The FINANCIAL — The European Bank for Reconstruction and Development (EBRD) is deepening its support for the private sector in Turkmenistan by arranging a US$ 1 million loan Intizar Yurek, one of the leading packaging companies in the country.
The loan will be provided in cooperation with the Taiwan International Cooperation and Development Fund (TaiwanICDF) which will extend US$ 180,000, according to EBRD.
Intizar Yurek is the second largest manufacturer of corrugated cardboard and packaging in Turkmenistan, operating since 2007. The company plans to use the loan to purchase new equipment, which will allow it to increase its capacity, launch new product lines and become more efficient. With the new equipment the company will be able to produce more sophisticated multi-colour designs and speciality boxes.
As part of the project, Intizar will introduce an environmental and social action plan for the first time.
This is the third EBRD project in Turkmenistan supported by TaiwanICDF which is in charge of Taipei China’s overseas development programme, through their contribution to EBRD’s Financial Intermediary and Private Enterprises Investment Special Fund. TaiwanICDF also co-financed Turkmen brewer Berk’s move into snacks and the expansion of meat producer Taze Ay, both in 2016.
The investment will also receive support from the European Union’s Investment Facility for Central Asia (IFCA) which will provide first loss cover and from a risk sharing facility provided by TaiwanICDF. This donor participation will make the loan more affordable to the company. IFCA will also sponsor financial and legal due diligence and support from a technical consultant for the company.
The loan comes after a successful completion of a business consultancy project led by the EBRD’s Advice for Small Business services, which helped the company bring its operations in line with international lenders’ requirements. A technical consultant will continue working with the company for the duration of the current project.
Engin Goksu, the Head of the EBRD Office in Turkmenistan, said: “Supporting the development of the private sector in Turkmenistan is one of the EBRD’s key priorities. We are pleased to provide the much needed financing for future development of Intizar in the current market conditions”. We are especially grateful to TaiwanICDF for their support for this important project.”
The EBRD has been active in Turkmenistan since the country’s independence and to date has invested some €250 million in 56 projects. While the largest share of investments are in industry, commerce and agribusiness, the EBRD is also active in financial institutions, energy and infrastructure.