18.03.2025, 13:42
The State Duma has ratified the change in the structure of the Eurasian Fund for Stabilization and Development
Source: OREANDA-NEWS
OREANDA-NEWS The State Duma has ratified the protocol on amendments to the treaty on the establishment of the Eurasian Fund for Stabilization and Development (EFSD). The document transforms the fund into an independent international financial organization that will be able to provide financing in national currencies.
The government submitted Bill No. 836672-8 to the Chamber in early February, and the protocol regulating the transformation was signed on June 26, 2024 in Astana. The Protocol provides for a change in the management structure of the EFSD, which will allow it to operate independently from the Eurasian Development Bank (EDB). This will create conditions for new states to join and expand the geography of the fund's operations.
The Eurasian Fund for Stabilization and Development was established on June 9, 2009 by an agreement of six countries: Russia, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan and Armenia. The management of its funds was carried out by the EDB, it is recalled in the explanatory note. Earlier it was reported that the EDB funds were blocked on NSD's Euroclear account, but on August 17, 2023, the bank obtained a license to unfreeze the funds.
"The new management structure of the fund, which does not provide for a fund manager represented by the EDB, will allow new states to join the fund, which will contribute to a more balanced management structure of the fund (decision-making), expand the geography of operations of the EFSD and the possibilities for providing them with financing," the explanatory note says.
The materials note that the transformation of the fund is caused by the institutional limitations of its work and the request of the EAEU member states to create a permanent institute for development and support. It also highlights the need to finance projects in the national currencies of the participating countries, which is relevant in the changed geopolitical situation. Currently, projects should be financed in US dollars or euros.
As part of the reform, it is planned to assign the fund the status of an international financial organization and grant it immunities, privileges and benefits in the territories of the participating States. In addition, the EFSR and its operations are exempt from taxes and fees.
The EFSD issues loans on repayment and fee-based terms, as well as grants for social projects.
The government submitted Bill No. 836672-8 to the Chamber in early February, and the protocol regulating the transformation was signed on June 26, 2024 in Astana. The Protocol provides for a change in the management structure of the EFSD, which will allow it to operate independently from the Eurasian Development Bank (EDB). This will create conditions for new states to join and expand the geography of the fund's operations.
The Eurasian Fund for Stabilization and Development was established on June 9, 2009 by an agreement of six countries: Russia, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan and Armenia. The management of its funds was carried out by the EDB, it is recalled in the explanatory note. Earlier it was reported that the EDB funds were blocked on NSD's Euroclear account, but on August 17, 2023, the bank obtained a license to unfreeze the funds.
"The new management structure of the fund, which does not provide for a fund manager represented by the EDB, will allow new states to join the fund, which will contribute to a more balanced management structure of the fund (decision-making), expand the geography of operations of the EFSD and the possibilities for providing them with financing," the explanatory note says.
The materials note that the transformation of the fund is caused by the institutional limitations of its work and the request of the EAEU member states to create a permanent institute for development and support. It also highlights the need to finance projects in the national currencies of the participating countries, which is relevant in the changed geopolitical situation. Currently, projects should be financed in US dollars or euros.
As part of the reform, it is planned to assign the fund the status of an international financial organization and grant it immunities, privileges and benefits in the territories of the participating States. In addition, the EFSR and its operations are exempt from taxes and fees.
The EFSD issues loans on repayment and fee-based terms, as well as grants for social projects.
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