The London-based European Bank for Reconstruction and Development (EBRD) has finally decided not to resume operations in Russia next year.
The matter had been discussed internally during the summer, as the profitability of the EBRD’s Russian projects was found to be higher than the average, while the state of mind of some of the bank’s shareholders towards Russia had changed positively.
A decision was expected from the bank’s shareholders in December or January.
However, the bank’s negative decision was revealed yesterday by Russian Deputy Finance Minister Sergey Storchak: “No, they do not plan [resuming investment in Russia]. EBRD has adopted a financial plan that does not include our projects,” he told reporters, according to the TASS news agency.
When created in the early 1990s to support Eastern European countries in their transition toward market economy, the EBRD considered help to Russia as being “its single biggest challenge.”
In total, the EBRD invested €24 billion in Russia, spread over 800 projects, from 1991 to 2014. Its last investments in the IT and telecom sectors went to online package tour reseller Travalata, IT service company Maykor, Internet broadband provider Trivon, and telecom tower operator Russian Towers, among others.
The bank froze new investment projects in Russia in late July 2014, amid the international tensions triggered by the Ukrainian crisis.
All EBRD projects must be approved by the Board representing the 64 countries and two international institutions (the EU and the EIB), which own the EBRD.
