Vienna/Luxembourg, 24 May 2012
EIB continues to support smaller projects in Eastern Partnership countries
The European Investment Bank (EIB) is providing a grant of up to EUR 4 million to ProCredit Holding’s subsidiaries in Georgia, Armenia and Moldova, consisting of interest subsidies for the final beneficiaries, as well as credit enhancement on the loans in question.
This grant builds on the EIB’s successful cooperation with the ProCredit group, which operates in the Eastern Partnership countries. In October last year, the EIB signed credit lines totalling EUR 50 million with ProCredit’s subsidiaries in Georgia, Armenia and Moldova to support smaller‑scale project financing in those countries. The ProCredit group consists of 21 growing banks operating in transition economies and developing countries in Eastern Europe, Latin America and Africa.
The EIB grant agreement of up to EUR 4 million with the ProCredit group was concluded under the Eastern Partnership SME Finance Facility, in the context of the EU-funded Neighbourhood Investment Facility. It will enable interest rates on loans to small and medium-sized enterprises to be subsidised. It is envisaged that the final beneficiaries of EIB loans will receive up to 10% of their loans interest-free. In addition, the 10% grant-funded loan will act as a funded-loss risk‑sharing cushion for the ProCredit subsidiaries.
The Grant Agreement for the Eastern Partnership SME Finance Facility was signed in Vienna today, on the occasion of the EIB Conference entitled “Eastern Partnership for Growth”. This Conference covers three main topics relevant for this area: regional economic prospects and priorities, local private sector development and infrastructure for economic development.
The EIB – the European Union’s bank – finances projects in Eastern Partnership countries (Ukraine, Moldova, Georgia, Armenia, Azerbaijan) and Russia on the basis of an EU Council and European Parliament EUR 3.8 billion mandate for the period 2007-2013. The current mandate provides for the financing of projects that contribute to (1) local private sector development, in particular support for SMEs; (2) the development of social and economic infrastructure; and (3) climate change mitigation and adaptation.
The EIB has also set up at its own risk the Eastern Partners Facility (EPF) for an amount of EUR 1.5 billion, with a ceiling of EUR 500 million for loans in Russia. This facility enables the EIB to provide loans to support investment-grade projects that sector-wise go beyond the scope of the mandate and helps to promote EU investment in the region, notably by European corporates.
Dušan Ondrejička, email@example.com, tel.: +352-4379-83334