EBRD supports youth entrepreneurship
- By Amarjargal Munkhbat -
- Dec 18,2023
The European Bank for Reconstruction and Development (EBRD) is launching a seven-year 200 million EUR “Youth in Business Program” (YiB) to support the issue of youth entrepreneurship and employment in the Central Asia. It is designed to provide better access to finance and relevant training for young entrepreneurs in the Central Asia, where up to one third of the population is aged between 18 and 34 years old.
YiB will target micro, small and medium-sized enterprises (MSMEs) led or owned by young individuals under the age of 35. It will consist of up to 200 million EUR for on-lending to up to 20 partner financial institutions in the Central Asia including Mongolia. Small businesses eligible for non-financial services can participate in EBRD’s “Advice for Small Businesses” program to help develop their entrepreneurial skills through training, advisory services and networking opportunities. EBRD’s investment will be complemented by a package of up to 30 million EUR consisting of grants and concessional co-financing to stimulate inclusive lending and youth entrepreneurship.
At the launch event, Executive Director of Transcapital Z.Altanzul and EBRD’s Managing Director of Financial Institutions Francis Malige signed a loan agreement of up to 4 million USD. In addition, they participated in a discussion with banking and business representatives from Uzbekistan and Kyrgyzstan about the characteristics of young entrepreneurs, the problems they face, and increasing access to finance.
Transcapital NBFI has been working to support micro, small, and medium businesses since 2001, offering products, services and consulting that meet their needs. These initiatives are aimed at enhancing MSMEs’ capabilities, improving business performance and opening new growth opportunities. According to Transcapital, this partnership will provide a variety of non-financial services aimed at supporting the growth of young entrepreneurs and developing entrepreneurial skills and know-how. Loans to support young entrepreneurs will allow them to overcome the obstacles they face, such as insufficient collateral, credit history and lack of business experience.
A market assessment conducted by the EBRD in the region reveals that while many young people across Central Asia have a strong entrepreneurial mindset, very few have access to equal economic opportunities. Only around 10 percent of them have access to necessary training and professional expertise. This is very important for Central Asia, where MSMEs account for almost half of total employment and contribute to almost 40 percent of regional GDP. Grant support and concessional finance to the program is provided by the government of Kazakhstan, the Small Business Impact Fund, and the European Union. Currently, EBRD has invested and loaned close to 19 billion EUR through more than 1,000 projects.