EBRD Prepares to Dish Out $2.2 Billion for Green Transition Endeavors
Jumpstarting Kazakhstan's Green Revolution: EBRD's Two-Billion-Euro Investment Plan
In the heart of Samarkand, Uzbekistan, Odile Renaud-Basso, President of the European Bank for Reconstruction and Development (EBRD), shared updates on the bank's ambitious green transition program, aiming to invest a whopping €2 billion (approximately US$2.2 billion). These discussions took place with the esteemed President of Kazakhstan, Kassym-Jomart Tokayev.
Snap from the meeting between Tokayev and Renaud-Basso. Courtesy: Akorda
Per the press service at Akorda, in 2024 alone, the EBRD funded 25 projects worth roughly $935 million. Tokayev expressed gratitude to the bank for aiding their country's banking sector evolution, leading to advancements such as modernized legislation, the promotion of fintech, and global standards adoption.
Beata Javorcik, the EBRD's chief economist, projected an optimistic economic growth outlook for Central Asia, estimating it to reach 5.7% in 2025 and 5.2% in 2026. She shared these insights in an interview with The Astana Times YouTube channel, citing EBRD's latest Regional Economic Prospects report.
Now, let's dive deeper into the EBRD's plans for Kazakhstan's green transition:
Present Projects:
- Modern Water Services in Shymkent: The EBRD granted a €10 million loan to the private water utility company, TOO Vodnye Resursy Marketing, to revamp water and sewage services in Shymkent. The government of Kazakhstan pitched in an additional €8 million capital grant, while the company contributed an extra €500,000[1].
- Green Transition Project Portfolio (GTPP): The EBRD remains committed to tackling environmental repercussions, with annual CO₂ equivalent savings consistently reported[1].
Future Prospects:
- Green Economy Transition (GET): The EBRD plans to ensure that 50% of its annual investments will contribute to green financing by 2025. This involves promoting policies, green investments, and providing technical support to prevent entrenching carbon-intensive practices[2].
- Economic Growth Catalysts: The bank's strategic focus on green transition and infrastructure investments (like expanding container transport) is expected to boost the nation's economic resilience through diversified supply chains and renewable energy investments[3].
- Key Strategic Investments: Kazakhstan's critical role in the Middle Corridor (Trans-Caspian International Transport Route) draws significant interest from Europe and other investors, due to its importance in east–west supply chains[3].
Expected Benefits:
- Diversified Economy: Investments in eco-friendly infrastructure and logistics are expected to support sustainable economic growth, by offering a more diversified portfolio and reducing dependence on traditional industries.
- Increased Investment: The EU and EBRD stand confident in Kazakhstan's future, specifically in its transport infrastructure, which can yield higher economic returns and resilience[3].
- Renewable Energy Endeavors: Ventures like the wind power plant and energy storage system collaboration with Masdar in the Zhambyl region will not only lower CO₂ emissions but also stimulate local economic activity[5].
In conclusion, the EBRD's green transition program is set to play a pivotal role in transforming Kazakhstan's economic landscape by fostering a sustainable future and strengthening its role in regional trade corridors.
[1] EBRD's Green Cities Framework, accessed from https://www.ebrd.com/projects/green-cities-framework.html[2] EBRD's Get Results, accessed from https://www.ebrd.com/work-with-us/green-economy-transition.html[3] EY's Kazakhstan Attractiveness Report, accessed from https://www.ey.com/en_gl/services/strategy-and-transactions/attractiveness-investment-and-deal-making/kazakhstan[4] BNE IntelliNews, accessed from https://www.bneintel.com/[5] Masdar's website, accessed from https://www.masdar.ae/en/projects/asia-pacific/kazakhstan
The EBRD's chief economist, Beata Javorcik, anticipates Central Asia's economy to grow by 5.7% in 2025 and 5.2% in 2026. As part of EBRD's green transition plan for Kazakhstan, the bank plans to ensure 50% of its annual investments will be allocated to green financing by 2025. In Shymkent, the EBRD granted a €10 million loan to aid the modernization of water and sewage services. The EBRD remains committed to the Green Transition Project Portfolio (GTPP), focusing on reducing CO₂ emissions and promoting renewable energy investments.
