Tbilisi/Luxembourg, 11 May 2012
EIB supports upgrade of road infrastructure in Georgia with EUR 170 million
The European Investment Bank (EIB) is lending EUR 170 million to the Republic of Georgia to upgrade and rehabilitate the East-West highway, which is a priority transport infrastructure linking Georgia’s capital city, Tbilisi, and its Black Sea ports with Turkey and Azerbaijan.
This is the largest EIB loan ever granted to Georgia and the first supporting Georgia’s transport sector. The loan will finance the construction of 52 km of new motorway between Samtredia and Grigoleti at the most Western part of the East-West highway, as well as the rehabilitation of 16 km of existing roads leading South from Grigoleti.
EIB Vice-President Wilhelm Molterer stated: “The East-West highway is a key transport axis in Georgia, which is of great importance not only for Georgia and its neighbouring countries, but also for the EU as a strategic transit route for road transport between Europe and Central Asia. Better transport links are crucial to improving Georgia’s economic cooperation with neighbouring countries and its other trading partners, strengthening the competitiveness of the region and increasing transport safety and capacity with positive consequences for the quality of life of the country’s citizens”.
This is the seventh EIB loan to Georgia, bringing the EIB lending commitment in the country to EUR 360 million. To date, the EIB has provided funds for the development of Georgia’s energy and water infrastructure, including loans to support the construction of high-voltage power transmission lines, the rehabilitation of the Enguri and Vardnili cascade of hydropower plants and the repair and upgrading of municipal water facilities. The EIB has also provided in Georgia credit lines to partner financial institutions to support indirectly smaller projects usually implemented by small and medium-sized companies.
The EIB – the European Union’s bank – finances projects in Georgia on the basis of an EU Council and European Parliament mandate for the Eastern Partner Countries (Ukraine, Moldova, Georgia, Armenia, Azerbaijan) and Russia of EUR 3.8 billion for the period 2007-2013. The current mandate provides for the financing of projects that contribute to (1) local private sector development, in particular support for SMEs, (2) development of social and economic infrastructure, and (3) climate change mitigation and adaptation.
The EIB has also set up at its own risk the Eastern Partners Facility (EPF) for an amount of EUR 1.5 billion, with a ceiling of EUR 500 million for loans in Russia. This facility enables the EIB to provide loans to support investment grade projects that sectorwise go beyond the scope of the mandate and helps support EU investment in the region, notably by European corporates.
Dušan Ondrejička, email@example.com, tel.: +352-4379-83334