CEB to support job creation in Georgia
9 July 2019
PARIS - The Council of Europe Development Bank (CEB) has approved a €25 million loan to ProCredit Bank Georgia to provide a credit line to small and medium-sized enterprises (SMEs).
SMEs play an important role in Georgian economy, particularly in agriculture, trade and manufacturing. Almost half of the total workforce is currently employed in SMEs, which generate jobs in a country where the unemployment rate is higher than the European Union average. In recent years, the government has taken a number of measures to support the SME sector. Nevertheless, access to financing remains an issue for many small businesses.
The CEB loan to ProCredit Bank will be on-lent to Georgian SMEs to finance the acquisition of fixed assets, the construction or extension of business premises, and the provision of working capital. It is estimated that more than 300 SMEs will benefit from the funds in a variety of sectors, including retail trade, manufacturing, tourism and services.
By channelling financing to businesses, the CEB loan is expected to strengthen the competitiveness of SMEs, contribute to job creation and preservation, support the development of the private sector, and boost economic growth.
ProCredit Bank (PCB), which is part of the Procredit Group and has been operating in Georgia since 1999, is a leading bank in the financing of SMEs in the country. This is the second CEB loan to PCB Georgia, which has successfully implemented an SME-financing programme with funds provided by the CEB.
CEB Governor Rolf Wenzel said: “Unemployment rates remain high in parts of Europe, particularly among young people. Against this background, it is crucial to support small businesses and entrepreneurial activity as a means of creating new jobs. With this loan, hundreds of small Georgian businesses and local entrepreneurs with little or no access to financing can obtain the funds they need in order to develop or expand their own business.”
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 (AAA with Standard & Poor's, outlook stable, AA+ with Fitch Ratings, outlook stable and Aa1 with Moody's, 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.