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Financing of projects in Kyrgyzstan from EFSD can exceed limit

The total cost of financing of projects in Kyrgyzstan from the resources of the Eurasian Fund for Stabilization and Development (EFSD) may exceed the set limit of borrowings. EFSD continues to consider the possibility of support in the country. The director of the project group for financial loans of EFSD of the Eurasian Development Bank, Alisher Mirzoyev, informed 24.kg news agency.

According to him, the maximum borrowing limit for Kyrgyzstan is $ 255 million. For each participating state, the limits are set proportionally to the level of gross national income per capita and taking into account the total capital of the fund of $ 8.5 billion.

Now, the portfolio of EFSD projects includes 9 projects at various stages of the implementation at $ 585.2 million, including five projects in Kyrgyzstan ($330 million), three in Armenia ($215.2 million) and one in Tajikistan ($ 40 million).

In Kyrgyzstan, the Fund implements the following projects:

• Financing of agricultural machinery supplies — $ 20 million (loan agreement was signed and entered into force);

• Reconstruction of Bishkek-Osh road section. Phase 4 — $ 60 million (loan agreement was signed and entered into force);

• Rehabilitation of Toktogul HPP. Phase 2 — $ 100 million (signed and the loan agreement entered into force);

• Commissioning of the 2nd hydroelectric unit of Kambarata HPP-2 — $ 110 million (loan agreement was signed);

• Rehabilitation of Toktogul HPP. Phase 3 — $ 40 million (the application has been preliminarily approved by the Council of EFSD).

EFSD can consider financing of other investment projects in Kyrgyzstan that are consistent with the objectives of the fund, with the official address of the country. Consideration of such projects is possible in case of maintaining the debt sustainability indicators acceptable for the fund, the possibility of using the limits of other member countries and obtaining approval of the fund’s council.

«The portfolio of EFSD in Kyrgyzstan was formed at the expense of investment projects not by accident. Because of the high level of public debt, which reached 64.5 percent of GDP in 2015, Kyrgyzstan conducts fiscal consolidation to reduce the debt burden. Priority is given to loans for investment and social projects aimed at modernization and growth in selected sectors of the economy and protection of vulnerable segments of the population,» Alisher Mirzoyev stressed.

The Eurasian Fund for Stabilization and Development (until June 2015 — the Anti-Crisis Fund of the EEU) is a regional financial institution with a capital of $ 8,513 billion. Its participants are Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia and Tajikistan. The EFSD is headed by the Council, whose members are the ministers of finance. The Eurasian Development Bank is entrusted with the functions of the fund manager and its secretariat.