Kyoto University, Japan
It gives me great pleasure to be here today to talk to you about the Bank I have the honour of serving as President and about how you can help us change lives across three continents.
Thank you all for the invitation to speak, and especially Professors Kono and Takara for the very warm welcome they have organised for our party so far.
I have been very impressed by the history and reputation of your university.
And am looking forward to having to answer some sharp questions from you a bit later.
But, before then, we have a treat in store for you.
It went down very well, so well that we want to show it to you today.
In fact, you will be only the second group of people to watch it ‘live’ as an audience.
To my mind, it portrays – in a very modern and accessible way – the scope and scale of what we do, both in terms of geography and sector.
So please watch it with me now and then I will go into more detail about our unique business model, our background and how you can get involved.
- Video: The EBRD opens doors across three continents
- EBRD history and Japan
By the way, it was produced entirely in-house by our very talented Communications department.
The young woman and the young man who appear at the beginning and the end are not actors but colleagues of mine.
I don’t make a cameo appearance in it but the rattling door through which Uyvar, the young lady, starts her journey is the door of my office.
That video gives you a sense of what the EBRD looks like today.
We were actually founded almost three decades ago to help build a new post-Cold War era in Central and Eastern Europe and what was then the Soviet Union.
I was then a bit older than the Turkish and Canadian stars of the video – but not by that much.
And, right from the start, Japan has been part of the EBRD story.
It was a founding shareholder of the EBRD.
Japan has also been an extremely active and supportive shareholder, and Japanese companies regularly invest with us in our projects.
The total value of EBRD-Japan investment currently stands at US$10.6 billion, with US$ 6 billion from the EBRD side and US$ 4.6 billion from Japanese sources.
At the same time Japan is one of our most generous national donors, contributing funds – more than US$ 190 million so far – to ensure that we can invest in projects which promote sustainable and inclusive development in the countries which need it most.
I hope that some of you here today will play a role in further strengthening the relationship between the EBRD and Japan.
I’ll return to that subject later but before I do, I want to tell you a bit more about the Bank.
- The EBRD today
The EBRD is a multilateral development bank, like the World Bank and regional development banks for Asia, Africa and Latin America.
We are owned by governments, 69 of them, plus the European Union and the European Investment Bank.
But we are very different from other multilateral development banks in three ways that reflect the historical moment when the EBRD was created, the end of the Cold War in Europe.
First, we work only in countries committed to multi-party democracy, political pluralism and market economies.
No other multilateral development bank has such an explicitly political and economic mandate.
What is important here is the direction of travel. A country has to be on the journey towards markets, democracy and pluralism.
It does not necessarily have to have reached the final destination – whatever that would be for democracy and markets – to receive our support.
Second, our constitution lays down that 60% of our lending must be to the private sector. That figure currently stands at 79%.
No other multilateral bank, with the exception of the International Finance Corporation, an arm of the World Bank Group, has such a deep knowledge of working in the private sector in the interests of development.
And third, we are project-based, providing loans and equity to companies.
Overall, we have invested more than US$145 billion in over 5,200 projects.
We do not, unlike the other multilateral development banks, fill budget or current account deficits.
And because of our projects, we know a lot about firms and the different sectors of every economy in which we invest.
We began operating in what had been the command economies of eastern Europe and the ex-Soviet Union.
But the transformations we helped bring about there were such a success that before long other countries wanted us to work with them too.
And our shareholders were strongly supportive of our doing so.
In fact, they have approved our move into new markets four times already.
So we are now investing in nearly 40 countries, stretching from Morocco to Mongolia and from Estonia to Egypt. And, within the geographical scope of EBRD’s operations are the six economies of Central Asia, in which Japan has taken particular interest.
There is certainly a possibility that, after I step down as President next year, we will begin working in sub-Saharan Africa as well.
But that will be for our shareholders to decide.
We were pioneers back in the 1990s. And over the years we have helped shift global thinking on development and lead the way in a number of important areas:
- the green economy;
- the development of basic municipal services;
- and creating programmes to help small and medium-sized businesses, thus creating new jobs, enhancing skills and driving growth; and
- providing a very large proportion of our finance in local currency.
We are a powerful catalyst for foreign direct investment and the channelling of equity and private financial flows into emerging markets.
And, yes, we also focus on inclusion and bringing more women and other excluded groups into the workforce.
Only recently our Women in Business programme passed a significant milestone when the total of its financing topped the €500 million mark.
In the less than four years since its launch it has provided credit to more than 60,000 women-led small and medium-sized companies in 18 countries.
There are many reasons why we now pay so much attention to gender.
One of them is quite simple. We realise that many of the goals we at the EBRD set for both ourselves and for the countries where we work will be far easier to realise if we can at the same time advance the cause of gender equality.
Over time, we have also learned a lot about the role of an effective state in encouraging the development of open and sustainable market economies.
We combine a private sector focus on financing and the delivery of development goals with extensive policy dialogue with the authorities at every level in the countries where we work.
Improving the investment climate and standards of governance is, we now appreciate, absolutely essential for boosting growth.
The upshot of all this is that we are delivering huge impact on the ground.
For three years in a row now we have invested around US $10.5 billion in our countries of operations.
In 2019 I want EBRD to break the US $11 billion investment barrier for the first time in our history.
Our shareholders have asked us to deliver even more. We intend to do just that,
Hence the hashtag #EBRDmore you saw several times in the film.
I mentioned the green economy earlier.
We are now well on track to hit a relatively new target of ours: that of 40 percent of our annual business volume consisting of investments in climate finance by the end of next year.
- Examples of Japanese partnership with the EBRD
Let me single out a few specific examples of our work with Japanese partners to give you an even clearer idea of what we do and our impact.
The first is very much part of our investment in the green economy, in a country, Mongolia, not so very far from where we are today.
Mongolia’s economy is expanding fast. But that growth is largely powered by ageing and polluting coal-fired energy plants.
And yet the country possesses vast, almost inexhaustible, potential for using wind to generate electricity.
Hence the importance of a project such as the Tsetsii wind farm, only the second private wind farm in Mongolia’s history.
This is the fruit of cooperation between the EBRD, the Japan International Cooperation Agency and Clean Energy Asia, itself a joint venture part owned by SB Energy Corporation, the renewable energy arm of Japan’s Softbank Corporation.
The total investment in the project is US$ 89 million, with US$ 25 million from the EBRD and US$ 64 million from JICA.
Thanks to that, Mongolia and its people acquired a 50MW wind farm which will reduce more than 150,000 tons of CO2 every year.
The second example of our work with a Japanese company is our US$150 million loan to Brisa, the market leader in tyre manufacturing in Turkey.
Brisa is itself a joint venture between a Turkish conglomerate and Japan’s Bridgestone Corporation.
The new greenfield site the loan is financing will not only boost the local economy but is also funding training programmes which will provide young people with the skills that employers are looking for.
- You, Japan and the EBRD
So that is a snapshot of what the EBRD actually does.
And this is where you come in.
We couldn’t achieve all these amazing results without having the best and the brightest working for us, both at our headquarters in London and in the countries where we work - and in our Tokyo office, which I opened in 2016.
We are definitely hiring – and want more Japanese citizens to share in the excitement of being involved in what we do.
As of today, we have 2,700 members of staff.
Two thirds of them are based in London.
In fact, earlier this summer we agreed a move to new premises in what will be an absolutely state-of-the-art building in the Canary Wharf district of London.
The other one third of our staff are located in our offices abroad.
Indeed, one of the attractions of working for the EBRD is the chance to get to know our countries up close.
Our 53 offices are based not just in national capitals but in secondary cities and far flung regions as well.
And the EBRD is a whole multicultural world in its own right, with the people working for us coming from dozens of different countries.
That is one of our strengths.
We are a bank, yes. But, as I hope I have made clear today, we are far more than just a bank.
Our financial results are important to us, of course.
But our real priority is investing in changing lives.
We recruit bankers, lawyers, economists and risk and procurement specialists.
But we are also on the lookout for public policy experts and people who can work with us to help the small business sector.
And many other specialists for a whole host of different roles.
We would very much welcome more job applications from citizens of a shareholder as important to us as Japan.
I am glad to say the numbers of Japanese applicants are growing.
But, to be completely honest with you, the numbers are still too low.
Changing that state of affairs is a personal priority for me and my colleagues.
My visit here today is very much part of those efforts, which also include numerous missions to Japan by the Bank’s senior management and outreach at careers fairs.
Make no mistake. We want more Japanese citizens to give serious thought to working for us – or, taking a broader, more global view, development finance in general.
- A career in development
As a young man, I studied development economics myself and my first experience of working in the field was in sub-Saharan Africa.
I haven’t spent all my adult life in the development world.
But not for one moment do I regret my initial choice of specialisation.
One of the intellectual satisfactions of working in this area is the way development thought and practice shifts over the years.
How it tacks from one end of the spectrum to the other.
We see this in today’s debates about multilateralism, globalisation and trade, debates in which some of the values that I believe in most strongly are being questioned in new ways.
It is your generation which will have to come up with solutions to some of the dilemmas we currently face.
You can and should make a very real contribution to the development agenda yourselves.
It might be in the form of academic research that throws new light on the problems we come up against in the field.
There is, of course, the way into development via civil society, a very important partner of ours.
And you could work within government.
If you do, don’t forget the state’s vital role in providing the right conditions for private businesses to thrive.
I am sure that some of you are considering another pathway, that of the private sector.
It generates wealth, creates new opportunities for men and women and fosters sustainable and, I hope, inclusive economic growth.
But, and here I revert to my role as EBRD President and development veteran, I do urge you all to think seriously about a career with the EBRD.
Our achievements over the last three decades have been nothing less than inspiring.
I do hope that both the video you watched earlier and my remarks have conveyed some of the excitement and pride I personally feel about what we do – day in day out – over three continents.
Thank you very much for listening and I do hope that the next time we meet some of you will be working for the EBRD.
Now I would be very happy to answer your questions.