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€20 million from the EBRD & EU for Polish small businesses
Entrepreneurs will require strong support as they face competition in enlarged Europe
The European Bank for Reconstruction and Development has extended €20 million
to Bank Zachodni WBK S.A. (BZWBK), Poland's fourth largest bank, to support
small and medium-sized enterprises in the country. The credit line is through
the EU/EBRD SME Finance Facility, a joint programme that promotes finance for
SMEs in the 10 eastern European countries that are candidates for accession to
the EU. As part of the program the EU is providing a substantial package of
incentives for staff training and other institution-building initiatives to
BZWBK, through a €3.2 million grant.
This is the first SME Facility operation by the EBRD and EU to BZWBK since the
merger last year of Polish banks Bank Zachodni and WBK. Both banks have
previously received support individually from the facility. WBK signed a loan
of €10 million in 1999 and Bank Zachodni €10 million in 2001. Together, the
banks have made 993 (end-December 2001) loans to SMEs in Poland. Under BZWBK,
over 440 branches and outlets are offering SME loans with the support of the
EBRD/EU facility and nearly 260 staff has been trained through the
EU-supported technical assistance program. The typical loan size is €24,811.
The EBRD has now contributed €100 million to SMEs in Poland. Alain Pilloux,
EBRD Business Group Director for Central Europe, said that SMEs in Poland will
compete in an increasingly open market with French, German and other European
companies, and therefore require strong support. They need a supportive
investment climate and local infrastructure, but in particular they need
access to reliable, long-term funding that can be accessed on market terms.
SMEs are an important engine for economic growth and help create jobs, which
is why we place in them such a high priority, he added.
The development of small and medium-sized companies in the accession countries
is one of the most important goals of the European Union. They are proven
engines for economic growth, accounting for more than 50 per cent of
employment in many countries,.
Declan Flynn, Member of Bank Zachodni WBK Management Board in charge of
Corporate and Commercial Banking said: "Particpation of our bank in this
initiative is not only a matter of prestige. We are very happy that we can
take part in building one of the most important sectors in the Polish market,
i.e. small and medium-sized enterprises, whose significance for the economy
and banking industry will be growing. Assistance with financing Polish
businesses with EBRD funds provides us with an excellent opportunity to
present to them our potential and offering."
The EU/EBRD SME Facility was launched on April 1999 by the EBRD and the EC
under its Phare Programme to encourage the growth and development of SMEs by
facilitating their access to loans, leasing and equity finance from local
financial intermediaries in the candidate countries.
The Phare Programme is the main channel for the EU's financial and technical
cooperation with the candidate countries of central and eastern Europe. The
Phare budget is about €1.5 billion a year, of which a third is devoted to
Poland (Phare 2000 - €484 million, Phare - €468,5 million) . From 2000 onwards
Poland is granted pre-accession aid of up to €1 billion (Phare ,ISPA, SAPARD).
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