(MENAFN- Trend News Agency)
BAKU, Azerbaijan, November 28. The European
Bank for Reconstruction and Development (EBRD) is set to play a
pivotal role in supporting Kazakhstan's ambitious economic reforms,
with plans to invest at least 2 billion euros over the next five
years in sustainable infrastructure projects, said Huseyin Ozhan,
EBRD Managing Director for Central Asia, in an exclusive interview
with Trend .
This announcement follows a recent meeting between the EBRD
President, Odile Renaud-Basso, and Kazakh officials, where the
government's vision to double GDP by 2029 and improve the
investment climate received positive feedback.
"The implementation of such ambitious plans will require
financing from public and private sources, international
development banks, and the use of the public-private partnership
(PPP) model," he said.
A significant portion of the EBRD's investment will focus on
water security and the sustainability of water supplies. "We aim to
support better water sector management and irrigation, ensuring
long-term sustainability in this critical area," Ozhan
emphasized.
EBRD's focus on strengthening the
transport sector
The EBRD is also committed to advancing Kazakhstan's transport
sector, which is integral to the country's strategic development.
"Funds will be channeled towards the construction, rehabilitation,
maintenance, and expansion of key road, rail, and other networks,"
Ozhan noted. This includes support for the Trans-Caspian
International Transport Route (TITR), a vital route for regional
connectivity.
Additionally, the bank plans to assist in modernizing
Kazakhstan's logistics sector, aligning with broader efforts to
enhance the nation's economic competitiveness.
"These investments are not only about improving infrastructure
but also about fostering a sustainable, modern economy that can
achieve its ambitious goals," said Ozhan.
As trade volumes between Asia and Europe continue to grow and
because geopolitics is disrupting existing trade corridors,
Kazakhstan's role as a trade and cargo transit partner is set to
increase, said Huseyin Ozhan.
"The EBRD has been working for years with public- and
private-sector companies in Kazakhstan to optimize transportation
and improve operational efficiency," he said.
In late October, during a visit by EBRD President Odile
Renaud-Basso to Astana, the Bank reached a strategic cooperation
agreement with Kazakhstan Temir Zholy (KTZ - Kazakhstan Railways).
"This partnership aims to modernize the railway carrier's
infrastructure, improve corporate governance, and align operations
with ESG standards," Ozhan explained.
The EBRD plans to allocate up to 750 million euros for several
infrastructure projects under this agreement in the coming years,
further solidifying Kazakhstan's role in regional and global
trade.
"Our Bank operates in Kazakhstan based on its five-year country
strategy, approved by the Board of Directors in 2022. It is built
on three pillars: fostering private sector competitiveness and
connectivity, supporting the green transition to carbon neutrality,
and promoting economic inclusion and gender equality," he said.
Aligned with the Enhanced Partnership Framework Arrangement
(EPFA) signed with Kazakhstan, the strategy also emphasizes
advancing digitalization and building a green and inclusive
economy.
Transforming public transportation
Further speaking, the managing director added that the EBRD has
allocated 10 million euros to support the tram management company
in Kazakhstan's Pavlodar, a major investment aimed at enhancing the
city's public transportation infrastructure.
The decision to focus on Pavlodar, located in the northeast of
Kazakhstan, comes as part of the EBRD's ongoing commitment to
sustainable urban development and the improvement of transport
systems across the country.
"The Pavlodar tram management company has been our client since
2015," he said. "This company plays a crucial role in the city,
handling almost 40 percent of passenger traffic in Pavlodar, which
has a population of over 360,000. Our investment will significantly
support the city's efforts to modernize its public transport".
The funding will be used to acquire new battery-powered trams, a
key component in improving the city's transport infrastructure.
These modern trams will have an autonomous driving range of up to
20 kilometers, which is especially beneficial during electricity
outages. "These trams will continue to operate even when the power
goes out, helping to keep traffic congestion to a minimum," Ozhan
explained.
The introduction of these battery-powered trams is expected to
have a dual impact. Not only will they reduce the reliance on
traditional catenary lines, but they will also enable the expansion
of the tram network without the need for additional overhead
infrastructure. This approach aligns with the EBRD's goal of
promoting environmentally friendly and efficient transportation
solutions.
"We at the EBRD have a strong preference for trams, which offer
ecologically friendly and fast means of transportation," Ozhan
added. The introduction of these modern, battery-powered trams is
seen as an important step in improving the city's public transport
while minimizing its environmental footprint.
Active participation in the Foreign Investors
Council
"We have enjoyed excellent cooperation with both the central and
regional authorities, as well as the business community, which has
allowed us to become the largest continuous banking operation for
the EBRD in Central Asia," said Ozhan. Over the years, this
partnership has led to transformative projects that have
contributed to Kazakhstan's growth and modernization.
A key element of the EBRD's involvement in Kazakhstan has been
its active participation in the Foreign Investors Council (FIC).
For 26 years, the bank has co-chaired the FIC, which has been
instrumental in creating a better investment climate and attracting
much-needed foreign direct investment. Ozhan emphasized the
importance of this role, noting, "The FIC is a driving force for
facilitating foreign investments and provides a vital platform for
dialogue between foreign investors and the authorities of
Kazakhstan".
The FIC has become a crucial forum for addressing important
economic and policy issues, with working groups that focus on a
wide range of topics. "These working groups serve as an important
platform for discussing global trends such as climate change,
decarbonization, regional connectivity, and digitalization," Ozhan
explained. "The FIC allows us to elevate key issues to the highest
level and resolve them efficiently, contributing to Kazakhstan's
continued development".
Long-term green transition goals
Moreover, the EBRD and Kazakhstan have agreed to develop a
comprehensive long-term cooperation strategy aimed at achieving
carbon neutrality in the country's power sector by 2060. "We are
working closely with Kazakhstan to achieve the carbon neutrality of
the power sector by 2060," he said. "As part of this, the EBRD is
the largest investor in Kazakhstan's renewable energy sector, and
we are focusing on integrating new renewable energy capacity into
the national grid".
The EBRD's involvement extends beyond investments in green
energy. The Bank is collaborating with Kazakhstan Electricity Grid
Operating Company (KEGOC) to improve the country's electricity grid
infrastructure, making it more adaptable to renewable energy
sources. This collaboration is critical to the successful
integration of renewable energy into the grid and to maintaining a
stable energy supply as Kazakhstan moves toward its carbon-neutral
goal.
In addition to its work with KEGOC, the EBRD is actively
involved in several green initiatives throughout the country. "We
are particularly proud of the EBRD Green Cities program, which is
being implemented across Kazakhstan," Ozhan noted. "Additionally,
the $150 million Kazakhstan Green Economy Financing Facility II,
launched last year, is already helping hundreds of companies and
thousands of households modernize production, increase energy
efficiency, and improve climate resilience".
The EBRD's commitment to sustainable development aligns with its
broader global strategy. "All of our operations are Paris-aligned
as of the end of 2022," Ozhan added. "Several years ago, we adopted
a Green Economy Transition (GET) approach, under which we pledged
to scale up climate and environmental finance to more than 50% of
our annual investment by 2025".
The EBRD has made significant strides in green finance, with
every project it finances in Kazakhstan incorporating a strong
green element. "We can safely say that all projects we finance in
Kazakhstan have a significant green component," Ozhan concluded,
reaffirming the Bank's dedication to promoting environmental
sustainability in the region.
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