Report from the Commission to the European Parliament and the Council on the mid-term review of the external mandate of the EIB {SEC(2010) 442 final}
Date: 2010-04-21
Institutions: European Commission
Subjects: ACP countries, European Investment Bank, activity report, foreign policy

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EUROPEAN COMMISSION 

Brussels, 21.4.2010 
COM(2010) 173 final 

REPORT FROM THE COMMISSION 
TO THE EUROPEAN PARLIAMENT AND THE COUNCIL 

ON THE MID-TERM REVIEW OF THE EXTERNAL MANDATE OF THE EIB 

{SEC(2010) 442 final} 

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TABLE OF CONTENTS 

1. 

2. 

2.1. 

2.2. 

Introduction .................................................................................................................. 3 

Relevance and performance of EIB operations by regions.......................................... 3 

Pre-Accession countries ............................................................................................... 4 

Neighbourhood Countries ............................................................................................ 5 

2.2.1.  Mediterranean Neighbourhood .................................................................................... 5 

2.2.2.  Eastern Neighbourhood and Russia ............................................................................. 6 

2.3. 

2.4. 

3. 

3.1. 

3.2. 

4. 

4.1. 

4.2. 

5. 

Asia and Latin America (ALA).................................................................................... 7 

South Africa ................................................................................................................. 7 

Value Added of EIB operations and EU guarantee ..................................................... 8 

Financial value-added .................................................................................................. 8 

Non-financial value added ........................................................................................... 9 

Cooperation with the Commission and with IFIs/EBFIs ........................................... 10 

Cooperation with the Commission............................................................................. 10 

Cooperation with IFIs/EBFIs ..................................................................................... 10 

Conclusion.................................................................................................................. 11 

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1. 

INTRODUCTION 

The activities of the European Investment Bank (EIB) outside the EU represent about 10% of 
the EIB's total activities. In 2009, projects signed outside the EU amounted to EUR 8.8 bn out 
of an overall EIB financing of EUR 79.1 bn.  

The majority of EIB external financing operations benefits from an EU budgetary guarantee 
covering risks of a sovereign or political nature. This guarantee is provided in the means of a 
mandate (the so called 'external mandate') that takes the form of a decision by the Parliament 
and Council. Most recently, the EU guarantee was renewed by Decision No 633/2009/EC of 
the European Parliament and of the Council of 13 July 20091 (the ‘Decision’). The external 
mandate  for  2007-2013  currently  covers  64  countries  and/or  territories  in  Pre-Accession, 
Neighbourhood, Asian and Latin American countries as well as the Republic of South Africa. 

In  contrast,  EIB  activity  in  ACP  countries  is  covered  by  the  separate  ACP-EU  Partnership 
Agreement (the 'Cotonou agreement'), funded by the European Development Fund (EDF)2. 

In  addition  to  EIB  lending  under  the  external  mandate,  and  to  that  covered  by  the  Cotonou 
Agreement,  the  EIB  may  lend  in  third  countries  at  its  own  risk  for  investment-grade 
operations on the basis of Article 16 of its Statute. 

Article  9  of  the  Decision  requires  the  Commission  to  present  a  mid-term  report  on  its 
application accompanied by a proposal for its amendment, drawing inter alia on an external 
evaluation.  The  present  Communication  (the  'Report')  and  the  attached  Staff  Working 
Document (SWD) - together hereinafter referred to as the 'evaluation' - draw on an external 
evaluation supervised and managed by a Steering Committee of Wise Persons (SCWP), on an 
evaluation carried out by an external consultancy (COWI), and on specific evaluations carried 
out  by  the  evaluation  department  of  the  EIB.  The  evaluation  presents  and  assesses  EIB 
financing activity under the current mandate until the end of 2009. The SWD also includes a 
detailed presentation of EIB external financing activity in 2009. The whole package therefore 
constitutes  the  mid-term  report  foreseen  in  Article  9  of  the  Decision  as  well  as  the  2009 
annual  reporting  foreseen  in  Article  6  of  the  Decision.  The  findings  of  the  Report  form  the 
basis for the accompanying legislative proposal for amendment of the Decision. 

2. 

RELEVANCE AND PERFORMANCE OF EIB OPERATIONS BY REGIONS 

The evaluation found that EIB operations under mandate carried out between 2000 and 2009 
were in line with EU external policies, whilst recognising that the latter were defined broadly 
leaving  ample  scope  for  the  EIB  to  intervene  in  most  sectors  of  investment  activity.  The 
evaluation  found  that  a  strategic  prioritisation  of  objectives  would  have  better  helped  target 
key EU policy objectives. Therefore, it suggests establishing a clearer link between EU policy 
objectives and their operational implementation by the EIB. 

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Decision granting a Community guarantee to the European Investment Bank against losses under loans 
and loan guarantees for projects outside the Community (OJ L 190, 22.7.2009, p. 10). 
In addition, the EIB makes an own resources facility available for lending in ACP countries, covered by 
a guarantee from the Member States. 

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Furthermore, the evaluation concluded that the current system of fixing regional objectives in 
the recitals of the mandate decision is relatively rigid as it does not take into account evolving 
EU  policies,  priorities  and  changing  circumstances.  At  the  same  time,  the  existing  system 
carries the risk that the EIB pursues too many different objectives, limiting the scope for the 
EIB to provide value added in its areas of comparative advantage. 

The  following  table  presents  the  amounts  signed  by  the  EIB  under  EU  guarantee,  broken 
down by regions. At the end of 2009, after 3 years of the 7-year mandate, or 43% of elapsed 
time,  overall  46%  of  the  total  ceiling  for  the  mandate  had  been  signed.  However,  there  are 
significant  regional  differences:  the  utilisation  of  the  mandate  has  been  particularly  high  in 
Pre-Accession  countries  and  in  Asia;  has  been  in  line  with  average  for  the  Southern 
Neighbourhood and Latin America; and low in the Eastern Neighbourhood and Russia. Given 
good progress to date in implementation of the mandate, and frontloading of EIB financing in 
response to the crisis which is likely to continue through 2010, it is possible that the EIB will 
reach  some  regional  ceilings  before  the  end  of  the  mandate  period,  notably  in  the  Pre-
Accession and the Asia and Latin America (ALA) regions. 

Table 1 - Level of commitment under the 2007-2013 mandate at end 2009 

Financing ceiling 
for 2007-2013 
(€ mn) 

Net signatures at  
31.12.2009 
(€ mn) 

Net signatures at  
31.12.2009 
(% of ceiling) 

Pre-Accession 

Southern Neighbourhood 

Eastern Neighbourhood & Russia 

Asia 

Latin America 

South Africa 

Total 

8,700

8,700

3,700

1,000

2,800

900

5,262 

3,860 

403 

616 

1,305 

483 

25,800

11,929 

60

44

11

62

47

54

46

The SWD contains a detailed analysis of the distribution of EIB financing under mandate by 
sector, overall and per region, as well as disbursement rates. 

2.1. 

Pre-Accession countries 

The scope of the mandate for Pre-Accession countries is the widest of the regional mandates, 
as  the  EIB  may  support  the  broad  priorities  of  the  Accession  and  European  Partnership 
agreements, and of the Stabilisation and Association Agreements. 

EIB  financing  in  current  Pre-accession  countries  grew  substantially  over  the  period  2000-
2009, both under Community guarantee and at the own risk of the Bank, in particular due to 
the strongly increased activity in Turkey (from an average EUR 500 mn/year during the early 
years of the 2000-2007 period to more than EUR 2.5 bn/year in 2008 and 2009). In 2009, the 
total EIB lending in Pre-Accession countries reached EUR 4.3 bn, of which EUR 2.9bn under 
EU guarantee. 

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The  main  area  of  activity  has  been  the  transport  sector  with  50%  of  total  lending  volume 
under the previous mandate and 39% so far under the current one. This is followed by global 
loans,  mostly  for  SMEs,  which  grew  from  22%  to  30%  between  the  two  mandates.  The 
significant increase of activity in the SME sector over the last few years has been determined 
by the need to support the financial sector in Central and Eastern Europe in order to finance 
the  real  economy  during  the  financial  crisis.  These  efforts  also  led  the  EIB  to  closely 
cooperate with the EBRD and the World Bank Group under a Joint IFI Action Plan. In 2008 
and  2009,  global  loans  for  SME  financing  amounting  to  EUR  3.8bn  were  signed  in  pre-
accession countries corresponding to 49% of total EIB operations. Correspondingly, the level 
of annual disbursements doubled the one achieved in 2007. 

The evaluation found that the EIB has provided significant support to Pre-Accession countries 
in  the  context  of  the  enlargement  process  by  financing  relevant  projects  and  promoting  EU 
policies.  Nevertheless,  the  share  of  lending  for  environmental  infrastructure  has  been  low 
(respectively  4%  and  2%  of  lending  volume  under  the  two  mandates)  and  should  be 
significantly  enhanced,  in  line  with  the  priority  attached  to  this  sector  under  the  acquis 
communautaire  and  the  high  investments  required  to  meet  the  obligations  deriving  from  it. 
Projects in environmental infrastructure had a particularly low disbursement rate because of 
their inherent complexity and administrative burden, which make it necessary to reinforce the 
resources dedicated by the EIB to project preparation and supervision in this sector, including 
through  technical  assistance.  Finally,  the  evaluation  found  that  the  EIB  could  have  helped 
promoters  to  develop  projects  in  several  cases  if  it  had  available  more  staff  and  technical 
assistance  means,  but  specifically  stopped  short  of  suggesting  that  the  EIB  be  involved  in 
more general institution building which in any case is not in its remit. 

2.2. 

Neighbourhood Countries 

2.2.1.  Mediterranean Neighbourhood 

In the Mediterranean region, particularly following the introduction of FEMIP3, the focus of 
the EIB was to promote the development of the private sector and an enabling environment, 
including  investment  in  economic  infrastructure  in  transport,  energy,  environment  and 
telecommunications. After the introduction of FEMIP in 2002 and its reinforcement in 2006, 
EIB activity  has  been  increasingly recognised as a valuable component of  Euro-Med policy 
and  the  Union  for  the  Mediterranean.  Annual  lending  increased  from  an  average  EUR 
773mn/year  in  2000-2002  to  EUR  1.378mn/year  in  2007-2009.  While  EIB  lending  reached 
the  overall  ceiling  under  the  previous  mandate  and  while  lending  rates  under  the  current 
mandate  are  in  line  with  expectations,  so  far  the  implementation  of  the  own  risk 
Mediterranean Partnership Facilities has been  slower.  Under these own risk facilities a total 
EUR 2bn4 has been made available by the EIB Board of Governors for 2007-2013, of which 
only 14% was committed at the end of 2009. 

The  FEMIP  framework,  which  involves  a  close  combination  of  EIB  lending  with  grant 
resources made available under the EU budget for technical assistance and risk capital, along 
with close involvement of partner countries in the strategic planning of EIB activities, means 
that there is strong political anchoring of EIB activity within EU priorities. 

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Facility for Euro-Mediterranean Partnership. 
As regards the 2000-2006 period, EUR 1 bn was made available under the Mediterranean Partnership 
Facility I, of which EUR 0.63 bn was committed. 

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Under  the  current  mandate,  private  sector  lending  represented  35%  of  total  signatures 
compared to 23% under the previous mandate. The increase has been driven by global loans 
for  SMEs  (which  accounted  for  16%  of  total  lending  under  the  new  mandate),  by  private 
industrial  investments  (10%)  and  by  the  promotion  of  private  sector  involvement  through 
Public-Private-Partnerships  (PPPs)  in  environmental  and  other  infrastructure  projects  9%. 
Moreover, during the last three years the EIB has progressed with the implementation of the 
Special FEMIP Envelope, under which the EIB finances higher risk private sector operations 
in the Mediterranean countries. EIB lending activity in Mediterranean countries was usefully 
complemented by private equity investments, which averaged EUR 44 mn per year over the 
last  five  years.  Notwithstanding  this  progress,  more  should  be  done  to  support  local  private 
sector development, which is a key priority for Mediterranean countries, as well as to support 
flagship projects under the Union for the Mediterranean initiative. 

In May 2008 the Commission made a legislative proposal to modify Article 23 of the ENPI 
regulation5  which  if  adopted  would  allow  use  of  reflows  from  past  operations  under  the 
FEMIP allowing it to increase its support to the private sector in the Mediterranean countries. 
The proposal has been adopted by the European Parliament while the Council has delayed its 
examination. 

2.2.2.  Eastern Neighbourhood and Russia 

The first mandate for Russia6 and the second mandate for Russia, Ukraine and Moldova were 
partly signed by the EIB (85% of the available EUR 100 mn and 46% of the available EUR 
500 mn respectively). Under the subsequent and current mandate, only 11% of the available 
amount of EUR 3.7 bn was signed as at the end of 2009. Three new operations were signed 
during the 1st quarter 2010 bringing total utilisation to EUR 748 mn or 20% of the available 
amount.  In  terms  of  disbursements,  the  amount  signed  under  the  first  mandate  was  fully 
disbursed, while one third of the amount signed under the second mandate had been disbursed 
at the end of 2009. Under the current mandate, 29% of the amount signed had been disbursed 
at the end of 2009. 

The reasons for this slow uptake can be attributed to several factors, in particular the narrow 
sectoral  focus  of  the  mandates,  the  political  and  economic  environment  of  the  partner 
countries  which  have  been  severely  hit  by  the  crisis,  the  limited  investments  by  project 
promoters in the region in sectors targeted by the mandate7 and the time required to establish 
working  arrangements  for  co-financing  with  the  EBRD.  Several  investments  were  also 
delayed by the poor project preparation and limited implementation capacity of promoters in 
the region. In addition, several projects in the transport sector in Russia were put on hold due 
to EU-Russia disputes over road and freight charges and trans-Siberian over-flight rights. 

The  relatively  inflexible  nature  of  the  Memorandum  of  Understanding  (MoU)  governing 
cooperation  between  the  Commission,  the  EIB  and  the  EBRD  and  the  limited  EIB  staff 
resources  have  reduced  the  effectiveness  of  the  EIB  intervention  in  this  region.  The 

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Regulation  (EC)  No  1638/2006  of  the  European  Parliament  and  of  the  Council  of  24  October  2006 
laying down general provisions establishing a European Neighborhood and Partnership Instrument. 
Northern Dimension Environmental Partnership. 
According to the Decision, in the Eastern Neighbourhood and Russia the EIB should focus on transport, 
energy, telecommunications and environmental infrastructure. Only recently financing of SMEs became 
eligible in the Eastern Partner countries. 

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Commission, the EIB and the EBRD are currently revising the above MoU to enhance their 
cooperation. 

2.3. 

Asia and Latin America (ALA) 

The  Decision  expressly  requests  a  re-examination  of  the  objectives  of  the  ALA  mandate, 
which were broadened under the current mandate to include not only support to EU presence 
through Foreign Direct Investment (FDI) and transfer of technology and know-how, but also 
environmental  sustainability,  including  climate  change,  and  energy  security.  Moreover,  the 
EIB  was  requested  to  progressively  align  its  activity  with  the  EU  cooperation  strategy  and 
extend its financing to more countries, including less prosperous ones. 

In terms of volume, the EIB committed the full amount available under the previous mandate 
for ALA countries and has already committed more than 50% of the ceiling under the current 
one.  In  Latin  America,  most  of  the  loans  (93%)  under  the  current  mandate  were  in  the 
telecommunications and productive sectors to support EU presence. In parallel, a few loans in 
support of environmental sustainability, notably in the field of renewable energy, have been 
signed by the EIB (7%). In Asia, most of the loans were for renewable energy and mitigating 
measures  following  a  natural  disaster  (76%)  with  the  remainder  dedicated  to  FDI.  The  EIB 
has also concluded two major operations at its own risk: a EUR 500 mn framework loan to 
support  climate  change  related  projects  in  China  and  a  loan  for  hydropower  projects  in 
Panama.  The  shift  of  EIB  intervention  towards  higher  value-added  operations  in  support  of 
environmental sustainability is to be considered satisfactory for Asia but should be improved 
for  Latin  America.  Disbursement  rates  in  the  regions  are  the  highest  (80%  of  amounts 
committed  under  the  previous  mandate)  reflecting  also  the  relatively  high  share  of  private 
sector  projects  which  are  often  disbursed  quicker  than  for  instance  large  public  sector 
infrastructure projects. 

The evaluation found that the small size of the ALA mandate, as well as the very limited EIB 
operational  staff  and  lack  of  concessional  resources,  make  it  too  demanding  for  the  EIB  to 
reach the many objectives set in the ALA mandate. For example, it is difficult for the EIB to 
target  less  prosperous  countries,  in  particular  those  facing  strict  debt  concessionality 
requirements.  In  addition,  it  was  found  that  there  is  no  reason  to  maintain  the  objective  of 
support  to  EU  presence,  in  particular  support  to  FDI,  as  an  objective  in  itself,  given  the 
possibility  for  the  EIB  to  finance  this  type  of  activity  at  its  own  risk  and  given  the  limited 
value added of this type of activity compared to other priorities supported by the EIB under 
the  mandate,  such  as  support  to  climate  change  mitigation  and  adaptation  and  resource 
efficiency. 

2.4. 

South Africa 

In South Africa, the EIB fully signed the amount available under the previous mandate and 
has already committed 54% of the amount available under the current mandate. The focus of 
EIB activity has been public infrastructure projects (in affordable social housing and related 
urban  infrastructure)  and  global  loans  in  favour  of  SMEs.  The  lending  activity  has  been 
usefully complemented by the advisory role played by the EIB in risk capital funds set up by 
the Commission. 

EIB  operations  in  South  Africa  were  particularly  effective  in  the  public  sector,  with  its 
significant investment needs in the areas of economic and social infrastructure. Private sector 
operations  were  most  effective  when  carried  out  in  cooperation  with  local  financial 

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intermediaries.  The  EIB  could  also  contribute  to  regional  integration  by  exploiting  possible 
synergies with the activity under the Cotonou Agreement. 

3. 

VALUE ADDED OF EIB OPERATIONS AND EU GUARANTEE 

3.1. 

Financial value-added 

The EIB provides financial value-added mainly through offering large lending amounts with 
longer  maturities  and  grace  periods  at  attractive  conditions  which  are  not  available  in  the 
market. The additionality was found by the evaluation to be particularly high in public sector 
operations, notably for infrastructure investments. In the private sector, the longer maturities 
of  EIB  loans  make  them  additional  particularly  in  countries  with  less  developed  financial 
markets. The financial value added for shorter maturity loans in the private sector was found 
to  be  of  a  more  catalytic  nature,  in  the  respect  that  it  helps  to  attract  co-financiers.  The 
additionality of EIB guaranteed lending was rather limited for lending in support to EU FDI, 
where funding from commercial banks is more easily available under normal circumstances.  

The Community guarantee was the key instrument enabling the EIB to be involved in a wide 
range  of  countries  and  borrowers,  both  by  allowing  the  EIB  to  intervene  in  higher  risk 
countries  and  operations  and  by  making  financial  conditions  more  attractive  to  borrowers. 
Given  this  fact,  the  Commission  and  the  EIB  should  review  the  limits  set  in  the  guarantee 
agreement for sub-sovereign risk operations which were found to effectively restrict access to 
loans by smaller municipalities, particularly in some countries, such as South Africa. 

The EIB was requested under the Decision to increase its operations outside the EU without 
recourse  to  EU  guarantee.  For  Pre-Accession,  Mediterranean  and  Eastern  Neighbourhood 
countries  including  Russia,  the  EIB  has  established  substantial  cross-sectoral  own  risk 
facilities. In addition, a EUR 3 bn own risk Facility for Energy Sustainability and Security of 
Supply  was  also  established,  addressing  inter  alia  climate  change  related  issues.  However, 
EIB  own  risk  lending  is  limited  to  investment-grade  countries  and  to  investment-grade 
structures in sub-investment grade countries (e.g. Turkey), including EU FDI operations. Over 
the last 3 years, the EIB has increased its own risk external operations, although these have 
mainly focused on Pre-Accession countries (driven by high absorption capacity in Turkey and 
Croatia) and China. 

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Table  2  –  Evolution  of  EIB 
2009

lending  activity  by 

type  of  guarantee  over  2000-

8000

7000

6000

5000

4000

3000

)
s
n
o

i
l
l
i

m
R
U
E

(

s
e
r
u
t
a
n
g
s

i

i

g
n
d
n
e

l

I

B
E

2000

1000

0

EIB own-risk

EC Political Risk
Guarantee

EC
Comprehensive
Guarantee

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Year of signature of EIB loan

The evaluation found that investment needs in the regions covered by the EIB mandate are so 
significant that guaranteed lending, limited by an increasingly constrained EU budget, needs 
to be topped up by a significant amount of EIB own risk lending, particularly for investment 
grade  countries  and  operations.  By  reinforcing  EIB  own  risk-taking  capacity  in  external 
operations,  the  EIB  can  provide  clear  value-added  by  using  its  own  balance  sheet,  whilst 
focusing EIB operations under EU guarantee in countries and for operations that have more 
difficulties in obtaining finance from the capital markets. 

More value added could be also be obtained by taking advantage of the opportunity to provide 
guarantees  under  the  mandate  (the  mandate  has  included  this  possibility  since  2007  but  no 
guarantee operations have yet been signed by the EIB under the mandate), in line with what 
the EIB is already doing in ACP countries, in particular with a view to providing guarantees 
to  financial  intermediaries  to  alleviate  capital  constraints.  Moreover,  the  EIB  Evaluation 
Department concluded that the value-added of EIB operations would increase if the EIB were 
to  play  an  increased  role  in  financial  sector  development  as  well  as  in  local  currency 
financing. The latter, however, requires the presence of a local bill and bond market or a swap 
market. 

3.2. 

Non-financial value added 

Beyond  the  significant  financial  contribution  provided  to  borrowers,  the  EIB  contributes 
positively  through  its  appraisal  process,  which  is  based  on  compliance  with  EU  standards 
(notably environment and procurement) and the technical and economic expertise of the EIB 
project staff. The value added was higher when the EIB contributed to project preparation via 
technical  assistance  or  raised  project  standards  through  contractual  conditionality.  Some 
weaknesses  were  found  in  the  monitoring  phase,  notably  as  regards  the  follow  up  of 
contractual undertakings and the monitoring of operations through financial intermediaries. 

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The  evaluation  concluded  that  there  is  potential  for  more  value  added,  in  particular  by 
devoting more resources to technical assistance for project preparation and implementation, as 
well  as  to  closer  monitoring  of  projects.  In  addition,  following  the  entry  into  force  of  the 
Decision  in  July  2009,  the  EIB  is  requested  to  enhance  its  activity  in  support  of  the  EU's 
development  policy  objectives.  This  is  a  challenging  task  as  the  EIB  business  model  is  not 
geared  towards  resource  intensive  activities  like  development  finance.  This  would  require 
inter alia a reinforcement of the EIB capacity to appraise social and development aspects of 
projects,  including  human  rights  and  conflict-related  risks,  and  to  actively  promote  local 
consultation  with  local  presence.  Finally,  the  EIB  should  define  performance  indicators 
covering development policy objectives. 

4. 

COOPERATION WITH THE COMMISSION AND WITH IFIS/EBFIS 

4.1. 

Cooperation with the Commission 

The evaluation shows that while cooperation between the EIB and the Commission was very 
limited before 2000, it has gradually intensified over the period 2000-2009. This cooperation 
takes place at different levels, from policy dialogue to joint programmes and collaboration at 
field  level  including  through  the  involvement  of  EC  delegations.  The  terms  of  this 
cooperation are set out in a Memorandum of Understanding recently concluded between the 
two institutions. However, it is found that there are opportunities to improve cooperation by 
better  articulating  the  activities  of  the  two  institutions  and  by  ensuring  more  coherence  and 
greater integration in the programming and implementation phase.  

One example of cooperation between the Commission and the EIB has been FEMIP, which 
involves  a  closer  dialogue  in  the  framework  of  the  FEMIP  Steering  Committee  and 
Ministerial meetings as well as joint programmes for risk capital and technical assistance. The 
Commission has also recently established a number of financial mechanisms under the IPA, 
ENPI and DCI, for combining budgetary grants and loans from the EIB, the EBRD and other 
European multilateral and bilateral finance institutions. These mechanisms are proving to be a 
valuable means to increase aid effectiveness, promote cooperation and leverage resources to 
the benefit of partner countries, although there is scope to improve their consistency. 

Finally,  the  evaluation  found  that  more  systematic  upstream  dialogue  including  on  key 
strategic  documents  must  be  ensured.  The  EIB  should  be  more  closely  involved  by  the  EU 
institutions – the Commission and the newly formed European External Action Service - in 
policy definition and in the development of country and sector strategies, which in turn should 
feed into the strategies concerning EIB activity. At project level, the Article 19 consultation 
procedure, which is designed to ensure EIB project compliance with EU policies before EIB 
final approval, should be reinforced by the Bank providing more extensive information on the 
contribution of the operation to EU policy objectives. 

4.2. 

Cooperation with IFIs/EBFIs 

The  Decision  specifically  envisages  that  EIB  operations  be  increasingly  carried  out  in 
cooperation  with  International  Financial  Institutions  (IFIs)  or  European  Bilateral  Financial 
Institutions (EBFIs). A specific requirement was set for cooperation with the EBRD (and the 
Commission) in the Eastern Neighbourhood region, in Russia and in Central Asia. 

The evaluation shows that the amount of co-financing by the EIB and IFIs/EBFIs increased 
strongly in recent years to reach 60% of total EIB financing under mandate in 2009. During 

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the period under the review, the EIB has gradually established a series of MoUs (bilateral and 
multilateral)  with  the  main  IFIs/EBFIs  in  the  different  regions  of  operation.  Some  of  the 
MoUs  entered  into  force  during  the  current  mandate:  the  one  with  the  Commission  and  the 
EBRD  in  the  Eastern  Neighbourhood,  Russia  and  Central  Asia;  the  NIF  Framework 
Arrangement; and the mutual reliance agreement with KfW and AFD for the Mediterranean 
region  and  Africa.  These  MoUs  represent  strengthened  commitments  to  cooperation  of  an 
operational nature. Increased co-financing and collaboration have increased the possibility for 
coherent project and sector conditionality among IFIs, as requested by the Decision. 

As regards the type of operational cooperation, the evaluation found that a move away from 
parallel co-financing in favour of joint financing can, in certain cases, be both in the interest 
of borrowers and also improve the efficiency of the financing support provided by the IFIs. In 
this context, the EIB should continue to promote, as it is currently done also in the key EU 
financial mechanisms under IPA, ENPI and DCI, the concept of mutual reliance between the 
EIB and the other IFIs/EBFIs. This would reduce duplication of efforts for the co-financiers 
and  facilitate  the  development,  implementation  and  monitoring  of  projects  by  promoters  by 
reducing  their  administrative  burden.  These  arrangements  should  continue  promoting  EU 
good practices, such as those on environment and procurement, while taking into account and 
enhancing  the  use  of  local  systems  in  line  with  the  principles  and  objectives  of  the  Paris 
Declaration for aid effectiveness and of the Accra Agenda for Action. 

5. 

CONCLUSION 

The  EIB  external  mandate  underpinned  by  the  EU  guarantee  has  proven  to  be  an  effective 
means to serve EU external policies by financing relevant projects in partner countries. At the 
same time, a broadening and increasingly ambitious EU external agenda points to the need for 
increased policy coherence and an enhanced support of partner countries, for instance in their 
fight  against  climate  change  and  resource  efficiency,  which  has  become  an  overarching  EU 
priority. 

Policy coherence can be improved by ensuring a better alignment of the scope of the mandate 
with  the  comparative  advantages  and  existing  means  of  the  EIB  and  enhancing  policy 
guidance to ensure a strengthened role in support of EU policies.  

On implementation, the evaluation concludes that the EIB has carried out its operations in an 
efficient  manner,  but  effectiveness  could  be  improved  by  reinforcing  its  capacity  to  support 
promoters  throughout  the  life  of  a  project.  Increased  support  for  project  promoters  assumes 
greater relevance given the new emphasis put by the Parliament and Council on the need to 
foster  social  and  economic  development  impact.  The  achievement  of  this  objective  would 
require the EIB to reinforce the human resources available for its external activities and would 
require an increase in the availability of complementary grant funding. 

Drawing  upon  the  present  Communication  and  the  findings  of  the  SCWP  report  and  the 
external evaluation, the Commission is putting forward a legislative proposal, which aims at 
enhancing the compliance with EU policy objectives and increasing the value added of EIB 
external operations for the second half of the 2007-2013 period covered by the Decision. 

EN 

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   EN