Brussels, 21/03/2012 (Agence Europe) - €1 billion from the European Regional Development Fund (ERDF) and the European Investment Bank (EIB) may be used as a guarantee for Greek SMEs and thus help to reabsorb their cash flow problems.
The European institutions are continuing their mobilisation to help put Greece back on track. European Commissioner Johannes Hahn, who is responsible for regional policy, was in Athens this Wednesday 21 March to outline the Commission's most recent financial montage. This is a mechanism set in place with the EIB, to be used as a guarantee fund for SMEs in Greece, which have suffered insurmountable problems of access to credit. The guarantee fund would therefore supply the Greek banks with the cash required, to help re-establish confidence. This guarantee fund would be made up of €500 million from the ERDF and, by means of a leverage effect, will help to unblock €1 billion in loans made by the EIB to SMEs; the banks would serve as the missing link in the virtuous circle it is hoped this will create. Hahn has high hopes for the success of the new mechanism, which comes on top of other financial instruments made available to Greece by the structural funds (95% co-funding rate). In Athens, he said that “the European Commission and the European Investment Bank have acted in great cooperation to find tailor-made solutions for Greece and secure small businesses funding. This is of crucial importance to turn the wheel around and get business off the ground in Greece.” (MD/transl.fl)