LONDON, ENGLAND — Together with the government of Albania, the European Bank for Reconstruction and Development (EBRD) is boosting the agricultural sector, a key part of the local economy, with the launch of the Albania Agribusiness Support Facility.

Under this new framework, the EBRD aims to enhance access to finance for local agribusinesses by providing dedicated credit lines to Albanian banks and microfinance institutions or by sharing with them the risk of lending to the agribusiness sector. The government of Albania is providing first-loss cover that will mitigate the risks of lending.

Agriculture is a vital sector of Albania’s economy. It provides employment for almost 50% of the population in rural areas and accounts for around 20% of the country’s GDP. However, the sector remains underserviced by financial institutions, with loans to agribusiness accounting for only 2% of total lending to the economy.

“Albania has great potential in agribusiness,” said Christoph Denk, head of the EBRD’s Albanian office. “But fragmentation, informality and limited access to finance stand in the way of realizing this potential. Together, with the Albanian authorities, we are delighted to launch the Albania Agribusiness Support Facility today. We are grateful to the government for their trust in the EBRD, and we look forward to working with all stakeholders to make this facility a success.”

The Albania Agribusiness Support Facility will address this challenge by enhancing access to finance across the country. The framework will also include technical assistance for capacity-building and training through the EBRD Small Business Support program.

The EBRD will continue to support the Albanian authorities with specific activities in favor of sectoral reform initiatives in coordination with other development partners.

“We are very proud to launch this ambitious and innovative program to boost support for Albanian agribusiness,” said Henry Russell, EBRD director for financial institutions, Western Balkans, Belarus, Moldova and Ukraine. “It will encourage local financial institutions to increase lending to farmers and agribusiness companies in Albania. By reducing risk it will also make the sector more attractive to investors.”

“The Albanian government has made development of the agricultural sector one of its main strategic priorities and is committed to supporting the sector through a number of reform initiatives and financial support,” said Shkelqim Cani, Albania’s Minister of Finance. “We believe that this new program will help us achieve this goal and strengthen the overall economy of Albania.”

Since the start of its operations in Albania, the EBRD has invested almost €1 billion in over 70 projects in various sectors of the country's economy, EBRD said.