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EBRD and EU to fund SMEs in Armenia

By Loretta  Martikian

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  • EBRD supports Armenia’s private sector in upgrading technologies to EU standards
  • Financing will help SMEs to invest in green technology
  • Loans complemented by technical advice and incentive grants from EU

The European Bank for Reconstruction and Development (EBRD) is providing a €5 million financial support package to Armeconombank in Armenia to facilitate the private sector’s transition to more sustainable, low-carbon and climate-resilient practices. The project is supported by the European Union (EU), with grant incentives allocated through Armeconombank.

The package is provided under the EU4Business-EBRD credit line, with incentives for on-lending to local small and medium-sized enterprises (SMEs) with export potential for investments in climate change mitigation and adaptation. It will also help SMEs to upgrade technologies and services to EU standards while promoting the use of green technologies. This is the fourth project to be signed in Armenia under the programme.

The EU4Business-EBRD credit line is a flagship initiative, helping local companies increase their competitiveness at home and abroad by upgrading their production facilities and processes to EU standards. The companies will be able to improve the working conditions of their employees and foster environmental sustainability. At least 70 per cent of the loan proceeds will be used to finance investments in green technologies in accordance with the EBRD’s Green Economy Transition (GET) approach. Borrowers are eligible to receive incentive grants and technical advice, both funded by the EU under its EU4Business initiative. The programme is also available in Georgia, Moldova and Ukraine.

Dimitri Gvindadze, EBRD Head of Armenia, said: “We are pleased to step up our support for SMEs in Armenia together with our long-standing partner Armeconombank. The funding aims to facilitate the competitiveness of local firms in Armenia by helping to invest in modern technology that will allow companies to strengthen their operations locally and take advantage of international trade opportunities.”

Ambassador Andrea Wiktorin, Head of Delegation of the EU to Armenia, said: “The EU is committed to supporting small businesses’ growth and sustainability. To this end, the EU4Business-EBRD facility supports SMEs with impact financing for green technologies. The overall contribution of the EU to the EU4Business-EBRD facility covering different Armenian banks is €6 million.”

The EBRD is a leading institutional investor in Armenia. The Bank has invested more than €1.66 billion through 195 projects in the country’s financial, corporate, infrastructure and energy sectors, with 91 per cent of those investments in the private sector.

About the EU

The member states of the EU 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 its values with countries and peoples beyond its borders.

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