How we engage for change

More than


million in donor funding was used in 2013

How we engage for change

EBRD donors help the Bank engage in a host of sector operations for durable change in transition economies, from tackling climate change issues to supporting the growth of small enterprises; from helping to strengthen the financial sector to policy dialogue for sustainable reforms; from promoting equal working opportunities and social integration to modernising the infrastructure that sustains people’s lives and the economy. In addition, more than 40 donors contribute to a number of nuclear safety funds which are managed by the EBRD.

EBRD donors help the Bank engage in a host of sector operations for lasting change in transition economies.

2013 commitments by strategic area

Commitments by strategic area
  • Infrastructure 34% | €48,908,984
  • Sustainable Energy Initiative (including sustainable energy financing facilities) 30% | €42,445,832
  • Small business investment and advisory support 23% | €33,283,469
  • Legal transition, environment and policy dialogue 8% | €10,946,986
  • Financial institutions and local capital markets 3% | €3,990,307
  • Private Sector for Food Security Initiative 1% | €1,859,918
  • Other 0.8% | €1,196,004
  • Gender and inclusion 0.5% | €782,127

Hover over chart to reveal areas and percentages.

GEORGIA: Safe waste management in Rustavi

Nobody wants to know where their rubbish goes. But the way it is dealt with can make the difference between a livable urban environment and a dangerously contaminated one. The EBRD, the Swedish International Development Cooperation Agency (Sida), Austria and the ETC Fund have backed a safe, new landfill and Georgia’s first recycling line in the city of Rustavi.

Accelerating transition in infrastructure

Reliable basic infrastructures for transport, energy and other services are crucial for economic development. In the countries where the EBRD works, this frequently involves costly upgrades and represents a priority issue for the Bank. Donor assistance can help to address the challenges this sector poses and make a real difference to people, enterprises and facilities.

Improving urban services

Access to potable water, proper sanitation and solid waste disposal, energy saving transport, greener district heating and road maintenance are services that deeply affect the quality of life. In the EBRD countries of operations millions of people in urban areas cannot yet rely on existing municipal and environmental infrastructures (MEI). The Bank and donor community therefore work with local governments and private operators on the provision of modern, efficient services for citizens.

Institutional reform and investment are of great importance in the transition to a reliable municipal sector, and technical cooperation (TC) is key to overcoming weaknesses in the operational and financial delivery of services, skill shortages and poor regulation.

The Bank in 2013 committed TC funds in excess of €23 million from donors, including the Swedish International Development Cooperation Agency (Sida), the Taiwanese government and the EBRD Water Fund, for 88 assignments supporting project preparation and implementation, including procurement and corporate development.

Innovative assignments helped the EBRD and KfW develop the Municipal Infrastructure Development Fund. It provides financing and TC support to municipalities and utility companies in the Western Balkans through local banks. The Fund helps smaller municipalities attract finance for investments and assists commercial banks with the management of sector risk. The TC component is financed by Austria and Switzerland.

In Ukraine the Eastern Europe Energy Efficiency and Environmental Partnership (E5P) continued to boost energy-efficient investments with significant grant and TC contributions. With the E5P’s expansion to Armenia, Georgia and Moldova in October 2013, the donor community raised an additional €60 million, with the European Union making the largest pledge. Other donors include the Czech Republic, Estonia, Lithuania, Norway, Poland, Romania and Sweden.

Similarly, the Northern Dimension Environmental Partnership (NDEP) is providing grants and leveraging loans to improve water, wastewater and district heating infrastructure in north-west Russia. As a result, St Petersburg’s water authority inaugurated the Northern Sewage Collector Tunnel in 2013, increasing the level of wastewater treatment, which will reduce pollution in the Baltic Sea. In 2013 Germany and Norway contributed additional funds to the NDEP.

In the MEI sector in 2014, the EBRD will continue to combine investments, grants and innovative TC projects, engaging for example in climate change mitigation and adaptation measures and integrating gender equality considerations in its operations. The Bank will focus on Central Asia, particularly the water sector in Tajikistan, and continue to seek investment opportunities in the SEMED region.

Municipal and environmental infrastructure 459kb

Water and wastewater infrastructure 213kb

Modernising power and energy infrastructure

In the power and energy sector donor funding has enabled the EBRD to help address the twin challenges of persistent high energy intensity in the region and the need to reduce carbon emissions.

Donor support has focused on upgrading existing infrastructure, including improving energy efficiency, strengthening regional and national connections which enhance energy security, promoting renewable and low carbon technologies and developing the sector’s legislative and regulatory frameworks.

Projects have been closely linked to energy investment programmes, enabling clients to comply with the Bank’s Environmental and Social Policy and implementing operations to the highest standards. Donor support has also been particularly important in policy dialogue, especially on renewable energy legislation and promoting regional market development.

The development of the Coordinated Auction Office in South East Europe is a good example of this strategy. Electricity trade in this region has been hampered by the fact that each national electricity company manages its own cross-border connections. In 2012 transmission operators decided to set up an office to manage cross-border capacity for electricity trading in the entire region, which is being supported by €660,000 of funding from the EBRD Shareholder Special Fund (SSF). Good progress was made in 2013 in moving from plan to reality, and the first auctions of electricity are expected to take place in mid-2014.

Support from donors also helps the Bank promote investments in the EBRD early transition countries. In Tajikistan funding from Austria is backing a rehabilitation investment in the Kairakkum hydropower plant. In Georgia TC funding from the EBRD SSF is helping the country’s energy regulator to revise the tariff methodology to best-practice standards.

In the southern and eastern Mediterranean (SEMED) region a TC project under way in Morocco, which is funded from the SEMED Multi-Donor Account is supporting the liberalisation of the medium voltage network. This is expected to increase private sector power generation in the region significantly and to promote renewable power in particular.

Power and energy 627kb

Renewing transport systems

Modern transport networks and services are essential to mobility and increasing the opportunities for commercial development. That is why the EBRD has more than doubled its annual investments in the transport sector over the last five years. In 2013 these amounted to €1.1 billion. By blending donor-supported TC funds with investments, the Bank can engage with its clients on sector reform and facilitate the development of more sustainable national and regional transport systems.

During 2013 the Bank mobilised a total of €8 million in TC funding for assignments in three main areas:

  • Assisting clients in reforming and restructuring the sector by introducing market-based structures and more efficient management. For example, with funding from the EBRD SSF, the Bank is commissioning a review of the standards for construction and maintenance that govern road sector activities in Tajikistan.
  • Promoting sustainability in the sector by helping to introduce best practices in, for example, energy efficiency and road safety. The EBRD SSF-funded Sustainable Transport Technical Assistance Programme, for instance, is helping Bank clients to integrate energy efficiency programmes in their investment plans.
  • Supporting investment preparation and implementation, with an emphasis on knowledge transfer. TC projects under way in 2013 ranged from the preparation of a detailed design for rail rehabilitation investment in FYR Macedonia to engineering supervision for road construction in Albania – both funded by the WBIF.

In line with the EBRD’s Transport Sector Strategy, donor-funded projects will continue to target reform, sustainability and the efficient delivery of large-scale infrastructure projects. They will focus, in particular, on strengthening road safety in the Western Balkans, on advisory services for public-private partnerships (PPPs) and, in the rail sector, on implementing energy efficiency action plans across the Western Balkans and the ETCs.

Transport 204kb

Turkey: towards a greener economy

The Turkish Mid-Size Sustainable Energy Financing Facility, with €700 million from the EBRD, €300 million from the European Investment Bank and TC support from the EU, promotes mid-sized renewable energy and energy efficiency projects. It helps develop the carbon market in Turkey and is introducing EU environmental and social standards into sustainable energy projects. As at end-2013 the Facility had disbursed €513 million of loans through seven partner banks.

Addressing energy efficiency and climate change

Over the last decade, trust funds, multilateral development banks and international organisations have integrated climate change mitigation and adaptation strategies into their key objectives and are deploying dedicated funding through a wide range of instruments.

The EBRD has been at the forefront of this trend in donor climate finance, with new funds being set up in 2013 (for example, the Special Climate Change Fund for climate resilience) reaching €112.5 million in total resources supporting action on climate change. Mitigation measures include increasing energy efficiency and renewable energy, while adaptation strategies are focusing on capacity-building programmes for water management, weather-based insurance and climate-resilient infrastructure, particularly in low-income countries.

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To address other key sustainability issues while enhancing business competitiveness, the EBRD in 2013 approved the Sustainable Resource Initiative (SRI). This programme will expand the existing Sustainable Energy Initiative to further focus on the efficient use of materials and water, particularly in the dry southern and eastern Mediterranean (SEMED) region. The full roll-out of the SRI is expected in 2014 and will build on the successful experience of incorporating energy sustainability into the entire spectrum of Bank activities.

Complementing long-established bilateral partnerships with, for instance, Austria (which provided €2 million to support the SRI) or Italy (which replenished its Central European Initiative Fund with €1 million for action on climate change), new programmes have been launched to support the scaling up of climate finance, including in new areas of strategic importance, such as water management, resource efficiency and technology transfer.

For example, in 2013 the EBRD launched the Finance and Technology Transfer Centre for Climate Change (FINTECC) to support the introduction of innovative climate technology. FINTECC offers technical cooperation provided by the Bank and international consultants, as well as incentive grants for clients to introduce eligible technologies. It is available as a complement to EBRD financing. The programme is funded by the Global Environment Facility (GEF) and the EBRD Shareholder Special Fund (SSF).

Thanks to donors’ contributions, the types of support available have also increased. They comprise traditional technical assistance and advisory grants for capacity building, as well as concessional and risk mitigation products alongside Bank investments.

In 2013, the Sustainable Energy Financing Facilities (SEFFs) continued to channel donor support into the financial institutions sector. These credit lines to institutions for investments in sustainable energy operate in 19 countries – including Azerbaijan and Kosovo from 2013 – with €453 million signed participating institutions for on-lending to sub-borrowers. Donor funding for SEFFs, in the form of TC as well as incentive payments and risk sharing, has reached €156.2 million in total. This funding has been critical to the overall success of the SEFF model and resulted in a reduction of 4.71 million tons of annual reductions in CO2 emissions, equivalent to the annual emissions of 2.1 million passenger cars.

Sustainable Energy Initiative 1.4mb

Sustainable Energy Financing Facilities 2.5mb

Climate change adaptation 3.6mb

Serbia: supporting the private sector

The EBRD’s LEF, supported by Italy, the SEMED MDA and the SSF, has helped two brothers strengthen their furniture company which employs some 1,100 people. They have introduced better corporate governance standards, strengthened the company’s financial management and raised its profile among potential investors.

Georgia: small businesses mushrooms!

With SBS assistance, a Georgian mushroom producer benefited from the services of a local consulting company to introduce a customised management information system that streamlined production and control. Two years later, turnover had increased by over 45 per cent and the company has secured around 80 per cent of local market share by replacing imported produce. The cost of the project was shared between the client (70 per cent) and the European Union (30 per cent).

Investing in entrepreneurship

Micro, small and medium-sized enterprises (MSMEs) are a major engine of economic growth, driving job creation and innovation. Improving access to finance for micro and small businesses and providing local entrepreneurs with the know-how to expand through tailored business advice is therefore a crucial aspect of EBRD and donor engagement in the region.

Financing micro and small business

In 2013 donors provided €2.9 million in TC funding to partner financial institutions for MSME finance facilities. TC projects were active in Belarus, Russia, Kyrgyz Republic and Turkmenistan, with funding from the EU NIF, the Russia Small Business Fund, the EBRD SSF and Japan, respectively. Two new microfinance clients in Kazakhstan and Mongolia were also supported by EBRD SSF technical assistance funding.

EBRD partners also benefit from long-standing facilities such as the Western Balkans Private Support Facility, funded by the European Union and the EBRD SSF, the EU-SME Finance Facility in Romania and the Turkey MSME Lending Programme, backed by the EU and US Agency for International Development. In 2013 the latter programme was further expanded to incorporate the Turkey Agribusiness Financing Facility. This is increasing access to medium and long-term funds for successful agribusinesses, while continuing to expand the MSME portfolios of partner institutions in the less advanced east of the country.

Furthermore, €600,000 was made available by donors (mainly the EBRD SSF) to the Trade Facilitation Programme targeting exporting and importing SMEs as well as corporates.

The EBRD’s Local Enterprise Facility (LEF) has been an effective instrument for supporting small business for the past seven years. It helps successful entrepreneurs to expand or restructure their businesses through equity-driven investments (in which the Bank owns minority shares). The LEF operates in the Balkans, SEMED region and Turkey, supporting companies whose needs are not sufficiently addressed by existing financing sources.

Since its inception, the LEF has attracted significant donor support, in particular from Italy, and also the EBRD SSF and SEMED MDA. The Facility mobilises donor support through risk sharing and TC grants for project implementation at the pre- and post-investment phases. The work of the LEF is being integrated in the new Enterprise Expansion Fund (ENEF), a component of the Western Balkans Enterprise Development and Innovation Facility (WBEDIF).

Local Enterprise Facility 593kb

Advising small and medium-sized enterprises

In addition to improving their access to finance, the EBRD helps small and medium-sized enterprises (SMEs) acquire the know-how that can transform their businesses through its Small Business Support (SBS). SBS draws on the expertise of local consultants and international advisers on business strategy, quality management, export promotion or energy efficiency to help small enterprises reach their growth potential.

All projects – numbering more than 1,400 per year – are on a cost-sharing basis. Through SBS the EBRD is also building a competitive market for business advice in each country of operations through training courses, seminars and other activities. This work is only possible thanks to continued support from donors including the European Union and over 20 bilateral contributors, and its impact is clear. In 2011-13, 71 per cent of enterprises increased turnover and 59 per cent increased the number of employees, resulting in the creation of over 25,400 new jobs. Moreover, in the same period, 67 clients secured finance from the EBRD and 594 from local banks, including 216 EBRD partner banks.

Ongoing innovation is an important part of SBS strategy, which in 2013 developed a more comprehensive approach to supporting women entrepreneurs through the Women in Business programmes. Two such programmes were launched in Egypt and Turkey with support from the MENA Transition Fund and the European Union, respectively.

SBS also continued to support export promotion in Kazakhstan, Kyrgyz Republic and Tajikistan through a programme for Central Asia supported by the United States. Through SBS, and with funding from Austria, the Bank launched a new training programme for consultants on energy efficiency in buildings and industry in Romania. Also, SBS has been working with partners in Croatia, Egypt and Kazakhstan to build sustainability capacity and transfer methodology. The Bank is expanding its SBS activities in Egypt, Morocco and Turkey and extending its geographic coverage in Russia and Ukraine. Further Women in Business programmes are also planned in Armenia, Azerbaijan, Belarus, Georgia, Moldova, Turkey, Ukraine and the Western Balkans.

Small Business Support 169kb

EBRD-FAO Private Sector for Food Security Initiative

With food security heading policy-makers’ agendas, the EBRD and FAO, with the support of donors, have launched the Private Sector for Food Security Initiative. To match population growth, global food production will need to increase by 60 per cent by 2050. The FAO says this will require more than US$ 80 billion in new investments annually. This cannot happen without greater private sector engagement.

Strengthening food security

A strong private sector is vital for food security because it is best placed to increase market supply and the efficiency of global food production and distribution. For this reason in 2011 the EBRD established the Private Sector for Food Security Initiative.

In 2013 donors continued to provide generous funding to the Initiative which, since its inception, has received a total of €9.4 million. Approximately €4.2 million has been provided for policy dialogue activities and €3.6 million for capacity building of agribusinesses in the Bank’s recipient countries.

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Thanks to funding from Denmark and the EBRD SSF, the Initiative has facilitated more liquidity in primary agriculture by supporting pre- and post-harvest financing mechanisms such as warehouse and crop receipts systems. Related legal reforms include new laws drafted in Russia, Serbia and Ukraine. The EBRD has also worked with a number of banks to implement credit lines for agriculture and agribusiness.

The Initiative continued to support public-private platforms. Following the success of the Ukraine Grain Working Group established in 2011, dairy industries and the Ukrainian government asked the EBRD and the United Nations’ Food and Agriculture Organization (FAO) to help set up a similar working group for the dairy sector. This platform was established following the Ukraine Dairy Market Forum held in May 2013 and sponsored by the Central European Initiative (CEI).

Public-private partnerships are planned to start in Egypt, following recommendations of the EBRD-FAO Private Sector for Food Security Workshop in Cairo in June 2013, an event funded by the SEMED MDA. In this context, the MedAgri Network, was launched in the SEMED region as the channel for IFIs and private banks investing in agriculture. Modelled on the EastAgri website, the network helps promote cooperation and ensure the coordination of food security activities.

New policy dialogue and TC activities started in Serbia in 2013 with donor support from Luxembourg. These promote compliance with higher food safety and quality standards in the meat and horticultural sectors. The EBRD and FAO are assessing the potential for the development of geographical indications (GIs), which identify the origin and characteristics of agricultural products as a way of improving the efficiency and inclusiveness of agricultural and food systems.

Also in 2013 the EBRD extended its capacity building for the agribusiness programme to the early transition countries (ETCs) with funding from the ETC Fund. This programme facilitates investments and is modelled on a similar programme, funded by the EU NIF and SEMED MDA, which was launched in 2012 in the SEMED region. As a result, projects have begun in all SEMED countries and have in turn leveraged further investments.

In 2013 water-use studies started in Jordan, Kyrgyz Republic, Turkey and Ukraine under the Water along the Food Chain programme funded by the EBRD SSF and SEMED MDA. Furthermore, the Bank and FAO conducted a review of the olive oil sector in Morocco and Tunisia, and a review of the Moroccan oilseeds sector, assessing production and processing efficiency, was completed.

Private Sector for food Security Annual Report 1.2mb

Public procurement reform in Mongolia

In Mongolia, the government has been working since 2008 to introduce international best practice in public procurement by improving its laws and regulations. As part of this plan, it has also established an electronic procurement (eProcurement) system, which facilitates the purchase and sale of supplies, work and services through the internet and other information systems.

The EBRD UNCITRAL Public Procurement Reform Initiative, worth over €2.1 million, was supported by the Early Transition Countries Fund, the EBRD Shareholder Special Fund and – more recently – the Slovak Republic.

Guiding towards better policies and regulations

The process of transition to open-market economies needs comparative economic and social analysis for continued advancement. It also needs policy dialogue to ensure that sustainable economic progress is underpinned by improvements in the business environment and by appropriate legal and regulatory reforms. The EBRD, therefore, is very active also in these areas where donor support, beyond grant provision, often translates into guidance towards improved policy standards.

Protecting environments and people

The EBRD strives to promote sustainable development and ensure that its activities have a positive impact on the people and environment in the countries where it works. This strategic approach is underpinned by the Bank’s Environmental and Social Policy. It is also backed by donor-funded TC projects, which help the EBRD address environmental and social issues, including health and safety, by promoting best practice, transparency and accountability in these areas. Technical cooperation also helps the Bank be a more effective partner in international cooperation and policy dialogue initiatives.

Over the last 10 years, the EBRD has carried out more than 150 TC projects and framework programmes focusing on environmental and social issues, with total funding of approximately €20 million from donors, including the European Union, SEMED MDA and the EBRD Shareholder Special Fund (SSF).

In 2013 TC funding of over €275,000 supported projects, including one aimed at tackling the high rate of work-related road injuries in Moldova. The Bank worked with the Automobile Club of Moldova and other stakeholders to organise a workshop in the capital, Chisinau, for regulatory authorities, state police, ambulance services and private companies such as Japanese motor manufacturer Toyota. It helped develop participants’ capacity to manage road risk within business operations, to minimise accidents and injuries and to share best practice knowledge and experience.

Other projects included promoting sustainable environmental development in Mongolia, advancing road safety awareness in Ukraine and exploring how to ensure that retail developments for urban regeneration in Egypt and Jordan respect local culture and heritage in order to stimulate investment, tourism and public and private co-operation.

Read the EBRD Sustainability Report

Advancing legal transition

The EBRD’s Legal Transition Programme (LTP) aims to improve the investment climate in the countries where the EBRD works, by helping to create a transparent and predictable legal environment. Its activities range from assisting governments with the drafting of new legislation to designing new institutions (for example, pledge registries) and training public officials and judges. LTP activities in 2013 were financed largely by the EBRD SSF, but bilateral donor input remained instrumental to the programme. Funding from the Czech Republic, Italy and Luxembourg helped organise training courses for judges in Albania, Moldova, Mongolia and Montenegro, so raising the standards for contract enforcement in these countries. These programmes, together with EBRD SSF-financed judicial training, benefited over 900 judges in 2013 (including 200 in Mongolia and 150 in Albania).

Donors also supported institution-building activities. With Austrian funding, the Bank was able to boost institutional capacity at the Centre for Public-Private Partnership in Serbia, while in the Kyrgyz Republic the Bank used funding from Finland to organise regulatory training sessions for telecommunications officials.

The Slovak government provided financial assistance to promote public procurement reforms in the Commonwealth of Independent States and Mongolia under an EBRD-United Nations Commission on International Trade Law initiative, which was also active in 2013 in Armenia, Kyrgyz Republicand Tajikistan. In addition, Slovak funding supported Georgia and Moldova’s accession process to the World Trade Organization’s Government Procurement Agreement.

In 2014 the LTP will intensify its support for small business development, particularly in relation to corporate governance, secured transactions, restructuring and access to public contracts. More judicial capacity-building programmes will be launched, also covering the SEMED region.

Legal transition programme 214kb

 Conducting economic research

Economic research is a core activity of the EBRD to understand problems and policy challenges across its region of operations, to identify its strategic priorities and to support its operations.

In 2013 the Bank published two major research reports: Diversifying Russia, funded by Japan and the EBRD SSF, and the Transition Report 2013. Also, the fifth round of the Business Environment and Enterprise Performance Survey (BEEPS V), with funding by the EBRD SSF, was completed in Russia and rolled out in all other countries of operations, including the equivalent enterprise survey in the SEMED region. Meanwhile, the SEMED Life in Transition Survey, supported with funding from the SEMED MDA, was launched.

Also in 2013 the Bank started a randomised controlled trial (RCT) to measure the long-term impact of access to credit on female entrepreneurship in Morocco, while in Tajikistan an RCT is analysing EBRD capacity training for improving the professionalism and work quality of commercial judges. In the Kyrgyz Republic the Bank is assessing the economic impact of its investment in water infrastructure improvements at household level. All these studies are funded by the EBRD SSF.

For 2014 Bank research will focus on the impact of financial integration on stability and access to credit for small businesses, on firm productivity, governance and innovation, on political economy and economic inclusion and on the impact of EBRD operations on firms and households.

Kyrgyz Republic: promoting gender equality in municipal services

Nazgul Shamekova, a municipal trolleybus driver in the capital, Bishkek, explains how the EBRD is supporting the revival of the city’s trolleybus services and the municipal company's gender equality plan. The projects are supported by the ETC Fund, Czech Republic, the TaiwanBusiness-EBRD Cooperation Fund and the EBRD SSF.

Boosting gender equality and economic inclusion

Promoting gender equality and economic inclusion through investments and donor-funded support are key aspects of the EBRD’s commitment to advancing sustainable growth in its countries of operations.

Targeting equal opportunities for women and men

Over the past few years the Bank has made significant progress in integrating gender considerations into its operations. In 2013 it launched the Strategic Gender Initiative, outlining how it will address gender equality gaps and promote women’s socio-economic empowerment, equal opportunities and participation in the labour market.

For example, the EBRD SSF is providing financial assistance to 14 financial institutions in Azerbaijan with the aim of increasing the number of female loan officers and business clients. The project, which started in 2012 and is expected to finish in 2014, has helped to identify practices that dissuade women from participation and the changes required to secure their involvement. Based on its findings, a workshop was designed to train senior managers, loan officers and human resources staff of the participating institutions as to how to increase the proportion of women in the workforce and among their micro, small and medium-sized enterprise (MSME) client bases.

In 2013 donors supported several other gender-related initiatives in Jordan, Kyrgyz Republic, Serbia and Turkey. In the Kyrgyz Republic, for example, a TC assignment funded by the EBRD SSF helped promote equal access for women and men to all municipal services in the capital, Bishkek. Another assignment supported a training programme in Turkey to increase the financial, legal and managerial literacy of female entrepreneurs. Other donor contributions in 2013 included €850,000 for the Gender Advisory Services Framework from the TaiwanBusiness-EBRD TC Fund, the SEMED Multi-Donor Account, and the SEMED Cooperation Funds Account, and €300,000 from the Climate Investment Funds, targeting gender equality considerations mainly in Kazakhstan, Turkey and Ukraine.

Promoting gender equality at the EBRD 398kb

Adding ‘inclusion’ to the economic equation

In 2013 the EBRD amended its methodology for assessing the transition impact of its projects to take into account economic inclusion, which is an integral part of development. The Bank now measures the extent to which economic institutions, markets and education systems offer economic opportunities to individuals, regardless of their specific circumstances such as gender, place of birth or, for young adults, social background.

Although this applies to all EBRD countries of operations and sectors, economic inclusion is a particular priority in the SEMED countries, where youth and female unemployment are very high, and in south-eastern Europe and Central Asia, where regional disparities are especially stark.

TC activities are vital to integrating economic inclusion considerations into projects that improve access to employment and services, promote skills transfer to women, young people or regions and support clients wishing to introduce more inclusive corporate standards and practices.

For example, in 2013 the EBRD provided a €60 million loan to help finance the construction in Jordan of a new shopping, hospitality and entertainment complex that will form the centrepiece of a major urban regeneration scheme in Amman, the capital. With 21 per cent of young people disengaged from education, employment or training, and with only 17.6 per cent of women participating in the workforce, inclusion gaps in Jordan are large. With TC funding from Korea, the project will support the client in offering young people and women a range of training and work placement opportunities in retail, facilities management, hospitality and related services.

Similarly, TC funding from Luxembourg in support of an investment project to rehabilitate local roads in Serbia will help create apprenticeship opportunities for jobless young people in remote parts of a country with the highest rates of youth unemployment in the EBRD region.

Other examples include water projects that improve health conditions for remote communities in Egypt and the Kyrgyz Republic, and the extension of credit lines specifically aimed at women entrepreneurs in Jordan and Turkey. Donor support will play an increasingly key role in the development of further inclusion projects.

Georgia: advancing the agribusiness sector

Georgian farmers, such as milk producer Pavle Khutsishvili, have a further opportunity to receive loans to help sustain their small businesses through the EBRD's Georgian Agricultural Financing Facility. The €40 million credit line in Georgian currency targets farmers and agribusinesses through local banks, and with TC assistance from the EU NIF also helps to improve bank agri-lending skills.

Backing financial institutions and local capital markets

The EBRD is working to build a stable financial sector in the countries where the Bank works, by stimulating lending to the real economy, developing local currency and capital markets and promoting better governance and improved risk management of institutions. Donor-funded TC projects are fundamental to EBRD investments, micro and small business lending programmes, energy efficiency credit lines, the Trade Facilitation Programme (TFP) and policy dialogue.

In 2013 a total of €1.9 million of TC funding from donors including Luxembourg, the EBRD ETC Fund, the EBRD SSF, the Russia Small Business Fund and the FYR Macedonia Financial Fund supported 14 projects to underpin the Bank’s work with banking and non-banking financial institutions.

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Five TC assignments funded by the EBRD SSF were initiated in 2013 under the Bank’s Local Currency and Local Capital Markets Development Initiative. This is designed to advance reforms and policies to strengthen the financial market and encourage the use of local currency. One project is promoting corporate bond issuance in the ETCs, an outcome of which was the successful issue in September 2013 by the Kyrgyz Investment and Credit Bank of a bond in Kyrgyz som.

TC funding also supported a programme to stimulate the use of cross-currency swaps among banks in south-eastern Europe; the development of a country-by-country assessment of the cost of issuing and transacting in local currency securities; a study of the applicability of Central Clearing Counterparties in domestic capital markets; and technical workshops on reporting issues in Russia (prompting the formation of two private-public working groups to expedite structural repository reform).

The Bank’s engagement with financial institutions in the SEMED region continued through the Trade Finance e-Learning Programme and investment preparation-related assignments. TFP activities are particularly relevant in the ETCs, Kazakhstan and Ukraine. Donor support for policy dialogue and regulatory reform continued in 2013, encouraging financial innovation. For example, a TC project to improve the information system of a deposit insurance agency funded by Luxembourg and the SSF is under way in Albania. Similar projects funded by the ETC Fund have resulted in a new information technology system and better operational processes in the Kyrgyz Republic and in supporting the establishment of the Mongolia Deposit Insurance Corporation.

Furthermore, with funding from France, the EBRD is helping local authorities to develop a regulatory framework for mobile banking in Tajikistan. Efforts to improve MSME access to finance will remain a priority in 2014, especially for agricultural businesses and women entrepreneurs. Grants will help mitigate lenders’ risks, provide initial performance incentives and facilitate the transfer of knowledge. Moreover, the Bank will continue to promote the development of local capital markets, local currency lending and financial infrastructure.

Financial institutions 241kb

Financial institutions – selected programmes 273kb

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