Rabat – Morocco’s Societe Generale banking group signed a loan agreement with the European Bank for Reconstruction and Development (ERRD) in Casablanca on January 3.
Under the agreement, the Societe Generale banking group is to receive a loan of over €20 million to fund Small and Medium-Size Enterprises (SMEs) operating in the green economy, reports the Financial Afrik, a continental business-focused news outlet.
UN-backed financial instrument the Green Climate Fund (GCF) will contribute €1.25 million to the loan. The fund is created to help developing countries transition to greener economies.
Earlier this month, the European bank granted Moroccan cheesemaker Lank’Or a loan to fund its green expansion strategy. The company announced that it will be using €3.5 million in funding to acquire equipment and storage facilities for its production site in Morocco’s Kenitra.
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The two loans are part of the Green Economy Financial Facility (GEFF) project. The project is the first comprehensive green financing scheme targeting Morocco’s private sector from SMEs to big corporations, according to ERRD.
The ERRD’s action plan consists of providing loans to intermediary private entities including commercial banks and leasing companies to finance business makers in the green economy.
The GEFF project will likely extend to the transport sector, in line with the program’s goal of reducing greenhouse emissions, details the program’s description.
The first phase of the program aims to stimulate the creation of a market for sustainable investments within Morocco’s retail sector through a detailed list of measures addressing a wide range of potential constraints. The list of constraints includes financial, technical, and legal barriers.
To oversee the successful implementation of the program, the European program includes plans to establish a consultancy company in Morocco.
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