The European Bank for Reconstruction and Development (EBRD) is supporting the Palestinian economy with a US$7mn financing package for the West Bank’s The National Bank (TNB).
EBRD’s package consists of two facilities, including a US$5mn loan under the European Union-funded Green Economy Financing Facility (GEFF) Framework, as well as a US$2mn trade finance limit extension to TNB to “support Palestinian importers and exporters”.
The green financing will be on-lent to private sub-borrowers such as MSMEs and residential sub-borrowers in the West Bank for investments in small-scale renewable energy and sustainability projects, and to boost green technology supply chains.
The EU-EBRD Sustainable Growth4All Programme will support this facility with additional technical assistance to facilitate the implementation of the programme, as well as investment grants of up to 25% of the sub-project investment cost.
EBRD has also extended the trade finance limit to “support the trade finance business of TNB by issuing guarantees in favour of confirming banks” in efforts to bolster “the pre-export and post-import activities of local exporters and importers and the local distribution of imported goods”, according to the bank.
TNB is the second-largest Palestinian bank in terms of capital and one of the leading financial institutions operating in the West Bank, with 38 branches and offices.
EBRD managing director for financial institutions, Francis Malige, says: “Our collaboration with The National Bank will help promote sustainable energy and resource efficiency solutions for businesses and households in the West Bank.”
“This package underscores our shared commitment with the EU to advancing a greener private sector in the region.”
TNB’s CEO, Salameh Khalil, adds: “We are proud to be among the first Palestinian banks to partner with the EBRD under the Green Economy Financing Facility.
“This agreement marks an important step in our commitment to promoting sustainable finance and supporting businesses in their transition to greener practices.”
Since the start of its operations in the West Bank and Gaza in 2017, EBRD has approved 36 projects worth a total of €185.5mn. In 2024 alone, it provided €67mn of loans and investment, with a focus on developing small businesses in the West Bank through credit lines and trade facilities intermediated by local banks.
Last year, the European institution made its first equity investment in the region by acquiring a stake of up to 3.92% in the Bank of Palestine, as well as investing in the venture capital fund Ibtikar.
Most recently, it agreed a financing package of US$3mn (€2.9mn) to Palestine for Credit and Development – the largest microfinance institution in the West Bank and Gaza – after also lending US$5mn to microfinance institution Vitas Palestine.
Earlier in 2024, EBRD also increased a trade finance line for Quds Bank by US$3mn to a total of US$15mn in a bid to boost imports and exports in war-hit Palestine.
