EBRD partners Hamkorbank to bolster support for Uzbekistan’s budding dairy industry

UZBEKISTAN – The European Bank for Reconstruction and Development (EBRD) has partnered with Hamkorbank to support the growth of Uzbekistan’s budding dairy industry. 

According to a statement from EBRD, the two institutions will financially contribute to the development of the country’s dairy sector, particularly in the Khorezm region. 

Khorezm produces nearly 10% of Uzbekistan’s national milk output, making investment in the region worthwile.   

Tillo Domor, an Urgench based popular producer of dairy products, will be one of the beneficiaries of the new EBRD, Hamkorbank partnership. 

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Tillo Domor is a well-established operation in Urgench, where the EBRD has just opened its third office in the country.  

Its products have popular appeal across Uzbekistan because of its geographical origin firmly associated with the ancient state of Khorezm, one the world’s most ancient civilisations. 

The dairy producer is set to benefit from a US$0.6 million loan from Hamkorbank. According to EBRD, 65 percent of the risk on the loan will be shared by the EBRD under a risk-sharing framework.   

The loan is supported by the EBRD’s Finance and Technology Transfer Centre for Climate Change (FINTECC) programme financed by the Global Environmental Facility Trust Fund.  

A grant of US$106,200 has also been extended to the dairy to cover energy efficiency measures designed to cut the annual consumption of water by 6,500 cubic metres and help reduce annual CO2 emissions by 368 tonnes though natural gas savings. 

EBRD’s contribution to Uzbekistan’s dairy sector is timely as consumers have been shifting preference to packaged drinking milk products over hygiene fears.

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Cheese is also increasingly becoming popular with a particular boom in mozzarella as Uzbekistan consumers go Italian, leading to growth in soft cheese. 

Multinationals such as Lactalis that have presence in the country have benefiting from this boom in processed milk products. 

Euromonitor however notes that there has been a local cheese production boom as consumers increasingly opt for local companies and smaller craft cheese. 

This presents great opportunity for growth of Uzbekistani’s dairy sector and financial support from EBRD will go a long way in enabling local dairy companies to take advantage of the available opportunities. 

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