The European Investment Bank (EIB) as part of the Investment Plan for Europe has approved a EUR 500 million loan for Nokia to accelerate the research and development of 5G technology. The loan from EIB, which is also backed by the European Fund for Strategic Investments (EFSI), will allow Nokia to further invest heavily in research, development and innovation (RDI) in an area which can produce enabling technologies for innovation and growth in Europe.
5G technology is expected to enable faster speeds, massive connectivity, decade-long battery life for sensors and super-responsive and reliable networks for customers. This could power on-demand virtual reality (VR) and augmented reality (AR) experiences, driverless vehicles, medical monitoring, advanced industrial automation services, and other applications - all requiring ubiquitous, low-latency connectivity.
Nokia's end-to-end network proposition goes from the radio network to the internet protocol (IP) and optical networks for transmission, the packet core network, service platforms and all the software and services associated with the whole system. In essence, Nokia's portfolio covers all the needs of a telecom operator that wishes to provide fully converged fixed-mobile communications services critical for the era of 5G.
According to Nokia CFO Kristian Pullola, Nokia is excited to land this financing commitment from the EIB, who shares their view of the revolutionary nature of 5G - and the realization that this revolution is already underway. The financing bolsters Nokia’s 5G research efforts and continues the broader momentum the company has already seen this year in terms of customer wins and development firsts, supporting relentless drive to be a true leader in 5G - end-to-end.
The loan, which extends Nokia's debt maturity profile, has an average maturity of approximately five years after disbursement, which can take place at any time during the next 18 months.
The Investment Plan for Europe (Juncker Plan) focuses on strengthening European investments to create jobs and growth. It does so by making smarter use of new and existing financial resources, removing obstacles to investment, and providing visibility and technical assistance to investment projects. The European Fund for Strategic Investments (EFSI) is the central pillar of the Juncker Plan. It provides a first loss guarantee, allowing the EIB to invest in more, often riskier, projects. So far, the projects and agreements approved for financing under the EFSI are expected to mobilize EUR 335 billion in investments and support around 700 000 SMEs across all 28 Member States.
