“The Fund is being financed out of the Bank’s reserves and will allow the Bank to start operations as a prelude to full-scale investment in the new region after an extension of the EBRD’s geographic remit has been ratified,” it added in a statement.

After years concentrating mainly on investment partnerships with private-sector firms across the former Soviet bloc it shifts its attention to another region where people are again demanding a more stable economic future. is planning to invest specifically in Egypt, Morocco, Tunisia and Jordan. It has opened preliminary offices in all four of these countries, appointed a managing director for the region and hired additional staff with regional experience.

The Bank will focus on the development of the private sector in the new region, fostering growth of small and medium-sized enterprises, helping to improve municipal services, developing stable financial sectors and improving energy supplies via SEI activities.

The Bank expects to be able to eventually invest up to €2.5 billion a year in the new region, while not detracting from investments in its existing countries of operations, where funding totalled €9.1 billion in 2011.

The EBRD though stressed that it would continue to support growth in eastern Europe, which was facing a slowdown in growth because of the eurozone debt crisis.

Its Arab investment announcement came on the final day of the EBRD’s annual meeting in London and after the bank on Friday unexpectedly selected top British civil servant Suma Chakrabarti to run as its president for four years from July, according to AFP.