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Supporting small business in Belarus
EBRD launches framework with two signings
To support development of the private sector in Belarus and facilitate
entrepreneurs’ access to finance, the EBRD has launched a framework for micro,
small and medium-sized enterprises. The first two signings are a $6 million
loan to Belgazprombank and a $10 million credit line for Priorbank.
Micro and small enterprises have limited access to finance in Belarus today,
mostly via an existing EBRD credit line. Traditional microfinance providers
are non-existent and state-owned banks have fairly small appetite to work with
this type of consumers. The EBRD framework, worth up to $25 million, is
designed both to support the development of private banks and increase the
availability of finance for small business. Loans under the framework are
strictly for on-lending to private companies.
Mike Davey, EBRD Country Director for Belarus, said it is of paramount
importance to support the development of banks that have the potential to
become key providers of funding in the private sector. The programme will also
focus on expanding into less-populate regions of Belarus, where capital
constraints are even more acute than in the capital Minsk.
The new initiative builds on a successful previous credit line for Belarusian
micro, small and medium-sized companies, under which more than 1,360 companies
(including 1,272 small enterprises) were financed with a total of $72 million.
The EBRD’s activities in Belarus have been limited due to remaining concerns
about the pace of transition in the country. In its latest strategy for
Belarus the EBRD identifies the support of small enterprises as one of its
priorities. As of mid-2004 the Bank has signed projects worth €159 million in
Belarus.
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