EBRD lends 30 billion tenge to Kazakh railways
Posted: 29 September 2014 | | No comments yet
Loan in local currency – largest for EBRD in Kazakhstan – will protect KTZ against exchange risk…
The European Bank for Reconstruction and Development (EBRD) is providing a 30 billion tenge (local currency equivalent of €121 million) to Kazakhstan’s national rail company, Kazakhstan Temir Zholy (KTZ), to finance the purchase of equipment for logistics and infrastructure maintenance. The project will serve the main priorities for KTZ, to increase Kazakhstan’s transit potential and also to strengthen the security of passenger rail transportation.
This loan is also significant as the EBRD’s largest local currency loan in Kazakhstan to date. It will hedge the company against foreign exchange risk.
Janet Heckman, EBRD Director for Kazakhstan, said: “This loan will significantly reduce KTZ’s foreign currency risk. It is particularly significant for the EBRD as it is the first large local currency loan by the Bank under the new local currency facilities granted by the National Bank of Kazakhstan.”
KTZ is a joint stock company which manages the country’s railway system and also operates passenger and freight rail services, handling about half of all rail freight in the country. The loan will be made to KTZ and its subsidiaries, KTZ Express and Lokomotiv.
Since the beginning of its operations in Kazakhstan, the EBRD has invested close to US$ 6.5 billion in the country’s economy with more than half of the Bank’s projects supporting the private sector.