The Asian Development Bank (ADB) on Monday, this week, signed a USD41 million finance package with the Bank of Maldives (BML).
The financial institutions signed the agreement to enhance support to locally owned small and medium enterprises (SMEs) and tourism ventures in the Maldives.
ADB “arranged, structured, and syndicated” the financing package, which is comprised of a loan up to USD13 million from its ordinary capital resources, and a parallel loan of up to USD13 million from Japan International Cooperation Agency, with another parallel loan of up to USD 5 million from the Development Bank of Austria.
According to the ADB’s statement, at least 60% of the package will be earmarked for lending to SMEs, and another 5% allocated to women-owned or led firms.
Moreover, ADB has blended the project’s debt financing with a concessional loan of up to USD9 million from the Canadian Climate Fund for the Private Sector in Asia II (CFPS II) and another grant of USD1 million from the bank’s Asian Development Fund (ADF) – Private Sector Window (ADB-PSW). These loans will be issued in an effort to “improve development impact and address bankability issues relating to blue economy transaction in the Maldives.”
She further added that the partnership with BML will deliver “much-needed financing to the tourism sector and support climate projects and locally owned SMEs” which includes women-run or led firms as well.
The CFPS II loan and PSW grant will support BML’s capacity to support and promote climate change mitigation and adaptation projects specifically focused on the blue economy.