Commission staff working document - Accompanying the the Report from the Commission to the Council and to the European Parliament on operations carried out under the eib external mandate in 2008 COM(2010)74 final
Date: 2010-03-04
Institutions: European Commission
Subjects: Community loan, EU financing, European Investment Bank, credit guarantee, financial control, foreign policy, impact study, interinstitutional cooperation (EU), international cooperation, report

EN 

EN 

   EN 

 
 
EUROPEAN COMMISSION 

Brussels, 4.3.2010 
SEC(2010) 186 final 

COMMISSION STAFF WORKING DOCUMENT 

Accompanying the 

THE REPORT FROM THE COMMISSION TO THE COUNCIL AND TO THE 
EUROPEAN PARLIAMENT ON OPERATIONS CARRIED OUT UNDER THE EIB 
EXTERNAL MANDATE IN 2008 

COM(2010)74 final 

EN 

   EN 

 
 
 
  
 
 
 
 
COMMISSION STAFF WORKING DOCUMENT 

Accompanying the 

THE REPORT FROM THE COMMISSION TO THE COUNCIL AND TO THE 
EUROPEAN PARLIAMENT ON OPERATIONS CARRIED OUT UNDER THE EIB 
EXTERNAL MANDATE IN 2008 

TABLE OF CONTENTS 

1. 

1.1. 

1.2. 

1.3. 

1.4. 

1.5. 

2. 

3. 

Contribution of EIB lending activity per geographical region..................................... 3 

Pre-Accession Countries .............................................................................................. 3 

Mediterranean Partner Countries ................................................................................. 6 

Eastern Europe, the Southern Caucasus and Russia .................................................... 9 

Asia and Latin America ............................................................................................. 11 

South Africa ............................................................................................................... 13 

List of loans signed under the Community-supported mandate in 2008 ................... 15 

List of operations co-financed with other IFIs and the Commission ......................... 19 

EN 

2 

   EN 

 
 
1. 

CONTRIBUTION OF EIB LENDING ACTIVITY PER GEOGRAPHICAL REGION 

This report reviews the implementation of the current EIB external mandate at regional and 
country  level  as  well  as  the  contribution  of  EIB  financing  operations  to  the  fulfilment  of 
external  policy  objectives,  taking  into  account  the  operational  objectives  of  the  EIB.  It  is 
recalled  that,  until  31  July  2007,  EIB  lending  continued  under  the  previous  2000-2007 
mandate and that those operations are not reflected in the tables that follow. 

1.1. 

Pre-Accession Countries  

1.1.1.  Activity by Country 

Table 1: Summary of lending signatures by Country 

Country 

Albania 

Bosnia and Herzegovina 

FYROM 

Montenegro 

Serbia 

Turkey 

TOTAL 

2007 

2008 

Tot 

N° ops 

EURm 

N° ops 

EURm 

N° ops 

EURm 

1 

- 

- 

- 

1 

1 

3 

23 

- 

- 

- 

60 

305 

- 

5 

1 

6 

3 

7 

- 

260 

10 

50 

170 

1519 

1 

5 

1 

6 

4 

8 

23 

260 

10 

50 

230 

1824 

388 

22 

2,009 

25 

2,397 

In  2008,  total  EIB  lending  under  the  mandate  in  Pre-Accession  Countries  totalled  EUR  2 
billions;  Turkey  accounted  for  75,6%  of  lending  while  24,4%  was  assigned  to  Western 
Balkans  Countries.  The  breakdown  of  EIB  activity  under  mandate  by  lending  objectives  is 
provided in section 1.1.2. below. 

In addition to EIB lending under mandate, a total of EUR 1.4bn of financing was signed in 
2008  at  the  EIB’s  own  risk  without  recourse  to  the  Community  guarantee  under  the  Pre-
Accession Facility. The largest part (EUR 920m) was directed towards the SMEs in Turkey 
and  Croatia  in  the  form  of  credit  lines  and  lease  financing.  Infrastructures  (namely  energy, 
including  renewable  energy,  transport  and  telecommunications)  in  Turkey  and  Serbia 
benefited  from  EIB  loans  totalling  EUR  322m  while  industrial  projects  in  Turkey  received 
EUR 203m. 

EN 

3 

   EN 

 
1.1.2.  Activity by Objective 

Table 2: Summary of signatures by region-specific key lending objectives 

Objective 

N° ops 

EURm 

N° ops 

EURm 

N° ops 

EURm 

2007 

2008 

Tot 

Knowledge economy (RTD, ICT, 
Education) 

Extension  of  Trans-European 
Networks (TENs) 

Support for SMEs 

Environmental  Protection  and 
Sustainable Communities 

Support 
Sustainable, 
Competitive and Secure Energy 

to 

TOTAL 

- 

2 

- 

1 

- 

3 

0 

83 

0 

1 

3 

7 

70 

86 

315 

1 

5 

7 

70 

169 

315 

305 

9 

1,504 

10 

1,809 

0 

2 

103 

2 

103 

388 

21* 

2,009* 

24* 

2,397* 

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

EIB financing  in  Pre-Accession countries reflects the  priorities established in the Accession 
and  European  Partnerships,  in  the  Stabilisation  and  Association  Agreements  and  in  EU 
accession negotiations. The lending priorities are also in line with EIB lending within the EU. 

Support  for  the  protection  of  environment  and  sustainable  communities  comprised  9 
projects  and  accounted  for  three  quarters  (EUR  1.5bn)  of  total  signatures  under  mandate  in 
Pre-Accession countries in 2008. The majority of EIB investments under this heading was in 
support of public transport infrastructures and urban renewal. 

•  Sustainable  communities  received  support  in  particular  in  Turkey,  where  the  EIB 
contributed  to  the  financing  of  three  large  public  transport  infrastructure  projects, 
namely  for  the  construction  and  rehabilitation  of  rail  infrastructure.  The  largest  project, 
Istanbul  Urban  Transport  II  comprises  EUR  700m  EIB  financing  to  extend  the  existing 
metro system and to integrate the city’s various public transport networks (light rail, tram 
and  bus).  By  cutting  road  traffic,  the  urban  environment  will  be  improved  in  terms  of 
congestion  and  pollution.  The  two  other  projects  in  Turkey  concerned  public  transport 
(light rail) networks in Bursa and Antalya respectively. 

•  Urban  renewal  and  regeneration  was  supported  by  two  EIB  financed  operations.  The 
first is a EUR 300m loan which aims at strengthening public buildings in Istanbul in order 
to increase their resistance to major earthquakes. Earthquake risk mitigation measures are 
rather important given considering Istanbul’s location on the North Anatolian fault-line as 
well as its population size and density. The project promoter will furthermore benefit from 
a  close  cooperation  with  a  specialised  “disaster”  group  within  the  World  Bank.  Another 

EN 

4 

   EN 

 
  
operation  supporting  urban  renewal  in  Serbia  benefits  from  EUR  50m  EIB  loan  for  the 
improvement  and  upgrading  of  municipal  infrastructures  mainly  covering  transport  and 
local/regional  roads,  education,  cultural  and  historical  heritage  and  public  buildings 
rehabilitation.  The  expected  benefits  include  in  particular  improved  quality  of  public 
facilities, increased traffic safety and reduction of congestion on the road network.  

•  Healthcare infrastructure in Serbia received in 2008 a second tranche of EUR 70m (from 
a  total  EIB  financing  of  EUR  200m)  foreseen  for  the  modernisation,  redevelopment  and 
extension of four tertiary care hospitals in major Serbian cities. The project represents an 
integral  and  critical  part  of  Serbia’s  healthcare  reform  which  has  also  benefited  from  a 
capacity building study commissioned by the European Agency for Reconstruction (EAR) 
in  2005  and  a  study  commissioned  by  the  World  Bank  in  2006  for  the  sector 
reconfiguration  strategy.  A  dedicated  Project  Implementation  Unit  will  be  in  charge  of 
following the project implementation with the support of technical assistance financed by 
the EAR. 

•  Water  and  sanitation  investments  received  EIB  financing  in  Bosnia-Herzegovina  and 
Montenegro.  In  Montenegro,  the  project  concerns  water  supply  and  urgent  investment 
schemes for collecting and treating municipal wastewaters. It will help bring the country’s 
infrastructure closer to the EU environmental standards, following the lines established by 
master  plans  funded  by  the  EU  and  completed  under  the  supervision  of  the  EAR.  Some 
project  components  form  part  of  the  Commission’s  Priority  Environmental  Investment 
Programme for the Balkan region.  

•  Environment  and  energy  received  EUR  200m  support 

two  financial 
intermediaries  in  Turkey  for  on-lending  to  finance  small  and  medium,  as  well  as 
potentially larger scale environment and energy investments, including renewable energy 
(wind,  solar,  biomass,  biofuels,  etc.),  pollution  abatement,  natural  gas  distribution  and 
energy  efficiency  (including  fuel  switching,  district  heating,  plant  modernisation) 
investments. The possibility of providing long-term funds also in the local currency (TRY) 
is envisaged.  

through 

Support for SMEs and private sector was supported by 7 operations signed under mandate 
for a total of EUR 315m1 financing to small and medium scale projects provided through local 
financial  intermediaries  in  Bosnia-Herzegovina,  Turkey,  Serbia,  Montenegro  and  FYROM. 
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. Given the prevailing financial crisis and its impact 
in terms of reduced liquidity in the financial markets of the Pre-Accession countries, the Bank 
already started to step up its lending in favour of SMEs via financial intermediaries in 2008. 
This effort is being reinforced in 2009. 

The provision of sustainable and competitive energy was supported by two direct operations. 
In  Turkey  a  EUR  100m  loan  was  signed  for  the  upgrade  and  extension  of  the  national 
electricity  distribution  networks  as  well  as  for  investment  in  measurement  and  tele-
information systems. The project will help to cope with the growing electricity demand and 

1 

An additional EUR 920m in credit lines for SMEs in Turkey and Croatia was signed under the EIB own 
risk Pre-Accession Facility (PAF) in 2008. 

EN 

5 

   EN 

 
                                                 
contribute  to  safer,  more  efficient  and  rational  use  of  the  energy  supply  system.  In 
Montenegro, the EIB co-financed the rehabilitation and upgrading of electricity infrastructure, 
comprising primarily transmission substations but also hydropower plants in Montenegro. The 
project represents a good example of EIB cooperation with the main IFIs and donors active in 
the region; parallel financing to the project is provided i.a. by the EBRD and EAR. Through 
the  inclusion  of  particular  undertakings  by  the  promoters,  the  project  will  underscore  the 
energy  policy  reforms  of  the  country  towards  the  creation  of  a  liberalised  and  competition-
based energy market in line with EU regulations and best practice.  

The extension and development of Trans-European transport Networks in the region was 
supported by three operations for a total EIB lending of EUR 86m. In Bosnia-Herzegovina, 
EUR 75m was provided for the construction of a new motorway section enabling the country 
to  connect  with  the  international  transit  corridors  (Corridor  Vc  extending  from  the  Croatian 
coast  to  Budapest  through  Bosnia-Herzegovina  and  through  Croatia  again  by  crossing 
Corridor X). Main benefits of the project derive from time savings and vehicle operating cost 
savings  relative  to  the  current  trunk  road  in  poor  condition.  In  Montenegro,  two  transport 
projects linking to TENs concerned the rehabilitation of a central railway axis as well as parts 
of  the  national  road  network.  Both  projects  are  co-financed  by  other  IFIs  and  benefit  from 
technical  assistance  financed  by  the  EAR.  The  railway  is  also  part  of  the  Core  Strategic 
Network  identified  by  the  EC  in  the  context  of  planning  the  continuation  of  TEN  routes  in 
European neighbouring states. 

1.2.  Mediterranean Partner Countries 

1.2.1.  Activity by Country 

Table 3: Summary of lending signatures by Country 

Country 

N° ops 

EURm 

N° ops 

EURm 

N° ops 

EURm 

2007 

2008 

Tot 

Egypt 

Israel  

Jordan 

Lebanon 

Morocco 

Syrian Arab Republic 

Tunisia 

TOTAL 

1 

1 

1 

2 

2 

1 

1 

9 

130 

120 

50 

295 

330 

80 

200 

1 

- 

1 

1 

3 

1 

4 

250 

0 

37 

52 

270 

275 

311 

2 

1 

2 

3 

5 

2 

5 

380 

120 

87 

347 

600 

355 

511 

1,205 

11 

1,195 

20 

2,400 

Table 3 shows that Tunisia, Syria, Morocco and Egypt, with respectively 26%, 23%, 22% and 
20%, accounted for some 91% of lending while the remaining 9% was assigned to Jordan and 
Lebanon. 

EN 

6 

   EN 

 
  
Lending  under  mandate  was  complemented  by  risk  capital  operations  funded  by  the 
Community  budget  as  well  as  by  two  loans  signed  under  the  Mediterranean  Partnership 
Facility II at EIB's own risk. Including these operations, the volume of 2008 signatures in the 
Mediterranean region reached some EUR 1.3bn.  

1.2.2.  Activity by Objective 

Table 4: Summary of signatures by region-specific key lending objectives 

Objective 

N° ops 

EURm  N° ops 

EURm 

N° ops 

EURm 

2007 

2008 

Tot 

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

6 

905 

10 

1,143 

16 

2,018 

Direct  support  for  private  sector,  SMEs  or 
micro-finance 

6 

745 

2 

107 

8 

852 

TOTAL 

9* 

1,205* 

11* 

1,195* 

20* 

2,400* 

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

As  one  of  the  main  financing  instruments  of  the  Euro-Mediterranean  partnership,  FEMIP 
continued its support to the Barcelona Process, which was reinforced at the summit of Heads 
of  State  and  Government  in  Paris  in  July  2008,  by  the  launch  of  the  Union  for  the 
Mediterranean.  The  summit  also  agreed  on  the  following  priority  initiatives  within  the 
mission of FEMIP:  

•  De-pollution of the Mediterranean Sea (Horizon 2020) 
•  Investment in terrestrial and maritime highways 
•  Renewable energy (Mediterranean solar plan) 

Since  2008,  FEMIP  also  stepped  up  the  Euro-Mediterranean  partnership  via  conferences  on 
specific issues, most recently on tourism, microfinance, climate change, and human capital.  

The bulk of FEMIP lending activities in 2008 addressed the creation of an investment-friendly 
environment  through  the  establishment  of  efficient  infrastructure.  In  particular,  70%  of 
lending  volume  signed  under  mandate  in  2008  contributed  to  the  economic  development  of 
the region through investments in the energy infrastructure. 

The  Mediterranean  partner  countries  are  experiencing  a  huge  increase  in  energy  demand, 
especially  for  electricity,  owing  in  particular  to  economic  development  and  the  needs  of  a 
growing population. Three areas for action continue to be the focus of FEMIP activity in this 
sector:  

•  Improved access to energy sources for the local population, 
•  Integration of the Euro-Mediterranean energy markets and 

EN 

7 

   EN 

 
•  Diversification of sources of supply, notably through the use of renewable energy. 

•  In Syria and Tunisia, the  EIB co-financed the construction of gas-fired dual-cycle power 
plants  which,  besides  catering  for  the  growing  electricity  demand,  will  also  improve  the 
power sectors’ fuel efficiency and environmental performance. 

•  In  Egypt  and  Morocco,  the  projects  comprise  developments  to  the  national  power 
transmission networks. In Egypt, the extension of the gas transmission system to new areas 
will allow replacing the use of fuel oil and LPG and reduce the cost of energy supply with 
resulting benefits for the consumers and the environment. The project will also increase the 
country’s  capacity  for  gas  exports  to  Jordan,  Syria,  Lebanon  and  Israel.  The  export 
component  supports  the  East  Mediterranean  Gas  Ring,  falling  under  one  of  the  TEN-E 
priorities.  

Four operations representing 21% of total lending under mandate contributed to develop the 
transport  infrastructure.  FEMIP’s  commitment  to  help  set  up  an  integrated  and  effective 
Euro-Mediterranean transport system will help to boost trade both to the EU and within the 
Mediterranean region, a pre-requisite for the region’s long-term economic development. 

•  In Tunisia, EUR 110m was extended to improve the urban road infrastructure. The project 
forms part of the programme of priority actions established under Tunisia’s 11th Economic 
and Social Development plan and will lead to improvement of the population’s quality of 
life. 

•  In  Morocco,  one  project  focuses  on  upgrade  and  reconstruction  of  15  000  km  of  rural 
roads, with a significant impact on the economic and social development of rural areas, on 
road traffic and the reduction in vehicle maintenance costs. The project is co-financed with 
several  other  IFIs  and  lenders  and  benefits  from  subsidy  and  technical  assistance  grant 
from the NIF.  

•  Another  loan  in  Morocco  finances  the  construction  of  a  second  container  terminal  at 
Tanger-Med port, a major infrastructure at the crossroads of the East - West and North - 
South maritime roads. The project will substantially improve Morocco’s infrastructure and 
maritime links for international trade. 

•  In Jordan, the EIB granted alongside other IFIs an increase to the loan in favour of Amman 
Ring Road project, the construction works of which started in 2006 and are ongoing. The 
project  forms  part  of  a  broad  package  of  developments  proposed  by  the  Government  of 
Jordan to improve transport provision and promote economic development in the Greater 
Amman  area.  Two  FEMIP  technical  assistance  operations  are  in  place  and  contribute  to 
project  preparation  as  well  as  elaboration  of  a  Strategic  Master  Plan  for  the  Amman 
Development Corridor. 

The proportion of financing in support of the private sector, including risk capital operations 
and  EIB  own  risk  lending,  represented  20%  in  terms  of  total  volume  and  60%  in  terms  of 
number  of  operations  (reflecting  the  smaller  average  size  of  private  sector  operations  in 
contrast to public sector typically consisting of large scale infrastructure projects). 

Credit  lines  for  SMEs  were  provided  through  three  private  Lebanese  banks  for  a  total  of 
EUR  52m.  This  financing  is  part  of  the  EIB  pledge  made  at  the  Paris  III  conference  to 
underpin the Lebanese recovery and reconstruction programme and represents a continuation 

EN 

8 

   EN 

 
of 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. The operation is 
structured under the Special FEMIP Envelope under which the EIB bears more risk.  

Finally, EUR 55m loan was made to a Tunisian private industrial enterprise, to finance the 
environmental  upgrading  of  a  number  of  large  phosphate  production  facilities.  Mining  and 
downstream mineral processing plays an important socio-economic role in Tunisia, hence the 
importance  of  accompanying  environmental  initiatives  to  ensure  minimising  pollution.  The 
project will result in a positive effect on the environment through significant reduction of SO2 
and  fluor  emissions.  An  interest  subsidy  for  the  project  has  been  earmarked  within  the 
National Indicative Programme (NIP) for Tunisia.  

In 2008, outside the Community guarantee, the EIB financed 9 risk capital operations in 
several  Mediterranean  Partner  Countries  for  the  amount  of  EUR  95m.  Two  loans  totalling 
EUR 33m in favour of projects in the pharmaceutical industry in Israel were signed under the 
EIB own risk Mediterranean Partnership Facility II.  

1.3. 

Eastern Europe, the Southern Caucasus and Russia 

1.3.1.  Activity by Country 

Table 5: Summary of lending signatures by Country 

2007 

2008 

Tot 

Country 

N° ops  EURm  N° ops 

EURm 

N° ops  EURm 

Republic of Moldova 

Ukraine 

TOTAL 

- 

- 

- 

0 

0 

0 

1 

1 

2 

20 

150 

170 

1 

1 

2 

20 

150 

170 

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  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  mandate  expanded  the  EIB’s  activities  to  include  the  Southern  Caucasus. 
Consequently,  Framework  Agreements  were  signed  with  Georgia  (in  2007)  and  Armenia  in 
early 2008 (entered into force in December 2008). Negotiations with Azerbaijan are still on-
going.  

The global financial and economic crisis had direct consequences on EIB activity in Eastern 
Neighbourhood  and  Russia.  Moreover,  the  conflict  with  Russia  in  Georgia  and  the 
political/economic instability in Ukraine prevented certain projects from being pursued. The 
EIB  participated,  together  with  the  Commission,  EBRD,  ADB  and  IFC  in  the  post-conflict 
joint  needs  assessment  in  Georgia  lead  by  the  World  Bank  and  the  United  Nations.  The 

EN 

9 

   EN 

 
 
 
conclusions  of  the  joint  needs  assessment  were  presented  at  the  Donors’  Conference  of 
October 2008 in Brussels, together with funding proposals from the donors.  

Two operations, in Ukraine and Republic of Moldova, were signed in the region in 2008.  

1.3.2.  Activity by Objective 

Table 6: Summary of signatures by region-specific key lending objectives 

Objective 

Transport 

Energy 

Telecommunications 

Environmental infrastructure 

TOTAL 

2007 

2008 

Tot 

N° ops  EURm  N° ops 

EURm 

N° ops  EURm 

- 

- 

- 

- 

- 

0 

0 

0 

0 

0 

1 

1 

- 

- 

2 

20 

150 

0 

0 

170 

1 

1 

- 

- 

2 

20 

150 

0 

0 

170 

Both  loans  signed  in  2008  contribute  to  the  development  of infrastructure,  namely  energy 
transmission and airport modernisation.  

•  In Ukraine, EUR 150m was extended for the construction of electricity transmission line 
between Kiev area and western Ukraine, enabling connections in the medium term to the 
Trans-European  Energy  Networks  (TEN-E).  The  project  will  reinforce  the  transmission 
network,  support  a  more  economic  use  of  generation  capacity,  improve  Ukraine’s 
participation in the European energy markets, reduce losses, thereby lowering the amount 
of greenhouse gas emissions and other harmful emissions in Ukraine, improve the security 
of  supply  to  the  Kiev  city  area  and  facilitate  the  closure  of  the  Chernobyl  750  kV 
substation, which is in a radioactively contaminated area.  

•  In  the  Republic  of  Moldova,  EUR  20m  loan  will  finance  investments  in  airside 
infrastructure  at  Chisinau  Airport,  which  is  the  sole  airport  serving  the  Republic  of 
Moldova.  The  investments  comprise  the  rehabilitation  of  the  airport's  runway  and 
taxiways, reconstruction and extension of the passenger apron and expansion of the arrival 
and  departure  halls  of  the  passenger  terminal.  Technical  assistance  is  foreseen  from  the 
Neighbourhood  Investment  Facility  (NIF)  to  support  all  stages  of  the  project  from 
feasibility study to the preparation of an airport master plan to implementation assistance 
and works supervision, which are key to project success. 

EN 

10 

   EN 

 
  
1.4. 

Asia and Latin America 

1.4.1.  Activity by Country 

Table 7: Summary of lending signatures by Country 

Country 

Brazil 

India 

Mexico 

Panama 

Paraguay 

Uruguay 

TOTAL 

2007 

2008 

Tot 

N° ops 

EURm 

N° ops 

EURm 

N° ops 

EURm 

1 

- 

- 

1 

- 

1 

3 

250 

0 

0 

27 

0 

28 

305 

1 

1 

1 

- 

1 

- 

4 

200 

150 

50 

0 

69 

0 

469 

2 

1 

1 

1 

1 

1 

7 

450 

150 

50 

27 

69 

28 

774 

In  November  2008  the  Council  adopted  the  decision  on  the  eligibility  of  5  Central  Asian 
countries  for  EIB  financing  under  the  Community  Guarantee,  which  has  been  confirmed 
under  the  Decision  of  the  European  Parliament  and  the  Council  of  13  July  2009.  A  first 
Framework Agreement governing EIB activities in Central Asia was signed with Tajikistan in 
early  2009.  The  focus  of  EIB  in  this  region  will  be  on  major  energy  supply  and  energy 
transport projects with cross-border implications. Like in Eastern Europe, Southern Caucasus 
and  Russia,  EIB  activity  in  Central  Asia  will  be  carried  out  in  close  cooperation  with  the 
EBRD, pursuant to the EC-EBRD-EIB tripartite MoU. 

In  2008  four  operations  totalling  EUR  469m  were  signed  in  the  ALA  region  with  Brazil 
receiving 42.6% of the total lending amount. A first loan of EUR 150m was signed under the 
Asia envelope2. 

2 

In  addition  to  the  total  EIB  financing  under  mandate,  the  EIB  Board  of  Directors  approved  the 
allocation of EUR 220m for three projects that contribute to the mitigation of climate change within the 
EUR 500m China Climate Change Framework Loan, which was signed in 2007 under the EIB own risk 
Facility for Energy Sustainability and Security.  

EN 

11 

   EN 

 
  
                                                 
1.4.2.  Activity by Objective  

Table 8: Summary of signatures by region-specific key lending objectives 

Objective 

N° ops  EURm  N° ops  EURm  N° ops  EURm 

2007 

2008 

Tot 

Support 
in  ALA 
for  EU  presence 
(European  FDI,  transfer  of  European 
technology) 

Support of environmental sustainability  

(including climate change mitigation) 

TOTAL 

2 

278 

4 

469 

6 

747 

1 

3 

27 

2 

200 

3 

227 

305 

4* 

469* 

7* 

774 

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

The  2007-2013  mandate  introduced  as  new  focus  areas  for  EIB  activity  in  ALA,  namely 
investments contributing to environmental sustainability, including climate change mitigation, 
or to the energy security of the EU. 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.  Moreover,  the  Council  invited  the  Bank  to  progressively  expand  its  activities 
across a larger number of countries in ALA, including in less prosperous countries.  

In 2008, lending activity in Latin America in support of European foreign direct investment 
was  affected  by  the  downward  revision  of  investments  planned  in  the  region  by  some 
European companies. Four operations, all of which supported EU presence in ALA region, 
were  signed  in  2008.  Two  of  these  are  indirect  operations  (through  local  financial 
intermediaries) and additionally contribute to the environmental sustainability objective, by 
supporting a series of investments by private and public sector operators.  

•  In India, the EUR 150m framework loan supports the financing of renewable energy and 
energy efficiency projects in line with the EU-India Strategic Partnership, which foresees 
i.a.  cooperation  in  curbing  climate  change.  It  represents  a  direct  follow-up  on  the  Joint 
Statement issued at the EU-India summit of November 2007, which stated that “India and 
the  EU  welcomed  the  steps  taken  by  the  EIB  in  India  to  establish  loan-based  project 
funding  under  its  new  Asia  lending  mandate,  and  in  particular  with  reference  to  the 
financing instruments supporting projects in the fields of energy sustainability and climate 
change mitigation”. 

•  In Mexico, EUR 50m was extended to one of the country’s main public development bank, 
which  will  be  managing  the  Mexican  Carbon  Fund  in  order  to  support  environmental 
projects, in particular Clean Development Mechanism projects. The loan is consistent with 
the  EU  policy  and  strategy  on  climate  change,  which  calls  for  the  identification  of  new 
tools to strengthen developing country participation in global efforts to address the climate 
change. This is a pilot operation in a country that offers huge potential for projects tackling 
climate change. 

The  two  other  operations  signed  in  2008  supporting  EU  presence  in  ALA,  are  loans  to  the 
subsidiaries  of  European  telecommunications  companies  for  the  expansion  of  mobile 

EN 

12 

   EN 

 
telecommunications networks in Brazil and in Paraguay. Access to telecommunications is of 
key importance in promoting economic development and fighting poverty.  

•  In Brazil, the project will contribute to developing innovative IT infrastructure, as well as 
facilitating  improved  internet,  multimedia  and  telecommunications  services.  The  project 
has  significant  developmental  potential  as  it  will  contribute  to  providing  broadband 
telecom  services  where  fixed  networks  have  a  relatively  low  level  of  diffusion  and/or 
quality. The EIB loan (EUR 50m) will be allocated to investments in the regions of Brazil 
with an income considerably below the national average. 

•  In Paraguay, the operation meets to the Council’s invitation to diversify EIB financing also 
to the less prosperous countries; the project is located in one of the poorest countries in the 
region, where EIB had not yet established a presence. The EUR 68.5m EIB financing will 
allow  GSM  network  coverage  of  all  cities  with  more  than  5000  inhabitants  and  further 
increase the population coverage to about 83%. This is particularly important in a country 
with a very low fixed-line density (8 mobile phones for one fixed line). By migrating the 
local subscriber base to GSM, the project also supports the EU policy goal of promoting 
interoperable technologies. 

1.5. 

South Africa 

1.5.1.  Signatures by Objective 

Table 9: Summary of signatures by region-specific key lending objectives 

2007 

2008 

Tot 

Objective 

N° ops  EURm  N° ops  EURm  N° ops  EURm 

Support  for  infrastructure  projects  of  public 
interest 

Direct support for private sector, SMEs 

TOTAL 

- 

- 

- 

0 

0 

0 

1 

150 

1 

150 

3 

203 

3 

203 

3* 

203* 

3* 

203* 

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

EIB  financing  in  the  Republic  of  South  Africa  (RSA)  focuses  on  priority  infrastructure 
investment programmes and the promotion of private sector growth. All 3 operations signed 
in  2008  provided  support  for  the  private  sector.  One  of  these  also  meets  the  other  main 
objective of the RSA mandate as it supports urban infrastructure regeneration. This operation 
involves  EUR  150m  EIB  financing  provided  through  three  private  sector  and  two  public 
sector  financial  intermediaries  for  funding  the  supply  of  affordable  and  social  housing  and 
associated urban infrastructure including social amenities, throughout RSA. The improvement 
of housing conditions for the low-income population plays an important role in the national 
development strategy of RSA and is in accordance with the EU-RSA Country Strategy which 
focuses  on  the  reduction  of  poverty  and  inequality,  as  well  as  the  creation  of  an  enabling 
environment for economic growth and development. The operation complements EC actions 
(provision  of  technical  assistance  for  capacity  building  for  Social  Housing  Institutions)  as 
well  as  Netherlands  Development  Finance  Company  and  Agence  Française  de 

EN 

13 

   EN 

 
  
Développement  (provision  of  subsidised  mortgage  finance  for  commercial  financial 
intermediaries and of funding for the supply of housing).  

An  innovative  medium-sized  private  sector  start-up  project  benefited  from  EUR  40m  EIB 
financing  under  the  Structured  Finance  Facility.  The  project  involves  the  construction  of  a 
production  facility  for  thin-film  photo-voltaic  (PV)  modules,  which  represent  an  important 
component  for  the  renewable  energy  sector.  The  production  process  involves  an  innovative 
locally-developed technology which is characterised by lower raw material costs than silicon-
based modules and will contribute to the learning effect that is expected to gradually reduce 
the costs in the PV industry. The new plant will provide PV systems to schools and clinics in 
rural  communities,  where  PV  is  already  often  more  cost-effective  than  power  grid 
development, as well as making micro-sized installations for individual homes.  

The  EIB  also  lent  EUR  12.5m  to  support  the  establishment  of  a  greenfield  metal  coating 
production facility in South Africa. The project will help to build commercial capacity in the 
South  African  steel  industry.  The  metal  coating  sheets  produced  by  the  promoter  are  used 
extensively  in  the  residential  roofing  market.  Through  increased  availability  of  cheaper  and 
more  reliable  roofing  material  for  housing,  the  project  will  contribute  to  improving  living 
conditions.  

EN 

14 

   EN 

 
2. 

LIST OF LOANS SIGNED UNDER THE COMMUNITY-SUPPORTED MANDATE IN 2008 

Loans signed in the Pre-Accession countries 

Country 

Project Description 

Loan 
Amount 
(EUR m) 

Political 
Risk 
Guarantee3 

and 
Bosnia 
Herzegovina 

Construction  of  15  km  motorway  section  between  Drivusa  and 
Kakanj in Corridor Vc 

75.00 

No 

Bosnia 
and 
Herzegovina 

Bosnia 
and 
Herzegovina 

and 
Bosnia 
Herzegovina 

Financing of small and medium-scale infrastructure projects 

75.00 

Yes 

Financing of small and medium-scale projects 

50.00 

Yes 

Rehabilitation and construction of water and sanitation facilities 

60.00 

No 

  FYROM 

Financing for small and medium-scale ventures 

10.00 

Yes 

Montenegro 

Urgent  rehabilitation  and  modernisation  of  Podgorica  and  Tivat 
airports 

1.00 

No 

  Montenegro  Financing of small and medium-scale projects 

30.00 

Yes 

Montenegro 

Rehabilitation  of  railway  infrastructure  on  main  line  crossing 
Montenegro and acquisition of rolling stock 

7.00 

No 

Montenegro 

Rehabilitation  and  construction  of  municipal  water  and  sanitation 
infrastructure 

5.00 

No 

Montenegro 

Rehabilitation  and  upgrading  of  electricity  infrastructure  in  Serbia 
and Montenegro 

2.98 

No 

  Montenegro  Rehabilitation of roads and bridges throughout country 

4.00 

No 

Serbia 

Modernisation,  redevelopment  and  extension  of  four  tertiary  care 
hospitals in Serbia (Belgrade, Niš, Novi Sad and Kragujevac) 

70.00 

No 

  Serbia 

Lease financing of small and medium-scale projects 

50.00 

Yes 

  Serbia 

Financing of small and medium-scale infrastructure projects 

  Turkey 

Construction of first line of modern tramway system in Antalya 

  Turkey 

Extension of light rail transit system in city of Bursa 

50.00 

19.00 

100.00 

No 

No 

No 

Turkey 

Framework loan for financing small and medium-scale infrastructure 
projects in the fields of environment and energy 

200.00 

No 

3 

The Political Risk Guarantee column highlights the operations where, in contrast to sovereign or 
equivalent risk perations covered by the Comprehensive Guarantee, the Community assumes defined 
political risks while the EIB assumes all other risks. 

EN 

15 

   EN 

 
  
 
 
 
 
 
 
 
 
 
 
                                                 
Turkey 

Strengthening  of  public  buildings  in  Istanbul  aimed  at  increasing 
city's resistance to major earthquakes 

300.00 

No 

  Turkey 

Extension of Istanbul's public transport network 

700.00 

Yes 

  Turkey 

Upgrading and extension of national electricity distribution networks 

100.00 

   Turkey 

Financing of small and medium-scale projects 

100.00 

2008.98 

No 

No 

Loans signed in the Mediterranean countries 

   Country 

Project Description 

  Egypt 

Extension of national high-pressure gas transmission network 

Jordan 

Construction of Amman Ring Road 

Loan 
Amount 
(EUR 
m) 

250.00 

36.92 

Political 
Risk 
Guarantee 

No 

No 

  Lebanon 

Financing of small and medium-scale projects 

52.00 

Yes 

  Morocco 

Upgrading of power transmission network throughout Morocco 

170.00 

No 

  Morocco 

Construction of second container terminal at Tanger-Med port 

40.00 

Yes 

  Morocco 

Construction of around 15 500 km of rural roads over period 2005-2015 

60.00 

No 

Syria 

Construction  of  natural  gas-fired  combined-cycle  power  plant  located  25 
km south of Damascus 

275.00 

No 

Tunisia 

Tunisia 

Tunisia 

Upgrading  of  Groupe  Chimique  Tunisien's  existing  production  facilities 
aimed at improving environmental protection in Skhira and M’Dhilla near 
Gabès 

55.00 

No 

Construction  and  operation  of  dual-fired  combined-cycle  power  plant  in 
Ghannouch 

86.00 

No 

Development  of  Tunisia’s  natural  gas  transmission  and  distribution 
network 

60.00 

No 

   Tunisia 

Improvement of urban road infrastructure in Tunisia 

110.00 

No 

1194.92 

EN 

16 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
  
  
  
 
 
 
 
 
Loans signed in the Eastern Europe, Southern Caucasus and Russia 

   Country 

Project Description 

Loan 
Amount 
(EUR 
m) 

Political 
Risk 
Guarantee 

Moldova, 
Republic 
of 

Modernisation  of  airside  infrastructure  and  expansion  of  terminal  at 
Chisinau airport 

20.00 

No 

   Ukraine 

Construction of electricity transmission line between Rivne and Kiev 

150.00 

No 

Loans signed in Asia 

   Country 

Project Description 

170.00 

Loan 
Amount 
(EUR 
m) 

Political 
Risk 
Guarantee 

India 

Framework  loan  for  financing  renewable  energy  and  energy  efficiency 
projects 

150.00 

No 

Loans signed in Latin America 

   Country 

Project Description 

150.00 

Loan 
Amount 
(EUR 
m) 

Political 
Risk 
Guarantee 

  Brazil 

Expansion and upgrading of digital mobile telecoms network 

200.00 

Yes 

Mexico 

Financing  of  small  and  medium-scale  environmental 
schemes 

infrastructure 

50.00 

No 

   Paraguay 

Expansion of GSM network 

68.50 

Yes 

318.50 

EN 

17 

   EN 

 
 
 
 
  
  
  
 
 
 
 
 
 
  
 
  
  
  
 
 
 
  
  
  
 
 
 
 
 
Loans signed in South Africa 

   Country 

Project Description 

Loan 
Amount 
(EUR 
m) 

Political 
Risk 
Guarantee 

South 
Africa 

South 
Africa 

South 
Africa 

Financing  of  affordable  social  housing  and  related  urban  infrastructure, 
including social amenities, throughout South Africa 

150.00 

Yes4 

Construction  of  production  facility  for  thin-film  photovoltaic  modules  in 
Paarl (Western Cape) 

40.00 

Yes 

The construction of a metal sheet roofing complex in South Africa 

12.55 

No 

202.55 

4 

The  facility  is  made  available  to  five  intermediaries,  of  which  two  are  public  (with  comprehensive 
guarantee) and three are private (political risk guarantee only). 

EN 

18 

   EN 

 
 
 
 
  
 
  
  
  
                                                 
3. 

LIST OF OPERATIONS CO-FINANCED WITH OTHER IFIS AND THE COMMISSION 

Mandate  Country 

Contract name 

Project 
cost 
(EURm) 

EIB loan 
signed in 
2008 
(EURm) 

Multilateral
Financing 
Institutions 

European 
Bilateral 
Institutions 

EC 
contributions 

Co-financed operations under the external lending mandate 

Republic 
of 
Moldova 

ENP-EAST 

ENP-EAST  Ukraine 

MOLDOVA 
CHISINAU AIRPORT 

RIVNE-KYIV HIGH 
VOLTAGE LINE 

48.90 

20.00 

300.00 

150.00 

ENP-MED 

Jordan 

AMMAN RING 
ROAD B 

287.40 

36.92 

ENP-MED  Morocco 

ROUTES RURALES 
III 

396.80 

60.00 

ENP-MED  Morocco 

ONE - RESEAUX 
ELECTRIQUES II 

587.00 

170.00 

ENP-MED 

Syria 

DEIR ALI II POWER 
PLANT 

722.70 

275.00 

ENP-MED 

Tunisia 

STEG II 

133.00 

60.00 

ENP-MED 

Tunisia 

GCT MISE A NIVEAU 
ENVIRONNEMENTA
LE 

149.50 

55.00 

ENP-MED 

Tunisia 

STEG CENTRALE DE 
GHANNOUCH B 

405.00 

86.00 

Pre-
Accession 

Bosnia-
Herzeg. 

CORRIDOR VC - 
FIRST PHASE - 
NORTH 

Pre-
Accession 

Monteneg
ro 

Pre-
Accession 

Monteneg
ro 

POWER SECTOR 
RECONSTRUCTION 
B 

ROADS AND 
BRIDGES 
REHABILITATION 
A2 

158.40 

75.00 

140.00 

2.98 

144.90 

4.00 

Pre-
Accession 

Monteneg
ro 

MONTENEGRO 
RAILWAYS II 

68.07 

7.00 

Pre-
Accession 

Monteneg
ro 

MONTENEGRO 
WATER AND 
SANITATION B 

114.00 

5.00 

EN 

19 

   EN 

 
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
Pre-
Accession 

Serbia 

CLINICAL CENTERS 
B 

430.00 

70.00 

Pre-
Accession 

Pre-
Accession 

Pre-
Accession 

Pre-
Accession 

RSA 

Turkey 

Turkey 

Turkey 

Turkey 

South 
Africa 

TEDAS 
ELECTRICITY 
DISTRIBUTION B 

ISTANBUL URBAN 
TRANSPORT II 

ISTANBUL 
EARTHQUAKE RISK 
MITIGATION 

TURKISH 
EXIMBANK SME GL 

SAFAL STEEL 
PLANTS 

650.00 

100.00 

1551.00 

700.00 

875.00 

300.00 

400.00 

100.00 

159.02 

12.55 

7720.69 

2289.44 

Co-financed risk capital operations (Community budget, ENPI) 

ENPI RC 

Regional 
Med  

ALTERMED B 

ENPI RC 

Egypt 

ENPI RC 

Syria 

ENPI RC 

Egypt 

ENPI RC  Morocco 

BELTONE MIDCAP 
FUND 

FIRST 
MICROFINANCE 
INSTITUTION SYRIA 

SPHINX 
TOURNAROUND 
FUND 

FONDS CAPITAL 
CARBONE 

75.00 

3.00 

80.00 

12.50 

12.00 

2.00 

65.00 

13.00 

26.00 

6.50 

258.00 

37.00 

EN 

20 

   EN