LONDON (Reuters) – The European Bank for Reconstruction and Development (EBRD) said on Thursday it expected to ramp up investments in Ukraine and surrounding countries after donors indicated pledges of almost 1 billion euros ($1.04 billion).

The lender had said on Tuesday that it would spend 1 billion euros in Ukraine in 2022.

Speaking at the conclusion of its annual meeting in Marrakech, Morocco, EBRD President Odile Renaud-Basso said that during a board of governors’ meeting on Wednesday, donors had earmarked more funds in response to the war.

Russia’s invasion of Ukraine on Feb. 24 is expected to trigger a sharp economic contraction in both countries and weigh heavily on the regional and global economy.

“The war in Ukraine and how to respond was at the heart of our discussion,” Renaud-Basso said during a news conference.

“We will deploy this money alongside our own funds to support infrastructures and companies in Ukraine and affected countries.”

European Union Commissioner for Trade Valdis Dombrovskis estimated the cost of war damage to Ukraine at between 500 billion and 600 billion euros.

During the meeting, the EBRD’s governors also decided “in principle” to start operations in the sub-Saharan Africa region, though Renaud-Basso declined to discuss which countries could be first in line for investments or how much the lender was planning to deploy.

“This doesn’t mean we will be starting activities there yet – further steps will be needed,” she added. “For now, our focus will be on the Ukraine crisis and we will come back subject to further decisions taken by our board of governors with the next steps on sub-Saharan Africa and Iraq no later than this time next year.”

Countries would need to become EBRD members before receiving any of the bank’s financing.

The lender started debating an expansion into sub-Saharan Africa around four years ago under former president Suma Chakrabarti, but progress has been slow. Renaud-Basso was appointed the bank’s president in November 2020.

The EBRD covers some 40 economies stretching from Mongolia to Slovenia and Tunisia.

Renaud-Basso said that “energy and food security” would be driving the bank’s agenda as the repercussions of Russia’s invasion of Ukraine will be long-lasting and is putting pressure on all members.

She declined to say whether the bank would suspend Russia’s membership, after the EBRD decided to close its offices in Moscow and Minsk in late March.

“It is a political decision from shareholders, not a question for the EBRD,” she added.

(Reporting by Jorgelina do Rosario in London; Editing by Hugh Lawson)

FILE PHOTO: A glow is seen over the city’s skyline during a shelling, following Russia’s invasion of Ukraine, in Kyiv, Ukraine February 28, 2022. REUTERS/Gleb Garanich