Since its establishment in 1991 the EBRD has become the largest financial investor in a region that stretches from central Europe and the Western Balkans to central Asia. With the ability and willingness to bear risk on behalf of its clients and working together with the private sector, the EBRD invests in projects, engages in policy dialogue and provides technical advice that builds sustainable and open-market economies. In all its operations the EBRD follows the highest standards of corporate governance and sustainable development. It maintains a close political dialogue with governments, authorities and representatives of civil society to promote its goals.
The EBRD is owned by 64 countries and two intergovernmental institutions (the European Union and the European Investment Bank). As well as being the largest single foreign investor in its region of operations, the EBRD also mobilizes significant foreign direct investment into its countries of operations. It invests mainly in private enterprises, usually together with commercial partners. It provides project financing for the financial sector and the real economy, both new ventures and investments in existing companies. It also works with publicly-owned companies to support privatization, the restructuring of state-owned firms and improvement of municipal services.
In 2011, the EBRD began laying the foundations for the expansion of its operations to the southern and eastern Mediterranean (SEMED) region. This is part of the international community’s support for the emerging Arab democracies. In 2012 the Bank implemented its expansion and initiated investments in the SEMED region.
The EBRD is a project finance institution and its main TCB-related activities in its countries of operations are the following:
- Trade financing: Through the Trade Facilitation Programme (TFP), designed to overcome counter-party risks in trade credits, the EBRD has supported over 11,000 transactions for a total of €7 billion since the Programme was launched in 1999. In addition to providing trade finance guarantees, the EBRD also extends short-term loans to selected banks in its countries of operations. These loans are structured to fund trade-related advances to local companies exclusively for the purpose of pre-shipment finance, post-shipment finance and other financing of working capital necessary for the performance of foreign trade contracts. Credit agreements are signed between the EBRD and these selected banks.
- Investment in trade-related infrastructure: The EBRD supports investments in cross-border transport infrastructure, including roads, railways, airlines, ports, shipping and logistics companies and associated equipment, as well as in regional power pools and projects to promote regional energy markets. In 2011, for example, regional integration in the road sector was a key focus, with€107 million provided to complete Corridor X in FYR Macedonia (a key trans-European network which will ensure stimulation of trade flows in the Western Balkans and beyond).
- Advisory services and financing to enterprises: The EBRD also provides both advisory services and financing to export-orientated enterprises that improve product quality to internationally accepted standards. In the agricultural sector, EBRD has developed a financing structure where loans are secured by commodities and provided through local banks. This significantly reduces the risks for commercial banks and eases access to financing by farmers, food processors and traders. In order to widen its outreach to smaller enterprises, the EBRD provides financing to local financial intermediaries dedicated to micro, small and medium-sized enterprises.
The EBRD works in partnership with multilateral institutions, including the World Bank, UN agencies, the European Commission and other financial organizations such as the Nordic Investment Bank (NIB) and the Nordic Environment Finance Corporation (NEFCO).
TCB activities described in this guide
- Conferences and events
- The Enterprise Growth Programme (EGP) and Business Advisory Services (BAS)
- Infrastructure and transport policy
- Acquisition and construction of cargo vessels
- Trade Facilitation Programme (TFP)
- E-Learning school in trade finance
- The Multilateral Carbon Credit Fund (MCCF)
- Technical Cooperation Funds Programme (TCFP)