Horticulture cluster - storage and processing within the framework of the RKDF direct funding

Purpose:

Growth in horticulture production and increase of the export potential of the Kyrgyz Republic in this area.

Target borrowers:

Commercial companies of various organizational and legal forms that are residents of the Kyrgyz Republic and have experience in any of the following areas:

  • horticulture processing;
  • storage, distribution or sale of horticulture products (logistics center);
  • growing of horticulture by logistics centers or processing enterprises in order to provide the own raw material base;
  • production of organic and mineral fertilizers;
  • production of succulent feed;
  • organization of greenhouses;
  • machine and tractor stations.

Target-oriented loan disbursement:

Investment objectives:

  • Purchase of equipment, machinery and units for the implementation of projects of technical re-equipment, modernization and expansion of existing production or creation of a new production, including indirect costs under the relevant contracts (costs of paying customs duties, taxes and fees; costs of engineering, installation supervision, construction, installation and commissioning; costs of spare parts; costs of personnel training, involvement of specialized independent experts, etc.);
  • Execution of construction and installation work related to the construction, reconstruction or technical re-equipment of facilities (including production facilities, engineering and transport infrastructure, greenhouses, trellis systems and irrigation facilities);
  • Funding of expenses for the acquisition of real estate objects (land plots, buildings and structures for industrial and/or agricultural purposes).

Current assets funding:

  • Purchase of raw materials, seeds, POL and fertilizers;
  • Purchase of spare parts for production equipment, agricultural machinery and transport;
  • Purchase of materials (including containers for transportation);
  • Payment of logistics costs.

Loan rescheduling:

In exceptional cases, a loan may include a rescheduling component. The rescheduling component, including refinancing loans from other banks, must not exceed 30% of the loan amount, and can be provided subject to the following conditions being met:

1. the rescheduled loan was used for investment purposes and is associated with the ongoing project;

2. the target-oriented disbursement of the rescheduled loan is confirmed by the relevant documents for the transaction (account statements, contracts, invoices, customs declaration, waybill, certificate of completion, certificate of acceptance);

3. rescheduled loan availability period is at least 6 months at the time of the application review;

4. no overdue payments on the rescheduled loan principal and interest;

5. . the absence of revolving debt rescheduling due to a worsening financial situation or debt servicing (loan principal and interest repayment), unless otherwise decided by the RKDF Board.

At the same time, the total amount of all loans with refunding should not exceed 30% of the total funding limit within this program.

Refunding of loans provided by financial institutions other than banks is prohibited.

Borrower own contribution:

For investment loans at least 15% of the project cost, for project funding (greenfield projects) - at least 20%.

Funding currency:

· Kyrgyz som;

· U.S. dollars.

Funding amount:

  • from 100 thousand US dollars (or the equivalent in Kyrgyz soms) in Talas, Batken and Naryn regions.
  • from 200 thousand US dollars (or the equivalent in Kyrgyz soms) in other regions and remote areas of the Chui region.
  • In the city of Bishkek and nearby districts of Chui oblast, the minimum threshold is 1 million US dollars

Loan term

Investment purpose (in accordance with the RKDF Lending Policy):

- agro-industrial complex up to 7 years;

- processing industry - up to 7 years. In exceptional cases of complex technological solutions - up to 10 years;

- horticulture – up to 10 years.

Current assets funding - up to 3 years.

Exemption period:

Investment purpose – up to 30 months;

Loans for horticulture – up to 36 months. 

Current assets funding - up to 6 months.

Interest rate:

Kyrgyz som - 8% per annum (excluding the loan rescheduling rate - 10%).

US dollars - 4% per annum (excluding the loan rescheduling rate - 6%).

Requirements for the applicant

For processing enterprises:

· Sales contract with a customer;

· The project should include the food safety standards application;

· Availability of qualified production and commercial personnel (technologist, engineers, marketers, etc.).

For vegetable stores, logistics centers:

· Contract for the sale of stored crops or a letter of intent for the purchase of stored crops for newly established logistics centers;

· Designed storage capacity of at least 500 tons of fruits and vegetables;

· Design documentation.

For greenhouses and horticulture:

· Sales contract.

Collateral security requirements

· real estate;

· movable property (equipment, machinery);

· assets received during the project implementation;

· guarantee of OJSC "Guarantee Fund".

· contract claim right.

The collateral coverage ratio in the industrial phase should be at least 80% of the loan amount, while the collateral coverage ratio set before the first tranche issuance should be at least 50% of the loan amount.

The collateral is subject to insurance in accordance with the RKDF requirements. The Fund must be listed as the Beneficiary in insurance policies in order to receive insurance compensation.

The rights of claim under the contract considered as collateral at zero cost.

Technical assistance to the applicant

At the stages of the project preparation and implementation, it is possible to provide technical assistance on a grant basis for hiring consultants for the project assistance.

In this case, the Applicant covers part of the costs from the own funds in the amount of at least 15%.