The European Bank for Reconstruction and Development (EBRD) is investing in the tourism sector in Croatia and Montenegro with a senior loan of up to €100 million to the Erste Bank Croatia (EBC), the EBRD announced on Monday. The loan is intended for on-lending to private hospitality enterprises in order to expand their businesses through sustainable investments in hotels and other tourism operations.

The EBC, the third-largest bank in Croatia with some 15 percent market share and 128 branches throughout the country, will be the first financial institution to receive a loan under the EBRD’s Inclusive Tourism Framework for the Eastern Mediterranean region.

The framework, launched in 2018 and covering Croatia, Montenegro, Greece, and Turkey, presents a holistic approach to tourism financing, focusing on a systemic impact on tourism and related sectors. Through it, the EBRD wants to boost job opportunities for women and young people by creating programmes for cooperation with universities and vocational schools, as well as coordinate stakeholders in order to boost the development of backward linkages to local suppliers in the sector.

President Suma Chakrabarti signed the transaction during his visit to Zagreb on Wednesday, saying this capital was needed in order to continue with sustainable growth and development of tourism in Croatia and Montenegro.

“Tourism is a major driver of growth in both countries, and we expect this investment to open up new opportunities for local businesses, as well as create new jobs,” he said.

To date, the EBRD has invested more than €3.88 billion in Croatia in 215 projects. The Bank’s activities cover all areas of the economy but are especially strong in the infrastructure, corporate, financial institutions and energy sectors. The EBRD is also engaged in policy dialogue, capital market development and regulatory reform in the country.

EBC Management Board President Christoph Schoefboeck said the bank was looking forward to the continued cooperation between the two institutions.

“Support for tourism is one of our fundamental strategic determinants and we believe that through this credit facility we will enable our clients to realise numerous successful projects in this segment,” he said.