EBRD Vice President for Policy and Partnerships, Pierre Heilbronn spoke to a panel on SME financial instruments in Trieste
More steps are needed to develop small and medium-sized enterprises (SMEs) in the Western Balkans, a senior European Bank for Reconstruction and Development (EBRD) official said on Wednesday, describing the sector as an engine for innovation in the region and a driver for economic growth.
At a summit of Western Balkan leaders in Trieste, Italy, EBRD Vice President for Policy and Partnerships, Pierre Heilbronn, also told a panel on SME financial instruments it was crucial to find mechanisms to support SME growth, including via improvements to their financial management and corporate governance – key components in becoming creditworthy bank customers.
The EBRD itself was putting a major focus on its SME activities, which combined the provision of finance with knowhow and advice, and driving forward its Women in Business programme that promotes women’s entrepreneurship and their role in the economy.
The Bank was also exploring ways to enhance vocational skills and youth inclusion through its work with SMEs across the region.
Mr Heilbronn referred specifically to the Western Balkan Enterprise Development and Innovation Facility, EDIF, an innovative platform uniting the European Union, International Financial Institutions, governments and donors. EDIF provides small businesses in the region with a comprehensive set of instruments to address their financing requirements.
“EDIF is a model for coordination … and we hope to see the continuation and further expansion of its role in the future,” the EBRD Vice President said.
Earlier on Wednesday, the EBRD signed a letter of intent demonstrating a determination to further support the implementation of the Western Balkans EDIF in the region. Other signatories were the World Bank, the European Commission and the European Investment Fund. Under this latest step, the EU intends to contribute an additional €48 million to the Facility with €15 million dedicated to the launch of the EBRD's regional SME Competitiveness Programme, which helps SMEs in the Western Balkans comply with EU and international standards and improve their competitiveness at home. Within the WB EDIF, the EBRD also manages the Enterprise Expansion Fund (ENEF), which provides otherwise scarce equity and mezzanine finance to the region.
Under its Small Business Initiative, the EBRD is providing over €1 billion in intermediated and direct financing a year to SMEs in its regions.
In the Western Balkans, the Bank has a portfolio of over €166 million, providing direct financing to smaller businesses, improving access to finance for SMEs through local financial institutions, risk sharing and engaging in business advice and policy dialogue.