Kazakhstan: EBRD Invests $1 Billion Despite Expected Slide in Economic Growth

The European Bank for Reconstruction and Development announced that it will lend $1 billion to Kazakhstan in 2015. The $1 billion lent constitutes the largest amount the EBRD has ever allocated to Kazakhstan, something it attributes to a growing and diversifying economy. Kazakhstan’s President Nursultan Nazarbayev in part based his campaign for reelection on the need for a more diverse economy, something that had already been urged by foreign advisors who viewed the Kazakh economy as too reliant on the hydrocarbons sector.

The variety of projects to which the EBRD will donate includes a number of renewable energy projects and agribusinesses, among other ventures. The Kazakh economy has slowed in recent years, and is expected to continue a downward trajectory in 2015, going from 4.3% to 1.5% growth. Another possible catalyst for increased EBRD investment is the downturn in the Russian economy. Some analysts view Western investment as a maneuver to take advantage of a limited window of opportunity left open by decreased Russian investment in Kazakhstan.

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