G8 endorse extension of EBRD investments to the Middle East and North Africa

By Anthony Williams
@ebrdtony

Leaders of the G8 leading industrial economies on Friday gave strong support to an extension of the EBRD’s investments to the Middle East and North Africa.

In response to the historic changes sweeping across the region, G8 leaders said a new partnership was being established with these emerging democracies in which the EBRD played an important role.

The declaration called for an “[...] extension to the geographic scope of the EBRD’s mandate, in order to support the transition in countries of the region which embrace multiparty democracy, pluralism and market economics.”

The G8 communiqué further said: “The changes under way in the Middle East and North Africa are historic and have the potential to open the door to the kind of transformation that occurred in Central and Eastern Europe after the fall of the Berlin wall.

“The aspiration of people for freedom, human rights, democracy, job opportunities, empowerment and dignity has led them to take control of their own destinies in a growing number of countries in the region.

“Today we launched the Deauville Partnership with the people of the region based on our common goals for the future”, the G8 said.

The Group referred to the EBRD as a unique instrument that was helping to transform the economies of Central and Eastern European countries. The EBRD’s financial strength would enable it to extend its area of operation, while maintaining its current strategic commitments, in the existing countries of operation.

UK Prime Minister David Cameron stressed the important role of the EBRD in a process aimed at bringing security and prosperity to the region. “The EBRD has been given a new mission,” Mr Cameron told journalists at the end of the meeting.

The EBRD has said that it has the capacity, after an initial period, to invest up to around €2.5 billion in the region every year, in addition to its current commitments to the existing countries where it invests between €8.5 and 9 billion a year.

At its annual meeting in Astana, Kazakhstan, last week the EBRD shareholders outlined a timetable for a decision on investing in the region. Any such decision would have to be endorsed by all of the EBRD’s 63 shareholders.

However, the G8 made clear that support for the North Africa and Middle East region could start before any full ratification of a mandate change.

“To fast-start EBRD support to and leverage its experience in private sector development and job creation in the region until the ratification of the extension is completed, we will work with the EBRD towards the creation of a dedicated transitional facility, to allow the bank’s operations to start as early as possible to the benefit of prospective recipient countries...”, the G8 communiqué stated.