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Business year 2011
31
Outside the EU
Turkey
– Two IPA initiatives (EUR 48.3m)
With GAGF, EIF catalysed EUR 500m worth of loans to
SMEs, including EUR 250m of EIB lending through five
local partners: Akbank, Denizbank, Halkbank, Vakibank
and Yapi Kredi, in addition to the support of the micro-
f inance act ivi t y of Kredi Garant i Fonu (KGF). The
EUR 150m portfolio supported consists of 2,700 SME
loans. EIF also began the implementation of the capacity
building component for KGF.
The second IPA project, signed in 2011, entails the sup-
port of a VC fund targeting the 43 regions in the most
disadvantaged areas of Turkey. The project named G43
Anatolia VC Fund is modelled on EIF’s previous experi -
ence with similar initiatives in other European regions.
Each of these cases illustrates how EIF works closely with
Member States and regions. Through this cooperation, the
needs of SMEs within the marketplace are better understood,
enabling the creation of specific portfolios of financial in-
struments that ensure the involvement of the private sector
through various multiplier effect mechanisms, achieving a
greater impact on SME financing volumes. In so doing, EIF
delivers significant added value by stimulating financing
activity even when market conditions are difficult, thereby
contributing towards offsetting cyclical declines.
New initiatives
EIF strives to expand the impact and influence of its re-
gional business development activity across the European
Union and beyond. For example, in 2011, EIF initiated
the creation of the Western Balkans Enterprise Develop-
ment and Innovation Facility (WB EDIF) alongside DG
Enlargement and the European Bank for Reconstruction
and Development, EBRD. This innovative SME financing
platform is currently being set up to deploy financial en-
gineering instruments (venture capital and guarantees)
providing greater levels of access to finance to this
underdeveloped region. This facility is expected to have
a significant impact in the Western Balkans, notably by:
■
Supporting innovation through early stage equity in-
vestments;
■
Providing access to finance for SMEs currently outside
the banking sector radar due their limited financial his-
tory, size etc;
■
Developing the VC ecosystem in the region and dis-
seminating best market practices regarding equity
investments;
■
Facilitating reforms in the legal framework in the region
when it comes to SME financing, through a dedicated
Technical Assistance pillar.
The WB EDIF initiative is fully in line with the Europe 2020
strategy aiming at smart, sustainable and inclusive growth
as well as with the Innovation Union and the Small Busi-
ness Act
13
. Importantly, within this initiative, the European
Commission, multiple International Financial Institutions
(IFIs) and beneficiary countries are joining forces and re-
sources for a common goal which is to develop a greater
level of private sector engagement in SME financing.
Similarly, EIF has proposed the creation of a dedicated
fund-of- funds vehicle to be called the ‘Nordic Innova-
tion Fund’ to be set up and funded in collaboration with
five Nordic governments. This initiative aims at delivering
much-needed equity investments to be made via select-
ed fund managers in high growth potential companies
across the Nordic region. The focus will be to explore
and expand the leading-edge developments that this re-
gion enjoys in the sectors of cleantech, life sciences and
ICT/mobile. The unique feature of this regional business
development proposal is the multi-country approach that
builds upon the collaborative foundations created by the
Nordic Council of Ministers. A similar initiative is also un-
der consideration for the Baltic region.
Discussions are taking place with the Cypriot authorities
for the development of a National Guarantee Fund for
SMEs.
Furthermore, regional business development activities
are playing a critical role in the deployment of EIF core
products since, with the proximity to the market that has
been achieved through local offices, origination efforts
are more targeted and efficient.
13
Adopted in June 2008, the Small Business Act for Europe (SBA) reflects the EC’s political will to recognise the central role of SMEs in the EU
economy and for the first time puts into place a comprehensive SME policy framework for the EU and its Member States.