The European Investment Bank (EIB) used the opportunity of signing new loans for SMEs totalling EUR 85 million on Friday, 19 September, to reiterate that the top priority for our activities in Cyprus remains providing affordable access to finance for SMEs. There were never any doubts as to where EIB funds are directed but a shared concern regarding the need to ensure full and swift utilization of funds which are just now becoming available.

The EIB benefits from a long-standing and constructive co-operation with local partner banks in Cyprus and used the meetings last week to explore opportunities with the Cypriot authorities and partner banks that will allow for a more efficient access by local companies to these funds. The issue is not where the money goes but how efficiently and rapidly we can provide finance for sound projects from SMEs. The beneficiaries of the funds are clearly identified, namely local SMEs and mid-cap companies. 

For the period 2009 - 2013, the EIB signed a total of EUR 228 million for on-lending to SMEs from which 692 SMEs have benefitted in a wide range of sectors, including tourism, manufacturing and services. As the Cypriot partner banks of the EIB match this amount with an equivalent amount from their own resources, a total of EUR 456 million has flowed into the Cypriot real economy.

Since the beginning of 2014, new SME credit lines totalling EUR 110 million have been made available to local partner banks. These new EIB loans include a dedicated window to tackle youth unemployment. The Cypriot government has been instrumental in making further additional lending possible through the provision of guarantees. It was agreed that all our efforts should be focused on a swift allocation and disbursement of these new lines. We are confident that this crucial step will be achieved rapidly, through identification of financially viable projects and continued strong cooperation between all parties.

The EIB has further developed in partnership with the Cypriot Government and local banks new, innovative products such as the Cyprus Entrepreneurship Fund or the Cyprus Trade Finance Facility. All these efforts are to contribute to a successful rebound of the Cypriot economy which is very much linked to the strength of its small businesses.