Cyprus is EIB’s leading beneficiary

Cyprus remains the leading beneficiary of European Investment Bank (EIB) engagement in Europe relative to GDP, confirmed EIB president Werner Hoyer during his visit.

Following meetings with President Nicos Anastasiades and Finance Minister Constantinos Petrides, EIB president Werner Hoyer confirmed that projects in Cyprus absorbed EUR 303 mln during the previous year, with both the private and public sectors benefiting from EIB support.

Werner Hoyer was in Cyprus to discuss recent and future investments in the country and see how the EIB is helping Cypriot companies overcome business challenges related to the COVID-19 pandemic and improve road safety.

“This visit provides a timely opportunity to discuss the European Investment Bank’s positive impact in Cyprus after another successful year of broad engagement in 2021,” Hoyer said.

Cyprus remains the largest beneficiary of EIB support, per capita, of any country in Europe, with outstanding EIB exposure totalling EUR 2.7 bln, or 13% of national GDP.

The EIB Group funding of Cyprus reached EUR 303 mln last year, increasing by 24% compared to 2020.

“EIB Group financing has helped Cypriot SMEs create jobs and invest in research and development.

“Last year, the bank also provided significant support for transport investment in Cyprus,” the EIB president added.

The EIB’s support to Cyprus includes the largest ever European Investment Fund (EIF) engagement, which was designed to boost economic resilience during the coronavirus pandemic.

Finance Minister Constantinos Petrides welcomed the support offered by the EIB to Cyprus to cushion the blow from Ukraine and the ongoing effects of the pandemic.

“We had a fruitful discussion over Cyprus’ cooperation with the EIB, and I express our satisfaction towards EIB staff in helping Cyprus fight the economic consequences of the COVID-19 outbreak and enabling us to reduce the economic effects of the pandemic,” said Petrides.

Almost half of EIB’s exposure to Cyprus was approved after the 2013 financial crisis.

Regarding the conflict in Ukraine, Petrides discussed the EIB’s response to the war and the support it has provided to reduce its economic impact before expressing Cyprus’ appreciation for the assistance.

EIB investments in Cyprus during 2021 include EUR 170 mln in new targeted business financing to support investments by Cypriot companies during the pandemic.

This includes EUR 100 mln EIB backing for local SME and midcap companies under the second Cyprus Entrepreneurship Scheme following the successful roll-out of the first package.

New investment by Cypriot companies will benefit from EUR 70 mln of new European Investment Fund financing to be managed by Hellenic Bank and Eurobank Cyprus.

And a record EUR 112 mln backing for road safety and priority transport investment.

Last year, new financing agreed upon will speed up road safety cameras at accident blackspots across the country and enable road improvements in Nicosia, Limassol, Paphos, and Vasilikos.

“We also had the opportunity to discuss new and additional investments planned in key sectors of the economy, including new long-term financing to help SMEs and Midcaps overcome the recent economic challenges, urban infrastructure projects, innovation projects, and renewable energy,” said Petrides.

“I am pleased that an agreement was reached with the European Investment Fund regarding the Cyprus Equity Fund, the first equity fund in the country supported by public resources,” he added.

The EIB expects to confirm new private financing initiatives with Cypriot banking partners under the Cyprus Entrepreneurship Fund risk-sharing initiative in the coming months.

The EIB is also finalising backing for urban investment and renewable energy generation projects.

The EIB has provided more than EUR 5 bln for private and public investment in Cyprus since the start of operations in the country in 1981.