EBRD and Cyprus join forces to support local SMEs - Cyprus Profile

Local
Articles | 03 March 2019

EBRD and Cyprus join forces to support local SMEs

The European Bank for Reconstruction and Development (EBRD), in collaboration with the Ministry of Energy, Commerce and Industry, is promoting a scheme to support small and medium-sized enterprises (SMEs) looking to increase their sales, reach new customers and improve efficiency of their operations.

The programme is co-funded by the European Regional Development Fund to give grants to SMEs based in the Republic of Cyprus, facilitating their access to consulting services, within the framework of the ‘Advice for Small Business’ (ASB) programme.

In May 2017, the Cyprus Ministry of Commerce (MECI) and EBRD announced the “Advice for Small Businesses” programme. Over the course of three years, the programme aims to support over 120 SMEs registered and operating in the Republic of Cyprus to improve competitiveness, strengthen performance, and drive growth.

The support provided is in the form of grants for the engagement of local consultants or international industry advisers, as well as in the form of training, networking opportunities and mentoring support. Another objective of the programme is the development of the local consultancy market by providing training to consulting companies, to improve the quality of business advisory services.

Those eligible for grants

Talking to the Financial Mirror, Anna Filipova, EBRD’s National Programme Manager for the Advice for Small Businesses (ASB) said that since May 2017, the EBRD approved grants for 56 companies to procure business advisory services delivered by local consultants and 19 of these projects were completed by the end of 2018. The average net project cost supported by the programme is €11,000 and the average grant amount is €7,000. The maximum amount of grant for one project is €10,000, but the maximum total amount of grants for one SME is €20,000.

Filipova said the programme includes various tools that have been designed to respond to different business needs SMEs might have.

“For each tool, there are specific eligibility criteria that need be met by SMEs in order for their application to be approved. For example, grants to procure business advisory services (which is a subject of the call for interest we announced) are provided to support existing SMEs (with more than 2 years of operation) that are financially healthy (accumulated losses, if any, should not exceed 50% of registered share capital). In contrast, coaching schemes (a combination of group training, individual coaching sessions and workshops) are designed to support new businesses (with less than 2 years of operation). For SMEs that fully meet the eligibility criteria the rejection rate is close to zero.”

Profile of the beneficiaries

According to Filipova, 27% of the current beneficiaries are micro SMEs (up to 10 employees), 45% are small SMEs (from 11 to 50 employees) and 28% are medium SMEs (from 51 to 250 employees). The beneficiaries are located across the whole territory of the Republic of Cyprus, but the majority is Nicosia-based (61%). Larnaca and Limassol-based beneficiaries are at 14% each.

The SMEs supported by the programme are operating in more than 10 different industries, including wholesale and retail trade (23%), food and beverages production (16%). The business advisory services which have been under high demand by Cypriot SMEs are; quality management (34%), strategy (18%), marketing (18%) and organizational design and HR (16%).

The consultants

“The EBRD database includes 77 pre-qualified Cypriot consultants, who can deliver business advisory services supported by the programme. Some 35 different consultants delivered business advisory projects from June 2017 until December 2018. On average, each consulting company is prequalified to deliver 2-4 different types of business advisory services, such as strategy, marketing, organizational design and HR, operations, ICT,” said Filipova.

Application process

With regards to the application process, EBRD’s ABS manager said that applicants need to complete a 3-page application form with general information about the company and its needs, submit legal certificates (certificate of incorporation, shareholders’ and directors’ certificates) and financial information for the last 2-3 years and complete a De Minimis form. “The review of the documents and the approval process, in general, takes 3 weeks maximum.”

New call for expression of interest

Recently the EBRD announced a call for expression of interest, which is an integral part of the programme and is targeted at co-financing the cost of business advisory services for 30 Cypriot SMEs. The business advisory services will be delivered by local consulting companies. The grants will be approved on a “first applied – first received” basis (provided that applicant’s eligibility and grant approval criteria are both met).

All different types of business advisory services are supported, such as strategy, marketing, organization, operations, ICT, quality management, energy efficiency etc. The deadline for the submission of applications is 8 March 2019.

Filipova says that EBRD’s overall engagement in Cyprus has so far been a success.

“From the start of our activities in mid-2014 to date, EBRD has provided more than €300 million, all in the private sector. The bank has supported banking sector recapitalizations, investments in green energy as well as physical infrastructure.

The demand for trade finance support in Cyprus, through our awarded Trade Facilitation Programme, reached another record year with the country being one of the most active among all of the countries where the EBRD operates.

The EBRD has an existing mandate in Cyprus until 2020. We have seen significant improvements in the Cypriot economy and are pleased that we have been able to play a role in the recovery.”

To learn more about ‘Advice for Small Businesses’ programme please call: +357 22 39 55 08 or email: knowhowcyprus@ebrd.com.

Source: Financial Mirror

Tags

Cooperation Partners