Georgia: EIB approves first tranche of loans to SMEs
The Georgian private sector will soon be able to benefit from lending recently approved by the European Investment Bank (EIB). The EIB loan will be used to provide access to finance for investment and working capital needs for small and medium-sized enterprises (SMEs) and midcaps, particularly in the areas of trade and commerce. This opportunity is highly relevant in the context of the EU-Georgia Association Agreement, which includes a Deep and Comprehensive Free Trade Agreement (AA/DCFTA), the EIB said on 27 May.
The EIB will be lending EUR 22.5 million – the first tranche of an approved loan of EUR 45 million – to a Georgia-based bank to finance SMEs and midcaps.
According to the EIB, its total lending commitments in Georgia amount to some EUR 820 million, including projects supporting urban reconstruction following last year’s devastating floods and for improving the country’s critical infrastructure. The EU Bank has also financed projects in Georgia in the transport, water and energy sectors. (EU Neighbourhood Info)
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‘Better and Safer Roads for Georgia’: Georgia launches nationwide road safety campaign with EU support
With the support of the European Union and the European Investment Bank (EIB), the Georgian authorities have launched a joint campaign – ‘Better and safer roads for Georgia’ – to raise awareness on road safety issues.
The campaign focuses on several concrete issues to raise awareness of the importance of road safety. It will show real stories of people affected by road accidents. Outdoor banners with road safety messages will be spread throughout five cities of Georgia – Tbilisi, Khashuri, Kutaisi, Zestafoni, and Batumi. This will be complemented by outreach through television, online media and social media. The goal is to reach as many drivers as possible and help them become aware of safety risks on the roads.
According to the EU Delegation to Georgia, car accidents are one of the main causes of fatalities and injuries in the country. Failure to maintain one lane, speeding and driving under the influence of alcohol are all significant causes of traffic accidents in Georgia. Over the past two years, 15,222 people have been injured in car accidents and 879 people have been killed, including 22 children.
“Systematically preventing deaths and serious injuries linked to road crashes is a priority of the EIB, the EU’s bank,” said Maciej Czura, the Head of the EIB Regional Representation for the South Caucasus. “Improving road infrastructure safety in Georgia has been one of our key priorities since 2007 when the bank began operating in the country. In order to achieve that, the EIB is supporting the Georgian East-West highway project with €1 billion financing guaranteed by the European Union, supplemented with up to €40 million of EU grants to Georgia.”
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EU-Georgia Association Council will take place on 6 September
The 7th meeting of the EU-Georgia Association Council will take place in Brussels on 6 September.
The meeting will be chaired by the Prime Minister of Georgia Irakli Garibashvili. EU High Representative Josep Borrell will lead the EU delegation.
The Association Council will discuss EU-Georgia relations against the background of Georgia’s application for EU membership, with a focus on political dialogue and reforms, economic and sectoral cooperation, trade and trade-related issues, as well as peaceful conflict resolution.
Representatives of the EU and Georgia will also exchange views on foreign and security policy, in particular on regional issues.
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The European Union public procurement market is now open to Georgian companies, following a decision adopted earlier by the EU-Georgia Association Council.
Georgian companies can view a complete and up-to-date list of public tenders announced by the 27 EU Member States on the Tenders Electronic Daily (TED) website. Every day, TED publishes more than 1,000 tenders in various sectors in electronic format. A single search interface allows businesses to find the tender they need based on criteria such as the nature of the contract and keywords.
“This is an achievement and a milestone in EU-Georgia economic relations and an important step towards the full implementation of the Deep and Comprehensive Free Trade Area (DCFTA) between Georgia and the EU,” the EU Delegation to Georgia said in a press release.
The decision also means that companies registered in the European Union have full access to public procurement tenders in Georgia. The central Georgian e-procurement system is open without restrictions to EU companies.
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EU annual report on Georgia: some progress in Association Agreement implementation and the need for further inclusive reforms
The European Union has published its annual Association Implementation Report on Georgia, which reviews Georgia’s progress in implementing reforms under the EU-Georgia Association Agreement over the past year. The publication comes ahead of the next EU-Georgia Association Council meeting scheduled for 6 September 2022.
“Georgia continued its reform path under difficult circumstances, against the background of its socio-economic recovery from COVID-19, a tense political environment and Russia’s war of aggression against Ukraine,” said the EU High Representative Josep Borrell. “However, we have seen setbacks in the key areas of rule of law, governance and human rights. As Georgia embarks on the new phase of its relations with the EU, with its European perspective, Georgia needs to take a responsible and conscientious approach that matches its stated objectives and its citizens’ aspirations.”
Key findings
A report prepared by the European External Action Service (EEAS) and the services of the European Commission shows that the EU-Georgia Association Agreement continues to be a driving force for reform. Overall, the process of aligning national legislation with EU legislation under the Association Agreement, including the Deep and Comprehensive Free Trade Area, is well underway and successful. Inclusive and green growth remains central to the EU-Georgia cooperation. In 2021, the EU continued assistance related to COVID-19 and contributed to a strong and sustainable socio-economic recovery, laying the groundwork for the implementation of the Eastern Partnership’s economic and investment plan.
“However, in 2021, challenges threatened to undermine the country’s democratic foundations and there were setbacks with regard to the rule of law. This demonstrates the need for a renewed and serious commitment to democratic consolidation, judicial reforms, and action to reduce political polarisation and to strengthen the rule of law and to guarantee a professional and pluralistic and independent media environment. These are essential priorities for Georgia to advance on its European path,” says a press release by the EEAS.
“The ball is now in Georgia’s court. A serious commitment to democratic consolidation, judicial reforms, strengthening the rule of law as well as fight against corruption and organised crime will be key,” said Olivér Várhelyi, Commissioner for Neighbourhood and Enlargement.
The EU-Georgia Association Agreement, which includes a Deep and Comprehensive Free Trade Area, was fully actioned on 1 July 2016. It deepens political ties, strengthens economic ties and respects shared values, and is the basis for EU-Georgian cooperation and EU support to reforms in Georgia.
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The European Investment Bank (EIB), the EU bank, is providing €1.59 billion, supported by guarantees from the EU budget, to help Ukraine repair the most essential damaged infrastructure and resume critically important projects addressing the urgent needs of Ukrainian people.
This is the second package of support for Ukraine under the EIB Ukraine solidarity urgent response developed in close cooperation with the European Commission. It follows an emergency support package of €668 million fully disbursed within a month of the war’s beginning. Like the first one, this new financing is offered at favourable terms including long tenors.
The package was agreed by the EIB Board of Directors yesterday; €1.05 billion will be made available immediately.
The financing will help essential services to resume and get the most critical infrastructure up and running again, strengthen the country’s resilience and maintain economic stability. It consists of two blocks of intervention:
- Immediate financial assistance totalling €1.05 billion. This will consist of upfront disbursements under eight existing finance contracts. It will help the Ukrainian government to cover priority short-term financing needs, provide support to strategic state-owned companies, ensure urgent repairs of damaged infrastructure, resume the provision of disrupted municipal services, and support urgent energy and energy efficiency measures in preparation for the cold season.
- Resuming implementation of EIB-financed projects in Ukraine totalling €540 million where possible, excluding areas of active hostilities and territories not controlled by the Ukrainian government. The selected projects will cover energy, energy efficiency, roads, transport, education and infrastructure, as well as reconstruction and recovery programmes. The exact timing of these disbursements will depend on the state of advancement of underlying projects.
Valdis Dombrovskis, European Commission Executive Vice-President for an Economy that Works for People, said: “This EIB support will keep strategic public sector companies financially viable and able to carry out urgent repairs of critical infrastructure, resume the provision of essential services and address other immediate needs of the Ukrainian people, including those displaced by Russia’s war. The European Commission will keep working with EU Member States and our international partners to support Ukraine on every level — for as long as it takes.”
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