Ukraine to receive 7.4 mln euros from KfW for concessional loans to SMEs

MOSCOW. July 26 (Interfax) - Ukraine will receive 7 million euros from the German Recovery Credit Institute (Kreditanstalt fur Wiederaufbau, KfW) for concessional loans, backed by a 4-million-euro grant, to small and medium-sized enterprises (SMEs) as part of the Refinancing of Energy-Efficient Investments of SMEs of Ukraine Through the Financial Sector project, the Ukrainian media said, citing Ukraine's Finance Ministry.

The loan agreement was signed on Monday by Ukrainian Finance Minister Serhiy Marchenko, Executive Director of Ukraine's Entrepreneurship Development Fund Andriy Hapon and Head of the KfW South East Europe and Turkey Department Klaus Mueller, the Finance Ministry said.

The project, funded by the German government, comes as a follow-up to the Support of SMEs joint KfW project, the implementation of which has made it possible to create a system of lending to Ukrainian SMEs in the national currency thanks to the European Union's financial assistance to compensate for losses due to the exchange rate difference and to finance SMEs for a total amount of over 1 billion hryvni.

The loan has been issued to the Ukrainian government for 30 years with a 10-year grace period.

The loan will be disbursed in the national currency by the Entrepreneurship Development Fund to SMEs via partner banks in an effort to maintain financial institutions' liquidity and to enable SMEs to invest in energy-efficient projects.

The loan and grant agreement as part of this project was signed under the Ukrainian-German December 17, 2020 intergovernmental agreement on financial cooperation (allocations over the 2012-2019 period), which was ratified on June 15, 2021.