Romania Asks Renault To Use EIB Loan Only For Testing Center, To Pay Risk Premium

Romania will ask France's Renault to use the EIB loan taken with state guarantees only for its Renault Technologie Roumanie (RTR) car testing center in Titu, and to pay an annual risk premium of 0.55% of the guarantee, which is worth EUR66.6 million, people close to the talks told Mediafax.

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The guarantee will be granted after authorities evaluate the carmaker’s capacity to reimburse the loan from own sources, to limit the risks.

According to the sources, the government already accepted to grant a EUR28.1 million state aid for RTR center between 2008-2010, to extend national road DN7 to four lanes, to grant fiscal incentives for research, to reimburse EUR0.6 million for depolluting the location and to draft a bill regulating the employees’ inventions.

The RTR construction works require total funds estimated at EUR450 million, out of which EUR166 million in the first stage. The works started in September 2008 and are scheduled to be completed by the end of 2010.

For the first stage of the investment, Renault asked the European Investment Bank for a EUR83 million loan, requesting a state guarantee for 80% of the loan.

According to the quoted sources, the loan will be granted for seven years, at an annual interest rate of 6%

The government approved Wednesday the Finance Ministry’s negotiation mandate to issue the guarantee.

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