- US$ 8 million to ArmswissBank for green lending and private sector development
- Financing will help SMEs invest in climate change mitigation and green technologies
- Loans complemented by technical advice and incentive grants from EU and GCF
Armenia’s private sector is set to benefit from new resources for green financing thanks to an US$ 8 million financial package put together by the European Bank for Reconstruction and Development (EBRD) in cooperation with the European Union (EU) and the Green Climate Fund (GCF). The funds will promote the private sector’s transition to more sustainable, low-carbon and climate-resilient practices.
The package is being provided to ArmswissBank under the EBRD’s Green Economy Financing Facility (GEFF) programme and the EU4Business-EBRD credit line with incentives for on-lending to small and medium-sized enterprises (SMEs) for investments in climate change mitigation and adaptation as well as for upgrading technologies and services to EU standards while promoting the use of green technologies. This is the second project to be signed in Armenia under the EU4Business-EBRD credit line, paving the way for more banking clients to join this new framework.
The EU4Business-EBRD credit line helps local companies improve their standards, upgrade production, improve employee working conditions and boost competitiveness on the local and international markets. At least 70 per cent of each loan will finance investments in green technologies. Borrowers are eligible for incentive grants and technical advice, both funded by the EU under its EU4Business initiative.
The EBRD’s GEFF programme supports businesses and homeowners wishing to invest in green technologies. Eligible projects include thermal insulation, photovoltaic solar panels, geothermal heat pumps and water-efficient irrigation systems. GEFF also includes a comprehensive package of technical advice which helps to identify and verify green investment opportunities. Businesses can find green technologies commonly available in Armenia using the GEFF Technology Selector.
The GCF will support the project with capacity building and implementation while providing incentive grants for eligible green projects.
Dimitri Gvindadze, EBRD Head of Armenia, said: “Strengthening the green economy with investments in renewables and energy efficiency is among the EBRD’s priorities in Armenia. We are glad that together with the EU and other donors we are contributing to a greener future for the country.”
Ambassador Andrea Wiktorin, Head of Delegation of the European Union to Armenia, said: “The EU is committed to supporting SMEs as key for green growth, jobs and building back better the Armenian economy. To this end, the EU4Business-EBRD credit line will support the competitiveness, acceleration and green transition of Armenian businesses.”
ArmswissBank is among Armenia’s leading banks. It operates in the corporate and investment banking sectors, offering traditional and innovative financial products.
The GEFF programme is helping to build a green economy in Armenia by supporting the expansion of green finance in accordance with the EBRD’s Green Economy Transition approach.
The EBRD is the leading institutional investor in Armenia. Since it started operations there in, the Bank has invested more than €1.56 billion in 191 projects in the country’s financial, corporate, infrastructure and energy sectors, with 88 per cent of those investments in the private sector.
About the European Union
The EU member states have decided to link together their know-how, resources and destinies. Together they have built a zone of stability, democracy and sustainable development while maintaining cultural diversity, tolerance and individual freedoms. The EU is committed to sharing its achievements and values with countries and peoples beyond its borders.
About the Green Climate Fund
Recognising the scale of investment necessary to limit global temperature rise to below 2 degrees Celsius, the Green Climate Fund was created to support developing countries in mitigating and adapting to the challenges posed by climate change. The EBRD and the GCF have been working together since 2017 to respond rapidly and effectively to these challenges for the benefit of millions of people.