Friday, October 24, 2014
 
Follow sptimesonline on Facebook Follow sptimesonline on Twitter Follow sptimesonline on RSS Download APP
MOST READ



PARTNER NEWS



BLOGS



OPINION



WHERE TO GO?

19th Century Portraits

History of St. Petersburg Museum: Rumyantsev Mansion

 

Перевести на русский Перевести на русский Print this article Print this article

As Crisis Deepens, EBRD Freezes New Investment in Russia

Published: July 24, 2014 (Issue # 1821)



  • The EBRD's decision shows that the doors have only shut tighter since the downing of Malaysia Airlines Flight MH17 last week.
    Photo: Andy Lane / EBRD

The European Bank of Reconstruction and Development, or EBRD, on Wednesday froze financing of new projects in Russia amid escalating international condemnation of Russia's alleged role in the downing of a passenger jet in eastern Ukraine.

"A majority of the board of directors of the EBRD, including all European Union member states and several non-EU shareholders, have given clear guidance to the EBRD management that, for the time being, they will be unable to approve new investment projects in the Russian Federation," the organization said in a statement Wednesday.

The London-based development bank will continue work on its 305 active projects in Russia, where its operating portfolio amounts to 8.4 billion euros ($11 billion).

While the loss of new EBRD investments is far from trivial — about 19 percent of its investments, or nearly $1 billion, went to Russia in the first half of this year — the decision suggests that worse may be on the horizon, analysts said.

"It is a harbinger of what is going to happen, which is the increasing capital isolation of Russia," said Fredrik Erixon, director of the European Center for International Political Economy.

International lenders have shut their doors on Russian banks and companies in recent months for fear of further sanctions from the West over Russia's policy in Ukraine, leaving Russian banks unable to access additional financing and meet the needs of the national economy.

"Given the high capital need and the high investment need in the Russian economy, [capital isolation] is going to have a very, very strong effect on national GDP," Erixon said.

The EBRD's decision shows that the doors have only shut tighter since the downing of Malaysia Airlines Flight MH17 last week, which the U.S. and others have blamed on Russia's alleged funneling of weapons to the pro-Russia separatist rebels in Ukraine's east.

The deaths of the 298 people on board, many of them EU citizens, has put the EU under pressure from the U.S. and member states such as Britain to ratchet up sanctions to so-called "stage three" sector-wide measures.

Pages: [1] [2 ] [3]






 


ALL ABOUT TOWN

Friday, Oct. 24


SPIBA’s ongoing “Breakfast with the Director” series continues today, featuring Tomas Hajek, Managing Director of the Northwest Division at Danone Russia. Hajek will be discussing collaborations between businesses from different cultures. The meeting is at 9 a.m. at the Domina Prestige St. Petersburg hotel and all who wish to attend must confirm their participation by Oct. 23.


Get your gong on at “Sounds of the Universe,” a concert at the city planetarium this evening incorporating six different gongs to create relaxing songs that will transport you upwards into the stratosphere. Tickets are 700 rubles ($17).



Saturday, Oct. 25


AVA Expo, the eighth edition of the event revolving around all things pop culture, returns to Lenexpo this weekend. Geeks, nerds, dweebs and dorks will have their chance to talk science fiction and explore a variety of international pop culture. Tickets for the event can be purchased on their website at avaexpo.ru.



Sunday, Oct. 26


Zenit St. Petersburg returns home for the first time in nearly a month as they host Mordovia Saransk in a Russian Premier League game. Currently at the top of the league thanks to their undefeated start to the season, the northern club hopes to extend the gap between them and second-place CSKA Moscow and win the title for the first time in three years. Tickets are available at the stadium box office or on the club’s website.



Monday, Oct. 27


Today marks the end of the art exhibit “Neophobia” at the Erarta Museum. Artists Alexey Semichov and Andrei Kuzmin took a neo-modernist approach to represent the array of fears that are ever-present throughout our lives. Tickets are 200 rubles ($4.90).



Tuesday, Oct. 28


The Domina Prestige St. Petersburg hotel plays host to SPIBA’s Marketing and Communications Committee’s round table discussion on “Government Relations Practices in Russia” this morning. The discussion starts at 9:30 a.m. and participation must be confirmed by Oct. 24.



Times Talk