ZAGREB, Nov 20 (Hina) – The European Investment Bank (EIB) and the Croatian Bank for Reconstruction and Development (HBOR) have signed a new, €142.5 million loan agreement to support small and medium enterprises (SMEs) in Croatia, the two financial institutions said on Friday.
This is the second tranche of a package worth a total of €400 million. It is part of the EIB’s youth employment initiative under which companies that hire young people are granted loans under more favourable terms.
The initiative addresses the issue of youth unemployment as one of the biggest social and economic challenges faced by Croatia and Europe.
The loan is intended for SMEs requiring funds to maintain cash flow and jobs and for further investment to ensure faster recovery from the consequences of the coronavirus pandemic, HBOR Board President Tamara Perko said.
This agreement is yet another confirmation of our good cooperation with the EIB and will provide us with an additional source of affordable lending and make it possible for us to further lower interest rates on loans to businesses employing people of up to 30 years of age, she added.
EIB Vice-President Dario Scannapieco said that the EIB continued to support faster growth and development of the Croatian economy, this time through support for SMEs.
This is the second transaction signed since the outbreak of the coronavirus pandemic in March, providing a total of €240 million for favourable loans to Croatian SMEs and mid-caps, he said.
Last month the EIB and HBOR signed a €100 million credit line for Croatian SMEs and mid-caps affected by the COVID-19 crisis.
To date the EIB has supported the economic and social development of Croatia by investing €6.71 billion in the most important sectors of the national economy. Another key component of EIB activities in Croatia is support for SMEs and mid-caps through the creation of long-term financing options in cooperation with local financial institutions. To date the EIB has supported Croatian SMEs by unlocking new sources of finances worth close to €3.75 billion.