U.S. Introduces $20M Guarantee Program for Macedonia’s SMEs
For the first time, USAID has introduced two Development Credit Authority (DCA) Loan Portfolio Guarantees totalling US$20 million to support the expansion of small and medium enterprises (SME), energy efficiency, and other infrastructure projects in Macedonia’s municipalities. On September 17, 2007, USAID signed a partnership agreement with UNIBANKA and NLB Leasing to implement this guarantee program.
“The DCA Guarantee will play a prominent role in mobilizing private financing for various industries and for municipalities to trigger local economic growth,” said U.S. Ambassador to Moldova Gillian A. Milovanovic in her address to those gathered for the signing ceremony.
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| Macedonia’s Finance Minister, Trajko Slaveki, and U.S. Ambassador to Moldova, Gillian Milovanovic, at the signing ceremony for a partnership agreement for the implementation of two DCA Loan Portfolio Guaranees. |
The SME DCA facility is designed to provide access to working and investment capital for companies in various industries that want to expand their operations or market opportunities. USAID believes that this facility will help make Macedonian private sector firms more competitive on the domestic and global market.
The Energy Efficiency DCA facility is designed to provide funding for energy efficiency and other infrastructure development projects in municipalities. With Phase Two of decentralization, 42 municipalities have qualified and are now able to borrow from private financial institutions. In addition, energy service companies (ESCOs) have been formed and are in a strong position to implement energy efficiency projects on behalf of municipalities, especially those unable to borrow. USAID believes that this facility provides a foundation for establishing and developing strong and credible business relations between private-sector lenders and Macedonian municipalities.
“The Ministry of Finance fully supports this guarantee scheme and is of the position that such scheme is undertaken in a convenient period, when a large number of municipalities have already met the criteria to enter the second stage of the decentralization proces. By providing guarantees for borrowing by the municipalities, it will enable these municipalities to start building their positive credit history, as well as to build greater credit ability to finance their future needs,” said Macedonia’s Minister of Finance, Trajko Slaveski.
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