European Investment Bank lends EUR) 280 million to upgrade 14 regional Greek airports
The European Investment Bank (EIB) has signed two loan agreements worth EURO 280 million in total with Fraport Greece to help finance upgrades to 14 regional Greek airports. The transaction benefits from the support of the EU budget guarantee under the European Fund for Strategic Investments (EFSI), the central pillar of the Investment Plan for Europe.
The EIB loan of EUR 280.4 million will be used for the financing of immediate development works at the 14 airports, including the refurbishment and modernisation of terminals, and the improvement of safety and airfield infrastructure. The investments will support the development of the tourism industry, a key driver of the Greek economy.
EIB Vice-President Jonathan Taylor, responsible for operations in Greece, stated, “The European Investment Bank is pleased to be investing in this nationally and regionally important project. It will create jobs, and provide a major boost for tourism – a sector that has proved its importance, and resilience, during the crisis. The EU Bank will support further investments in Greece that promote growth and help create sustainable and high quality employment.”
Pierre Moscovici, Commissioner for Economic and Financial Affairs, Taxation and Customs, said, “Modern infrastructure will play a crucial role in supporting Greece’s economic recovery. This requires sustained investment to ensure that it achieves its full potential to create jobs and spur growth. This agreement, with the support of the Commission, succeeds in mobilising private investment to finance upgrades to growth-enabling infrastructure that will support, for example, tourism and mobility. This is a prime example of the type of investments the European Commission is committed to support, as they bring growth and development.”
Fraport Greece will pay EUR 1.2 billion to the Hellenic Republic Asset Development Fund for the two 40-year concessions of 14 regional Greek airports (7+7). Apart from EIB, a consortium of Alpha Bank, Black Sea Trade and Development Bank, European Bank for Reconstruction and Development and the International Finance Corporation will provide long-term financing for the project.
The 14 airports that are included in the concessions are: Aktion, Chania (Crete), Kavala, Kefalonia, Kerkyra (Corfu), Kos, Mitilini, Mykonos, Rhodes, Samos, Santorini, Skiathos, Thessaloniki – Greece’s second largest city – and Zakynthos. These airports served a total of about 25.2 million passengers in 2016.
The European Investment Bank (EIB) is the European Union’s bank. The EIB is the long-term lending institution of the EU and is the only bank owned by and representing the interests of the European Union Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. The EIB works closely with other EU institutions to implement EU policy.
As the largest multilateral borrower and lender by volume, the EIB provides finance and expertise for sound and sustainable investment projects which contribute to furthering EU policy objectives. More than 90% of EIB activity is focused on Europe but it also supports the EU’s external and development policies.
Since 2008 the European Investment Bank has provided more than EUR 13 billion in loans and guarantees to Greece, to ensure continued investment in crucial infrastructure including education, energy, waste and water and by companies across Greece.
The Investment Plan for Europe, the so-called Juncker Plan, is one of President Jean-Claude Juncker’s top priorities. It focuses on boosting European investments to create jobs and growth by making smarter use of new and existing financial resources, removing obstacles to investment and providing visibility and technical assistance to investment projects.
The European Fund for Strategic Investments (EFSI) is the central pillar of the Investment Plan. It provides a first loss guarantee, allowing the EIB to invest in more, often riskier, projects. The EFSI is already showing concrete results. The projects and agreements approved for financing under the EFSI so far are expected to mobilise around EUR 178 billion in total investments and support over 400,000 SMEs across all 28 Member States.
In September 2016, President Juncker proposed to extend the EFSI by increasing its firepower and duration as well as reinforcing its strengths.
Fraport AG is one of the leading companies in the international airport business active on four continents through investments and subsidiaries. With Frankfurt Airport, its home base, the company operates one of the world’s most important air transportation hubs. In total, Fraport employs around 21,000 people worldwide.
Fraport Greece is a joint venture of Fraport AG Frankfurt Airport Services Worldwide and Copelouzos Group.
Copelouzos Group is a leading Greek industrial conglomerate with a wide range of portfolio activities, with core sectors being energy, airports, and real estate.