The European Bank for Reconstruction and Development (EBRD)

The European Bank for Reconstruction and Development was established during the collapse of the communist regime in Eastern Europe, in 1991. At that time, the former states of the Soviet Union urgently demanded support for the formation of an updated private sector under the reigning democracy. At the moment, the EBRD's tools are being used effectively to establish a market economy and to adapt to democracy in 34 states around the world.

The main activities of the EBRD

The European organization works only for commercial purposes, charity is not included in its tasks. EBRD projects only loan specific. In addition to targeted lending, the bank conducts direct investment, provides technical support. The authorized capital of a financial institution is equal to $ 10 billion, and the ECU level corresponds to $ 12 billion. The controlling stake in the organization (51%) is the property of the EU countries. Contributions to the organization are accepted in any freely convertible currency. The main goals for which the European Bank for Reconstruction and Development was originally formed are:

• Financing of road transport supplies.
• Financing and supply of equipment.
• Providing technical assistance to state and commercial structures, enterprises.
• Lending to the private sector, which accounts for about 60% of the total amount of loans granted.

Subtlety of the EBRD's work

As the unit of account of the bank, the US dollar and ECU are used together with the Japanese yen. The branches of the financial giant open and provide a full range of services in all countries that participated in the establishment of the institute. Offices operate on the territory of Russia and Ukraine. The Bank carefully monitors the targeted use of all the funds it provides as loans. In addition to financing, the International Bank issues recommendations and organizes a variety of courses to train bankers and managers. The Institute provides professional assistance in the distribution of food. It is worth saying that the financial institution does not have its own funds to provide technical support. He accumulates funds for this purpose through funds operating in the territory of the EU countries.

Specificity of activity

The main format of EBRD financing is loans and investments in equity or guarantees. The main office of the organization is located in London. Important players in the association are not only the states of the world, but also the European Community with the European Investment Bank. Each member state of the organization (58 countries in total) has its representative on the board of governors and on the board of directors. The main advantage of the European Bank for Reconstruction and Development is its deep knowledge of the region in which it is planned to conduct financial operations. The management of the institution is perfectly familiar with all the complexities and potentials of the countries with which partnership is being conducted. The EBRD (the bank) offers its support only to those states that follow a market economy, pluralism or multi-party democracy. Another strength of the institute is the ability to take risks that significantly expand the boundaries of commercial potential. The EBRD meets the highest AAA credit rating, which makes it possible to attract capital on the international market at the most favorable terms.

Functions and not only

The International Bank provides comprehensive support to the participating countries in carrying out not only structural but also sectoral reforms with demonopolization and privatization, which are aimed at integrating the private economy into the world economy. To implement this task, active assistance is provided.

1. Small and medium enterprises are assisted in organizational matters, in the aspect of modernization and expansion of production, in the construction of competitive policies.
2. The Bank promotes the mobilization of both foreign and national capital. There is support in the competent management of funds.
3. The organization promotes investment in production to create competitiveness and to improve the quality of life, improve productivity.
4. Helps in technical training, in financing, in the implementation of projects, in stimulating the capital market, in environmentally sustainable development, in realizing large-scale projects that involve several recipient countries at the same time.

Commitment to the environmental dimension

In addition to multilateral lending, the EBRD is an active supporter of clean prosperity. Each of the Bank's projects is subject to stringent requirements in the aspect of nature protection. The financing of municipal and other infrastructure improvements is being systematically implemented. Energy-saving technologies are financially encouraged. The nuclear safety area is another priority area of the EBRD's activities. Russia and some other countries in this matter are in the bank under close supervision. The financial institution is responsible for the allocation of funds that are created to minimize hazards in the operation of nuclear power plants in different regions of the world. The International Bank, working simultaneously with many countries of the world, has its own approach to each state. He not only develops, but also implements programs for the needs of each participating state of the system.

EBRD in Ukraine

The European Bank for Reconstruction and Development is one of the largest investors in Ukraine. The financial institution offers its support in various fields of activity, including the financial sector and small commercial companies. Priority areas for the financial institution are: agriculture and transport infrastructure, municipal services and energy, television communications. The Chernobyl Shelter Fund is also under the control of the EBRD. Ukraine receives assistance from the organization in the aspect of restoring Chernobyl, its transformation into an absolutely safe and ecologically clean zone.

Actual help to Ukraine

The EBRD's main office in Ukraine operates in Kiev. The staff of experts includes the best experts from different sectors of the economy. Constantly maintained an active dialogue with the government of the state. The European bank makes a great contribution to the prosperity of business and the improvement of the investment climate. In 2015, the financial institution plans to invest about 3.5 billion dollars in projects on the development of the state's economy. The funds are planned to be used for Ukrainian pipes, for increasing the number of jobs, for the development of Ukrainian companies, for infrastructure projects, for education and medicine. This will be the most global investment that will restore the state's productive forces .

EBRD and Russia

EBRD on the background of recent events and the economic situation in Russia presented an updated but worsened forecast for the development of the economy. In 2015, according to the representatives of the bank, GDP is expected to decline by about 4.8%. The unhealthy investment environment, formed after the imposition of sanctions on the state in 2014, was only exacerbated by the decline in the cost of oil. Consumer demand will be lowered due to depreciation of the national currency, due to the increase in interest rates on loans. Unavailable retail loans will be prohibitive for ordinary families, which will cause a decline in demand that fell by 50% last year. The crumbling economy of Russia will impose a negative impact in 2015 on the development of such countries as Kazakhstan and Azerbaijan, Turkmenistan and Belarus, Armenia. According to the EBRD's forecasts, Russia can get into a much worse situation if oil prices continue to fall, and the conflict with Ukraine will worsen.