December 14 (SeeNews) - The European Bank for Reconstruction and Development (EBRD) said on Thursday it released the second tranche of a 5 million euro ($5.9 million) loan to Albanian microfinance institution Fondi BESA aimed to support the country's agribusiness sector.
The loan is provided under the Albania Agribusiness Support Facility and it will be used for on-lending to eligible Albanian farmers and agribusinesses, the bank said in a statement, adding that the loan is complemented by a first loss cover provided by the government and technical assistance for capacity building.
In December 2016, EBRD together with Albanian government signed an agreement with Fondi BESA to provide it with a 5 million euro loan.
“The Albania Agribusiness Support Facility is addressing this challenge by improving access to finance for local agribusinesses through dedicated credit lines or by sharing the risk of lending to the agribusiness sector. Launched in 2016, the framework to date has attracted five partner financial institutions,” the statement writes.
Agribusiness is a vital sector of Albania’s economy. It provides employment for more than 50% of the population in rural areas and accounts for around 20% of the country’s GDP. However, the sector remains underserviced by financial institutions, with loans to agribusiness accounting for only 2% of total lending to the economy.
Fondi BESA has a network of 78 branches in the country and it is the largest microfinance institution in Albania.
($=0.8499 euro)