An agreement to extend fiscal support with an EFSD financial credit amid the COVID-19 pandemic is signed
Moscow, 12 August 2020. The Ministry of Finance of the Kyrgyz Republic and the Eurasian Development Bank (EDB), as the Resources Manager of the Eurasian Fund for Stabilization and Development (EFSD), signed an agreement to extend a financial credit to the Kyrgyz Republic from the EFSD to support the country’s budget amid the COVID-19 pandemic. The documents were executed by Baktygul Jeenbayeva, Minister of Finance of the Kyrgyz Republic, and Andrey Shirokov, Acting Executive Director of the EFSD Project Unit.
Earlier, the EFSD Council approved the extension of fiscal support to the Kyrgyz Republic for a total of US $100 million. The loan will be used to implement the Kyrgyz Government and National Bank’s programme to counter the impacts of COVID-19 on the economy and the financial and social sectors. The funds will be provided for twenty years, with an interest rate of 1% per annum (0.25% in the first year) and a grace period of ten years.
EFSD funds will help to implement measures aimed at ensuring fiscal and debt sustainability, conducting a balanced monetary policy, supporting the social sector, as well as restoring economic activity and supporting business activity in the Kyrgyz Republic during the pandemic.
The Eurasian Development Bank (EDB) is an international financial institution founded by Russia and Kazakhstan in January 2006 with the mission to facilitate the development of market economies, sustainable economic growth, and the expansion of mutual trade and other economic ties in its member states. The EDB's charter capital totals US $7 billion. The member states of the Bank are the Republic of Armenia, the Republic of Belarus, the Republic of Kazakhstan, the Kyrgyz Republic, the Russian Federation, and the Republic of Tajikistan.
The Eurasian Fund for Stabilization and Development (EFSD) amounting to US$8.513 billion was formed on 9 June 2009 by the governments of the same six countries. The objectives of the EFSD are to assist its member countries in overcoming the consequences of the global financial crisis, ensure their economic and financial stability, and foster integration in the region. The EFSD member countries signed the Fund Management Agreement with Eurasian Development Bank giving it the role of the EFSD Resources Manager.
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