The European Investment Bank (EIB) plays a major role in the EU’s cohesion policy. It supports cohesion by financing projects that support innovation, infrastructure, small and medium-sized businesses and environmental sustainability in regions that are less developed (with a GDP per inhabitant below 75 % of the EU average) or are in ‘transition’, or are facing challenges such as declining industries, low competitiveness or high unemployment.
The EIB also provides advisory and technical assistance to define, prepare and implement projects, or acts as a fund manager on behalf public authorities through financial instruments. Much of the EIB’s support for cohesion takes place in parallel or as a complement to EU funds.
The three examples below from Poland, Romania and Greece demonstrate the ways in which the EIB is improving living standards across the EU.
The digital transformation of rural Poland
The crystal-clear rivers and scenic towns of central and north-eastern Poland are popular travel destinations. But the deep woods, winding valleys and lakes that make these places so beautiful also hinder access to robust internet services.
This is a problem at a time when teleworking is increasingly important and other vital digital services require high connection speeds. A few Polish companies, including Nexera and Światłowód Inwestycje (S.I.), are working to improve connectivity in the region by laying new fibre networks that will bring fast digital connections to its residents for the first time.
By 2025, the two companies plan to connect over 3.1 million addresses (2.4 million for S.I. and 0.7 million for Nexera), including households, businesses and schools.
But building a fibre network is costly. It requires attaching each house to a physical strand of fibre. The EIB is backing both companies with two separate loans to boost the spread of technology that is important to Europe’s future in regions where it is risky to invest.
The EIB’s EUR 76 million financing for Nexera is backed by the European Fund for Strategic Investments, which acts as a guarantee from the EU budget. The EIB loan will help Nexera connect around 530 000 households and 1 400 schools by 2023.
The EIB also provided a loan of around EUR 130 million to S.I. to enable the company to reach its ambitious goals of connecting 2.4 million households and offering faster internet in Poland’s bigger big cities and small towns.
Both projects promise to bring real benefits to the region.
‘Fibre attracts people to commute and telecommute to rural areas,’ says Anders Bohlin, a senior sector specialist at the European Investment Bank. ‘It also allows citizens to access new job opportunities, job training, and start new enterprises targeting local communities in local areas. It will make rural areas more attractive and competitive.’
Safe and sustainable transport in Romania
Romania is the eighth-largest country in the EU, but its 900 km motorway network is one of the shortest and the average speed on its railways is just 15 km/h for freight trains and 40 km/h for passenger trains.
Romania manages to build little more than 45 km of new motorway per year and some trains run slower than they did 100 years ago because public authorities struggle to manage the complexity of planning and implementing large infrastructure projects.
With EUR 17 billion from the European Union budgeted for transport infrastructure by 2027, the challenge is to put the money to work.
This is where the EIB’s Project Advisory Support Service Agreement (PASSA) comes in. An EIB team of seven have been working since 2014 with the Romanian authorities on site in Bucharest at the Ministry of Investment and European Projects, helping them to prepare, evaluate and implement projects to the EU’s demanding standards.
One of the biggest projects the EIB team worked on in 2021 was the modernisation of a 144 km stretch of railway that runs from Athens all the way to Dresden, via Sofia, Budapest, Vienna, Prague and Nuremberg. Valued at over EUR 2 billion, the rail upgrade is the largest transport infrastructure project in Romania in 30 years. The upgrade is part-funded by the European Commission as well as the EIB.
The upgraded rail lines, which will allow a maximum speed of 160 km/h for passenger trains and 120 km/h for freight, will slash travel times, lower the risk of accidents, and cut CO2 emissions by an estimated 1.5 million tonnes over the track’s 30-year lifespan.
The PASSA team has also supported the Romanian authorities with the procurement of new trains, something that Romania hasn’t done in 20 years.
‘Perhaps the biggest added value that the EIB has brought to us is that they’ve been able to provide teams with different backgrounds who have experience with operators and transport authorities,’ says Stefan Roseanu, president of Romania’s Railway Reform Authority. ‘The feasibility study they helped us to prepare is now used as a reference example for the Ministry of Transport and the Ministry of European Funds to think about new, further investments in rolling stock.’
Nature-based climate adaptation in Athens
The urban fabric of Athens is made up of dense constructions that cover 80 % of the city’s surface. All that asphalt and concrete retains the heat during the extended heatwaves to which the city is increasingly exposed. These urban heat islands in the city centre can be more than 10°C warmer than the suburbs. But asphalt and concrete are not just a liability when the weather is hot. They also stop water seeping into the ground during rainstorms. The result: frequent local floods.
Athens has set out to solve these problems, which are exacerbated by the impacts of climate change. The city is carrying out four innovative climate adaptation projects with EUR 5 million financing from the Natural Capital Finance Facility, a programme run by the European Investment Bank in cooperation with the European Commission that focuses on nature conservation, biodiversity and adaptation to climate change through nature-based-solutions.
The municipality has put forward four projects across the city that will improve water management, control soil erosion, create new green corridors, lower temperatures, and improve air quality in densely built neighbourhoods.
The projects, which include historic areas such as Plato’s Academy, will also boost biodiversity by favouring local species. The goal of the projects is to create at least 25 % more green areas. After decades of intense urbanisation, Athens is pioneering the design of green infrastructure for the benefit of its inhabitants and the environment.
