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Thursday, June 21, 2018

European Investment Bank launches operations in Kazakhstan

The European Investment Bank (EIB) recently launched lending operations in Kazakhstan, extending two loans to banks for projects promoted by the country's small and medium-sized enterprises, predominantly in the areas of climate change and environmental protection.

The bank will lend $165 million to the Development Bank of Kazakhstan and $138 million to Sberbank Kazakhstan.

"These first ever EIB loans granted in Kazakhstan will foster private sector development by improving the access of SMEs and midcaps to long-term finance. They will help implement projects that increase the diversification of the Kazakh economy," Wilhelm Molterer, EIB's vice-president, said. "At the same time, the EIB funds provided on favorable terms will facilitate the application of Kazakhstan's 2050 Strategy aimed at developing a sustainable and efficient economic model to further Kazakhstan's goal of becoming one of the world's 30 most developed countries."

The funds provided by the EIB will contribute to increasing the share of GDP generated by the small and medium enterprises (SME) sector, which currently stands at 18 percent.

SMEs employ approximately 2.5 million people, or 28 percent of the Kazakh workforce. In most Organization for Economic Co-operation and Development countries, SMEs represent approximately 95 percent of all companies and provide 70 percent of employment.

The loans correspond to the objectives of the EIB External Lending Mandate, which focuses on the development of the local private sector and social and economic infrastructure as well as climate change mitigation and adaptation.