- EIB loan will be used to finance the national contribution to EU-funded priority projects.
- This is the first tranche of a co-financing loan that will facilitate projects worth €5.2 billion to support competitiveness, innovation and export-oriented growth.
The European Investment Bank (EIB) and Estonian authorities have signed a €300 million financing agreement to support investment in the green and digital transitions. The loan is the first tranche of a larger financing agreement, and also includes the co-financing of projects to support a just transition to a low-carbon economy in Ida-Virumaa.
The structural programme loan (SPL) agreed is a dedicated product for the co-financing of projects backed by European Structural and Investment Funds. The total volume of investment planned is €5.2 billion, with around €3.4 billion to be financed by EU structural funds, and the rest to be provided as national co-financing, which also includes the EIB loan.
“The consequences of the pandemic and the energy crisis have only reinforced the need to accelerate the green and digital transitions,” said EIB Vice-President Thomas Östros. “That is why the EU bank is delighted to sign this important loan agreement with the Republic of Estonia and support the economic and social development of the country. The EIB loan allows Estonia to kick-start the implementation of EU grant-funded projects to boost a smarter, greener and more connected society.”
Minister of Finance of Estonia Mart Võrklaev appreciates the long-term cooperation with the EIB in co-financing EU-funded projects. “This financing agreement is of great importance as it facilitates the smooth implementation of EU structural funds in Estonia. I would also like to emphasise that the flexible terms of EIB loans help reduce the burden on the state budget in the long run and diversify Estonia’s debt obligations. Investments in digital and green reforms are of significant importance to our economy, which can be stimulated by making it greener and smarter,” he said.
This will be the third EIB structural programme loan with the Republic of Estonia. The EU bank and Estonia have had two similar agreements during previous financing periods, for €550 million and €720 million, respectively, and including a COVID-19 top-up of €120 million.
About the EIB
The EIB is the long-term lending institution of the European Union and is owned by the EU Member States. The EIB Group has adopted a Climate Bank Roadmap to deliver on its ambitious agenda to support €1 trillion of climate action and environmental sustainability investments in the decade to 2030 and to devote more than half of EIB finance to climate action and environmental sustainability by 2025. As part of the roadmap, all new EIB Group operations have been aligned with the goals and principles of the Paris Agreement since the start of 2021.
Total EIB financing in Estonia since 1994 has been €3.8 billion. In 2022, nearly €172 million of EIB Group financing was signed for Estonian projects, mainly to support public infrastructure, healthcare, small and medium-sized enterprises (SMEs) and innovation. To support sustainable transport, the EIB increased its loan to Estonian Railways, and also invested in dairy producer E-Piim and in biotech company Icosagen. The European Investment Fund (EIF) signed agreements with Trind Ventures Fund II and Specialist VC Primary and Secondary Fund II, among others.