EBRD supports real economy in Serbia

By Sergiy Grytsenko

The EBRD is boosting its support for the real economy in Serbia with a new investment to back Serbian companies in their drive to modernise and upgrade production.

A €10 million loan to Banca Intesa Beograd is destined for on-lending to local private companies. It is part of the EBRD’s wider regional facility to support the private sector in the Western Balkans.

The proceeds will be used to improve competitiveness among small and medium-sized enterprises (SMEs), which represent about 90 per cent of Serbian companies. Such companies will have access to medium and long-term financing, helping them overcome existing market barriers which continue to prevent enterprises from engaging in priority investments.

“With our new investment, we will urge many small and medium-sized companies to invest in enhancing their quality and productivity. We are providing much-needed access to finance, but we will also offer know-how and expertise in strengthening competitiveness – a crucial area for the country’s economy,” said Hildegard Gacek, the EBRD’s Director for Serbia.

According to Draginja Đurić, President of the Executive Board of Banca Intesa Beograd, over the past couple of years, the bank has been one of the most active banks in the field of subsidised loans to the corporate sector in Serbia.

The bank remains committed to fostering the local economy and promoting further market development. Since its establishment, Banca Intesa Beograd has disbursed a total of €1.16 billion in loans to private companies.

“Our collaboration with the EBRD enables us to expand our operations in this area and make an even greater contribution to this particular segment of the market by meeting its realistic needs through tailored financial products and services,” said Draginja Đurić at the loan agreement signing ceremony.

The competitiveness loans and incentive grants for best performance have been supported by technical cooperation funds provided by the European Union under the Instrument for Pre-Accession Assistance and by the Western Balkans Multi-donor Fund.

To-date the EBRD has committed around €2.5 billion in Serbia to more than 150 projects with a total value of some €6 billion. While supporting all sectors of the economy, the EBRD’s priorities in the country are the corporate and financial sectors and infrastructure.

The Western Balkans Private Sector Support Facility aims to provide economic market players in the region with the necessary financial and human resources, including technical skills, to offer competitive products and services and support them to face the challenges of the economic and financial crisis in the short and longer term.

The Facility comprises three independent windows: (i) the SME Competitiveness Support Window, under which this loan is provided, to support investments by SMEs to improve competitiveness and sustainability in preparation for EU accession; (ii) the Energy Efficiency Window to support sustainable energy investments; and (iii) the EBRD TAM/BAS Programme Window.