ANNOUNCEMENT 15 Mar 2018
In March 2018, the European Investment Bank (EIB) approved a programme dedicated to supporting investments carried out by companies' in the agricultural and bio-economic sector in the European Union. The programme will be guaranteed by the European Fund for Strategic Investment (EFSI).
NUMBER OF INTERVENTIONS
The European Investment Bank, Project summary, AGRICULTURE AND BIOECONOMY PROGRAM LOAN: http://www.eib.org/en/projects/pipelines/pipeline/20170628
EIB, Agriculture and Bioeconomy Programme Loan: http://www.eib.org/attachments/thematic/agriculture_and_bioeconomy_factsheet_en.pdf
On 15 March 2018, the European Investment Bank (EIB) approved the Agriculture and Bioeconomy Programme Loan dedicated to supporting investments carried out by companies' in the agricultural and bio-economic sector in the European Union. Through the programme, the EIB will grant loans between EUR 7.5 and EUR 50 million. The agricultural and bio-economic sectors include the following activities: "primary production sector (animal and crop production, forestry, fisheries and aquaculture)" as well as "the up/downstream manufacturing (such as forest, paper and pulp industries, bioenergy production, resource protection, food retail/wholesale etc)"
The total budget for the programme is approved for a total value of EUR 400 million (approx. USD 558 million). A number of loans have been signed with companies under this programme, see related state acts.
A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the investment support granted here is discriminatory.
The EIB's Agriculture and Bioeconomy Programme Loan approved on 15 March 2018 was guaranteed under the European Fund for Strategic Investment (EFSI). The loan has a total value of EUR 400 million (approx. USD 558 million) and will support companies in the agricultural and bio-economic sector.
The EFSI is a joint initiative by the EIB and the European Commission to promote investment in Europe. The EIB has designated EUR 7.5 billion of its capital for lending to European projects with a higher risk profile than usually taken on by the bank. To compensate for the increased lending risk, the European Commission has agreed to fully guarantee all lending under the EFSI up to a budget of EUR 26 billion. The loan described was issued under the EFSI and thus benefits from a full guarantee through the EU budget.
EFSI support does not fall under EU State Aid rules as it is meant as a tool to address "market failures or sub-optimal investment situations". However, the investment support does include favourable conditions in the form of public assumption of risk.
As described in the European Commission's Fact Sheet from 13 January 2015: "The type of risk-financing instruments will be designed so as to take uncertainty out ("first loss protection") of as such viable projects and therefore crowd-in private sector investments. Since the EFSI will take riskier tranches in investment projects, the private sector will be able to join under more favourable conditions." Furthermore, the EIB states that "The new initiative [i.e. the EFSI] will benefit from the EIB’s strong credit standing that enables funding at favourable conditions and across maturities".