EBRD Seeks Comment on Draft of New Disclosure Policy

22 March 2006

At the London-based European Bank for Reconstruction and Development, the board recently released a proposal to modify its disclosure policies, with comments due April 14. The EBRD included in its announcement a number of new provisions.

First, two new categories of information would be disclosed: General Institutional Information and Accountability and Governance. Second, the EBRD would publish the minutes of the Board of Directors Meetings. Third, public participation in the development of Country Strategies would be encouraged by posting draft strategies on the Bank’s website with an invitation to comment, a reform the EBRD resisted in the last round of disclosure policy review.

A February letter from the Global Transparency Initiative (GTI) suggested a number of additional reforms. Specific recommendations from the GTI focused on the disclosure of documents produced throughout the project cycle and those associated with the development of country strategies. These recommendations are based on the GTI’s draft IFI Transparency Charter, a series of provisions which sets out the standards and norms that should govern IFI disclosure policies and the principles that should guide their practices.

EIB Releases Stealth Project List; Nears Final Decisions on Disclosure Policy

The EIB has released a list of the private sector projects not announced before approval by the board in 2005, responding to a freedominfo.org request.

The March 16 disclosure marks the first time the organization has listed its stealth projects, although all approved projects eventually find their way into an annual report list. The EIB allows some private projects, about 15 percent of them, to stay off the EIB’s public “pipeline” notification system while under consideration. The EIB policy is intended to accommodate commercial sensitivities of potential project sponsors.

Despite the recent release, the controversial policy has not been eliminated from the draft disclosure policy the EIB is expected to complete in April and has been a contentious point during the consultation process. A final draft was posted March 7.

EIB Project List

During 2005, 21 projects were published on the project list after Board approval. Of these, 14 were signed during the year and also recorded under signed loans on the Bank’s website:

  • Construction of waste water treatment plant at Dora, northern Beirut, Lebanon
  • Construction of a new cement plant in centre of country by Obajana Cement plc, Nigeria
  • Commerzbank Global Loan, Germany
  • Bank of Ireland Global Loan, Ireland
  • Acquisition of five Ro-Pax vessels operating mainly on routes between Finland, Sweden and Germany by Finnlines plc , Finland
  • Construction of hydro powerplant on Gilgel Gibe river, FDR Ethiopia
  • HVB Bank Global Loan, Romania
  • Upgrade of transmission grid network, Belgium
  • Tatra Banka Global Loan, Slovakia
  • Construction of flood barrier in St Petersburg, Russia
  • Replacement of heat and power plant in Riga, Latvia
  • Financing of small and medium-scale ventures, Caribbean Dev. Bank, Regional
  • Financing of small and medium-scale ventures, Trinidad and Tobago
  • SGYB Global Loan, Serbia and Montenegro

7 others were included in the project list after board approval, but not signed in 2005:

  • Construction, installation and operation of a flat-float-glass plant located in Osterweddingen, Germany
  • Financing fleet expansion of Ryanair, Ireland
  • CLICO Global Loan, Trinidad and Tobago
  • Renovation of the Ministry of Finance, Netherlands
  • Financing a toll-bridge over the Tarn river, France
  • ABS Global Loan, Poland
  • Africa Fund to support African companies in infrastructure and other investments by CEO Emerging Markets Partnership, Regional Africa

The EIB letter said “a clear distinction needs to be made between projects approved by the Board of Directors, and projects that are then committed/signed by the EIB. The letter continued: “It is only the latter that are recorded in the Bank’s relevant annual report. Not all projects approved by the Board are signed in the same year, some indeed may be signed 18 months or even (exceptionally) longer after approval. There are also occasions when approved projects are never signed.”

EIB Data Shows Stable Rate of Secret Projects in 2005

Despite the bank’s announced intention to cut back on this practice, EIB figures indicate otherwise. In a previous response, the EIB provided freedominfo.org with new data on the numbers of private sector projects not announced until after board action in 2005.

The Bank has defended the practice as being necessitated by the business confidentiality concerns of the applicants. The EIB contends some applicants deserve this confidentiality, and that opacity benefits the Bank, a contention that pro-transparency activists reject.

The data provided by the EIB indicates that 338 private sector projects were approved in 2005, and that information about 85 percent of these (289) was made available before board approval. On average, the advance notice came 88 days before Board approval. EIB policy stipulates no minimum time frame for prior disclosure.

A further 21 were published on the project list after Board approval, bringing the total published in 2005 to 92 percent. Of the 28 not announced on the project list, the Bank noted, “some of these was due to administrative oversights.” Of the 28 projects not published on the Project List (pipeline), 12 were signed during the year, and as such recorded under signed loans on the Bank’s website. The Bank added, “We hope that during 2006 there will be a reduction in such oversights.”

On June 29 Remy Jacob, deputy secretary general of the EIB, defended the EIB’s announcement practices. Jacob said that 64 percent of applications were disclosed in 2003 and 87 percent in 2004. He predicted a 95 present level of disclosure for 2005, attributing the upswing to questioning of applicants by the EIB staff about the necessity of confidentiality. “Now we ask the promoter to justify why,” he said, “and he has to show it is a commercial or financial risk.”

By Toby McIntosh

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Filed under: IFTI Watch


In this column, Washington, D.C.-based journalist Toby J. McIntosh reports on the latest developments in information disclosure in International Financial and Trade Institutions (IFTI).
Contact: freeinfo@gwu.edu or
1-(703) 276-7748