IFC: in Georgia, access to financing is one of the main obstacles for business
Although Georgia’s banking sector is one of the most developed in the region, crediting from the banks’ side is still very limited and access to finances is one of the main obstacles for starting up a business –writes International Financial Corporation.
IFC states that this endangers enterprises, which want to participate to the growing economy of Georgia. In addition to that, IFC notes that despite the attempt to reduce dependence upon foreign currencies, access to financing in local currency is one of the challenges.
IFC is the first international financial organization, which expressed willingness to buy lari-denominated Eurobonds issued by the Bank of Georgia and became the owner of its 30%. IFC’s investment will make 103.3₾ ($45mln).
By doing so, IFC expects a possibility of long-term financing in local currency for small and medium businesses.
Financial corporation gives an example of one of the hotels, opened in Batumi, owner of which, in 2011, got a $500 000 loan, issued by the Bank of Georgia for small and medium businesses.
“Although tourism is one of the most fast growing sectors in Georgia, creating jobs, the difference between supply and demand for low-budget hotels is big”, - states IFC and notes in the report that number of tourists in Georgia has significantly grown since 2010 and has reached 6 000 000.