LONDON: The European Bank of Reconstruction and Development has the ability to invest annually up to €2.5 billion in total across four “emerging Arab democracies,” its president said on Thursday.
The EBRD, formed in 1991 to help ex-Soviet bloc nations in their transition to market economies, is embarking on a similar course of action in Egypt, Morocco, Tunisia and Jordan.
“We have been encouraged by our shareholders to extend our mandate to the southern and eastern Mediterranean region, adding Egypt, Tunisia, Jordan and Morocco to the 29 countries where we already invest,” the bank’s president Thomas Mirow said in a lecture at the London School of Economics.
“We will focus on trying to develop the private sector in the emerging Arab democracies.”
Mirow added: “Across the whole of the southern and eastern Mediterranean region, we have the capacity to invest, eventually, as much as €2.5 billion ($3.27 billion) a year.
“We don’t do these investments alone. For every euro that we put into a project, it attracts, on average, more than two euros of private sector money. So, €2.5 billion could mean seven or eight billion euros worth of investments.
“This is money that can make a real difference but we should be clear that it is still only a fraction of the huge amounts of funding that is required to modernize economies and bring them into the global supply chain,” Mirow said.
An EBRD spokesman told AFP that the bank expects to reach the €2.5 billion investment target “incrementally over the next two or three years”.
The London-based EBRD is owned by 61 governments as well as the European Commission and the European Investment Bank.
The institution, which invests in private enterprises together with commercial partners, operates in 29 countries from central Europe to central Asia, including Hungary, Kazakhstan, Russia and Turkey.