Funding Ukraine weapons would put EU lending arm on 'wrong track', outgoing chief warns
investing.comBy Rodrigo Campos
NEW YORK (Reuters) — The head of the European Investment Bank (EIB) has warned his soon-to-be-announced successor that bowing to pressure from some EU capitals to fund weapons for Ukraine would put the bank on the «wrong track». Werner Hoyer will step down from the EU's powerful lending arm at the end of December after 12 years turning the EIB into one of the world's largest providers of climate finance.
Its balance sheet runs over a half trillion euros and its next head, tipped to be either Spain's Finance Minister Nadia Calvino or Denmark's EU competition chief Margrethe Vestager, will face a raft of challenges.
The EIB will be expected to play a key role in the rebuild effort in Ukraine. Some politicians though, including from France and Germany, have raised the idea it provide defense industry funding to also help Ukraine on the battlefield.
The EU has bankrolled weapons to Ukraine to the tune of billions of dollars. But Hoyer said the EIB's involvement would be a fundamental change that could harm its image and credibility.
«Some of our partners in the capital markets, they have now inhaled, internalized, ESG thinking,» Hoyer told Reuters in an interview, referring to environmental, social and corporate governance issues.
«If we use their money to buy ammunition, we're on the wrong track,» he added. «It will be controversial. I don't envy my successor.»
Back in 2014, after the annexation of Crimea by Russia, the EIB stopped funding projects in Russia and redirected the money toward Georgia, Moldova and Ukraine.
Hoyer's replacement — the full shortlist consists of five candidates — will also lead the EIB's influential role in Europe's transition towards a more digitized, net-zero-carbon economy.
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