€3.4 billion is on the way to modernise and upgrade 178 km of the Palermo-Catania railway line. This funding is being made available for infrastructure improvements in Sicily as a result of the agreement presented at the Ministry of Infrastructure and Transport by Deputy Prime Minister of Italy Matteo Salvini, European Investment Bank
(EIB) Vice-PresidentGelsomina Vigliotti, CEO of Ferrovie dello Stato Luigi Ferraris, Acting Deputy Director-General for Mobility and Transport at the European Commission Herald Ruijters, CEO of CDPDario Scannapieco and Chief of Imi Corporate & Investment Banking Division at Intesa Sanpaolo Mauro Micillo.
This financial operation is the first of its kind in Italy in the infrastructure sector, combining direct financing to the government (with favourable funding conditions) with support for credit institutions, which play a fundamental role in facilitating the implementation of large-scale infrastructure projects (such as the Palermo-Catania line) by issuing the guarantees provided for in the works contracts.
In detail, the agreement provides for: €800 million in direct financing from the EIB to the Ministry of Economy and Finance (MEF), of which the first €200 million tranche has already been executed.
A €1.3 billion counter guarantee, also provided by the EIB and developed in conjunction with Ferrovie dello Stato Italiane, in favour of financial intermediaries. The first €500 million of this sum has been allocated to Intesa Sanpaolo, the bank that pioneered the project by helping to outline the instrument, and €300 million has been allocated to CDP. The remaining €500 million will be allocated to other financial intermediaries at a later stage. This instrument is an operational first for the EIB, and is intended to counter guarantee the contractual guarantees issued by financial institutions in favour of Rete Ferroviaria Italiana S.p.A. relating to eligible and successful contractors. The 50% counter guarantee will generate guarantees from financial institutions amounting to twice the EIB commitment, resulting in a total of €2.6 billion in guarantees available to implement construction contracts and subsequently start work. In addition to this, the MEF will receive €800 million in direct funding, bringing the total sum available for modernisation of the Palermo-Catania railway line to €3.4 billion.
The counter guarantee behind the EIB's €1.3 billion guarantee is supported by InvestEU, the European Union programme that aims to mobilise €372 billion of investment by 2027, and of which the EIB Group is the main implementing partner. The financial structure of the operation will facilitate implementation of the works thanks to the counter guarantee provided to the financial institutions and the increased credit support this provides to the companies involved in the construction of the railway infrastructure. It comes in addition to the €1.4 billion in National Recovery and Resilience Plan financing allocated to investments in the Palermo-Catania line.
The resources will contribute to the modernisation and upgrading of 178 km of the Palermo-Catania railway line, between Fiumetorto and Bicocca, connecting the northern and eastern coastal urban areas of Sicily with the interior of the region. The infrastructure is part of the Scandinavia-Mediterranean Corridor of the TEN-T (Trans European Network Transport) network. Freight and passenger trains will travel at a maximum speed of 200 km/h, helping to reduce the travel times on this route by approximately 60 minutes. As a result, direct trains between the two cities will take two hours instead of the current three. The project will contribute to the economic and social development of the region and promote the development of sustainable mobility.
