Odile Renaud-Basso, President of the Berd, in Brest, Finistère, February 11, 2022 (POOL/AFP/Archives/Ludovic MARIN)
The European Bank for Reconstruction and Development (EBRD) announced on Monday “suspending with immediate effect” the access of Russia and Belarus to its financing and expertise, in the wake of the invasion in Ukraine.
This decision “means that there can be no new funding for technical cooperation projects or activities” from the EBRD in Russia or Belarus, the institution said in a statement.
The bank, which had already announced that it was closing its offices in Moscow and Minsk, indicates that it “reserves the right to suspend or cancel new financing installments on existing projects”.
The EBRD’s ongoing projects in these two countries represent around 1.5 billion euros, a source familiar with the matter told AFP.
The announcement came as the European Union was discussing additional sanctions against Moscow on Monday, after the discovery of a large number of civilian bodies in the kyiv region, particularly in Boutcha, after the Russian withdrawal.
“It is sad to have come to this after so many years of cooperation and activity in these two countries”, commented Odile Renaud-Basso, President of the EBRD, quoted in the press release. “But Russia’s war on Ukraine has left us with no choice but to condemn with more than words,” she added.
The EBRD says it is now focusing on deploying a €2 billion support program for Ukraine and countries in the region directly affected by the refugee crisis, announced in early March.
The bank has also pledged to participate in a reconstruction program for Ukraine as soon as conditions permit.
The institution warned last week that the war put the global economy at risk of facing the “biggest supply shock since at least the early 1970s”.
According to her, Ukraine’s economy is expected to contract by 20% this year due to the invasion of the country by Russia, which will in turn see its GDP plunge by 10% – assuming that a shutdown of hostilities will be decided within a few months, followed by a major effort to rebuild Ukraine.
According to this scenario, Ukraine’s economy should rebound by 23% next year, while Russia’s GDP, which is still expected to face sanctions, should just stabilize with zero growth.
The EBRD was founded in 1991 to help former Soviet bloc countries transition to a market economy, but it has since expanded its scope to include countries in the Middle East and North Africa.
© 2022 AFP
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