MICROCAPITAL BRIEF: European Investment Bank Signs $25m in Financing Agreements with Banque Tuniso-Koweitienne, Tunisian Microfinance Institution (MFI) Taysir

The European Investment Bank (EIB), the Luxembourg-based long-term lending bank of the European Union (EU), recently approved two financing agreements with a total value of EUR 21 million (USD 25.2 million). The beneficiaries of the financing agreements are Banque Tuniso-Koweitienne (BTK), a financial institution founded by the governments of Tunisia and Kuwait, and Taysir, a microfinance institution (MFI) based in Tunisia. The aim of the agreements is to fund small-scale entrepreneurs and start-up ventures in the poorest areas of Tunisia. It is also expected that the funding will “contribute to the consolidation of Tunisia’s banking sector”[1].

BTK will receive EUR 20 million (USD 24 million) with 10 percent of the financing to be on-lent to microenterprises with preferential interest rates. The Tunis Entrepreneurship Network (TEN), an affiliate of the French Reseau Entreprendre that assists small businesses in Tunisia, will select candidates for the funding that comply with a “transparency charter”[1]. Taysir will receive a subordinated loan of EUR 1 million (USD 1.2 million), which will be on-lent to small-scale farmers, stockbreeders, young entrepreneurs and recent college graduates who wish to establish small business ventures.

Mr Werner Hoyer, the president of EIB, said that “this new finance for micro-enterprises is vital for Tunisia as it will have a crucial effect in terms of support for business and jobs”[1]. He added that “support for the private sector is a priority for the EIB in Europe and the Mediterranean region”[1]. Mr Philippe de Fontaine Vive, vice president of EIB, said that “supporting Tunisia’s economic transition is first and foremost a responsible, innovative investment centred on the economic and social priorities of this country. I am also delighted that civil society is associated with us in supporting small and microenterprises. The younger generations’ future depends on this”[1].

Since the democratic uprising in Tunisia in 2011, EIB has committed financing in total value of EUR 1.15 billion (USD 1.4 billion) for the implementation of projects in the energy, infrastructure, education and social housing sectors as well as to fund small and medium-sized enterprises (SMEs) in the country. The total lending portfolio of EIB was EUR 71.7 billion (USD 95.8 billion) as of 2013. Further information on BTK, Taysir and TEN is available in French on the websites of each organization.

By Alíz Crowley, Research Associate

About European Investment Bank (EIB)

The European Investment Bank (EIB) was created in 1958 and serves as the long-term lending bank of the European Union as of 2014. In addition to supporting projects in EU member states, its main priorities include financing investments in likely future member states and EU partner countries, principally in the area of small and medium-sized enterprises. According to its website, “the EIB operates on a non-profit maximizing basis and lends at close to the cost of borrowing.” The total lending portfolio of EIB was EUR 71.7 billion (USD 95.8 billion) as of 2013.

About Banque Tuniso-Koweitienne [Tunisian-Kuwaiti Bank] (BTK)

The Banque Tuniso-Koweitienne is a financial services company based in Tunis, Tunisia. The organization, which was formerly known as Tunisian Kuwaiti Development Bank, was founded in 1981 based on a bilateral agreement between the governments of Tunisia and Kuwait. In addition to a range of financial services, the bank and its subsidiaries also offer real estate and tourism services. As of 2014, BTK has 27 branches and approximately 370 employees. BTK’s shareholders include BPCE (Banque Populaire and Caisse d’Epargne) International et Outre-mer (60 percent), the Tunisian government (20 percent) and the Kuwait Investment Authority (20 percent). Further information on BTK is available on the organization’s website in French.

About Taysir

In 2011, Taysir became the first microfinance institution approved by Tunisia’s Ministry of Finance. Taysir specializes in the funding of microenterprises, small-scale farmers, stockbreeders, young entrepreneurs and recent college graduates who wish to set up small business ventures. Taysir also offers professional advice to its clients through its 13 branches in Tunis as well as in the Kef, Siliana and Beni Khalled regions of the country. As of 2014, the organization has received funding and donations from the European Investment Bank, the French Development Agency and the governments of Monaco and Qatar. Taysir also cooperates with Danone, a French multinational corporation, to lend to dairy farmers. Financial information on Taysir is available on the organization’s website in French.

About Tunis Entrepreneurship Network (TEN)

The Tunis Entrepreneurship Network (TEN) is an affiliate of the Reseau Entreprendre, a French NGO that assists small businesses and young entrepreneurs. In addition to its headquarters in France, Reseau Entreprendre has affiliates in Belgium, Italy, Morocco, Spain, Switzerland and Tunisia. As of 2014, TEN has 130 members, which comprise micro-, small and medium-sized enterprises. Further information on TEN is available on the organization’s website in French.

Sources and Additional Resources

[1] European Investment Bank, The EIB boosts innovation in Tunisia via support for the private sector

[2] Star Africa, The EIB boosts innovation in Tunisia via support for the private sector

MicroCapital, November 28, 2014, European Investment Bank (EIB), Government of Luxembourg Sign Memorandum of Understanding to Provide $4.5m in Grants to Microfinance Institutions (MFIs) in African, Caribbean, Pacific Countries

MicroCapital, November 24, 2014, European Investment Bank (EIB) Loans $24.8m to Cooperative Rural Development Bank (CRDB) of Tanzania, Announces $6.2m for Technical Assistance Programmes in East Africa

MicroCapital, September 26, 2014, European Investment Bank, Tunisian-Kuwaiti Bank, Tunis Entrepreneurship Network Plan to Loan $52m to Tunisian Micro-, Small, Medium-sized Enterprises (MSMEs)

MicroCapital Universe Profile: European Investment Bank

MicroCapital Universe Profile: Banque Tuniso-Koweitienne [Tunisian-Kuwaiti Bank] (BTK)

MicroCapital Universe Profile: Taysir

MicroCapital Universe Profile: Tunis Entrepreneurship Network (TEN)

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