April 24 (SeeNews) - The European Bank for Reconstruction and Development (EBRD) said it is stepping up the support for its regions amidst the coronavirus pandemic, standing ready to provide 21 billion euro ($22.6 billion) in financing over the 2020-2021 period.
The lender plans to dedicate its entire activities to helping the 38 emerging economies where it invests to combat the economic impact of the crisis, after its shareholders agreed to a series of response and recovery measures to strengthen the bank’s Solidarity Package, the EBRD said in a statement on Thursday, announcing the new measures.
“The crisis is now so all‐encompassing that, in practice, it is expected that all of the Bank’s business over the next one to two years will contribute to the EBRD’s crisis response,” EBRD president Suma Chakrabarti said in the statement.
As part of the new measures, the bank is adapting and scaling up existing financial and policy support instruments and developing new ones, while also working to prepare the countries for the post-virus era.
The key pillar of the Solidarity Package is the Resilience Framework, which provides financing to meet the short-term liquidity and working capital needs of existing clients.
"Demand has been strong and, as part of the scaled up response, financing available under the Framework will rise to €4 billion from €1 billion until a further assessment of needs before the end of this year," the EBRD said, adding it has widened its scope to include the affiliates of existing clients.
In addition, the Bank is raising the financing under its Trade Facilitation Programme to meet the fast-rising demand for trade finance and keep open the channels of commerce under challenging circumstances.
It will also offer fast-track restructuring for distressed clients, as well as strengthen established frameworks to reach out specially to small and medium-sized enterprises (SMEs) and corporations that are not yet EBRD clients, the statement read.
The Solidarity Package will also offer a new emergency facility to meet essential infrastructure requirements.
"The emergency channels will target all sectors of the economy, but especially those badly hit by the crisis, including among others, financial institutions, SMEs, and corporate sectors such as tourism and hospitality, automotive and transport providers, agribusiness, and medical supplies," the EBRD said.
While in the current phase of the crisis the EBRD is focusing primarily on the rapid provision of debt to meet the needs of distressed companies, as the situation evolves, it will also ramp up its local currency, capital markets and equity offers.
"As the EBRD acts to protect the economies of its regions, it will also seek to safeguard transition, working to ensure an inclusive and gender-sensitive response to the crisis and to preserve commitments on transition to the green economy," the bank said.
($=0.929838 euro)