EIB hands Latvia massive loan

RIGA 's Latvian Finance Minister Atis Slakteris has signed an agreement with European Investment Bank Vice-President Eva Srejber granting the country a 500 million euro loan.

The Latvian Finance Ministry said it planned to use the loan for co-funding of the EU fund projects during the 2007-13 planning period.

"At the time when the loan is taken, concern about future is present among the businesses. This loan is a good stimulus for the development of business as well," Slakteris said.

He said that it is intended to use the borrowed funds for the development of business, especially facilitating innovation. The borrowed funds could be used for personnel development and education, especially higher education, as well as financing transport, communications and energy effectively projects.

The minister said that the loan was given with the best possible conditions.

"We will receive the first part of the loan worth 150 million euros and when all the reviews of its use are submitted to the bank, we will be able to attract the next part of the loan, choosing the condition," the minister said.

Slakteris also admitted that if the state expands its plans, it would be able to borrow more funds in addition to this loan.

The borrowing plan of the government for 2008 also provided for borrowing on the international financial and capital market by issuing Eurobonds and domestic borrowing by issuing debt securities.