European Investment Group to focus on investments in Africa this year

BRUSSELS, Feb 1, (KUNA): The European Investment Bank Group (EIB) Thursday announced that outside Europe, Africa will be the focus for its investments this year.

“We are practically active around the world. Africa is a special focus. There is no doubt about that. The expectation there is enormous. We can make much more of the euro by going there than sometimes to our own neighbourhood here,” EIB President Werner Hoyer told his annual news conference.

“We are a global institution. We are also very active in the Middle East. The Middle East together with Africa is our closest neighbour and we are well advised to be helpful there,” he said in reply to a question by the Kuwait News Agency (KUNA).

He noted that last year, the Group provided 12% of all financing, 8.8 billion euro ($9.7 billion) outside the EU for a wide range of projects including renewable energy, telecommunication infrastructure and other sectors.

Up to 43 of the countries where the EIB has active operations are defined as fragile states, those most in need for investment.

Over the last 10 years, EIB financing outside the EU totals 69.6 billion euro ($76.7 billion), of which 21.8 billion ($24 billion) has gone to Africa, said Hoyer.

“The EU bank has performed well in the markets, proving that there is strong demand for its products. It has also won support from the Member States in addressing and resolving the Brexit challenge,” he said.

The UK till today holds roughly 16 percent of the EIB capital which is around 240 billion euro, he noted.

“If the Brits (British) had withdrawn without their capital being replaced by others we would have had to reduce the maximum lending by about 100 billion euro ($110 billion) less. That would have been a disaster,” said the EIB chief.

“So I am extremely happy and grateful that after long discussions (EU) member states finally decided in April 2019 to replace proportionally the British callable capital,” he said.

“The cash contribution of the UK is far more than peanuts, a little over 3 billion euro ($3.3 billion) something that is to be repaid in tranches over ten years which we can afford,” he said.

“The key question is not the cash contribution of the UK but the callable capital and this is being replaced by others,” he said.

The financing provided by the EIB Group in 2019 supports total investment of around 280 billion euro ($308 billion) in Europe and worldwide, an increase of 50 billion euro ($55 billion) compared to 2018.

A record 31 percent share of this financing went into climate action projects, transforming Europe’s energy markets, but also mitigating the effects of climate change and helping people in greatly affected areas to adapt, he noted.

The EIB Group funds its activities on

the global capital market and benefits from an “AAA” rating. In the last year, it borrowed 50.3 billion euro ($55.4 billion)

from international investors.

The Luxembourg based EIB is a publicly owned international financial

institution and its shareholders are the EU member states who set the bank’s broad policy goals and oversee the two

independent decision-making bodies, the board of governors and the board of directors