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Victoria Mindova

1,700 small and medium sized enterprises benefited from the European Investment Bank financing programmes last year. The institution co-financed projects of small and medium sized enterprises with the National Bank of Greece. The European Investment Bank granted a 250 million euro low interest loan to the National Bank of Greece and 70 million for the same purposes to the Pankriti Bank. The news was announced by the Vice-President of the European Central Bank Plutarchos Sakellaris at the annual conference of the institution's activities in Greece.

The European Investment Bank has assisted in the establishment of innovation structures that facilitate the financing of projects in times of crisis. "For the first time the grants from the Structural Funds of the European Union are used as guarantees for the European Investment Bank to grant low interest loans to Greek banks. These new programmess allow for more rapid and effective use of EU funds by supporting the real economy."

Isolation of banks from international markets has made Greece seek alternative sources of funds that can allow the constantly shrinking Greek economy to take a breath. 2011 was a difficult but highly successful year as far as the European Investment Bank funded projects in Greece are concerned, said Plutarchos Sakellaris.

He stressed that unless the rumours of Greece exiting the eurozone end, large investors will not return to the country. "The biggest enemy of investment is uncertainty and therefore, the speculation of the country exiting the currency union should stop," the banker was adamant. Sakellaris said he was optimistic about the outcome of the crisis without denying that the current situation is a crisis. He insisted before GRReporter that Greece has made very serious efforts, particularly in recent months that have not remained unnoticed in Europe. "Just look at the job the Greek government has done in recent weeks. This is the reason to be optimistic."

From 1991 to today, the European Investment Bank invested nearly 2.7 billion euro in Greece for the construction of the underground in the capital. In 2011, the bank financed the renovation of the Omonia - Piraeus section of the urban electric train with 250 million. Another 310 million were allocated to the Public Power Corporation DEI to streamline its production of electricity with new environmentally friendly facilities. Part of the funds were used for a production centre powered by natural gas, and the rest were invested in optimizing the operation of the grid.

In 2012, the European Investment Bank is expected to invest primarily in public projects. Funds for repair of school buildings in the area of Attica, Central Macedonia and Crete should be made available as soon as possible. In central Macedonia and Thessaloniki, the Bank will finance projects related to waste management and in Patras and Heraklion, it will assist local governments in the repair of the buildings of local courts, which are in a desperate condition according to people familiar with the matter.

To the criticism that these funds are just a drop in the ocean and insufficient to stimulate entrepreneurship in Greece, Sakellaris replied, "They may be a drop, but they are still something. 2011 was very difficult for investors in Greece. If everyone in the country contributes in any way they can, then little streams will make great rivers."

Meanwhile, the International Monetary Fund has released its report on the sustainability of the Greek foreign debt, according to which 2011 will end with 164% foreign debt of GDP, reports The Wall Street Journal. As for the effect of the recovery programme, in 2020, the level of Greek government obligations will reach 129% of GDP instead of 120% of GDP, as are the hopes of the European Commission. Hours before the decisions of eurozone finance ministers on the future of the bailout to Greece, the Athens Stock Exchange closed again with a positive result compared with Friday's session. The main index rose by 0.18% and the daily turnover reached 98 million euro.