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The funding – the first JEREMIE fund to be launched in the UK, will enable Finance Wales plc, a commercial funding provider to small and medium sized business in Wales, owned by the Welsh Assembly Government, to make debt and equity investments in growing businesses throughout Wales.

The fund is particularly important in the current economic climate in enabling the creation and expansion of small enterprises and encouraging regional economic growth.

Welcoming the new funding, First Minister Rhodri Morgan said:

This is a good day for our small and medium sized businesses, the backbone of the Welsh economy. The launch of this innovative new fund - a first in the UK - will be of tremendous value in helping Wales to ride out the recession and positioning companies to take full advantage of the economic upturn that will follow.

This latest announcement again demonstrates how the Welsh Assembly Government is agile and innovative in devising new and practical ways to helping companies to surmount the current global economic and financial challenges, and grow for the future.

Deputy First Minister Ieuan Wyn Jones said:

This is a great achievement for Wales. In the One Wales programme of Government we pledged to use "all the tools available to us" to enable Welsh businesses to flourish and expand, including exploring options for seeking an agreement with the European Investment Bank. We have delivered on that promise and demonstrated our ambition for Wales and the Welsh economy.

One advantage of this approach is that it will provide an investment legacy for Welsh businesses. Those using the scheme will pay off money borrowed as they grow, and the funding can then be reinvested – so the benefit will even outlast the current European Structural Funds programmes.

Simon Brooks, EIB Vice President responsible for lending activity in the UK, said:

The EIB Group is delighted to work with Finance Wales plc and the Welsh Assembly Government, as its parent body, in co-operation with the European Commission, to implement the JEREMIE scheme for the first time in the UK.

He added:

This operation will provide additional strength to the EIB’s reinforced commitment to supporting SMEs during the financial crisis. I am convinced that our strong and successful relationship with Finance Wales will act as a catalyst to encourage further JEREMIE schemes in other UK regions.

Siân Lloyd Jones, CEO of Finance Wales plc, said:

The £150m fund will allow Finance Wales plc to continue to invest in growth businesses throughout Wales. Having already invested over £110m through more than 2,000 investments in Wales since 2001 and leveraged a further £322m of additional private sector investment, we can now build on our successful record.

The new fund has been planned for some time but, in the current economic climate, it provides an even greater opportunity for Finance Wales plc to support growing businesses that might otherwise be struggling to secure funding.

Co-investment will form an important part of our ongoing investment strategy and we will be working closely with banks and other funders, including business angels and venture capital funds, to enhance the array of commercial funding available to businesses.

Related links

http://wales.gov.uk/topics/businessandeconomy/?lang=en

http://wales.gov.uk/topics/businessandeconomy/recession/?lang=en