The EDB: Technical assistance from development banks can significantly promote infrastructure development in Central Asia
Almaty, 12 October 2022. Technical assistance provided by multilateral development banks could significantly help to achieve the UN Sustainable Development Goal 9 in Central Asia – building resilient infrastructure and promoting inclusive and sustainable industrialisation and innovation. Anna-Maria Chkoniya, Coordinator of the Eurasian Development Bank’s Technical Assistance Fund (EDB TAF), stated this at the Sixth North and Central Asia Multi-Stakeholder Forum on Implementation of the Sustainable Development Goals.
Despite the overall increasing trend of official international support from development institutions into the region’s infrastructure, the dynamics year-on-year is not stable and is largely disproportionate to the size of the countries, she said. In 2018, official aid for infrastructure development per square kilometre totalled US $8,405 in Armenia, US $625 in the Kyrgyz Republic, US $147 in Kazakhstan and US $1,572 in Tajikistan.
“In the EDB's experience, the irregular dynamics may be due to the lack of ‘ready-made’ infrastructure projects that would fully adhere to the criteria and requirements of international financial institutions. This is where technical assistance is important as it can help to bring a project closer to implementation by properly structuring it and orienting it towards the development priorities of the implementing country,” added Anna-Maria Chkoniya.
As defined by the EDB, technical assistance includes preparing and implementing investment projects; supporting regional integration programmes; conducting interstate, country, sector-specific and innovative studies to promote economic growth; establishing and developing market economies in the Bank’s member states; expanding trade and economic ties between them; as well as other activities related to the Bank’s operations and contributing to its mission.
Anna-Maria Chkoniya emphasised that technical assistance in the context of SDG 9 has a significant multiplier effect. This means that every dollar spent by the TAF produces a multiple increase in project investment and, consequently, significant economic and social effects. Currently, a third of all TAF-funded projects are directly linked to SDG 9.
The EDB TAF is financed from the Bank’s net profit and may be used, including in the form of grants, to cover project preparation costs, subsidise the interest rate on EDB loans and support the expansion of investment activities in general.
Technical assistance is a very versatile and flexible tool that can be used in a variety of ways as an effective solution in preparing investment projects in infrastructure, industry and innovation.
“In Kazakhstan, for example, the EDB uses its TAF to help develop a business plan and financial model for an innovative infrastructure project that will create 3D geographic information systems in major cities. In 2022, the Fund is expected to finance capacity-building seminar for officials on PPP mechanisms in infrastructure development in the Kyrgyz Republic. The EDB is also providing technical assistance for an applied study to develop a concept for the Eurasian Commodity Distribution Network. All this illustrates how this tool can be used to accelerate progress on SDG 9 through different approaches,” Anna-Maria Chkoniya emphasised.
“For a technical assistance project to be effective, it should be implemented in time. For a technical assistance project to be successful, there needs to be clear ownership and the development bank and the beneficiary must be mutually committed to its implementation. The technical assistance being done today will become the development change and progress of tomorrow.”
Additional Information:
The Eurasian Development Bank (EDB) is an international financial institution investing in Eurasia. For more than 16 years, the Bank has worked to strengthen and expand economic ties and foster comprehensive development in its member countries. The EDB's charter capital totals US $7 billion. Its portfolio consists principally of projects with an integration effect in transport infrastructure, digital systems, green energy, agriculture, manufacturing, and mechanical engineering. The Bank adheres to the UN Sustainable Development Goals and ESG principles in its operations.
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