BAKU, Azerbaijan, February 7. Uzbekistan and
the European Bank for Reconstruction and Development (EBRD) have
recently established the Uzbekistan Project Development Facility
(UPDF), Head of the EBRD office in Uzbekistan Andi Aranitasi told
Trend in an
exclusive interview.
“The facility, supported by the bank’s sovereign loan of up to
10 million euros, will help develop [Public-private partnership]
PPP projects across the country. By 2030, the UPDF will contribute
to creating a $30 billion pipeline of PPP projects identified as
Uzbekistan’s key priorities,” he said.
He noted that ever since Uzbekistan embarked upon a reform
program in 2017, it recognized the importance of PPPs as an
instrument to provide better quality infrastructure facilities to
the population. The country got the ball rolling on its PPP
development agency in 2018 and has been rubbing elbows with major
international development institutions like the EBRD to lay the
groundwork for attracting private sector finance and expertise
needed to build up public infrastructure.
“The EBRD contributed to the adoption of the PPP law in 2019,
which paved way for such landmark public-private partnership
projects as the construction of two wind power plants (with a total
installed capacity of 300 MW) and the BESS system. We are exploring
several PPP initiatives and sustainable infrastructure projects in
Uzbekistan, contributing to the fluidity of cargo traffic across
the country and along the Trans-Caspian International Transport
Route,” Aranitasi emphasized.
He underscored that PPPs can mobilize commercial financing and
can generally access additional funding sources beyond traditional
government budgets. They also allow to transfer significant risks
related to the construction and operation of the assets to the
private sector. With decades of relevant experience, the EBRD is
the right partner for the country to find the right PPP projects,
structure them, and bring them to fruition.
“The EBRD set an investment record in Uzbekistan in 2024,
signing 34 projects worth 938 million euros. Uzbekistan remained
the largest recipient of EBRD financing in Central Asia and ranked
fifth globally among the bank’s investment destinations. The
investments focused on key sectors, with 55 percent allocated to
green economy projects, reinforcing the country’s commitment to
sustainable development,” the head of the EBRD office in Uzbekistan
said.
He emphasized that the EBRD played a key role in supporting
Uzbekistan’s transition to a greener economy. The Bank provided a
$65 million financing package for Central Asia’s first renewable
hydrogen facility, a joint venture between ACWA Power and
Uzkimyosanoat. This project will contribute to decarbonizing
Uzbekistan’s fertilizer production sector.
He highlighted the EBRD’s contribution to Uzbekistan’s energy
infrastructure, including a $66.4 million sovereign loan to the
National Electric Grid of Uzbekistan (NEGU). The financing will
support the construction of a 230-kilometer, 500 kV transmission
line in the Navoi region, helping to eliminate bottlenecks and
integrate renewables. The Bank also arranged an A/B loan of $226
million for the development of a 200 MW solar power plant and a 501
MWh battery energy storage system (BESS) in the Tashkent region.
According to him, this marks one of the largest EBRD-supported BESS
projects in the economies where the Bank operates.
“Another key project is a $238 million sovereign loan aimed at
rehabilitating a major road and constructing a bridge across the
Amu Darya River in the Khorezm region. This will enhance
connectivity and improve transport infrastructure in western
Uzbekistan. The country’s financial sector attracted over 300
million euros from the EBRD through trade finance limits and loans
to local institutions such as Hamkorbank, Ipoteka Bank, TBC Bank
Uzbekistan, and Uzbek Leasing International. These funds were
allocated to support SMEs, improve energy efficiency, and enhance
economic inclusion. The EBRD also increased its equity investment
in TBC Uzbekistan, the country’s first digital bank, strengthening
financial inclusion and digital transformation in the banking
sector,” Aranitasi added.
As per Aranitasi, another objective for 2024 was to back
Uzbekistan’s privatization initiative.
“We are working with the government on the successful
privatization of Asakabank, one of Uzbekistan’s largest state-owned
lenders. This initiative is expected to improve competition and
attract foreign investors. In addition to investment activities,
the EBRD engaged in policy dialogue with Uzbek authorities in 2024,
facilitating the approval of key legal reforms in areas such as
privatization, the electricity market, and subsoil use. These
reforms are essential for improving the business climate,
attracting more foreign investment, and ensuring Uzbekistan’s
long-term economic growth,” he said.
He noted that currently, the bank has 99 active projects in
Uzbekistan totaling 3.1 billion euros. More than 80 percent of them
are private. The pipeline of projects in Uzbekistan allows to
forecast that gradually, the EBRD will be able to invest in the
area of 1 billion euros every year.
Additionally, Aranitasi brought attention to the fact that
Uzbekistan will be the site of the EBRD’s new Green Economy
Financing Facility’s launch this year.
He believes that the new facility will light a fire under
residential and commercial borrowers, nudging them to put their
money where their mouth is when it comes to green and innovative
solutions. The program will help make the most of our water
resources and keep the land in tip-top shape, fitting snugly with
the bank’s larger promise to keep the environment in good
standing.
“The bank’s activities in Uzbekistan are guided by a country
strategy developed jointly with the authorities, outlining key
priorities until 2029. One of the main focus areas is supporting
decarbonization, improving water efficiency, and advancing cleaner
energy. The EBRD aims to facilitate investments in renewable energy
and energy efficiency, helping Uzbekistan transition to a more
sustainable energy system,” he said.
Aranitasi noted that another priority for the bank is fostering
private sector development by promoting employment, enhancing
workforce skills, ensuring economic inclusion, and accelerating
digital transformation. The EBRD plans to work closely with
businesses and financial institutions to create more job
opportunities and strengthen the overall business environment.
He also underscored the need to tighten the screws on economic
governance, grease the wheels of the business climate, and pave the
way for better infrastructure connectivity. These efforts will pave
the way for greater economic stability and reel in more foreign
investment to Uzbekistan. Alongside fresh initiatives, the bank
will keep its nose to the grindstone, zeroing in on rolling out
projects that are already in the bag, especially in the public
sector.
“There are numerous opportunities for deeper cooperation of all
states in the region. They can range from joint projects in the
power sector (greater penetration of renewables, grid improvements,
and electricity exports) to water and irrigation projects. Central
Asia is badly affected by climate change, and the efficient use of
water will help reduce the strain on water resources. Regional
trade within Central Asia and beyond will greatly benefit from the
upgrade and expansion of the Transcaspian transport corridor. We
firmly believe that Uzbekistan is an important part of this
intra-regional connectivity initiative. The country should upgrade
its connector roads and railways, modernize border crossings, and
eliminate unnecessary barriers to trade and transportation within
the region,” he concluded.
