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Funding success |
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ETC Fund donors meet in The Hague The last three years have been good ones for the Early Transition Countries: a total of €45.5 million has been pledged to the multi-donor ETC Fund*, while in 2006 alone the EBRD invested €290 million in 80 operations. Launched in 2004, the Early Transition Countries Initiative was directed towards seven of the Bank’s poorest countries of operation – Armenia, Azerbaijan, Georgia, the Kyrgyz Republic, Moldova, Tajikistan and Uzbekistan. The initiative embraced Mongolia in November 2006 after it became the Bank’s newest country of operation. “The unique thing about the ETC Initiative and its multilateral donor fund is the coordination between donors in delivering assistance to poor countries,” Gonzalo Ramos, Board Director for Spain, told donors participating in the eighth meeting of the ETC Fund on 9 February in The Hague. “Many donor countries have bilateral programmes with ETCs but poverty in these countries is so deep that building market economies requires a coordinated approach between donors in delivering assistance,” added Hans Sprokkreeff, the Board Alternate Director for The Netherlands. The Dutch government recently pledged €5 million to the ETC Fund for grant co-financing of projects, the first time such support has been channelled via the fund. The money will be spent on two infrastructure projects: a road maintenance facility in Tajikistan and an urban transport project in Ulaanbaatar, the capital of Mongolia. Quadrupling results in less than three years George Krivicky, Director of the ETC Initiative, is understandably satisfied with its impact. “In 2003, just before this initiative was launched, the EBRD had signed just 18 operations in the ETCs. Its goal was to triple the number of operations to be signed annually by the third year of the initiative. The EBRD has in fact done better than that: in 2006, it quadrupled the number of operations signed.” Last year, the EBRD signed 80 new operations (excluding oil and gas deals) in the ETCs, up from 61 in 2005 and 32 in 2004. The value of new project signings is also on the rise, totalling €290 million in 2006 versus €250 million in 2005, €92 million in 2004 and €53 million in 2003. In addition, the EBRD has increasingly supported trade through its Trade Facilitation Programme, completing 478 transactions with a turnover of €112 million in 2006. The Early Transition Countries received €22 million in donor assistance in 2006, up from €18 million in 2005 and €8 million in 2003. To date, €45.5 million has been pledged to the ETC Fund, in addition to funding made available by donors bilaterally. These grants help pay for expert analysis and advice for ETC companies and governments. The show must go on “What a difference the multi-donor ETC Fund makes!” Sabina Dziurman of the Group for Small Business said during a presentation on three small business development projects in need of donor finance in Tajikistan. “The ETC Fund allows us bankers to make promises to people on the ground, to be creative and innovative knowing that there is donor money to support vital projects on which the lives of families in far-flung villages, the education of their children and the empowerment of women depend,” Ms Dziurman said. At the meeting in The Hague, 16 projects totalling €4.6 million were approved by the donors. These will support small business lending operations, provide business advisory services, improve infrastructure and boost investment in energy efficiency projects in the ETCs. Masaru Honma, Country Director for central Asia, and Mike Davey, Country Director for the Caucasus and Moldova, briefed donors in The Hague on achievements in their regions while Alistair Clark, Director of the Environment Department, presented a report on a UK/Canadian-funded study on gender equality. “The ETC Fund has become one of the key elements of a sustained ETC Initiative,” said Junko Aya, who covers ETCs in the EBRD’s Official Co-financing Unit. “The demand to finance projects is strong and, with Mongolia becoming a beneficiary of the ETC Fund in 2006, replenishment of the fund is crucial to continue improving people’s lives in the poorest countries of the EBRD region.” * Donors of the ETC Fund, established in 2004, are Canada, Finland, Ireland, Japan, Luxembourg, The Netherlands, Norway, Spain, Sweden, Switzerland, the United Kingdom and Taipei China.
By Marjola Xhunga
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