€50 million sovereign loan to rehabilitate road network
The EBRD is supporting the modernisation and improvement of transport infrastructure in Albania with a €50 million sovereign loan to finance the rehabilitation of regional and local roads in the country.
Over half of Albania’s population is concentrated in rural areas, the majority of whom are engaged in the agricultural sector. The poor condition of rural roads in the country is hindering the development of the private sector in small towns and villages, limiting the competitiveness of agribusiness companies.
The proceeds of the EBRD’s loan will be used to finance the refurbishment of up to 500 km of roads in rural areas of Albania. The European Investment Bank (EIB) will provide a loan for the same amount to co-finance the project.
The project is also supported by €33 million in grant financing from the European Commission under the Instrument for Pre-Accession Assistance (IPA) 2010/2011 programme, and an additional €4 million technical assistance grant from the Western Balkans Investment Framework (WBIF)*.
The investment is part of a wider national programme to rehabilitate 1,500 km of regional and local roads, financed on a parallel by the World Bank, OPEC Fund, the Council of Europe Bank and potentially other financiers.
“This project is of paramount importance for Albania’s further economic development. Improved transport infrastructure in rural areas will facilitate the access of communities to essential services and economic markets, raising the competitiveness of local companies and improving living standards in small towns and villages”, said Sue Barrett, Director of the EBRD Transport Team.
“We are very pleased to continue our cooperation with the EBRD for the modernisation of the transport infrastructure in Albania. The financing mobilised under the EBRD’s leadership will support important road rehabilitation works, which will bring the communities living in rural areas closer to markets and services”, said Ridvan Bode, Albania’s Minister of Finance.
To date the EBRD has invested €120 million for the modernisation of transport infrastructure in Albania. Overall the Bank has committed to date around €550 million in various sectors of the country’s economy, mobilising additional investments of close to €1 billion.
*WBIF is a joint grant facility and a joint lending facility launched by the European Commission, EIB, EBRD and the Council of Europe Development Bank with the aim to finance priority projects in the Western Balkans.