Cyprus gets first EU pre-accession loan

THE EUROPEAN Investment Bank, the European Union’s long-term financing institution, is giving Cyprus a ECU 50 million (£29.23 million) loan, the first under an EU pre-accession facility.

A statement by the Luxembourg-based EIB said the loan would be extended to the state-owned Cyprus Development Bank to use in financing projects by small- and medium-sized businesses in the industrial, agro-industrial, tourism and service sectors.

“This is the first EIB loan in Cyprus under the pre-accession facility concluded in 1998, which foresees additional EIB financing in candidate countries in Central and Eastern Europe and Cyprus by 2000,” the statement said.

The EIB, it said, was mandated to increase lending by ECU 3.2 billion (£1.87 billion) under the pre-accession facility in the applicant countries. The lending, it added, would be targeted at helping the 11 candidates with projects and would facilitate their integration with the EU.

The latest loan from the EIB is the fifth to be made available to the Cyprus Development Bank, the island’s main development finance institution. Previous loans totalling ECU 77 million (£42 million) have been utilised, among other things, to finance projects in the services and tourism sectors.

Cyprus, which hopes to join the EU by January 2003, opened accession negotiations with the bloc last March. “Substantive” membership negotiations got under way on November 10.

It has received a total of ECU 226 (£132 million) in loans from the European Investment Bank over the past 19 years to support projects in water supply, waste water treatment, industry, energy and transport infrastructure.

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