MOROCCO – Morocco’s Crédit Immobilier et Hôtelier, SA (CIH Bank) and the European Bank for Reconstruction and Development (EBRD) have signed a partnership to assist small and medium enterprises (SMEs).
Through the partnership, the two financial entities will commit €40 million (US$46.86 million) towards a financial facility that will provide loans to SMEs whose liquidity has been affected by the raging COVID-19 pandemic.
EBRD in a statement said that the facility is in line with EBRD’s and CIH’s commitment to strengthening the resilience of Moroccan small businesses and to alleviate the impact of the coronavirus pandemic.
Under this facility, the EBRD will provide a €20 million loan to CIH to provide as medium-term financing to private SMEs.
This will subsequently increase the availability of funding beyond the Greater Casablanca-Rabat region, where 70 per cent of the Moroccan economy is concentrated.
EBRD noted that the financing will contribute towards a swift recovery of the local economy, as well as strengthen its resilience in the medium and long term.
In addition to this financing, the EBRD is providing a €20 million trade finance line to help facilitate the export and import transactions of Moroccan businesses.
The partnership, the first signed between the EBRD and CIH, will support CIH in its strategic focus towards SMEs by increasing its lending capacity to this sector, EBRD further noted.
Small and large enterprises alike have suffered recession and economic crisis due to the COVID-19 pandemic.
Following the outbreak of the pandemic, enterprises across the country closed their doors as part of the preventive measures to contain the spread of COVID-19.
Morocco’s government launched a recovery plan after the lockdown measures eased but continues to promise firm restrictions if the number of COVID-19 cases continues to rise.
EBRD is among a number of financial institutions that have so far approved loans and funds to assist Morocco’s economic recovery.
To date, the EBRD (where Morocco is a founding member) has invested €2.4 billion in Morocco through 65 projects.
In April, the European bank granted a €145 million loan to Morocco’s BMCE Bank of Africa to support small- and medium-sized enterprises.