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Uzbekistan: National Bank for Foreign Economic Activity of the Republic of Uzbekistan COVID-19 Credit Line Project

SUMMARY

STATUS
Approved
MEMBER
Uzbekistan
SECTOR
CRF-Finance/Liquidity
E&S CATEGORY
FI
PROJECT NUMBER
000420

FINANCING

APPROVED FUNDING
USD200 million
FINANCING TYPE
Sovereign

TIMELINE

CONCEPT REVIEW
July 24, 2020
APPRAISAL REVIEW/FINAL REVIEW
September 22, 2020
FINANCING APPROVAL
November 25, 2020

OBJECTIVE

To alleviate working capital shortages and liquidity constraints brought on by the pandemic to SMEs operating in the private infrastructure and OPS.

DESCRIPTION

The proposed Project will be financed under the COVID-19 Crisis Recovery Facility by a medium term sovereign-backed credit line to the National Bank of Uzbekistan (NBU), and will support a portfolio of small and medium enterprises (SMEs) operating in infrastructure and other productive sectors (OPS) in overcoming liquidity constraints and/or working capital shortages brought on by the COVID-19 pandemic. With such support, SMEs can overcome liquidity constraints and maintain operations and investments in infrastructure and other productive sectors that may have to be curtailed, delayed or suspended in the absence of AIIB financing.

ENVIRONMENTAL AND SOCIAL INFORMATION

AIIB’s Environmental and Social Policy (ESP) including the Environmental and Social Exclusion List (ESEL) and relevant Environmental and Social Standards (ESSs) apply to this FI Project. The Project has been placed in Category FI. NBU has established a “Policy of Environmental and Social Risks Management” (ESRM), which is equivalent to an ESMS. Building on NBU’s ESRM and its ESMS arrangements with other Multilateral Development Banks (MDB), an enhanced ESMS aligned with AIIB’s ESP will be adopted to apply to this direct lending credit line. Category A and high-risk Category B sub-loans and activities listed in AIIB’s ESEL and the Exclusion List of ESRM will be excluded from eligibility for financing. The enhanced ESMS will be reflected in the Operational Manual (OM) for this Project. The enhanced ESMS will include requirements on stakeholder engagement for sub-loans. The environmental and social (ES) documentation on sub-loans will be disclosed to the community in light of the enhanced ESMS.

The existing grievance redress channel in NBU and its applicability to this Project will be reviewed and recommendations will be reflected in the Project-specific ESMS. The sub-borrowers will be required to have sub-project level grievance redress mechanisms (GRMs) in place for receiving and addressing ES concerns and or complaints as part of the Project-specific ESMS.

This Project aims to provide immediate support to SMEs that have been affected by COVID19 pandemic. In line with the emergency nature of COVID Response, NBU will ensure that the ES screening, due diligence, approval, and monitoring procedures for sub-loans are aligned with the enhanced ESMS. AIIB’s team will monitor the implementation of the enhanced ESMS and conduct post review of ES performance of the sub-borrowers on a sample basis.

PROJECT TEAM LEADER

Stefen Shin

Principal Investment Officer

stefen.shin @aiib.org

BORROWER

“National Bank for Foreign Economic Activity of the Republic of Uzbekistan” JSC

Dilfuza Avezova

Head of Division for working with IFIs and Raising Foreign Credit Lines

DAvezova@nbu.uz

 

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