KfW Development Bank and the European Union sign an agreement of EURO 10 million
Ramallah, 26 January 2022. On the margins of the 3rd meeting of the EU-Palestine Investment Platform, KfW and the European Union, signed a EURO 10 million to support the European Palestinian Credit Guarantee Foundation (EPCGF) in extending loan guarantees up to USD 120 million supplemented with technical assistance to its partner banks and MFIs. The signatures took place at the Palestinian Prime Minister’s Office in Ramallah.
The mobilized financing will help the recovery of businesses hard-hit by the COVID-19 pandemic, broadening access to finance for MSMEs operating in areas as tourism, hospitality and agriculture. Specific amounts of financing will be made available to support underserved geographical regions, including Gaza, East Jerusalem and the Area C in the West Bank. The financing package will be channeled through tailored programs with certain credit conditions to the private sector through a number of partner banks and MFIs in Palestine. Technical assistance is a key pillar in this initiative to boost the capacity and resources of the financial institutions and final beneficiaries.
The Prime Minister of Palestine, Dr. Mohammad Shtayyeh, said: “The EU–Palestine Investment Platform has quickly become one of our main initiatives in support of the Palestinian SMEs, especially those affected by Covid19 in the West Bank, including Jerusalem and Gaza Strip. Today’s agreements demonstrate once again the EU solidarity with the Palestinian people which aim to empower the Palestinian economy and promote economic opportunities for business and young entrepreneurs.“
The European Union Representative, Sven Kühn von Burgsdorff, said: “Only one year ago we launched a new policy forum to better attract European investment in Palestine, the EU – Palestine Investment Platform. Today I am delighted to announce another package of Team Europe investments in support of the Palestinian private sector. This is a sign of trust in the viability of the Palestinian economy, demonstrating its resilience and ability to recover from the manifold recent crises, including the economic fallout of the COVID19 pandemic and the hostilities in Gaza. I trust that this package of financing will empower Palestine to build back better its economy, make it greener and more inclusive, paving the way to prosperity, welfare and a better quality of life for the Palestinian people. “
The Representative of the Federal Republic of Germany, Oliver Owcza, said: “I am delighted to witness the signing of the additional EU contribution to the “European Palestinian Credit Guarantee Foundation”. This support – that is complementing previous financing from Germany – is a showcase for the very successful cooperation between Germany, EU and the Palestinian side. It will further have substantial impact on the ground: Since EPCGF was established, it has issued MSME guarantees for loans worth of around 370M USD sustaining and creating around 35,000 jobs.”
The Managing Director of EPCGF, Raed Kafity, said: “Thjs agreement is a significant milestone in our ongoing collaboration and partnership with KfW and the European Union, both been supportive since our inception. With our collective efforts throughout the initiative, we will direct our focus and expertise on fostering the MSME sector in Palestine with a main focus on 'Gaza’, 'East Jerusalem’, 'Area C’ and the most impacted businesses as a result of the pandemic. Offering technical assistance to strengthen the financial infrastructure to banks and MFIs as well as other technical needs such as financial literacy to the final beneficiaries”.”