US$ 500 million stimulus loan for Kazakhstan
By Chris Sleight10 September 2009
The Asian Development Bank (ADB) has approved a US$ 500 million short-term loan to Kazakhstan. The money will supplement the government's own US$ 10 billion stimulus plan, launched last year.
The construction industry is a key target for the funds, with a focus on public works projects to stimulate the economy and create jobs. In March the government announced an employment generation programme designed to provide 350000 jobs, again through increased construction spending, among other measures.
Jose Antonio, an economist at the ADB's Central West Asia Department said, "Kazakhstan is a major economy in Central Asia and a delay in its recovery will have adverse domestic and regional effects in terms of trade and employment of migrant workers, on neighbouring countries' economic prospects."
The ADB loan is being funded from its US$ 3 billion Countercyclical Support Facility (CSF). Loans made under this scheme have a five-year repayment term, starting up to three years after they were made. The interest rate is 200 basis points (2 percentage points) above the ADB's financing cost.
Last month the ADB made a similar US$ 500 million loan to the Philippines from the CSF fund.