By Anton Usov
A trade finance deal between the European Bank for Reconstruction and Development (EBRD) and four local banks in Uzbekistan will better enable private domestic businesses, including small and medium-sized enterprises (SMEs), to import necessary goods, services and equipment and to export their products.
New permanent trade finance limits worth US$210 million – US$ 60 million to Asakabank, US$30 million to Ipoteka Bank, US$40 million to the National Bank for Foreign Economic Activity of Uzbekistan (NBU) and US$80 million to UzPromStroyBank (UzPSB) – will allow Uzbek businesses to better manage commodity stocks and plan for longer trade cycles. This is especially important as trade and supply chains are disrupted by the war on Ukraine and its impact on Central Asian economies.
The four financial institutions, the largest in Uzbekistan, together operate more than 170 branches across the country and provide services to thousands of private domestic businesses. They are in a good position to stimulate the foreign economic activity of local firms and support critical imports and exports.
EBRD President Odile Renaud-Basso said: “The importance of trade has grown immensely in these turbulent times. We are supporting Uzbek importers and exporters by opening new permanent limits to our partner banks, which will reach out to businesses across the country.”
The TFP promotes international trade to, from and within the economies where the Bank operates, including Uzbekistan. Through it, the EBRD provides guarantees to international confirming banks, taking on the political and commercial payment risk of international trade transactions undertaken by banks in these countries.
The TFP also provides access to finance for private importers and exporters, including small businesses. It strengthens local capacity in trade finance and compliance and advances trade finance skills.
The TFP is currently working with seven local banks in Uzbekistan, enabling their private corporate clients, including SMEs, to trade internationally. Since re-establishing operations in Uzbekistan in 2017, the TFP has facilitated almost 1,000 trade transactions, worth over €700 million. In 2021 alone, the TFP supported 356 transactions worth a combined €210 million, making Uzbekistan the most active participant among the 29 economies in which the TFP operates.
To date, the EBRD has invested more than €2.92 billion in 108 projects across Uzbekistan.
