• GDP (current US$)

    Economic Developments

    GDP growth in the Europe and Central Asia region is shaping up to reach 2.2 percent in 2017, the strongest growth in six years. Almost all parts of the region show stronger growth than earlier expected, reflecting a strengthening of industrial production and exports in recent months.

    The region’s export growth continues to exceed growth of export volumes in the rest of the world. Central Europe and the Western Balkans continue to register solid GDP growth, while Russia and Belarus have come out of recession. Only Azerbaijan, the country that was hardest hit by the fall in oil prices and that responded with some delay, is expected to remain in recession this year.

    The improved growth outlook comes with a normalization of inflation, lower unemployment rates and in many countries moderate fiscal deficits. In the European Union, average inflation approaches 2 percent this year, after close to zero percent inflation a year ago.

    In Russia and Kazakhstan, inflation has significantly dropped from double-digit rates after the fall in oil prices. This confirms that the recent low inflation in oil-importing countries and high inflation in oil-exporting countries merely reflected one-time adjustments in relative import prices.

    In several countries, unemployment rates have fallen below pre-2008 levels, while labor participation rates are above pre-crisis levels. The average fiscal deficit this year is 1.6 percent of GDP, down from 5 percent in 2009.

    Despite this robust cyclical performance, however, daunting structural challenges have come to the surface. In many countries, the share of full-time permanent jobs in total employment has declined. The banking sector remains fragile in many countries also, and weaknesses have become more exposed in countries that directly or indirectly depend on commodity exports. Moreover, the financial sectors in the region are struggling to absorb new technologies and meet new demand for risky capital.

    Regional economic and political cohesion is being tested. After the European banking crises, the enthusiasm for deeper and broader integration has waned in the western part of the region. Meanwhile, the expected economic benefits of the Eurasian Economic Union have been somewhat diminished by the fall in oil prices.

    The eastern part of the region has still not fully adjusted to the change in relative prices and the dramatic fall in income triggered by the drop in oil prices. The unavoidable decline in private consumption has been steep.

    Last updated October 2017

  • The World Bank’s regional strategy for Europe and Central Asia seeks to eliminate poverty and boost shared prosperity by supporting clients in three overall areas of focus: Sustainable and Inclusive Growth, Human Capital, and Resilience:

    1. Sustainable and Inclusive Growth: Improving government efficiency and service delivery; creating markets, financial sector stability and a vibrant private sector; and energy and regional connectivity for growth.
    2. Human Capital: Building skills and job opportunities for the future; meeting the challenge of protecting vulnerable groups; and responding to aging and health challenges.
    3. Resilience: Prioritizing climate action and building resilience to natural disasters; rethinking the social contract; and facing the challenge of displaced persons.

    World Bank Assistance and Support

    The Bank approved $7.3 billion in lending to the region for 42 projects in fiscal year 2016, including $7.0 billion in IBRD loans and $233 million in IDA commitments. The Bank also signed 34 Reimbursable Advisory Services agreements with 9 countries for a total of $34.1 million. These agreements provide technical advice on such issues as the reform of education systems, public sector governance and institutional capacity building, and the planning and management of infrastructure investments.

  • Results

    We work with client countries to fight poverty and boost shared prosperity by helping them build more responsible institutions, increase private investment, improve service delivery, upgrade infrastructure, protect the environment, support human development, and empower marginalized groups.

    In order to deliver integrated solutions that help countries address their development challenges, we regularly look at where we are achieving results and making an impact. By measuring and monitoring those results, we can then improve the way we support our clients and achieve better development outcomes.

    Find out more about our results in Europe and Central Asia.

    Reimbursable Advisory Services (RAS)

    Middle-income countries interested in highly specific knowledge services that exceed what the Bank can finance from its own resources are increasingly accessing Bank technical expertise using Reimbursable Advisory Services (RAS).

    Find out more about Reimbursable Advisory Services.

    Analytical Work Highlights

    In addition to its financial products and RASs, the Bank produces important research about critical issues in the region. Through its analytical work, the World Bank aims to bring global knowledge and adapt it to the needs of ECA countries.

    Find out more about our publications and research on Europe and Central Asia.

  • European Union, European Commission, and other institutions

    The World Bank’s ECA region has a strategic partnership with the European Union (EU), and is working with the European Commission (EC) and European international financial institutions (IFIs) to improve the capacity of ECA’s EU-member clients to absorb EU funds.

    The Bank works closely together with EU institutions, European IFIs (European Investment Bank [EIB] and the European Bank for Reconstruction and Development [EBRD]), and the International Monetary Fund (IMF) as part of the second Vienna Initiative, which aims to improve banking systems and coordination among banking regulators in EU and non-EU countries.

    The World Bank Group, the EBRD, and the EIB Group came together in November 2012 for a new Joint International Financial Institution (IFI) Action Plan. One of the most important priorities under the Action Plan was to ensure continued financing for SMEs that are key drivers of innovation and job creation in the region.

    ECA works on Roma inclusion across the region in collaboration with various partners, including the European Commission, the Roma Education Fund, and a variety of national Roma agencies.

    The Bank is also working with the EurAsian Economic Community’s (EURASEC) Anti-Crisis Fund and with the Eurasian Development Bank to provide parallel financing for low-income ECA countries.


Additional Resources

Region Contacts

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