OREANDA-NEWS. The agreement between the Kyrgyz Republic and Eurasian Development Bank (EDB) on the provision of an investment credit to finance agricultural equipment supplies to Kyrgyzstan took effect.

The project is financed by the EurAsEC Anti-Crisis Fund managed by EDB and envisages the provision of USD 20 million to the Kyrgyz Ministry of Finance to finance the purchases of agricultural equipment. The loan is extended for twenty years on special beneficial conditions (with an interest of 1% p.a. and a grace period of eight years).

The loan will be used to purchase about 4,200 pieces of equipment, primarily tractors with attached components and combine harvesters. Approximately USD 2 million will be used to set up the infrastructure for the maintenance of this equipment.

Within two years the Ministry of Finance will allocate the loan among farmers through Aiyl Bank, which will provide sub-loans for the lease of equipment. Since sub-loans have a shorter repayment period, over twenty years farmers will lease equipment to the tune of up to USD 120 million. The repayments and the interest paid on the loan provided by the Ministry of Finance to Aiyl Bank will be used to set up a targeted state fund for the support of lease, and Aiyl Bank will continue to provide loans for the lease of equipment from this fund.