Athens, 28 May 1999 (RFE/RL) -- An important new regional institution will come into being Tuesday (June 1) when the Black Sea Trade and Development Bank begins operations. The bank, the financial arm of the 11-member Black Sea Organization of Economic Cooperation (BSEC), will be officially inaugurated three weeks later at its headquarters in Thessaloniki, Greece.
At a two-day meeting last week, the bank's board put the final touches on its operational procedures in three areas: project strategy, investment policies and risk assessment. The bank is due to become the main mechanism of the BSEC in working out, financing and implementing joint regional projects. It will also provide the necessary financial resources to member states.
BSEC members created the bank for two reasons. First, to grant credit and other financial arrangements both to governments and non-governmental organizations. Second, it will seek to mobilize funds, including aid from international financing institutions such as the European Bank for Reconstruction and Development (EBRD). This will allow the expansion of economic and commercial cooperation and the creation of specific projects of common interest to the Black Sea area.
The bank's capital, initially expected to be $150 million, will finance projects and programs funded jointly with other credit organizations like the EBRD. Its shareholders are the BSEC's 11 member states: Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Greece, Moldova, Romania, Russia, Turkey and Ukraine.
Greece, the only European Union member in the BSEC, is also currently the BSEC's president. Elli Frangakis, the Greek government's Economic Adviser, told our correspondent that Athens is playing an important role as the bridge between the EU and the BSEC.
The Black Sea group was founded seven years ago in Istanbul, where its secretariat is based. Since then, seven other countries -- Austria, Egypt, Israel, Italy, Poland, Slovakia and Tunisia -- have been granted observer status in the BSEC.
With a total population of 350 million people, the BSEC member states comprise a vast and geographically diverse territory endowed with rich natural resources.
The BSEC is governed by the Istanbul-based permanent council, which in turn is run by a board of directors headed by a rotating chair-country for six months. Among the chair's chief responsibilities is ensuring effective interaction among the member-states' business communities and the BSEC's various inter-governmental bodies. Its council is active in identifying private and public investment projects worthy of future BSEC support, working largely through a network of private business councils or governmental bodies in all the member states.
Among BSEC projects already underway are several in the telecommunications field. They include the establishment of a system of fiber-optic, land-cable and radio links that will connect Azerbaijan, Georgia and Turkey.
According to Frangakis, Greek officials closely cooperate with their Turkish counterparts in setting up programs that will benefit businesses in all member states. She also said that there are plans for two important inter-governmental seminars in coming months. The first will focus on the Black Sea's transportation sector, while the second will seek to find ways to improve business prospects and economic cooperation among member states. In addition, Frangakis said, Greece is organizing a two-day conference in October that will explore prospects for increased cooperation between the EU and the BSEC.