Kyrgyzstan, OPEC Fund sign framework agreement on cooperation in private sector

Bishkek, Aug. 26, 2024. / Kabar/. Kyrgyzstan and the OPEC Fund for International Development signed a Framework Agreement on cooperation in the private sector. The signing ceremony was held online.

The Ministry of Economy and Commerce reported that this document establishes the legal basis for interaction with the OPEC Fund on issues of financing projects in the private sector, including:

- Provision of loans and/or guarantees for the implementation of projects.

- Acquisition of shares of companies registered in the host country.

- Borrowing, storage, use and disposal of funds.

- Maintaining accounts in any currency.

The OPEC Fund makes decisions on financing private initiatives based on its own assessment of the project.

The OPEC Fund for International Development is one of the models of multilateral assistance, providing support to developing countries in the following forms:

- Financing of government projects and development programs.

- Support for the balance of payments.

- Co-financing of the private sector.

Framework agreements of a similar nature with the OPEC Fund for International Development have already been signed by countries such as Azerbaijan, Georgia, Uzbekistan, Turkmenistan and Tajikistan. Financing conditions vary depending on risks and market factors and are set individually for each project, starting from 1.5%.

Unlike universal multilateral organizations, the OPEC Fund for International Development is an instrument of a group of countries united by common interests and goals. This fund, playing an important role in the policies of developing countries, is based on the principles of regional cooperation.

OPEC has 11 members. The founding countries of the organization are Venezuela, Iran, Iraq, Kuwait and Saudi Arabia, and full members of OPEC are Qatar, Libya, the United Arab Emirates, Algeria, Nigeria and Angola.

Currently, OPEC member states account for: over 80% of the world's proven oil reserves, 40% of world production and more than 60% of world crude oil exports.

Over the 35 years of its existence, the fund has evolved, responding to new problems and challenges faced by developing countries. Thus, in 1998, a special financial structure was created within the fund to finance the development of the private sector in developing countries - the Private Sector Facility.