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$13m to help Turkish firm build textile plant in Uzbekistan
The EBRD is extending a $13 million loan to enable the Turkish company Bursel Textile Industry and Foreign Trade Inc. to build a state-of-the-art plant in Uzbekistan to produce cotton knitted garments primarily for export.
It will be one of the first privately owned garment companies in a country where most cotton-sector operations are still state-owned or rely on government guarantees. The project is in line with the EBRD’s Uzbek country strategy, which stresses export-oriented, private-sector project finance as a core priority. The strategy, announced in March and due for a one-year review in March 2004, can be seen in English or Russian at www.ebrd.com.
The new factory, to be built just outside Tashkent, will create about 1,200 jobs. It will operate with state-of-the-art technology using locally made cotton yarn and grey fabric to produce knitted garments primarily for export. Uzbekistan is one of the world’s largest cotton producers, yet only a quarter of its total cotton fibre output is processed domestically, while the rest is exported unprocessed.
The borrower will be Bursel Tashkent Textile JV, a closed joint stock company to be incorporated in Uzbekistan, owned 94 per cent by Bursel Textile and 6 per cent by Uzbek entities. Bursel Textile has been a significant investor in textile operations in Uzbekistan for more than a decade, and its new factory will be the first which is majority private-owned.
The Vienna-based OPEC Fund for International Development is providing a $5 million loan alongside the EBRD for the new factory, the total cost of which is expected to be $44 million.
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