The European Bank for Reconstruction and Development welcomes the opportunity to participate in this World Summit on Sustainable 
Development and to exchange views with the wide range of participants who have come together to review the implementation of Agenda 21 which was adopted ten years ago.

Ten years ago, the EBRD had just marked its first year of operations as a bank to foster the transition to democracy and a market economy in the post-communist countries of Central and Eastern Europe. At the Summit in Rio in 1992, the EBRD was acutely aware of the lack of sustainability in the formersoviet region, but had barely begun to work on solutions.

The first failure of sustainability in these countries was the system itself. The new states from Central Europe to Central Asia all abandoned centrally planned systems and opted for democracy as the best hope for a sustainable future.

The EBRD was founded to nurture that transition. The first article of the founding charter recognised explicitly that sustainable prosperity would thrive only if democracy and market economies were built in tandem. The Bank's main role of investing in enterprises that will build the economies of these countries is subject to regular reviews of trends in democracy and market reform. Those reviews are made public in EBRD country strategies.

The EBRD works to engender sustainable development in its 27 countries of operation. The Bank has invested €20 billion, since 1991, which in turn has catalysed more than €60 billion of further financing. That has supported privatisation, helped to restructure companies and make them viable and provided loans or equity to start-up or existing businesses. That injection of capital has all the more impact when the receiving countries have strong macroeconomic conditions and have introduced reforms.
 

"...strong institutions, a thriving small business sector, and willingness to listen to local people..."

But this mobilisation of mainly private financing is not a recipe in itself for sustainability. Across the region, the EBRD has learned that financial investment can make the most positive contribution if there are some important added ingredients. Private financing can be especially effective if it is complemented by technical co-operation to prepare projects and improve the investment environment. And the Bank has learned that other important ingredients include strong institutions, a thriving small business sector, and willingness to listen to local people.

Institutions such as enforced rule of law provide the climate that attracts investors as well as making investment long-term and predictable. The experience of the EBRD region shows the damage that corruption can do, and the prosperity that can be spurred by transparency, clear legal systems, honest judicial process and engagement in, for example, the fight against money laundering.

The EBRD has learned the importance of nurturing small business to create jobs, to create businesses, to provide services to populations, and, just as important, to encourage an entrepreneurial spirit which in turn builds pressure for transparency.

The EBRD's investment work has improved over its lifetime as we have learned to listen. NGOs and local communities can offer a perspective that makes projects better, in terms of the viability of the investment itself as well as the people it affects.
 

"Respect for the communities and the environment affected by projects are part of the corporate governance of every EBRD transaction... "

Respect for the communities and the environment affected by projects are part of the corporate governance of every EBRD transaction, on a par with sound banking, high international standards to guarantee shareholder rights, transparency, accounting practices and integrity. The EBRD incorporates environmental standards into every investment it makes.

The soviet legacy of abuse of resources and the environment is the specific target of many of the Bank's investments. The EBRD promotes energy efficiency, for example, by working with governments to set true market values on water, electricity and other resources, while ensuring that, perhaps through targeted programmes, people have the capacity to pay higher tariffs. The EBRD finances energy service companies, or ESCOs, that make a business of helping enterprises to save energy. And many EBRD investments integrate energy efficiency components into new investments or improvements of existing projects.

A particularly nefarious legacy of an unsustainable past is nuclear insecurity. The EBRD manages a $1.5 billion Nuclear Safety Account to make safe or decommission ageing nuclear installations, including building safety structures around the Chernobyl nuclear plant in Ukraine.

The EBRD will continue to promote sustainability in the coming decade, working closely with other international financial institutions and governments. The Bank's role of supporting market economies must be complemented by others with different expertise, to ensure education, improve health and cushion the social effects of difficult economic choices that governments must make.

Another direction for the coming years will be the EBRD's even more concerted effort to encourage trade, transportation and other links among the countries of the EBRD region and with the rest of the world.

This Summit will mark another milestone in the collective concern with making our world sustainable. The achievement of the last ten years has been to keep sustainability on the global agenda as part of our planning. As the EBRD has matured through this decade, it has embraced, promoted and implemented the principles of sustainability and has helped foster progress by listening to the communities we serve.