The Japan Bank for International Cooperation (JBIC) and MUFG have jointly financed the purchase of equipment by Uzbekistan’s biggest telecommunications company to the tune of ¥19.3bn (US$145mn).

Under the agreement, signed on January 27, JBIC will contribute a buyer’s credit of ¥11.6bn (US$87.5mn) while MUFG is lending ¥7.7bn (US$52.8mn). MUFG’s portion of the loan is insured by Nippon Export and Investment Insurance (Nexi), one of Japan’s two official export credit agencies alongside JBIC.

The deal will help state-operated Uzbektelecom to buy telecommunications equipment from Japanese exporter Toyota Tsusho Corporation, with the aim of improving the Central Asian country’s communications infrastructure.

The agreement follows a 2019 memorandum of understanding between JBIC and the Uzbek government on “structuring projects in the Uzbek telecommunications sector”, according to JBIC.

The lender says the deal will further Uzbekistan’s strategy to promote a digital economy and will contribute to “faster speeds and increased capacity”.

“This loan will support the export of high-quality telecommunications-related equipment from Japan, thereby contributing toward the digital transformation initiative in Uzbekistan, and also maintaining and improving the international competitiveness of the Japanese telecommunications industry,” JBIC says in a statement.

JBIC struck a similar deal in 2019, extending around 60% of a Nexi-backed ¥7.8bn loan to allow Uzbektelecom to purchase goods from Toyota Tsusho, however in that instance it was through a credit line to the National Bank for Foreign Economic Activity of the Republic of Uzbekistan and involved SMBC as co-financier rather than MUFG.