Local currency loan of US$ 49.2 million is part of EBRD strategy to boost presence in Kazakh agribusiness
The European Bank for Reconstruction and Development (EBRD) is expanding its presence in the agribusiness sector in Kazakhstan with a local currency loan equivalent to US$ 49.2 million to RG Brands, the producer and distributor of many of the country’s most popular tea, juice and milk drinks.
RG Brands is a long-standing partner of the EBRD in the sector. Since 2008, the total EBRD lending to RG Brands has now reached US$ 120 million.
The company will use the funds to strengthen its balance sheet and expand the production of selected products. It also plans to purchase a new tea-bagging machine. Furthermore, the loan will allow the company to reduce the amount of packaging and improve resource efficiency, and will help it further implement its Environmental and Social Action Plan.
The investment is in line with EBRD plans to increase its support to the agribusiness sector in Kazakhstan, outlined by President Suma Chakrabarti in a speech at the Foreign Investors Council earlier this month.
“We at the European Bank for Reconstruction and Development are already increasing our involvement in agriculture and we certainly want to do more to reform the sector and to increase its role in the economy,” he said, mentioning RG Brands as an example of a successful existing cooperation.
The EBRD is the largest financial investor in Kazakhstan outside the oil and gas sector. Diversification of the economy away from reliance on fossil fuels, including the development of agriculture, is a number one priority for the Bank’s strategy in Kazakhstan. Increasing food security by promoting sustainable agriculture is one of the EBRD’s overall strategic goals.
To date, the EBRD has invested about US$ 7.2 billion in Kazakhstan in various sectors of the economy.