Signing by EBRD President Chakrabarti during visit to Minsk
The EBRD and Belarus are joining forces to improve the domestic investment climate and corporate standards, with new initiatives in the area of local currency lending to small and medium-sized enterprises (SMEs) and the commercialisation and governance of state-owned enterprises.
During a visit by EBRD President Sir Suma Chakrabarti to Belarus, the Bank and the authorities signed two Memorandums of Understanding (MoU) to this effect in Minsk today.
Promoting local currency lending and strengthening domestic capital markets are shared priorities for the Belarusian authorities and the EBRD. The country’s authorities are committed to facilitating access to affordable local currency funds for local private businesses. In order to achieve this goal they are promoting a macroeconomic, regulatory and market environment that supports the development of the local capital and money markets and local currency borrowing.
The signing also confirms the EBRD’s commitment to providing affordable loans to Belarusian banks, microfinance organisations and small businesses under the EBRD’s Local Currency Programme. It was established to mitigate the exposure of firms in EBRD countries of operations to exchange-rate volatility.
The €500 million SME Local Currency Programme combines the EBRD financing and donor resources to provide eligible borrowers with access to affordable funding. To date, the EBRD has provided access to local currency to over 300,000 SMEs in the countries that are eligible under the SME Local Currency Programme. The Programme is a joint initiative of the EBRD’s Local Currency and Local Capital Markets and SME Finance and Development groups.
The second MoU on commercialisation and governance is intended to provide a framework for cooperation between the EBRD and the government on promoting better business practices in state-owned enterprises. Further commercialisation is expected to increase productivity, improve overall efficiency and, as result, make these firms sustainable and more competitive. Looking ahead, selected state-owned enterprises may attract strategic or portfolio investors.
The EBRD and Belarus agreed to select the state-owned road-management holding company Belavtodor for the implementation of a pilot project to introduce a corporate-governance action plan.
Since the start of its operations in Belarus in 1992, the EBRD has invested almost €1.9 billion in some 90 projects in various sectors of the country's economy.