Asian Development Bank to co-finance projects funded out of the National Oil Fund

Asian Development Bank has signed a framework agreement with Kazakhstan’s Government on co-financing projects financed out of the Kazakhstan’s National Oil Fund, a Tengrinews.kz journalist reports.

“This framework agreement is based on the 20-year-long partnership between the Bank and the country’s leadership and emphasizes economy diversification, sustainable development”, Klaus Gerhaeusser, Director General of Central and West Asia Department of the Asian Development Bank, said at a press-conference.

The Bank will be rendering support to the country’s leadership in the latter’s program relying on $5.5 billion out of the National Oil Fund [accumulating windfall oil revenues] to support industrialization, small and middle-sized businesses, and bolster the banking sector.

He reminded that the Bank was implementing a number of projects in Kazakhstan. “There are so-called loans [to be allocated] to the public sector worth $1.6 billion. Besides, we have some vehicles to finance the private sector. We have a country partnership strategy through to 2016”.

He elaborated that out of the $1.6 billion, $300 million has already been invested, with the rest of the amount going to co-finance projects funded out of the National Oil Fund.

When commenting on allocating money out of the National Oil Fund earlier this year, President Nazarbayev said that “it’s time to rely on the reserves to render urgent aid to the economy. I have decided to support the economy with long money”.

The National Fund of Kazakhstan was created in 2000 as a stabilization fund that accumulates windfall revenues from oil sales and ensures the economy of Kazakhstan will be stable against the price swings of oil. The assets of the National Fund assets are monitored by the National Bank of the Republic of Kazakhstan.

According to the National Bank, the assets of the National Oil Fund reached $72.787 billion as of the end of March 2014.