According to an EBRD press release, the bank unveiled an emergency "Solidarity Package" worth 1 billion euros, which will help companies in all regions of the world, to cope with the consequences of pandemics coronavirus. The proposal was approved today by shareholders of the Bank, which invests in development support, especially for the private sector, in 38 emerging economies. This is the initial response to the crisis, and the Bank is prepared to do more if necessary.
Under the emergency program, the EBRD will establish a "sustainability framework" to provide financing to existing EBRD clients with strong business fundamentals that are experiencing temporary credit difficulties.
Planned measures will include expanding trade finance and providing short-term financing for up to two years through financial institutions, especially in support of small and medium-sized enterprises.
The bank will seek to provide short-term working capital for up to two years for other corporations and energy developers, as well as balance sheet restructuring and short-term liquidity support for municipal, energy and infrastructure customers.
This EBRD emergency package comes as the Bank is already generally pledging strong support to its existing countries of operations, and in 2019 the EBRD emergency package reached a record investment level of €10.1 billion.
EBRD economists expect economic output to be affected in all regions of its operations, with growth slowing, especially in Central Asia, but also in Eastern Europe and the Caucasus, Russia, and Southeast Europe.
Countries that are highly integrated into global supply chains and in particular have a direct dependence on China and Europe are likely to be most affected by this virus. The tourism industry is likely to be affected in many EBRD countries.
The recent downturn in oil prices will also have an impact on oil-producing countries in the EBRD regions, and the flow of remittances from workers back to their home countries is also expected to slow down.