— The European Investment Bank (EIB) is offering a half-dozen financing instruments to aid in the development of services related to satellite navigation, and specifically to ‘s Galileo project, EIB President Philippe Maystadt said June 24.

Addressing a conference here organized by the European Economic and Social Committee and the Committee of Regions, Maystadt said financial aid in the form of venture capital-type equity stakes, loans to projects with low- or sub-investment grade ratings and more traditional financing for research projects are among the resources EIB is prepared to make available for Galileo projects.

“We have a special interest in the development of the Galileo program, which has immense potential for the development of services,” Maystadt said. “We are prepared to invest with both the public and the private sector in developing Galileo infrastructure as and when appropriate.”

But Maystadt warned that EIB financial participation in Galileo would depend in part on the predictability of the project’s in- service date. Using dates that have long been abandoned by government and industry officials involved in the Galileo project, Maystadt said: “The success in keeping with the timetable is crucial as it will affect the extent of the investment that [investors] will make in anticipation of the system coming into service in 2012-

The 30-satellite Galileo constellation is unlikely to be in service before 2014, and even that date depends on a loose definition of “in service,” government and industry officials say.

Maystadt said the EIB views Galileo as an example of ‘s politically stated goal of becoming a global leader in information and communications technologies. EIB’s shareholders are the same European Union governments that are financing Galileo’s development.

Promoting research, development and innovation related to the positioning, navigation and timing services to be offered by Galileo is a high priority of the EIB, Maystadt said. He said the bank has about 10 billion euros ($15.6 billion) a year at its disposal for projects that fall into this category.

The EIB has more than 1 billion euros annually that is devoted to projects deemed too risky to attract conventional bank funding. Maystadt said mid-size companies developing new markets using Galileo-enabled services would be likely candidates for that kind of high-risk financing.

An EIB subsidiary managing the European Investment Fund as a venture capital investor is another potential source of Galileo backing, Maystadt said. This fund already has invested some 900 million euros in information and communications technology projects.

EIB Director Tom Barrett said that despite the tightening credit markets, “there is no shortage of funding” for projects with promising business plans. But Barrett also stressed that keeping to the timetable is important for EIB investors, just as it is for private-sector investors.

“The target date is Barrett said at the conference. “If that date is not met, it will be a matter of major disappointment.”

Barrett said that in recent years made up some of the ground lost to the United States in terms of venture-capital and business-angel funding sources, even though these sources still take longer to approve funding than their counterparts.

Peter Grognard, founder of Septentrio of Belgium, a designer of navigation terminals that received venture capital to start the business, said European venture capital sources have proliferated but remain much more cautious than companies.

Grognard voiced concern that, in the complicated effort to finance the 3.4 billion euros needed to build the 30-satellite Galileo infrastructure, most of the European Commission funding earmarked for downstream services development has disappeared.

Grognard said Septentrio reported revenue of 20,000 euros in 2000 and 12.5 million euros in 2007. While now profitable, companies like Septentrio cannot spend long periods investing their own resources in Galileo applications without government support – especially since Galileo’s service introduction is still years away, he added.

The European Commission is scheduled to revise its financial spending plan in 2010, and officials said it may then decide to place funds in the Galileo services budget. Grognard said that for technology development, “the market opportunity is now. We can’t wait for the financial revision in 2010. Look at what Google is doing with new applications related to location-based services, and how fast these new applications are being introduced.”