Kazakhstan’s state-owned railway operator, Joint Stock Company National Company Kazakhstan Temir Zholy ( KTZ ), has signed a loan amounting to US$300 million with IFC, Asian Infrastructure Investment Bank ( AIIB ), and Standard Chartered.

The financing, comprising US$50 million from IFC, an AIIB loan of US$150 million, and US$100 million from Standard Chartered will fund the construction of the 130-kilometre electrified Almaty Railway Bypass.

Standard Chartered’s participation will be supported by a guarantee from the Multilateral Investment Guarantee Agency ( Miga ).

The long-term financing aims to improve logistics efficiency in Kazakhstan, strengthen trade and competitiveness, and enhance regional connectivity, IFC says. The bypass is expected to reduce congestion around Almaty by more than 40%, cut delivery times by up to 24 hours, and improve freight flows along the Trans-Caspian Transport Corridor ( TCTC ), also known as the Middle Corridor, an overland route linking China and Central Asia to the Caspian Sea and onwards to Europe.

As the TCTC grows as an alternative route from Asia and Central Asia to Europe, congestion has intensified, underscoring the need for targeted infrastructure investments.

“The Almaty Railway Bypass will be a pivotal upgrade for our network, unlocking capacity and reducing congestion around Almaty. It will enable KTZ to handle growing long-haul freight volumes more efficiently, strengthen the resilience of regional logistics, and enhance the competitiveness of the Trans-Caspian Transport Corridor as a reliable bridge between Asia and Europe,” says KTZ chief financial officer Dair Kusherov.

Model for upcoming projects 

The project represents a major milestone in the collaboration between international financial institutions and KTZ on rail infrastructure financing. It sets a model for upcoming railway projects in the country, including strong financial and operational due diligence, high environmental and social standards, and the use of guarantees to mobilize private capital.

“Strengthening Kazakhstan’s transport backbone is essential for supporting the country’s long-term growth and its role as a key connectivity hub across Eurasia”, says Konstantin Limitovskiy, chief investment officer, public sector ( Region 2 ), project and corporate finance ( global ) clients, at AIIB. “The Almaty Railway Bypass Project removes one of the most significant bottlenecks in the national rail system, enabling faster, cleaner and more reliable freight movement.”

“Miga’s non-honouring credit enhancement guarantee for Standard Chartered is intended to unlock longer-tenor commercial lending and mobilize private capital for KTZ,” says Muhamet Bamba Fall, Miga’s director of industries. “Once finalized, the proposed guarantee would be Miga’s second credit-enhancement guarantee supporting KTZ’s access to international commercial lending to finance its investment programme, which aims to enhance Kazakhstan’s role as a regional transit hub along the Middle Corridor, therefore, strengthening regional connectivity.” 

Initiated in 2024, the World Bank Group guarantee platform consolidates guarantee products and experts from across the World Bank Group at Miga. It provides a simplified and comprehensive menu of guarantee solutions, enabling clients to select the instrument that best suits their needs. The platform streamlines processes, removes redundancies, and provides greater accessibility by de-risking investments in developing countries.