WASHINGTON, September 20, 2012 — The World Bank Board of Executive Directors today approved an additional financing loan for the Croatia Export Finance Intermediation Project (CEFIL) in the amount of EURO 50 million (USD$61.41 million equivalent). The loan was granted to the Croatian Bank for Reconstruction and Development to continue supporting the private sector’s access to finance in an environment of constrained funding due to the impact of the eurozone crisis, and to further boost competitiveness, particularly among exporters, as Croatia moves towards EU membership.
The additional finance will help scale up the ongoing CEFIL Project (original amount of EURO 100 million) which has already achieved impressive results. So far, 58 exporting companies benefited from access to medium- and long-term finance. The funding helped them strengthen their long-term business opportunities and, more importantly, ride out the 2010 crisis. Exports of the supported companies, which account for five percent of overall exports of Croatia, grew by more than 30 percent. While the crisis has left many people jobless and the companies financed through the CEFIL were not immune, access to the project’s funds enabled most of the companies to preserve their current workforce and even create new jobs. Collectively, companies preserved the overall employment level.
The Croatian Bank of Reconstruction and Development will continue to make the project funds available to commercial banks, which, in turn, will on-lend to eligible private sector exporters.
“The global economic recession followed by the eurozone crisis has affected all economies in the region, including Croatia’s. Limited liquidity in global markets has meant restricted access to medium- and long-term financing for many private enterprises – which are an important engine for growth and job creation,” said Peter Harrold, Country Director for Central Europe and the Baltic Countries. “Through this additional loan, we continue helping the Government of Croatia’s efforts to stabilize the economy by offering long-term financing to exporters so they can continue to invest in their businesses and create jobs.”
Since joining the World Bank in 1993, Croatia received support from the global development institution in the form of financial and technical assistance, policy advice, and analytical services. To date, the Bank has supported 47 projects in the amount of US$3.3 billion, and it has approved 52 grants with a total value of US$70 million.