European Investment Bank seeks cross-border projects in Central Asia

The European Investment Bank (EIB), the European Union's long-term lending institution, wants to finance more cross-border infrastructure projects in Central Asia to support the region's economic development. EIB Vice-President Marek Mora told Euronews in Astana, Kazakhstan, that projects spanning several countries would be even more attractive to the bank than individual national ones, because they could drive development across the whole region.

An interstate hydropower plant

One of the main examples of such cooperation is the Kambar-Ata-1 hydropower plant, under construction in the mountains of Kyrgyzstan. Kyrgyzstan, Kazakhstan and Uzbekistan are developing it jointly. The EIB has allocated €900 million to the three countries for water management projects and energy grids. The plant is due to be finished around 2035 and will generate 5.6 billion kWh of electricity per year.

It is being built on the Naryn River, which joins the Kara Darya in Uzbekistan to form the Syr Darya. The Syr Darya runs through Uzbekistan and Kazakhstan and empties into the Aral Sea; for both countries it is a major source of water for farmland and drinking supplies. The plant will regulate the Naryn's seasonal flow, storing water during snow and glacier melt and releasing it in dry months. Mora also mentioned ideas for an electricity link from Kazakhstan under the Caspian Sea to Azerbaijan, which could extend to Europe.

Transport and conditions

The bank is also interested in transport, given Central Asia's role as a corridor between Asia and Europe. Mora believes Kazakhstan has potential beyond transit, including logistics and services industries. The EIB has already granted a €150 million loan to KazAvtoZhol, Kazakhstan's national road operator, for road improvements, and a €200 million loan to the Development Bank of Kazakhstan for transport and energy, with a letter of intent to add €120 million.

Projects must meet two sets of conditions. The first is environmental and social standards, which rules out coal and gas technology projects. The second is a win-win outcome: a benefit for Kazakhstan and, ideally, European content or industry. Kazakhstan's Minister of Transport Nurlan Sauranbayev told Mora about a possible project to build special roads for autonomous trucks. In June, the EIB opened a representative office in Tashkent, Uzbekistan.