EBRD, Silk Road Fund to co-invest in OBOR projects

The move comes shortly after the European lender and the Beijing-based AIIB announced their inaugural joint deal.

The European Bank for Reconstruction and Development and China’s Silk Road Fund have agreed to explore potential co-investments in their common regions of operations, according to a Memorandum of Understanding signed last week in Beijing.

“Our regions have a funding gap of about $400 billion a year for necessary infrastructure investments. A joint effort by all stakeholders is needed to bridge that gap and we see working with partners like the Silk Road Fund as the most efficient way forward,” said Phil Bennett, EBRD first vice president, in a statement. 

“The EBRD’s areas of operation cover many strategic nodes along the Belt and Road Initiative, and are important investment destinations for Chinese corporates,” added Wang Yanzhi, board member and president of the Chinese development fund. 

The multilateral bank operates in 36 countries in Central and Eastern Europe, the Caucasus, Central Asia and the Southern and Eastern Mediterranean. 

Last month, the EBRD formed a similar partnership with the Beijing-led Asian Infrastructure Investment Bank. The two institutions have since announced their first joint project, a road linking Dushanbe, Tajikistan with the Uzbek border, the financing of which has been approved by EBRD’s board. They are now considering other joint infrastructure projects in Central Asia. 

The Silk Road Fund also intends to make an equity investment in Germany's Energy from Waste, working jointly with relevant parties, including Hong Kong-listed energy and waste treatment company Beijing Enterprises Holdings, to expand the solid waste treatment business in China, Germany and other parts of Europe, the fund said last week. 

The fund is teaming up with China Gezhouba Group and China Environmental Energy Holdings, two Chinese renewables developers, to jointly explore renewable investment opportunities in Belgrade as part of bilateral agreements between China and Serbia.