Black Sea Bank to invest in energy and transport projects in SEE

SOFIA, Jan 17, 2008 – The Black Sea Trade and Development Bank (BSTDB) sees energy and transport as the sectors most attractive for financing in Southeast Europe (SEE) in its development plan, a senior bank official said.
The development bank is focused on countries in the Black Sea region. In the SEE area it currently has operations in Bulgaria, Romania, and Albania and wants to expand there by attracting Serbia to join in, the head of policy and strategy at the bank, Panos Gavras, told the media.
The bank is ready to commit up to 10 million euro ($13.3 million) to projects in Black Sea neighbours, Bulgaria and Romania, and up to 3 million euro in Albania. The bank is usually providing financing for up to 35% of the project’s cost.
BSTDB currently has $61.5 million in outstanding loans to Albania, $57.2 million to Bulgaria, and $11.9 million to Romania.
“In general, for the smaller countries, because it is more difficult to find good-size projects there, we intend to be more flexible. Certainly, we are more willing to provide technical assistance to them,” Gavras said.
“Each country has its particular needs, in Albania we would really love to be involved in the energy generation projects, that is a huge bottleneck for them,” added Gavras.
“We will be extremely keen on financing transmission lines that would be a very high priority.”
Regarding Romania and Bulgaria, the banks sees a certain transport bottleneck and it will consider financing transport interconnections if projects emerge.
For the two EU newcomers, the bank could also consider financing residential and office construction projects, as these markets have been overdeveloped in big cities but not in smaller urban areas.
“Even though people are talking about a bubble, there is lots of needs out there and the bubble tends to be in places like Sofia and Bucharest,” Gavras said.
“In Plovdiv, Varna, Constanta there is a middle class growing and they want to move with their kids to a nicer place with a garden, to maybe a community.
According to Gavras, the launch of large-scale projects in Albania where the real estate market is still underdeveloped is open to question.
“I expect that you will see a trend like that at some point. There is no reason not to,” he said.