NIB President: Creating a productive sector the biggest challenge for the Baltics

Speaking at the Baltic Economic Forum in Riga, NIB President Johnny Åkerholm stressed the role of public and private resources in ensuring the accessibility of financing for growth strategy.

Mr Åkerholm pointed out that the EU Baltic Sea Strategy adopted in 2009 will help stimulate a re-emergence of financial inflows to the Baltic region. It will also help re-engage funds in useful activities, but it will not be enough to jumpstart the Baltic economies.

“More attention should be paid by the Baltic countries themselves to increase their attractiveness to financing in order to be able to finance the large investment needs which loom ahead,” said Mr Åkerholm.

A large majority of the activities included in the strategy falls within the focus areas identified by NIB. In the environmental area, NIB is interested in projects supporting the clean-up of the Baltic Sea and mitigating and adaption to the climate change. The Bank is also eager to participate in efforts to improve the access to and security of the energy markets. Internal and external transport links are also crucial for the region as well as research and innovation.

The NIB President noted that the availability of finance provided by the international financial institutions does not guarantee the implementation of projects.

“The Baltic countries are well advised to grab this opportunity, since many of the projects will not only provide short-term stimulus to the economy but also greatly help to strengthen the foundation for longer term sustainable growth. The implementation will not stumble on financing, but viable project structures as well as able and willing borrowers will be needed,” he said.

More efforts will be needed in order to stimulate the influx of financial flows to the region. In the next years, financiers will pay more attention to the ability to service the loans. Mr Åkerholm praised the measures the Baltic governments have taken to re-establish balance in the public sector.

“The biggest challenge is to generate a productive sector, which can pay the costs that ever increasing aspirations concerning income and purchasing power require,” Mr Åkerholm continued.

He emphasised the Baltic countries would gain from developing the infrastructure of transport and logistics, improving the security of energy supply as well as stimulating investments in R&D and innovations. These activities require a regional perspective and long-term financing. This is why NIB pays particular attention to financing investments in these sectors.