The European Investment Bank (EIB), the EU bank, has recently announced the launch of a new financing initiative that aims to unlock close to EUR 1.6 billion of investment in the agriculture and bioeconomy sector. The financing aims to support private companies operating throughout the value chains of production and processing of food, bio-based materials, and bioenergy.
According to a statement on April 2, 2020, the initiative will be guaranteed by the EU budget under the European Fund for Strategic Investments (EFSI), which forms the financial pillar of the “Investment Plan for Europe”.
The lending programme will enable direct lending for private sector investments ranging from EUR 15 million to EUR 200 million, with the EIB loan amount ranging from EUR 7.5 million to EUR 50 million.
Targeted investments will support environmental protection and natural resource efficiency, renewable energy, innovation, competitiveness, and energy efficiency. The programme will contribute to safeguard and create employment in rural areas and therefore promote rural development and territorial integration across the EU.
The coronavirus pandemic affects every single one of us and every single sector. In this dramatic context, I warmly welcome this second step in EIB’s strategy under the Investment Plan to finance measures deploying a support plan for the AGRI-food sector. I am strongly convinced that this will be a very important and useful instrument in helping the sector remain robust and resilient to overcome the crisis, said European Commissioner for Agriculture Janusz Wojciechowski.
Agriculture and bioeconomy programme continuation
The programme is a continuation of the first EUR 400 million agriculture and bioeconomy programme loan that was launched in 2018 and is nearly fully committed. According to the EIB, the first programme loan generated “significant interest” in the market with a number of projects originated with corporate and cooperative counterparties in several EU countries including France, Poland, Ireland, Italy and Latvia.
Since the coronavirus pandemic reached Europe the EIB has been fully mobilised with the European Commission to deploy a support plan for the hardest hit SMEs, including those in the agri-food sector. Nevertheless, the EIB’s long-term financing of the sector continues in parallel, with a focus on innovation, climate action, environmental sustainability and rural development. The first EUR 400 million of the agriculture programme loan has already supported 10 transformational investments for European agriculture that have also strengthened rural communities. With this second financing, we are providing an additional EUR 700 million to build on this success and meet market demand, said EIB Vice-President responsible for bioeconomy, Andrew McDowell.
