CEB finances high social added value projects in education, microfinance in Georgia
21 March 2016
PARIS - The Council of Europe Development Bank (CEB) approved two loans to Georgia in order to support the rehabilitation of state schools in Tbilisi and to facilitate access to financing for micro and small enterprises.
The first loan, worth €14 million, to the government, will be used for the comprehensive rehabilitation of schools, with emphasis on energy efficiency measures.
The aim of this project is to achieve through renovation and reconstruction considerable improvements in the energy efficiency and safety of more than 25 state schools in the Georgian capital. Around 15,000 pupils, including 300 children with a speech or hearing impairment, and their teachers will benefit from it.
Enhancing energy efficiency will help to reduce operational and maintenance costs and improve the sustainability of the renovated schools. It will also raise awareness about the benefits of the rehabilitation of public infrastructure.
In addition to the CEB funds, the project will benefit from a €6 million grant from the Eastern Europe Energy Efficiency and Environment Partnership (E5P), which will cover energy efficiency investments and related technical assistance.
This is the first project financed jointly with the E5P, which brings together international financial institutions, including the EIB and the EBRD, the European Commission, and other bilateral donors in order to coordinate and accelerate the implementation of important energy efficiency and environmental projects in Eastern European countries.
The second project approved by the CEB, worth €2.5 million, involves channelling financing to micro and small businesses in Georgia through Credo, one of the country’s leading microfinance institutions.
The aim is to support the creation and preservation of income-generating activities and self-employment as well as the development of micro-enterprises, particularly in rural areas. Credo will target small entrepreneurs in agriculture, tourism and trade, who have difficulty obtaining financing from commercial banks.
Given that the average loan size for small businesses in Georgia is well below USD 4,700, the CEB funds are expected to reach a large number of entrepreneurs and have a highly positive socio-economic impact on a vulnerable segment of the labour force.
Set up in 1956, the CEB (Council of Europe Development Bank) has 41 member states. Twenty-two Central, Eastern and South Eastern European countries, forming the Bank's target countries, are listed among the member states. As a major instrument of the policy of solidarity in Europe, the Bank finances social projects by making available resources raised in conditions reflecting the quality of its rating (Aa1 with Moody's, outlook stable, AA+ with Standard & Poor's, outlook stable and AA+ with Fitch Ratings, outlook stable). It thus grants loans to its member states, and to financial institutions and local authorities in its member states for the financing of projects in the social sector, in accordance with its Articles of Agreement.