EBRD encourages global competitiveness of Georgia’s SMEs
Friday, September 23A new financial package by European Union (EU) is bringing new opportunities for small Georgian companies and supporting their operations abroad.
The European Bank for Reconstruction and Development (EBRD) allocated $50 million USD equivalent in the Georgian national currency Lari to the country’s national bank, Bank of Georgia.
The EBRD said the financial package will help local SMEs invest in improvements to product quality and modernise their services to meet EU standards. This in turn will create an environment that is beneficial to cross-border trade and economic growth in Georgia.
Georgia’s Economic Minister, Dimitry Kumsishvili, added that this financial package would "support developing our export opportunities and closer ties with Europe”.
Yesterday he addressed about 200 representatives of Georgia’s private sector who gathered at Tbilisi’s Technology Park to learn about the new EBRD support and how local businesses can access this assistance.
The financial package will give SMEs increased access to credit in Lari and will specifically support businesses that are managed or owned by female entrepreneurs for better access to finance, know-how and advice, said EBRD.
The Bank of Georgia will issue loans in Lari, with a tenor of up to five years and with a two-year grace period, while cash-back investment incentives of up to 15 percent will be available for SMEs. The first-loss risk cover will guarantee up to 10 percent of the loan portfolio of eligible SMEs.
International business experts will provide free technical advice for SMEs in Georgia, and the package will also include support for investment in new technologies and equipment.
“The EBRD is ready to help local SMEs become more competitive on regional markets with the provision of long-term local currency financing. We are grateful to the EU, our largest donor, for its continuing support for the implementation of such an important initiative," Bruno Balvanera, EBRD Director for the Caucasus, Moldova and Belarus said.
This action was taken by the EBRD to further support SME development in Georgia within the context of the Georgia-EU Association Agreement (AA) and inclusive Deep and Comprehensive Free Trade Area (DCFTA).
This was the first phase of the planned EBRD-EU program, in which the EBRD is working with local banks to help businesses invest in improving product quality and service standards.
The EBRD planned to establish similar cooperation with other banks in Georgia in the future. (agenda.ge)