The European Investment Bank (EIB) is establishing a new EUR 200 million loan facility for Estonia to support investments in research and innovation, sustainable transport infrastructure and the development of SMEs. The EIB loan will help Estonia to successfully absorb EU structural funds over the period 2014 – 2020.
“There’s no doubt that EU structural funds have already had a positive impact on the Estonian economy. We must continue to take advantage of these funds in the coming years” said Maris Lauri, the Finance Minister of Estonia, after signing the loan agreement with the EIB. She added: “Our aim is to take a long-term view and invest in building human capital and developing high value-added businesses. But these long-term investments require a lot of capital, even with the availability of EU funds, and that is why we value the on-going support of the EIB in providing long-term financing for projects that will improve Estonia’s competitiveness internationally, in turn creating more and better jobs.”
Pim van Ballekom, EIB Vice-President responsible for lending in Estonia, said: “With this support for key investments, the EIB is stepping up its efforts to strengthen the competitiveness of the Estonian economy and promote the effective use of the EU grant funds earmarked for Estonia. We are building on the excellent cooperation with the Estonian authorities and joining forces with the European Commission to support a large number of projects contributing to sustainable economic growth and a better quality of life for the people of Estonia.”
The EUR 200 million loan will be available as co-financing for selected projects under the Estonian operational programme for the Cohesion Policy Funds and the Rural Development Programme for 2014 – 2020. The EU structural funds will meet a fixed percentage of the costs of eligible projects, with the remaining part being covered from the State budget or by drawing on this EIB facility. The loan will primarily support projects in the following sectors: research, technological development and innovation; transport, water and environmental protection; and infrastructure development in rural areas. The facility will furthermore focus on investments in education, and health-care, as well as improving training and access to employment. These investments will contribute to the further development of a knowledge-intensive and internationally competitive economy, a clean environment and sustainable transport infrastructure, which in turn will help to create the conditions for smart, sustainable and inclusive growth.
This loan is a continuation of the sound partnership between the EIB and Estonia, with the Bank of the European Union having already lent EUR 550m under a similar EU funds co-financing facility covering the period from 2007 up to 2013. To obtain an EU grant for an eligible project, the government must provide the co-funding. While the co-funding will largely be provided from budget funds, the EIB facility will be available to supplement these funds and to ensure that Estonia uses as much of the available EU funding as it can.
The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. In 2009-2013, the EIB provided loans in Estonia totalling EUR 1.37bn.
Source: Estonian Ministry of Finance