EIB Group support for projects in the Czech Republic amounts to EUR 708m in 2018

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EIB National Press Conference 2019 in Prague

EIB National Press Conference 2019 in Prague

EIB Group support for projects in the Czech Republic amounts to EUR 708m in 2018

01/02/2019

EIB

[Czech Republic, Prague]

  • EIB lending reached EUR 443m and EIF equity and guarantee commitments EUR 264m
  • EIB loan disbursements in 2018 amounted to EUR 691m, resulting in a record disbursement level over the past three years
  • In total, some 6,900 small businesses benefited from EIB Group operations, supporting 176,000 jobs in the Czech Republic in 2018

The European Investment Bank Group (EIB Group),  comprising the European Investment Bank (EIB) and its subsidiary, the European Investment Fund (EIF), provided EUR 708m in loans, guarantees and equity in the Czech Republic in 2018.

The EIB signed new loan contracts for EUR 443m, while the EIF committed EUR 264m in 14 equity, guarantee and microfinance operations for some 4,300 small businesses, supporting approx. 48,000 jobs and mobilising total investments of EUR 925m.

EIB loan disbursements, representing the provision of funds to finance projects, including those signed previously, i.e. support for the real economy, amounted to EUR 691m, resulting in a disbursement record for the country over the last three years.

Part of the EIB Group’s financing was made possible by the Investment Plan for Europe, or “Juncker Plan”, as it is commonly known. Under this plan, launched in 2015, the EIB provides loans guaranteed by the European Fund for Strategic Investments (EFSI) and also advice via the European Investment Advisory Hub (EIAH). By end-2018, the EIB Group had approved projects totalling EUR 694m, backed by EFSI guarantees, triggering potential investments of EUR 4bn.

EIB Vice-President Vazil Hudák commented: “The EIB made a valuable contribution to the country’s growth in 2018. In particular, the level of our disbursements – money reaching the real economy – was very strong last year, sustaining a substantial number of jobs. Also, we managed to re-engage with the Government after nearly a decade, initiating a number of loans, some of which we hope will come to fruition this year.”

Loans for SMEs and midcaps

The EIB concluded six intermediated loans worth EUR 395m with Czech financial institutions in 2018. These institutions onlent the EIB funds to SMEs and municipalities for projects in the fields of local infrastructure, environmental protection, energy, R&D and innovation, and services, including tourism. About 2,600 SMEs and mid-caps benefited from EIB lending and 128,000 jobs were supported last year in the Czech Republic.

Modernisation of the Czech Republic’s regions and cities

In 2018, the EIB provided CZK 700m (some EUR 27.4m) to the South Moravian Region to improve infrastructure, help the economy and offer better public services, especially in the health and social care sector. This includes the refurbishment of public buildings, schools and sport facilities, and social care buildings, and measures to cut energy costs. Together with EU funds amounting to CZK 1.5bn (EUR 59m), the EIB loan is being used to co-finance 15 transport, health and social care sub-projects. This is the third EIB operation granted in the South Moravian Region, bringing EIB support to the area to some EUR 116m.

Support for innovative industries under the guarantee of the European Fund for Strategic Investments

As in previous years, the EIB provided support to local branches of leading innovative companies to foster research and development, and to introduce innovative production technologies. In this context, the EU bank provided the following loans in the Czech Republic:

  • EUR 7.5m of a total loan of EUR 30m to CARMAT, the developer of the world’s most advanced artificial heart. The company’s products provide an alternative for people suffering from end-stage biventricular heart failure.
  • EUR 13.4m of a total loan of EUR 80 million to finance the development of an innovative and sustainable European car industry. The loan will help CIE Automotive develop technologies that reduce the weight of vehicles and ensure more efficient, less polluting manufacturing processes.

These transactions are backed by the European Fund for Strategic Investments (EFSI), the financial pillar of the Investment Plan for Europe, or “Juncker Plan”.

EIB Advisory Services

The Advisory Services in the Czech Republic are delivered mainly through JASPERS, the European Investment Advisory Hub (EIAH), the Financial Instruments Advisory (FIA), the InnovFin Advisory (IFA) and the European PPP Expertise Centre (EPEC).

In 2018, JASPERS (Joint Assistance to Support Projects in European Regions) focused on transport in the Czech Republic. Nine of the eleven assignments that it completed supported major rail and road projects. It also successfully assisted the update of the Cost Benefit Analysis Methodology for transport projects in the Czech Republic, which should speed up the preparation of transport projects to be supported by European Structural Funds. JASPERS is now working on 18 assignments, 89% of which are in the transport sector. Its work currently covers the second phase of the following major projects: R35-Dostavba MUK Opatovice-Ostrov and D1-Prerov-Lipnik (0137) motorway.

As a partnership programme between the EIB and the European Commission, the European Investment Advisory Hub, offers a single point of entry to a comprehensive offer of advisory and technical assistance, providing targeted support for the identification, preparation and development of investment projects across the European Union. As of December 2018, it had received 26 advisory requests from the Czech Republic, ranging from information inquiries to requests for technical assistance and funding. Of these, 22 requests were project-specific, and 14 came from private sector.

The Czech Republic participates in EPEC’s networking activities and is a member of EPEC through the Ministry of Finance. EPEC supported the Ministry of Transport and the State Fund for Transport Infrastructure (SFDI) in the development of the PPP decision and PPP case for the D4 expressway project.