The European Investment Bank (EIB), the European Union’s development finance institution, has just signed with Banque Gabonaise de Développement (BGD) and Financial Bank Gabon (FBG) two finance contracts to provide EUR 7 million in FCFA equivalent for on-lending to private and public sector commercial operators, as well as microfinance institutions in Gabon.
The funds will be allocated on a “first come first serve” basis in a bid to encourage competition between the two participating banks, thus increasing the chances that EIB’s advantageous financing terms are passed to the final beneficiaries. To be eligible for EIB financing, potential projects will have to satisfy certain criteria, i.e., amongst others, require MLT financing with a term of minimum 3 and maximum 10 years, be financially sound, environmental friendly and socially responsible.
This is the third operation with BGD over the past 7 years. BGD has allocated EIB funds for the equivalent of EUR 6.7 million, primarily to projects promoted by local SMEs. As far as Financial Group, to which Financial Bank Gabon belongs, is concerned, cooperation with EIB has been successful in other African countries, but the current operation is the first with the group in Gabon. EIB's experience with both partners shows that they are particularly oriented at supporting SME’s and microfinance institutions. The two new operations should thus contribute to the favourable development of the economy of Gabon.
NOTE TO THE EDITOR
The EIB, established in 1958 by the Treaty of Rome, finances capital investment projects that further the European Union (EU) policy objectives.
It also participates in the implementation of the EU's co-operation policy towards third countries that have co-operation or association agreements with the Union.
Financing in Africa, the Caribbean and the Pacific (ACP) is carried out under the provisions of the Investment Facility, set up by the ACP-EU Partnership Agreement, signed in Cotonou in June 2000.The IF is established by successive protocols defining the aggregate amount of Community aid to the ACP States for each successive five-year financial period.For the first period (2003-2008) the Member Sates pledged EUR 2.0 billion. For the second period (2008-2013) the IF received a further EUR 1.1 and EUR 400 million was made available to provide technical assistance. Under the same protocol, that was signed in June 2006,the Member States supplied support for EUR 2 billion lending from the EIB’s own resources (was EUR 1.7 billion for 2003-2008).The Investment Facility is a revolving facility (loan amortizations will be invested in new operations), aiming at supportingtechnically, environmentally, financially and economically sound projects in the private or the commercially run public sector.