The activities of the European Bank for Reconstruction and Development (EBRD) in 2013-2014
- Parliamentary Assembly
debate on 2 October 2014 (35th Sitting) (see Doc. 13594, report of the Committee on Political Affairs and Democracy,
rapporteur: Mrs Cheryl Gillan). Text
adopted by the Assembly on 2 October 2014 (35th Sitting).
1. The Parliamentary Assembly has
reviewed the activities of the European Bank for Reconstruction
and Development (EBRD) for the period 2013-14 in the light of the
reports by the Bank. In line with the last report, the Assembly
has sought to make the debate more political and to focus more on
a political assessment of the work of the Bank.
2. The Assembly recalls that the Agreement Establishing the European
Bank for Reconstruction and Development includes a significant political
element, in that it specifies that the Bank may conduct its operations
in countries of central and eastern Europe which are not only proceeding
in their transition towards market-oriented economies, but are also
committed to and applying principles of multiparty democracy and pluralism.
3. According to the preamble to the agreement, the successful
transition of member countries to market-oriented economies is closely
linked to parallel progress towards democracy and the rule of law.
Thus, the political aspect of the Bank’s mandate extends to all
elements of its objectives and should be monitored and promoted
by the Bank as part of the process of assisting the transition of
its countries of operations to market economies.
4. In the co-operation agreement concluded between the Council
of Europe and the EBRD in 1992, the two organisations agreed to
exchange information, particularly regarding the monitoring and
assessment of the development of democracy in central and eastern
Europe. The Assembly supports the activities of the EBRD by providing
a parliamentary oversight of the EBRD’s operations.
5. The time period covered by the current overview of the activities
of the EBRD (2013-2014) has witnessed the beginning of recovery
from the financial crisis which had hit especially hard in Europe.
The sovereign debt crisis in a number of European States is now
under control, but confidence in the single currency of the eurozone
has not been fully restored. Austerity programmes have continued
to be implemented throughout the review period and the economic
slowdown in the euro area, and western Europe in general, has had
a negative impact on the countries of the transition region.
6. Political uncertainty is a key factor affecting growth, and
the outlook for economic growth in 2014 and 2015 in the transition
region has been negatively affected by economic factors and the
geopolitical tensions between Ukraine and Russia. While in Russia
economic growth is forecast to come to a halt in 2014, and to remain
low in 2015, Ukraine is expected to suffer from severe output losses
in 2014 and stagnate in 2015. Increased geopolitical tensions between
Russia and Ukraine could also impact upon neighbouring countries and
no doubt the effect of the latest sanctions on Russia and of Russian
sanctions on western economies will figure largely in the next report.
7. The prolonged period of slower growth that has followed the
global financial crisis has affected the prospects of the EBRD transition
region in achieving convergence with the living standards of advanced
market economies. On the other hand, the increase in long-term unemployment
brought about by the crisis and the prolonged period of fiscal austerity,
often recommended by supranational bodies, is eroding public support
for market-oriented reforms and some of the most advanced countries
in the transition region have even experienced reform reversals.
It is possible that support for democracy may also suffer as opposition
to the effects of the austerity programmes on growth and jobs mounts.
8. The Assembly welcomes the expansion of the EBRD’s activities
to the countries of the southern and eastern Mediterranean (SEMED)
in the past two years, with Jordan, Morocco and Tunisia becoming
full countries of operations and Egypt being a potential country
of operations. Although the situation in these countries is very
different from that in central and eastern Europe twenty-five years
ago, the Assembly believes that the experience of the EBRD in helping
countries make the transition to open market economies can be of valuable
assistance also in the countries of the SEMED.
9. The EBRD should seek to share its experience and expertise
in supporting transition with other countries as well, including
outside its current region of operations. At the same time, regardless
of continuing expansion to the south and the east, the EBRD should
maintain strong support for economies of its “old region”.
10. The Assembly took note of the revision and updating by the
EBRD of the methodology to assess the compliance of its countries
of operations with the political aspects of the EBRD’s mandate,
notably on the basis of: representative and accountable government;
civil society, media and participation; rule of law and access to
justice; and civil and political rights. It regrets, however, that
many of the EBRD’s countries of operations do not seem to be committed
to, and are not applying, principles of multiparty democracy and
11. The Assembly looks forward to the effective implementation
of this new methodology and encourages the EBRD to strengthen its
co-operation with the Council of Europe – and in particular with
the Assembly – in making and monitoring its assessments.
12. Finally, the Assembly notes the recent criticism concerning
the lack of transparency of the EBRD and encourages it to start
publishing more comprehensive information in line with international
standards and to inform it of the measures it takes to this effect.