EU Trade and Competitiveness Programme in Egypt, Jordan, Morocco and Tunisia
Small and medium-sized enterprises (SMEs) are widely recognised to be the engine for creating jobs and supporting economic development in the Southern Mediterranean. Improving access to finance for SMEs remains one of the key challenges hindering inclusive and long-term growth in the region.
The European Investment Bank (EIB) has joined forces with the European Commission under the Neighbourhood Investment Platform to develop the EU Trade and Competitiveness Programme with a primary focus on improving SMEs’ access to finance in Egypt, Jordan, Morocco and Tunisia.
The programme aims to increase the financing available to – and the competitiveness of - this crucial segment of the private sector in order to address key areas of vulnerability for businesses through:
- Enhancing access to finance, in the form of improved lending terms and conditions (especially reduced collateral requirements and/or lower financing costs), including in local currency; and
- Enabling the financial intermediaries to take on more risk and reach out to underserved segments of the economy.
Under the programme the EIB can provide local banks with the following:
- PARTIAL PORTFOLIO GUARANTEES to provide credit risk protection, on a portfolio basis, for the underlying debt financing (such as loans and/or leases to SMEs) granted by financial intermediaries. These are capped first loss portfolio guarantees provided by the EIB to the financial intermediaries that will then extend further financing directly to SMEs. The guarantee could cover losses of up to 80% on each defaulted loan incurred by the financial intermediary.
- LONG-TERM FUNDING to financial intermediaries committing to on-lend to eligible SMEs. Banks, national promotional banks or institutions, or any other financial institutions duly authorised to carry out lending activities can apply.
- CAPACITY BUILDING Technical assistance addressing different priority areas, including supporting SMEs in stimulating exports, enhancing competitiveness and modernising their businesses. The technical assistance will also facilitate the knowledge transfer of Best Banking Practices related to the processes set up for SMEs dedicated lending, including risk assessment tools to enhance outreach to underserved customers.
The European Commission and the EIB launched the programme* in 2021. The EIB is looking for partners in Egypt, Jordan, Morocco and Tunisia to start discussions about a future cooperation.
Banks and other financial intermediaries should express their interest to participate in the programme by writing to the EIB Operations Directorate:
In partnership with:
This is a non-binding announcement of the programme. Nothing contained therein shall be construed as creating any legal obligation neither for the European Commission nor for the EIB.