The European Investment Bank (EIB) instruments for the Mediterranean partner countries and Turkey
Khaled Elnimr, Senior Policy Officer, EIB Reggio Calabria, 29 January 2015
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1. The European Investment Bank: an overview 2. Financial instruments, eligibility criteria and project cycle 3. Activities in the Mediterranean 4. Activities in Turkey 5. Unlocking the Potential
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EIB at a glance European Union’s long-term lending bank set up in 1958 by the Treaty of Rome. The EIB contributes to the realization of investment projects that further the economic, social and political cooperation priorities of the EU. Shareholders:
28 EU Member States
Subscribed capital (July 2013)
€243.2 bn
Total lending to 2014:
€77 bn of which: - €69 bn European Union - €7.9 bn outside the EU
Rating: 02/02/2015
AAA European Investment Bank
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EIB at a glance • Largest multilateral lender and borrower in the world – Raise our funds on the international capital markets – Pass on favourable borrowing conditions to clients
• Some 440 projects each year in over 160 countries • Headquartered in Luxembourg and 28 local offices • Around 2 100 staff: – Not only finance professionals, but also engineers, sector economists and socio-environmental experts – More than 50 years of experience in financing projects 02/02/2015
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EIB capital breakdown
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1. The European Investment Bank: an overview 2. Financial instruments, eligibility criteria and project cycle 3. Activities in the Mediterranean 4. Activities in Turkey 5. Unlocking the Potential
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Our products • We help catalyse investment
LENDING Loans But also:
BLENDING Combining EIB finance with EU budget
Sector-focused initiatives: Transport Energy Water Urban SMEs
Guarantees Private equity Microfinance
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ADVISING
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EIB lending project cycle
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Sustainable & bankable projects •financially viable, acceptable economic return, appropriate credit risk •technically sound, compliant with environment protection, procurement regulations and prevailing social legislation and norms What are the terms and conditions? •generally operates on close to market related terms •Long maturities & grace period (usually not available locally except from other IFIs/DFIs), different interest options/ currencies •Lending/equity investment often combined with TA or similar support (grant funded), subsidies depend on Mandate/Blending EIB value added? •REM measures added-value of projects from an economical, environmental, social and governance perspective •Acts as a catalyst in mobilising local / foreign lending, e.g. MRI •Complementarities with operations/ instruments of EU, bilateral or multilateral institutions 02/02/2015
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1. The European Investment Bank: an overview 2. Financial instruments, eligibility criteria and project cycle 3. Activities in the Mediterranean 4. Activities in Turkey 5. Unlocking the Potential
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Lending totals 2013
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Priority sectors in the Mediterranean Develop economic and social infrastructure support substantial investment needed across sectors
Promote MSMEs and local private sector development ensure availability of finance throughout the MSME lifecycle
Build capacities in the region share know-how to develop, implement and monitor projects
And in all these activities, a cross-sectoral approach on three key themes: Job creation Climate change mitigation and adaptation Regional integration 02/02/2015
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Available resources
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FEMIP lending EUR m
n n n n n n n n n
Energy Transport Telecommunications Industry Environment Human capital Credit lines Private equity
Israel 932m
Urban Development
Syria 1,059m
Tunisia 3,757m Morocco 4,177m Gaza/West Bank Lebanon 841m 61m
Algeria 636m
Egypt 3,918m Regional 234m Amount signed from October 2002 to date: EUR 16.1bn 02/02/2015
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Jordan 466m 14
Project Example
Ouarzazate solar power plant Solar power plant in Morocco with an initial capacity of 125-160 MW to reduce dependence on energy imports and avoid the generation of at least 250 000 tons of CO². 02/02/2015
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Part of the Moroccan Solar Plan. If fully developed (2GW target capacity), the largest solar power plant in North Africa.
Ouarzazate solar power plant
Project promoter is the Moroccan Agency for Solar Energy (MASEN). Independent power producer (IPP) to implement the project was selected by MASEN through competitive bidding. The NIF direct investment grant to bring down the cost of electricity during the initial stage of the project. Total project volume: approximately EUR 807 million Grant contribution: EUR 30 million
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1. The European Investment Bank: an overview 2. Financial instruments, eligibility criteria and project cycle 3. Activities in the Mediterranean 4. Activities in Turkey 5. Unlocking the Potential
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EIB lending to Turkey EIB has been lending to Turkey since the mid 1960s; with an overall lending volume of some EUR 15bn over 2006-2012 Step change in lending activity since 2005, given the status of Turkey as Candidate Country for EU Accession Turkey ranks first among EIB recipient countries outside EU EIB’s role is to support the country’s economic development and assist the country in its pre-accession phase to the EU The Bank reacts swiftly, adapts its lending priorities to the changing needs in the country and EU 02/02/2015 02/02/2015
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EIB lending to Turkey Three Pillars Public sector support: National flagship transport projects (Istanbul Ankara High Speed Line, Marmaray tunnel, Eurasia Tunnel) Local infrastructure (water, waste water, light rail, earthquake risk mitigation) Human capital, Knowledge Economy (R&D through TŰBITAK and YÖK) Climate Change (Energy Efficiency, Afforestation and Erosion Control)
Corporate sector: Energy (including renewables, Combined Heat & Power) R&D Foreign Direct Investments (including telecom, energy) Co-operation with public and private banking sector focusing on: SMEs Energy Efficiency & Renewable Energy Environment Municipal infrastructure EIB can only reach small / medium sized projects through its extensive co-operation with local banking partners 02/02/2015
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1. The European Investment Bank: an overview 2. Financial instruments, eligibility criteria and project cycle 3. Activities in the Mediterranean 4. Activities in Turkey 5. Unlocking the Potential
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Unlocking opportunities Large Markets •
• •
•
•
That needs
Large Investments
To harness the
Untapped potential
Renewable energy: energy Highest world rates of sunlight duration of more than 3,500 hours per year; progressive awareness by governments on potential. Study carried out by the EIB shows that pipeline of RE project in the MENA amounts to 10.3 GW for 90 projects. Transport sector: sector key transport interconnections still missing. EIB working on the development of key logistics platform in the region with connection to the hinterland. Health, education and urban development: development large demand for projects in the social sectors. EIB financing social housing and considers opportunities for PPPs to bring in the private sector. Heritage and tourism: Economic performance of tourism in MENA region has been surprising, given the security risks, natural disasters, oil price rises and economic uncertainties in the region. Potential for growth is evident. EIB is deploying Medinas 2030 initiative for sustainable and integrated rehabilitation of historic city centers. Niche markets: opportunities in mobile banking sector, sector agri-business, health and pharmaceutical sectors, sectors media and IT sectors, sectors broadband connections etc…
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Thank you! More information at: www.eib.org
[email protected] Tel. : +352 4379-22000 02/02/2015
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