energy company, served to support the company’s investment programme, and in particular the replacement of the TEC-2 thermal power plant in Riga by a new state-of-the-art combined heat and power plant fuelled by natural gas. The new power plant has an electricity generation capacity of 400 MW and provides 270 MW for district heating, while meeting EU environmental standards. This is particularly important for contributing to the reduction of atmospheric emissions by improving generation efficiency.