EU Bank invests up to EUR 34 million for fast internet connection for rural Georgia

The European Investment Bank, the Bank of the European Union, will invest up to EUR 34 million in the expanding a high-speed internet network bringing fast and reliable internet services to some 500,000 Georgians living in 1000 rural and remote settlements in Georgia. The investment from the EU bank will finance the installation of 5000 km of fiber optics telecommunications network and provide open-access infrastructure for Georgian telecom operators to provide their fast-internet services. The EU has provided a guarantee through the External Lending Mandate.This project supports improved digital connectivity as one of the five flagship initiatives for Georgia under the European Union’s Economic and Investment Plan for the Eastern Partnership

This new EIB operation is a part of broader Team Europe efforts to support Georgia in digitalising, accelerating green and sustainable social and economic growth, and increasing nationwide resilience to natural disasters such as the COVID-19 pandemic.

Carl Hartzell, Ambassador of the European Union to Georgia, said: “Investing in the digital transition in Georgia is key to stimulate jobs and growth and bring about prosperity. Through the EU Economic and Investment Plan, we have already started to deliver real benefits on the ground. This flagship programme will assist in bringing new opportunities and reduce digital inequalities between rural and urban areas by developing high-speed broadband infrastructure for around 1,000 rural settlements. I consider this an important contribution to Georgia’s modernisation and economic development and recovery, while promoting digital inclusion in line with its national broadband strategy.”

• This EIB loan benefits from an EU guarantee under the External Lending Mandate.

Teresa Czerwinska, Vice President of the EIB, who is in charge of operations in Georgia, said:“Our investment in fast and reliable internet services for rural Georgia is more than another Team Europe investment to improve quality of life and doing business for Georgians. It supports digitalisation, the key to the long-term competitiveness of the Georgian economy and its sustainable and green development. Finally, this investment reinforces the recovery of the national economy from the pandemic. Together with Team Europe, EU4Digital the World Bank and the Government of Georgia, we are building modern infrastructure, a cornerstone for a modern and thriving Georgia. The EIB is proud to have contributed yet again towards this goal the whole of Team Europe shares with Georgia.”

Lasha Khutsishvili, Minister of Finance of Georgia said: “One of the main priorities of the Government of Georgia is the development of the digital economy. The improvement of broadband infrastructure is of the utmost importance in this regard. With the support of our international partner institutions such as the European Union, the European Investment Bank and the World Bank, we are aiming for this goal. This aspiration is demonstrated by the “Rural Fibre Network Georgia” project financed by the European Investment Bank. As one of the flagship projects within the Eastern Partnership priorities, it will promote digital development of rural settlements, that will ultimately be reflected in their economic growth. In addition it is in full compliance with Georgia’s National Broadband Strategy and Government’s programme for 2021-2024. I would like to express my gratitude to the European Union for its continued support and willingness to provide assistance in supporting and advancing the priority sectors of Georgia“.

• Some 500,000 people in 1000 villages will benefit from fast, reliable and affordable internet connection also expected to boost local businesses.
• The EIB loan supports improved digital connectivity for Georgia as a flagship initiative of the European Union`s Economic and Investment Plan for the Eastern Partnership.

Team Europe provides long-term strategic support to Georgia`s push to digitalise

The EIB loan will provide the digital backbone infrastructure required under Georgia`s Open Net Program and promote and extend affordable broadband internet to individuals and enterprises in rural areas of Georgia. The Open Net Program envisages the development of modern broadband infrastructure to reduce the digital divide in the country, improve living conditions, and create new opportunities for businesses.

The Open Net Program is the main component of the Log-In Georgia project, which promotes affordable broadband internet and extends its availability to individuals and enterprises in the country. On top of infrastructure development, Log In Georgia Project also has the potential to promote education, health and financial services as benefits of improved broadband connectivity in selected villages and increases digital inclusion of women, social minorities and persons with disabilities.

Log-in Georgia Project and Open Net Program as its main component fully support the implementation of the National Broadband Development Strategy 2020 – 2025, prepared with the support from the European Union and the World Bank. The EU and the World Bank provided two-fold technical assistance to the Government of Georgia in developing the Strategy. It included assistance in developing legal, policy, and regulatory reforms and help in creating an incentive scheme for investments in national broadband infrastructure.

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment to contribute towards EU policy goals.

The EIB in Georgia:

The EU bank has been supporting Georgia’s economic and social development since 2007, providing some €1.85 billion to the local economy to date. The EU bank’s activities in the country have supported key infrastructure projects (€1 billion), micro, small and medium-sized enterprises and mid-caps (€308 million), municipal infrastructure (€280 million) and green energy generation projects (€23.5 million). COVID-19 recovery activities in 2020 totalled €170 million.

Georgia is one of several non-EU countries eligible to benefit from European Investment Fund (EIF) operations, designed to support small and medium-sized enterprises (SMEs) with risk-sharing instruments. Today, the EIB Group portfolio of guarantees in Georgia covers €382.9 million in SME loans.