ADB may provide $76m to help support SMEs
Wednesday, 5 August 2009
FE Report
The anti-poverty lender Asian Development Bank (ADB) is likely to provide $76 million assistance to Bangladesh to support the country's major labour intensive sector --small and medium enterprises (SMEs), officials said Tuesday.
Finance ministry officials said the government would sit for negotiations with the Manila-based lending agency in the middle of this month to get the loan.
The proposed $76 million fund would be provided to the country's central bank for introducing a 'refinancing scheme' for the SMEs, a senior economic relations division (ERD) official told the FE.
"The central bank would lend the money to the local commercial banks and financial institution to disburse it to the country's promising small to medium-sized entrepreneurs," he said.
The ERD official said 15 per cent of the $76 million fund under the refinancing scheme would be provided to the women entrepreneurs aimed at promoting them as entrepreneurs.
He said it would be an important contribution of the Manila-based donor agency to the Bangladesh's economy, as it would facilitate the country's major employment generating sector SME.
Under the refinancing scheme, hundreds of thousands of small to medium scale industries of Bangladesh would get benefit to boost their business and make them competitive with other countries.
The loan under the refinancing scheme would be disbursed to the entrepreneurs within three years from September this year, the ERD official said.
"We are hopeful the negotiation, scheduled to be held in August 17-18 in Dhaka, would be completed successfully. After completing next formalities we expect the $76 million loan within next month," he said.
Bangladesh has thousands of small and medium sized industries where millions of people are employed.
The government visualises that the industrial sector, mostly SMEs, would be developing over the next decade and be able to gain 30-35 per cent share of gross domestic product and employing 35 per cent of the labour force.
In order to bring dynamism in this initiative, Bangladesh Bank (BB) has already created three funds with the seed money of Tk 10 billion to provide refinancing facilities against loans disbursed by the commercial banks and other financial institutions.
Already 19 banks and 23 non-banking institutions are receiving the refinancing facilities from the Bangladesh Bank.
The anti-poverty lender Asian Development Bank (ADB) is likely to provide $76 million assistance to Bangladesh to support the country's major labour intensive sector --small and medium enterprises (SMEs), officials said Tuesday.
Finance ministry officials said the government would sit for negotiations with the Manila-based lending agency in the middle of this month to get the loan.
The proposed $76 million fund would be provided to the country's central bank for introducing a 'refinancing scheme' for the SMEs, a senior economic relations division (ERD) official told the FE.
"The central bank would lend the money to the local commercial banks and financial institution to disburse it to the country's promising small to medium-sized entrepreneurs," he said.
The ERD official said 15 per cent of the $76 million fund under the refinancing scheme would be provided to the women entrepreneurs aimed at promoting them as entrepreneurs.
He said it would be an important contribution of the Manila-based donor agency to the Bangladesh's economy, as it would facilitate the country's major employment generating sector SME.
Under the refinancing scheme, hundreds of thousands of small to medium scale industries of Bangladesh would get benefit to boost their business and make them competitive with other countries.
The loan under the refinancing scheme would be disbursed to the entrepreneurs within three years from September this year, the ERD official said.
"We are hopeful the negotiation, scheduled to be held in August 17-18 in Dhaka, would be completed successfully. After completing next formalities we expect the $76 million loan within next month," he said.
Bangladesh has thousands of small and medium sized industries where millions of people are employed.
The government visualises that the industrial sector, mostly SMEs, would be developing over the next decade and be able to gain 30-35 per cent share of gross domestic product and employing 35 per cent of the labour force.
In order to bring dynamism in this initiative, Bangladesh Bank (BB) has already created three funds with the seed money of Tk 10 billion to provide refinancing facilities against loans disbursed by the commercial banks and other financial institutions.
Already 19 banks and 23 non-banking institutions are receiving the refinancing facilities from the Bangladesh Bank.