EIB Group commits €654 million in new financing for Lithuania in 2023

Source: www.gulfoilandgas.com 2/1/2024, Location: Not categorized

The European Investment Bank Group increased support for Lithuanian businesses and the economy.
Strong focus on promoting climate action and environmental sustainability and supporting small and medium-sized companies.
According to the EIB Investment Survey 2023, uncertainty about the future and energy costs are seen as the biggest obstacles to investment.

The European Investment Bank Group (EIB Group) has announced a significant investment of €654 million in financing for projects in Lithuania in 2023. This represents a substantial increase from 2022, and EIB Group financing in the country over the past five years now totals almost €2.4 billion.

To support investments in the green and digital transitions and help Lithuania become a smarter, more sustainable, and more connected economy, the EIB has signed a financing agreement of €300 million to the Lithuanian authorities. This loan is the first part of a €1 billion commitment from the EIB to support investment in all regions of Lithuania and facilitate the just transition of three carbon-intensive areas that have been most affected by the shift towards a climate-neutral economy.

As part of its efforts to promote climate action and environmental sustainability, the EIB has also pledged financing for the Ma˛eikiai onshore wind farm. This wind farm will generate enough electricity to meet the needs of 90 000 households and help reduce Lithuania’s dependence on electricity imports. In addition, the EIB has signed a financing agreement with Klaipedos vanduo, a Lithuanian water company, to support the extension and rehabilitation of the local water supply.

Boosting small and medium-sized companies and mid-caps is a priority for the EIB Group. In addition to the EIB financing agreement with Luminor to improve access to finance for small to medium-sized companies and mid-caps in Lithuania, the European Investment Fund (EIF) has supported Lithuanian businesses with nearly €250 million of financing through deals with banks or financing institutions such as Noviti Finance, Finbee Verslui, SME Bank, and SME Finance. This InvestEU-backed support includes micro-businesses that face challenges with traditional lending and are under different financial pressures today.

EIB Vice-President Thomas Östros, responsible for the region, said: "We are proud to announce this significant investment for projects in Lithuania. This demonstrates our strong commitment to promoting climate action and environmental sustainability, and supporting the growth of small and medium-sized companies. We believe that these investments will not only contribute to Lithuania’s decarbonisation process and energy independence but also create a positive impact on the economy, job creation and the overall well-being of the country."

In 2023, the EIB Group’s financing in Lithuania accounted for 0.9% of the country’s gross domestic product (GDP), supporting investments worth nearly €2.3 billion. These investments have benefited over 1 000 small and medium-sized companies and mid-caps, helping sustain more than 15 500 jobs. This highlights the significant role played by the EIB in fostering Lithuania’s economic growth and development.

EIB Investment Survey for Lithuania
The EIB also released today its annual Investment Survey (EIBIS). According to the results for Lithuania, aggregate investment has been increasing since the pandemic, mainly driven by private-sector investment growth.

Firms in Lithuania are concerned about the investment outlook and face barriers to investment. They are pessimistic about the political and economic climate, with more firms expecting conditions in their sector to deteriorate. Uncertainty about the future and energy costs are seen as the biggest obstacles to investment.

Despite these challenges, Lithuanian firms are investing heavily to mitigate climate effects. In 2022, 70% of firms invested to reduce carbon emissions, higher than the EU average. Additionally, a larger percentage of firms plan to invest in the next three years. However, there is a higher perception of the transition to stricter climate standards as a risk rather than an opportunity. Please see the full survey here.

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