The European development financial architecture plays an important global role, but is also complex, composed of a multiplicity of actors at EU and national levels. There are overlaps, gaps and inefficiencies, sectoral and geographical, especially in terms of presence and experience in Africa, of the main European multilateral finance institutions, the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD).
Strong and effective coordination is necessary to turn this situation into a strength rather than a liability. And while the system collectively has a comprehensive range of development financial instruments available, there is a not a single EU strategy to define how these should be used in synergy to tackle the top-priority global challenges. The present fragmentation of the system, especially between the EIB and the EBRD, is detrimental to the fulfilment of the EU's priority goals and the achievement of the desired development impact. This argues for the consolidation and streamlining of development finance and climate activities outside the EU into a single entity, a European Climate and Sustainable Development Bank, in order to avoid overlaps, and strengthen the EU's presence, role and long-term capacity to deliver on EU development priorities.
This independant report by the High-Level Group of Wise Persons on the European financial architecture for development considers three options for such consolidation. They all imply important institutional changes and require significant financial resources. The first is to turn the EBRD into such an institution by transferring the extra-EU activities of the EIB to the EBRD. The second is to create a new mixed-ownership bank with the EIB, the EBRD, Member States and the European Commission as shareholders. The third is to task the EIB with creating a subsidiary for its extra-EU activities and participating in it as a minority shareholder alongside Member States, the European Commission, and national development banks (NDBs).