The European Investment Bank (EIB) and Montenegro have signed today in Podgorica a Guarantee Agreement covering Finance Contracts with Montenegrin banks for a total amount of up to EUR 100 million. This operation will support small and medium-sized enterprises (SMEs) and infrastructure projects promoted by local authorities. The EIB was represented by Dario Scannapieco, Vice-President responsible for operations in Italy, Malta and the Western Balkans, and Montenegro by Igor Luksic, Minister of Finance and Deputy Prime Minister.
The operation is intended to support small and medium-sized enterprises (SMEs) and industrial investment of any size in the fields of the knowledge economy, energy and environmental protection throughout the country in compliance with EIB eligibility criteria. A minimum of 70% of the loan amount will be allocated to SME projects.
Up to 100% of individual investment projects undertaken by SMEs may be financed from the EIB loans, while the EIB requires the banks to grow their total SME portfolio by double the amount of the EIB loan. Thus, some EUR 200 million should be invested in the SME sector in the next two years, during which the loans are to be implemented. Such a substantial influx of funding is expected to boost the economy and help the country navigate through the current difficult circumstances. The loans may also be used for financing projects undertaken by local authorities.
The present EIB operation, the largest to date in the country, is being mounted in responds to a request from the Montenegrin Government and comes at a time of international financial crisis marked by the scarcity of available funding in particular with regard to long-term loans for SMEs.
"We are very satisfied with the operation, which will reinforce the EIB's role in the region. This transaction, by its very size, will have a clear impact on the real economy of the country” remarked Mr Scannapieco. "We are also particularly pleased with the excellent relationship with Montenegro and its authorities, which was also evidenced by the rapid setting-up of this operation", he added.
Notes to editors:
The European Investment Bank (EIB), the long-term financing institution of the European Union, supports viable capital investment projects furthering the policy objectives of the Union. In the countries of the Western Balkans, the financing operations of the EIB contribute to facilitating the integration process with the European Union.
The EIB has been active in the Western Balkans for many years and to date it has financed projects totalling over EUR 3.7 billion in the region predominantly in the sectors of transport, environment, health and education, energy, and industry. Of total disbursements in the Western Balkans over the past eight years, 49% has gone to the transport sector, 12% to energy, 7% to health and education, 21% to intermediated loans to SMEs, 2% to industry and services and 3% to water and sanitation.