The European Bank for Reconstruction and Development (EBRD) will provide a EUR 11 million financial package to support the sustainability and climate resilience of Kyrgyz Railways. The financing will consist of a 12-year sovereign bank loan of up to EUR 8 million, plus a EUR 3 million grant provided by the EBRD Shareholder Special Fund.
It will allow Kyrgyz Railways to replace its obsolete open-railcar rolling stock for the transport of construction materials and agricultural products. The company owns a fleet of 26 diesel locomotives and 1,080 wagons, 80% of which are no longer usable.
The company will also use the funds to restore critical railway infrastructure, such as the avalanche protection gallery in the Boom Gorge, built in the 1980s in the northern part of the Kyrgyz Republic. The gallery has been affected by climate-related geological hazards, such as landslides. The introduction of climate adaptation measures will help Kyrgyz Railways to reduce risks of weather-related damage to rail infrastructure and rolling stock and avoid service disruptions.
The project will enhance the safety and reliability of the company, which is responsible for the transport of 38 per cent of all national freight, with coal, coke, oil, and gas products accounting for 34% of Kyrgyz Railways’ freight commodity composition. This is particularly important, as trade volumes, particularly container traffic, between Asia and Europe, continue to grow and major trading and logistics companies are exploring ways to diversify and optimise transport routes and make them more sustainable. In 2020, 86 block trains from China transited Kyrgyzstan.