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CEB and Hungary sign €175 million loan agreement to cover additional COVID-19 medical services

15 July 2020

PARIS - The Council of Europe Development Bank (CEB) and Hungary’s Ministry of Finance have signed a €175 million loan agreement to provide medical services to those affected by COVID-19.

The CEB financing will help Hungary respond to the challenges posed by the COVID-19 pandemic by covering the costs of additional medical and pharmaceutical supplies and specialised equipment, such as medicines, face masks, disinfectants, diagnostic tests, ventilators, and ICU beds. It will also provide for the repatriation of medical staff stranded abroad and for any other measures aimed at improving the capacity of the health sector in Hungary.

Hungary has estimated that the current pandemic will create a €3 billion budget need by the end of the year, which represents about 2% of its annual GDP. Whereas the healthcare system fares better than the EU average in terms of the number of beds relative to overall population (69 beds per 100 000 residents, or 40% more beds than the EU average), it is heavily reliant on hospital care to the detriment of the primary care sector.[1]

Mihály Varga, Hungarian Minister of Finance and Deputy Prime Minister said: “Hungary is among the most successful countries in the European Union with relation to protecting against the virus, thanks to which in June it became possible to lift the state of emergency, which the government replaced with an epidemiological state of preparedness. Up to now, the Hungarian government has spent a total 600 billion forints (€1.7bn) on preventive measures with regard to the novel coronavirus epidemic. I highly appreciate the work of the CEB and its continuous commitment to the priorities of the Hungarian Government. This loan will contribute to protect lives and workplaces as well as restarting the economy in Hungary amid the difficulties caused by the coronavirus epidemic.”

CEB Governor Rolf Wenzel said: “The CEB has taken swift action to support its members in their fight against the unprecedented challenges posed by the COVID-19 pandemic, with more than €3 billion in financing approved to date. We are pleased to be able to support Hungary in its efforts to continue to provide much-needed COVID-19 medical services as well as to generally strengthen its health sector for the benefit of its people.”

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Hungary joined the CEB in March 1998. To date, the Bank has provided more than € 2 billion in financing for a wide range of social investments, from education and municipal infrastructure improvements, including flood protection, to support for MSMEs. Hungary is among the ten largest recipients of grant funding (interest rate subsidies, loan guarantees, and grants proper) from the Bank’s trust accounts. It has also contributed grant resources to the CEB’s Migrant and Refugee Fund. Additional info can be found here.


[1] 2019 Report on the State of Health in the EU.
https://ec.europa.eu/commission/presscorner/detail/en/IP_19_6336

Set up in 1956, the CEB (Council of Europe Development Bank) has 42 member states. Twenty-two Central, Eastern and South Eastern European countries, forming the Bank's target countries, are listed among the member states. As a major instrument of the policy of solidarity in Europe, the Bank finances social projects by making available resources raised in conditions reflecting the quality of its rating (AA+ with Fitch Ratings, outlook positive, AAA with Standard & Poor's, outlook stable and Aa1 with Moody's, outlook stable). It thus grants loans to its member states, and to financial institutions and local authorities in its member states for the financing of projects in the social sector, in accordance with its Articles of Agreement.

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