MANILA, PHILIPPINES - The Asian Development Bank (ADB) is extending loans of up to $500 million to help Uzbekistan access housing finance for moderate to low-income rural households, to support improved living standards and accelerate development in rural communities nationwide, where 70% of the poor reside.
The ADB Board of Directors today approved the multitranche financing facility for the government's five year Housing for Integrated Rural Development Investment Program, with a first tranche payment of $200 million. The over $3 billion investment program will finance more than 40,000 new houses across rural communities nationwide, channeling household savings into investment in rural construction to create jobs.
The program will increase the capacity of local government staff to prepare and carry out effective rural development and investment promotion plans, and support policy reforms that will accelerate private sector development and the establishment of micro and small rural businesses. Coordinated expansion and improvement of rural infrastructure and social services will improve rural living standards, and help address key constraints to home-based micro and small businesses and cottage industries often run by women.
"The goal is to achieve greater inclusive economic growth, and improved rural living standards nationwide. Transparent targeting of rural homebuyers will be implemented to reach critical skilled professionals - teachers, doctors and nurses, and entrepreneurs - much needed to advance social welfare in rural areas and stimulate growth," said Elaine Glennie, Principal Public Management Specialist in ADB's Central and West Asia Department.
The loans from ordinary capital resources will be released in up to four tranches, with the first having an 18-year term, a 3-year grace period, and an interest rate set in accordance with ADB's LIBOR-based lending facility. Counterpart financing for the program will total over $2.5 billion, including down payments from rural homebuyers, and contributions from the Government of Uzbekistan, participating commercial banks, and the private sector. The Ministry of Economy will carry out the program, which is due for completion in December 2016.