The European Investment Bank (EIB), the EU's lending arm, announced its largest commercial loan ever on Monday, saying it would provide plane manufacturer Airbus with €3 billion ($3.4 billion) to boost the company's research and development efforts.

"This new financing — unprecedented in the EIB's history — aims to provide Airbus with not only the capacity but also the flexibility needed to invest in long-term research, development and innovation across both commercial aviation and the security and defense sectors," said EIB Vice President Ambroise Fayolle.

The loan comes as the European Union seeks to bolster its own manufacturing and defense efforts in the face of stiff US and Chinese competition.

Project shows 'Europe can move with speed and at scale'

A statement on the EIB website on Monday noted: "The financing will support Airbus' planned investments through 2030 in advanced technologies and integrated systems for commercial aviation, as well as security and defense systems. With specific investment projects located across France, Germany and Spain, it will augment Europe's aerospace and defense ecosystems."  

"The EIB Group is deploying its full firepower to bolster Europe's technological autonomy, industrial strength and economic competitiveness," said EIB President Nadia Calvino. 

Speaking in Brussels — while signing a contract for the transfer of the first €1 billion tranche — Calvino said the loan had been approved within six months of Airbus' request, "which shows that Europe can move with speed and at scale to support its champions and reinforce its position in the emerging geopolitical landscape." 

World's largest development bank and largest aircraft manufacturer joining forces

The EIB, which is headquartered in Luxembourg, is owned by the EU's member states and is responsible for the long-term financing of the bloc's institutions.

The EIB bills itself as the world's largest development bank and is tasked with helping the EU achieve its political aims.

Airbus, created in 1970, is a consortium of French, German and Spanish aerospace companies. These merged in 2000 to form the European Aeronautic Defense and Space Company (EADS), which maintains full ownership of Airbus. 

Airbus is the world's largest manufacturer of airplanes and helicopters, offering a wide range of commercial, corporate and military aircraft.

Headquartered in the Netherlands and France, the publicly traded company has assembly plants in France, Germany, Spain, Canada, China and the US.

Edited by: Roshni Majumdar