World Bank pledges €85 mln to support job creation, firms affected by pandemic in Georgia

About 6,000 micro, small and medium sized enterprises in Georgia impacted by the Covid-19 pandemic are to benefit from €85 million in financing support, approved today by the World Bank’s Board of Executive Directors. 

The new 'Relief and Recovery for Micro, Small and Medium Enterprises' (MSMEs) project aims to help businesses and create jobs by expanding and strengthening programmes that support MSMEs and by promoting digitalisation of Georgia’s economy.

The project aims at alleviating the financial constraints of firms and helping them adjust their business to a post-Covid-19 scenario. One component of the project will strengthen and expand MSME support programmes implemented by Enterprise Georgia (EG). The direct support for micro and small firms will come in the form of grants offered by EG’s micro and small entrepreneurship support programme.

Small and medium sized enterprises (SMEs), on the other hand, will be eligible for support through co-financing of interest payments under EG’s 'Produce in Georgia' programme, which will reduce their borrowing costs and address immediate liquidity constraints.

SMEs will also benefit from access to partial credit guarantees through financial institutions, which are designed to address high collateral requirements and heightened risk aversion of financial institutions. 

The project will also help strengthen the country’s financial infrastructure and increase the use of digital financial services; will also support the design and provision of technical assistance to firms to adjust to the new normal, via the adoption of relevant managerial, digital and other Covid-proofing practices.