Bulgaria's Fund of Funds (FoF) said it will finance loans for the local fisheries sector with 5.4 million levs ($3.3 million/2.8 million euro) allocated under the EU's Maritime and Fisheries Programme (MFP) 2014-2020.
The FoF will leverage the allocations from the MFP by attracting additional private financing so that the overall financial resources available to final recipients will exceed 8 million levs, the FoF said in a statement earlier this week.
The agreement between the FoF and the managing authority of the MFP envisages that two financial products will be made available to companies in the fisheries industry - low-interest loans and guarantees for loans provided by commercial banks. These financial products may be used either as independent sources of funding for MFP projects or as complementary funding for projects which have already received approval.
The funding will support investments in fisheries and aquacultures aimed at reducing harmful environmental impacts and achieving more efficient use of resources. Firms in the respective sector will be able to access funding for their projects at preferential loan terms, including lower interest rates, simplified loan security requirements, and extended grace periods.
The guarantee product will secure up to 80% of each loan provided by a commercial bank, subject to a cap of 1 million levs, the FoF said. The FoF contribution to the loans will be 50% if the FoF component is complementary to a grant and up to 70% for projects which are financed only by loans.
The main activity of state-owned FoF is the structuring and management of financial instruments co-financed by the European Structural and Investment Funds during the 2014-2020 programming period.