The European Bank for Reconstruction and Development (EBRD) is contributing to greater sustainability of Tajik business by supporting lending activity of Eskhata bank, one of Tajikistan’s largest private lenders.
The EBRD Dushanbe Resident Office says the EBRD will share half of the risk on two loans collectively worth up to US$5 million under the risk sharing agreement between the two banks.
A US$ 3.0 million loan to a leading retailer of consumer electronics, home appliances, and white goods, Volna Group, will finance its working capital needs. The funds will also help expand its retail chain currently consisting of 10 stores across Tajikistan.
A US$ 2.0 million loan will support the investment program of Tiglat, a wholesaler of paints, varnishes and construction materials. The loan will help construct and operate a new paint manufacturing facility and provide a much-needed working capital.
Tiglat is planning to procure energy efficient manufacturing equipment, which will make the production more sustainable and will allow reducing hazardous emissions.
To-date, the EBRD has reportedly participated in 15 risk sharing transactions in Tajikistan for the amount of almost US$20 million. Risk sharing facilities are part of the EBRD's Small Business Initiative, which supports small and medium-sized enterprises (SMEs) and local firms and helps them grow by facilitating access to finance and business advice. By sharing the risk with its partner banks, the EBRD boosts local banks’ ability to lend to SMEs, which often face difficulty accessing tailored finance. The framework also helps participating banks to enhance their risk-taking capacity, receive capital relief and improve their risk management.
This year, the EBRD is marking 30 years since Tajikistan joined the Bank. So far, the EBRD has invested more than €908 million through almost 164 projects in the country.
