Published: May 14, 2010
EBRD president points to "prolonged and patchy" recovery in speech at annual meetings.
Emerging Europe will need to work even harder to sustain its "prolonged and patchy" recovery following events in Greece, EBRD president Thomas Mirow has said.
Speaking at the regional heads of governments meeting at the EBRD meetings held in Zagreb, Mirow said recent volatility in the financial markets of Western Europe has underscored the risks present during "the worst economic crisis our region has faced since the beginning of the transition period".
"We are now seeing a return to recovery, but we also know that any recovery will be prolonged and patchy," he added. "The main growth drivers of the pre-crisis period are expected to remain constrained in the coming years. Therefore new sources of growth have to be identified and cultivated. This is all the more urgent as the global competition for much scarcer investment is only set to intensify."
Mirow pointed to five areas that he says, with the right degree of politcal focus, could lay the foundations for sustainable growth: developing local finance markets; supporting smaller businesses; focusing on energy efficiency; boosting regional trade, particularly in South Eastern Europe; and continued EU integration.
"The crisis in Greece has the potential to set back recovery efforts, especially if Greek banks and their subsidiaries in the region were to be affected more deeply by the uncertainty in the markets, despite their fundamental health," Mirow concluded. "The decisive measures adopted by the European Union and the IMF are therefore a very welcome step towards calming the markets."