Serbia will soon become a member of the International Investment Bank. It specializes in medium-term and long-term financing of projects aimed at supporting the economic development of countries. We signed a Memorandum of Understanding with this financial institution on November 4, 2021. Its current members are the Russian Federation, Cuba, Bulgaria, Hungary, the Czech Republic, Slovakia, Mongolia, Romania and Vietnam.
By signing the Memorandum of Understanding with the International Investment Bank, Serbia has undertaken the obligation to pay the first installment in the share capital of this institution. It is about ten million euros, which we will have to pay no later than a month after the Assembly confirms the Agreement on the Establishment of the International Investment Bank.
Proposing this law, the Government explains that this bank is one of the best rated financial institutions in its regions of business, with an average rating of A by international rating agencies.
– Securities of the International Investment Bank are subject to trading on the stock exchanges in Bratislava, Bucharest, Budapest, Moscow, Prague and Vienna – it is stated in the explanation of the law. – At the same time, the International Investment Bank offers direct financing and loans in partnership with other financial institutions, as well as through partner banks.
Zoran Grubisic, a professor at the Belgrade Banking Academy, expects membership in one such institution to support capital movements.
– Such an institution is certainly good, because it represents an association, like the World Trade Organization, which, for example, has a clause of the most favored nation – said Grubišić. – If we compare it with this organization, which expects benefits in the international economy and foreign trade arrangements, similar benefits could be expected when it comes to international capital movements, in the form of investments. I assume that such an international organization will support the movement of capital, and protect it from non-commercial risks.
As he said, when investing somewhere, business risk is taken, but if it is an investment outside the borders, protection from some risks is needed, such as emergencies, political upheavals, laws, expropriations. That is why membership in such an organization is such an agreement is significant as protection against such non-business risks, Novosti reports.
