eBusiness Weekly
Business Writer
The European Investment Bank (EIB) has pledged its continued support to Zimbabwe’s post Covid 19 economic recovery initiatives as it extended €25 million lines of credit to two local banks for productive sectors.
The bank yesterday signed an agreement with NMB Bank in Harare for €12,5 million while the other half was extended to First Capital Bank earlier this week.
Head of EIB Regional Representation for Southern Africa and Indian Ocean, Jim Hodges, said his bank was willing to provide the necessary support that can help drive economic growth by capacitating the private sector.
One of the big challenges faced by the country’s productive sectors is lack of access to funding. But Hodges said, this facility was an investment into the future of the country’s productive sectors.
“We have been engaging with banks in the past years and what we are now seeing is the result of that process. The EIB is committed to working with local financial partners to enhance access to finance by Zimbabwean entrepreneurs and businesses.
“Unlocking investment is crucial to enable business expansion and address economic challenges worsened by Covid-19. The bank is pleased to provide €12,5 million of new targeted financing to NMB that will strengthen private sector investment, create jobs and accelerate the post-pandemic recovery of Zimbabwe.
“Today’s new agreement demonstrates how Europe and African partners are joining forces to back business growth,” he said.
The EIB agreed on a cumulative €40 million facility for Zimbabwe’s private sector and CABS was the first bank to access it after signing a €15 million credit line last year.
Head of Agriculture, Private Sector and Trade, European Union Delegation to Zimbabwe, Bernard De Schrevel, highlighted more support would be available for the country’s private sector which plays a critical role in job creation, food security and access to export markets.
NMB chief executive, Gerald Gore, said the facility will target exporting companies of all sizes. Agriculture, mining and manufacturing are expected to benefit from the credit facility with a seven- year tenure.
“We want to capacitate our local companies that export. By doing so, they can become more competitive on both the regional and global markets.
“As a bank, we have been aggressive in funding agriculture in particular and this new facility from EIB complements these efforts. We are not just interested in lending to companies only, but looking at the impact on the economy, job creation, for instance,” he said.
Reserve Bank of Zimbabwe (RBZ) Governor Dr John Mangudya who was also at the signing ceremony, applauded the EIB for the credit lines extended to local banks as they will assist in economic growth allowing the country to meet the aspirations of the National Development Strategy (NDS1).
He added this will also help increase trade between Zimbabwe and Europe.
