The European Investment Bank and the ProCredit group have agreed on a new €65 million credit line to support small and medium enterprises in the Western Balkans and to speed their recovery from the COVID-19 crisis.
This transaction provides much-needed financing to companies in Serbia, Albania, North Macedonia and Bosnia & Herzegovina and addresses their working capital, liquidity and investment needs in the face of the ongoing pandemic. In parallel, the operation strengthens the regional banking sector and reinforces its ability to finance the economic recovery of the Western Balkans.
The European Investment Bank loan will help mitigate the economic shock caused by the COVID-19 pandemic, support companies, retain jobs and maintain small businesses across the region. 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 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. We are happy to have such reliable partners in the region such as ProCredit Bank. ”
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.”
The credit line will be available to SMEs at the ProCredit subsidiaries in Serbia, North Macedonia, Albania and Bosnia & Herzegovina. 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.