MADRIDThe metro and the Port of Barcelona or some climate action policies of the Catalan capital’s City Council. These are just a few examples where the European Investment Bank (EIB) has come into play as the financial arm of the European Union. This body, until now unknown to the majority of citizens, has grabbed all the attention after the acting First Vice-President and Minister of Economic Affairs, Nadia Calviño, formally applied to preside over it on Friday.
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The truth is that although the EIB plays a key role in terms of financing, when talking about a European bank the first thing that comes to mind are the acronyms of the European Central Bank, the ECB, chaired by Christine Lagarde, and that for just over a year it has also been in the headlines for the tightening of monetary policy with the rise in interest rates. “We couldn’t pass up the opportunity [de la candidatura]”, insisted Calviño this Monday, who recalled that this is a place that is “fundamental” for the financing of “major investment projects”, he said in statements to TVE.
The main function of the EIB is to grant financing for projects that contribute to the achievement of the objectives of the EU, both within its borders and abroad. They must therefore be projects of public interest. This financing can be given through a loan (the European Investment Bank offers credit to all kinds of clients, public and private, under favorable conditions), or through combined financing (it is possible to combine the financing received of the EIB with other investments). It should be noted, however, that this does not translate into money coming out of the European Union budget, but rather that the EIB is financed through the capital markets: financial markets where long-term debt is bought and sold. At the same time, it also offers advice and technical assistance.
90% of the funding goes to EU Member States
Although 90% of the funding goes to EU member states, projects from countries that are candidates to join the European Union, as well as third countries, are also financed, although to a lesser degree.
All of this, however, must be linked to projects that promote economic growth and employment, mitigation of climate change and the promotion of policies linked to cooperation and development with an impact on other countries. Through these, the improvement of industry, transport networks and communications, among others, is sought. For this reason, among its financings is the expansion of the Port of Barcelona in previous years.
In the current context, these are key pieces of the current European agenda, marked by the weaknesses that the pandemic and the war in Ukraine have brought to the surface: from the lack of technology to the energy dependence on fossil fuels and their suppliers, such as Russia.
72.5 billion in 2022
Spain is one of the countries that is most dependent on funding from the European Investment Bank, which is why the idea of a Spanish presidency is so juicy. In 2022 alone, of the 72,500 million that the EIB mobilized, most of it was allocated to projects linked to the energy transition and nearly 10,000 million went to the State. It is the second country, along with France, that received the most funding. Ahead is Italy.
In Catalonia, one of the latest agreements signed with the EIB affects Transport Metropolitans de Barcelona (TMB). The public transport manager of the metropolitan area signed an advisory agreement to promote prevention plans against harassment on public transport. An agreement that is part of the financing project worth 50 million euros for the acquisition of new “rolling stock”, such as subway cars.
Magdalena Álvarez’s failed attempt
The EIB was born in 1958 and its place of residence is Luxembourg. Since 2012, its president is the German Werner Hoyer, who came from Angela Merkel’s government. In fact, at that time a Spanish woman raised her finger to preside over this body: the socialist Magdalena Álvarez, who at the time was one of the eight vice-presidents of the body, a position she left in 2014 due to her imputation in the case of ERO in Andalusia. Hoyer was re-elected in 2017. In addition to the president and the eight vice-presidents, the EIB has a board of directors where one director from each EU country and one from the European Commission are present.
Calviño does not present herself now either. Among his competitors are the Danish Margrethe Vestager, current vice-president of the European Commission, and the former Italian finance minister during the last government of Mario Draghi, Daniele Franco. “The candidacy is strong,” boasted Calviño when asked about his options. Whether or not she ends up as president will be agreed by the European finance ministers at the informal Ecofin that will be held on September 15 and 16 in Santiago de Compostela (Galicia), although a formal vote will take place at the EIB council of October
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