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Clean water for central Croatian region
€10 million EBRD loan for wastewater treatment plant in Karlovac
The EBRD is supporting the construction of a wastewater treatment plant in
Karlovac with a €10 million loan. The central Croatian city currently has
almost no wastewater treatment facilities at all. Approximately 80,000 people
live in the region and discharge their effluents untreated into the Korana,
Mreznica and Kupa rivers, which eventually flow into the Danube.
The project will also be applying for grant funding from European Union ISPA
funds. Croatia has become eligible for such funding for environmental projects
as part of the EU accession process. Compliance with EU environmental
requirements will be one of the key challenges for the country. The ISPA
finance, when approved, will provide the project with the funding necessary
for additional improvements to the water and sewer system, including new sewer
collectors and lines, as well as replacing aging pipes, the majority of which
were laid during the 1930s.
The EBRD loan will be provided to Karlovac Water and Sewer Company, which
supplies regional households and commercial costumers in the region -
including metal industry companies, a major brewery and a large dairy – with
water. The company will enter into a service agreement with the city which
will introduce market principles and gradually eliminate cross-subsidies.
The project will have significant environmental benefits for the Karlovac
region but also on a broader scale, said Charlotte Ruhe, Head of EBRD’s office
in Zagreb. The EBRD has a strong track record in municipal and utility
financing and is able to provide long term loans for more than ten years to
local service providers with a municipal guarantee.
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