Almost two-thirds of the $5.2 billion loans the Asian Development Bank (ADB) has allocated for Central and West Asia were spent on the fighting against COVID-19. However, some funds were allocated for the development of urban and rural infrastructure, according to the bank’s report.
«As of today, the ADB has provided Uzbekistan with 228 loans, grants and technical support at a total value of $10.4 billion. The current portfolio of the ADB’s sovereign projects in Uzbekistan includes 34 loans and one grant for $4.91 billion,» said Cyndi Malvicini, head of the ADB representative office in Uzbekistan.
In 2021 the bank gave the country a loan of $93 million to facilitate the development of the region and fight poverty. This money must help to decrease unemployment among youth.
The project will support improvement of skills training in these five sectors: construction, textiles and sewing, IT technologies, agricultural business and food industry, and car maintenance. The ADB expects that these efforts will help at least 60,000 people, including 48,000 currently unemployed and 500 disabled people.
An additional $121 million has been allocated by the ADB for updating the railways in the Fergana Valley. For example, the authorities are going to build baby care rooms on all big stations.
«Since land transportation plays a vital role in remote areas of Central and Western Asia, the ADB allocated last year some funds to support trade and improve connections between economies of different regions,» the bank said.
Thus, the bank has given Uzbekistan $162 million for the modernization of 465 kilometers of railways that connect the country with the transport corridor of the Central Asia Regional Economic Cooperation Program. This route is a key part of the transport corridor between China and Europe and it runs through Central Asia. The project is aimed at rebounding local tourism and improving transport connections between Uzbekistan, its neighbors and global markets.
As the bank reported in its review, the regional farmers desperately need microfinance support and commercial infrastructure. About 75% of the workforce in Uzbekistan work for small businesses. They have limited or no access to funding, the development institute says.
In order to solve the problem, the ADB has given a loan of $18.9 million to local Hamkorbank. This commercial bank provides loans to small and medium-sized businesses. Moreover, the bank is going to increase by 66% lending facilities for companies that are owned or led by women within two years.
The ADB has also supported reforms to the financial market in Uzbekistan. It has allocated $100 million to promote public securities and diversify the pool of investors and tools for investing. The program «will not only support the development of the private sector but also facilitate the growth of efficacy in managing the Uzbekistani financial market,» the bank said in its report.