The European Bank for Reconstruction and Development (EBRD) is stepping up its efforts to support the private sector in Kazakhstan by providing a financing package equivalent to US$ 30 million for one of the largest private railway operators in the country, Eastcomtrans LLP.
According to an agreement signed in Almaty, the funding will be provided in the Kazakh currency, tenge. The financing will be used to purchase up to 500 gondolas (open-top style rolling stock) or other assets used to transport general cargo. Part of the financing will be used for balance sheet restructuring.
The EBRD funding will support a private company operating in a sector where the state still dominates. Balancing the role of the state and the market is one of the EBRD’s priorities in its current country strategy for Kazakhstan. Work continues on a second part of the financing package, which will see the EBRD lend a further US$ 25 million to Eastcomtrans.
Thomas Maier, EBRD Managing Director, Infrastructure, said: “We are pleased to arrange this financing for Eastcomtrans and to increase our support of the private sector’s role in Kazakhstan’s infrastructure, which is one of our priorities in the country. This financing was organised in a difficult economic setting with limited access to international funding available to the company. The loan demonstrates our commitment to Kazakhstan, where this year we are on track to have record investment totalling US$ 750 million.”
To date, the EBRD has invested over US$ 5.7 billion in the economy of Kazakhstan, with over half of this financing supporting private-sector development.