New EU backing for European Fund for Southeast Europe to boost local currency lending

10-04-2019
Photo: EU4Business
Photo: EU4Business

The European Fund for Southeast Europe (EFSE) has announced the expansion of its fund structure to promote lending in local currencies.

Backed by a contribution of €44 million from the EU’s EU4Business initiative and €12 million from the German Federal Ministry of Economic Cooperation and Development, the new “L-shares” will be used to enhance local currency financing in the Eastern Neighbourhood region.

Complementing this endeavour was a simultaneous EU contribution of €5 million to the EFSE’s “C-share” class. The combined funding of €61 million will help the fund absorb exchange rate risks, ultimately protecting the EFSE’s target group of micro and small enterprises (MSEs) and low-income households from exchange rate fluctuations and contributing to sustainable economic growth in the region.

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Press release