SOFIA (Reuters) - The European Bank for Reconstruction and Development (EBRD) is ready to lend more to Western Balkan nations and help them implement reforms so they can attract more investment as they seek to join the European Union, EBRD President said on Wednesday.
The EBRD lends about one billion euros (£875.2 million) per year in Albania, Bosnia and Herzegovina, Macedonia, Kosovo, Montenegro and Serbia and is the largest multilateral investor in the region, which still bears the scars of the ethnic wars fought in the 1990s.
“Western Balkans is already the region that gets the highest per capita investment of all EBRD regions,” EBRD President Suma Chakrabarti told Reuters in Sofia, where he will be attending an EU-Western Balkans summit on Friday.
“We really aim to do even more. If there is more reform, then the EBRD will be able to invest more than a billion a year,” he said.
Set up in 1991 to invest in ex-communist economies of eastern Europe, the EBRD has expanded its mandate in the last decade and now operates in more than 35 countries.
The development bank is considering expanding its annual lending by almost a third to 12.5 billion euros from its current average of about 9.5 billion. Chakrabarti said it will see by the end of the year how much of the extra 3 billion euros a year can go into the Western Balkans.
The bank is looking to support projects that will improve transport and energy infrastructure as well as projects that will help their energy distributors or stock exchanges work together better.
“Things that broke down after Yugoslavia broke up but we are trying to help the economic union of the region and that will help them in the European Union membership in a long term,” Chakrabarti said.
In February, it announced 700 million euros for road infrastructure in Bosnia and Herzegovina and it is also looking to extend up to 450 million euros a year to Serbia for transport, green energy and agriculture projects.
The EBRD has told Western Balkan countries it could take them up to 200 years to catch up with the living standards of the European Union states they want to join if they did not act to improve their low productivity and speed up reforms.
“Our job has to be how do we attract more foreign investment to the Western Balkans, and that really means having better reforms, better policies, better governance, less corruption,” Chakrabarti said.
Reporting by Tsvetelia Tsolova; Editing by Hugh Lawson