While EU finance ministers gave a cool reception to a proposal that they increase the European Investment Bank’s lending to outside countries by 50 per cent to $40.12 billion, only Malta’s prime minister, Lawrence Gonzi, gave some support to the broad goals of the commission’s proposal.
Dr Gonzi said that loans to Northern African countries in particular might help to discourage immigration to Europe..
The EIB’s current lending cycle – with a ceiling of $26.36 billion for countries outside the European Union – will expire in 2007.
The commission recently completed a proposal for the EIB’s next lending cycle to go through 2013, EU Economic and Monetary Affairs Commissioner Joaquin Almunia told reporters after presenting the report at a finance ministers’ meeting on Tuesday.
Ministers must make a final decision later this year on how much they will allocate in loans.
Almunia said the EIB’s past and current activities outside the EU have enhanced the impact and visibility of the bloc, which he said justifies the push to increase its visibility around the world.
The commission proposes that only $11.46 billion of the loan money go to EU hopefuls Croatia, the former Yugoslav Republic of Macedonia and Turkey.
The bulk of the cash would go to countries surrounding the EU, with $12.74 billion to Mediterranean countries lining the bloc and $6.37 billion to Eastern neighbors. Latin America would see $5.09 billion, Asia $2.55 billion and South Africa $1.91 billion.
This new mandate would land a much greater ratio of EIB cash in Central Asia and the Caucasus.
But the other EU finance ministers were not keen on these suggestions.
The EIB does many important things, said Dutch Finance Minister Gerrit Zalms. But it shouldn’t try to copy the actions of the World Bank.
He said the bank should focus on possible EU candidates and gradually phase out loans in Asia and Latin America. Spain’s Pedro Solbes, Denmark’s Thor Pedersen and Hungary’s Janos Veres also said the bank needed to stay closer to home and keep its eye on European priorities.
The commission’s report stressed that, in the past, EIB loans to outside countries have gone largely to supporting European businesses.
Almunia cited examples such as the expansion of a German car manufacturer in Argentina, Brazil and Mexico through some $254.72 million in EIB loans, and the construction of liquefied natural gas plants in Egypt by French, British and Italian companies using $636.8 million in EIB loans.