Commission staff working document - Annex to the report from the Commission to the Council and to the European Parliament on borrowing and lending activities of the Community in 2007 {COM(2008)590}
Date: 2008-09-30
Institutions: European Commission
Subjects: Community loan, EIB loan, EU borrowing, EU financing, activity report

EN 

2007/ECFIN/021 

EN 

   EN 

 
COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 30.9.2008 
SEC(2008)2504 

COMMISSION STAFF WORKING DOCUMENT 

ANNEX TO 

THE REPORT FROM THE COMMISSION TO THE COUNCIL AND TO THE 
EUROPEAN PARLIAMENT ON BORROWING AND LENDING ACTIVITIES OF 
THE COMMUNITY IN 2007 

COM(2008)590 

EN 

   EN 

 
 
  
 
 
 
 
 
 
TABLE OF CONTENTS 

1. 

1.1. 

1.2. 

1.3. 

2. 

2.1. 

2.2. 

2.3. 

2.4. 

2.5. 

2.6. 

2.7. 

2.8. 

2.9. 

BORROWING ACTIVITIES IN 2007........................................................................ 4 

Trends in borrowing and lending ................................................................................. 4 
Borrowing of the European Institutions: outstanding at the end of each period (1)...... 6 

Borrowing of the European Institutions in 2007 by currency...................................... 7 

LENDING IN NON-MEMBER STATES................................................................... 8 

Lending in non-member States in 2007 – Overview ................................................... 8 

Loan disbursements for macro-financial assistance and Euratom to non-member 
States (2001-2007) ....................................................................................................... 9 

Signatures on EIB Own Resources in non-EU countries (excluding signatures on EIB 
own risk under Pre-Accession and Mediterranean Partnership facilities) ................. 10 

Sharing of Risks ......................................................................................................... 12 

EIB own risk lending ................................................................................................. 14 

Impact and value added of EIB external lending ....................................................... 14 

Performance indicators .............................................................................................. 15 

Support for EU policies.............................................................................................. 17 

Cooperation with International Financing Institutions .............................................. 19 

2.10. 

List of projects signed under mandate in 2007 co-financed with other IFIs.............. 22 

2.11.  Cooperation with the Commission............................................................................. 24 

2.12.  Contribution of EIB lending activity per geographical region................................... 27 

2.12.1.  Asia and Latin America ............................................................................................. 27 

2.12.2.  Eastern Europe, Southern Caucasus and Russia ........................................................ 28 

2.12.3.  Mediterranean Partner Countries ............................................................................... 29 

2.12.4.  Pre-Accession Countries ............................................................................................ 30 

2.12.5.  South Africa ............................................................................................................... 32 

2.13. 

List of loans signed under the Community-supported mandates in 2007.................. 33 

2.13.1.  Loans signed in Asia .................................................................................................. 33 

2.13.2.  Loans signed in Latin America .................................................................................. 33 

2.14. 

Loans signed in the Eastern Europe, Southern Caucasus and Russia ........................ 34 

2.15. 

Loans signed in the Mediterranean Partner Countries ............................................... 34 

2.16. 

Loans signed in the Pre-Accession Countries............................................................ 35 

2.17. 

Loans signed in South Africa..................................................................................... 36 

2.18. 

EIB lending in ACP/OCT in 2007 (including funding from own resources and by 
EDF)........................................................................................................................... 37 

2.18.1.  Breakdown by region (EUR million)......................................................................... 37 

2.18.2.  Breakdown by sector (EUR million).......................................................................... 38 

EN 

2 

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2.19. 

Interest subsidies paid under the various Community mechanisms from 1995 to 200739 

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3 

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1. 

1.1. 

BORROWING ACTIVITIES IN 2007 

Trends in borrowing and lending 

1997  1998  1999

2000

2001

2002

2003

2004  2005 

2006

2007

EUR million 

I. Borrowing 

ECSC(1) 

474 

- 

-

-

-

European 
Community(2) 

Euratom(3) 

Total 
Commission 

195 

403 

108

160

305

- 

- 

-

-

40

669 

403 

108

160

345

-

12

40

52

-

- 

- 

118

10 

15 

25

143

65 

75 

215 

230 

-

19

51

70

39

39

EIB  

23 026  30 098  28 355 29 038 32 172 38 016 41 911 49 865  49 807  48 050 54 725

23 695  30 501  28 463 29 198 32 517 38 068 42 054 49 940  50 037  48 120 54 764

Total 
Community 

II. Lending 

ECSC(1) 

541 

21 

-

-

-

195 

403 

108

160

305

- 

- 

-

-

40

736 

424 

108

160

345

-

12

40

52

118

10 

15 

25

143

65 

75 

215 

230 

19

51

70

39

39

22 958  25 116  27 765 30 644 31 184 33 443 34 187 39 661  42 276  39 850 41 431

23 694  25 540  27 873 30 804 31 529 33 495 34 330 39 736  42 506  39 920 41 470

European 
Community(2) 

Euratom(3) 

Total 
Commission 

EIB(4) 

Total 
Community 

(1) 

(2) 

(3) 

(4) 

The ECSC Treaty expired in 2002. 

Mechanism  for  providing  Balance  of  Payments  support  for  Member States  and  financial  assistance  for  non-
member States. 
The Euratom loans instrument is available for financings to Member States and certain non-Member States. 

Loans signed from own resources (with and without guarantees from the EU budget), no account being taken of 
the guarantees provided by the EIB to promoters. 

EN 

4 

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Graph: annual trends in borrowing and lending activities from 1997 (in EUR million) 

EIB Borrow ing/Lending

European Communities
 and EIB Borrowing and Lending Activities

EC Borrow ing/Lending

60 000

50 000

40 000

30 000

20 000

10 000

 0

750

625

500

375

250

125

0

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

EC Borrow ing

EC Lending

EIB Borrow ing

EIB Lending

Note: 

The  differences  between  total  borrowing  and  lending  by  the  Commission  are  due  to  borrowing  operations 
undertaken for refinancing purposes and to changes in the balance of loans not assigned by the end of the year. 

EN 

5 

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1.2. 

Borrowing of the European Institutions: outstanding at the end of each period (1) 

ECSC 

6 178 

EC 
(NCI)(4) 
1 747 

6 539 

3 269 

7 119 

4 432 

7 034 

4 960 

6 761 

5 202 

6 689 

5 229 

6 825 

5 514 

6 738 

5 122 

6 673 

4 542 

7 139 

3 817 

7 327 

3 326 

7 331 

2 202 

6 548 

1 570 

5 966 

1 113 

748 

218 

168 

130 

90 

19 

18 

16 

4 677 

3 637 

2 806 

2 432 

2 039 

1 386 

713 

431 

423 

440 

436 

400 

1982 

1983 

1984 

1985 

1986 

1987 

1988 

1989 

1990 

1991 

1992 

1993 

1994 

1995 

1996 

1997 

1998 

1999 

2000 

2001 

2002 

2003 

2004 

2005 

2006 

2007 

Euratom

1 272

1 680

1 892

2 013

2 168

2 500

2 164

1 945

1 687

1 563

1 338

1 018

779

720

572

118

28

12

40

80

105

170

385

436

474

European 
Community 
591

4 610

4 932

3 236

1 890

2 997

2 459

2 075

Commission 
Sub-total 

EIB (2) 

9 788

16 570 

16 098

20 749 

18 375

25 007 

17 243

26 736 

16 021

30 271 

17 415

31 957 

16 962

36 928 

15 880

42 330 

(3)  2 045 

14 947

48 459 

3 516

4 026

5 204

7 697

8 032

6 666

5 853

4 166

4 074

1 566

1 614

1 361

1 356

1 214

1 080

969

786

16 035

58 893 

16 017

67 784 

15 755

78 661 

16 594

83 673 

15 831

87 079 

12 663

96 649 

9 826

110 394 

7 168

123 767 

6 648

146 223 

3 695

159 860 

3 059

176 027 

2 172

181 167 

1 908

194 505 

1 807

214 825 

1 905

248 283 

1 841

246 576 

1 260

254 221 

EUR million 

Total 
borrowing 
26 358

36 847

43 382

43 979

46 292

49 372

53 890

58 210

63 406

74 928

83 801

94 416

100 267

102 910

109 312

120 220

130 935

152 871

163 555

179 086

183 339

196 413

216 632

250 188

248 417

255 481

(1) 

(2) 

(3) 

(4) 

  The conversion rates used are those of 31 December of each year. As the majority of borrowings are denominated 
in national currency, the difference between two year-ends reflects on the one hand changes in the valuation of 
existing stock due to exchange rates fluctuations and on the other the net volume of borrowings during the year. 
Original amount of borrowings, plus or minus repayments of the principal, cancellations, annulments and 
exchange-rate adjustments. 

  As from 1989, including short term. 
  As from 1990, including macro-financial assistance for non-member States. 

This instrument was not extended. 

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1.3. 

Borrowing of the European Institutions in 2007 by currency 

The  share  of  EUR-denominated  borrowings  slightly  decreased  from  the  level  of  37.9%  in 
2006 to 37.7% in 2007 (see Table 1.3). Issues in other Community currencies increased from 
16.6% to 22.4%.  Non-Community currencies took  a  smaller share of borrowing, decreasing 
from 45.4% to 39.9% of the total. Issues in USD were down from 30.4% to 26.3%. In 2007, 
after swaps, 99.1% of the loans were on a variable-rate as compared to 94.5% in 2006 (figure 
before swaps: see Table 1.3). 

EIB 

(1) 

(2) 

EUR million (rounded) 

Total borrowing 

2007 
% 

(1) 

(2) 

(1) 

(2) 

European 
Communities 
(EC, 
Euratom)(3) 

39

39

33 807
6 123
677
134
108
0
0
27
0

40 877
13 955

0

0
0

EUR 
GBP 
SEK 
DKK 
HUF 
RON 
BGN(4) 
PLN 
CZK 
SIT 
SKK 
Total EU 
USD 
JPY 
NZD 
TRY 
AUD 
CAD 
CHF 
ISK 
ZAR 
NOK 
RUB 
HKD 
MXN 
TWD 
Sub-total 
TOTAL(5) 
Fixed-rate 
Variable-rate 

20 675 
11 023 
893 
134 
108 
90 
28 
27 
0 
0 
0 
32 979 
14 400 
2 198 
1 344 
1 097 
905 
659 
445 
261 
234 
196 
115 
0 
0 
0 
21 853 
54 832 
50 790 
4 042 

20 714
6 769
309
235

33 846 
2 549 
309 
235 

102
97
32
18

33 018
13 789
1 813
1 205
943
875
703
424
420
280
101

97 
32 
18 

40 916 
11 675 

88 

80 

37.7 
20.1 
1.6 
0.2 
0.2 
0.2 
0.1 
0.0 
0.0 
0.0 
0.0 
60.1 
26.3 
4.0 
2.5 
2.0 
1.7 
1.2 
0.8 
0.5 
0.4 
0.4 
0.2 
0.0 
0.0 
0.0 
39.9 
100.0 
92.6 
7.4 

61.7
11.2
1.2
0.2
0.2

0.0
0.0

0.0
74.5
25.5

0.0

0.0
0.0

25.5
100.0
0.9
99.1

13 955
54 832
516
54 316

20 552
54 871
41 302
3 994

11 843 
54 871 
2 396 
42 900 

39

39

(1) Figures before swaps.  
(2) Figures after swaps. 
(3) Macro-financial assistance to non-member States and Euratom. 
(4) EU currency as of 01.01.2007. 
(5) Difference before/after SWAP due to exchange-rate fluctuations. 

EN 

7 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2. 

2.1. 

LENDING IN NON-MEMBER STATES 

Lending in non-member States in 2007 – Overview 

EIB(1) 

EUR million 

 EDF resources(2) 

Own resources 

TOTAL 

Pre-Accession countries (Mandate 
2007-2013) 

Neighbourhood and Partnership 
countries (Mandate 2007-2013) 

ALA – Asia and Latin America 
(Mandate 2007-2013) 

388

388

1 205

1 205

305

305

SEN - South Eastern Neighbours(3) 

1 362

1 362

ALA – Asia and Latin America 
(Mandate 2000-2007)(3) 

RSA - South Africa (Mandate 2000-
2007) 

ACP-OCT countries(4) 

335

Russia / WNIS (2004-2007) 

120

113

432

230

120

113

767

230

Total 

(1) 

(2) 

(3) 

(4) 

335

4 155

4 490

Loan signatures, excluding lending at own risk of the EIB. 

Granted and administered by the EIB out of the budgetary resources of the EC or the European Development Fund 
(EDF). 
This grouping follows Council Decision 2005/47/EC. 

Africa, Caribbean, Pacific / Overseas Countries and Territories. 

EN 

8 

   EN 

 
 
2.2. 

Loan  disbursements  for  macro-financial  assistance  and  Euratom  to  non-
member States (2001-2007) 

2001 

2002 

2003 

2004 

2005 

2006 

2007  Total 

EUR million 

50 

50 

28 

40 

68 

0 

0 

0 

0 

9 

10 

15 

15 

19 

0 

10 

10 

60 

0 

0 

0 

0 

0 

0 

Bulgaria 

Romania 

Subtotal  "Enlargement"  countries 
(Member States as of 01.01.2007) 

0 

0 

12 

12 

10 

10 

225 

245 

60 

Albania(1) 

Bosnia and Herzegovina(2) 

fYRoM(3) 

Serbia and Montenegro(4) 

Subtotal Other Western Balkans(5) 

Armenia(6) 

Georgia(6) 

Tajikistan(7) 

Ukraine 

Subtotal NIS 

Lebanon(8) 

Sub total Mediterranee 

Euratom(9) 

Grand Total 

0

50

50

9

30

50

280

369

0

0

60

0

60

0

0

40 

345 

40 

52 

25 

143 

65 

75 

215 

230 

51 

70 

39 

39 

475

954

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

A grant of EUR 3 million was disbursed to Albania in 2005 and a further grant of EUR 13 million in 2006. 
Disbursement of the loan was accompanied by disbursements of grants of EUR 10 million in 2000. A further grant 
of EUR 15 million was paid in 2001 and of EUR 25 million in 2003. In 2005 EUR 15 million grants were disbursed. 
Former Yugoslav Republic of Macedonia. Grants totalling EUR 20 million were disbursed in 2000, followed by a 
further grant of EUR 10 million in 2001, one of EUR 10 million in 2002 and another one of EUR 18 million in 
2003. 
One grant of EUR 115 million was paid to Serbia and Montenegro in 2002, one of EUR 35 million in 2003, one of 
EUR 10 million in 2004 and another one of EUR 25 million in 2005. 
Grants of EUR 35 million and EUR 7 million were disbursed to Kosovo and Montenegro respectively in 2000. In 
2001 EUR 35 million were disbursed to Kosovo and EUR 13 million to Montenegro, granted in the form of 
budgetary support. In the same year a further grant of EUR 15 million was disbursed to Kosovo, followed by 
another one of EUR 15 million in 2002. 
Exceptional financial assistance. These loan disbursements to Armenia and Georgia were supplemented by the 
disbursement of grants totalling respectively, EUR 8 million and EUR 10 million in 1998 and EUR 4 million and 
EUR 9 million in 1999. A further grant of EUR 6 million was made to Georgia in 2001. A grant of EUR 11 million 
was paid to Armenia in 2002. Further grants to Armenia EUR 5.5 million and Georgia EUR 6.5 million were paid in 
2004. In 2005 1.5 million grants was paid to Armenia. In 2006, Georgia received two grants of EUR 11 million 
each. 
This loan was accompanied by the disbursement of grants totalling EUR 14 million. A further grant of EUR 7 
million was paid in 2003 (although decided in 2002), in 2005 for the same amount as well as in 2006. 

(8)  Macro-financial assistance to Lebanon in the form of EUR 50 million in loans and up to EUR 30 million in grants. 

(9) 

Disbursements should start in 2008. 
Including Bulgaria and Romania (Member States as of 01.01.2007) 

EN 

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2.3. 

Signatures on EIB Own Resources in non-EU countries (excluding signatures on 
EIB own risk under Pre-Accession and Mediterranean Partnership facilities) 

2000  2001  2002 2003 2004 2005 2006

ALA (2007-2013) 

ENP MED (2007-
2013) 

Pre-Accession 
mandate 

(2007-2013) 

RSA (2007-2013) 

New General Mandate  

(2007-2013) 

EUR million 

1st half 
2007 

2nd half 
2007 

Total 
2000-
20071  Ceiling

305 

305 

3 800

1 205 

1 205  12 400

388 

388 

8 700

900

1 898 

1 898  25 800

SEN (2000-2007) 

1 086 

653 

925 1 169

865 2 107 1 336

441

921 

9 503 

9 185

MED 

( 2000-2007) 

502 

910  1 000 1 322 1 436 1 102

905

7 177 

6 520

ALA (2000-2007) 

397 

543 

174

348

233

256

483

RSA (2000-2007) 

50 

152 

50

260

100

130

80

60

25

60 

2 546 

2 480

88 

935 

825

Turkey Terra 

375 

75 

150

130

100

220

600 

600

450 

450

Turkey – Special 
Action 

Sub-Total Previous 
General Mandate 
(2000-2007) 

Russia 

Russia WNIS (2004-
2007) 

2 410  2 333  2 279 3 349 2 854 3 595 2 804

526

1 069  21 211  20 060

25

60

85 

100

30

200 

230 

500

1 

These  amounts  include  re-utilisation  of  cancelled  undisbursed  loan  balances  where  applicable.  For 
comparison  against  the  2000-2007  General  Mandate  sub-ceilings,  the  cumulative  signatures  net  of 
cancellations per region amounted (in EUR million) to: 
Asia and Latin America: 
Mediterranean: 
South-Eastern Neighbours: 
Republic of South-Africa: 

2 175 
6 475 
9 177 
824 

EN 

10 

   EN 

  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
 
 
 
 
COTONOU (2003-
2007) 

68

151

167

30

402 

818 

N/A

TOTAL 

2 410  2 333  2 279 3 374 2 922 3 806 2 971

586

3 569  24 157 

EN 

11 

   EN 

 
 
2.4. 

Sharing of Risks  

Council Decision 2000/24/EC, which defines the legal framework of the 2000-2007 General 
Mandate, invited the Bank to "aim to cover the commercial risk on 30% of its lending under 
this  Decision  from  non-sovereign  guarantees  as  far  as  possible  on  an  individual  mandate 
basis.  This  percentage  shall  be  expanded  upon  whenever  possible  insofar  as  the  market 
permits". 

Under  this  risk-sharing  arrangement,  the  Community  Guarantee  covers  selected  political 
risks. This has helped to mobilize commercial bank guarantees in markets where they would 
otherwise not have been available or would have been too costly. 

As it can be seen in Table 2.4 below, at the overall mandate level, at expiry of the 2000-2006 
General  Mandate,  risk-sharing  loans  represented  19%  of  total  cumulative  signatures. 
However, this figure covers significant regional differences: 

–  In ALA countries, where the mandate specifically focused on supporting private European 
initiatives in the form of foreign direct investment, transfer of technology and know-how, 
74% of loan signatures were made under the risk-sharing scheme. 

–  In the Mediterranean, South-Eastern Neighbours and South Africa, projects financed under 
the mandate were, to a large part, in the public sector without risk-sharing arrangements. 
The  proportion  of  risk-sharing  loans  reached  11%  of  total  cumulative  signatures  in  the 
Mediterranean  and  in  South  Africa,  while  the  respective  proportion  in  the  South-Eastern 
Neighbours was 12%. 

Loans  to  private  sector  borrowers  with  non-sovereign  guarantees  were  mostly  signed  under 
the  Mediterranean  Partnership  and  Pre-Accession  Facilities,  which  are  at  EIB’s  own  risk. 
Therefore, they do not directly impact the risk-sharing figures under the mandate but reflect 
the EIB’s increased propensity to take more commercial risk. More precisely, the cumulative 
volume  of  lending  at  EIB’s  own  risk2  reached  EUR  16  billion  in  the  corresponding  period 
(ending  at  31  July  2007).  By  way  of  illustration,  when  combining  risk-sharing  operations 
under the 2000-2006 General Mandate with EIB own risk lending, the overall proportion of 
loans granted either under the risk-sharing arrangements or fully outside the coverage of the 
Community Guarantee increases to some 55% of total EIB lending outside the EU3. 

Under  the  2007-2013  General  Mandate,  the  nature  of  the  guarantee  coverage  has  been 
clarified as covering risks of a political or sovereign nature. This means that the 2007-2013 
General Mandate, instead of setting a target for EIB financing without Community coverage 
of  the  commercial  risk  on  operations,  specifies  the  EIB  financing  operations  which  are 
eligible  for  Comprehensive  Guarantee  as  operations  entered  into  with  sovereign  or  sub-
sovereign  entities  (in  the  case  of  the  latter,  provided  that  the  risk  on  the  operation  is 
appropriate) or covered by a State Guarantee. Those operations not meeting these criteria are 
covered by Political Risk Guarantee only. 

For the sake of completeness, Table 2.4 below shows that by the end of 2007, 4 operations in 
Latin America and 7 operations in the Mediterranean had been signed under the Political Risk 
Guarantee  coverage  of  the  2007-2013  General  Mandate,  corresponding  to  91%  of  total 
signatures  in  Latin  America  and  30%  of  total  signatures  in  the  Mediterranean  under  this 

2 

3 

Under Pre-Accession Facility, Mediterranean Partnership Facility I (expired on 31.01.2007) and under 
the specific Article 18 authorisation of the EIB’s Board of Governors. The two latter mechanisms are 
not represented in Table 2.4, given that no lending thereunder was made in 2007. 
In the regions covered by the 2000-2006 General Mandate, i.e. excluding operations in EFTA countries 
as well as ACP and OCT countries. 

EN 

12 

   EN 

                                                 
mandate. However, it is still too early to deduct any general trends from this limited number 
of operations. 

Table 2.4: Risk-sharing under external lending mandates and lending at EIB own risk as at 31 
December 2007 (EUR million) 

All signatures 

Ceiling

Signatures 
in 2007 

Cumulative 
signatures 

Loans signed with risk-sharing  
/ Political Risk cover 

No. 
of 
loans 

Amount 
signed  

Risk-sharing 
/ cumulative 
signatures 

until 
31.07.2007: 
2 545 
7 177 
9 503 
935 
20 159 
230 
20 389 

until 
31.12.2007: 
305 
0 
305 

1 205 
1 205 

0 
388 
0 
1 898 

120 
0 
1 362 
113 
1 595 
230 
1 825 

305 
0 
305 

1 205 
1 205 

0 
388 
0 
1 898 

40 
13 
40 
3 
96 

4 
0 
4 

7 
7 

0 
0 
0 
11 

1 876 
807 
1 123 
105 
3 911 
n/a 

278 
0 
278 

365 
365 

0 
0 
0 
643 

74%
11%
12%
11%
19%

Political 
Risk cover 
91%
0
91%

30%
30%

0 
0 
0 
34%

2 480 
6 520 
9 185 
825 
19 010 
500 

3 800 
1 000 
2 800 

12 400 
8 700 

3 700 
8 700 
900 
25 800 

19 500 

1 176 

until 
31.12.2007: 
15 407 

2 000 

185 

185 

Not applicable 

3 000 
24 500 

500 
1 861 

500 
16 092 

2000-2007 external lending 
mandate 

Asia and Latin America 
Mediterranean  
South-Eastern Neighbours  
Republic of South Africa 

Russia/WNIS (2004-2007) 

2007-2013 external lending 
mandate 

Asia and Latin America  
- Asia 
- Latin America 
Neighbourhood and Partnership 

Countries 

- Mediterranean  
- Eastern Europe, Southern 
Caucasus and Russia 
Pre-Accession Countries  
Republic of South Africa 

Lending outside the Community 
guarantee 

Pre-Accession Facility 
Mediterranean Partnership 

Facility II 

Facility for Energy Sustainability 

and Security of Supply 

EN 

13 

   EN 

 
 
 
  
 
  
  
  
  
  
  
 
 
 
 
 
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
 
 
 
2.5. 

EIB own risk lending 

The 2006 Council Decision invites the EIB “to increase its operations outside the Community 
without recourse to the Community guarantee, particularly in the pre-accession countries and 
the Mediterranean as well as in investment grade countries in other regions”.  

In 2007, to allow the EIB to provide more support from its own resources and at its own risk, 
the EIB’s Board of Governors has authorised the following additional lending envelopes: 

•  Pre-Accession Facility - an additional indicative lending envelope of EUR 5.5 billion until 

2010, 

•  Mediterranean Partnership Facility II - EUR 2 billion for the period of 2007-2013, and 

•  Facility for Energy Sustainability and Security of Supply – EUR 3 billion for the period of 

2007-2013. 

Table 2.4 above shows that total lending volumes in 2007 were relatively evenly distributed 
among  the  lending  frameworks  in  force:  EUR 1.83 billion  was  lent  under  the  lending 
mandates that expired on 31 July 2007 (including EUR 230 million signed under the special 
mandate4 for certain types of projects in Russia, Ukraine, Republic of Moldova and Belarus), 
while  EUR 1.90 billion  was  lent  under  the  2007-2013  General  Mandate.  In  addition  to 
mandate  lending,  a  total  of  EUR 1.86 billion,  was  lent  under  the  EIB  own-risk  facilities 
without the support of the Community Guarantee. 

the 

replenished  Pre-Accession  Facility  amounted 

Signatures  under 
to 
EUR 1.18 billion,  of  which  Turkey  received  70%  and  Croatia  28%.  The  geographical 
coverage  of  lending  under  the  Pre-Accession  Facility  was  extended  to  include  also  the 
Potential  candidate  countries,  all  of  which  are  potential  beneficiaries  of  a  regional 
microfinance  fund  aimed  at  fostering  economic  development  in  South-East  Europe 
(EUR 25 million signed in 2007). In terms of sectoral distribution, credit lines accounted for 
54% of signatures under the Pre-Accession Facility, while industry and services represented 
19%, followed by energy (16%) and transports (11%). 

in  2007 

Under the Mediterranean Partnership Facility II, an EIB loan amounting to EUR 185 million 
was signed to finance the capacity expansion of one of the priority energy TENs. 

Finally,  under  the  Facility  for  Energy  Sustainability  and  Security,  a  highly  visible 
EUR 500 million  multi-investment  scheme  was  signed  in  China  to  support  investment 
projects  in  the  energy  and  industrial  sectors  that  will  help  to  prevent  or  reduce  greenhouse 
gases and other polluting emissions.  

2.6. 

Impact and value added of EIB external lending 

A  major  guiding  principle  for  the  EIB  when  fulfilling  its  mission  as  a  policy-driven  public 
bank is to maximize the value added of its activity. The EIB assesses the value added of its 
operations on the basis of a framework structured along the following three pillars: 

Pillar 1 - the consistency with and contribution to EU policy objectives; 
Pillar 2 - the quality and soundness of the project; and 
Pillar 3 - the financial and non-financial contribution made by the EIB to the project. 

4 

Council  Decision  2005/48/EC  of 22  December  2004. Loans granted under  this Decision  benefit  from 
100%  coverage  by  the  Community  guarantee  in  contrast  to  65%  applicable  to  the  other  mandates  in 
force in 2007.  

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Each individual financing operation is assessed against this framework, using a set of relevant 
indicators.  The  framework  applied  to  operations  in  the  Pre-Accession  countries,  called  the 
Value  Added  (VA)  framework,  is  designed  to  reflect  the  EIB’s  support  to  Pre-Accession 
countries’  economic  development  process  and  thus  also  their  preparation  for  potential 
transition to EU membership status. This framework is identical to the one used for financing 
operations within the EU. 

The  framework  that  is  applied  to  operations  in  all  other  regions  covered  by  the  external 
lending mandate, called the Economic and Social Impact Assessment Framework (ESIAF), is 
adapted  to  reflect  the  different  needs  and  characteristics  as  well  as  the  respective  lending 
objectives of each of the geographical regions. In addition, the assessment of project quality 
and soundness, which constitutes the second pillar, is significantly expanded under ESIAF to 
take account of a broader range of issues, notably in the social area. 

On  the  basis  of  facts  and  data  collected  during  project  appraisal,  the  EIB  project  teams 
provide  a  qualitative  performance  rating  for  each  of  the  three  pillars,  based  on  their 
professional judgement. Besides serving as a tool to assess projects during the selection and 
appraisal  process,  the  framework  provides  valuable  information  and  benchmarks  for  both 
monitoring  and  ex-post  evaluation.  It  also  plays  a  central  role  in  providing  information  to 
stakeholders in a systematic manner on the performance and impact of EIB activity. 

2.7. 

Performance indicators  

The EIB sets operational targets (measured by Performance Indicators) for the value added of 
its lending activity. These targets are defined as the minimum proportion of operations with 
“high” or “medium” overall ratings, which represent the two highest categories of a total of 
four overall rating categories. Operations signed in 2007 under the external lending mandate 
met the value added targets in each of the three pillars. 

Table 3: Summary of value added ratings of operations signed in 2007 

Impact rating 

Pillar 1 

Pillar 2 - Investment loans Pillar 2 - Financial sector 

Pillar 3 

High 
Medium 
Moderate 
Low 

Total no. of operations5 

26 
5 
0 
0 

31 

11 
9 
1 
1 

22 

2 
9 
0 
0 

11 

26 
5 
1 
0 

32 

84% of EIB operations signed under mandate in 2007 are judged to be highly consistent with, 
and to make a strong contribution to, the mandate objectives and priorities. This is reflected in 
the assignment of a “high” rating on Pillar 1. In turn, 16% of operations were rated “medium” 
on Pillar 1. The interpretation of the “medium” rating is that the EIB contributes to a project 
that is, in the reasonable and justified opinion of the project team, compliant with the key EU 
criteria on political eligibility and consistency with EU external policies and strategies, which 
in  turn  also  imply  consistency  with  national  strategies.  More  specifically,  such  a  project  is 
deemed  to  meet  one  or  more  of  the  mandate-specific  core  objectives,  which  can  be  either 

5 

In 2007, loans signed under mandate represented 34 projects. One project was appraised in 2003, i.e. 
prior to the introduction of VA, and has therefore not been rated. Several projects were appraised prior 
to the formal introduction of ESIAF in the second half of 2007; they have been assessed according to a 
preliminary framework that was at the time in test phase. Due to this, overall ratings are not available 
for Pillar 1 in the case of two projects and for Pillar 3 in the case of one project 

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sectoral  or  thematic.  (The  mandate-specific  objectives  and  EIB  contribution  to  them  are 
summarised in section 2.8 below and further detailed by geographical regions in section 2.12). 
In contrast, the “high” rating means that in addition to unambiguously meeting the foregoing, 
it  can  be  evidenced  that  the  project  has  additional  strengths  based  on  clear  confirmation  of 
other indicators, classified as non-core. No projects were rated “moderate” or “low” in Pillar 1 
thereby  reflecting  the  EIB’s  upfront  screening  of  operations  and  clear  focus  on  their 
consistency with, and contribution to, EU policy objectives. 

Pillar  2  measures  the  expected  quality  of  the  project,  i.e.  the  extent  to  which  the  project 
represents a rational allocation of resources and meets the needs of its beneficiaries, including 
its  final  customers,  and  of  the  society  at  large.  The  assessment  of  project  quality  takes  into 
consideration  possible  EIB  input  in  project  definition,  preparation  and  implementation 
arrangements, which may have contributed to improve the project quality and mitigate risks. 
Particular value added can arise from project conditionality (e.g. those related to tariff studies 
or  environmental,  social  and  governance  issues)  or  from  technical  assistance  elements 
provided during project conception or appraisal. These usually push or commit promoters to 
reach standards beyond their usual practice. Such EIB contribution towards an improvement 
in project quality is separately reported under Pillar 3. 

Project  quality  is  assessed  according  to  extensive  criteria  covering  the  economic,  technical, 
financial  and  environmental  soundness  of  the  project,  as  well  as  management  capability  to 
design,  implement  and  operate  the  project.  The  key  quality  criteria  concern  essentially:  the 
economic  and  financial  sustainability,  the  environmental  sustainability,  the  quality  of  the 
promoter’s  management  and,  if  relevant,  specific  technological,  social,  governance  and/or 
institutional aspects. 

For indirect financial sector operations, where the individual sub-projects are not known at the 
time  of  appraisal,  a  distinct  set  of  indicators  is  used.  These  incorporate  assessments  of  the 
operating  (macro-financial  and  regulatory)  environment,  the  financial  intermediaries  within 
that environment and the development impact of the operation. 

18%  of  financial  sector  operations  signed  in  2007  were  rated  “high”  in  Pillar  2,  while  82% 
received “medium”. The higher proportion of “medium” ratings notably reflects the quality of 
financial  intermediaries  used  in  some  global  loans,  either  in  terms  of  their  financial 
performance or their experience in the sector or the objective targeted by the operation. 

For investment loans, the proportion of “high” ratings in Pillar 2 represented 50% of projects; 
“medium” was attributed to 41% of projects. 

Only one "low" rating was attributed to Pillar 2 for a desalination plant in Israel. The quality 
and soundness of this project is justified on strategic grounds, the benefits of which cannot be 
quantified. Desalination is perhaps the only method under Israel's control to increase security 
of water supply during Israel's extreme drought events, the frequency of which is increasing. 

Pillar 3 provides an assessment of the EIB’s contribution to a project. It covers the financial 
benefits  obtained  by  a  borrower  from  EIB  participation  in  the  project,  such  as  the  longer 
maturities and grace periods, attractive interest rates, and risk capital instruments. In addition, 
the EIB provides non-financial benefits that improve the sustainability of the project through 
changes to project design and features, project conditionality and technical assistance. 

81% of projects were assessed to benefit from “high” EIB contribution (Pillar 3), while 16% 
were rated “medium”. 

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2.8. 

Support for EU policies 

The EIB’s role as a public policy-driven bank is to contribute, by financing sound investment, 
to  the  implementation  of  the  EU  policy  and  objectives.  As  mentioned  earlier,  Council 
Decision 2006/1016/EC in its preamble provides some specific policy goals to be addressed 
through EIB external financing. In alignment, the EIB’s Corporate Operational Plan defines 
parallel  priority  strategic  operational  objectives  for  the  period  2008-2010  in  the  regions 
covered by the 2007-2013 General Mandate. 

Table 4: Summary of key lending objectives  

Lending Objectives 

Asia & 
Latin 
America 

Eastern 
Neighbours 
& Russia 

Mediterranea
n Countries 

Pre-
Accession 
Countries 

South 
Africa 

X 

X 

Energy - Security of Supply 

Environmental  Protection 
Improvement 

and 

Private 
SMEs 

Sector  Development, 

Infrastructure 
including extension of TENs 

Development, 

Pre-Accession support 

Support  of  EU  presence  (FDI, 
transfer  of  technology  and  know-
how) 

X 

X 

X 

X 

X 

X 

X  

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

As  shown  in  Table  4  above,  the  protection  of  the  environment  and  energy  security  are 
common  objectives  throughout  the  regions  covered  by  the  external  lending  mandate.  The 
specific regional orientations and the corresponding financing activity in 2007 are detailed for 
each geographical region in the sections below. 

For  all  the  projects  it  finances,  the  EIB  must  pay  special  attention  to  the  issue  of 
environmental  sustainability,  focusing  on  the  environmental  impact  assessment  of  the 
investments  proposed  and  the  adequacy  of  mitigating  measures  as  well  as  on  the  energy 
efficiency  of  proposed  technologies  or  processes. Furthermore, an  increasingly large part of 
the  EIB’s  lending  is  specifically  targeted  at  protecting  and  improving  the  natural  and  built 
environments and fostering social well-being in the interest of sustainable development. 

Many transport projects also have positive contributions to the environment. This is typically 
the case with investment in public transport infrastructure. The construction of light rail and 
tramway systems featured prominently in the EIB financing, reflecting the trend towards more 
cost-effective  and  flexible  mass  transport  systems.  Moreover,  the  Bank  supports  a  range  of 
transport  projects  where  the  explicit  project  aim  is  to  achieve  environmentally  friendly  and 
sustainable transport systems leading to a substantial reduction in emissions of CO2 and other 
pollutants. 

In  Pre-Accession  countries,  projects  financed  in  2007  under  mandate  with  specific 
environmental  protection  as  the  main  lending  objective  accounted  for  EUR 731 million  or 
42% of total lending in the region. These consisted of public transport projects in Turkey and 
a  renewable  energy  project  in  Bosnia-Herzegovina.  In  the  Mediterranean,  EUR 120 million 

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was  advanced  for  environmental  schemes  in  Israel,  namely  for  the  improvement  of 
environment  and  health  through  provision  of  safe  drinking  water.  This  same  objective  was 
also  targeted  by  a  EUR 60 million  project  in  Asia  for  the  extension  and  upgrading  of  water 
supply  and  distribution  infrastructure  in  Greater  Manila,  and  by  another  EUR 27 million 
project in Latin America, for the improvement of sanitation and environmental conditions in 
Panama City. 

In total, EUR 938 million, or 25% of EIB financing under mandate, contributed to the Bank’s 
overarching  goal  of  promoting  environmentally  sustainable  development  in  the  partner 
countries. 

Environmental consideration is taken into account at all stages of the EIB project cycle. The 
EIB applies a set of “safeguards” to ensure the application throughout its financing activities 
of  good  practice  towards  environmental  issues,  based  on  EU  environmental  principles  and 
standards, that is the “European Principles for the Environment” (EPE), defined as: 

–  the guiding environmental principles in the EC Treaty, and 

–  the practices and standards incorporated in EU secondary environmental legislation. 

In 2007, the five EPE signatory financing institutions (Council of Europe Development Bank 
(CEB), European Bank for Reconstruction and Development (EBRD), Nordic Environmental 
Finance Corporation (NEFCO), Nordic Investment Bank (NIB) and the EIB), with the support 
of the European Commission and its DG ENV, decided to further develop the concept of EPE 
by  preparing  a  single  reference  document  of  EU  environmental  legislation,  principles  and 
standards  most  relevant  to  the  projects  the  EPE  institutions  are  financing.  Through  this 
common  EU  approach,  the  institutions  provide  a  consistent  and  visible  mechanism  for 
engaging with project sponsors in addressing environmental issues. In turn, this will allow the 
institutions to better manage credit and project risk related to the environment. 

In the energy sector, the Bank generally seeks to contribute to the key policy objectives of the 
EU as follows: 

•  sustainability – by promoting renewable energy sources, to reduce both dependence on the 
outside  world  and  the  negative  impact  of  energy  production  and  consumption  on  the 
natural environment, particularly through CO2 emissions; 

•  competitiveness  in  energy  supply  –  a  key  consideration  for  the  economic  development, 

given the central role played by energy in the modern economy; and 

•  security of supply – by promoting diversified sources of energy, reducing dependence on 
external supplies and the potential impact of the many international risk factors that affect 
the energy market. 

As can be seen in table I of the report, energy represented the third most important sector in 
2007  with  EUR 471 million  directed  towards  the  aim  of  enhancing  energy  supply  and 
stimulating  economic  development  in  Egypt,  Morocco,  Bosnia-Herzegovina  and  South 
Africa.  This  lending  under  mandate  was  complemented  by  another  EUR 875 million  lent  in 
favour of 3 operations, one under each of the EIB-own risk facilities: 

–  EUR 500 million multi-investment scheme in China, signed under the Facility for Energy 
Sustainability  and  Security  of  Supply,  to  support  investment  projects  in  the  energy  and 
industrial  sectors  that  will  help  to  prevent  or  reduce  emission  of  greenhouse  gases  and 
other polluting emissions. This pilot operation will serve as a benchmark for other possible 
similar operations. 

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–  EUR 185 million  financing  granted  in  Tunisia,  under  the  Mediterranean  Partnership 
Facility II, to finance the capacity expansion of one of the priority energy TENs, namely 
Transmed gas pipeline connecting Algeria to Italy via Tunisia. 

–  EUR 190 million  lent  under  the  Pre-Accession  Facility  for  the  modernisation  and 

expansion of the national gas transmission system in Croatia. 

Altogether,  the  EIB  support  for  energy  projects  outside  the  EU  in  2007  consisted  of  7 
operations amounting to total lending of EUR 1.35 billion. 

The contribution of EIB lending activity per geographical region can be found in section 2.4 
in the Annex. 

2.9. 

Cooperation with International Financing Institutions 

During 2007, the EIB actively pursued its policy to enhance the effectiveness of its operations 
by  further  reinforcing  and  developing  its  operational  partnerships  with  other  International 
Financial  Institutions  (IFIs).  Cooperation  has  continued  to  be  an  integral  part  of  EIB’s 
activities, ranging from dialogue on institutional matters to cooperation on operational lending 
and co-financing, to mutual consultation on horizontal topics and thematic issues. (A list of 
projects co-financed with other IFIs in the regions covered by the external lending mandate is 
included in section 2.11 in the Annex). 

Council  Decision  2006/1016/EC  invites  the  EIB  to  further  enhance  coordination  and 
cooperation with IFIs and with European bilateral institutions where relevant. The objectives 
are to maximize synergies, to ensure reasonable risk sharing and coherent sector and project 
institutions, 
conditionality.  This 
establishment of clear sector conditionality criteria, increased use of co-financing of projects, 
participation in global initiatives such as those promoting aid coordination and efficiency. 

includes  strengthening  coordination  between 

the 

Regular meetings at senior management as well as at field level took place and the EIB also 
seeks to increase the number of jointly appraised and co-financed projects with other IFIs. 

A  number  of  Memoranda  of  Understanding  have  facilitated  cooperation  between  the  Bank 
and other IFIs, gradually covering more regions outside the EU. In this context, the EIB has 
participated  in  several  working  groups  together  with  the  Commission  and  with  other  IFIs, 
notably for coordination in Pre-Accession countries, as well as in Neighbourhood and Partner 
countries. 

In  the  Pre-Accession  region,  the  EIB  has  participated,  together  with  the  Commission  and 
other  IFIs,  in  the  work  of  the  newly  founded  IFI-Advisory  Group  (which  succeeds  the 
Infrastructure Steering Group) and related working groups on transport, energy, environment 
and social sectors. 

Together with the Commission, the EBRD and the CEB, the EIB is actively involved in the 
Infrastructure Project Facility (IPF) to channel EC funds for technical assistance in support of 
priority infrastructure projects in the Pre-Accession countries, primarily focusing on potential 
candidate countries. This is part of the Western Balkans Infrastructure Initiative, which will 
also  include  a  Complementary  Grant  Financing  Mechanism  and  a  Lending  Facility  to  be 
implemented by the end of 2008, and the broader Western Balkans Investment Framework to 
be developed by 2010.  

Within  the  framework  of  the  European  Neighbourhood  Policy,  a  Memorandum  of 
Understanding for Eastern Europe, Southern Caucasus, Russia and Central Asia was signed in 
July  2007  (replacing  a  previous  agreement  signed  in  2000)  between  the  co-signatories 
Commission,  EIB,  EBRD,  Black  Sea  Trade  and  Development  Bank  (BSTDB),  CEB, 

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International  Bank  for  Reconstruction  and  Development  (IBRD),  International  Finance 
Corporation (IFC) and NIB. 

The Tripartite Agreement between the Commission, the EBRD and the EIB, signed at the end 
of 2006, for operational cooperation activities in Eastern Europe, Southern Caucasus, Russia 
and Central Asia, has started to be implemented in 2007, with a close dialogue between the 
three institutions and  the establishment  of a joint  pipeline.  The  EIB  and  the  EBRD  are  also 
closely  associated  in  other  initiatives  and  partnerships  (e.g.  Joint  Assistance  to  Support 
Projects in European Regions (JASPERS) technical assistance initiative in the framework of 
EU regional policy). 

In the Mediterranean region, a reinforced dialogue with the World Bank (WB) has been re-
launched, with bilateral meetings taking place at end 2007. This dialogue may be extended in 
the  future  to  European  bilateral  institutions (Kreditanstalt  für  Wiederaufbau  (KfW),  Agence 
française de Développement (AfD)) with whom the EIB has a long established cooperation in 
the  region.  In  addition,  the  IFC  has  joined  the  EIB,  the  Commission  and  the  IBRD  in  the 
strategic  partnership  for  cooperation  in  the  Middle  East  and  North  Africa  /  Southern 
Mediterranean region. 

In  the  Eastern  and  Southern  Neighbourhood  region,  the  EIB  is  among  the  eligible  Finance 
Institutions which participate in the Neighbourhood Investment Facility (NIF) to provide EC 
grant support to investment projects in the neighbourhood region.  

A  new  Memorandum  of  Understanding  was  signed in 2007 between the EIB  and  the  Asian 
Development Bank (ADB) to promote collaboration in the Asia and Pacific region. 

Furthermore,  during  2007  the  EIB  has  entered  into  formal  collaborations  with  other  IFIs  in 
the  environmental  field:  the  Multilateral  Carbon  Credit  Fund  (MCCF)  with  the  EBRD,  the 
Carbon  Fund  for  Europe  (CFE)  set  up  with  the  World  Bank  and  the  EIB-KfW  Carbon 
Program. Finally, during the 2007 EIB Forum in Ljubljana, the Post-2012 Carbon Credit Fund 
was launched, being the direct result of on-going cooperation in the field of climate change 
between the EIB and three leading European national financing institutions, namely Instituto 
de Crédito Oficial (ICO), KfW and the NIB. 

The  EIB  will  continue  its  active  involvement  in  the  Northern  Dimension  Environmental 
Partnership  (NDEP)  Steering  Committee  (including  also  Russia,  the  Commission,  EBRD, 
NIB  and  the  World  Bank)  to  co-ordinate  and  accelerate  the  implementation  of  important 
environmental and nuclear safety projects in the Northern Dimension region. 

Last but not least, it is recalled that EIB, EBRD, CEB, NIB and NEFCO remained committed 
to  the  terms  of  the  European  Principles  for  the  Environment  (EPE)  Agreement,  strongly 
supported by the Commission. 

It shall be noted that the EIB participates in several working groups and committees together 
with  other  IFIs  on  thematic  issues,  including,  inter  alia:  environment,  social  issues,  risk 
management,  ex-post  evaluation,  internal  audit,  legal  affairs,  planning  budget  and  control, 
financial control, trust funds, funding issues, treasury issues, human resources. 

In addition, the EIB: 

•  Participates  in  the  annual  meeting  of  Heads  of  Multilateral  Development  Banks  and  the 
broader meeting of Heads of Multilateral Finance Institutions (including the Commission). 

•  Attends  the  annual  meetings  of  EBRD,  WB,  African  Development  Bank  (AfDB),  ADB, 

Inter-American Development Bank (IADB). 

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•  Participates,  together  with  WB,  IMF  and  Commission  to  the  Luxembourg  group  (annual 

meeting), focusing on cooperation in the Mediterranean. 

•  Is a member of the Long Term Lenders Club. 

•  Is  a  member,  together  with  EDFI  members,  KfW  and  AfD,  of  INTERACT  informal 

network meeting annually. 

•  Regularly participates in various conferences and events organised by other IFIs, notably 

by the EBRD, World Bank, AfDB, ADB, NIB, BSTDB and CEB 

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2.10.  List of projects signed under mandate in 2007 co-financed with other IFIs  

Region 
(mandate) 

Country 

Project 

EUR million 

Project 
cost 

EIB loan 
signed in 
2007 

Other6 

Multilate-
ral 
Financial 
Instituti-
ons 

European 
Bilateral 
Financial 
Instituti-
ons 

ALA IV 

Panama 

Improvement of sanitation and environmental conditions in Panama City 
through  construction  of  sewerage  network,  collectors,  interceptor  and 
wastewater treatment plant 

210 

27 

32 

ENP/MED 

Egypt 

Construction  of  two  natural  gas-fired  combined-cycle  power  generation 
units in El Atf and Sidi Krir 

753 

130 

81 

ENP/MED  Morocco 

Construction of Fez - Taza section of toll motorway linking Fez to Oujda 

ENP/MED  Morocco 

Construction  of  hydro-powered  electricity  projects  and  setting  up  of  an 
automated network management system. 

517 

381 

180 

150 

172 

75 

76 

RUS/WNIS 

Republic  of 
Moldova 

Rehabilitation  of  trunk  road  network  along  main  east-west  and  north-
south routes 

100 

30 

42 

RUS/WNIS  Ukraine 

Rehabilitation  of  the  final  section  of  the  4-lane  M-06  highway  between 
Kiev and Brody, with a length of 427 km, on Pan-European Corridor III. 

505 

200 

200 

151 

542 

165 

80 

28 

105 

SEN 

Bosnia  and 
Herzegovi-
na 

Rehabilitation of hydropower plants and distribution facilities 

213 

103 

60 

47 

3 

6 

EN 

Including i.a. further EIB financing signed or to be signed, borrower own funds, financing by non-European bilateral financial institutions or commercial banks. 

22 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
Region 
(mandate) 

Country 

Project 

Project 
cost 

EIB loan 
signed in 
2007 

Other6 

Multilate-
ral 
Financial 
Instituti-
ons 

European 
Bilateral 
Financial 
Instituti-
ons 

SEN 

Bosnia  and 
Herzegovi-
na 

Rehabilitation  of  pavement  of  number  of  sections  of  main  and  regional 
road network 

100 

50 

48 

SEN 

Serbia 

Rehabilitation of E70/E75 motorway crossing Belgrade and of R251 ring 
road 

Serbia 

Rehabilitation of roads and bridges throughout Serbia 

Turkey 

Construction of first line of modern tramway system in Antalya 

77 

145 

122 

33 

33 

41 

25 

12 

41 

3 

2 

19 

98 

40 

Turkey 

Construction of high-speed railway line between Istanbul and Ankara 

2 566 

437 

322 

1 807 

SEN 

SEN 

SEN+Pre-
Acc. 

Pre-Acc. 

Serbia 

Construction of 47 km bypass, of which 27 km of motorway and 20 km of 
road, on Pan-European Transport Corridor X, west and south of Belgrade 

Pre-Acc. 

Albania 

Construction of new expressway between Levan and Vlorë 

137 

63 

60 

26 

5 888 

1 500 

55 

22 

865 

22 

15 

448 

3 077 

EN 

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2.11.  Cooperation with the Commission 

The  EIB  and  the  Commission  have  close  institutional  and  operational  links.  While  the 
Commission  is  responsible  for  the  preparation,  development  and  implementation  of  EU 
policies,  the  role  of  the  EIB,  as  a  policy-driven  EU  financing  institution,  is  to  support  – 
through long-term lending – investment projects furthering the EU policy objectives. Only a 
joint  approach  can  deliver  greater  efficiency  and  visibility  for  the  EU  and  satisfactory 
leverage of EU budget funds through EIB loans. 

Existing  formal  EC-EIB  cooperation  includes,  inter  alia,  a  consultation  procedure  in 
accordance  with  Article  21  of  the  Bank’s  Statute,  whereby  all  applications  for  loans  are 
submitted to the Commission for an opinion on the conformity of the investment concerned 
with EU policies, before the financing is approved by the EIB Board of Directors. 

Also,  under  the  terms  of  the  Bank’s  Statute,  the  Commission  nominates  a  member  to  the 
Bank’s Board of Directors. 

In  addition  to  formal  cooperation,  information  between  the  EIB  and  the  Commission  is 
exchanged, inter alia, during the early preparation phase of Annual Action Programmes with 
a view to including references to EIB activities in the regions concerned. Furthermore, when 
preparing its Corporate Operational Plan, which covers a three-year planning perspective and 
is  updated  annually  on  a  rolling  basis,  the  EIB  tailors  its  operational  lending  priorities  to 
reflect EU policy developments. 

Council  Decision  2006/1016/EC  invites  the  Commission  and  the  EIB  to  strengthen  the 
consistency  of  EIB  actions  with  EU  policies,  mainly  through  a  regular  and  systematic 
dialogue and early consultation on policies, strategies and project pipelines. To this end, the 
EIB  and  the  Commission  signed  a  Memorandum  of  Understanding  defining  the  terms  and 
conditions of this strengthened cooperation, on 26 May 2008. A Steering Group set up under 
the Memorandum of Understanding will monitor its implementation. 

With a view to enhancing the coherence of overall EU support in the regions covered by the 
external  lending  mandate,  opportunities  are  sought  to  combine  EIB  financing  with  EU 
budgetary  resources  as  appropriate,  through,  inter  alia,  the  Instrument  for  Pre-Accesssion 
Assistance  (IPA),  the  European  Neighbourhood  and  Partnership  Instrument,  the  Instrument 
for Stability and, for South Africa, the Development and Cooperation Instrument. 
In  2007,  the  Commission  and  the  EIB  cooperated  in  establishing  the  EU’s  Neighbourhood 
Investment Facility, which will mobilise additional funding for infrastructure projects mainly 
in  the  energy,  transport  and  environment  sectors  in  the  entire  area  of  the  European 
Neighbourhood Policy by providing grant support for lending operations of public European 
financial institutions. The facility is open to contributions from all EU Member States so that 
resources  from  the  Community  budget  and  of  the  EU  countries  and  public  financial 
institutions  will  be  pooled  and  better  streamlined  for  the  benefit  of  partner  countries.  Close 
coordination between the Commission and the EIB is also taking place in the context of EU 
financial  instruments  in  support  of  the  Western  Balkans  under  the  IPA.Moreover,  for  the 
benefit  of  the  Mediterranean  region,  the  EIB  manages  EU  budgetary  resources  in  three 
domains:  technical  assistance,  risk  capital  and  interest  subsidies  attributed  to  selected  EIB 
loans. 

In  2007,  24  technical  assistance  operations  with  an  overall  value  of  EUR 17.5 million  were 
contracted  in  the  Mediterranean  under  the  FEMIP  TA  Support  Fund.  Over  84%  of  these 
were allocated to the infrastructure, environment, water and wastewater sectors, reflecting, to 
a  large  extent,  the  traditional  areas  of  EIB  activity  in  the  region.  Support  to  the  financial 

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sector  absorbed  10%  of  technical  assistance  funds  in  2007,  while  human  capital  (the  health 
sector) received 7%. 

In this framework, it is noteworthy to mention EIB’s active contribution to the Commission’s 
Horizon  2020  initiative  to  reduce  the  level  of  pollution  in  the  Mediterranean  Sea.  A  study 
committed  in  2007  focuses  on  identifying  3-5  of  the  most  regionally  polluting  industrial 
and/or municipal sources and creating a pipeline of investment projects, in close collaboration 
with  the  Commission,  the  World  Bank  and  the  United  Nations  Environment  Programme 
(UNEP) / Mediterranean Action Plan (MAP). 

The  FEMIP  Trust  Fund  (FTF),  with  a  financial  envelope  of  EUR 34.5 million  funded  by 
contributions  of  15  Member  States  and  the  Commission,  provides  resources  to  upstream 
technical  assistance  and  risk  capital  operations  in  certain  priority  sectors  in  order  to  foster 
private sector development in the region. In 2007, the FTF Assembly of Donors approved 5 
new operations for a total volume of EUR 0.75 million. 

A first EUR 2 million risk capital operation was signed under FTF in 2007. The EIB initiated 
and  promoted  the  first  privately  managed  start-up  fund  in  Tunisia.  This  investment  fund  is 
focused on innovative Tunisian companies that are in the process of being set up or have been 
established for less than five years. 

As the main provider of risk capital in the Mediterranean, the EIB continued its active support 
to the development of the nascent private equity industry in the region. 

In  2007,  the  EIB  signed  seven  risk  capital  operations  under  MEDA  II  for  a  total 
commitment of EUR 46.5 million. The MEDA-mandate being now fully depleted, future risk 
capital operations will be carried out under the ENP instrument through multi-annual budget 
contributions as well as through additional resources which are expected to be provided from 
reflows on previous operations. 

Three broad trends emerge from the 2007 risk capital operations: 

1. 
Increased  geographical  coverage:  in  line  with  the  recommendations  made  by  the 
Member  States  through  the  FEMIP  Committee  of  April  last  year,  the  reach  of  2007  risk 
capital operations was broadened to include Lebanon for the first time (2 operations). Also, a 
direct operation in support of the modernization and expansion of a family-owned fruit juice 
producer was performed in Algeria, despite the difficult environment. 

Regional integration: a total of 63% of operations were regional initiatives that are not 
2. 
only  good  for  private  sector  development,  but  can  also  be  front  runners  in  terms  of  policy 
objectives. 

Innovation:  the  2007  operations  included  several  innovative  features  or  “firsts”  in 

3. 
terms of investment policy. 

The risk capital operations signed in 2007 included an EUR 8 million equity participation in a 
fund  investing  in  minority  shares  of  private  SMEs  in  the  Mediterranean  region,  including 
Morocco  and  Tunisia.  The  fund  displays  several  innovative  features  such  as  investing  in 
leveraged buy-outs in Morocco, thereby supporting a niche not fully covered by other funds in 
the  country.  In  Tunisia,  the  fund  supports  companies  aimed  at  a  listing  on  the  Tunisian 
alternative market. This initiative, implemented at the end of 2007, is strongly supported by 
the Tunisian government as an opportunity to substantially increase the capitalisation of the 
stock market. 

The EIB also supported the first move in private equity of a major Lebanese commercial bank 
by taking a EUR 7.5 million participation in a multi-sector investment fund. This operation is 

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accompanied by technical assistance that will contribute towards developing local governance 
and documentation standards in line with best international practices. 

Furthermore,  the  EIB  made  a  (EUR 2 million)  local  currency  loan  to  the  Tunisian 
microfinance  association  to  realise  its  growth  objectives  by  financing  itself  on  the  local 
market,  which  will  help  the  sustainability  of  the  institution  in  the  long  run. The  loan  will 
allow  the  granting  of  more  than  50,000  micro  credits  that  will  contribute,  inter  alia,  to  job 
creation in local SMEs. EIB participation in this operation is also likely to play a significant 
catalyst role with local investors. 

One  credit  line,  signed  in  2007  to  assist  Lebanese  SMEs  with  reconstruction  efforts,  is 
accompanied by an EC interest rate subsidy. Table 2.20 lists the programmes which are still 
under way and the amount of interest subsidy paid during the years under review. 

In  support  of  South  Africa,  the  EIB  continued  assisting  the  Commission  in  the 
implementation of a dedicated EU-funded (EUR 50 million) second Risk Capital Facility for 
South  African  SMEs  that  provides  employment  opportunities  to  historically  disadvantaged 
persons. 

Furthermore, work is underway to appraise the feasibility and operating modalities of another 
programme sponsored and financed by the Commission with the objective to support diverse 
investments with a high development impact in South Africa. 

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2.12.  Contribution of EIB lending activity per geographical region 

2.12.1.  Asia and Latin America 

Mandate-specific core objectives 

Support  for  EU  presence  in  ALA  (European  FDI,  transfer  of  European 
technology or know-how) 

Support  of  environmental  sustainability 
mitigation) 

(including  climate  change 

Support for energy security projects7 

Number 
of 
operations 

4 

2 

- 

Total number of operations signed in 2007 

5 * 

Total EIB financing (EUR million) 

425 

To ensure that the EIB can better support the EU’s cooperation strategy in ALA, the sectoral 
and  geographical  coverage  of  the  new  mandate  was  broadened.  In  particular,  new  areas  of 
EIB intervention in ALA now include projects that contribute to environmental sustainability, 
including  climate  change  mitigation,  or  to  the  energy  security  of  the  EU.  Furthermore,  the 
Bank should expand the range of countries benefiting from EIB financing, including the less 
prosperous  countries.  The  EIB  also  continues  to  support  the  EU’s  presence  in  the  countries 
concerned through foreign direct investment and the transfer of technology and know-how. 

EU  presence  in  ALA  was  supported  by  all  mandate  operations  signed  in  2007  except  one. 
This  one  project  with  a  public  borrower  provides,  in  turn,  significant  support  to  the 
environmental sustainability objective by improving public water and sanitation infrastructure 
in Panama. It will improve the quality of life for local residents, in particular in poor areas that 
so far have not been served with sanitation services, reduce sanitary and health hazards, and 
develop  tourism  and  fishing  activities  in  the  region.  Furthermore,  the  technical  assistance 
provided  in  support  of  this  project  aims  at  promoting  water  demand  management  measures 
and  improving  the  efficiency  of  water  networks  in  Panama  City,  thereby  having  a 
demonstration effect on the rest of the country. The project conditionality will contribute to 
the  implementation  of  major  institutional  reforms  necessary  to  guarantee  the  financial 
sustainability of the sector. 

Another operation contributing to environmental sustainability, and supporting also European 
presence in ALA, was signed in Philippines. The project components financed by the EIB are 
part of a comprehensive investment programme for the expansion and improvement of water 
supply  and  distribution  network  in  East  Zone  of  Manila,  which  counts  some  5  million 
customers. This project will improve the quality of life and reduce health risks of more than 
600 000 people who will benefit from the safe water supply services provided by the project. 
Positive  environmental  effects  also  result  from  the  more  efficient  use  of  existing  water 
resources,  particularly  through  the  upgrading  and  extension  of  existing  facilities  and  the 

7 

* 

To be noted that these tables take into account only mandate operations, and do not therefore include 
operations signed under the EIB own risk facilities without the support of the Community Guarantee. 
The numbers above cannot be added, as a single operation may contribute to several objectives. 

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reduction of water losses. Part of the extension of the coverage of water services focuses on 
deprived  communities  through  “Water  for  the  Poor  Communities”  projects,  thus  further 
contributing to the water Millennium Development Goals in the Philippines. 

2.12.2.  Eastern Europe, Southern Caucasus and Russia 

Mandate-specific core objectives 

Number  of 
operations  

Support for project with significant interest to the EU in transport, energy, 
telecommunications and environmental infrastructure  

Support for projects extending major Trans European Network axes 

Support for project with cross-border implications for one or more Member 
States 

Support  for major project  favouring regional integration through increased 
connectivity 

Support for environmental projects in Russia, within the framework of the 
Northern Dimension Environmental Partnership 

Support for strategic energy supply and energy transport projects 

Close cooperation with the EBRD 

2 

2 

2 

2 

- 

- 

2 

Total number of operations signed in 2007 

2 8 

Total EIB financing (EUR million) 

230 

EIB financing operations in Eastern Europe, the Southern Caucasus and Russia are carried out 
in  close  cooperation  with  the  EBRD  according  to  the  terms  set  out  in  a  tripartite 
Memorandum of Understanding between the European Commission, the EIB and the EBRD, 
which  aims  to  bring  together  the  expertise,  capacity  and  comparative  advantages  of  each 
participant for the successful implementation of the European Neighbourhood Policy and the 
EU-Russia Strategic Partnership. 

The  2007-2013  General  Mandate  expands  the  EIB’s  activities  to  include  the  Southern 
Caucasus.  Consequently,  Framework  Agreements  were  signed  by  the  EIB  with  Georgia  in 
2007 and Armenia in early 2008. Negotiations with Azerbaijan are still on-going. 

In the first half of 2007, the EIB signed (under the 2004-2007 Russia/WNIS mandate) its first 
loans in Ukraine and in the republic of Moldova. Both loans support the extension of Trans-
European transport Network axes. In the republic of Moldova, the EUR 30 million loan will 
improve  road  connections  of  the  Pan  European  Corridor  IX  (Moscow-Kiev-Bucharest) 
linking  the  capital  Chisinau  to  the  western  border  of  the  EU.  In  Ukraine,  EUR 200 million 
was lent for the rehabilitation of the major route, the Pan-European Corridor III, linking the 
capital of Ukraine with Hungary, Slovakia and Poland. 

8 

The numbers above cannot be added as a single operation and may contribute to several objectives.  

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28 

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Both  projects  will  contribute  to  eliminating  road  bottlenecks  and  improving  the  quality  and 
security  of  existing  infrastructure.  These  financings  will  have  a  direct  impact  in  terms  of 
closer  connectivity,  harmonisation  and  integration  between  the  enlarged  EU  and  its  Eastern 
Neighbours, with the ultimate goal of building an area of prosperity, stability and security. 

2.12.3.  Mediterranean Partner Countries 

Mandate-specific core objectives 

Support for enabling environment for private sector through strengthening of 
economic and social infrastructure  

Direct support for private sector, SMEs or micro-finance9 

Protection of environment/energy security of supply 

Number 
of 
operations 

6 

6 

2 

Total number of operations signed in 2007 

9 10 

Total EIB financing (EUR million) 

1 205 

More  than  half  (52%)  of  the  lending  volume  signed  in  the  Mediterranean  under  the  new 
mandate provides support to the private sector in the form of credit lines channelled through 
local financial intermediaries in Jordan, Lebanon, Syria and Tunisia. This type of operation, 
frequently  supported  by  grant-funded  technical  assistance,  also  frequently  contributes  to  the 
reform of the financial sector and the strengthening of the economic infrastructure. 

As part of the EIB pledge made at the Paris III conference to underpin the Lebanese recovery 
and  reconstruction  programme,  credit  lines  to  SMEs  for  a  total  of  EUR 295 million  were 
signed  in  Lebanon.  Quick  support  from  the  Lebanese  government,  in  conjunction  with  the 
commercial  banks  and  IFIs  including  the  EIB,  significantly  increase  the  chances  that 
companies decide to re-invest in Lebanon and restart operations after suffering large losses as 
a  result  of  the  recent  conflict.  In  cooperation  with  the  central  bank  of  Lebanon,  FEMIP 
technical assistance is provided to strengthen the financial intermediaries’ approach to credit 
analysis  and  structuring  of  long-term  loans  under  the  targeted  SME  reconstruction  facility. 
Additionally,  the  EIB  increased  its  direct  cooperation  with  leading  Lebanese  financial 
institutions  in  the  form  of  “stand-alone”  credit  lines,  in  contrast  to  the  traditional  state-
guaranteed form of operations. 

Another  EUR 200 million  credit  line  was  signed  in  Tunisia  in  order  to  continue  to  provide, 
through  selected  financial  intermediaries,  long-term  finance  to  local  SMEs.  This  operation 
fosters  a  more  diversified  market  economy  that  will  benefit  all  the  country’s  sectors  of 
activity  by  encouraging  enterprises  to  undertake  the  necessary  investment.  It  will  also  help 
Tunisian  companies  to  adjust  to  the  intensified  competition  arising  from  a  liberalised 
economy and progressive implementation of the free trade area with the European Union. 

9 

10 

To be noted that further support for the private sector was provided by risk capital operations funded by 
the  Community  budget  as  well  as  one  EUR  185  million  operation  signed  under  the  Mediterranean 
Partnership  Facility  II.  Including  these,  the  proportion  of  financing  in  support  of  the  private  sector 
reached 68% of total EIB financing in the Mediterranean in 2007. 
The numbers above cannot be added as a single operation may contribute to several objectives.  

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One loan was made directly with a private sector company to support an Israeli PPP project in 
the  water  sector.  This  project,  consisting  of  the  construction  of  a  reverse  osmosis  seawater 
desalination plant, also supports the objectives of protecting and improving the quality of the 
environment  and  protecting  human  health  through  the  provision  of  drinking  water.  Quality 
and  quantity  of  water  is  indeed  considered  to  be  one  of  the  most  serious  environmental 
problems currently facing the region. 

The  general  lending  priority  of  energy  security  of  supply  is  supported  in  the  Mediterranean 
region by two projects with total financing of EUR 280 million. In Morocco, the EIB finances 
the  expansion  and  optimisation  of  the  use  of  renewable  energy,  namely  hydropower.  This 
project  helps  also  to  address  the  impacts  of  climate  change  by  promoting  energy  efficiency 
and  reducing  air  pollution.  The  other  operation  consists  of  the  construction  of  two  modern 
natural gas-fired combined-cycle power plants, producing electricity at a competitive cost and 
with a relatively low environmental impact, to meet growing demand in Egypt. 

2.12.4.  Pre-Accession Countries 

Mandate-specific  core  objectives  (aligned  with  the  objectives  for  EIB 
lending within the EU) 

Number 
of 
operations 

Implementation of the Innovation 2010 Initiative (i2i) 

Extension of Trans-European Networks (TENs) 

Support for SMEs 

Environmental Protection and Sustainable Communities 

Support to Sustainable, Competitive and Secure Energy 

1 

5 

6 

4 

1 

Total number of operations signed in 2007 

 16 11 

Total EIB financing (EUR million) 

1 750 

EIB financing in Pre-Accession countries supports the countries’ preparation for accession to 
the  EU.  This  driving  principle  is  reflected  in  the  lending  objectives  which  –  in  addition  to 
covering  the  external  lending  objectives  set  out  in  Council  Decision  2006/1016/EC  –  are 
aligned with the objectives for EIB lending within the EU. Furthermore, EIB activity in the 
Pre-Accession  countries  reflects  the  priorities  established  in  the  Accession  and  European 
Partnerships, in the Stabilisation and Association agreements and in negotiations with the EU. 

Pre-Accession  countries’  private  sector  led  economic  growth  was  supported  by  a  total  of 
EUR 420 million in  credit  lines in  Turkey, Bosnia-Herzegovina and Kosovo. The  latter was 
the first EIB loan in this part of the Western Balkans. The expected benefits of most of the 
credit lines include support for the development of the countries’ financial system and of the 
SME  sector,  improved  competitiveness  of  the  industry,  contribution  to  environmental 
protection  and  to  the  rational  use  of  energy,  improvement  of  infrastructure  of  local  and 
regional interest. 

11 

The numbers above cannot be added as a single operation may contribute to several objectives. 

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The  extension  and  development  of  Trans-European  transport  Networks  in  the  region  was 
supported by 5 projects for a total EIB lending of EUR 199 million. A loan of EUR 60 million 
went to the construction of a motorway bypass for the Serbian capital Belgrade. The project 
will help to increase transport safety and capacity in Serbia, which is on the crossroads of the 
crucial trans-European corridors in the Western Balkans. Another loan in Serbia went to the 
rehabilitation of Belgrade’s Gazela Bridge. The project is co-financed with the EBRD and the 
European  Agency  for  Reconstruction.  Other  projects  extending  TENs  included  road 
rehabilitation programmes both in Serbia and in Bosnia-Herzegovina and the construction of 
an expressway between Levan and Vlorë in Albania. 

More than three quarters (EUR 1.33 billion) of total lending to Pre-Accession countries under 
mandate  was  absorbed  by  Turkey.  Almost  half  of  this  volume  went  to  large  transport 
infrastructure  projects,  namely  for  the  construction  and  rehabilitation  of  rail  infrastructure. 
Two of these supported sustainable urban public transport, in Izmir and in Antalya, while one 
project  concerns  the  construction  of  Turkey’s  first  high-speed  train  line  along  the  Istanbul-
Ankara corridor. The latter is implemented in parallel to assistance of the Commission in the 
context  of  the  Turkish  Rail  Sector  Re-Structuring  and  Strengthening  Project,  which  aims  at 
establishing  the  legislative  and  institutional  framework  of  the  Turkish  rail  sector  in 
accordance with the EU rules and regulations. Each of these transport projects encompasses 
significant environmental benefits. 

The  Innovation  2010  Initiative,  namely  research,  development  and  innovation  programmes, 
was supported by one EUR 400 million loan in Turkey. Programmes eligible under this loan 
comprise  the  key  areas  for  promoting  science  and  technology  in  Turkey  and  range  from 
academic  research  programmes  to  R&D  facilities  programmes  such  as  laboratories  and 
scientific equipment. 

Environmental  protection  was  the  main  lending  objective  of  42%  of  total  lending  under 
mandate  in  Pre-Accession  countries.  The  projects  financed  include  the  above-mentioned 
public transport projects in Turkey and a renewable energy project in Bosnia-Herzegovina for 
the  rehabilitation  of  hydropower  plants  and  electric  power  distribution  systems.  This 
investment  will  result  in  better  energy  efficiency  and  increased  quality  and  reliability  of 
power supply in the country. 

Bosnia-Herzegovina  was  the  second  recipient  country  in  the  region  with  15%  of  lending 
under mandate, Serbia received 8%, followed by Albania (1%). 

As  explained  in  section  2.5,  in  2007  the  EIB  Board  of  Governors  authorised  an  additional 
indicative  lending  envelope  of  EUR 5.5 billion  under  the  Pre-Accession  Facility  until  2010, 
which  favours  the  objective  set  out  in  Council  Decision  2006/1016/EC  that  financing  to 
candidate countries should increasingly take place under the Pre-Accession Facility. 

Moreover, in accordance with Recital 10 of Council decision 2006/1016/EC, the EIB seeks to 
encourage  the  institution  building  aspect,  where  relevant,  in  cooperation  with  the  other  IFIs 
active  in  the  Pre-Accession  region.  In  particular,  as  mentioned  in  section  2.9,  the  EIB  was 
actively involved in the work of the IFI-Advisory Group and its four sectoral working groups 
covering  transport,  energy,  environment  and  social  sectors.  Together  with  the  Commission, 
the EBRD and the CEB, the EIB is also actively involved in the Infrastructure Project Facility 
(IPF) to channel EC funds for technical assistance in support of priority infrastructure projects 
in Pre-Accession Countries. 

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2.12.5.  South Africa 

Mandate-specific core objectives 

Support for infrastructure projects of public interest  

Direct support for private sector, SMEs 

Protection of environment/energy security of supply 

Total number of operations signed in 2007 

Number 
of 
operations 

1 

1 

- 

2 

Total EIB financing (EUR million) 

113 

EIB financing in South Africa focuses on priority infrastructure investment programmes and 
the promotion of private sector growth. 

In 2007, two loans were signed in South Africa. The first loan, EUR 25 million equivalent in 
ZAR,  finances  the  expansion  of  a  particle  board  and  medium  density  fibreboard  factory,  to 
meet the strong growth in domestic demand arising from the furniture and construction sector. 
The  operation  directly  supports  private  sector  development  and  hence  viable  employment 
creation in one of the poorer provinces of the country. 

The  other  loan,  EUR 88 million  equivalent  in  ZAR,  is  the  second  tranche  of  a  larger  EIB 
financing  contribution  foreseen  for  the  construction  of  a  high  voltage  power  transmission 
interconnection  between  Johannesburg  and  Cape  Town.  This  project  will 
increase 
transmission  capacity  to  meet  the  growing  demand  in  the  Western  Cape  and  contribute  to 
reducing transmission constraints in the Southern African Power Pool. 

Although  no  signatures  were  made  under  the  new  lending  mandate,  38%  of  the 
EUR 900 million regional ceiling had, by end-2007, been attributed to projects approved by 
the Board. 

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2.13.  List of loans signed under the Community-supported mandates in 2007 

2.13.1.  Loans signed in Asia  

–  - under ALA III (2000-2007) mandate 

Country 

Project Description 

Loan 
amount 
(EUR 
million) 

Political 
Risk 
Guarantee 

  Philippines  Extension  and  upgrading  of  water  supply  and 

60.00 

Yes 

distribution infrastructure in Greater Manila 

Total Asia:

60.00 

2.13.2.  Loans signed in Latin America 

–  - under ALA III (2000-2007) mandate 

Country 

Project Description 

  Peru 

Purchase  and  installation  of  systems  for  provision  of 
telephony, high-speed internet, data transmission, cable 
and satellite pay-TV and VSAT services 

–  - under ALA IV (2007-2013) mandate 

Loan 
amount 
(EUR 
million) 

Political 
Risk 
Guarantee 

60.00 

Yes 

  Brazil 

  Panama 

Installation,  commissioning  and  operation  of  GSM 
overlay network operating in 850 MHz frequency range 
in  areas  of  Brazil  covered  by  promoter  in  order  to 
migrate from CDMA to GSM network 

Improvement of sanitation and environmental conditions 
in  Panama  City  through  construction  of  sewerage 
interceptor  and  wastewater 
network,  collectors, 
treatment plant 

250.00 

Yes 

27.14 

No 

  Uruguay 

Expansion  of  private  container  terminal  at  port  of 
Montevideo 

27.97 

Yes 

Total Latin America:

365.11 

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2.14.  Loans signed in the Eastern Europe, Southern Caucasus and Russia 

–  - under 2004-2007 (EUR 500 million) mandate 

Country 

Project Description 

Loan 
amount 
(EUR 
million) 

Political 
Risk 
Guarante
e 

  Republic  of 
Moldova,  

Rehabilitation  of  trunk  road  network  along  main  east-
west and north-south routes 

30.00 

No 

  Ukraine 

Rehabilitation  of  the  final  section  of  the  4-lane  M-06 
highway between Kiev and Brody, with a length of 427 
km,  on  Pan-European  Corridor 
III.  This  highway 
represents  the  most  important  arterial  route  of  Ukraine 
to the European Union. 

200.00 

No 

Total E. Europe, S. Caucasus and Russia:

230.00 

2.15.  Loans signed in the Mediterranean Partner Countries 

–  - under ENP-MED (2007-2013) mandate 

Country 

Project Description 

Loan 
amount 
(EUR 
million) 

Political 
Risk 
Guarante
e 

  Egypt 

Israel 

Construction  of  two  natural  gas-fired  combined-cycle 
power generation units in El Atf and Sidi Krir 

130.00 

No 

Construction  and  operation  of  desalination  plant  in 
Hadera  on  Mediterranean  coast  (about  50  km  north  of 
Tel Aviv) 

120.00 

Yes 

Jordan 

Financing for small and medium-scale ventures 

50.00 

Yes 

  Lebanon 

Financing of small and medium-scale projects 

195.00 

Yes 

  Financing,  through  Banque  de  Liban,  of  investment 
aimed at supporting SMEs affected by recent conflict 

100.00 

No 

  Morocco 

Construction  of  Fez  -  Taza  section  of  toll  motorway 
linking Fez to Oujda 

180.00 

No 

  Construction  of  hydro-powered  electricity  projects  and 
setting  up  of  an  automated  network  management 
system 

150.00 

No 

  Syria 

Co-financing  of  investment  projects  implemented  by 
private sector SMEs 

80.00 

No 

  Tunisia 

Financing of small and medium-scale projects 

200.00 

No 

Total Mediterranean:

1 205.00 

EN 

34 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.16.  Loans signed in the Pre-Accession Countries 

–  - under the South-Eastern Neighbours (2000-2007) mandate 

Country 

Project Description 

Loan 
amount 
(EUR 
million) 

Political 
Risk 
Guarante
e 

  Bosnia- 

Herzegovina 

Rehabilitation  of  hydropower  plants  and  distribution 
facilities 

103.00 

No 

  Financing for small and medium-scale ventures 

75.00 

Yes 

  Financing for small and medium-scale ventures 

10.00 

Yes 

  Financing for small and medium-scale ventures 

5.00 

Yes 

  Rehabilitation  of  pavement  of  number  of  sections  of 

50.00 

No 

main and regional road network 

  Financing  of  small  and  medium-scale  infrastructure 

20.00 

Yes 

schemes 

  Serbia 

Rehabilitation  of  E70/E75  motorway  crossing  Belgrade 
and of R251 ring road 

33.00 

No 

  Financing  for  small  and  medium-scale  ventures  (in 

10.00 

Yes 

Kosovo) 

  Rehabilitation of roads and bridges throughout country 

33.00 

  Turkey 

Construction  of  first  line  of  modern  tramway  system  in 
Antalya 

40.50 

No 

No 

  Construction  of  high-speed 

railway 

line  between 

132.36 

No 

Istanbul and Ankara 

  Upgrading  of  80  km  section  of  suburban  railway 
network  to  surface  metro  linking  Izmir  centre  to  Aliaga 
(north) and Cumoavasi (south) 

150.00 

No 

  Strengthening  of  Turkey's  science  and 

research 

400.00 

No 

capabilities 

  Financing of small and medium-scale ventures 

300.00 

No 

EN 

35 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
–  - under the Pre-Accession (2007-2013) mandate 

Country 

Project Description 

Loan 
amount 
(EUR 
million) 

Political 
Risk 
Guarantee 

  Albania 

Construction  of  new  expressway  between  Levan  and 
Vlorë 

23.00 

No 

  Serbia 

Construction  of  47  km  bypass,  of  which  27  km  of 
motorway  and  20  km  of  road,  on  Pan-European 
Transport Corridor X, west and south of Belgrade 

60.00 

No 

  Turkey 

Construction of high-speed railway line between Istanbul 
and Ankara 

304.86 

No 

Total Pre-Accession Countries:

1 749.72 

2.17.  Loans signed in South Africa 

–  - under the RSA (2000-2007) mandate 

Country 

Project Description 

Loan 
amount 
(EUR 
million) 

Political 
Risk 
Guarantee 

  South 
Africa 

Construction  of  high  voltage  power 
transmission 
interconnection between Johannesburg and Cape Town 

88.00 

No 

  Expansion  of  a  particle  board  and  medium  density 

25.00 

Yes 

fibreboard factory in White River 

Total South Africa:

113.00 

EN 

36 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.18.  EIB  lending  in  ACP/OCT  in  2007  (including  funding  from  own  resources  and 

by EDF) 12 

2.18.1.  Breakdown by region (EUR million) 

EIB Own 
resources

EDF 
resources 

Total 

ACP/OCT total 

Africa 

432

432

Regional - Africa 

West Africa & Sahel 

128

Central & East Africa 

Southern Africa & Indian Ocean 

304

Caribbean 

Pacific 

OCT 

Regional ACP 

325

254

8

222

25

56

2

10

3

756

686

8

128

222

328

56

2

10

3

12 

Amounts stated in this section rounded to the nearest EUR million. 

EN 

37 

   EN 

 
  
 
 
 
 
 
 
 
                                                 
2.18.2.  Breakdown by sector (EUR million) 

Energy 

Telecom  Water, 
sewerage

Industry 
& 
Services 

Credit 
lines 

Total 

ACP/OCT total 

Africa 

99

99

Regional - Africa 

West Africa & Sahel 

Central & East Africa 

99

Southern Africa & Indian 
Ocean 

15

15

15

42

42

28

14

Caribbean 

Pacific 

OCT 

Regional ACP 

511 

462 

8 

100 

55 

299 

46 

3 

90 

68 

68 

10 

2 

10 

756

686

8

128

222

328

56

2

10

3

EN 

38 

   EN 

 
  
  
  
  
  
  
 
 
  
 
 
 
  
 
 
 
 
 
 
  
 
 
 
  
 
 
 
  
2.19. 

Interest subsidies paid under the various Community mechanisms from 1995 to 
2007 

ECU/EUR million 

EC-subsidies 

EIB-subsidies 

Financial 
year 

Natural 
disasters 

Trans-European 
Networks 

EDF 

MEDA 

BOSNIA 

FYROM 

1995 

1996 

1997 

1998 

1999 

2000 

2001 

2002 

2003 

2004 

2005 

2006 

2007 

(1) 

Revised figure. 

6.1 

4.3 

4.0 

2.8 

2.2 

1.7 

1.3 

0.9 

0.6 

0.3 

0.2 

0.1 

25.0

18.0

37.0

20.0

71.0

54.0

15.0

14.3

4.0

13.26(1)

28.1

28.6

56.9

24.5

27.1

18.7

14.5

19.9

7.75

9.0

0.39

2.45

2.20

15.2

22.4

48.2

30.3

29.2

17.4

26.6

19.1

29.65

23.98

21.95

20.80

10.90

2.7

4.0

1.1

2.3

2.5

1.0 

2.76 

1.31

5.5 

0.63 

EN 

39 

   EN