BAKU, Azerbaijan, Jan. 21
By Tamilla Mammadova – Trend:
The European Bank for Reconstruction and Development (EBRD) responded to the coronavirus pandemic in Georgia with record investment in 2020, Trend reports via the EBRD.
Sixteen projects worth a total of 630 million euros were signed, helping to address the urgent needs of the country’s economy. The 2020 volume was double the Bank’s activities in the previous year.
The EBRD promoted economic resilience by supporting the development of local currency and capital markets. Together with the National Bank of Georgia, it worked to increase the availability of Georgian lari to private companies by setting up a US$ 200 million foreign-exchange swap facility, enabling the EBRD to secure reliable access to liquidity in local currency and continue lending to firms in lari.
The EBRD stepped up its investment to address immediate needs and to create the foundations for recovery, with a focus on building back better economies in the future. The Bank continued to concentrate its support on the private sector, which accounted for 79 percent of total EBRD investment in Georgia.
Keeping vital trade flows going, in Georgia alone the EBRD supported a new record of 70.3 million euros for trade finance transactions under its Trade Facilitation Program involving three local partner banks.
The EBRD further increased its support for small and medium-sized enterprises (SMEs) and the private sector with the provision of 135 million euros in loans to commercial banks for on-lending to local businesses for investments that will support recovery and strengthen competitiveness. This work included a project with a new partner in the non-banking financial institution sector, TBC Leasing, to diversify access to finance for micro and small businesses.
The EBRD supported the healthcare sector with a $25 million loan to Georgia Healthcare Group (GHG) to fund working-capital and operational-expenditure requirements for the group’s critical role in fighting the coronavirus pandemic in the country, enabling GHG to adapt six major hospitals for COVID-19 patients as well as enhance its diagnostic capacities.
In the infrastructure sector, under the EBRD Green Cities urban sustainability program, the Bank financed the modernization of the Tbilisi metro, continued supporting modern municipal infrastructure in the town of Bakuriani and ensured partial delivery of modern buses to the cities of Gori, Kutaisi, Poti, Rustavi, Telavi, and Zugdidi. As a first step, in 2020 118 out of a total of 175 buses were delivered and these will help to significantly upgrade public transport services in the regions and reduce emissions by 34 percent. In addition, Batumi, the second-largest city in Georgia, received eight electric buses for its municipal fleet.
The Bank also intensified its engagement in green energy with a major renewable-energy project to support Georgia in strengthening its transmission network. The EBRD provided 90 million euros of finance to Georgian State Electrosystem, a national electricity transmission company, to further develop the country’s high-voltage grid and ensure an uninterrupted supply of electricity to the population, especially in remote areas.
Furthermore, the EBRD continued to support regional connectivity and vital infrastructure with a 10 million euros loan to Georgian Air Navigation, the national provider of air traffic navigation and monitoring services.
The Bank also provided business advice to local SMEs by implementing 63 advisory and consultancy projects (with the assistance of 59 local consultants) and 4 international advisory activities to help companies improve their performance, grow and strengthen their activities to overcome the crisis.
Complementing its investments, the EBRD continued to actively engage in policy dialogue. The Bank played an important role in leading private and public-sector dialogue through the Investors Council platform. It also provided technical support enabling the government to realize its green agenda and to adopt key energy efficiency laws.
In addition, the EBRD continued efforts to enhance gender inclusion in its projects. The Tbilisi bus financing was a pilot project, with the EBRD introducing its new advisory services in terms of gender inclusion to create equal opportunities for men and women.
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