Statssekretær Karin Yrvin

Norwegian intervention, EBRD annual meeting 2006

Mr Chairman/Madam Chair, Mr President, Distinguished Guests, Ladies and Gentlemen,

Let me start by congratulating the EBRD with impressive financial results in 2005. Norway would like to give honour to the EBRD management and staff for their excellent performance.

Norway has also noted that the EBRD has achieved, and in some areas exceeded, the objectives set in the second Capital Resources Review for the period 2001 to 2005. The assessment shows that the EBRD has been successful in its support of micro and small businesses and banks. Norway supports EBRD’s operational priorities, strategic approaches and guidelines as defined for the next five-year period.

Transition impact, sound banking and additionality should continue to be the core operating principles of the Bank.

EBRD’s own indicators show that the transition countries have made strong progress in structural and institutional reforms, although this varies across the region. Market improvements are made in the new EU member states. This experience demonstrates the powerful stimulus for reforms that follows the accession process, and that healthy democracies are essential for healthy economies. It is important for the transition process that the Bank within the next five years gradually phase out its operations in the EU-member countries and strengthen its presence in the countries that need its service most.

The EBRD should therefore maintain its focus on the countries that are in the early and medium stages of transition. In 2005 these countries counted for 58 per cent of the Bank’s business volume.

Here EBRD operations have profound influence on the development and economic growth in the short and medium term. As the Bank moves into more risky and challenging regions and environments, internal operational controls should be strengthened accordingly. This requires a strong capital base, prudent financial policies and profitability. The EBRD, in collaboration with other International Financial Institutions (IFIs) should continue to have a close policy dialogue with the authorities in these countries to promote openness, multiparty democracy and respect for human rights.

Although corruption has diminished, it is still quite high in some countries. Corruption and bribery distort the market functions, inhibit foreign investment and generally slow down the rate of development.

Fighting corruption in the EBRD Countries of Operations should be a major task for their political authorities and also for the EBRD.

The Bank’s operations and initiatives should be additional. Energy efficiency measures are particularly important. Such measures will contribute to sustain the environment. The consumers, both the industry and the households, should pay the real cost of energy and not a subsidised rate. This will be a strong incentive to focus on energy efficiency.

Russia is a main area for the Bank’s activities. Norway welcomes a continued solid presence in Russia, especially in the northernmost parts of the country. The initiatives under the Northern Dimension Environmental Partnership should continue with full strength.

Looking southwards in the Bank’s region of operations, Norway is committed to continue its support to the reform processes undertaken by the countries on the Western Balkans. Consequently, we welcome the EBRD proposal to establish a multi-donor fund for the Western Balkans and are prepared to make a contribution of 1 mill. Euro. The proposal includes many of the Norwegian priorities within fields like energy, environment, financing of small and medium sized enterprises, agribusiness, strengthening of public administration, fight against corruption and judicial reforms. As a participant in the EU through the EEA internal market, we also favour strengthened partnership in order to promote European integration.

Norway welcomes EBRD’s new Codes of Conduct for the Board of Directors and the Bank’s personnel. Such standards clearly state the values, duties and obligations of EBRD employees and promote transparency.

Finally, I would like to thank the United Kingdom and the City of London for hosting this Annual Meeting. I am also looking forward to the 2007 Annual Meeting in Kazan, Russia.

Thank you, Mr Chairman/Madam Chair