To the editor, Euromoney
Dear sir,
In response to your article (“EBRD: There’s no place like home”, January 24), I feel it is important to make the following points:
1) The EBRD president/management did not fail to persuade the Bank’s shareholders a year ago to expand its remit to sub-Saharan Africa because that was not the question that was asked!
The shareholders were asked at the Dead Sea Annual Meeting in May 2018 to agree to a sequenced set of reviews: could the EBRD do more in its existing region of operations; and then should it consider expanding to countries outside its current geography, with sub-Saharan Africa being the obvious regional candidate.
The shareholders agreed to this sequence with the insertion between the two reviews of a “pre-feasibility” stage that would look at the capital available and EBRD’s place in the global development architecture before considering whether to give the “green light” to the full feasibility study of expansion.
2) The review of whether EBRD can do more (in terms of quality and quantity) in its existing region has nearly been completed and the answer is it can.
3) The pre-feasibility study has now started but will take a few weeks to complete.
4) So, at or just before the next Annual Meeting in Sarajevo in May, the shareholders will be asked not about plans to expand but whether to give the green light to the full feasibility study given the results of the first two reviews. I am sure you agree that evidence-based decision making is a good approach.
5) Should that feasibility study go ahead and show there is a case for gradual expansion by EBRD to sub-Saharan Africa, then that would have to be approved by shareholders.
6) A glance at the numbers would tell you that EBRD has not been struggling to use its capital since mid-2014. Indeed, there have been record transition impact and investment volume numbers since then.
7) Many shareholders in the “traditional stamping ground” are actually supportive of the evidence-based and sequenced approach set out above.
8) And the numbers belie your view that the EBRD is not visible or has “lost interest” in central and southeastern Europe.
Where there is a transition case and bankable possibilities, the EBRD is on the job: in the Western Balkans, where the bank is the largest institutional investor and EBRD investment per capita the highest in all its regions; in Poland, which consistently appears in EBRD’s top five markets; in the Baltic states where there is renewed interest in privatisation and green projects; and southeastern Europe where the Bank has registered high volumes of investment for several years.
And EBRD’s SME business continues to flourish in central and south-eastern Europe: We continued to invest vigorously precisely in the SME sector in this region, with SME-related financing of €259 million in 2018 compared with €243 million the previous year. We reached out to small business in CSEE with nearly 500 business advisory projects that help small firms expand and flourish.
Towards the end of 2017, together with the European Investment Advisory Hub and the EU, we launched a new programme to help SMEs obtain advice for sustainable growth. The programme – which was launched in Bucharest – will support at least 240 SMEs in Bulgaria, Greece and Romania with tailored business advice over a three-year period.
As you say towards the end of your opinion piece, there has surely been a failure of communication. But certainly not on the part of the EBRD.
Yours faithfully
Jonathan Charles
Managing Director, Communications, EBRD
