ADB to provide $200m to help SMEs
Economic Relations Division (ERD) Secretary (In-charge) Kazi Shofiqul Azam and the ADB Country Director in Bangladesh Kazuhiko Higuchi inked the loan agreement on behalf of their respective sides at ERD in the city, said a press release.
“Developing SMEs is a key to accelerating growth, and reducing poverty, income inequality, and regional disparity,” said Kazuhiko Higuchi.
“This project will help small businesses and cottage industries in rural areas, especially those run by women, with better access to long-term capital. The project will also help women entrepreneurs develop skills to manage their enterprises more efficiently,” he added.
Bangladesh Bank General Manager Nurun Nahar signed the Second Small and Medium-Sized Enterprise Development Project agreement.
The project primarily focuses on small firms outside the metropolitan areas of Dhaka and Chittagong. At least 15 percent of assistance will be for women entrepreneurs. Priority will be on women engaged in subsistence trade and retail activities, who typically have limited access to finance.
The project includes $2 million in technical assistance from the Japan fund for poverty reduction to help establish incubation facilities with the aim to promote entrepreneurship.
This assistance will also help develop SME clusters that will boost access to long-term financing, and strengthen backward and forward linkages with the formal sector, particularly the export-driven industries.
The Bank and Financial Institutions Division of the Finance Ministry is the executing agency of the project, while the Bangladesh Bank and the SME Foundation are the implementing agencies.