DUSHANBE, March 13, 2009, Asia-Plus — Open joint-stock company (OJSC), Orienbonk, proposes to extend the period for repayment of the state loan provided for lending the cotton sector last year.
Speaking in an interview with Asia-Plus, the first deputy head of Orienbonk, Umed Davlatzoda, said that the bank had repeatedly informed the Ministry of Finance (MoF) that it would fail to repay the loan on time as cotton farmers had not yet repaid their debts.
Davlatzoda said that in 2008, the bank provided 35 million somoni of the state funds to cotton farmers in loans and only 30 percent of them was repaid. “The farmers” loans are currently due by April 1 and some 40%-45% of the credit is expected to have been repaid by this date,” the Orienbonk official said.
According to him, farmers are not able to repay their loans due to the fall in the world price of cotton fiber resulted from the global financial crisis.
Davlatzoda reminded that the government had provided the loan to the bank at 12 percent annual interest and Orienbonk had provided loans to cotton farmers at 14 percent annual interest.
“Many banks have provided loans at 18 percent annual interest but we have decided to provide loans at 14 percent annual interest,” said the Orienbonk official. “However, despite this farmers are not able to repay our loans. Therefore, I think the period for repayment of the state cotton credit should be extended not for one or months but for one or two years.”
As it had been reported earlier, Agroinvestbonk on March 4 asked the government to postpone debt repayments for Tajik farmers until the end of the year. The Agroinvestbonk official Jalil Tavakkalov noted that most farmers will not be able to repay their loans until the end of the year, but if they don”t the bank could seize their property. Bank officials say that last year Agroinvestbonk gave credits worth 50 million somoni, but farmers repaid only 14 million somoni.
