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IFC and Georgia’s Basisbank Help Boost Access to Finance for Georgian Businesses

IFC, a member of the World Bank Group, has joined forces with Basisbank to boost access to working capital and trade finance for Georgia’s small and medium enterprises (SMEs), helping them expand their businesses, create jobs, and tap into new markets.

Access to finance is among the biggest challenges for doing business in Georgia, according to the World Economic Forum’s Global Competitiveness Index 2017-2018. To help address this, IFC is providing a $10 million loan to Basisbank, a subsidiary of the Hualing Group, one of China’s largest private enterprise groups, to enable it to on-lend trade-related working capital to Georgia’s exporters and importers. Basisbank has also signed on as an issuing bank in IFC’s Global Trade Finance Program (GTFP).

As part of the deal, IFC will provide the bank with a trade finance guarantee line of $2 million, helping it facilitate its clients’ trade transactions and boost cross-border trade. “The partnership will help us enhance our trade finance capacity, offer best solutions to our SME clients, and help grow their businesses globally,” said David Tsaava, General Director, Basisbank. “We are also delighted to join IFC’s Global Trade Finance Program, which will further strengthen our position in the trade finance segment and help expand our outreach to exporting and importing companies.” By supporting a smaller-sized bank, IFC is also expected to foster greater competition among Georgian banks.

“Access to trade finance is vital for businesses that depend on cross-border trade to remain viable and seek new opportunities for growth,” said Jan van Bilsen, IFC Regional Manager for the South Caucasus.

“Our cooperation with Basisbank is part of our wider efforts to support private sector growth in Georgia.” Georgia became an IFC member in 1995. Since then, IFC has committed around $1.83 billion in long-term financing, including nearly $940 million in mobilization, in 59 projects in financial services, agribusiness, manufacturing, and infrastructure. I

FC has also supported more than $385 million in trade through its trade finance program, and implemented advisory projects to help develop the private sector. The GTFP supports trade in emerging markets by providing partial or full guarantees for individual trade transactions. It has an international network of more than 500 bank partners in 150 countries, helping SMEs access the global trading system, and has supported more than $64 billion in trade in the last 13 years.