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EBRD lends to fifth municipality in Serbia
Waste-waster plant in Subotica to reach EU standards with €9 million loan
The EBRD is lending the city of Subotica, in north Serbia, €9 million to help
rehabilitate its waste-water treatment plant to meet European Union standards.
It is the Bank’s fifth loan to a municipality in Serbia, and part of its
strategy to reach more towns and cities country-wide.
The loan will be used by Subotica Vodovod i Kanalizacija, the water and
wastewater utility of the City, to upgrade the waste-water treatment plant to
improve the local environment. Specifically the upgrade will remove nitrogen
and phosphorous from the wastewaters, the main pollutants causing algae blooms
in Lake Palic. The lake is an important recreational beauty spot in Vojvodina
flanked by Art Nouveau style buildings from the early 1900s. In recent years
environmental degradation has made the lake unsuitable for bathing.
Municipalities in many towns and cities across Serbia are beginning to address
the backlog of investments and introduce institutional reforms needed to
provide improved municipal services and better environmental conditions. Henry
Russell, EBRD Deputy Director for the Municipal and Environmental
Infrastructure team, said the EBRD has worked in many cities across Serbia,
and this latest project reiterates our commitment to support local
government’s ambitions to develop such services to benefit their citizens.
This latest loan, which is backed by a state guarantee, builds on the EBRD’s
work in municipalities across Serbia. In 2001 the Bank lent the city of
Belgrade €60 million, without a state guarantee, to help develop municipal
services, and in mid 2002 lent a total of €16 million to the cities of
Kragujevac, Niš and Novi Sad.
The project is being supported by Serbia’s Municipal Infrastructure Agency,
set up by the Serbian government in 2003 with the help of a €10.5 million
grant from the European Agency for Reconstruction. MIA helps municipalities
prepare bankable projects, and the EBRD and EAR have signed agreements to
cooperate under its framework. Subotica is the first city to receive grant
investment under this framework.
By upgrading sewage works to meet EU standards, the city of Subotica will
fulfill a long-term plan for the municipality’s development, said Subotica’s
Mayor Geza Kucsera. The implementation of this plan will solve long-standing
problems connected to Lake Palic, and will create new opportunities for the
development of tourism, Mayor Kucsera said.
The EBRD is the largest investor in Serbia and Montenegro having invested €650
million in over 30 projects. Dragica Pilipovic, EBRD Director for Serbia and
Montenengro, said the Bank is putting more and more emphasis on investing in
this country and region, and to reiterate that point, will hold its 2005
Annual Meeting in Belgrade.
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