You know the saying: give a man a fish, and he’ll be fed for a day, give him a multiple beneficiary intermediated loan, and he’ll be feeding others for a lifetime? Exactly - that’s what these loans do.

PP Orahovica is an agricultural company established in 1963 in eastern Croatia, between the river Drava and the lush Papuk mountain. This is where they grow hazelnuts, make Riesling, graze cows and breed carp, amongst other things.

The company had one 1000 hectare fish pond, and for transporting the fish – even for export, thousands of kilometres away, across the EU – they were transporting live fish, using special trucks outfitted with liquid oxygen and thermally insulated basins. “You deliver 10 tons of fish, along with 10 tons of water. After delivery, you’ve just lost 10 tons of fresh water,” president of their supervisory board, Marko Rašić says.

Besides the economic cost, there is also the environmental cost of towing around, in the end – useless, tons of pond water.

The company then won 4 other tenders from the state and increased their fish production to cover over 4500 hectares, and built a plant to process the fish, which means they don’t have to transport the fish live (unless a customer really wants that). “We can now deliver fish fillet, frozen fish, various different products, which means we are adding value to the fish,” Rašić says.

They received a EUR 1.4 million aid grant from the EU Instrument for Pre-Accession Assistance in Rural Development, and a 14-year, 4.4 million EUR loan from HBOR, the Croatian bank for reconstruction and development, owned 100% by the Republic of Croatia. HBOR is the intermediary that the EIB has been cooperating with over the past 16 years on various projects, the latest being the signing of a EUR 150 million extension of a loan to be passed on to mid-caps, such as PP Orahovica with its 1262 employees.

HBOR has always been trying to keep up with, or even be a step ahead of, the needs of our entrepreneurs in order to offer them as favourable terms and conditions of finance as possible and enable them to strengthen their competitiveness both in domestic and international markets, says Martina Jus, member of the managing board of HBOR. “These efforts of ours have been receiving strong support and understanding from the European Investment Bank.” 

“It was a very attractive offer, with low interest and a long repayment period. Due to the various regulations, approval takes time, but we knew this, and the benefits make it worth it,” says Rašić.

The attractiveness comes from the EIB passing its favourable borrowing terms on to the intermediary bank who will then pass it on to the final beneficiaries creating jobs and adding value to their products, says EIB deputy head of division for the public sector in Croatia, Slovenia and the Western Balkans, Jean-Marc Martin said. “We rely on partners such as HBOR who are able to work locally with relatively small firms to make sure the benefits reach the real economy as efficiently as possible.”

Altogether, over the years, EIB has financed HBOR with more than EUR 2 billion used to support SME’s and midcaps and the public sector in the areas of industry, tourism, and small and medium-scale infrastructure schemes promoted by local authorities.