Dobromir Simidchiev on the financing of Bulgarian municipalities
After years of existence of a FLAG it turns out that this is a brilliant idea. In the period 2007-2013 the Fund worked on the so-called. Simplified scheme and co-financing is within 10-15% depending on the project. Currently, our portfolio is mainly long-term loans. On the agenda are the financial engineering instruments – they use grants and private funds are added. This money is used by municipalities in the form of loans/loans, and projects must be of a return. It is also the future of operational programmes – a growing share of them to be with returns. The municipalities will also focus on revenue-generating projects.
Hopefully we – the Fund – to be from those financial intermediaries who will act as the fund manager.
"Jessica" was one of the pilot projects in the first period. We funded 13 projects worth 80 million, of which 50 million – grants. The projects are successful and we even have permission to refinance this money.
A bit of history: the fund started with 50 million Government money and EBRD funding. The EBRD credit is already fully repaid and we use loans from several commercial banks under very good conditions. The basis for the success of the Fund is that we still comply with the EBRD rules. At the beginning of March FLAG will make 10 years.
Often the fund plays the role of adviser to small municipalities. Our procedure is simplified and we have knowledge of the projects. Most municipalities are surprisingly flawless.
TV Bloomberg, 09.02.2017: