European Bank For Reconstruction And Development Research Articles

The Impact of Mental Models on the Transition from Communism to Capitalism. The Comparative Case Study of Azerbaijan and Poland

The purpose of the article. The breakdown of the so-called Eastern Bloc, the disintegration of the Soviet Union, and the demise of communism fueled transition processes in Central and Eastern Europe, Western Asia, and Central Asia. The great majority of transformation difficulties across different areas demonstrate that when pursuing the process of a structural change, it is important to take into account diverse sets of formal and informal institutions preserved in each country. Each country has a unique set of formal and informal institutions. These differences are easily observed between Poland and Azerbaijan. The aim of this paper is to compare and contrast the outcomes of Poland and Azerbaijan's transitions from communism to capitalism and to identify the primary factors driving these two different transformations. Methodology. The paper presents two complementary methods to compare the transitions from communism to capitalism in Poland and Azerbaijan. The first method involves secondary analysis, where existing data from reputable sources such as the European Bank for Reconstruction and Development (EBRD) database, the Bertelsmann Transformation Index (BTI), and country reports are compiled to provide insights into economic, political, and social indicators. Additionally, a comparative case study approach is employed, using Geert Hofstede's six cultural dimensions framework to explore the cultural influences on transition outcomes. By integrating these methods, the study aims to offer a comprehensive analysis of the transformation processes in Poland and Azerbaijan. Results of the research. The results of the analysis presented in the paper support the hypothesis that the historically-shaped differences in mental models and strong ties to international protectors determined the paths of transformations in Poland and Azerbaijan. The primary similarities and contrasts in the mindset are justified by the colonial or imperial history of the nations.

Transnational governance standards in ensuring sustainable development and operation of hydropower projects in transboundary basins

The notion of “transnational” law encompasses a sophisticated corpus of globally applicable rules, standards and safeguards, often informal in origin, which are widely accepted around the world and supported across a range of business sectors and civil society constituencies. The recent proliferation of such “transnational” law extends to the hydropower sector, where normative standards and safeguards increasingly apply to promote and certify sustainable practices in the development and operation of hydropower projects. Such projects are associated with significant environmental and social impacts and the projected increase in hydropower investments, mainly in emerging economies, will require effective supplemental regulatory tools. Many such projects will be located in, or impact upon, international rivers, thereby adding a further layer of complexity regarding their effective regulation and increased the risk of inter-State disputes over the equitable use of shared waters. Such complexity and risk will be exacerbated by increased uncertainty due to climate change. Thus, the existence of widely accepted transnational standards, which are relevant and applicable to hydropower development globally, can play a key role in building trust between watercourse States and in promoting greater transboundary water cooperation. This article explores the potential role of transnational standards in improved regulation of environmental and social impacts associated with hydropower projects located on international watercourses and the extent to which such standards cohere with established and emerging requirements of international water law. It thus examines the synergies arising between these informal and formal regulatory frameworks with a view to developing a better understanding of their interaction in practice. In so doing, it focuses on two key categories of applicable transnational regime: a sustainability certification and labeling scheme dedicated to hydropower projects and operated by the Hydropower Sustainability Council; and MDB environmental and social safeguard standards imposed upon major water-related projects, including hydropower projects, particularly those adopted by the World Bank and the European Bank for Reconstruction and Development (EBRD).

Os Bancos de Desenvolvimento multilaterais, nacionais e subnacionais: os países emergentes e o financiamento ao desenvolvimento

Development Banks are financial institutions designed to promote socioeconomic development, infrastructure, reduce inequalities and provide working capital to increase the country’s economic activity. Brazil stands out for the presence of three national development banks: (i) National Bank for Economic and Social Development (BNDES); (ii) Bank of the Northeast of Brazil (BNB); and (iii) Bank of the Amazon (BASA). In addition, there are three subnational banks: (i) Minas Gerais Development Bank (BDMG); (ii) Regional Development Bank of the Far South (BRDE), and the Espírito Santo Development Bank S.A. (BANDES). At the international level, two major groups of multilateral development banks are recognized: (i) the traditional banks that were created in the second half of the 20th century, such as the World Bank, the Inter-American Development Bank (IDB), the Asian Development Bank (ADB), the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB); and (ii) the new multilateral banks, created in the 21st century at the initiative of emerging countries, such as the New Development Bank (NDB) or Bank of the BRICS, the Latin American Development Bank or Andean Development Cooperation (CAF) and the Asian Infrastructure and Investment Bank (AIIB). Emerging countries, either by creating national and subnational banks or by taking the initiative to establish new multilateral banks, represent an important group of states to contribute to increasing of investment availability for development and infrastructure.

Ініціативи міжнародних організацій для розвитку інструментів сталого фінансування

Introduction. The COVID-19 pandemic and the full-scale invasion of the Russian Federation have created many difficulties for doing business in Ukraine. However, despite the existing challenges, representatives of domestic business continue to adhere to the standards of sustainable development. In turn, financial institutions, as well as the financial regulator, continue to stimulate mechanisms and develop trends in sustainable financing. Thus, the National Bank presented the Policy on the development of sustainable financing for the period until 2025. The development of the policy was carried out in the framework of cooperation with the International Finance Corporation, whose experts emphasized the need to develop a roadmap for sustainable financing, which will allow combining the capabilities of the private and public sectors in order to strengthen the practices of sustainable financing with the support of the state. Accordingly, the implementation of sustainable development initiatives in the financial sphere requires state support, and also involves the application of the experience of international organizations and the study of successful international practices of sustainable financing. Problem Statement. Assessment of the role of international organizations in the development of tools for sustainable financing at the level of national economies. The purpose is to substantiate the essential characteristics of sustainable financing tools, evaluate successful practices of strengthening sustainable financing within the framework of initiatives of international and European organizations with the aim of applying them in the process of building a domestic sustainable financing policy and strategy, forming and applying roadmaps for financing sustainable development priorities based on innovative tools. Methods. General scientific and special methods were used, in particular: scientific abstraction and epistemological (content) analysis, synthesis, induction and deduction, analogies and systematization, system-structural analysis, expert evaluation method, index method and grouping method. Results. The article examines the modern characteristics of sustainable financing and its evolution, the typology of sustainable financing. The basics of the spread of sustainable financing practices in Europe, as well as the essential characteristics of sustainable financing instruments (social and green bonds, social and green loans, sustainable development bonds and loans) are considered. An assessment of the volume and distribution of sustainable development financing instruments at the international level was made. At the international level, in connection with the diversification of the priority areas of attracting financial resources by the World Bank Group, there was a need to create separate organizations aimed at financing the priorities of sustainable development. In particular, one of such separate institutions is the International Finance Corporation (IFC). Accordingly, the article emphasizes the inclusive business model of IFC. In turn, the European Bank for Reconstruction and Development (EBRD) was created based on the combined efforts of a number of countries around the world, the European Union (EU) and the European Investment Bank (EIB). The article focuses on the strategic areas of activity and products of the EBRD. A guide to the application of international experience of sustainable financing in Ukraine was considered. Conclusions. Thus, the study of the initiatives of international organizations in the development of sustainable financing tools makes it possible to draw a conclusion about the role of the interaction of the state, business and international organizations in order to accumulate efforts to strengthen sustainable financing through the use of innovative tools, the creation of appropriate policies and the development of sustainable development roadmaps. In Ukraine, the policy of sustainable financing is based on the cooperation of the NBU and the IFC and is implemented through a road map, which is of an applied nature and is intended to monitor the business activity of the NBU in terms of the formation of predictable and stable regulatory foundations with the aim of spreading sustainable financing in the country with specific time norms and taking into account the need to ensure the consistency and adaptability of the banking system and non-bank financial institutions to changes.

Quantifying the Saved Social Costs of the Solar Energy Projects Funded by the EBRD in Egypt

The world is changing into a village due to the common need to meet the population’s energy demands. Scholars link such transformation with energy’s relevance in meeting economic and social development and improving human welfare. This paper aims to evaluate the social cost savings of solar energy projects funded by the European Bank for Reconstruction and Development (EBRD) in Egypt. The paper provides an overview of the EBRD's involvement in promoting renewable energy in Egypt and its impact on the country's energy mix. The paper analyzes the three solar energy projects funded by the EBRD and their contribution to reducing carbon emissions and promoting sustainable development. Through calculating the avoided carbon dioxide (CO2) emissions and the saved social costs of these projects, the study concludes that the contribution of the EBRD is substantial, which highlights the importance of partnering in renewable energy to achieve sustainable development goals and mitigate climate change.

Bankruptcy and international intervention: The case of Addiko bank

AbstractIn 2014, the Austrian bank Hypo Group Alpe Adria was purchased by the American banking group Advent International, and the European Bank for Reconstruction and Development (EBRD) and re‐branded as Addiko bank. In this paper, I explore how this purchase of Addiko Bank by an international multilateral development bank (MDB) affected exporting firms in Croatia. Using a difference‐in‐differences specification to investigate whether there was a meaningful effect of this turnover on firm performance, I find that the turnover of Addiko bank led to a $160,000 decrease in loans taken out by firms. However, this effect seems to occur immediately after the turnover, and vanishes over time. This effect is seen among domestically‐owned firms and non‐manufacturing firms, but not multinational affiliates and manufacturing firms. Additionally, I find no effect of this turnover on firm revenues. These results indicate that after an initial period of turmoil, the intervention by EBRD and Advent International had no lasting negative effects on firms in Croatia. The intervention by a MDB can help reform a financial sector and will not necessarily lead to detrimental effects at the micro‐level.

From the Wieser report to Team Europe: explaining the ‘battle of the banks’ in development finance

ABSTRACT The European Union (EU) and its member states are the world’s largest development donor, but the European financial architecture for development suffers from well-documented problems of fragmentation. EU member states’ decision to convene the Wieser Group in April 2019 raised expectations over rationalising the roles of the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD). However, the Council of the EU showed little enthusiasm for the group’s call to create a single entity for external development finance. Twelve months later, member states endorsed Team Europe, an alternative approach which mobilises the resources of the EIB, the EBRD, the European Commission and national development finance institutions in support of shared development goals. This article seeks to explain why the Council ultimately preferred Team Europe’s coordinated approach to the Wieser Report’s centralised vision of a European Climate and Sustainable Development Bank. In keeping with new intergovernmentalism, we find that member states’ willingness to cooperate but reluctance to delegate, and the aim of EU institutions to protect their turf, favoured Team Europe. We see few reasons to expect radical changes in this domain despite continued doubts over the effectiveness and coherence of European development finance.

Capitalizing on crises: the EBRD, Jordanian state and joint infrastructure fixes

In 2011, the European Bank for Reconstruction and Development (EBRD) extended its mandate beyond Central and Eastern Europe (CEE) to the Middle East. Since then, it has supported financial institutions, private sector involvement, energy production and, most recently, infrastructure and public service reforms. While the EBRD presents itself as supporting the region's economies in light of the refugee ‘crisis’, I question the power relations driving its recent public investments there. I situate them within the context of global capitalism’s crises since the Great Recession and MDBs’ development agendas in the Middle East, specifically increased aid since 2011. I argue that, jointly advanced by the EBRD and Jordanian state, the EBRD’s public loans in Jordan offer fixes for capitalism’s crises to the benefit of donors, the state as well as private investors. More specifically, the EBRD’s projects and emphasis on the refugee “crisis” entrench and justify market-based neoliberal reforms in Jordan’s infrastructure and public services, opening them up to investment and expanding accumulation at the expense of public interest. The Jordanian state is an active partner and beneficiary of these projects, not only establishing the necessary regulatory frameworks for them, but also aligning them with its own development agendas and interests.

Mandate management: a field theory approach to the EBRD’s adaptive practice in Egypt

The European Bank for Reconstruction and Development (EBRD) was created in the early 1990s to promote the transition to a market economy and advance democracy in the post-communist countries of East Central Europe. How and why did this international organization, established for an entirely different purpose, then become an active investor in Egypt? Building on field theory, we explain the EBRD’s move to Egypt as an attempt to overcome the hysteresis effect of its anachronistic operational logic (habitus) within a changing field. Once in Egypt, the EBRD aspired to leverage its symbolic capital of technical assistance, democratic commitment and the privileging of the private sector. However, given Egypt’s increasingly autocratic and state capitalist evolution, it found delivering on its symbolic capital problematic. Its solution was to adapt to the very active European development finance field’s modalities. However, the European field’s logic ultimately de-prioritized democracy, human rights promotion, and poverty reduction and instead focused on sustainable investment, migration mitigation and containing Europe’s geo-economic rivals. In our case study, we demonstrate that the EBRD operated deftly within this field, while it also gained permission and even reward for its mandate management. It is a problematic finding for the future of the EU development policy.

THE EBRD LITERATURE PRIZE: EXPLORING GEOGRAPHICAL AND LINGUISTIC DIVERSITY IN A NEW TRANSLATION AWARD

This contribution explores a new addition to the range of international awards available for literary translation into English, the EBRD Literature Prize. It was founded by the European Bank for Reconstruction and Development (EBRD) with the key objective of broadening the range of translated literatures available to the wider English-speaking public. The Prize was created in 2017 and it has been awarded four times to date. Accordingly, building on a brief overview of the broader role of prizes and awards within the global literary translation market, the genesis and rationale which underpin the EBRD Literature Prize are presented and highlighted. This information provides the basis for the subsequent exploratory analysis, which uses the regional groupings of the EBRD’s countries of operations as a preliminary framework of reference. As such, using the relevant publicly-available data, the geographical and linguistic origins of the translated literary works which have been shortlisted and longlisted for the Prize are outlined and discussed. The main aim is to determine whether any specific trends can be identified in the relevant works. Subsequently, the findings of these observations are presented, and, in recognition of the exploratory nature of this contribution, some possible indicators for additional research on the topic are offered.

Barriers to firms’ energy efficiency in transition countries

ABSTRACT This study seeks to explore the firm’ barriers of energy efficiency in a set of 28 Transition economies exploiting the enterprise survey data collected by the European Bank for Reconstruction and Development (EBRD) jointly with the European Investment Bank (EIB) and the World Bank Group (WBG). Based on the Ordinary Least Squares (OLS) regression model and on the construction of three different indicators to evaluate the energy efficiency, we find that the barriers to the adoption of energy efficiency measures mainly lack financial resources and profitability. Findings obtained from the interactions are also worthy of note. In particular, we find that the absence of profitability starts being stronger for non-EU countries. Instead, there is no evidence of heterogenous effects for industry sectors.

Energy Saving in Transition Economies: Environmental Activities in Manufacturing Firms

This study seeks to explore the relationship between active environmental activities and energy saving in firms operating in a set of Transition countries. For this purpose, we exploit the enterprise survey data collected by the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB) and the World Bank Group (WBG). Employing a probit regression model, the main finding shows a positive relation between environmental practices and energy saving, controlling several firms’ characteristics such as size, affiliation, credit line, ownership status and age. The results are also confirmed when we perform the robustness check. Interestingly, medium and small firms appear to save more energy than large ones.

Global Climate Financing of Multilateral Development Banks - An Analysis

The human Community in earth understood theemergency need to integrate forces to avert dangerous climate change. This requires mobilising financial resources from a wide range of sources, public and private, bilateral and multilateral, including alternative sources. This makes it increasingly important to track and report financial flows that support climate change mitigation and adaptation to create trust and accountability with regard to climate related investment. Climate Financing by Multilateral Development Banks (MDBs) comprising the African Development Bank (AFDB) the Asian Development Bank (ADB) the European Bank for Reconstruction and Development (EBRD) the European investment Bank (EIB) the inter-American Development Bank Group (IDBG) the world Bank (WB) and the International Finance Corporation (IFC). The vision of Paris agreement’s in financial flows consistent with low greenhouse gas emissions and climate- resilient development plays a significant role in the MDBs work to improve tracking and reporting. At COP 24 in December 2018 the MDBs reinforced their commitment to combating climate change presenting joint approach that will align their activities with the goals of the internationalagreement. Based on the increasing role of MDB Banks in Climate Financing to different regions and sectors this paper focuses on the objectives such as To study climate Financing of Multilateral Banks and its role in minimising global CO2 emissions, To find the share of Adaptation Financeto total climate finance and also to determine the share of different banks in total adaptation funding. Based on the share, the moving pattern of financing by each group of banks would be analysed, to study the share of adaptation finance to total investments of funds in different sectors. The moving pattern of financing in different regions and sectors would also be observed. In order to study the variations in total amount allotted, amount for adaptation and amount on mitigation, Bank wise, Region wise and sector wise would be analysed. Data are collected from secondary sources for the years 2011 to 2018 from the reports of Multilateral Development joint report on climate finance. Regression was used to study the variation in variables such as total climate finance given by MDBs, Finance to Adaptation and Mitigation, Region wise financial distribution and sector wise allocation. The result of the study found that MDB banks are more innovative enough to distribute climate finance to various regions and to various sectors by pooling finance from various sources. Finance is given to countries to implement Adaptation and Mitigation measures separately. Comparatively finance to Adaptation is less to Mitigation. To utilize the Climate Finance more effectively MDB banks have to follow the approach of synthesizing both Adaptation finance and Mitigation Finance.

How Digital Are Albanian Esnterprises: A Microeconomic Analyses

This paper focuses on the analyses of the digitalization of enterprises and its performance impact in Albania. Using data from 2019 Enterprise Surveys (ES) we try to give answer questions related to digitalization that characterize Albanian enterprises. The survey was a shared project of the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), and the World Bank Group (WBG). The data are collected in Albania between January and May 2019. The objective of the survey is to better understand firms` experience in the private sector. Collected data are based on firms’ experiences and perceptions of the environment in which they operate. The paper uses these specific questions to study Internet adoption. ES questionnaires focus on the following questions: (1) Does the firm have a high-speed Internet connection on its premises? (2) Does the establishment have its website? The dependent variable is the performance of the firms measured in terms of sales growth and labor productivity, while the vector of independent variables is composed of enterprise characteristics such as firm size, ownership structure, legal status, region, etc. Moreover, dummy variables are used to capture access to formal banking services and gender ownership.

Interview of Jacques de Larosière: In search of a better world financial order

Jacques de Larosière (born 1929) played for more than half a century an influential role on the international monetary scene. He was Director of the French Treasury, Managing Director of the International Monetary Fund, Governor of the Banque de France and President of the European Bank for Reconstruction and Development (EBRD). In 2008, at the age of 79 years, he chaired the so-called De Larosière Committee which provided the blueprint for a fundamental reform of financial supervision in the European Union. Highlights of his career were the management of the Mexican debt crisis in the 1980s and his role in the process of economic and monetary integration in Europe, especially as a member of the Delors Committee. In his analyses he focuses on the "financialization" of our econ-omies and the ensuing problems with debt and asset price bubbles, for which the breakdown of the Bretton Woods system was an important cause. As part of a research program on collecting memories, this paper publishes the results of several interviews and discussions with him.

International Financial Institutions Ask to Contribute to Climate Protection

The aim of this article is to show in which way international financial institutions (IFIs) can contribute to climate protection projects. The principles of IFIs’ project cycles are explained in the context of the new blending tool. The cooperation with other donors stands in the centre of EU project funding and the notion of leveraging allows to quantify the cooperative effect among different donors. The bulk of this article describes the most relevant IFIs and national development banks with an international focus: Green Climate Fund (GCF), European Investment Bank (EIB), European Bank for Reconstruction and Development (EBRD), French Development Agency (AFD), German Development Bank (KfW), World Bank (WB), Asian Development Bank (ADB), and the Asian Infrastructure Investment Bank (AIIB). For all these IFIs, descriptions are provided and their main fields of actions identified. The procedure of application (the “project cycle”) is illustrated and an overview of their strategies is given. Thus, this article seeks to provide practical guidance on how to cooperate with IFIs and to direct funds into substantially valid and responsible climate projects.

Regulations and Corporate Environmental Responsibility: evidence from a panel of firms in Transition economies

ABSTRACT This study investigates how a set of regulations influences the pro-environmental actions of firms in a panel of 25 Transition Countries. For this purpose, we use the enterprise survey data developed by the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB) and the World Bank Group (WBG). Based on a logit modelling and on the construction of different indicators characterizing the environmental actions of the firms, we find that regulation positively affects the decision of firms to implement an eco-action. Results are confirmed when we examine the different eco-action categories. Findings obtained from the interactions are also worthy of note. In particular, we find that board of directors are more prone to consider shareholder interests, and a strong network effect emerges between EU candidate countries and EU economies.

Policy Norms, the Development Finance Regime Complex, and Holding the European Bank for Reconstruction and Development to Account

AbstractCreated to facilitate the transition of economies of Central and Eastern Europe towards democracy and the free market, the European Bank for Reconstruction and Development (EBRD) is a regional institution in the development finance regime complex. This article examines how the EBRD’s independent accountability mechanism (IAM) emerged and changed to demonstrate how policy norms filter through regime complexes. This is important because new ideas can change behavioural expectations and institutional practices across a complex. Tracing where the idea originated from and how it took hold is therefore central to understanding member state interests, the EBRD’s response considering its organisational preferences, and how the policy norm solidified through inter‐institutional learning. This deepens our understanding of the development finance regime complex in two ways: first, it, shows how ideas can filter through to seemingly independent institutions via member states, bureaucrats, and stakeholders. This supports the argument that the development finance regime complex is coherent with increasingly consistent rules and obligations. Second, it reminds us not to reify states; while they demanded institutional change nonstate actors influence what constitutes appropriate behaviour for development financiers.

Assessing Physical Climate Risks for the European Bank for Reconstruction and Development's Power Generation Project Investment Portfolio

This paper introduces a new method to quantify physical climate risks for power generation projects at the portfolio level. Co-developed by WRI and the European Bank for Reconstruction and Development (EBRD), the approach is designed to be flexible enough to work with portfolios with different levels of data availability, leverage the latest science in climate and hydrology, and use machine-learning techniques such as recurrent neural networks.

Implementation of the green governance concept and green management practices in corporations of EBRD regions – selected issues

Purpose: The purpose of the paper is to identify the level of involvement of the corporations of the EBRD regions in the implementation of the concept of sustainable development, and to evaluate the applied solutions in the field of green management. Design/methodology/approach: The research methods used in the paper include the review of Polish and foreign literature, and the analysis of data from secondary sources. The desk research analysis was conducted on the basis of numerical information contained in the publication entitled "Transition Report 2019-20" and presented on the website of The European Bank for Reconstruction and Development (EBRD). Findings: The result of the conducted research include the indication of the corporations in the countries of the EBRD regions that are leaders in the field of green governance and green management, and identification of factors and the extent to which they have an impact on the implementation of sustainable development postulates. Research limitations/implications: The presented findings encourage further research to determine the causes of drastic differences in the field of green governance and green management in the studied corporations of the EBRD regions and the possibility of limiting them. Practical implications: The analysis and evaluation of the implementation of the main practices of green management in the corporations of the EBRD regions allow to identify leaders in this area and apply the model of their operation (benchmarking) to improve the position of the organizations that show deficits. Social implications: The use of the presented data, analyses and conclusions should imply further actions and strategies in enterprises necessary to implement the concept of sustainable development. Originality/value: The paper synthetically presents the significance of the concept of green governance and the application of green management practices by corporations from the EBRD regions