Under its framework to support water and wastewater modernisation in the Kyrgyz Republic, the European Bank for Reconstruction and Development (EBRD) is providing financing for projects in four more Kyrgyz cities, with a total population of over 141,000 people. The European Union (EU) and the European Investment Bank (EIB) will jointly co-finance these projects, building on existing successful cooperation on EBRD-led projects.
The financing agreements were signed at the EBRD’s Annual Meeting in Nicosia, Cyprus, by the Minister of Economy of the Kyrgyz Republic, Arzybek Kozhoshev, and EBRD First Vice President, Phil Bennett.
The city of Balykchy will receive a loan of up to US$ 1.21 million from the EBRD, an equal amount from the EIB and an investment grant of US$ 3.5 million from the EU’s Investment Facility from Central Asia (IFCA).
The city of Maili-Suu will receive loans of up to US$ 1.6 million each from the EBRD and the EIB, and an investment grant of US$ 4.6 million from the EU’s IFCA.
The city of Toktogul will receive loans of up to US$ 1.21 million each from the EBRD and the EIB, and an investment grant for US$ 3.5 million from the EU’s IFCA.
Lastly, the city of Uzgen will receive loans of up to US$ 2.75 million each from the EBRD and EIB, and an investment grant from the EU’s IFCA of US$ 5.5 million.
All the loans will be provided to the Kyrgyz Republic for on-lending to municipal water companies in these cities. The funding will allow the cities to undertake critical water supply improvements, introduce modern metering systems and upgrade operations and maintenance equipment.
The municipal water companies will also undergo internal restructuring to strengthen their accounting, environmental and social practices. The investment will prepare the cities for future large-scale extension of services, including wastewater services which are currently available to only one-third of their populations.
The financing will be accompanied by technical cooperation programmes of up to US$ 1.1 million for each water company financed by the government of Japan and the EU’s IFCA programme.
Phil Bennett said at the signing: “Upgrades of old water systems in Central Asia are where we achieve perhaps the most immediate effect on people’s lives. The EBRD’s approach is to work with partners and to provide blended finance – namely, a combination of loans, grants and technical assistance – with the aim of involving private sector finance at some point as well. We believe this is an optimal model to achieve development goals not only in the Kyrgyz Republic but in the whole region.”
Minister Arzybek Kozhoshev said: “Providing the population with safe drinking water and sanitation is one of the priorities for the government of the Kyrgyz Republic. The water and wastewater sectors in the republic are affected by lack of funds needed to ensure reliable exploitation and maintenance of the systems. Therefore, EBRD projects aimed at modernising municipal infrastructure, which already cover 18 Kyrgyz cities, are very important and necessary.”
Ambassador Cesare De Montis, Head of the Delegation of the European Union to the Kyrgyz Republic, also commented on the new projects.
"Providing safe water and sanitation to Kyrgyz families is one of the top priorities for the European Union’s work in Central Asia,” he said. “In cooperation with the EBRD, we have so far supported modernisation projects by water companies in six cities. The Kyrgyz Republic has received more than €30 million from the IFCA funding, which makes the country the largest beneficiary of the IFCA funding in Central Asia."
Including these four projects, the EBRD together with the EIB has invested over US$ 59 million (€54 million equivalent) into water and wastewater modernisation in 18 cities in the Kyrgyz Republic.
In total, the EBRD has invested about US$ 85 million (€77 million) in the Kyrgyz Republic.