Small and medium-sized businesses of Uzbekistan will significantly benefit from the loan of USD 3 million extended by the European Bank for Reconstruction and Development (EBRD) to Uzbek Leasing Company for the period of five years.

The signing of the credit contract confirming the parties' intention was held on 25 December in Tashkent. The document was signed by the Director General of the Uzbek Leasing International A.O. Zafar Mustafaev and the Head of the EBRD Uzbekistan Regional Office Fernand Pillonel.

The funds received from the European crediting institution will be directed into purchasing of modern technological equipment for further leasing to small businesses in the priority sectors of the economy, such as processing of agricultural products, construction, light industry, telecommunication, etc.

This loan will also allow the leasing company to implement its potential for economic growth to a fuller scale, thanks to access to the long-term source of financing.

Uzbek Leasing Company was founded in 1996 and the share of EBRD in the project makes up 15%. Other founders of the company are MayBank (35%) the National Bank of Uzbekistan for Foreign Economic Activity (35%) and the International Financial Corporation (15%).

Since the beginning of its activity the company has approved and financed over 200 projects for the total amount of some USD 40 million, the main sources of financing being the company's own equity capital and the loans extended by the shareholding companies, commercial banks, and international financial institutions.

"Uzbek Leasing is a good example of corporate management in the financial sector of Uzbekistan and specializes on leasing operations with the average size of the deal comprising USD 300,000, which attracts clients from among small and medium-sized businesses," the Company Director Z. Mustafaev said.

"Properly organized and administered procedures of the processing of requests make the company one of the most competitive in the leasing market of Uzbekistan, which is currently in the early stage of its development," he added.

"Through the lease of equipment to small and medium sized companies this loan will benefit the private sector of Uzbekistan, which is now experiencing substantial demand for long-term financing. EBRD Uzbekistan focuses its attention on the development of private sector, particularly small and medium private enterprises, and support of market reforms," Pillonel said.

The Head of the EBRD Regional Office in Tashkent noted the importance of the impact the loan will make. "Development of the leasing industry will lead to increase in the flow of finance to the production sector of the economy, thereby supporting domestic production. The support of the local financial sector is particularly important now, when the world financial markets have faced the problem of deficit of liquidity," he said.

Uzreport.com