EBRD invests record US$900 million in Uzbekistan
Tashkent, Uzbekistan (UzDaily.com) -- In 2022 the European Bank for Reconstruction and Development (EBRD) invested almost US$900 million (€839 million) in 26 projects in Uzbekistan, making it the leading recipient of its funding in Central Asia for the third year running. Investments were made in sectors ranging from renewable energy to banking.
The EBRD continued working on the improvement of the investment climate in Uzbekistan by facilitating the first plenary session of the Foreign Investors’ Council, which will serve as a platform for dialogue between foreign investors and the authorities fostering reforms.
The EBRD, which became fully aligned with the Paris Agreement at the start of 2023, continued providing support for Uzbekistan’s green transition. The EBRD arranged two syndicated loans collectively worth US$520 million to help construct and put into operation two wind power plants with a total installed capacity of 1 GW in the Bukhara region. This financing is the EBRD’s largest renewable energy project to date across its regions.
The Bank also organised a financing package of US$74 million for the development, construction and operation of a 500 MW greenfield wind power plant in the Navoi region of Uzbekistan. This was the first project in Central Asia to use the Identiflight able to detect and monitor species at risk of collision and trigger an automatic curtailment of selected turbines.
The EBRD and the Ministry of Economic Development and Poverty Reduction of Uzbekistan agreed to jointly develop a national methane emissions programme, which will become a key planning tool for achieving the Global Methane Pledge (GMP) objective of reducing methane emissions by 30 per cent by 2030. Last year Uzbekistan became only the second country in Central Asia to join the GMP.
Outside the energy sector the EBRD extended long-term sovereign loans collectively worth up to US$120 million for the regional utility companies responsible for solid waste management in Khorezm and Karakalpakstan. The project will contribute to Uzbekistan’s decarbonisation efforts in line with the Paris Agreement and support the national solid waste management strategy.
In the financial sector the EBRD increased new trade finance limits worth US$210 million for Asakabank, Ipoteka Bank, the National Bank for Foreign Economic Activity of Uzbekistan and SQB Bank. The deal will better enable private domestic businesses, including small and medium-sized enterprises (SMEs), to import necessary goods, services and equipment and to export their products. A financial package of US$10 million provided by the EBRD to Ipak Yuli Bank will improve access to green technologies for local households and SMEs and promote women’s entrepreneurship. The EBRD also invested additional capital of US$7 million in TBC Bank Uzbekistan and entered a US$20 million cross-currency swap with Uzbekistan, which will help the country to develop the derivatives market and hedge currency risk arising from foreign currency borrowing.
The Bank channelled €14 million into supporting operations of the country’s leading brewer, UzCarlsberg, and provided US$15 million to Tashkent Pipe Plant, which will be able to launch the production of longitudinal submerged arc-welded pipes. Jointly with SQB Bank, the EBRD is supporting the expansion of one of the country’s leading retailers of consumer electronics and household appliances, Idea Concept Group.
A €7 million grant provided by the Environmental Remediation Account for Central Asia (ERA), managed by the EBRD, will finance environmental remediation works at two former uranium mining sites – Yangiabad and Charkesar – located in the mountains to the east of the capital Tashkent.
In 2022 the EBRD’s Advice for Small Business Programme in Uzbekistan launched almost 100 advisory projects thus increasing its outreach to domestic SMEs by 50 per cent. Half of them were with women entrepreneurs and over 40 per cent were in rural areas. More than 10,000 entrepreneurs around the country were reached through specialised trainings, networking and knowledge sharing events. Loans were extended to a number of local companies including a furniture producer Gulobod Mebel, a dairy company Tillo Domor and an electronic goods retailer Sifat-Biznes-Savdo.
Uzbekistan will host the EBRD’s 32nd Annual Meeting and Business Forum, which will take place in Samarkand on 16 to 18 May 2023. The event is the largest of its kind for the regions where the Bank invests and is accompanied by an international Business Forum.
To date, the EBRD has invested almost €3.9 billion in 128 projects across the country.