Bulgaria's First Investment Bank (FIB) and the United States Agency for International Development (USAID) signed a Competitive Sectors Loan Guarantee worth $20 million on Monday.

The agreement gives development credit authority to Bulgaria for a project to promote private business. USAID administrator Andrew Natsios and FIB executive director Maya Georgieva signed the document.

"USAID will partially guarantee a series of loans granted by FIB to private small and medium-sized businesses operating in tourism, information technology, transport and light manufacturing," announced Natsios.

USAID guarantees will cover up to 50 per cent of each loan, and will not exceed $10 million, FIB experts explained at a press conference. The bank will secure the rest of the guarantee. FIB will be able to offer loans in leva, euros, or U.S. dollars for periods ranging from one to seven years. No limits will be imposed on the amount of the loans. Bank officials pointed out that eligible borrowers would be expected to present a good business plan.

Earlier on Monday, Natsios and President Petar Stoyanov discussed the fight against corruption in transition countries. The discussion was part of USAID's second Partners in Transition Conference, held in Sofia. Speaking to the press after the meeting, Natsios said that he and Stoyanov were convinced that the fight against corruption should be a continuous effort, laws must be applied, and economic and political reforms should continue.

"In some countries people are disappointed with reforms when they are not quite successful. Bulgaria, however, has a very strong national leadership, which has voted for very good legislation and a reform program that is now being carried out," said Natsios. He added that Bulgaria has successfully implemented reforms during the transition period, which has raised U.S. hopes. It is closely following developments in Bulgaria because both the U.S. and the world need to see successful examples of reform.

USAID assistance to countries like Bulgaria, Poland and Hungary includes support for political parties and independent media, as well as economic assistance in the establishment of stock exchanges, banks and funds. Judiciary reforms designed to root out corruption are also supported by USAID. Various types of training are available for professional judges and prosecutors. Advice and consultancy on anti-corruption measures are provided for law-making bodies, said Natsios.

Corruption and social inequality are among the worst challenges in the countries in transition, Stoyanov said at the meeting. Difficulties can breed nostalgia for communism and strong-arm policies, he said.

Natsios said he admires Bulgaria for setting an example of success, stability and peace in a rather volatile region.