From Transition Bank to EU Neighborhood Policy Bank : EBRB’s Commitment Change in Egypt

Motivated by an ongoing IPE debate on the repurposing of regional development banks as a means of global finance or state capitalism, we explain how and why the European Bank for Restructuring and Development (EBRD), a neoliberal development bank created to promote transition to market economy and democracy, operates today in Egypt, an authoritarian regime with characteristics of state capitalism. We explain EBRD’s changing practice by pointing to the European development finance field and especially its operational logic in Egypt since 2015 to which EBRD mimetically adapts. EBRD’s move to Egypt is motivated by its desire to break out of its legitimacy crisis in Eastern Europe and Central Asia. As Egyptian politics changes, EBRD moves closer to the European field and embraces its logic of financing public investments to fight the climate crisis, mitigate security threats, and counter geoeconomic rivals. By adapting the logic of the field, however, EBRD gives up its democratic commitment, even if it retains a liberal practice. Our findings point to a possibility of a nexus between global finance and authoritarian state capitalism. EBRD’s involvement in this is a warning to the global development banking community to uphold the democratic oversight mechanism while embracing new goals