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The Warsaw Voice » Other » November 19, 2008
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Loans for Innovation
November 19, 2008   
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Marta Gajęcka, vice-president of the European Investment Bank, talks to Piotr Bartosz.

The Polish minister for science and higher education, Barbara Kudrycka, says Poland has the potential to become a major partner in European scientific research. Do you share this view?

Yes. Polish scientists enjoy an excellent reputation not only in Europe but all over the world. This doesn't change the fact that Poland still has great needs in terms of infrastructure. Science needs proper financing to develop. The European Investment Bank can be particularly helpful in this area. So far we have granted Poland two loans, for 600 million and 475 million euros, for the development of science, research and innovation.

Was this just for applied research or fundamental research as well?

There are no restrictions. Anyone can submit a project and our Polish partners decide what kind of research receives funding. I hope this cooperation develops in many directions. That's why, apart from purely banking products, we develop new instruments, such as the Risk-Sharing Finance Facility (RSFF), to meet new challenges.

Some say this instrument is primarily addressed to the business sector and companies that conduct research or work with researchers. Is the RSFF also targeted at scientists themselves? Who can apply for loans in this system for their projects?

In the RSFF system the EIB provides direct financing for projects whose planned costs exceed 25 million euros. If someone has a project that big, they can apply for a loan. If project costs are lower, we work with commercial banks and provide a global loan through them, with the banks passing on the EIB's money, so to speak, on the same attractive terms. This is a practical solution in many ways, which means we value good cooperation with the banking sector. We also work with the government by granting framework loans that are subsequently disbursed for various research projects, universities, infrastructure and so on.

The RSFF has attracted the interest of Polish research organizations, universities, and businesses. Why do you think all these entities need special loans for innovation?

They need them because research projects carry a higher level of risk. This risk hampers and often precludes access to a loan through classic banking procedures. We filled this niche and responded to the need by developing the RSFF instrument together with the European Commission. To put it briefly, the EIB provided 1 billion euros, and the European Commission forked out another billion. The 2-billion-euro facility makes it possible for us to generate 10 billion euros. This means that every euro "produces" five euros. That allows us to grant loans and guarantees to entities that decide to proceed with projects carrying greater risk. In principle, the bank finances up to 50 percent of the value of an investment project.

Under the Lisbon Strategy, spending on science in EU member states should account for 3 percent of GDP. In practice, this means mobilizing the private sector; it's very important to connect the world of science with the private sector so that research results can be applied in the real world.

What fields of research are of special note in this context?

Examples include biotechnology, pharmaceuticals, and the automotive industry-all sectors that involve highly specialized research. Another such area is renewable energy.

According to Poland's National Contact Point for EU Research Programs, examples of project topics include the Clean Coal Joint Technological Initiative and a strategic aeronautical research project known as the Aviation Valley. The EIB will be responsible for Europe's flagship Carbon Capture and Storage (CCS) project involving technologies for trapping and storing carbon dioxide. Is special funding available for clean energy projects being carried out by Polish companies?

Energy is one of the top priorities in both Poland and other EU countries. Poland is obligated to reduce its carbon dioxide emissions within a certain time frame. The proportion of renewable energy in Poland-and in Europe in general-could be much greater than it is today.

There are many financing options, not only from the RSFF but from a whole range of other products we have to offer. Carbon capture technology is being discussed in Brussels and I can confirm that the EIB is ready to finance projects that serve to implement EU policies. The details depend on what a specific project is and what exactly we are talking about.

What specific projects can obtain funding from the EIB and what conditions have to be met to receive funds? Are your loans only intended for people who have been working with industry for many years?

Our loans are available to anyone with a good project. If they contact us, we will analyze the project in technical, financial, economic and environmental terms. It's unimportant whether someone has worked with the bank before; only the project's quality counts. A good project has to fulfill the eligibility criterion-it has to be compatible with one of the bank's six priorities. These are economic and social cohesion; innovation, research and development; small and medium-sized enterprises; transport; and the environment and energy. We also have to check if the project is financially feasible, and whether the entity in question is able to finance it to ensure its success. We also check the credibility of the borrower.

Can scientific institutions be credible borrowers?

Of course. If someone is unsure if their project is eligible for EIB financing, the simplest thing to do is to contact the bank's Warsaw office at 1 Piłsudskiego Sq. and get directly in touch with the people there who can answer all the questions. If a research team or a company wants to obtain funding from the EIB, instead of wondering if it's a good or bad idea and whether it's worth going ahead with, it's better just to ask us.

How important is Poland as a partner for the EIB?

Poland is our biggest borrower among the new member states. In terms of all approved loans, Poland is in sixth place in Europe.

Banking on It

The European Investment Bank (EIB), headquartered in Kirchberg, Luxembourg, is a lending institution of the European Union that was established in 1958 under the Treaty of Rome. A policy-driven bank, the EIB supports the EU's priority objectives, especially European integration and the development of economically weak regions. Recently, the bank has also been actively supporting European research and development projects as part of EU's objective of building the world's leading knowledge-based economy.

The EIB is an international financial institution and a publicly owned bank. Its owners are the member states of the European Union, who contribute to the bank's capital, which stood at 164 billion euros at the end of last year. As shareholders the member states are represented on the bank's main independent decision-making bodies-the board of governors and the board of directors. The EIB extends around 50 billion euros per year in the form of various loan products.

Marta Gajęcka has been vice-president of the EIB since Aug. 16, 2007. She is responsible for financing the bank's operations in Poland, the Czech Republic, Hungary, Slovakia, Slovenia, and Bulgaria. She is also in charge of trans-European transport and energy networks as well as corporate social responsibility.
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