GROW – New Credit Guarantee Window for Energy Investments Launched
Millennium Foundation Kosovo, Kosovo Credit Guarantee Fund (KCGF) and partners launched the new credit guarantee window GROW (Green Recovery and Opportunity Window) that aims to support businesses in Kosovo to invest in renewable energy and energy efficiency.
GROW, designed and financed by Millenium Foundation Kosovo (MFK) with the support of Millenium Challenge Corporation (MCC), is the second project phase, following the initial one of providing technical assistance for businesses, launched earlier this year. With the support of 6 million euros donated by the German government through KfW Development Bank, the new window will help financial institutions support sectors that in the past lacked access in financial opportunities, despite the fact that they can be promising for country’s economic growth.During the event, KCGF also signed an agreement with ProCredit Bank as the first financial partner to offer this kind of service to its clients. New cooperation with other financial institutions in Kosovo will follow.
“The energy crisis in Europe has thrown the ramifications of the lack of investment in energy generation in Kosovo into stark relief. The burden has become even greater for Kosovo’s economy. This guarantee window will help kickstart green generation and help businesses to take control of their own energy costs through self-generation and energy efficiency investments, improving resilience to current and future global shocks.” – said Sarah Olmstead, Country Director for MCC in Kosovo.
The Governor of the Central Bank of the Republic of Kosovo, Fehmi Mehmeti, said that “Now that GROW is launched, we expect for the credit portfolio to increase each day, especially from those promising sectors with lack of access to financial services in the past.”
The Kosovo Credit Guarantee Fund Director, Besnik Berisha, declared that: “The mission of KCGF is to increase SMEs’ access to finance. GROW will support the empowerment of investments in this direction, which is crucial for sustainable economic development and for increasing competitive skills of Kosovo businesses.
“GROW started with The Constraints Analysis that helped us understand how to enable green energy investments. TETRATECH and FMI International have created consulting services and outreach elements for a robust framework for the window, while KFW’s the capital and DFC’s counter guarantee have ensured an additional layer of security for the product. Throughout the process, for the last four years, MFK team has been patiently and diligently working with KCGF to ensure that all the boxes are ticked and all intentions are met! – added Petrit Selimi, MFK CEO.
“GROW – a real window of opportunities in Kosovo”, pointed out Vera Baumann, Head of Economic Cooperation and Development at the German Embassy. “As the interest of investors is rising, Kosovan companies will be opened up to many chances to cooperate with foreign investors in the future, now that this additional lending is opening.”
The KfW Director in Kosovo, René Eschemann, stated: “The energy crisis offers the opportunity to rethink the sources of energy – how can we reduce our energy consumption and carbon footprint, reduce energy dependency and turn towards green energy and efficiency solutions. The new guarantee facility of KCGF offers support for these green investments in Kosovo – for the benefit of the businesses, to accelerate the growth of the green technology sector in the country and for the good of our planet.”
GROW is also offering free technical assistance to businesses by assessing their needs and potential for investing in solar energy and energy efficiency. Through different training across Kosovo, over 100 companies have been informed about the technical and financial aspects of these investments.
GROW project is part of the program ‘Sustainable Energy Landscape’, implemented by the Millennium Foundation Kosovo (MFK). MFK is the accountable entity responsible for the implementation of the $49 million Threshold agreement, signed by the Republic of Kosovo and MCC in 2017. MFK’s mission statement calls for accelerating Kosovo’s transition to energy independence and good governance. The Kosovo Threshold Program addresses two key constraints to Kosovo’s economic growth: an unreliable supply of electricity; and real and perceived weakness in rule of law, government accountability and transparency.