The EIB Board approved a new financing instrument for the first time for Greece. This instrument will allow the Bank to provide trade finance support to Greece for an amount of up to EUR 500 million.
President Hoyer said: “By setting up this programme, we have taken an exceptional step that will redynamise trade finance in Greece, enabling international trade by Greek companies at a time when international banks are retreating. This initiative is in addition to the EIB's EUR 900 million contribution to the Greek economy in 2012, which has benefitted investment in energy, transport and education as well as small businesses”.
The Bank, which is traditionally involved in providing long-term finance on favourable terms, is adding a short-term credit support instrument that will address the gap left by retreating commercial banks. The Bank will provide guarantees to the commercial banks for trade financing, and as these guarantees will be utilised on a revolving basis, they are expected to support a volume of transactions in the order of EUR 1.5 billion per year.
The EIB will play a critical role in mitigating the risk perception of the commercial banks that were no longer able to provide these services and will enable them to be resumed at a time when Greece needs trade finance in order to pursue export-led growth for its economic recovery.