European Bank for Reconstruction and Development

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European Bank for Reconstruction and Development
EBRD hq in London.jpg
EBRD headquarters in London
EBRD logo (2).png
Founded 1991
Type International financial institution
Sir Suma Chakrabarti
Mission development bank

The European Bank for Reconstruction and Development (EBRD) is an international financial institution founded in 1991. As a multilateral developmental investment bank, the EBRD uses investment as a tool to build market economies. Initially focused on the countries of the former Eastern Bloc it expanded to support development in more than 30 countries from central Europe to central Asia. Besides Europe, member countries of the EBRD are from five continents (North America, Africa, Asia and Australia, see below), with the biggest shareholder being the United States, so the name is somewhat of a misnomer. Headquartered in London, the EBRD is owned by 65 countries and two EU institutions. Despite its public sector shareholders, it invests mainly in private enterprises, together with commercial partners.

The EBRD is not to be confused with the European Investment Bank (EIB), which is owned by EU member states and is used to support EU policy. EBRD is also distinct from the Council of Europe Development Bank (CEB).


The EBRD was founded in April 1991 during the dissolution of the Soviet Union by representatives of 40 nations from 3 continents and two European institutions, the European Investment Bank (EIB) and the European Economic Community (EEC, now European Union – EU), after reaching agreement on the bank's charter, size, and distribution of power among shareholders.[1]


The EBRD was founded to support countries of the former Eastern Bloc in the process of establishing their private sectors.[2] To that end, it offers "project financing" for banks, industries and businesses, for new ventures or existing companies. It works with publicly owned companies to support their privatization, as advocated by the WTO since the 1980s [3] and "improvement of municipal services".

The EBRD mandates to work only in countries that are "committed to democratic principles". It promotes "environmentally sound and sustainable development", and does not finance "defense-related activities, the tobacco industry, selected alcoholic products, substances banned by international law and stand-alone gambling facilities."[4]


Some NGOs have criticized the EBRD for financing projects they consider to be environmentally and socially harmful. Although it has increased its investments into energy efficiency and sustainable energy in recent years, these NGOs consider the bank continues to diminish the impacts of green investments by financing carbon-intensive development such as coal, oil and gas production, transportation and generation, motorways, and airports.[5][6] Among the contested projects are the Ombla power plant in Croatia,[7][8] the Kumtor Gold Mine in Kyrgyzstan, and the Šoštanj lignite power plant in Slovenia.[5]

NGOs have criticized the EBRD on the lack of progress the EBRD makes in its main mission, the “transition towards open and democratic market economies.”[9][10]

2014 sanctions against Russia[edit]

The EBRD announced on 23 July 2014 that it would suspend new investment projects in Russia, following an earlier declaration by the European Council.[11] The European Council declaration was made in the context of the 2014 pro-Russian unrest in Ukraine.[12] As of 2014 Russia has been the biggest funding recipient of all countries. In 2013, the Russian Federation received 1.8 billion € for investments from the EBRD and 1 billion € from the EIB. Russia employed the funds to finance a variety of projects like pipeline valves, property acquisitions, and a loan to a hypermarket chain. Two Russian projects were awaiting funding from the EBRD: a 300 million € plan for promoting energy efficiency, and a $180 million loan to lease agricultural and forestry equipment.[13][14] The bank stated that it will continue to manage on-going projects in Russia.[11]

Central Asia[edit]

In 2015, the EBRD invested a record amount in the Central Asian region. The total investment in 2015 rose by 75% reaching €1,402.3 billion. Kazakhstan reported the largest total volumes of investment.reaching 790 million euro in 2015.[15]


European Bank for Reconstruction and Development member states
  Recipient countries of investments
  Financing members


The following presidents have served the EBRD to date (as of 2017).[16]

Recipient countries of investments[edit]

The following countries are recipients of funds: Albania, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Estonia, Egypt, Georgia, Greece, Hungary, Jordan, Kazakhstan, Kosovo, Kyrgyzstan, Latvia, Lithuania, Macedonia, Moldova, Mongolia, Montenegro, Morocco, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Tajikistan, Tunisia, Turkey, Turkmenistan, Ukraine and Uzbekistan.[17]

The EBRD publishes its tenders and contracts on its own website [18] and in Development Business. a publication launched in 1978 by the United Nations with the World Bank and other development banks.[19]

Financing members[edit]

The following countries contribute in financing the EBRD: Australia, Austria, Belgium, Canada, China, Cyprus, Czech Republic (receiving member until 2007-12-31),[20] 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 as well as the European Union and the European Investment Bank[21]


The EBRD offers loan and equity finance, guarantees, leasing facilities, trade finance, and professional development through support programs. Direct investments range from €5 million to €230 million. Smaller projects are financed both directly by the EBRD and through "financial intermediaries". The EBRD website states it has helped finance over 1 million smaller projects by supporting local commercial banks, micro-business banks, equity funds and leasing facilities.

To be eligible for EBRD funding, "a 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 and satisfy banking and environmental standards."

The EBRD finances projects in sectors including agribusiness, energy efficiency, financial institutions, manufacturing, municipal infrastructure, also known as public works (which includes transport, schools, water supply, waste disposal, and pollution control services), natural resources, power and energy, property, telecommunications, tourism, transport, information technology.[citation needed]


Since its founding in 1991, so far only the Czech Republic has graduated from borrower to shareholder within EBRD, in 2007.[22]

See also[edit]


  1. ^ "The European Bank for Reconstruction and Development". Overseas Development Institut briefing paper. Overseas Development Institute. n.d. Retrieved 28 June 2011. 
  2. ^ "About the EBRD". European Bank for Reconstruction and Development. Archived from the original on 2008-08-22. Retrieved 2009-01-07. 
  3. ^ Russell, Muir,; Joseph, Soba, (1 October 1995). "State-Owned Enterprise Restructuring : Better Performance Through the Corporate Structure and Competition". Retrieved 17 August 2017. 
  4. ^ "About the EBRD" (PDF). EBRD. 2014-08-01. Retrieved 2017-03-26. 
  5. ^ a b "The European Bank for Reconstruction and Development". Central and Eastern European (CEE) Bankwatch Network. 2011. 
  6. ^ Goldberg; et al. (1995). "The European Bank for Reconstruction and Development: An Environmental Progress Report". Center for International Environmental Law. 
  7. ^ Mikaela Gavas (January 2013). "Reviewing the evidence: how well does the European Development Fund perform?". Overseas Development Institute (ODI). 
  8. ^ "HEP and EBRD cancel loan agreement for Ombla power plant". 27 May 2013. Retrieved 6 June 2013. 
  9. ^ "Our mission". European Bank for Reconstruction and Development. 
  10. ^ "Are we nearly there yet? Dilemmas of transition after 20 years of EBRD's operations". CEE Bankwatch Network. May 2011. 
  11. ^ a b "EBRD STATEMENT ON OPERATIONAL APPROACH IN RUSSIA". EBRD. 23 July 2014. Retrieved 28 July 2014. 
  12. ^ "European Council conclusions on external relations (Ukraine and Gaza)" (PDF). Council of the European Union. 16 July 2014. Retrieved 26 July 2014. 
  13. ^ "Leaked: EU to cut loans and investment for Russia, punish Crimea". TV-Novosti. 16 July 2014. 
  14. ^ Alec Luhn (16 July 2014). "EU poised to cut funding to Russia and widen sanctions over Ukraine conflict". The Guardian. 
  15. ^ "EBRD investment in Central Asia reaches record €1.4 billion in 2015". Retrieved 23 February 2016. 
  16. ^ "History of the European Bank for Reconstruction and Development (EBRD)(EBRD)". Retrieved 17 August 2017. 
  17. ^ "Where the EBRD works". Retrieved 17 August 2017. 
  18. ^ "EBRD procurement opportunities". Retrieved 17 August 2017. 
  19. ^ "Development Business". 
  20. ^ "Czech Republic homepage [EBRD – Countries]". Retrieved 17 August 2017. 
  21. ^ "European Investment Bank and EBRD will co-manage EU-supported projects in Eastern Europe and Central Asia". 27 November 2006. 
  22. ^ "Czech Republic graduates from EBRD, Press release 23 October 2007". Archived from the original on 29 June 2011. Retrieved 2011-01-25. 

External links[edit]