EFSD to become fully independent international organization

ArmInfo. The Eurasian Fund  for Stabilization and Development (EFSD) will become a fully independent international organization with the ability to finance  projects and programs in the national currencies of the EFSD member  states. 

The National Assembly of the Republic of Armenia is discussing the  protocol on amendments to the regulations on the establishment of the  Fund, submitted by the RA government for ratification, at a plenary  session on December 3. As RA Finance Minister Vahe Hovhannisyan noted  in his speech, the agreement on the establishment of the EFSD was  signed on June 9, 2009, when the heads of government of Armenia,  Belarus, Kazakhstan, Kyrgyzstan, Russia and Tajikistan signed the  Agreement on the Establishment of the Anti-Crisis Fund of the  Eurasian Economic Community in the amount of $8.513 billion, which  was later transformed into the EFSD. However, as the minister noted,  the fund was not an independent structure; its resources were managed  by the Eurasian Development Bank (EDB). After some time, it became  clear that both structures have their own characteristics, related to  the fact that the EDB mainly finances investment projects in member  states, and the EFSD - programs aimed at regional development.

The EFSD was created to overcome the negative consequences of the  crisis, ensure long-term sustainability and promote the integration  of the economies of the Fund's member states. The Fund provides  financial loans to member states to support budgets and (or) balances  of payments of member states, investment loans to member states or  companies, grants to finance government programs in the social  sphere. Current events have revealed an urgent need to transform the  Fund into a fully independent international organization with the  ability to finance projects and programs in the national currencies  of member states.  Taking into account the above, a draft of updated  statutory documents was developed and submitted for discussion to the  Fund Council, designed to ensure the implementation of the provisions  of the EFSD strategy for 2022-2026 by granting the Fund the status of  an international financial organization.

Currently the total investment volume in the authorized capital of  the fund is $8.513 billion, $1 million of which is in Armenia, $10  million - Belarus, $1 billion - Kazakhstan, $1 million - Tajikistan,  $7.5 billion - Russia and $1 million - Kyrgyzstan. As of now, the  EFSD loan portfolio in Armenia is $840 million, $540 million of which  are in the active implementation stage. In particular, the Fund  provided a loan of $300 million, previously directed to support the  state budget, another $100 million will be attracted for the same  purposes this year. No less important are funds in the amount of  about $150 million directed to the construction of the southern  section of the North-South transport corridor. The Fund also agreed  to provide Armenia with a loan of $200 million for the construction  of the Kajaran tunnel. This project will be implemented with the  participation of other investors. Another $40 million was directed to  the modernization of the irrigation systems of the republic.  Discussions are currently underway with the fund to attract credit  resources for the construction of a reservoir on the Mastara River.  Armenia's application is under discussion.