Access to finances major barrier to young entrepreneurs, EBRD pledges financial package of €9 million
Skopje, 23 November 2023 (MIA) - Entrepreneurs in North Macedonia continue to face barriers when it comes to accessing partnerships, acquiring new knowledge, and accessing new markets, hindering the potential for economic growth in the region, this was the message from the European Bank for Reconstruction and Development (EBRD) at their first event dedicated to promoting youth entrepreneurship with the support of the Youth in Business (YiB) programme, offering a financial package of €9 million to ProCredit Bank.
A €2 million loan under the EBRD’s flagship Youth in Business (YiB) programme is a first in North Macedonia and will support local micro, small and medium-sized enterprises (MSMEs) owned or managed by entrepreneurs under the age of 35, as well as €7 million EBRD loan under the Green Finance Facility (GFF) will be on-lent to local small and medium-sized enterprises (SMEs).
During the event, speeches were given by the ambassadors of Italy and Sweden, Andrea Silvestri and Ami Larsson Jain, along with the Vice Governor of the National Bank of the Republic of North Macedonia, Ana Mitreska.
Italy's Ambassador to the country, Silvestri, emphasized that the major hurdle for young entrepreneurs is the access to finances, as financial institutions perceive them as high-risk for funding.
“Young business owners and managers need additional support to realize their potential and contribute to stable economic growth. This support should be extended to the Western Balkan countries; otherwise, these shortcomings could serve as yet another driver for youth migration and brain drain,” Silvestri said, adding that young entrepreneurs, being more responsive to evolving economic opportunities and trends, can play a vital role in our economies.
Sweden’s Ambassador Ami Larsson Jain affirmed her country’s dedication to supporting the empowerment of the youth, acknowledging the transformative potential embedded in fostering an entrepreneurial spirit.
“Sweden is thrilled to be a hub for various innovative entrepreneurs and startups,” Larsson Jain said. She underscored some of the most prominent examples of this thriving culture of innovation, citing companies like 'Skype,' 'Spotify,' and the creators of 'Minecraft.'
"Studies highlight the unique challenges young people face in accessing finances," noted Ana Mitreska, Vice Governor of the National Bank, pointing out that new businesses, especially those led by young individuals, frequently find themselves excluded from traditional banking financing due to factors such as a lack of credit history, insufficient collateral, high transaction costs, and the absence of appropriate financial instruments."
In a discussion about the aspirations of young people and the current labor market conditions, Vice Governor Ana Mitreska highlighted that youth unemployment in Europe has seen a significant reduction from 20% to 11% over the past decade. However, in the Macedonian economy, the rate is also decreasing but remains significantly higher than that in the EU, standing at 25%.
Photo: MIA archive/ National Bank