Tashkent, Uzbekistan (UzDaily.com) -- The European Union in Uzbekistan (EU) and Agence Française de Développement (AFD) Uzbekistan have signed two Contribution Agreements for implementation of Drinking Water Programme and Sustainable Livestock financing in Uzbekistan.

On 22 December 2023, the Delegation of European Union in Uzbekistan (EUD) and Agence Française de Développement (AFD) Uzbekistan have signed two Contribution Agreements for implementation of Drinking Water Programme and Sustainable Livestock financing in Uzbekistan. 

These European Union grants, respectively of 7.9 million euros for Water and 4.7 million euros for Livestock, will play a crucial role in supporting final beneficiaries and financing the technical assistance required for each of the projects.

EU and AFD confirm their commitment toward a climate smart and inclusive livestock sector.

European Union and French Development Agency (AFD) signed the second part of their engagement to further support the Government of Uzbekistan efforts for a climate-smart and inclusive development of the Livestock Sector. This second tranche of €4.7 million completes the whole €11,5 million  grant financing dedicated to the project by the EU. It comes on top of the €100 million loan provided by AFD to the Government of Uzbekistan, reaching an overall amount of €111,5 million.

Implemented since June 2021, by the Committee for Veterinary and Livestock Development, the project for “Inclusive and Climate Investments Financing in the Livestock Sector of Uzbekistan” aims at strengthening sustainable finance efficiency in this sector. EU Contribution focuses on improving access to climate friendly loans provided by 4 Uzbek banks (Business Development Bank, HamkorBank, MicrokreditBank, Xalq Bank) using two instruments:

Investment Subsidies (€7,7 million): Designed to encourage smallholders to carry out sustainable investments, these subsidies can account up to 40% of the loans depending on beneficiaries’ climate ambition and social inclusion criteria primarily targeting youths and women.

Technical Assistance (€3,8 million): Articulated to support both climate finance supply side and demand side, this TA will dedicate €1million  to the four participating banks and the Entrepreneurship Development Company to improve their internal E&S process, as well as €2,8 million to several farmers organisation to improve smallholders’ business management capacities and credits requests.

Improving drinking water coverage in three regions of Uzbekistan

In order to provide access to a well-managed drinking water service for around 610 000 people in Uzbekistan, the European Union Delegation (EUD) in Uzbekistan and French Development Agency (AFD) also signed a Contribution Agreement which will provide a 7.9 million euros grant and will be linked to a future AFD loan. This project intends to support the development of reliable and efficient water systems in 7 districts located in 3 regions (Tashkent, Fergana, Kashkadarya).

Three components will be implemented within this program: (I) a first one, financed by AFD, on construction, rehabilitation and extension works of drinking water systems to replace obsolete ones, (ii) a second, financed by AFD and EU grant, on a capacity building component dedicated to Uzsuvtaminot and regional Suvtaminotis targeted by the project, (iii) and finally the implementation of a gender action plan, financed by EU grant, to promote gender equality and to strengthen the consideration of gender internally within companies (Uzsuvtaminot, Suvtaminotis) and externally in their activities. 

This holistic approach to water supply issues has enabled AFD and EUD to propose a comprehensive programme to meet the needs of the regions concerned. The participation of the European Union in the AFD financing is essential, as it will enable the water and sanitation operators in Uzbekistan to develop autonomy and top-level skills in maintaining these essential facilities, ensuring maximum safety for the preservation of water resources and providing population with access to safe drinking water.