Mr President, the European Union has a cheap way of helping other countries: it guarantees credit granted by the European Investment Bank to these other countries. In practice such aid has not cost the EU anything in recent years. The recipients of loans have benefited from the guarantees as they have been granted loans at interest rates which are easier to bear than those that are granted on the basis of the much tougher market conditions. This cheap and effective method of assistance is regulated in the EU and there is a maximum amount for guaranteed loans, which is divided into regional envelopes. The Commission proposal now being discussed is to increase the envelope for the countries of Central and Eastern Europe, out of which the EIB can grant loans of up to EUR 8 930 million covered by an EU guarantee. In order to be able to provide financial support for the reconstruction of former Yugoslavia, it is desirable that that country be included among the recipients of loan guarantees. With that purpose in mind, it is being proposed that the Central and Eastern Europe loan envelope be increased by EUR 350 million. This amount is not being earmarked for former Yugoslavia’s use alone, but, after the increase, it will be able to receive loans out of this envelope of loans if it can show the EIB valid projects for its use. It is being proposed to grant loans to former Yugoslavia covered by a 65% guarantee. That is the condition of the guarantee generally in use and the EU has incurred no liability in respect of guarantees in recent years for loans granted in accordance with this condition. For the increase in the Yugoslavian envelope to take place there will have to be a transfer of funds from the EU budget reserves to the Guarantee Fund, although the increase in the envelope cannot be implemented in full during the current year. So the transfers will also have to be made over the next two years as former Yugoslavia finds suitable construction projects. In my capacity as permanent rapporteur for these matters I would, in this connection, like to express my concern that next year the Guarantee Fund will have no margin whatsoever for new and unexpected aid actions. Next year will be extremely problematic in that sense and the Commission must focus its attention on the problem of the overuse of the Guarantee Fund accordingly. The situation is further worsened by the Commission’s proposal for deliberation by Parliament regarding loans granted to Russia by the EIB in respect of environmental protection investments in the Baltic Sea basin. Quite incomprehensibly, the Council has demanded that a 100% guarantee be granted to cover these loans, in place of the normal 65%. The Council’s decision shows that there are Member States that want to hamper environmental cooperation with Russia. The way in which some Member States are acting in this connection is a display of ignorance of how the system works. Russia will indeed get its loan, but another country will not, as a 100% guarantee needlessly eats into the margin in the Guarantee Fund set aside for others. Increasing the envelope for the countries of Central and Eastern Europe for the needs of reconstruction in Yugoslavia is justified and there is no need to table amendments to the Commission’s proposal.

Political group: GUE-NGL