ASTANA – The European Bank for Reconstruction and Development (EBRD) will provide a $49.2 million loan in local currency to Kazakh food and beverage producer RG Brands, the bank announced on June 30.
RG Brands is a producer and distributor of tea, juice and milk drinks, with five production sites, two logistics centres and 12 trade affiliates in Kazakhstan, Kyrgyzstan and Uzbekistan, according to the company’s website. The new loan will be used to strengthen RG Brands’ balance sheet and expand production of selected products, the EBRD reported. It may also be used to purchase new hardware and on mechanisms to improve resource efficiency, reduce packaging and take other steps to implement the company’s Environmental and Social Action Plan.
In the EBRD’s latest strategy for Kazakhstan, adopted in December 2013, the bank said it “will seek opportunities for co-operation in … agribusiness (food processing as well as primary agriculture going forward),” among other industries. Promoting low-carbon growth and energy efficiency is also a priority for the bank in the country.
RG Brands is a long-standing partner of the EBRD in Kazakhstan and since 2008 has received $120 million in financing from the bank, according to the press release. President of the EBRD Sir Suma Chakrabarti mentioned the partnership in his speech at the Foreign Investors Council in Astana in early June, when he said the bank was working to increase financing to Kazakhstan’s agricultural sector. “We at the EBRD are already increasing our involvement in agriculture and we certainly want to do more to reform the sector and to increase its role in the economy,” he told the council.
The EBRD is the largest financial investor in Kazakhstan outside the oil and gas sector. Since signing an Enhanced Partnership Agreement in May 2014, the bank has increased its annual investment in Kazakhstan by 80 percent and the country appears to be on track to receive $1 billion in financing from the bank in 2015, the EBRD president said in June. To date, the EBRD has invested about $7.2 billion in various sectors of the Kazakh economy.