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Leasing is increasingly important for entrepreneurs in the EU accession countries, making it easier for them to acquire new equipment and services. To encourage these activities the EBRD is extending a €15mn loan to SIA Unilizings, the leasing subsidiary of Latvijas Unibanka, one of Latvia’s leading banks. The funds will enable more micro and small enterprises to undertake leases. The European Commission contributes €150,000 for technical cooperation and up to a further €1.9mn depending on the number of leases made by Unilizings.

The deal marks a continuation of close cooperation between the Unibanka Group and the EBRD. A €10mn credit line for small and medium-sized enterprises (SMEs) was signed in 2000, followed by a similar credit line in 2001.

Andris Berzins, president of Unibanka, says: “By signing a third agreement we prove ourselves as professional partners in using the financial assets of the European Union. We are also proceeding with special funding for micro and small businesses, this time offering leasing as a financial instrument, for which the demand in Latvia is on a steep rise. SIA Unilizings has gathered great experience in the local leasing market and will continue to support the growth of Latvia’s economy.”

The EBRD’s loan comes under the fourth extension of the EU/EBRD SME facility to support the development and growth of entrepreneurs by facilitating their access to finance. The bank has signed commitments of €525mn, of which approximately €420mn has been disbursed via 16,500 loans. Recent months have witnessed an upsurge in leasing in the accession countries. The EBRD sees the expansion of leasing activities as one of its priorities under its efforts to promote the development of SMEs.

Since its launch in 1999, the EC has committed €241mn to the SME facility under the Phare Programme, including €130mn of grant co-financing in cooperation with the EBRD. The Phare programme is one of the three pre-accession instruments financed by the EC to assist the candidate countries of central and eastern Europe in their preparations for joining the European Union.

Created to assist Poland and Hungary in 1989, today the Phare programme encompasses Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, the Slovak Republic, Slovenia and Romania, helping them through a period of massive economic restructuring and political change. In 2000-2006, Phare is providing some €11bn of co-financing for institution-building support. (For further information see: )