Implementation of World Bank Development Program Begins

YEREVAN (Noyan Tapan)The government of Armenia held a meeting with directors of private enterprises in order to offer implementation mechanisms of the $16.75 million credit program aimed at private enterprise development in Armenia. The credit agreement was signed by the Armenian government and the World Bank earlier this year.(WB).

"It’s time that government agencies turned from giving orders to offering advice and assistance," told Vahram Avanessian–Armenia’s Minister of Economy the more than 300 business professionals in attendance.

Deputy Economic Minister Armen Darbinian noted that this credit program was the first program specially designed for developing private sector. The World Bank sponsored program is aimed at allocating loans to private business through commercial banks.

The program is also designed to strengthen the private sector and banks in Armenia–by providing relevant investment funding and establishing foreign company contacts and networks.

The sum of loans is reported to be at $11 million–while volumes of separate credits will total up to $500,000–with their interest rates depending on the lending institutions. According to Darbinian–the inflation rate is not expected to exceed 10% this year. Primarily the credit will be allocated to registered private small and medium-sized enterprises operating in Armenia.

The Enterpise Promotion Fund was established within the framework of the World Bank program. Operating within this framework of the Enterprises Development and Investment Promotion Agency (EDIPA)–the Fund will extend up to $100,000 in credit to businesses involved in export.

An office of business consultations with a budget of $290,000 for costs and $750,000 for consulting is also planned to be established within the EDIPA.

Lend and Armimpexbank are the first two financial institutions chosen to participate in the implementation of the program.

Darbinian said the credit allocation is slated to begin in July 1997–while the implementation of auxiliary working programs will start in April.

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