Shareholders of the European Bank for Reconstruction and Development (EBRD) approved today in Zagreb an increase in the bank’s capital by 10 billion euros, thereby paving the way for greater investments, Christine Lagarde, Chair of the EBRD Board of Governors and French Minister of Finance, reported at a press conference this evening.
The EBRD Board of Governors approved the capital increase from 20 billion to 30 billion euros in the context of the overall agreement on the bank’s strategy for the period from 2011 to 2015, Lagarde said."I am very happy that the EBRD has shown a sense of responsibility regarding the use of its resources.", Lagarde stated. EBRD President Thomas Mirow emphasized that the decision to increase capital is a strong signal to 61 countries and two international institutions, members of the EBRD, that they will continue to show solidarity towards developing Europe and Central Asia. Mirow noted that almost every individual shareholder will face challenging budgetary decisions in the coming year and that most countries will have to make tough choices, cut costs, and possibly raise taxes and levies.
"We will continue to invest efforts to improve the lives of people in the countries where we operate, even in these difficult times, noting that tough decisions will follow before the crisis passes," Mirow added. The EBRD’s capital has been increased by 50 percent, from 20 billion to 30 billion euros, thus paving the way for growth in EBRD investments over the next five years. The EBRD strategy for the next five years anticipates continued high demand for the bank’s investments as financing from other sources is expected to remain significantly below pre-crisis levels in the foreseeable future. The capital increase will enable annual investments of 9 billion euros until 2012 and 8.5 billion euros in each of the next three years. The EBRD invested a record 8 billion euros in 2009. The EBRD expects to invest more than 50 billion euros from 2010 to the end of 2015, which is more than the total amount the bank has invested since its inception in 1991. If related investments from commercial and other partners are included, the total investment in the region, across 29 countries from Central Europe to Central Asia, could reach 150 billion euros during this period, predicts the EBRD. (H)
