EIB agrees to loan Budapest €300 mln for development

Int’l Relations

The European Investment Bank (EIB) said it signed agreements yesterday to loan the City of Budapest €300 million for use in transportation projects, urban renewal – and projects aimed at improving energy efficiency and protecting the environment.

EIB Vice President László Baranyay, right, and Budapest Deputy Mayor Gábor Bagdy during a press conference after the loan agreements were signed. (Photo: MTI/János Marjai)

According to the EIB, the agreements cover two loans:

  • €200 mln as the first tranche of a €350 mln loan that is to be used for investments in public transport and road networks in the capital;
  • €100 mln, which is the first part of loan to toal €200 mln that is meant to support urban renewal, improvements in energy efficiency and environmental protection.

EIB Vice President László Baranyay said: “The EIB will provide favorable funding conditions and liquidity for a long tenor, supporting priority investments under the Hungarian capital’s Integrated Urban Development Strategy. This is vital for the city’s continuing sustainable social and economic development, strengthening its competitiveness through the improvement of its attractiveness to investors, increasing the quality of life and upgrading the urban environment,” according to the EIB.

According to state news agency MTI, Deputy Mayor Gábor Bagdy said the agreements will help to sustain the momentum of Budapestʼs development and to mobilize the capitalʼs own funds.

The financing is to be made available in early 2016 and it is being offered at “favorable” interest rates, Baranyay said, according to MTI.

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