The European Bank for Reconstruction and Development

The European Bank for Reconstruction and Development (EBRD) was established in 1990 and began operations in 1991. The EBRD was created during the disintegration of the Soviet Union and its mission was directly related to the USSR’s demise. The agreement establishing the EBRD states that the purpose shall be “to foster the transition towards open market-oriented economies and to promote private and entrepreneurial initiative in the Central and Eastern European countries” and work toward three important principles: multiparty democracy, pluralism, and market economics. While the primary goal of the EBRD is to help Central and Eastern European countries move toward market-oriented economies after decades of state-run economies, the agreement makes it clear that the EBRD is also committed to promoting the rule of law, respect for human rights, and the strengthening of democratic institutions. The EBRD, which some have described as “stand[ing] out” because of the specific political goals in its charter, has been criticized at times for holding its annual meetings in dictator-run countries and not applying pressure for democratic change. Since its creation in 1990, the EBRD’s objectives have always been different from the objectives pursued by other international financial institutions. The EBRD aims to foster the transition of its countries of operations to open-market economies. The EBRD is owned by 61 countries and two intergovernmental institutions. It has an excellent credit rating of AAA from Standard & Poor, Aaa from Moody’s and AAA from Fitch (figure 10.1).