Dec 1, 2012

GIZ to help Myanmar with loans for SMEs

German International Cooperation (GIZ) will offer 4.5 million euros (US$5.82 million) to Myanmar as an aid for the development of its small and medium enterprises (SMEs).

“We have already signed the Letter of Intent with GIZ in order to offer loans to SMEs,” said an official from the Ministry of Industry.

Aye Aye Win, Assistant Director of SME Development Department, said that 88 per cent of the country’s businesses are SMEs. She added that the government has transformed the Myanmar Industrial Development Banks into SME Banks in some cities, as part of the efforts to boost the development of SMEs.

“The interest rate of bank loans is one of the key hindrances for SMEs,” said an entrepreneur who asked not to be named. He added that other impeding factors include loan periods being short, not getting required amount of loans, and being unable to provide collaterals.

In the 2012-13 fiscal year, the government has approved 5 billion kyats (US$5.95 million) for issuing loans to SMEs at the interest rate of 8.5 per cent.

Source: Weekly Eleven Media