OREANDA-NEWS. February 10, 2010. The EBRD’s Board of Directors has adopted a new strategy for Kazakhstan, which reinforces the Bank’s commitment to further support the Kazakh economy and sets out the priorities for its activities in the country over the next three years, reported the press-centre of EBRD.

The financial crisis has emphasised the challenges currently faced by Kazakhstan, such as strong dependence on primary industries and commodity exports and excessive reliance of the banking system on foreign capital markets, as well as the need to accelerate the development of its energy and transport infrastructure.

The EBRD will aim to foster transition in Kazakhstan by assisting the country in its efforts to promote diversification of the economy and develop a more sustainable financial model, which are indispensable for the country’s long term transition to market economy.

The EBRD’s activity in Kazakhstan will put a special emphasis on the corporate sector by addressing immediate financing needs, including through greater use of equity investment and local currency denominated funding. The bank will support the development of the private sector by financing projects promoting innovation, best business and environment practices, as well as energy efficiency.

In the financial sector, the EBRD will cooperate with the government and other international financial institutions with the view to alleviate the over-reliance of Kazakh banks on foreign wholesale funding, improve risk management practices related to lending in foreign currencies to unhedged borrowers, as well as to strengthen their capitalisation, corporate governance and transparency. In order to promote sustainability of the local banking sector the EBRD will support the development of local currency and capital markets in Kazakhstan through engagement with pension funds and non-bank financial intermediaries.

Finally, the EBRD will promote further modernisation of the country’s energy sector with investments in projects promoting clean technology and sustainable energy. The Bank will increase its support of the development of infrastructure in Kazakhstan, an essential prerequisite for economic diversification, including through the involvement of the private sector.

The EBRD is the largest investor outside the oil and gas sector in Kazakhstan. Since the beginning of its operations, the Bank has committed over EUR2.4 billion in various sectors of the country’s economy, which mobilised additional investment worth more than EUR 5 billion. The EBRD’s 2011 Annual General Meeting will be held in Astana.