EBRD and InvestEU Back Innovative Financing Deal to Promote Copper Recycling and Water Efficiency in Bulgaria

EBRD and InvestEU Back Innovative Financing Deal to Promote Copper Recycling and Water Efficiency in Bulgaria

(IN BRIEF) The European Bank for Reconstruction and Development has provided a €20 million loan to Sofia Med in Bulgaria, backed by an InvestEU guarantee, marking its first sustainability-linked loan in the country. The financing ties loan pricing to environmental performance targets, including increased use of recycled copper and improved water efficiency. The initiative supports Bulgaria’s green transition while addressing challenges such as copper recycling shortages and infrastructure needs. The project builds on the EBRD’s long-standing partnership with Viohalco and reflects its broader strategy to promote sustainable industrial development. To date, the EBRD has invested over €5 billion in Bulgaria, continuing to play a key role in advancing the country’s economic and environmental goals.

(PRESS RELEASE) LONDON, 30-Mar-2026 — /EuropaWire/ — European Bank for Reconstruction and Development has expanded its corporate financing activity in Bulgaria with a €20 million loan to Sofia Med, a subsidiary of Viohalco. The transaction is supported by a guarantee under the InvestEU programme and represents the first EBRD loan in Bulgaria to incorporate sustainability performance into its pricing structure.

The financing introduces a Sustainability-Linked Loan (SLL) framework, tying loan conditions to measurable environmental targets. Specifically, the agreement focuses on increasing the share of recycled copper used in production and improving water efficiency, both key priorities in Bulgaria’s transition towards a greener and more resource-efficient economy.

Copper plays a central role in the global energy transition, supporting electrification, renewable energy systems, and electric mobility. As demand continues to rise, improving recycling rates is becoming increasingly important. While recycled materials currently account for around 30% of global copper demand, Europe faces a shortage of available scrap due to significant exports. At the same time, Bulgaria is working to enhance water efficiency, requiring upgrades to infrastructure and industrial processes.

Under the agreement, the EBRD provides financing backed by an InvestEU first-loss guarantee covering just under 25% of the risk. This mechanism enables the Bank to offer Sofia Med more favourable loan terms, with pricing adjustments linked directly to the company’s ability to meet agreed sustainability targets.

The project builds on a long-standing relationship between the EBRD and Viohalco Group companies, which has included support for energy efficiency initiatives, expansion into green product applications, and other environmentally aligned investments in both Bulgaria and Greece.

The EBRD remains a major institutional investor in Bulgaria, having committed more than €5 billion across 320 projects to date. In 2025 alone, the Bank financed €295 million in private sector investments in the country, reinforcing its role in supporting economic development and sustainability.

Through its current country strategy for Bulgaria (2025–2030), the EBRD continues to prioritise decarbonisation, improved resource efficiency, and the transition of industrial sectors towards more sustainable practices.

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SOURCE: EBRD