ENERGY: Cyprus seeks EUR 150 mln EIB financing for Nat gas infrastructure

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Cyprus is in talks with the European Investment Bank (EIB) for over a €150 mln in financing for the construction of infrastructure to transport natural gas to the island, said Finance Minister Harris Georgiades.

EIB President Werner Hoyer appeared optimistic that the credit institution will be able to take part in the project.

“From 2013 until today we have signed financing agreements of a value of €1.5 billion,” the Finance Minister said at a Nicosia press conference Monday.

“Half of that amount is aimed at small and medium size enterprises through Cypriot banks, this has contributed in a decisive way to the Cypriot economy’s recovery,” he added.

The government aims to maintain and expand on financing programmes for small and medium size enterprises.

However, Georgiades pointed out, “we are also interested in cooperating, financing, for a project of strategic importance, that of funding infrastructure for natural gas to be transported and used in Cyprus.”

Negotiation for this large and important project is underway, said Georgiades adding that “we are interested in financing up to €150 million and I hope that in the context of our cooperation we will have a positive outcome.”

Asked to give further details of the project he said that efforts are ongoing and that there is nothing to announce just yet.

He said however that the government has already secured EU funding and is now interested in financing by the EIB. “I hope by the end of the year we will be in a position to announce something,” Georgiades said. 

Hoyer confirmed that the EIB is in talks with the Cypriot government for the project.

“I am quite optimistic…we are presently developing and publicly discussing a new energy lending policy, but I believe that even within the framework of the new policy we will be able to be part of this exercise.”

“It is an important project also in view of climate action…the replacement of present fuels by this newly found gas or purchased is of course an improvement for Cyprus but also for the continent.”

EIB`s President referred to the investment made in Cyprus by the Bank, which has totalled €4 bln since 1981.

Referring to the €1.5 bln investment made since 2013 crisis, Hoyer said “it reflects the fact that “when the financial crisis hit and many banks left the country, we strongly increased our activities in Cyprus, and we have not regretted it.”

“The Cypriot people faced some challenging years, but we are confident that these are now behind us.”

Hoyer added: “Challenges still lie ahead and the EIB will continue supporting worthwhile projects that can accelerate economic growth and sustainable development, essential to further improving the Cypriot economic situation.”

Anita Furstenberg, EIB Director said that in 2018 the bank provided €140 mln to support private sector investment in Cyprus through new credit lines managed by Cypriot banks

“Since 2014, when we launched our SMEs and MidCaps scheme, the EIB has made €780 mln available to locally active banks.

“In total €575 have been allocated that has supported more than 450 new investments by Cypriot companies,” Furstenberg said, adding that a significant percentage went to support the tourism sector.


The EIB official also said that in 2018 the bank signed new financing totalling €60 mln to support public sector infrastructure investment.

She explained that the relevant ministries promoting infrastructure projects can combine EIB and EU grants.

“This improves absorption of EU structural funds and facilitates implementation of projects across a wide range of sectors, including waste treatment, water supply, transportation, urban regeneration, energy and environment,” Furstenberg said.

The EIB has agreed to provide €10 mln for the purchase of three new eco-friendly ships, by a newly established shipping company in Cyprus.

“Looking ahead EIB’s activity in Cyprus is expected to remain robust in 2019,” she noted.

“As the EU bank, she added, we will continue investing in sound and sustainable projects in line with EU policies such as energy efficiency and renewable energy projects which help combat climate change.”

Furstenberg also spoke of a willingness to assess possible solutions for accommodation for young couples and students and possible support for affordable housing.