The EBRD is providing new financing to support the reform of Romania’s urban transport sector and to improve living standards in Romanian towns. The Bank is supporting the modernisation of municipal infrastructure in Medias, a city in the central Romanian region of Transylvania, with a local currency loan of RON 33 million worth the equivalent of €7.85 million.
The RON 33 million credit will address urgent infrastructure needs in Medias, the second largest industrial city in Sibiu County, home to a number of large natural resource and industrial companies.
Extended in local currency, under the EBRD’s Urban Road Management and Rehabilitation Framework, the loan will help Medias municipality to mitigate foreign exchange risk. It will be used to finance investment in a comprehensive street rehabilitation programme and related water and wastewater network investments.
As part of the project, 47 road segments with a total length of over 12.5 km within Medias city centre will be modernised, as well as 5.7 km of streets in the nearby village of Ighisul Nou. In addition water supply, wastewater and storm water collection networks along these segments will be rehabilitated.
“This important project will bring considerable improvements to the quality of life of the citizens of Medias. Improved roads will reduce travel times and facilitate access to local businesses and tourist sites, while the modern water networks will bring important health benefits to the population,” said Jean-Patrick Marquet, director of the municipal and environmental infrastructure team at EBRD.
“Signing this contract with the EBRD is an essential step for our municipality and its citizens, as the Bank will provide the needed support in order to modernize the infrastructure of Mediaş, which will lead to important benefits for all its inhabitants. This loan is of a vital importance for our municipality, as it offers us the opportunity to implement an innovative project with the guidance and support of a very prestigious financing institution,” said Teodor Neamtu, mayor of the city of Medias.
The EBRD loan is supported by €265,000 in grant financing for technical due diligence as well as procurement and implementation support. The technical assistance is being provided by the Bank and the government of Portugal.
In 2010 the EBRD provided similar loans to the municipalities Sibiu and Sfantu Gheorghe. The Bank’s Urban Road Management and Rehabilitation Framework features performance-based road contracting that will improve the quality of road management and maintenance.
Since the beginning of its operations in Romania the EBRD has committed over €5 billion in various sectors of the country’s economy, mobilising additional investment of €8.4 billion.