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EPCGF and KfW Join Forces to Launch €10 Million Program to Support Palestinian MSMEs
Ramallah, February 12, 2025, Germany through KfW Development Bank launched today a new EUR 10 million program to stimulate the Palestinian economy, in partnership with the Palestinian Ministry of Planning and International Cooperation (MOPIC) and the European Palestinian Credit Guarantee Foundation (EPCGF). The agreement was signed at MOPIC by Dr. Wael Zakout, Minister of MOPIC; Arne Gooss KfW Office Director – Palestinian Territories, Jan Wiegelmann, Team Leader, Caroline Ostendorf, Portfolio Manager, and Fida’ Abdel-Latif Senior Program Coordinator representing KfW; and Hussein Habbab – the Managing Director of EPCGF.
This new program builds on Germany’s longstanding support for Palestine, its economy and institutions, and its ongoing collaboration with EPCGF, a pioneering credit guarantee foundation with a long and credible track record of landmark achievements since 2005. This significant initiative, with its support directed mainly to Micro, Small, and Medium Enterprises (MSMEs), is projected to leverage EUR 10 million in funding to generate approximately EUR 50 million in financing through EPCGF’s partner financial institutions, benefiting an estimated 1,358 businesses and sustaining and creating approximately 10,450 jobs over the next four years. This vital support comes at a crucial time for the Palestinian economy, which continues to face significant challenges.
The program’s core objective is to support and strengthen the Palestinian economy by addressing both immediate and long-term needs. Working in close partnership with banks and MFIs, the program will provide crucial support to MSMEs, driving increased business activity for participating financial institutions. Also, a key element of this initiative is dedicated technical assistance, equipping these FIs with the knowledge and skills needed to effectively implement the program and serve the MSME sector.
EPCGF will implement the program through the following key components:
- Job Creation, Retention and Sustainability: A core objective of this program is to stimulate job retention and creation across all supported sectors and regions.
- Green Finance: Supporting renewable energy, energy efficiency, and climate-smart agriculture, impacting dozens of businesses. These initiatives will promote environmental sustainability while creating long-term economic opportunities, reducing dependency on external resources and enhancing energy security.
- Support for Women-Driven Businesses: Empowering women in ownership and management roles within businesses.
- Youth Empowerment: Fostering innovation and entrepreneurship among young entrepreneurs and the younger generation.
- Micro and Small Business Financing: Dedicated support for 1,086 micro and small businesses through microloans provided by banks and MFIs, directly supporting entrepreneurship and the growth of smaller-scale enterprises.
- Support for Impacted Sectors and Regions: Allocating funds to support businesses in economically and geographically challenged sectors, areas and locations.
This program represents a crucial investment in the future of Palestine. It provides much-needed resources for businesses, individuals, and financial institutions, supporting them to overcome and recover from the impact of economic hardships while building a foundation for long-term growth and sustainability. In these challenging times, this initiative offers a path to a more resilient and prosperous future for the Palestinian people.
