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Kyrgyz leader says Russia unable to finance hydropower projects
December 24, 2015 / 12:28 PM / 2 years ago

Kyrgyz leader says Russia unable to finance hydropower projects

BISHKEK (Reuters) - Kyrgyz President Almazbek Atambayev said on Thursday Russia would no longer be able to finance two previously agreed hydroelectric power projects in Kyrgyzstan, its close Central Asian ally.

Atambayev’s announcement underscored a decline in Russia’s economic power as a result of the slump in oil prices. This, in turn, is prompting its ex-Soviet neighbors to turn to other big players such as China in search of loans and investments.

Atambayev said Kyrgyzstan, which hosts a Russian air base, would seek new partners for two power projects on the Naryn river, Kambarata-1, worth $2.5 billion, and Upper Naryn Cascade, estimated to cost $734 million.

“...it is clear that in the current situation, when Russia’s economy is not on the rise and the oil price trend is negative, Russia, I think, will not be able to fulfill these agreements for objective reasons,” he told a briefing, adding that he had discussed the issue with Russian President Vladimir Putin.

“The reality is such that today, unfortunately, our Russian friends will not be able to implement these projects... And this is going to be the case for a long time.”

Kremlin spokesman Dimtry Peskov confirmed that the issue had been discussed during Atambayev’s visit to Moscow this week.

“Indeed, there are difficulties of commercial and conjunctural nature, different options are being discussed,” he said. “Conjunctural issues are issues related to the world economy, budget parameters, financial parameters.”

Reporting by Olga Dzyubenko; Additional reporting by Anastasia Lyrchikova and Maria Tsvetkova in Moscow; Writing by Olzhas Auyezov

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