Tbilisi 31 May 2012 - The 6th Annual Meeting of the European Fund for Southeast Europe (EFSE, the Fund) opened in Tbilisi today. The two-day event, co-hosted by the National Bank of Georgia, kicked off with a review of the EFSE’s achievements in 2011 and announcements of new loan agreements to boost the availability of financing to micro and small enterprises (MSEs) in the target regions of Southeast Europe  (SEE) and the European Eastern Neighbourhood Region  (ENR). Also on the agenda: the discussion of key findings of a survey the EFSE conducted among its stakeholders in SEE1 and ENR2 to the potential risks and medium-term market opportunities and capture views on the level of Responsible Finance practices in the various markets.

More than 300 international experts and local delegates from 30 countries are attending this year’s EFSE Annual Meeting, which was jointly opened by Nika Gilauri, Prime Minister of the Republic of Georgia, Philip Mikos, Head of Unit in Charge of the Regional Programmes for the Neighborhood East Region at the European Commission, Dirk Niebel, Minister of the German Federal Ministry for Economic Cooperation and Development (BMZ), and Giorgi Kadagidze, Governor of the National Bank of Georgia

“Today’s Conference is important for Georgia from the different perspectives: Georgia is currently on its development path and it’s crucial for us that EFSE – one more significant and development oriented institution will partner Georgian Banking Sector. The deficit of long-term financing impeded long term capital investments. Besides, the various high-risk sectors have law access to financing due to banks reluctance to portfolio diversification. In this regards, National bank of Georgia values EFSE’s approach towards contributing to development as it provides long term financing to its partner institutions, puts emphasis on local currency and SME Funding, supports agricultural sector.” – Stated Mr. Kadagidze

Review of 2011 shows a strong performance in an usually challenging environment with more than 300,000 subloans totalling EUR 1.8 billion since the EFSE’s inception in 2005. The Fund has made a major impact in terms of securing and generating employment throughout the target region – to date 315,000 jobs.
As in previous years, the Fund registered no investment defaults and the level of impairments has remained extremely low.

Current investors renewed their commitment and three new investors joined the Fund, increasing overall capital commitments to EUR 827 million – a development facilitated by the reform engaged in the beginning of the year to streamline the Fund’s shareholding structure. Private capital accounted for 63% of overall capital commitments.

In addition to providing funding, the EFSE remained committed to supporting its partner lending institutions through technical assistance and training.

Commenting on the EFSE’s performance, Monika Beck, Chairperson of the EFSE Board of Directors, said: “The EFSE closed the year standing on firmer foundations and strengthened in scope and resources. Our first EFSE stakeholder survey will yield deeper insights into perceived opportunities and risk in the Fund’s market. It will also identify Responsible Finance “white spots” and help us to better gauge the level of commitment of its principles. And finally, we started a major initiative to attract further funding, with an emphasis on private investors.”