The EU’s financing programme for SMEs will help the Georgian entrepreneurs to move to the European standards under the Deep and Comprehensive Free Trade Agreement. The program, which is expected to be operational next year, envisages financial encourages in two main directions, such as to ease bank loans burden for business and to provide advisory assistance.
Roman Kakulia, the State Minister of Georgia for European and Euro-Atlantic Integration, states “Commersant” that the project aims to help new to bring their activities in line with the regulations under DCFTA as well as to maximally facilitate trading opportunities which exist today.
Kakulia says it means financing of interest rate subsidies on loans, as well as protection from exchange rate fluctuations and taking the risks that may be caused by the devaluation of the national currency.
As for the amount of loan subsidies, Kakulia notes that such details are not specified yet, however, it is possible it will be similar to the government program’s model, such as “Produce in Georgia” and cheap agro-credit program.
The criteria by which the companies will be selected are also unknown. In Kakulia’s words, the Ministry of Economic Development should work on this issue and agree the details with the European Commission that is expected to happen by the end of 2015.
Kakulia says the new program will support the small and medium enterprises, as under the DCFTA this is the most sensitive sector which development will be a priority.
There will be no restrictions for entrepreneurs, both agriculture and food processing industry will be involved in the programme.
Kakulia informs that a total of EUR 37 million will be allocated for the project in the years 2015-2017. The EU has allocated funds for this project for the associate member states Georgia, Moldova and Ukraine. Georgia will get 25% or Euro 37 million of this amount.
Roman Kakulia adds that the EBRD’s office is expected to be the principal actor in the program, which previously carried out consulting services within the framework of the EU programmes.
“The possibilities of the East Invest program which also was implemented by the Chamber of Commerce will be used to establish communication between the business operators”, – says Roman Kakulia.