EBRD to allocate EUR 30mln to SME development in Armenia

ArmInfo. As part of the EU4Business initiative the EU launched in Armenia in July 2021, the European Bank for Reconstruction and Development (EBRD) and Armenian  financial institutions signed EUR 30mln credit lines, Lilit Gharayan  Team Leader EU4Business- EBRD Credit Line Armenia, said at the forum  entitled "EU4Business-EBRD Credit Line in Armenia - Impact to date  and Way Ahead" on April 14.  

As of now, over 70 local micro, small and medium-sized sized  enterprises (MSMEs) have received loans to the amount of EUR 15mln by  means of the partner banks - Ameriabank, ACBA Bank, ACBA Leasing,  Armeconombank, ArmSwissbank, Inecobank. 

The production sector's share in the credit line is 49%, followed by  food industry (13%), health sector (9%), restaurants and hotels (5%),  services sector (4%), agricultural sector (4%), construction (2%),  transport (2%), etc., Ms Gharayan said. 

The programme enables Armenian MSMEs to increase their  competitiveness and capacity. The EU4Business-EBRD Credit Line in  Armenia helps companies to meet EU standards. They can export their  products to the EU markets and be more competitive on the local  market. 

Talking to reporters, Ms Andrea Wiktorin, Head of the EU Delegation  to Armenia, said that MSEs are the backbone of any healthy economy.  As part of the initiative, the EU is involving businesswomen as well,  assisting a transition to "green" economy. Much has yet to be done in  Armenia's SME sector, with the banking sector to be involved as well. 

The credit lines were intended for 89 investment programmes, with 20  of them being "green" ones. Ms Wiktorin voiced hope it will be the  first step in the EU's involvement in Armenia's SME sector. According  to her, 40% of the EU assistance to Armenia must be directed to the  development of "green" economy. The programme is being implemented  under the EU investment and economic plan, Ms Wiktorin said. 

George Akhalkatsi, Head of the EBRD Yerevan office, pointed out  growing interest in the credit line, with more sectors being  involved. He highlighted a need for appreciating the EU support for  the programme - both grants and technical assistance to SMEs. It is a  good example of how combined efforts can contribute to sustainable  "green" economy. As regards technologies, Mr Akhalkatsi stressed that  under the programme the EBRD highlights the importance of investments  in both renewable energy and energy-saving and technologies, which  saves both water and natural gas resources. In this context, he said  that the EBRD has instruments at its disposal enabling it to find out  individual companies' consumption, to help them invest in  technologies and reduce construction, with better environmental  protection. 

Work is being done to involve other Armenian financial institutions.  Mr Akhalkatsi hopes that the programme indicators will be doubled. 

The EBRD has invested over EUR 200bln in 200 projects in Armenia.  Since 2006, the EBRD investments in "green" economy projects have  totaled EUR 49bln.  

The EBRD forecasts 4% GDP growth in Armenia this year (against the  13.5% forecast for 2022), with a moderate acceleration to 4.8% in  2024. 

In 2022, Armenia's exports to the EU market totaled $772.7mln - a  17.8% 

According to Armenia's Ministry of Economy, the SMEs' share in  Armenia's GDP is around 27%. The ministry plans to bring this figure  up to 50%.