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Banks (Finance)

European Investment Bank and Palestine Investment Bank Join Forces to Enhance Access to Finance for Palestinian SMEs

Strategic Insights

— 1 min read

The European Investment Bank (EIB) and Palestine Investment Bank have collaborated to provide a USD 20 million line of credit to support Palestinian small and medium-sized enterprises (SMEs) hit by the Covid-19 pandemic. This initiative is part of the EU-EIB Economic Resilience Initiative (ERI), which aims to promote private sector development through support to SMEs. The funding is made available as part of a comprehensive package including technical assistance and a risk-sharing instrument to promote access to finance for SMEs, especially those impacted by the crisis.

Key Takeaways:

  • The EIB and Palestine Investment Bank partnership aims to provide vital financing to businesses and sustain jobs in the Palestinian economy during the Covid-19 crisis.
  • The partnership falls under the EU-EIB Economic Resilience Initiative (ERI), which seeks to promote private sector development through support to SMEs.
  • The EIB funding is part of a comprehensive package of EU economic assistance to support the Palestinian economy in its recovery from the pandemic.
  • The overall package of economic assistance amounts to around EUR 85 million, expected to mobilize over EUR 400 million in soft loans and investment for the Palestinian private sector.
  • SMEs are the backbone of the Palestinian economy, accounting for over 95% of local businesses, contributing more than 55% to the GDP, and employing 85% of the active working population.
  • The Covid-19 outbreak has led to a decrease in turnover and profitability for many companies, resulting in payment delays and an increased demand for liquidity.
  • The partnership aims to strengthen the Palestinian economy by contributing to economic independence, prosperity, and welfare.
  • The Palestine Investment Bank focuses on developing its SME line of business, directing its efforts toward this sector, which is considered the backbone of the national economy.

Statistics:

  • USD 20 million line of credit provided by the EIB to support Palestinian SMEs.
  • EUR 85 million of EU funds allocated to support the Palestinian economy in its recovery from the pandemic.
  • Over EUR 400 million in soft loans and investment expected to be mobilized by the EU package for the Palestinian private sector.
  • SMEs account for over 95% of local businesses in Palestine.
  • SMEs contribute more than 55% to the GDP in Palestine.
  • SMEs employ 85% of the active working population in Palestine.
  • The number of SMEs impacted by the Covid-19 crisis is not specified in the text.

Sources:

  • European Investment Bank (EIB)
  • Palestine Investment Bank
  • The European Union (EU)
  • The Palestinian Monetary Authority (PMA)
  • Contify.com

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