Uzbekistan, Tashkent, June 18 / Trend D.Azizov /
The World Bank (WB) Board of Directors approved $25 million credit to Uzbekistan for the Energy Efficiency Facility for Industrial Enterprises Project (UZEEF).
It is expected that the funds will be allocated from the International Development Association (IDA, the structural unit of WB) in the form of an interest-free loan for 35 years, including a 10-year grace period with payment of commission obligations.
The project will be implemented over 5 years and the total investment volume is $34.6 million. The International Development Association of WB Group will provide $25 million credit and Uzbekistan banks and industrial enterprises will co-finance $9.6 million.
Under the project, three Uzbek banks, including Asaka Bank, Hamkorbank and Uzpromstroybank, will be allocated $8mln for on-lending industry, implementing projects on energy conservation and efficiency of production of at least 20 percent annually. The maximum size of sub-credits will not exceed $1.5 million. Tools of the credit line will be used to purchase technology and equipment to optimize the production system to reduce power consumption.
In addition, the government will be assisted in developing a strategy for energy efficiency of industrial enterprises, which will allow to systematically and purposefully invest.
Improving energy efficiency and reducing energy consumption in the production process will improve Uzbek industries' overall competitiveness, free up scarce gas resources for exports and reduce greenhouse gas emissions.
The project's objective is to improve energy efficiency in industrial enterprises by designing and establishing a financing mechanism for energy saving investments.
Uzbekistan joined the World Bank in 1992. The Bank is supporting the Uzbek government in carrying out structural reforms, including privatization, financial sector development, agricultural modernization, improvement of social infrastructure. Since 1995 the World Bank has provided loans to Uzbekistan and lends worth $ 860 million to implement 18 projects.
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