European Investment Bank (EIB)

Croatia : EIB continues to support smaller projects and finances chemicals production upgrade - the first larger corporate project in the country

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Source: European Investment Bank (EIB)

The European Investment Bank (EIB) provides two loans in Croatia:
  • EUR 250 million to the Croatian Reconstruction and Development Bank (HBOR - Hrvatska Banka Za Obnovu i Razvitak) to finance projects of small and medium-sized companies (SMEs), mid-cap companies and municipalities in Croatia and
  • EUR 34 million to HBOR to support the upgrading and extension of the chemicals production of Dina Petrokemija d.d. 

The loan of EUR 250 million will finance SME projects and medium-sized companies projects in the area of industry and services, including tourism, small and medium-scale infrastructure schemes promoted by local authorities and projects supporting the establishment of the knowledge based economy and investments in the areas of energy, environmental protection, health and education.

This loan is in line with the EIB’s priority of strengthening its support for Europe’s SMEs to help mitigate the effects of the current financial crisis. To this end, the EIB is joining forces with well established financing institutions, like HBOR, that know the local market, have SMEs, midcap companies and municipalities as their customers and possess a well developed network. It is expected that grant schemes provided by the European Commission under the Energy Efficiency Finance Facility will be included in the loan. The current loan is a continuation of the successful cooperation between the EIB and HBOR. The EIB has previously provided four credit lines to this financial institution amounting to EUR 360 million supporting SME investments.

The loan of EUR 34 million will finance the upgrading of an existing vinyl chloride monomer plant and the construction of a new plant for the production of polyvinyl chloride (PVC) of Dina Petrokemija d.d., a subsidiary of Dioki d.d. The project aims at meeting local and international demand for PVC and is line with Croatia’s industrial policy to diversify and develop its manufacturing industry.This is the first time that EIB funds have supported a larger project promoted by a corporate in Croatia.

Background

The mission of the EIB, the European Union’s bank promoting European objectives, is to contribute to the integration, balanced development and economic and social cohesion of the Member States by financing sound investment. In Croatia – an EU Acceding Country – the EIB supports investment projects that prepare the country for EU membership.

Since 2001 the EIB has provided loans in Croatia worth some EUR 2.2 billion, including the current loans. The EIB’s lending portfolio in Croatia is very well balanced and covers all of the country’s economic sectors, ranging from basic infrastructure to manufacturing and services, including support for small and medium-sized companies through local financial institutions.

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