Team Europe and EIB support SMEs impacted by COVID-19 in Brazil
Supporting private sector companies, especially SMEs as main drivers for jobs creation, is a major objective within the EU and its Member States. It is also an important part of its cooperation agenda with partner countries. Within the current pandemic context, it is even more important to assure a sustainable recovery of businesses and reduce as much as possible the negative socio-economic consequences derived from a slowdown of economic activity. Supporting during this difficult period means the survival of many small businesses, but above all it means maintaining jobs and income, and a better perspective at the time of recovery.
The European Investment Bank (EIB) and Banco Regional de Desenvolvimento do Extremo Sul (BRDE) announced targeted finance for small and medium enterprises (SMEs) in the States of Rio Grande do Sul, Santa Catarina and Paraná in Brazil, facing the COVID-19 pandemic.
The proposed emergency financing is part of the EIB contribution to the Team Europe response to the COVID-19 crisis, in close cooperation with the European Commission (EC).
The new agreement is an amendment to a contract signed in 2018, allowing both EIB and BRDE to provide flexibility and to widen the eligibility criteria of the current EUR 80M BRDE CLIMATE ACTION Framework Loan, in order to support lending to private sector business, at the onset of the Covid-19 crisis in Latin America, especially in Brazil. This flexibility will facilitate access to finance for micro-enterprises in the states of Rio Grande do Sul, Santa Catarina and Paraná. The amendment agreement will also give priority to climate action, which is in line with the current EU Green Deal approach.
Specific measures include:
- Supporting the use of solar power, small-scale hydropower and other renewable sources
- Promoting sustainable and inclusive economic growth by boosting productive investment
In the COVID-19 context, the EIB and BRDE partnership has been adapted to help respond to specific needs of SMEs in this new challenging situation, by allowing faster loan disbursements to businesses.