In its operations in Southeast Europe, the European Bank for Reconstruction and Development (EBRD) will prioritize support for the countries' competitiveness, green transition, and resilience, in line with its strategic goals, the bank's president Odile Renaud-Basso said.

"Each country has to focus on its competitiveness, to try to improve the regulatory framework and attract investors, as well as to promote reforms that will facilitate investment," Renaud-Basso told SeeNews in an interview last week.

Reforms can be difficult to implement but they are crucial to remaining competitive, she stressed.

"One of the challenges is to continue to promote reform, as sometimes the political dynamics make it hard to find a consensus to change something. But that is very important to remain competitive in a global world where big progress is being made in several areas."

That is why, according to Renaud-Basso, it is very important for the EU member states in the region to take full benefit of the European Commission's Recovery and Resilience Facility (RRF). "It is a huge opportunity to step up investment, and it goes hand in hand with reforms."

As an example of areas that need improvement she pointed to the need to transform state-owned enterprises (SOEs) to make them more effective and to develop infrastructure that would improve connectivity.

The risk of a trade war and slow growth in the EU - and in Germany in particular, which has a number of suppliers in Southeast Europe - are creating hurdles to growth in the region, the EBRD president noted.

In its latest forecast issued in February, the EBRD projects that in the countries of operation in its Southeastern EU region - Bulgaria, Greece, and Romania - economic growth slowed to an estimated 1.5% in 2024 but is forecast to rebound to 2.1% in 2025.

To help the region develop its growth potential, the EBRD plans to maintain a high level of investment in it. In 2024, the bank's investments in Bulgaria more than doubled to Euro 272 million (Dollar 295 million), while in Romania it surged to Euro 707 million.

"We see a lot of opportunities. We will focus on the areas where we bring the most impact both for the people, the environment, and the business climate," the EBRD president said.

Projects for key energy infrastructure, renewable energy and batteries stand to receive funding, alongside support for startups through the Star Venture programme which the bank will launch in April, and credit lines for SMEs in partnership with local private lenders.

The bank will also continue to promote the development of a regional capital market with a common infrastructure that would give impetus to the relatively small and illiquid markets in most countries.

The EBRD's operations in Southeast Europe are aligned with the bank's strategic priorities for the next five years which it is due to reveal in May. "At this juncture, the role of the private sector in economic growth, the countries’ development, and creating jobs is key and will remain at the core of what we do. Building the private sector, supporting competitiveness but also financing the green transition and social inclusion, are key objectives for the EBRD," Renaud-Basso said.