The World Bank is reducing its involvement in Central and Eastern Europe, following the European Union entry of eight countries from the region, writes Frankfurter Allgemeine Zeitung (Germany). Earlier this year, Slovenia made the jump from a debtor country to a donor nation. In Hungary, the World Bank closed its office last year, since the country did not need World Bank funds any longer. Meanwhile, in Slovakia, where the development process has progressed more slowly when compared to Slovenia and Hungary, World Bank funds were still very welcome during the past three years. Altogether, $415 million went to the small Danube republic between 2001 and 2003. There, the World Bank contributed considerably to the reform of the banking sector, the pension and health systems, as well as to national finance management, the daily writes.

But following the European Union’s enlargement, the Bank is now also slowing down its work in Slovakia. Under the recently signed „partnership strategy,“ the Bank will provide only a modest loan program of $17 million between 2005 and 2007. The development organization is however not abandoning Slovakia, the German daily notes. The emphasis of future co-operation will depend on technical aid and the ‚analytical component of economic development.‘ „Our goal still is to support the country in its efforts to raise the standard of living for all citizens, “ the World Bank says. The development organization looks at the new partnership program with Slovakia as a sort of „pilot project.“ Similar programs that will pay special attention to technical aid as the means to increase competitiveness, cushion social reforms, and reduce poverty, are not excluded from the other new European Union members, the German daily notes.

The new partnership strategy with Slovakia focuses on three central topics. First, there is the improvement of fiscal management. What is important here is the decentralization of finances, the cost-efficiency of the administration as well as the continuation of reforms in the key sectors such as health, education, and social services. Secondly, the strategy focuses on promoting competitiveness. By creating an effective private sector, promoting rural development and education reform as well as furthering EU legal standards, the country is to be put in a position that will enable it to advance rapidly and lastingly to EU levels. Finally, the partnership strategy attaches particular importance to reducing poverty and improving the social integration of all population groups. Despite high growth rates during the last years, there is a lot of poverty in the country, due mainly to high unemployment and problems with minority groups. Also, the development of small and medium sized enterprises, which could create jobs, is progressing only slowly. The partnership strategy will thus focus on improving local services and developing infrastructures at the district level in order to promote the creation of jobs, says the news report.

In a related piece, The Wall Street Journal Europe writes that Jean Lemierre, who starts his second four-year term as president of the European Bank for Reconstruction and Development, faces a tough group of new clients. When eight countries from Central and Eastern Europe joined the EU, there was a sense of both satisfaction and apprehension at the London-based EBRD. Now the EBRD must turn its focus to regions that have been slower to develop market economies and promote democratic institutions: the Balkans, Central Asia, Russia and the Caucasus. It won’t be easy, the daily writes. In Central and Eastern Europe, the EBRD was able to ride in the slipstream created by the EU enlargement process. The eight prospective members had to enact the kind of economic reforms that meshed with the EBRD’s promotion of the private sector, and had to stick to democratic processes. For many of the countries the EBRD will now be focusing on, EU membership is a distant dream. The EU doesn’t even have a common framework for managing its relations with Georgia, Moldova, Armenia, Ukraine and other countries in the region.