Regional Infrastructure

Statement by Dr. Axel Hoerhager, Project Coordinator, European Investment Bank, Luxembourg

Your Excellencies, Mr. Chairman, Ladies and Gentlemen,

After almost a decade of violent conflict in the Balkans, the focus has shifted to the maintenance of peace, and the creation of stability, prosperity and freedom in the region. To be effective, economic and social support should be provided in a coordinated manner at a regional level. Under the EU’s Stabilization and Association process, the European Investment Bank (EIB, along with other IFIs, is complementing the European Commission’s role by providing support to reconstruction and new development of the SEE region.

The Balkan region is showing signs of greater stability as regards the political environment. However, the situation remains potentially volatile. In some countries, the reform processes still have a long way to go.

The EIB’s lending activity started in the region during the 1990s, beginning with the first-time operations in Albania in 1994, followed by a restart of operations in the FYR of Macedonia in 1998, Bosnia and Herzegovina in 1999, Croatia in 2000, and FRY (Serbia and Montenegro) in late 2001. The EIB plays a valuable role in being able to commit long term financing at very competitive terms, as well as providing appropriate project preparation and implementation experience on the ground. The EIB’s primary focus has been on providing support to basic infrastructure reconstruction, considered a key component in the development of the region. This has been complemented by the EIB’s contribution to the financing of the private sector, including SMEs, by means of so-called global loans through local financial intermediaries, often in cooperation with foreign banks that have set up subsidiaries in SEE.

Working with the European Commission, the Stability Pact and the Infrastructure Steering Group, the EIB, the EBRD, and the World Bank have combined and complemented their individual resources and expertise extremely well. An especially close level of cooperation has been achieved with the EBRD. Between themselves, the EIB and the EBRD have provided about 2/3 of the co-financing for their common funded projects.

In future, the EIB will continue to cooperate with the other institutions in line with a coordinated regional strategy. The Bank will also gradually expand its operations in SEE beyond the physical infrastructure area into sectors that it is already strongly supporting within the EU, that is to say the environmental sector, the municipal sector, and health and human resource development. The Bank will also continue to capitalize on its strong expertise in private sector financing, where it remains one of the largest official sources of funding, and particularly as regards SME development.

Ladies and Gentlemen,

The European Investment Bank remains committed to playing a proactive role in the region in cooperation with the European Union and the Stability Pact. Allow me to mention that the EIB was one of the key catalysts in the financing of the Vidin Calafat Bridge project between Bulgaria and Romania, and we remain committed to see this project through to its fruition.

Europe as a whole remains committed to SEE, and the EIB is a part of this commitment. We remain confident that the countries of the region, who will play the primary role in ensuring a better future for people living here, will continue to find the strength and resources that are required on their part, so that our common goals are realized.

Thank you for your attention.