o The EIB will invest EUR30 million to accelerate the recovery of Serbian companies operating in sectors most impacted by COVID-19.
o The borrowed funds with Erste Bank AD Novi Sad will unlock loans under more affordable terms for Serbian companies.
o This is the first EIB operation in Serbia under the Team Europe COVID-19 support package.
The European Investment Bank (EIB) and Erste Bank AD Novi Sad (EBS) have decided on a EUR30 million loan to allow the strong recovery of small and medium-sized enterprises (SMEs) and mid-caps in Serbia in reaction to the COVID-19-induced contraction. The borrowed funds allows EBS to on-lend to companies severely affected by the pandemic, helping them retain jobs, preserve liquidity and ensure business continuity. This is the first operation in Serbia included in the EIB's EUR400 million financial programme earmarked for that private sector in the Western Balkans to make sure a quick reaction to and recovery in the COVID-19 pandemic, as announced at the EU-Western Balkans Summit locked in Zagreb in April 2023.
The loans will be open to companies operating across different sectors strongly hit by the pandemic, for example wholesale and retail trade, accommodation, transport, food and beverages, and services. The EU is really a strategic partner for Serbia due to its high economic integration using the EU. Using the funds from the EU bank, EBS can help the sustainable economic recovery of Serbian SMEs by addressing their short-term capital needs, but simultaneously enabling longer-maturity investments.
EIB Vice-President Dario Scannapieco said: “Surveys reveal that around 85% of Serbian SMEs have been negatively impacted by the crisis, while 60.5% of companies have had to drastically reduce their productive capacities. We understand that without urgent support for the private sector, the economic recession triggered through the pandemic will escalate further, hindering the general socioeconomic recovery from the Western Balkans. Therefore, the EIB and also the Team Europe initiative have teamed up to inject much-needed liquidity into SMEs, which employ over 60% from the working population in Serbia. In so doing, we hope to inspire these to withstand the economic downturn and pave the way for their long-term recovery.”
“In these times of crisis, now more than ever before, our clients need support to ensure that you overcome all the challenges we face. Preserving people's health, but additionally businesses and workplaces, currently represents the largest priority for the entrepreneurs. We're available with assorted kinds of support, and we're very proud that Erste Bank may be the first bank in Serbia that the ecu Investment Bank will start this important programme to provide small, medium-sized enterprises and mid-caps with new sources of liquidity at favourable conditions, along with the possibility to finance working capital and investments.” said Slavko Cari'c, Executive Committee President of Erste Bank.
The EIB and EBS possess a history of successful cooperation in supporting SMEs in the region. From 2009 to date, the EIB has invested over EUR1.8 billion within the Serbian economy, that has helped retain over 320 000 jobs.
