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| Sunday, 3 November 2002 |
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Euro 40m loan to Sri Lanka The European Investment Bank (EIB) has approved a Euro 40 million loan to assist in financing small and medium-scale projects in Sri Lanka. This is in the context of the Board of Governor's authorisation for lending in Asia and Latin America for the period 2000 - 2007. In particular, it would strengthen the international presence of European companies as priority in allocations will be given to investments undertaken by the European Union (EU) subsidiaries, EU joint ventures or transfer of technology. The finance contract will be signed before the end of the year in Luxembourg or Colombo. The proposed line of credit would assist the development of small and medium-scale investments by making available, at competitive market rates, long-term financial resources. These investments would help in the revival of the economy and in particular in the areas most affected by the civil war. Being a multi-sectoral facility, the proposed loan will contribute to the ongoing diversification of Sri Lanka's economic base. Special attention would be given to export-oriented activities and productivity improvement investments. The borrower would be the Government of Sri Lanka who would then lend to DFCC Bank, the financial intermediary. DFCC would sub-lend to finance small and medium size investments undertaken by the financial beneficiaries. The global loan would be available for projects in industry (including agro-industry) and related services, infrastructure, tourism, energy, information technology, environmental protection and telecommunications. All allocations will be required to comply with Sri Lanka environmental standards and practices and where appropriate, benchmarked against those of the EU, as well as EIB environmental assessment and reporting requirements for operations of this type. |
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