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Results snapshot Turkey

THE EBRD IN Results snapshot 2015-20

In numbers Overview 1994-2020 2015-20

The EBRD has been active in Kazakhstan since 1993 and the country has been one of €7.95 billion €2.29 billion the largest recipients of the Bank's investment. During that time, the Bank has Net cumulative investment* supported clients in the energy, infrastructure, financial and corporate sectors. Total EBRD investments have amounted to nearly €8 billion, with €2.29 billion invested 280 Number of projects 98 between 2015 and 2020 alone, amid growing opportunities to intensify the EBRD’s engagement in the country. 53% Private-sector share of cumulative investment The Bank’s strategic focus in Kazakhstan is on: ► the green economy transition and renewable energy €2.19 billion €1.37 billion ► transport infrastructure and municipal services Green economy financing commitments ► private-sector development, small and medium-sized enterprises (SMEs) and competitiveness. €1.87 billion € 961million The EBRD is also increasingly focused on economic inclusion by enabling wider Volume of co-financing directly mobilised access to better infrastructure, finance and skills. In response to the Covid-19 crisis, the Bank provided €195 million in funding (as of December 2020) to support Our policy engagement corporate and financial-sector resilience, sustain trade and maintain infrastructure ► Green economy transition and legislation and energy services. ► Legal framework for PPPs

► Environmental and social standards, tariff- Highlights of setting mechanism and commercialisation in More renewable energy regulated sectors our results The EBRD financed an increase in renewable energy capacity by an estimated ► Economic inclusion, gender equality and 2015-20 687 MW, representing almost half of all skills development renewable energy capacity in the country. ► Capital and money markets Greater local The annual CO2 reductions from this currency financing capacity are expected to reach at least ► Investment attractiveness 980,000 tonnes. The majority of the newly The EBRD provided the ► Collaboration with the Astana Financial installed capacity (463 MW) is financed equivalent of €2.23 billion in Services Authority to establish crowdfunding through the EBRD's Renewables Framework. local currency to local banks and rules and a regulatory framework for mobile corporations. A successful public-private and digital banking services SME growth partnership (PPP) The EBRD aided the disbursement of over With an updated legal and regulatory > Read the latest country a million loans to SMEs via partner banks, framework for PPPs in Kazakhstan, strategy for Kazakhstan: including 22,000 loans under the Women the 66 km ring road (BAKAD in Business programme. It offered PPP) is the first concession road business advice to over 1,100 SMEs, of project of its kind in the country. which 54 per cent raised turnover and 60 *Stock of all EBRD commitments less their sale or cancellations. per cent reported higher productivity. We seek to help countries transition Kazakhstan in context towards democratic and sustainable market economies. We finance Kazakhstan’s economy has unique characteristics: an abundance of natural resources, a vast projects that strengthen the private landlocked geography, a relatively small population and proximity to both and sector in economies undergoing China. Before the Covid-19 crisis, annual gross domestic product (GDP) growth averaged transition to a well-functioning more than 5 per cent, with income per capita approaching that of some European Union market system. Our investment (EU) countries. The government has made progress on the longer-term diversification of decisions are guided by six the economy and its renewable energy reform agenda. “transition qualities”, which focus on However, Kazakhstan remains vulnerable to global commodity price shocks, as extractive making economies competitive, sectors continue to play a key role in the economy. Boosting private-sector competitiveness well- governed, green, inclusive, in non-extractive industries would increase the country’s resilience. The assets of state- resilient and integrated. owned enterprises constitute as much as 40-50 per cent of GDP in Kazakhstan. In particular, firms owned by Samruk-Kazyna, Kazakhstan’s national holding company, retain a For more detail on our significant stake in many important sectors of the economy, such as mining, transportation transition qualities visit www.ebrd.com/qualities and telecommunications, while the state also has a strong presence in the agricultural sector. The SME sector remains comparatively small and less productive than in Organisation of Economic Co-operation and Development (OECD) countries. Further steps are also needed EBRD score,1 2020 to strengthen the financial sector, particularly in the post-Covid-19 period, and to boost (1-worst, 10-best) regional connectivity, economic opportunities and inclusive growth. Competitive

Green

Inclusive Key economic indicators Kazakhstan OECD comparators2 Integrated 2015 2020 2020 Resilient GDP per capita, PPP (current international US$) Well-governed 24,290 26,351 50,413 0 2 4 6 8 10 Electricity production from renewable sources, 0.16 3.0 11.0 Kazakhstan excluding hydroelectric (% of total) OECD comparators Labour force participation rate, female (% of Central Asian average female population aged 15-64) (modelled 73.2 71.5 73.0 ILO estimate) Unemployment, total (% of total labour EBRD investment 2015-20 4.9 4.6 5.0 force) (modelled ILO estimate) € million Number 35 Unemployment, youth total (% of total labour 3.8 4.0 11.0 1000 force aged 15-24) (modelled ILO estimate) 30

25 800 Our approach and operational delivery 20 400 15 The EBRD supports the development of the private sector through a combination of investment, policy dialogue and technical assistance. We offer a range of financial 10 200 instruments, both directly and through partner financial institutions. In addition, we 5 provide business advisory services and technical assistance to help improve the 0 0 institutional capacity of our clients. In our policy engagement work, we address a range of 2015 2016 2017 2018 2019 2020 factors to help shape initiatives that create favourable conditions for sustainable and Annual business investment Number of projects inclusive economic growth. From 2015 to 2020, the EBRD invested nearly €4 billion in Kazakhstan, mostly in Portfolio by sector sustainable infrastructure. Its investment has increased significantly since 2017, reflecting the challenges of and opportunities in Kazakhstan and, in particular, the Bank’s support Sustainable infrastructure, for the green transition, strengthening financial-sector resilience and investment in 67% sustainable infrastructure. In response to the Covid-19 pandemic, it rapidly increased its support. The EBRD also supported its Kazakh clients by developing guidance materials on how to manage issues related to health and safety, labour and stakeholder engagement during the pandemic.3 The Bank mobilises high levels of donor finance, including from the EU. As well as being a country where the EBRD invests, Kazakhstan is an EBRD donor. To date, the Kazakh government has contributed €64 million to support the EBRD’s Women in Business programme, business advisory services and in-country policy Industry, commerce Financial institutions, and agribusiness, 6% dialogue objectives, with a primary focus on transport, municipal infrastructure, 27% telecommunications and energy efficiency.

1 For details see https://www.ebrd.com/economic-research-and-data/transition-qualities-asses.html. 2 OECD comparators are a simple average of eight OECD countries: Canada, the United States of America, the United Kingdom, Sweden, France, Germany, Japan and the Czech Republic. Data relate to EBRD activities in Kazakhstan between 3EBRD's hublet on sustainability and Covid-19: https://www.ebrd.com/sustainability-covid.html. 2015 and 2020. EBRD-financed solar plant in Chulakkurgan

THE EBRD IN KAZAKHSTAN

Related SDGs

Green economy transition, EBRD Green Cities and renewable energy

2015-20

EBRD score Kazakhstan is the largest emitter of greenhouse gases in , (1-worst, 10-best) registering one of the highest CO2 intensities in the world. More than 70 CO₂ emissions per cent of Kazakhstan’s electricity is produced in ageing coal-fired plants, from residential served by large volumes of cheap local coal, in the north-east of the country. buildings Consequently, the energy sector, in particular power and heat generation, CO₂ emissions from transport accounts for 80 per cent of the country’s carbon emissions. With rapid Electricity economic growth and increasing electricity and energy demands, it has production become essential for Kazakhstan to invest in a more decentralised, balanced from renewables and environmentally friendly energy supply system that includes a range of Environmental technology renewable resources. Therefore, Kazakhstan has embarked on building a green patents economy, leading the charge among its Central Asian neighbours. 0 1 2 3 4 5 6 Kazakhstan OECD comparators Central Asian average

How we work In numbers (2015-20) Quick links > Green Economy Transition The EBRD promotes a shift to more €1.37 billion environmentally friendly energy supply Green economy financing > Green Economy Financing systems and performance by investing in commitments Facility municipal sectors, renewables, energy- > Green Climate Fund efficient technologies and resource 15 efficiency. We combine investments with Renewable energy projects (with policy dialogue to develop a good €237 million in operating assets) regulatory framework for sustainable energy, water and resource use. Through EBRD Green Cities, we support €237 million EBRD Green Cities offers more than €2.5 municipalities in developing Green City Cumulative disbursements under the billion of EBRD and donor support to Action Plans to address key GEFF and Renewables Framework address cities' most pressing environmental environmental challenges and to invest in challenges through sustainable infrastructure. The EBRD also investment, policy actions provides green credit lines via partner and capacity-building in banks, such as the Green Energy the economies where the Financing Facility (GEFF), which uses the EBRD invests. Green Climate Fund to provide technical advice to lenders and borrowers.

Data relate to EBRD activities in Kazakhstan between 2015 and 2020.

resilience proje cts . Achievements and results: Green economy transition, EBRD Green Cities and renewable energy Increased renewable energy We promoted energy efficiency and in the energy mix increased renewable energy by: The EBRD is helping to gradually shift power generation from coal and gas by ► improving legislation on renewable energy ► promoting women's access to green financing an increase in renewable energy to develop carbon markets, introducing finance and green entrepreneurship (for capacity by an estimated 687 MW, renewable energy auctions and developing a example, through gender activities under corresponding to almost half of the green financial system approach with the the GEFF and the Kazakhstan Renewables country’s renewable capacity. Most of the Astana International Financial Centre Framework). newly installed capacity (463 MW) is financed through the EBRD's Renewables Framework. ► financing the first solar power plant A level playing field for (Burnoye Solar) under the country’s new more competition renewable energy legislation, supported by EBRD advice helped the government to the Clean Technology Fund as one of the abandon its local-content premium to country's first privately owned renewable attract private investors to the renewable energy generators energy sector and to improve the likely financial success of power purchase ► investing and partnering with private co- agreements. financiers (such as investors from the United Kingdom, France, China and The EBRD’s Kazakhstan Germany) to improve the electricity grid Energy saved Renewables Framework for renewable energy projects An estimated 9.5 million GJ/year of energy received an award for its was saved through EBRD-supported solar contribution to the power investments, corresponding to the We helped to reduce vulnerability electricity use of more than 300,000 homes development of a green to climate change and address for one year. financial system in the environmental challenges by: country at the Nur-Sultan International Financial ► financing the shift from coal to more ► supporting companies in improving their Centre Finance Awards. sustainable alternatives, for example, by operational efficiency and compliance, for supporting the modernisation of the gas example, through ozone-friendly network to enhance gasification while hydrocarbon refrigerators for Caspian reducing pollutant greenhouse-gas Beverage Holding. emissions and methane leaks and supporting tariff reform in the sector Greener cities Cleaner air Over 3.4 million people in southern and ► launching EBRD Green Cities in four cities EBRD-supported gas modernisation eastern Kazakhstan are expected to benefit (Almaty, Semey, and Ust projects have led to an estimated 2.5 from cleaner cities and sustainable Kamenogorsk) to address environmental million-tonne reduction in CO2 infrastructure under the EBRD Green challenges by developing Green City emissions and 2.7 million tonnes of coal Cities programme. Action Plans and undertaking saved from burning, equivalent to removing more than 500,000 cars from infrastructure investments, policy actions the road for one year. and capacity building

Supporting a low-carbon transition in Reducing energy loss in and : The EBRD financed the construction Petropavlovsk: The EBRD supported the and grid connection of an 11MW installation of more than 16,100 smart cogeneration gas-engine-based power plant in meters across the northern cities of Atyrau, introducing new high efficiency and Pavlodar and Petropavlovsk, contributing low carbon distributed generation technology. to a reduction in electricity losses (of 6.3 The grid has achieved an electric efficiency per cent on average) and increase in improvement of more than 40 per cent, and is collection rates. estimated to reduce carbon emissions by more than 40,000 tonnes of CO2 per year. Increasing renewable energy in Chulakkurgan: Under the Kazakhstan Making cement production more energy Renewables Framework, the EBRD financed efficient in Shymkent: The EBRD financed a 50MW greenfield solar project in the rural new dry lines and alternative fuels to Chulakkurgan district. The project is transform a local cement plant and make it supporting the entry of a new private the most energy-efficient plant in the country. The Bank also engaged in policy player into the Kazakh power market and dialogue with the Kazakh cement industry is expected to contribute to annual CO2 and authorities to set higher environmental savings of 68,000 tonnes. standards in the sector.

Data relate to EBRD activities in Kazakhstan between 2015 and 2020. EBRD-financed ring road, Almaty

THE EBRD IN KAZAKHSTAN

Related SDGs Transport infrastructure and municipal utilities

2015-20

EBRD score As the world's largest landlocked country, Kazakhstan needs good transport (1-worst, 10-best) links to unleash its full economic potential. The country faces large Municipal infrastructure needs to keep up with its expanding economy and population. In waste collection addition to traditional sovereign and sub-sovereign financing, major coverage infrastructure projects have attracted private investments, including through public-private partnerships. Despite progress, the current state of physical Quality of electricity supply infrastructure and institutional arrangements in the transport and municipal sectors remains a bottleneck to Kazakhstan's economic development and Quality of transport and requires further capital investment and greater sustainability. trade-related infrastructure 0 2 4 6 8 10

Kazakhstan OECD comparators Central Asian average

How we work In numbers Quick links > Infrastructure Project The EBRD promotes connectivity, regional €1.40 billion Preparation Facility (IPPF) integration and economic inclusion by Net cumulative EBRD investment in sustainable investing in transport infrastructure and infrastructure attracting private investment to the sector. The Bank also invests heavily in municipal €248 million services, such as water, wastewater, Net cumulative EBRD investment in municipal and environmental electricity and gas. Most of the Bank’s infrastructure projects in the municipal infrastructure sector are associated with policy advice and technical assistance aimed at improving the efficiency of public utility companies. The The EBRD’s Infrastructure Project Bank’s flagship programme, EBRD Green Preparation Facility focuses on project Cities, offers more than €2.5 billion of preparation, policy dialogue and EBRD and donor support to cities to institutional strengthening to address address their pressing environmental both public-sector challenges through targeted sustainable infrastructure projects infrastructure investments, policy actions and PPPs. and capacity building.

Data relate to EBRD activities in Kazakhstan between 2015 and 2020. Achievements and results: Transport infrastructure and municipal utilities

We helped to improve the quality and management of roads by: Improved ► developing PPPs and improving the procurement transparency PPP legal framework, leading to the EBRD advice led to an improvement success of the country’s first ever road in procurement standards for construction and investment in road concession project, the 66 km ring road maintenance equipment. in Almaty (BAKAD), the largest PPP in Central Asia ► supporting the national road agency with Better connectivity See how the EBRD promotes a view to better managing road The EBRD supported the rehabilitation safe and sustainable roads in construction, maintenance and repair; of more than 220 km of road connecting Kazakhstan. Nur-Sultan and Almaty. supporting road-sector reform, such as tolling, better procurement and planning for new funding sources

► increasing road capacity and safety standards by financing the reconstruction of the Atyrau-Astrakhan road, as well as sections of the corridor connecting Nur-Sultan to Almaty. We helped improve the quality and sustainability of municipal services by:

► supporting the modernisation of water and wastewater, district heating and More sustainable water electricity distribution infrastructure in sector eight regional capitals across Average water rates increased by 161 Kazakhstan (, , , per cent and wastewater costs soared Ust-Kamenogorsk, Semey, by 309 per cent between 2010 and Petropavlovsk, , and 2018 in Shymkent, generating Read how the EBRD works Shymkent) to enhance operational resources for investment and improving to improve and renovate services. efficiency and service quality water supply systems across ► supporting the modernisation of street Water efficiency the country. lighting in East Kazakhstan (Ust- EBRD water projects have saved Kamenogorsk) to reduce power 127.5 million m³ of water per year, consumption, by installing more energy- equivalent to 50,000 Olympic-sized efficient equipment and introducing new swimming pools. management systems.

Improving access to urban transportation Improving regional connectivity along in Ust-Kamenogorsk: The EBRD, in an the Nur-Sultan-Almaty corridor: The integrated approach to the urban transport EBRD is investing in the reconstruction of sector, provided investment and policy the 228 km section of the Nur-Sultan support to improve private-sector Almaty road and spearheading key road- participation in the sector and revenue sector reforms, including support for the collection on public transport and to make government’s decision to privatise the energy efficiency improvements. state-owned maintenance monopoly.

Improved wastewater provision in Shymkent: Over the years, the EBRD has Improving connectivity in Almaty: In a supported wastewater services in the third- public-private partnership, the EBRD co- largest city in Kazakhstan by rehabilitating financed the construction and operation of a treatment facilities that now meet EU toll bypass around Almaty, supporting greater standards on energy efficiency and by private participation in infrastructure constructing a biogas plant to reduce development and management and helping to energy consumption. The Bank also helped alleviate congestion and pollution by diverting the authorities to introduce more cost- heavy vehicle traffic. The project will build 66 reflective tariffs to ensure more sustainable km of road infrastructure around the city. delivery of water and wastewater services in Shymkent.

Data relate to EBRD activities in Kazakhstan between 2015 and 2020.

Data relate to EBRD activities in Kazakhstan between 2015Data and relate2020 to EBRD activities in Kazakhstan between 2015 and 2020 EBRD-supported food producer RG Brands

THE EBRD IN KAZAKHSTAN

Related SDGs Private sector development, SMEs and competitiveness

2015-20

EBRD score Kazakhstan has reacted to the difficult economic environment caused by the (1-worst, 10-best) volatility of oil prices by accelerating the implementation of pressing structural reforms. However, a number of major challenges remain. These include the need EBRD SME index to boost private-sector competitiveness to generate balanced, sustainable growth EBRD Knowledge that extends beyond Kazakhstan’s hydrocarbon resources and increase the Economy index country’s resilience. Further steps are also required to reduce the state’s still- Competition Law, outsized role in the economy, develop the banking sector as a financial platform Institutions and Enforcement and boost regional connectivity and inclusion. Moreover, more needs to be done index to ensure adherence to good business standards to create a more vibrant and Skills (WEF) competitive private sector, particularly in the non-extractive industries. 0 2 4 6 8 10

Kazakhstan OECD comparators Central Asian average

How we work In numbers Quick links The EBRD works to enhance > Advice for Small Businesses competitiveness by promoting a better €2.2 billion programme balance between the public and private Total local currency financing sectors, improving corporate governance provided by the EBRD > Blue Ribbon programme and supporting the growth of private firms. > EBRD Star Venture programme We seek to increase SMEs’ productivity by €71.4million improving access to finance through debt Amount of EBRD Women in Business programme funding provided to local and equity financing, credit lines and local banks (in local currency) currency financing. Our work includes targeted programmes, such as Women in 1,296 Business, or advisory services through the SME advisory projects delivered The EBRD Women in Advice for Small Businesses (ASB) and Business programme Blue Ribbon programmes. Recently, most provides finance, of the EBRD’s loans to Kazakhstan have Over 1 million business advice, training been in local currency, reducing recipients’ SME loans disbursed via EBRD partner banks and mentoring to female- foreign-exchange rate risk and improving led SMEs. the creditworthiness of clients that generate local currency income.

Data relate to EBRD activities in Kazakhstan between 2015 and 2020. Achievements and results: Our case study: Private-sector development, SMEs and competitiveness Towards equal opportunities for all in Kazakhstan's energy We helped to improve access to finance SME growth and SME skills, also for women, by: and mining sectors Fifty-four per cent of SMEs advised by the ► working with six partner banks and EBRD hired more people. In total, 7,613 microfinance institutions on providing new jobs were created. Seventy-two per cent more than 22,000 loans to of SMEs increased their turnover. Overall, women-led micro, small and the Bank's advisory services contributed to medium-sized enterprises (MSMEs) €748 million of additional turnover.* through the Women in Business programme Exports and productivity

► providing advice and finance in remote SMEs advised by the EBRD grew their areas, for example, through an SME exports by a total of €65 million. Sixty-two education and consultancy e-platform per cent of them became more productive.* with Accenture Development Women entrepreneurship ► supporting women entrepreneurs More than 1,000 women accessed EBRD-led through mentorship outreach educational and coaching programmes. programmes. Watch how the EBRD We promoted better public helped a Kazakh beverage governance by: Better skills producer expand into new ► advising the government on improving markets to double its sales skills and employment opportunities We helped strengthen the national qualification framework with the approval and triple exports. (for example, by developing national of four national occupational skills occupational skills standards and standards and improved skills standards for removing 75 of 287 positions from the 22 professions in the power and mining list of jobs banned for women) sectors. ► improving the corporate governance of the state-owned enterprises (such as the Better corporate governance Samruk-Kazyna National Welfare The EBRD advised Samruk-Kazyna on the Fund) adoption of a corporate governance plan ► improving arrangements for the for the equal treatment of shareholders and private operation of services in Nur- better board composition. Sultan's logistics hub through a service management contract (Express Sakura). We helped to improve financial resilience by: ► ► advising (the National Bank, the working with the Agency for Banking Kazakhstan Stock Exchange and financial Sector Regulation and local banks to market participants) on money-market address non-performing loans (NPLs). reference rates, leading to the reform of the tenge (KZT) overnight interbank average rate (TONIA) to support the Stronger banking sector development of a broader set of products The EBRD helped to improve the existing for financial-sector participants framework and to draft legislation on ► training regulators and practitioners on derivatives and bankruptcy rules. legislation for derivatives, drafting a legal framework for derivatives and repos and advising the government and the Astana Banking skills International Financial Centre (AIFC) on More than 700 loan officers from partner the transition to emerging-market status financial institutions were educated on gender awareness and SME lending. ► issuing the equivalent of €1.9 billion in local currency bonds (in 31 transactions). All issues were in Eurobond format and included inflation-linked transactions, primarily targeting the Kazakh Unified Pension Fund *within a year of the advisory project ending. Data relate to EBRD activities in Kazakhstan between 2015 and 2020. Results snapshot of Kazakhstan

Partnerships The EBRD supports the transition process by combining investment and close policy dialogue with local and central governments, regulators, financial institutions and representatives of civil society, providing technical assistance and advisory services using funds donated by governments and institutions. Donor funds play a vital role in ensuring the success of these activities and act as a catalyst or enabler for our investment.

Our partnerships in action

► The EBRD, in partnership with the Climate ► In the largest PPP deal in Central Asia, ► Most projects under the EBRD's Investment Funds and Global Environment the EBRD provided a financing package, Renewables Framework see significant Facility, has helped strengthen the country's alongside the Bank of China, Dutch foreign direct investment flows from major enabling environment, facilitated growth in pension fund PGGM, the Eurasian investors in the United Kingdom, France, capacity and investment in the renewables Development Bank and the Islamic China and Germany. The framework was sector and encouraged industrial and Development Bank, for the BAKAD road in extended by €300 million, supported by the resource efficiency. Almaty. Green Climate Fund. ► We co-financed a US$ 140 million wind farm near the town of Zhanatas, with the Asian Infrastructure Investment Bank, Donors: Austria, Finland, Japan, Kazakhstan, South Industrial and Commercial Bank of China Korea, Taipei China, the United States of America, and the Green Climate Fund. the EU, Climate Investment Funds, the Green Climate Fund and the Global Environment Facility

Work with us Contacts Country facts Financing Goods and services Agris Preimanis, EBRD Head of Kazakhstan 27 July 1992 -Loans - Procurement Joined the EBRD - Equity - Guarantees (including to - Careers EBRD Kazakhstan offices local banks for 41 Kazybek Bi st., Park Palace Business Centre, 3-rd trade finance) Almaty €69,020 Participate Entrance, 3rd Floor, 050010 Almaty; Tel: +7 727 332 00 00 - NGO roundtable Capital subscription (€ 000) Advice - Have your say on EBRD Nur-Sultan 2 Dostyk st., 10th Floor, Yesil dist., Nur-Sultan; - Expand policies and strategies Tel. +7 7172 554246 - Improve processes and Aktobe 173/1 Sankibay batyr ave, Progress Business Centre, governance Alikhan Smailov - Meet standards Off.301 Aktobe 030012; Tel: + 7 7132 703 841 EBRD Governor - Navigate regulatory 31 Voinov-Internacionalistov str., Asia Business environment Centre, Off.415; Tel.: +7 (7212) 412023 - Train workers Kostanay 65 Al-Farabi Av., Business Centre ‘Коstanay’, Asset Madi Takiev Room 1207; Теl.: +7 (7142) 593221; 593220 EBRD Alternate Governor Ust-Kamenogorsk 21 M.Gorkogo str., Business Centre More information ‘Antares’, Room 208; Теl: +7 (7232) 269129 Leander Treppel > EBRD in Kazakhstan Shymkent 17 Zheltoksan str., Rixos Khadisha Shymkent EBRD Board Director Hotel, business block, 3rd floor; Теl: +7 (7252) 997194

New business enquiries Business Development Department Tel: +44 20 7338 7168 email: [email protected]