The EBRD and Crédit Agricole Serbia are joining forces to increase the support for the country’s agricultural sector. Under the agreement local agribusinesses stand to benefit from a €20 million loan extended by the EBRD to facilitate access to funding and promote the use of warehouse receipts.
The facility is part of the EBRD’s €70 million risk sharing framework launched in July 2010 to finance the seasonal working capital needs of Serbian agricultural companies through participating partner banks. Using warehouse receipts as collateral is expected to demonstrate the viability of lending against agricultural commodities and thus alleviate crucial access to funding for viable enterprises.
Agriculture is one of the key sectors of the Serbian economy, accounting for more than 15 per cent of the country’s GDP. Serbia is also the largest grain producer in South Eastern Europe.
“Through this facility the EBRD is supporting the further implementation of the warehouse receipts programme in Serbia, helping to develop agricultural commodity financing in the country. This project will give a boost to the development of agribusiness in Serbia, enabling local companies to access funding for their growth”, said Hildegard Gacek, EBRD Director for Serbia.
“Crédit Agricole’s 120 year history in agribusiness financing provides its subsidiary in Serbia with the knowledge, experience and dedication to become a leader in this important, growing segment of Serbian market. With the new model of collateral based on the warehouse receipt, financing of our agro clients will be more favourable and thus more attractive”, added Marija Marić Mitrović, Head of Corporate and Agro Division at Crédit Agricole Srbija.
The implementation of the EBRD warehouse receipt system in Serbia is supported by considerable technical assistance grants provided by the EBRD’s Shareholder Special Fund, the UN’s Food and Agricultural Organisation and USAID for training of key government stakeholders, participating banks and warehouse staff as well as for the introduction of an electronic register for warehouse receipts.
Since the beginning of its activities in Serbia the EBRD has invested close to €2.5 billion in the various sectors of the country’s economy.
In the agribusiness sector alone, the EBRD has directly committed more than €6 billion in over 421 projects across Central and Eastern Europe and the Commonwealth of Independent States since 1991.