EIB and ProCredit to support faster recovery of Georgia`s SMEs from the COVID-19 crisis with €10 million

Published in Economics
Thursday, 24 December 2020 14:20

The European Investment Bank /EIB/ will provide €10 million to the ProCredit Group to offer a new credit line for small and medium enterprises (SMEs) and midcaps.

The EU bank and ProCredit create a €10 million credit line for the recovery of SMEs and midcaps from the COVID-19 pandemic in Georgia.
EIB and ProCredit Group agree on similar credit lines in Ukraine (€25 million) and Moldova (€20 million), bringing the total support to companies to €55 million.
The operation is part of the Team Europe’s COVID-19 emergency response to help sustain jobs, maintain liquidity and operations, and fuel the economic recovery of the EU partner countries.
The European Investment Bank, the lending arm of the European Union, will provide €10 million to the ProCredit Group to offer a new credit line for small and medium enterprises (SMEs) and midcaps in Georgia and support their faster recovery from the COVID-19 pandemic. The credit line can be made available in multiple currencies, including in the local currency.

The investment is a part of a €55 million regional agreement with the ProCredit, which allows creation of similar credit lines at ProCredit Group in Ukraine (€25 million) and Moldova (€20 million), all in support of faster economic COVID-19 recovery of the EU partner countries in the Eastern Neighbourhood.

This transaction provides much-needed financing to companies in Georgia to address working capital issues created by the ongoing pandemic. The EIB loan also strengthens the national banking sector in Georgia and reinforces its ability to finance the economic recovery of the country.

EIB Vice-President Teresa Czerwińska, who is in charge of operations in Georgia, Moldova and Ukraine, said: “Team Europe continues to support economic recovery of EU partner countries in the Eastern Neighbourhood from COVID-19, reinforcing pan-European solidarity in these difficult times. We have thus created new sources of financing at a moment when such aid is crucial for the survival of our SMEs. We look forward to expanding our partnership in the future, so as to allow even more companies benefit from our shared dedication to support SMEs and midcaps grow and develop.

EU Ambassador to Georgia Carl Hartzell said: The EU stands by Georgia during the pandemic. The EU has mobilised an unprecedented GEL 1.5 billion COVID-19 support package for Georgia, of which economic recovery of businesses is a fundamental part. This top-up by the EU bank strengthens this component by providing more assistance via local Georgian banks. Thanks to this agreement, an additional number of Georgian small and medium businesses will be able to access finance to get them through these challenging times.

The management of ProCredit Holding AG & Co. KGaA, the parent company of the ProCredit group, said:
“Thanks to the well-established relationships with our clients and partners such as the EIB, we have been able to provide efficient support to numerous SMEs during these turbulent months. These EIB credit lines will support SMEs in Georgia, Moldova and Ukraine to overcome short-term liquidity shortages and will provide much-needed support in local currencies for their investment projects. We expect that this will open them up to new lines of business and opportunities and thus will support economic recovery in the coming years. We are confident that this will be stimulated by a structural shift towards investments that are climate-friendly as well as socially and ecologically sustainable.”

Team Europe: Strengthening pan-European solidarity in times of crisis

The EIB investment is a part of Team Europe’s overall response to COVID-19 and supports the sustainable social and economic recovery of the EU’s Eastern Neighbourhood. The operation reinforces both SMEs and mid-caps, which are the backbone of national economies and a major source of employment in three countries.

Covered by guarantees from the European Union, the EIB investment enables the ProCredit Group to increase its lending activities without jeopardising the long-term stability of the local financial sectors or their ability to support the economic recovery from the pandemic in the long term.

The credit lines will be even more attractive due to the more flexible terms enabled by the EIB’s COVID-19 emergency measures. These emergency measures are a part of Team Europe’s efforts to support partner countries in the Eastern Neighbourhood during the pandemic.

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Team Europe - EIB and Bank of Georgia expand credit line for SMEs and mid-caps with €25 million to aid recovery from COVID-19 pandemic

Published in Economics
Wednesday, 16 December 2020 15:12
  • The EIB will top up its existing credit line at the Bank of Georgia €25 million to a total of €75 million to support the recovery of Georgian SMEs from the pandemic, extending coverage to include mid-caps.
  • The operation is part of the Team Europe’s COVID-19 emergency response to help sustain jobs, maintain liquidity and operations, and fuel the economic recovery of Georgia.
  • Since 2007, the EU bank has invested close to €2 billion in all key sectors of the Georgian economy, including connectivity, healthcare and SMEs.

The European Investment Bank (EIB), the lending arm of the European Union, will invest €25 million to expand a credit line for Georgian small and medium-sized enterprises (SMEs) and mid-caps available at the Bank of Georgia, helping to accelerate the recovery of the national economy from the COVID-19 pandemic. The credit line can be disbursed in multiple currencies, including in lari, Georgia’s national currency. 

The EIB loan will inject fresh capital into the national economy at a time when the COVID-19 pandemic is burdening SMEs with liquidity issues and restricting their ability to access finance and maintain daily operations or fund expansion plans. 

The investment from the EU bank will reinforce SMEs and mid-caps, which are the backbone of the Georgian economy and major employers in the country, and the country’s financial sector, boosting their ability to drive the economic recovery from the pandemic.

EIB Vice-President Teresa Czerwińska, who is in charge of operations in Georgia, said: As the bank of the European Union, we are proud to be bolstering Georgia and its economy in this hour of need, no matter how difficult the situation is. The EIB financing will support both Georgian SMEs and the country’s financial sector so that they can continue to operate despite the pandemic and drive the Georgian economy forward. This means we will save jobs, incomes and revenues. Together with our partners in the country’s public and private sector, we look forward to building a prosperous and sustainable future for Georgia.”

EU Ambassador to Georgia Carl Hartzell said: The EU stands by Georgia during the pandemic.  The EU has mobilised an unprecedented GEL 1.5 billion COVID-19 support package for Georgia, of which economic recovery of businesses is a fundamental part.  This top-up by the EU bank strengthens this component by providing more assistance via local Georgian banks. Thanks to this agreement, an additional number of Georgian small and medium businesses will be able to access finance to get them through these challenging times.

Bank of Georgia CEO Archil Gachechiladze commented: “I am very glad to see that our very successful partnership with the EIB is continuing. The multi-currency long-term facility gives us flexibility to utilise the funds according to the currency and maturity needs of our SME and mid-cap clients. Such facilities are key for the private sector, especially during these challenging times, and this further strengthens our position as a leading provider of long-term financial resources on the market. I would like to thank the EIB for its cooperation with us and look forward to many more successful deals in the future.”

Team Europe adds value for Georgian companies

Covered by a guarantee from the European Union, the loan from the EU bank will enable the Bank of Georgia to increase its lending activities without jeopardising the long-term stability of the country’s financial sector or its ability to support the economic recovery from the pandemic in the long term.

The credit line is even more attractive due to the more flexible terms enabled by the EIB’s COVID-19 emergency measures, extended as part of the Team Europe’s efforts to support partner countries such as Georgia during the pandemic.

This is the third operation between the EIB and the Bank of Georgia supporting the country’s SMEs and mid-caps. To date, the EU bank has invested more than €330 million in credit lines for Georgian SMEs and mid-caps, sustaining more than 54 000 jobs in the country.

Source: https://www.eib.org/en/press/all/2020-367-team-europe-eib-and-bank-of-georgia-expand-credit-line-for-smes-and-mid-caps-with-eur25-million-to-aid-recovery-from-covid-19-pandemic

Meeting with representatives of the European Investment Bank

Published in Economics
Friday, 09 December 2016 12:50

Minister of Regional Development and Infrastructure Zurab Alavidze met the representatives of the European Investment Bank. The meeting was attended by the First Deputy Minister Irakli Matkava, Deputy Minister Galaktion Buadze, Chairman of the Roads Department  George Seturidze and the Director of the United Water Supply Company  Giorgi Koberidze.  The sides  discussed the projects which are funded and supported by European Investment Bank.
As it was mentioned on the meeting, EIB will allocate funding package with amount EUR 450 million.  This amount will enable  implementation  a number of major infrastructure projects by the Ministry. The amount will increase the bank's portfolio in Georgia by 50%, which is an important message to evidence of a positive attitude of the Bank.

Meeting with the Vice President of the European Investment Bank

Published in Politics
Thursday, 15 September 2016 15:35

In terms of the economy and politics, Georgia is the most stable country in the region, - Vice President of the European Investment Bank (The EIB) Laszlo Baranyay noted during his meeting with the Prime Minister of Georgia Giorgi Kvirikashvili. According to Laszlo Baranyay the EIB intend to double its financial exposure in Georgia throughout the next few years.
Conversation during the meeting held at the Administration of the Government of Georgia touched upon the infrastructural projects funded by the EIB and prospects of cooperation.
The head of the Government presented the Government's four-point reform plan. Particular attention was paid to the ways of implementation of the infrastructural projects and the importance of the EIB support in this area was highlighted.
According to Laszlo Baranyay, the EIB actively support the reform course of the Government and plans on expanding cooperation.
"We discussed the ongoing issues with the Prime Minister. I believe that Georgian people are well aware of the active cooperation between the EIB and Georgia as well as with EIB's partnership with its economic representatives in both public and private sectors. As of today the amount of our investments is over 700 million EU, and we plan to increase this exposure in the coming 2-3 years. Our activities cover following economic and infrastructural areas, including support of SMEs and cooperation with several Georgian banks. Of course, we intend to intensify our activities, since your country has respective potential and relevant conditions. We discussed various methods of intensification of the cooperation, including in the area of education and social infrastructure. Our cooperation is very good and I hope that it will deepen in the near future," - stated the Vice President of the EIB after the meeting.

Georgia: EIB approves first tranche of loans to SMEs

Published in Economics
Monday, 30 May 2016 16:59

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)

Meeting with the President of the European Investment Bank

Published in Economics
Friday, 22 January 2016 11:35

The Prime Minister of Georgia and President of the European Investment Bank (the EIB) Werner Hoyer discussed progress of the infrastructural projects in Georgia financed by the EIB and the next stages of cooperation. Their meeting took place within the frames of Davos World Economic Forum.
As stated by the President of the Bank, Georgia enters in the list of three non-EU countries that implements operations of the EIB efficiently.
Pursuant to the head of the EIB, the Bank is still interested in execution of the projects, which will empower small and middle business in Georgia.
The amount of funds allocated by the EIB to Georgia equals 480 mln Euros in public sector and 165 mln Euros in private sector.

EIB supporting water sector rehabilitation programme in Georgia

Published in Economics
Monday, 19 October 2015 17:23

The European Investment Bank (EIB) is supporting waste water collection and treatment infrastructure in Kutaisi, Georgia, with loans of €100 million in the framework Georgia’s Water Sector Rehabilitation Programme.

The support will help to finance the rehabilitation and extension of the municipal sewerage system and the construction of a mechanical biological wastewater treatment plant.

EIB Vice-President László Baranyay, responsible for the Bank’s operations in Georgia commented: "Water and sanitary infrastructure is high on the EIB’s agenda in Georgia, in line with the government’s priorities," adding the EIB had already financed a number of projects in this sector across the country.

The total project cost, which addresses water supply and waste water investments in several municipalities in western Georgia, is €280 million, co-financed by the Asian Development Bank and with grants from the Neighbourhood Investment Facility (€4.75 million) and the Eastern Partnership Technical Assistance Trust Fund (€3.25 million).

15th FEMIP Conference to focus on innovation and entrepreneurship

Published in World
Wednesday, 14 October 2015 14:14

The European Investment Bank (EIB) is holding the 15th Conference of the Facility for Euro-Mediterranean Investment and Partnership (FEMIP) on the theme of “Innovation, Entrepreneurship and Jobs: Promoting Pioneering Investments in the Mediterranean Region.” The Conference will take place on 26 October in Luxembourg.

Discussions will focus on innovation and entrepreneurship in the private sector, providing a forum to explore financial instruments that support innovation and contribute to accelerating business growth.

For 2014-2020, the EIB has a mandate from the EU of close to €10 billion for the Mediterranean partner countries, complemented with up to €3 billion of other resources for the whole Neighbourhood region.

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