EU investment bank to provide loans for clean-car development

BRUSSELS, Mar. 9 (Chinese media) -- The European Investment Bank, leading arm of the EU, has planned to inject 7 billion euros in loans into the automobile industry to develop clean cars, bank chief Philippe Maystadt said here on Monday.

"By the end of June, we will probably have approved loans totalling 7 billion euros" to the automobile sector, aiming mostly at supporting projects of clean-car development, but not helping the industry out of the financial crisis, Maystadt told reporters.

"As the long-term financing arm of the EU, we cannot bail out companies in difficulties: this is not our mission. We cannot provide short-term liquidity, because we are not a central bank, and we cannot provide restructuring in sectors which need it," he said.

The EIB, founded in 1958, is to provide long-term financing for projects aimed at bringing EU states closer together, with the EU's 27 member states as its shareholders.

The sum is much less than the 40 billion euros the car industry had required but much more than the 4 billion euros the European Commission called.

The European automobile sector, which employs around 12 million people, has been hit hard by the financial and economic crisis, as vehicle production fell by 28 percent in the final quarter of last year, according to the European Automobile Manufacturers' Association (ACEA).

The European Commission, the executive arm of the EU, called in November for an aid package of 5 billion euros, including 4 billion from the EIB, to help the European car industry develop climate-friendly cars to face the global financial crisis and climate change.