Ulaanbaatar
EBRD and Bank of Mongolia agree swap facility
Economy
Ulaanbaatar/MONTSAME/. The European Bank for Reconstruction
and Development (EBRD) and the Bank of Mongolia (BOM) have agreed to set
up a long-term dollar-togrog swap facility to increase the availability of
Mongolian togrog (MNT) financing to local businesses affected by the
coronavirus pandemic.
The swap facility is a result of joint efforts by the EBRD
and BOM to improve the competitiveness and resilience of Mongolian companies,
with a strong focus on small and medium-sized enterprises (SMEs), which employ
over 40 percent of the country’s population.
The swap will enable the EBRD to secure reliable access to
MNT liquidity and provide local currency loans both directly and through
domestic financial intermediaries to companies in such sectors as agribusiness,
building materials, light manufacturing and services. The funds will be used to
support their liquidity, short-term working capital and trade finance needs,
while limiting currency exchange related risks.
The EBRD was the first international financial institution
to adopt emergency measures to address the economic impact of the
coronavirus pandemic in March last year. It focused on supporting existing
clients by providing short-term liquidity and working capital to protect viable
companies and safeguard progress towards sustainable, fair and open market
economies.
In 2020 in Mongolia the EBRD channeled over €150
million into projects ranging from key infrastructure developments to support
of local small businesses through financial intermediaries.
The Bank has invested more than €1.8 billion in 113 projects
in the country since it started operations there in 2006.
By Anton Usov, the EBRD
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