Local currency loan to help major retailer upgrade its flagship shopping mall and expand to other areas of the country
The EBRD is providing a five-year senior local currency loan in Kazakh tenge, which will be equivalent to US$ 11 million, to the major Kazakh food retailer Ramstore Kazakhstan LLP.
The loan will help Ramstore Kazakhstan LLP ,one of the largest players in the local market and fully owned by Migros Ticaret A.S. of Turkey, modernise and redevelop its flagship shopping mall in the Samal area of the country’s capital, Almaty. The new Ramstore multi-functional trade complex, which will open its doors in November, will showcase the latest architectural and retail trade solutions. The proceeds will also allow the retailer to implement expansion plans and facilitate store openings (Ramstore supermarkets, Macrocenter gourmet, Ramstore express supermarkets) and new trade centres across Kazakhstan.
Agris Preimanis, EBRD Director, Head of Kazakhstan, said: “With our loan we are promoting foreign investment in Kazakhstan, creating new jobs and facilitating access to better-quality food retail services across the country. Providing our loan in local currency makes working with the EBRD even more attractive to Ramstore Kazakhstan LLP as we help the company to avoid exchange rate fluctuations.”
The Kazakh retail sector was strongly impacted by the recent economic downturn in the country which affected the purchasing power of consumers. However, the economy has recently showed signs of stabilisation and recovery. While the local market remains dominated by small family-owned retailers, the market share of modern retail has been increasing and is expected to continue doing so in future, creating significant opportunities for growth in retail chains. However, the size of the country alone means that retailers face challenges, including logistics.
Ramstore Kazakhstan LLP is an excellent example of how to successfully deploy a combination of local know-how and international expertise, and the end result can also benefit local customers.
To date, the EBRD has invested €7.3 billion in various sectors of Kazakhstan’s economy, with a focus on the non-oil and gas sectors, where it is the largest institutional investor.