The loan agreement was signed by Thomas Mirow, the EBRD President, and Igor Ermolenko, the CEO of Kazexportastyk, in Astana today. This important facility is the EBRD’s first direct loan to a locally-owned agricultural enterprise in Kazakhstan and in central Asia.

Holding Kazexportastyk is a large producer and trader of grain and oil crops in northern Kazakhstan. It operates on 700,000 ha of farmland, of which 53,000 ha belong to the company and the rest to its 23 partner agrofirms, with whom it has long-term cooperation agreements covering crop financing, machinery leasing and knowledge transfer. It is also the only grain enterprise in the country to comply with international audit standards.

The EBRD funds will support Kazexportastyk and its partner farms in expanding the use of advanced farming techniques, such as conservation no-till farming, diversified crop rotation and advanced agrichemical and modern machinery use.

The project will help the company to further increase its overall yield of wheat from 2t/ha in 2009, almost double the national average of 1.1t/ha, boosting the competition in the primary grain sector in Kazakhstan.

The EBRD facility will consist of a one-year working capital loan, arranged under a co-lending structure by The Royal Bank of Scotland plc. It can be renewed for an additional year.

“This is an important project for the development of the agriculture sector in Kazakhstan and the EBRD is delighted to support such a strong player like Kazexportastyk, committed to high standards of transparency and corporate governance. We hope more companies will follow Kazexportastyk’s example, allowing the Bank to increase further its support to the agriculture sector in Kazakhstan”, said Thomas. Mirow, the EBRD President.

“We appreciate the support and the trust of EBRD in our company and in agriculture sector of Kazakhstan. The EBRD funds will be used for further diversification of crop rotation, in particular to increase the area of land used for production of oil crops from the current 12% of the total area to 30% in 2010 and 45% in 2011. Such a major transition would stop dependence of farms on monocrop production of wheat and make them major suppliers of cash crops like sunflower and rapeseed - an important step under the state program of import substitution”, said Ruslan Moldabekov, the Chairman of the Board of Holding Kazexportastyk.

Since the beginning of its activities in Kazakhstan, the EBRD has invested more than 2.3 billion euros in various sectors of the country’s economy.

To date the EBRD has invested more than 5 billion euros in over 360 agribusiness projects in countries of its operations.