Lithuania attracts largest amount of EIB loans in Baltic region

Lithuania was the largest European Investment Bank's (EIB) beneficiary among the Baltic States last year, Jan Vapaavuori, the bank's vice president said in Vilnius on Friday.

"If we look at our activities in the Baltic region last year, Lithuania has been the biggest client here so far," Vapaavuori told reporters during a press conference held at Lithuania's Ministry of Finance.

According to him, a big difference between three Baltic States, Lithuania, Latvia and Estonia, could be seen. Last year, Lithuania received 474 million euros of EIB loans, while Latvia and Estonia -- 210 million euros and 32 million euros respectively.

"We are a strong player in Lithuania; the total exposure, as we are used to measure in percentage of GDP, amounts to 5.6 percent in Lithuania, while European average is 3.5 percent," Vapaavuori commented.

In May last year, Lithuanian government and EIB signed an agreement on 300 million euro tranche of 1.3 billion euro loan facility which is being used to co-finance projects implemented together with the EU structural funds.

According to Rimantas Sadzius, Lithuania's minister of finance, "long lasting and sincere partnership" with EIB allows Lithuania to implement big projects in the sector of energy such as liquefied natural gas (LNG) terminal in port city Klaipeda, as well as to continue residential house renovation program.

"This year, we will pay more attention to create conditions which would allow us to attract funding from European Fund for Strategic Investments (EFSI) and private funds," Sadzius noted.

EFSI is a fund created by the European Commission (EC) for mobilizing new investment under so called Juncker plan.

"It is a big challenge over the next three years; it is just a beginning, however, we have already been able to mobilize 50 billion euro so far," Vapaavuori emphasized.

The EC target for three years is total amount of 350 billion euros. Half of the projects approved by now under the EFSI cover renewables, energy efficiency, low-carbon and environment, EIB vice president explained.

There are no EFSI projects in Lithuania which had reached contract signature phase yet, nevertheless, "a few quite promising" projects are currently in an appraisal state, Vapaavuori said. However, he did not elaborate, referring to confidentiality of the negotiations.

During a separate event on Friday, the company Lithuanian Railways (Lietuvos Gelezinkeliai) announced that it was borrowing 68 million euros from the EIB. The deal was signed on Friday afternoon by Albertas Simenas, deputy director general of Lithuanian Railways, and EIB Vice President Vapaavouri.

"Modernisation of railway infrastructure is one of our top priorities; cooperation with the EIB allows implementing projects that are essential both to Lithuania and entire Europe," Simenas said.

The Lithuanian state company and the EIB have been cooperating since 1996 with total loan amounting to over 244 million euros. The bank's funds were used to update rolling stock traction units and modernise railway infrastructure.

The EIB is the long-term lending institution of the European Union owned by its Member States. EIB's total financing last year amounted to 84.5 billion euros.

The EIB priorities in the Baltic region are the EU projects co-financing facilities, contribution to sustainable infrastructure, such as energy and transport, and funding of SME's through intermediary financial institutions.