The EIB in the Czech Republic in 2017

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1 The EIB in the Czech Republic in 2017 In the Czech Republic, as in the other EU Member States, the EIB supports investment projects designed to reduce disparities in regional development, strengthen economic competitiveness and improve people s living standards. In 2017, EIB lending in the Czech Republic totalled EUR 977m, bringing EIB lending for projects promoting European objectives in the Czech Republic to EUR 4.1bn over the past five years ( ). Financing projects contributing to economic progress in EU-assisted areas remains the key activity of the EIB. The territory of the Czech Republic consists mostly of regions fully qualifying for EIB loans as well as for allocations from the European Union s Structural and Cohesion Funds. Support for innovative industries In 2017 the EIB provided EUR 36m to finance automotive producer Benteler s International research, development and innovation (RDI) and technology deployment activities towards the development of optimised lightweight and safer chassis components - made of a wide variety of metal and non-metal materials and combinations and engine parts with extensive downsizing potential. This is a part of a project supporting RDI activities also in Austria, Germany and Hungary. January 2018 page 1 / 6

2 Loans for SMEs and midcaps The EIB concluded eleven intermediated loan contracts amounting to EUR 925m with Czech financing institutions in These institutions use the EIB funds to finance projects carried out by SMEs and municipalities in the fields of local infrastructure, environmental protection, energy, R&D and innovation, and services, including tourism. EIB loans have thus improved the access of SMEs to medium and long-term funds on advantageous financial terms. The estimated aggregate number of SME and MidCaps projects to be financed from EIB loans in the Czech Republic in 2017 is around 15,000. EUR 477m was allocated by intermediary banks to final beneficiaries to support 1960 projects implemented by SMEs, MidCaps and public sector entities last year in the Czech Republic, out of which 93% was allocated to Convergence regions. More than 56% of the allocated amount related to projects in the Manufacturing industry, 18% in Transportation and Storage, 11% in Whole sale and retail and 7% in Agriculture. EIB also supported youth employment through key partners such as Komercni Banka, Skills and Jobs - Investing for Youth focused on the implementation of EIB s key priority, to support Europe s fight against the unemployment of young people. The position of young people on the labour market is relatively difficult. They have a minimum working experience and their unemployment is high. Therefore, the EIB, in cooperation with Komerční banka, focuses on Young employment support. The aim is to support both: link theoretical education of Youths with practical skills in the form of training and practice, and direct employment of young people. This year, 30% of the total allocation was dedicated to this Initiative. Project examples of undertakings co-financed by EU Bank in this framework were investments related to freight transport, manufacture of agricultural and forestry machinery, reconstruction of hospitals and schools, rehabilitation of kindergarten and reconstruction of public lighting. January 2018 page 2 / 6

3 Project example: Investment Plan for Europe: landmark EUR 100 million risk-sharing deal to support small and medium-sized businesses in the Czech Republic The EIB in cooperation with Česká spořitelna, a.s. developed the first risk-sharing operation in the Czech Republic and the whole Central Europe region guaranteed by the European Fund for Strategic Investments (EFSI) in order to provide EUR 100 million in funding to small and medium-sized businesses for climate action and research-related projects. This loan-by-loan guarantee of EUR 50 million from the EIB will provide 50% credit risk protection on a portfolio of new loans extended by CSAS. The aim of the transaction is to catalyse and/or accelerate new investment primarily in the areas of energy efficiency, small renewable energy sources and innovation. Project example: Investment Plan for Europe: EUR 50m for CEZ s Inven Capital to support growth of innovative smart energy and clean-tech companies The EIB support to the Czech Republic Inven Capital Fund helps to develop a coinvestment initiative to foster the growth of clean energy and smart technology SMEs and MidCaps in the EU. Czech energy utility CEZ has supported this initiative with the same amount so that the total financing available for joint co-investments to clean-tech and smart energy businesses will amount to EUR 100m. This transaction has been guaranteed by the European Fund for Strategic Investments (EFSI), which is the central pillar of the Investment Plan for Europe. Project example: EIB teams up with KB to battle youth unemployment, climate change Last year the EIB again joined forces with Komerční Banka in an effort to provide a significant contribution to SMEs and midcaps the drivers of the economy. This time, most of EIB funds help increase the employment rate of young people, who frequently face a difficult perspective on the labor market. Some 85% of the EUR 100m loan is to be allocated under the Jobs for Youth initiative to SMEs and mid-caps employing people below 30, offering vocational training or cooperating with educational establishments. The rest will go towards financing energy efficiency and renewable energy investments associated with building rehabilitation undertaken by SMEs and mid-caps. January 2018 page 3 / 6

4 Project examples Renovation of secondary school in the Pardubice Region Upgrade of local road network in Eastern Bohemia January 2018 page 4 / 6

5 The European Investment Fund The European Investment Fund (EIF) is the specialist arm of the EIB, providing risk financing solutions to financial intermediaries to support SMEs and midcaps and foster innovation in Europe. In 2017 it committed EUR 9.34bn in support of business, through which approximately EUR 35.4bn of additional capital will be leveraged. By business line, the EIF committed a total of EUR 3.3bn for equity in 146 equity transactions with early and growth stage funds, which are expected to raise EUR 15.7bn of additional commitments. On the guarantees side, it committed EUR 5.9bn in 169 transactions, which acted as a catalyst in generating EUR 18.9bn of new loans for SMEs. EIF s support for micro- and social enterprises totalled EUR 110m, creating a total loan volume of more than EUR 685m. Overall, more than SMEs and midcaps were supported by EIF in 2017, sustaining some 1.5 million jobs. In the Czech Republic in 2017, the EIF committed EUR 184.5m in one equity, four guarantee and one microfinance operation, aimed at raising EUR 443.1m. The potential Investment triggered by the EIB Group in the Czech Republic thanks to EFSI transactions totalled EUR 2.52bn in In this regard, the EIF signed five EFSI transactions with an aggregate EIF contribution of EUR 184.5m. For more information: The EIB at a glance The EIB is the EU s long-term lending institution and is owned by the EU Member States. It makes long-term finance available for sound investment, contributing to growth, jobs, regional convergence and climate action in Europe and beyond. To maximise growth and job creation, the EIB targets four priority areas: innovation and skills, SMEs, climate action and strategic infrastructure across the EU. By the end of 2017, in the framework of the European Fund for Strategic Investments (EFSI), the EIB Group had approved over 717 Investment Plan operations with financing totalling EUR 37.6bn EUR 27.4bn from the EIB and EUR 10.2bn from the EIF. The total value of the projects and the investment mobilised comes to EUR 257bn. This is 82% of the overall target of EUR 315bn over three years. January 2018 page 5 / 6

6 Overall EIB Group achievements in 2017 A total of EUR 78.2bn in financing by the EIB Group. EUR 13.8bn EIB Group support for innovation and skills, including education and digital infrastructure. EUR 18bn supporting key infrastructure in transport and energy as well as urban infrastructure. By end-2017, the EIB Group had approved EUR 51.3bn under EFSI for more than 717 financing transactions, which are expected to mobilise investment of EUR 257bn. EUR 29.7bn EIB Group support for SMEs and midcaps the biggest ever volume. EUR 16.7bn for environmental projects supporting resource efficiency and sustainability. For further information on the EIB in the Czech Republic: Press contacts: Dušan Ondrejička Tel: d.ondrejicka@eib.org Press Secretariat Tel: Fax: press@eib.org General contacts: European Investment Bank boulevard Konrad Adenauer L-2950 Luxembourg Information Desk Tel: Fax: info@eib.org January 2018 page 6 / 6