EIB to support investments in green, digital transitions in Estonia with EUR 300 mln

TALLINN – The European Investment Bank (EIB) and Estonian authorities have signed a 300 million euro 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 East-Viru County, spokespeople for the Ministry of Finance said.

The structural program 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 euros, with around 3.4 billion euros 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," EIB Vice President Thomas Ostros said. "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 kickstart the implementation of EU grant-funded projects to boost a smarter, greener and more connected society."

Minister of Finance of Estonia Mart Vorklaev said he 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 emphasize 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 program loan with the Republic of Estonia. The EU bank and Estonia have had two similar agreements during previous financing periods, for 550 million euros and 720 million euros, respectively, and including a COVID-19 top-up of 120 million euros.