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Central Asia: EBRD Chief Says Regional Investments To Increase (Part 1)

  • Antoine Blua

Following the 11 September terror attacks and the U.S.-led war in Afghanistan, the five Central Asian states have assumed new strategic importance. That importance was underscored this week with an international economic summit in the Kazakh capital, Almaty, and high-profile trips to the region by World Bank President James Wolfensohn and Jean Lemierre, the president of the European Bank for Reconstruction and Development. The theme of the Eurasia Economic Summit was "Sustaining Growth in Uncertain Times." At the meeting, the international business community and top leaders discussed ways to improve the investment climate. Ahead of his visit to Central Asia, Lemierre took time out to talk to RFE/RL. In the first of a three-part interview, Lemierre says the EBRD this year will increase assistance to Central Asia, a region that he describes as having great potential.

Prague, 10 April 2002 (RFE/RL) -- Jean Lemierre, the president of the European Bank for Reconstruction and Development (EBRD), says his bank hopes to raise the amount of money it will invest in Central Asia this year to 400 million euros, up from 310 million euros last year.

He says this is because the investment climate in the region has improved considerably following the U.S.-led war on terrorism in Afghanistan and the ouster of the repressive Taliban regime.

"What is happening is an opportunity, [because] the situation in Afghanistan is stabilizing. This reduces the [political] pressures that the countries -- notably Uzbekistan -- had been feeling before. Secondly, the international community has shown an increasing interest toward Central Asia. It is clear that the 11 September events showed even more the strategic importance of the region. So our message to the investors and the Central Asian countries is that there is a real opportunity to develop Central Asia. The EBRD is committed to that. We are ready to help you. So we have increased the efforts."

Lemierre says the main way to improve the investment climate is to improve local governments and respect for the rule of law. This is a familiar statement. But he says the context created by the events of 11 September and the newfound awareness of the region's importance must push governments to make progress in these areas.

"Many reforms are to be made, of course. A common factor is to be clear about public and private governance, to fight against corruption, to improve the judiciary system, to respect the rules of law, in an absolutely clear and non-ambiguous manner. This is a fundamental issue to attract private investment."

Lemierre points to the region's oil and gas reserves as "considerable assets" that can bolster successful regional development. But he says banks like the EBRD should focus their assistance on projects outside of the oil and gas sectors to help the economies diversify.

"In Central Asia, we have a great objective, which is to finance the diversification of the economies, to make sure they are not based only on gas and oil resources. And to use these resources to develop industrial [sectors] and services sectors [for] the gas and oil industries -- essentially [in] Uzbekistan and Kazakhstan -- and also sectors of production for consumer goods for the local market."

Lemierre also stresses the bank's role in helping to improve the movement of goods across borders. He says this involves issues as wide-ranging as simplifying trade and customs formalities to improving transportation links.

"We have financed the modernization of the Uzbek railways. We have financed the modernization of the airport of Tashkent. We have invested in the airport infrastructure in Kazakhstan. For example, the modernization of the landing strips, lighting systems and communications on the landing strips at the airport of Atyrau, which is the big airport in the oil and gas area [in Kazakhstan]."

Lemierre notes his bank has also been active in supporting the financial infrastructure in the region. He says the EBRD has financed the development of banks in Uzbekistan and Kazakhstan.

The London-based EBRD was set up in 1991 to help the former communist countries of Eastern Europe and the Soviet Union build open markets and attract investment. Its main shareholders include the United States, Japan, and major Western European countries, as well as the states eligible to receive assistance.

(In Part 2, Lemierre discusses the situation in Turkmenistan, widely viewed as the most repressive and least open of the Central Asian states.)