March 9 (SeeNews) - The European Investment Bank, Bulgaria's biggest international donor, will continue to actively support the country's corporate sector, with a focus on agriculture and defence industry projects, the bank's vice president Vazil Hudak told SeeNews on Friday.
"The EIB was not very active in the area of defence and cybersecurity, but now, with the development of the European defence union, there is a lot of pressure from EU member states on EIB to be more active and we promised that this year we will provide support of at least 2 billion euro ($2.46 billion) for defence-related projects," Hudak told SeeNews on the sidelines of a presentation of the lender's activities in Bulgaria.
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Those projects should be in dual-use type of technology or R&D support, Hudak added.
"This is also a very interesting area, I think, for Bulgaria and the projects that we are looking at, because you have companies which are very strong in cybersecurity and [ones operating] somewhere between civilian and defence sectors," he explained.
The bank of the European Union has provided a 55 million euro loan to French aviation systems manufacturer Latecoere for innovation and capacity expansion, with 6 million euro of the loan to be used to finance the construction of a new assembly plant in Plovdiv, Bulgaria’s second largest city. The first stage of the Bulgarian part of the project is expected to generate over 200 jobs.
Hudak also pointed to agriculture and tourism as sectors in which the bank is looking to finance corporate projects in Bulgaria, with a special focus in innovations and R&D support.
The EIB is directly financing projects which are above 40 million euro in total size, usually providing up to 50% of this financing.
The EIB Group, comprising the EIB and its subsidiary, the European Investment Fund (EIF), provided 300 million euro of investment in Bulgaria in 2017. This figure is equivalent to 0.59% of the country’s GDP, above the EU average of 0.46%.
EIB loans totalled 250 million euro, while 49 million euro was provided by the EIF to facilitate the investments of small businesses to support their growth and competitiveness.
Last year, the EIB provided a 31 million loan to Bulgaria’s leading sunflower oil producer and grain trader Oliva to finance the construction of a new sunflower oilseed production plant and storage and logistics facilities.
The bank also extended a 100 million euro loan to Biovet, a subsidiary of pharmaceutical company Huvepharma International, to finance a planned increase of production capacity and R&D activities in the area of animal health.
In 2017, the bank also concluded 40 million euro of intermediated lending with two EIB partner financing institutions, further improving the access of Bulgarian SMEs and municipalities to EIB financing. A 30 million euro loan was extended to Raiffeisen Leasing Bulgaria, as it is expected that more than 150 companies operating in Bulgaria in agriculture, manufacturing, transportation and storage will benefit from the loan. The EIB also lent 10 million euro to Procredit Bank to co-finance smaller projects implemented by SMEs and mid-cap companies in Bulgaria.
In the public sector, the EU bank signed a 56 million euro loan agreement to finance the construction of the first stage of Line 3 of Sofia Metro, including a 7.8 km-long twin-track metro line, eight metro stations, a train depot and the supply of 20 metro trains and a control system.
Over the past 25 years, the EIB supported 79 projects and the EIF implemented 56 operations in Bulgaria. The total cumulative EIB lending commitment amounts to 5.1 billion euro since the launch of the bank’s operations in the country in 1992.
($=0.8131 euro)