The EIB advised Warsaw’s government on a planned expansion of its Metro system to get the EU grants it needed. Then the Bank loaned much of the rest of the cost.
The Warsaw project hits two of the three pillars of the Urban Agenda for the EU. Here's how.
The first time European Investment Bank bankers came to discuss Warsaw’s extension to its small Metro system, they didn’t ask the questions Michal Olszewski expected. “A commercial banker would’ve said, ‘Will you be able to pay me back?’ The EIB wanted to know why we needed a Metro.”
The deputy mayor of Warsaw, Olszewski was impressed that the EIB wanted to be sure the city was taking the right decision financially—and in relation to EU policy goals.
“The EIB is not just there to finance a project, but also to help solve the strategic challenges,” he says. “Once they approve your project, you have a real proof of concept.”
The Urban Agenda for the EU, which is unveiled 30 May in Amsterdam, has three main pillars:
- Better regulation
- Better funding
- Better knowledge-sharing
The Warsaw Metro project demonstrates how the EIB works on the funding and knowledge-sharing pillars.
Proof of an Urban Agenda pillar
The EIB’s testing of Warsaw’s concept began long before it made its EUR 111 million loan to buy new rolling stock for the Metro in 2012, and EUR 115 million to build the central section of the Metro’s second line and seven new stations in 2013. Collaboration started when the City requested support from the JASPERS programme to advise how best to structure its project so that it could justify significant EU grant funding.
JASPERS stands for Joint Assistance to Support Projects in European Regions. Co-sponsored by the European Commission and the EIB, JASPERS provides a range of advisory services on transport, as well as on investments in environmental projects, RDI, information and communications technology, health, education and urban development. The services range from reviewing the project and recommending changes to support during implementation. In Warsaw the advice included justification of project feasibility and assessment of environmental impact.
That helped Warsaw receive EUR 945 million from the European Commission, out of a total EUR 1.5 billion cost.
Warsaw is now working with the Bank on a EUR 200 million loan as part of its almost EUR 1.9 billion plan to build 11 more stations and a depot, and to buy 49 new units of rolling stock. “It’s fantastic,” says Olszewski. “You really feel like you’re part of something great for your city.”
