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Cyprus is the largest beneficiary of EIB support per capita in the EU

Finance Minister Makis Keravnos, at a meeting with the President of the European Investment Bank (EIB), Werner Hoyer
Finance Minister Makis Keravnos, at a meeting with the President of the European Investment Bank (EIB), Werner Hoyer

Cyprus is the leading beneficiary of European Investment Bank (EIB) support per capita with €250 million in funds received during 2022, EIB president Werner Hoyer said during a visit on Friday.

Hoyer met with Finance Minister Makis Keravnos where the EIB expressed its deep satisfaction that major development projects such as the university campus, the museum, student dorms, laboratories, electricity works, and many other projects are underway.

Hoyer said that Cyprus’ accession to the EU and the productive relationship with its development bank is an “amazing story”.

For his part, Keravnos said that Cyprus is in tune with the EIB’s goals: “The green transition is a top priority for Cyprus, accelerating this process is essential for the economy.”

Hoyer emphasised that the EIB’s role extends to more than just funding, as they also offer invaluable expertise for the type of projects which are being developed. He explained that the EIB is largely managed by engineers and scientists who can therefore provide substantial technical support.

The EIB president added that VP Liliana Pavlova has had excellent ties with Cyprus and is due to visit again in two weeks when more detailed discussions are set to take place.

Other projects being funded in Cyprus include new labs and major development works to make municipalities greener – with the aim of generating more sustainable economic growth.

The EIB previously explained that the largest project in 2022 by far was the Municipal Strategic Plan for Sustainable Development. It added that the project was set up by the Cypriot government and the union of Cyprus municipalities. It will finance numerous projects to regenerate and rehabilitate municipalities across Cyprus. The EIB is supporting the plan with a €150m framework loan.

Last year the EIB also provided €100m of targeted business financing support SMEs and MidCaps through the Cyprus Entrepreneurship Fund, Hoyer said. He added that through the European Investment Fund the EIB supported the finance ministry to establish the Cyprus Equity Fund, the first private equity fund in Cyprus which will enhance access to finance for start-ups and innovative companies – providing a long-lasting impact on the Cypriot economy.

Hoyer also recognised the impacts faced by member states from the Russian invasion of Ukraine, with the EIB president praising Cyprus for its role in supporting Ukraine.

He explained that the EIB has been able to approve and disburse €1.7bn of financial assistance to Ukraine, adding that another €500m will be disbursed over the coming weeks and months.

Hoyer also said that the EU is fully aware of the enormous contribution of Cyprus to solving the humanitarian issues that go along with refugee flows, adding that the number of asylum seekers in the country in comparison or in relation to GDP is probably the highest in the EU and a huge burden on the economy, the country and the society.

EIB support for Cyprus in 2022 represented 0.94 per cent of GDP, second only to Greece among all EU countries, while the EU bank’s outstanding overall exposure to date moved to approximately 12 per cent of the country’s GDP, putting Cyprus at the top of all EU countries in which the EIB is operating in terms of support, per capita.

The group further explained that the latest support, and strong history of activity in Cyprus, underlines the EIB’s commitment, especially during some challenging recent years for the Cypriot economy. Between 2013 and 2022, the EU bank’s lending activity in Cyprus reached a total of €2.5bn.

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