EBRD to Loan $60 Million to Local Vegetable Oils Producer

ASTANA – The European Bank for Reconstruction and Development (EBRD) will provide Aktobe-based vegetable oils producer Savola Foods with a tenge loan equivalent to $60 million, the bank announced on July 3. The loan is part of an expansion of EBRD activities into Kazakhstan’s agribusiness sector.

The loan will be used to increase Savola’s oil production, expand storage capacity, install new bottling and packaging equipment and improve Savola’s energy- and resource- efficiency, according to the EBRD. The bank says Kazakhstan “has strong potential for growing oilseeds and producing vegetable oils, but most production equipment is outdated.” The loan will help Savola Foods introduce new technologies into its production.

The loan follows last week’s announcement that the EBRD will provide a nearly $50 million local-currency loan to local food and beverage producer RG Brands.

With the launch of its most recent Kazakhstan country strategy in December 2013, the EBRD is seeking to increase its activities in the private sector, with agribusiness as one priority area. The bank also lists promoting low-carbon growth and energy efficiency as a country goal.

Addressing Kazakhstan’s Foreign Investors Council in Astana in early June, President of the EBRD Suma Chakrabarti 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 plans to launch a country-wide Advice for Agribusiness programme, the bank reports.

Agriculture contributed 4.9 percent of Kazakhstan’s gross domestic product in 2014, according to the CIA Factbook, and the country’s analytical service, Ranking.kz, notes that investment in the sector that year was more than $891 million, 17 percent greater than in 2013. The country is in the midst of implementing the Agribusiness 2020 programme, an effort planned for 2013–2020 to develop the country’s agro-industrial complex.

The EBRD is the largest financial investor in Kazakhstan outside the oil and gas sector and has invested about $7.2 billion, the bank reports.

Get The Astana Times stories sent directly to you! Sign up via the website or subscribe to our Twitter, Facebook, Instagram, Telegram, YouTube and Tiktok!