European Bank for Reconstruction and Development
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Founded in 1991, the European Bank for Reconstruction and Development (EBRD) uses the tools of investment to help build market economies and democracies in 27 countries from central Europe to central Asia.
The EBRD is owned by 61 countries and two intergovernmental institutions. Despite its public sector shareholders, it invests mainly in private enterprises, usually together with commercial partners.
EBRD provides project financing for banks, industries and businesses, both new ventures and investments in existing companies. It also works with publicly owned companies to support privatization, restructuring state-owned firms and improvement of municipal services.
The EBRD’s mandate stipulates that it must only work in countries that are committed to democratic principles. The EBRD is directed by its founding agreement to promote, in the full range of its activities, environmentally sound and sustainable development.
Erik Berglof is the Chief Economist
The following countries are members and recipients of investments:[1] Albania, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Estonia, Georgia, Hungary, Kazakhstan, Kyrgyzstan, FYR Macedonia, Moldova, Mongolia, Montenegro, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Tajikistan, Turkmenistan, Ukraine and Uzbekistan.
The following countries are financing members only: Australia, Austria, Belgium, Canada, Cyprus, Czech Republic (receiving member until 2007-12-31[2]), Denmark, Egypt, Finland, France, Germany, Greece, Iceland, Ireland, Israel, Italy, Japan, Luxembourg, Malta, Mexico, Morocco, Netherlands, New Zealand, Norway, Portugal, South Korea, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United States of America.
Two European Union institutions are also financing members: the European Community and the European Investment Bank.
It is expected that after the end of investments in the Czech Republic, operations will end in the seven remaining EU member states (Bulgaria, Estonia, Hungary, Poland, Romania, Slovakia, Slovenia) by 2010.[3]
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[edit] Requirements for EBRD financing
EBRD financing for private sector projects generally ranges from €5 million to €250 million, in the form of loans or equity. The average EBRD investment is €25 million.
Smaller projects may be financed through financial intermediaries or through special programmes for smaller direct investments in the less advanced countries.
Criteria
To be eligible for EBRD funding, the project must:
- be located in an EBRD country of operations
- have strong commercial prospects
- involve significant equity contributions in-cash or in-kind from the project sponsor
- benefit the local economy and help develop the private sector
- satisfy banking and environmental standards.
Project structure
The EBRD tailors each project to the needs of the client and to the specific situation of the country, region and sector. The EBRD typically funds up to 35 per cent of the total project cost for a greenfield project or 35 per cent of the long-term capitalisation of the project company. The Bank requires significant equity contributions from the sponsors, which must equal or be greater than the EBRD’s investment.
There must be additional funding from the sponsors, other co-financiers or generated through the EBRD’s syndications programme.
Sectors supported by the EBRD
The EBRD finances projects in most sectors.
These include:
- agribusiness
- energy efficiency
- financial institutions
- manufacturing
- municipal and environmental infrastructure
- natural resources
- power and energy
- property and tourism
- telecommunications, information technology and media
- transport.
[edit] EBRD Presidents
April 1991 – June 1993: Jacques Attali
September 1993 – January 1998: Jacques de Larosière
September 1998 – April 2000: Horst Kohler
July 2000 – Present: Jean Lemierre
[edit] Headquarters address
One Exchange Square
London EC2A 2JN
United Kingdom
