Mattie McGrath (Tipperary South, Independent)
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488. To ask the Minister for Agriculture, Food and the Marine if he will provide the levels of funding received from the European Investment Bank for national resource management and primary production, transport storage-quality control infrastructure, processing facilities such as dairy processors, and by product usage; and if he will make a statement on the matter. [30599/15]

Simon Coveney (Cork South Central, Fine Gael)
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Earlier this year, the European Commission and the European Investment Bank (EIB) presented a model guarantee instrument for agriculture, developed with in the framework of their Memorandum of Understanding on co-operation in agriculture and rural development within the EU. The model instrument aims to help ease access to finance for farmers and other rural businesses. Member States and regions can adapt and use this model to set up financial instruments funded by their rural development programmes (RDPs) under the European Agricultural Fund for Rural Development (EAFRD). Financial instruments can take the form of loans, guarante e funds or equity investments. The funding for any such financial instruments would have to draw on Ireland’s existing RDP allocation of European Agricultural Fund for Rural Development funding as well as National Exchequer funding. It is also possible to incorporate funding from other sources for such instruments. In our RDP, we have made a commitment to examining the potential for the use of financial instruments. However, the inclusion of financial instruments by way of a modification to the RDP is required by EU regulation to be based on an ex ante evaluation which must assess:

- The existence of a market failure;

- The potential for added value;

- The resources required to implement a proposed financial instrument; and

- The proposed strategic approach to financial instruments.

Accordingly, I have asked my officials to engage with the European Commission, the EIB and other stakeholders in order to identify areas where financial instruments could be implemented to best strategic effect, and to explore the practical steps which are required in order to i mplement financial instruments. Any such financial instruments are required by EU regulation to be structured on a clear investment strategy which identifies real market failures and economic needs.

In addition to this, my Department has been exploring new and more competitive sources of funding and will continue to do so in the context of evolving market requirements. The Strategic Banking Corporation of Ireland (SBCI) was established by the Government as a strategic SME funding company and includes the EIB as one of its funding partners. Among its range of products is an ‘Agriculture Investment Loan’, available for investment by agricultural SMEs involved in primary agricultural production, the processing of agricultural products or the marketing of agricultural products. The features of these products compared with those currently on the market are lower interest rates, loan amounts up to €5m and increased repayment flexibility. Of the almost €45 million in loans approved and drawn down by SMEs between March and end-June from the SBCI, a third has been accessed by the agricultural sector.