Terence Brown, director of the EIB's Directorate for Lending Operations in Europe, said Latvia only received 5 million euros ($4.85 million) of the 2.66 billion euros the EIB issued in loans to companies in Central and Eastern Europe last year. But in the last three weeks Latvian companies have received 90 million euros.
The state-owned power utility Latvenergo signed an 80 million euro loan agreement and Pirma Banka, the reincarnation of the failed Latvian bank Komercbanka, received 10 million euros in credit for long-term lending to small- and medium-sized enterprises.
Although most projects in the Baltic countries financed by the EIB were also cofinanced or underwritten by the state, Brown said that private companies would be more likely to receive loans in the future.
EIB primarily issues loans for large-scale projects that promote economic development.
The easiest path to EIB funds for private companies has increasingly become loans from banks that receive EIB credit.
"We make loans available for your banks, and they themselves then decide to whom and for what goals they can be issued," said Brown.
According to Brown, issuing loans to Latvia's companies is no riskier than lending to Western companies.
While 10 to 12 years ago risk was high, Brown said Latvia and the other Baltic countries had advanced sufficiently to pose a "standard" credit risk.
The EIB began lending in Latvia in 1993. So far bank funds have helped rebuild the Ventspils port, modernize the infrastructure of the state-owned fixed-line telephone carrier Lattelekom and expand and modernize Riga's airport.
Please enter your username and password.
2024 © The Baltic Times /Cookies Policy
