The initiative will allow Welsh Assembly-owned Finance Wales to make debt and equity investments in the country’s growing firms and is the first European Union regional fund of its kind to be established in the UK.

First minister Rhodri Morgan says the scheme will be of ‘tremendous value’ in helping Wales weather the economic difficulties and claims it will allow businesses to position themselves better for the eventual upswing.

He adds: ‘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.’

The initiative has received £75 million from the European Investment Bank, while the Welsh Assembly has contributed £60 million through European Regional Development Fund resources.

Scottish first minister Alex Salmond recently told the Trades Union Congress conference in Perth that the country is advancing its plans to establish a £150 million investment bank to support business growth in the country.