Is the EBRD’s model of promoting democracy through investment having any effect?

PACE’s Political Affairs Committee has queried whether the work since 1991 of the European Bank for Reconstruction and Development (EBRD) to develop market economies in transition countries has helped to promote democracy, which is also one of the stated aims of the bank.

Approving a report by Hendrik Daems (Belgium, ALDE), the committee said: “It is not yet clear whether, and, if yes, to what extent, the Bank’s activities to develop market economy in its countries of operations has had an impact on promoting democracy.”

The parliamentarians urged the bank to carry out and publish further research showing the impact of its investments on the progress of democracy in the countries where it operates, and to be more transparent about performance-related information.

They noted that of the eight countries expected to “graduate” by 2010, only one did so, and urged the bank to clarify what precise criteria it applied during this process. “Such information would allow a better assessment of the impact of investments on the progress of democracy,” they added.

PACE has provided parliamentary oversight of the bank’s activities since 1992, holding regular debates on its work.