By Vanora Bennett
- EBRD supports Raiffeisen Bank Albania agribusiness loan portfolio of up to €35 million
- Raiffeisen becomes the 5th partner to join EBRD Albania Agribusiness Support Facility (AASF)
- Created in 2016, AASF enhances access to finance for agribusinesses
Raiffeisen Bank Albania and the Albania Agribusiness Support Facility are joining forces to increase local farmers’ and agribusiness companies’ access to finance, especially in remote regions of the country.
The EBRD, with the government of Albania, is supporting a portfolio of up to €35 million of eligible loans to the sector, risk-shared with its partner Raiffeisen Bank Albania. The instrument benefits from a First Loss Risk Cover contributed by the government of Albania.
Agribusiness is a vital sector of Albania’s economy. It provides employment for more than 50 per cent of the population in rural areas and accounts for around 20 per cent of the country’s GDP. However, the sector remains underserviced by financial institutions, with loans to agribusiness accounting for only 2 per cent of total lending to the economy.
Launched by the EBRD and the government of Albania in 2016, the Albania Agribusiness Support Facility (AASF) is addressing this challenge by improving access to finance for local agribusinesses through dedicated credit lines or by sharing the risk of lending to the agribusiness sector. Through this project, Raiffeisen Bank Albania becomes the fifth Albanian partner to join the AASF.
Matteo Colangeli, Head of EBRD Albania, pointed out the importance of the project, particularly at a time when Albanian agribusinesses need support from the banking system to maximise the absorption of EU grants for rural development under the recently launched IPARD program.
“We are delighted to have Raiffeisen Bank join forces with the EBRD and the government of Albania in the Albanian Agribusiness Support Facility,” he said. “This is also the first EBRD project with Raiffeisen in Albania and marks the start of a collaboration which we look forward to expanding in other areas.”
Elona Koci, Raiffeisen Bank Albania, Board Member for Corporate and Small Enterprise business, added: “We are happy to join the Albanian Agribusiness Support Facility and establish this new partnership. It is very important for Raiffeisen Bank to be part of this agreement, which will facilitate access to finance SMEs, operating in the agri-business sector. We see potential for development in this sector and believe that the support provided by the government and EBRD under this facility would generate significant added value in this sector. The loans will cover both investment and working capital needs, in order to meet SMEs’ needs, strengthen their competiveness and achieve their strategic objective.”
The EBRD has invested €1,287 million in 87 projects in Albania. The focus is on the sustainable development of the private sector, building on the strong entrepreneurial spirit in the economy, enhancing the commercialisation of infrastructure projects, and promoting sustainable energy and environmentally sound investments. In 2018, total EBRD investment in the Western Balkans region topped €1 billion.