Leading international financial institutions (IFIs) are working towards greater economic links between emerging Europe and emerging Asia as a way of supporting economic growth in both regions.
At the EBRD Annual Meeting in Warsaw, the EBRD and the Asian Development Bank Institute presented the findings of a new joint study on links between the regions to leaders and senior officials from the IFIs.
The study showed that trade and investment flows between emerging Asia and emerging Europe were still modest, despite increases over recent years.
This demonstrated the potential for a further deepening of links that would help to raise productivity – via the transfer of technology and by increased product differentiation and stronger competition.
The study also concluded that the two regions would benefit from lower tariff and non-tariff barriers, improvement in local and regional infrastructure, higher levels of human capital, better business environments and more effective economic institutions.
EBRD President Sir Suma Chakrabarti told a panel discussion on the issue that the markets had moved ahead of the institutions as far as these linkages were concerned. Many of the countries in Europe where the EBRD invested were already interested in looking at development models in Asia. The links, however, were still embryonic, and Sir Suma said the EBRD had been visiting Asian countries in order to build stronger links and find Asian investors for the EBRD region.
European Investment Bank President, Werner Hoyer, said it was important now that Europe looked beyond the crisis and paid more vigorous attention to the globalisation process, especially by raising investment in research and development.
The International Finance Corporation's Vice President, Dimitris Tsitsiragos, said the IFIs could play a role by working with governments to make the investment climate in emerging markets more attractive, but also to help develop skill sets. He referred to the huge client base of institutions and said the IFIs could help explain the attractions of individual countries precisely to these clients.
Rolf Wenzel, the Governor of the Council of Europe Development Bank, spoke of the importance of helping governments to raise standards, not just in developing skills but also in the promotion of greater integration by supporting minorities within society. Minorities had to become part of the education and training systems within countries, he said.
The IFIs could also assist countries to develop flexible policies that helped support economies in the face of external shocks and to create more resilient financial sectors.
The report was presented by EBRD Chief Economist, Erik Berglof, and Naoyuki Yoshino, Dean, Asian Development Bank Institute.
Wednesday 14 May 2014