Name: Mattia Romani, Managing Director for Economics, Policy and Governance, European Bank for Reconstruction and Development

Title: How EBRD can Support the Belt and Road Initiative

Abstract:

The European Bank for Reconstruction and Development (EBRD) is an agile and flexible multilateral development bank mandated to foster the transition toward open market-oriented economies and to promote private and entrepreneurial initiative. The EBRD is a natural partner for the Belt and Road Initiative (BRI) as we share the strategic priority of integrating our countries of operations into regional and global markets through sound infrastructure investments. Additionally the EBRD is already active in almost all of the BRI countries north and west of China from Mongolia to Eastern Europe and the southern and eastern Mediterranean region, providing a wealth of opportunities for collaborations along the new Silk Road routes.

The EBRD plans to be an active contributor to the BRI, from financing institutional and policy support, to project preparation and capacity building, working with both the public and private sectors. The EBRD has already signed MoUs with the Asian Infrastructure Investment Bank (AIIB) and the Silk Road Fund and signed the first joint project with AIIB in the Tajik road sector.

Much emphasis is placed on the infrastructure financing gap in the emerging markets, estimated to be between $1 trillion and $1.5 trillion a year, with attention placed on sourcing financing for the much-needed infrastructure projects along the routes of the BRI and globally. According to the EBRD's 2015 Transition Report, the EBRD region alone requires around $75 billion of additional investment per year in the infrastructure sector and the Asian Development Bank estimates the annual infrastructure financing needs in Asia to be on average $750 billion.

However, at the EBRD, we place equal value on bridging the legal, regulatory, policy and capacity "gap" that prevents the development of sustainable and proper infrastructure projects. Comprehensive legal and regulatory frameworks along with tariff policies are paramount to the success of infrastructure projects in our countries of operations, both in terms of ensuring the sustainability and longevity of a project and in attracting financing.

The focus of this paper is on how the EBRD, as the International Financial Institution with most overlap with the BRI principles and geographically, can support the BRI both through the traditional means of direct financing and catalysing additional financing and through policy advice and project preparation.

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