The Europe and Central Asia region has undergone a dramatic process of transformation since 1989; with its countries transitioning from traditionally centrally planned economies towards a market-based system. This evolution has been driven by private sector development activities– with economic resources moving from the state to the private sector and transforming the role of the state from the sole economic actor to facilitator, rule-maker, enforcer, and mediator. Although all but one of the countries in the region* faced a seemingly similar challenge in the wake of the fall of the Former Soviet Union, the differences in resource positions and political philosophies have induced highly differentiated reform programs over the past fifteen years. Given the substantially disparate transition paths, and the differences in pace in which these programs were carried out, a highly diverse region has emerged. Over this period, ECA has changed significantly in terms of shape and structure. The previously closed region continues to open up its borders and reaffirm its commitment to integrate further, both internally and with the rest of the world. As a result, client countries exhibit a cornucopia of challenges, with the underlying framework for developing healthy private sectors which can act as the engine for the growth process as a single common thread within the region.  The World Bank’s interventions in private sector activities seek to address the region’s changing dynamics through providing an approach which tailors World Bank assistance to the growing diversity within the region. In the past, the proportion of PSD and PSD-related interventions within ECA grew to as high as seventy percent of all projects within the region. In the face of increased competitive pressures from across the globe, as well as the drive towards fully integrating the region with the EU and other key strategic partners, the role of the private sector remains as critical as ever. The evolution of the region, however, has been supported through the continued development of the World Bank’s core competencies to reflect the changing needs of its clients. As such, the strategic trends in the regions reflect a shift in focus from providing support in the development of programs to assist in the initiation of privatization programs within the region to the following key themes:
Innovation, productivity and growth Building an enabling business environment SME and MSME development and access to finance Bankruptcy and exit Non-lending value-adding services New products and approaches in the post privatization environment
* With Turkey being the sole exception |
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