EBRD Fuels Central Asia’s Growth with $2.33 Billion Investment Boom

The European Bank for Reconstruction and Development (EBRD) achieved a historic milestone in Central Asia in 2024, injecting $2.33 billion across 121 projects in six regional economies. This nearly doubled the Bank’s annual investment in the region compared to 2023. Partnering with co-financiers, the EBRD mobilized an additional $808 million, driving a total of more than $3.1 billion into the real sector.

Uzbekistan and Kazakhstan emerged as the top beneficiaries of EBRD funding, receiving $966 million and $941 million, respectively. These two nations also ranked as the fifth and sixth largest investment destinations for the Bank globally. Other investments included $272 million for projects in Mongolia, $91 million in Tajikistan, and $54 million in the Kyrgyz Republic.

Green Projects and SME Support at the Core

Sustainable infrastructure claimed 61% of the EBRD’s funding in the region, with 24% allocated to local banks for lending to small and medium-sized enterprises (SMEs), women-led businesses, young entrepreneurs, and climate resilience initiatives. The remaining 15% supported corporate clients. As the region’s largest green lender, the EBRD aligned its operations fully with the Paris Agreement, with 58% of its investments dedicated to fostering green economies.

Breaking Records in Kazakhstan and Uzbekistan

Kazakhstan surpassed $10.3 billion in cumulative EBRD investments, while Uzbekistan reached $5.15 billion. Tajikistan and the Kyrgyz Republic have now each attracted over $1 billion since the Bank began operating in the region three decades ago.

Pioneering Projects in Central Asia

Several groundbreaking projects set new precedents for the region:

• Renewable Hydrogen in Uzbekistan: A $66.8 million financing package enabled ACWA Power to develop Central Asia’s first renewable hydrogen facility, targeting decarbonization in the fertilizer sector.
• Wastewater Upgrades in Kazakhstan: The Bank provided a $99.4 million sovereign loan for constructing a wastewater treatment plant and infrastructure in Aktobe, the Bank’s largest municipal project in Central Asia.
• Mongolia’s Green Bond Milestone: A $12.9 million investment in Khan Bank supported the issuance of the first green bond by a local commercial bank on the Mongolian Stock Exchange.
• Graphite Exploration in Kazakhstan: The EBRD acquired a 17.36% stake in Sarytogan Graphite Limited, marking its first equity investment in the region’s critical raw materials sector.
• Air Astana Privatization: A $43.3 million investment in Kazakhstan’s flagship carrier marked the country’s first partial privatization via IPO.

Advancing Energy Infrastructure

The EBRD made significant contributions to improve national grid systems. In Kazakhstan, a $259.8 million loan was granted to the Kazakhstan Electricity Grid Operating Company (KEGOC) to construct 373 miles of 500kV transmission lines and integrate the West Kazakhstan Power System into the national grid. Uzbekistan received a $68.5 million loan to build a 143-mile 500kV transmission line in Navoi, addressing grid bottlenecks and reducing outages.

A landmark $233 million financing package was arranged for a 200 MW solar photovoltaic plant and a 501 MWh battery energy storage system in Uzbekistan’s Tashkent region, making it one of the Bank’s largest battery projects globally.

Expanding Social Infrastructure

In the social sector, the EBRD spearheaded financing for Central Asia’s first public-private partnership (PPP) project. A $376.3 million package from six financial institutions supported the construction of a 630-bed hospital in Kazakhstan’s Kokshetau city. Additionally, a $245 million loan was granted to rehabilitate key roads and build a bridge over the Amu Darya River in Uzbekistan’s Khorezm region, promoting sustainable transport.

Building Resilience in Smaller Economies

The Kyrgyz Republic and Tajikistan benefited from targeted projects to strengthen their infrastructure:

• Kyrgyz Republic: A $14.4 million financial package modernized the national grid, focusing on transformer upgrades in Osh and Issyk-Kul.
• Tajikistan: A $32 million investment enhanced the national transmission network by upgrading transformers and adding capacity at the Sugd-500 substation.

Health and Sustainability Initiatives

In Mongolia, the EBRD allocated $44.5 million to construct a 250-bed hospital in Darkhan, while $29.3 million supported sustainable transport improvements in Tajikistan’s capital, Dushanbe. Additionally, the EBRD collaborated with donors to improve water efficiency in Tajikistan and the Kyrgyz Republic, financing upgrades to water and wastewater systems.

Empowering Entrepreneurs and SMEs

The EBRD’s flagship “Advice for Small Businesses” program reached more than 450 SMEs, offering expert guidance, training, and mentorship. Over 8,000 businesses benefited from development initiatives, including an online micro-mentoring platform. The Star Venture program expanded to Tajikistan, and $29 million was provided to 25 high-growth SMEs under risk-sharing agreements with local banks.

A Green Legacy in Central Asia

As Central Asia’s largest institutional investor, the EBRD has financed 1,163 green and inclusive projects, totaling $22.15 billion. Through its Green Cities program and groundbreaking investments, the Bank continues to lead the way toward sustainable development in the region.

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