31 May 2022 15:22

Russian-Kyrgyz Development Fund could invest record $90 mln in 2022, to start buying corporate bonds

BISHKEK. May 31 (Interfax) - The Russian-Kyrgyz Development Fund intends to invest $90 million in new projects in 2022, the Fund's press office said.

"We aim to increase the Fund's project portfolio, allocating a record $90 million for new projects in 2022 alone," said Timur Maksimov, a deputy Russian finance minister who chairs the Fund's board of directors.

Maksimov said the Fund would start to invest in corporate bonds. "The Fund has not previously had such a mandate, but now we have managed to agree terms and to decide how much can be invested in this sector. The Fund will be developing this segment," he said.

The Fund's board has determined the parameters, level of risk and limits for purchasing bonds from specific borrowers. "We'll see how this model starts to function, and then decide whether to take it forward both from the point view of raising limits and broadening the range of issuers from which we can buy bonds for the Fund," he said.

Artem Novikov, the Fund's CEO, said a "provision allowing the Fund to invest in corporate bonds will the catalyst for this sector's development." "Digital transformation and investment in IT products will be another area for the Fund, one that will require deeper and lengthier consideration. The first steps here are already being made, we are working on a strategic document and plan of action for 2023-2027," he said.

Novikov also said the Fund had proven a reliable and valuable partner for entrepreneurs in 2021. "The combined sales revenue of enterprises financed by the Fund rose 28% last year to 59 billion som or $710 million, and 8% of GDP. Tax receipts grew 20%, by 1.2 billion som or $14.4 million. But of particular importance was the growth of exports by 60% overall, and by nearly three-fold to Russia," he said.

The Fund's board of directors met in Bishkek in person for the first time in two years on May 29 to assess last year's results and determine plans for the current year.

The Fund as set in line with an agreement between the Russian and Kyrgyz governments in 2014 to promote economic cooperation between the countries, to modernize and develop Kyrgyzstan's economy and to take advantage of the opportunities afforded by Eurasian economic integration.