The European Investment Bank and the Pro-Credit group have agreed on a EUR 65 million loan for small to medium size businesses in the Western Balkans.
The loans are specifically to help SMEs recover from the COVID-19 pandemic and to sustain ongoing growth. It will be available to businesses in Serbia, Albania, North Macedonia, Bosnia & Herzegovina. Funds will be used to inject needed liquidity, to mitigate bankruptcy and to make investments needed to further the operations of the business.
Parallel to this, the money will hopefully strengthen the local banking sector and reinforce the ability of banks to finance economic recovery.
The credit line is part of the European Commission’s €3.3 billion financial support package for the Western Balkans, out of which €1.7 billion from the EIB has been earmarked to support sustainable social and economic recovery in the region. The EIB loans towards the private sector follow Team Europe’s efforts to support the Western Balkans.
EIB Vice-President responsible for the Western Balkans, Lilyana Pavlova, said: “The COVID-19 impact is expected to be particularly harsh on SMEs, which account for about 73% of total employment in the Western Balkans. This operation comes at the right time to help the region alleviate economic recession, ensure employment and boost growth. As was previously the case, the EIB has once again expressed its firm support to advance the development of the private sector towards convergence with EU standards and the creation of a strong common regional market with increased competitiveness and job opportunities.”
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. This EIB credit line will help SMEs in the Western Balkans overcome short-term liquidity shortages and will provide support for their investment projects − while at the same time opening them up to new lines of business and opportunities.
We expect that economic recovery in the coming years will be stimulated by a structural shift towards investments that are climate-friendly as well as socially and ecologically sustainable.”
SMEs will be able to access the credit line via ProCredit subsidiaries in their country or operations. To date, the EIB has invested €4.1 billion in SMEs in the Western Balkans, which has helped sustain over half a million jobs in the region.
