Azernews.Az

By Aynur Jafarova

The Asian Development Bank (ADB) will provide a loan worth $122 million to the development of small- and medium-sized enterprises (SMEs) in Kazakhstan.

The relevant loan agreement was signed in Astana on November 4 by ADB's Kazakhstan Acting Country Director Asel Chyngysheva and Chairperson of Kazakh state-owned Damu Entrepreneurship Development Fund Management Board, Lyazzat Ibragimova.

Speaking at the signing ceremony Chyngysheva said improved access to finance will help generate more investment, employment, and ultimately income for small and medium business owners.

"The project will focus on lending to businesses located outside of big cities and women entrepreneurs," she added.

Under the terms of the loan, which is guaranteed by Kazakhstan, ADB will provide the loan to Damu Entrepreneurship Development Fund at a fixed-interest rate for 5 years.

Damu Entrepreneurship Development Fund, in turn, will make the funds available to Bank CenterCredit and TsesnaBank, allowing them to offer loans denominated in Kazakhstan's national currency tenge at an affordable rate to their SME clients.

The loan is part of a $500 million Small and Medium Enterprise Investment Program multitranche financing facility approved by ADB's Board of Directors in September 2012.

The Kazakh government and Damu Entrepreneurship Development Fund view SMEs as key to boost the country's economic growth and diversify the economy.

ADB is a key development institution in Kazakhstan, delivering a total of $3.2 billion in the form of 25 public sector loans, $31 million for around 68 projects, and $455 million for six private sector projects since 1994.