Mobiasbanca-Groupe Société Générale and the European Bank for Reconstruction and Development (EBRD) joined forces to help Moldovan private sector access the EU market. A joint program to help domestic small and medium-sized enterprises (SMEs) converge with EU standards was launched on December 8 so that companies can take full advantage of the opportunities offered by the Deep and Comprehensive Free Trade Area (DCFTA) between Moldova and the EU, IPN reports.
Under the agreement, the EBRD is extending a loan of €10 million to Mobiasbanca - Groupe Société Générale to support the development of local SMEs. The financing will be on-lent to the private sector to help local SMEs invest in improvements to product quality and modernize their services to meet EU standards.
The EU will provide interested SMEs with grant incentives of up to 15 per cent from the loan amount as well as technical assistance in the form of advisory services from international consultants and the EBRD’s Advice for Small Businesses program.
The signing marks the first transaction in Moldova under the EBRD-EU program under which the EBRD is working with local banks to help businesses further invest in improving product quality and service standards.
This is part of a larger program of the EBRD and the EU4Business initiative. In May 2016 the Bank started providing €380 million in loans and trade guarantees to local partner banks and other financial institutions for on-lending to businesses in Georgia, Moldova and Ukraine, while the EU is making available €19 million for technical assistance, investment incentives and risk-sharing.
Ridha Tekaia, President of the Management Board and CEO of Mobiasbanca, appreciated the sustainable cooperation established between Mobiasbanca and the EBRD, as well as the new opportunities offered to Mobiasbanca’s clients thanks to the EU support. “It is always an honor and a professional satisfaction to cooperate with the EBRD. Today’s signing of the agreement completes the range of opportunities for our customers who aim to improve their product quality and access new markets. We are glad to contribute, together with the EBRD, to local business development and the economic growth of the country,” he said.
Henry Russell, EBRD Director for Financial Institutions in Moldova, Ukraine, Belarus and the Western Balkans, said Mobiasbanca is their longstanding partner and has an excellent track record for on-lending EBRD finance to local companies to support their growth. “As the Deep and Comprehensive Free Trade Area with the EU is opening a major new market to Moldovan companies, we are partnering again to help local SMEs become more competitive on regional markets. The EU financing for this program represents very important support enabling companies to make the most of the new opportunities,” he stated.
Aneil Singh, head of the Operations Section of the EU Delegation to Moldova, said the signing of this first accord is a follow-up to the official launch on December 7 of the website EU4Business, which is an EU initiative that will integrate all the opportunities offered to the SMEs. “In this connection, I call on the SMEs to develop and cope with the challenges of the market. The economic growth and creation of jobs are an objective of the DCFTA, which offers a total of €200 million for grants and €2 billion for lending. This is the first lending agreement signed with a financial institution of the Republic of Moldova,” stated Aneil Singh.
A subsidiary of Groupe Société Générale SA, Mobiasbanca is Moldova’s fourth-largest commercial bank, serving over 130,000 active clients in the SME and retail sectors through a network of 54 branches.
The EBRD is the largest institutional investor in Moldova, with over €1.1 billion of cumulative investment in more than 110 projects in agribusiness, energy, the financial sector, infrastructure and manufacturing. The EBRD’s operations and policy dialogue in Moldova’s banking sector aim to improve transparency and governance in banks in order to enhance access to credit for SMEs in Moldova, including by increasing the number of banks that can benefit from the EBRD’s lending products and frameworks.
