SKOPJE, FORMER YUGOSLAV REPUBLIC OF MACEDONIA
, July 20, 1999 — The European Bank for Reconstruction and Development
(EBRD), the International Finance Corporation (IFC) and Germany's Deutsche
Investitions- und Entwicklungsgesellschaft mbH (DEG) have agreed to establish
the first equity fund in the Former Yugoslav Republic of Macedonia.
The fund comprises the first investment of its kind in the country, with
a focus exclusively on assisting small and medium-sized enterprises (SMEs).
The Small Enterprise Assistance Fund (SEAF) Macedonia LLC, a limited liability
company under Delaware (USA) law, will total US$13 million (€12.74 million).
US$4 million (€3.92 million) of this total has been committed by the
EBRD while the IFC and DEG are committing US$2.5 million each (€2.45
SEAF-Macedonia LLC will be managed by the Small Enterprise Assistance Funds
(SEAF), a Washington-based non-profit organization that manages funds established
to provide equity, quasi-equity and technical assistance to SMEs. The fund
will invest in companies with strong growth potential, which are locally
owned or soon to be privatized. Targeted sectors will include agribusiness,
food processing, tourism, light manufacturing industries and community
James D. Wolfensohn, President of the World Bank Group, who signed for
IFC, said "Through this IFC investment, the World Bank Group is supporting
the dynamic small and medium-sized enterprise sector in a challenging environment
at a difficult moment in the region's history. It reflects the World Bank's
unwavering support for the Balkans, and is part of our commitment to dedicate
significant time and effort to the rehabilitation of the region in its
post-conflict period. We also expect this project to encourage further
investment in both the country and the region as a whole."
"Promoting local small and medium-sized enterprises is vital to kick-start
the economic recovery not just of FYR Macedonia but of the Balkan region
as a whole," said Horst Köhler, President of the EBRD. "Small
and medium-sized businesses are the engine of economic recovery. But equity
for these businesses is hard to acquire in the country, especially in the
wake of the Kosovo crisis. This fund is a good step forward. As a joint
project with the IFC and DEG, today's agreement also demonstrates the value
of institutions working together as investors."
"With this participation, DEG is helping to revitalize the Macedonian
economy, a top priority particularly in view of the influx of refugees,"
said Andreas Zeisler, Senior Investment Manager of DEG.
The mission of the IFC, part of the World Bank Group, is to promote private
sector investment which will reduce poverty and improve people's lives
in developing countries. The IFC finances private sector investments in
the developing world, mobilizes capital in the international financial
markets, and provides technical assistance and advice to governments and
The EBRD was established in 1991 following the collapse of communism, to
aid the transition from centrally planned to market economies in central
and eastern Europe and the Commonwealth of Independent States (CIS). The
EBRD is owned by 60 shareholders: 58 countries, the European Investment
Bank and the European Community, and operates with €20 billion in authorized
capital. As at 30 June 1999, the EBRD had signed 108 projects, with a total
Bank commitment of €2.5 billion, in the six countries of the Balkan region:
Romania, Bulgaria, FYR Macedonia, Bosnia and Herzegovina, Albania and Croatia.