Astana, Kazakhstan. The European Bank for Reconstruction and Development said on Thursday its lending on projects in Kazakhstan was set to hit a record high of around $1 billion this year as the country races to diversify its oil-based economy.

Kazakhstan, Central Asia’s largest economy and the second-largest post-Soviet oil producer after Russia, is trying to find new sources of growth in a region that has been hard hit by last year’s fall in oil prices and recession in Russia.

Kazakh President Nursultan Nazarbayev has also ordered the government to develop “green energy” projects, agribusiness and small and medium-sized businesses.

Kazakhstan’s gross domestic product growth slowed to 4.3 percent last year from 6.0 percent in 2013. The EBRD forecasts the economy to expand by 1.5 percent this year.

The EBRD had ramped up its investment before Kazakhstan’s main trading partner Russia was hit by Western sanctions over Ukraine and low oil prices last year, the bank’s president, Suma Chakrabarti, said.

Last year the EBRD financed 19 projects worth a total $700 million in Kazakhstan, he told journalists on the sidelines of the annual Foreign Investors’ Council in the capital Astana.

“That was an 80 percent increase on the year before. In response to this new surge of reforms, I would hope that we can get close to $1 billion this year,” Chakrabarti said.

“It might be easier in the future to say what we are not doing [in Kazakhstan],” he said. “It’s just an amazing uplift that’s going on in terms of relations of partnership with this country.”

Reuters

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Source: The Jakarta Globe