EBRD and Switzerland support water supply improvements in Kyrgyzstan

By Anton Usov

€11.2 million financing package to Karakol municipal water company

Karakol is the country’s main ski resort and a major tourist attraction in the Kyrgyz Republic

  • €5.5 million EBRD loan to support improvement of water supply system in Karakol
  • Over 80,000 inhabitants will have access to safe drinking water by 2021
  • Project to benefit from Switzerland’s grant funding of € 5.7 million

Residents and visitors to Karakol, a municipality with a population of over 70,000 people and a major tourist destination in the Kyrgyz Republic, will benefit from regular uninterrupted access to fresh drinking water, secured after the implementation of a municipal investment project supported by the EBRD and the Swiss Government through the State Secretariat for Economic Affairs (SECO).

A 15-year sovereign loan of up to €5.5 million by the EBRD and a grant of up to €5.7 million from the Swiss Government to Karakol Vodokanal, the city’s municipal water utility, will help address ageing water supply infrastructure, most of which was put in place some 50 years ago.

The investment will finance a number of critical water supply system improvements, including network rehabilitation, operational and maintenance equipment, metering, a new storage tank and a pump station renovation.

The intervention will also support the management of Karakol Vodokanal to improve corporate management capacities and to enhance citizen participation and inclusion in water sector governance, and will further provide engineering advisory services.

Once the project is implemented, the number of new Karakol Vodokanal customers will increase by 14,000 by 2021. In addition, the EBRD will help optimise the water and wastewater tariff system and update Karakol Vodokanal’s customer database.

The rehabilitation of the existing water supply infrastructure will also have significant operational benefits for the city’s utilities: the project is expected to result in annual energy savings of 1,675 MWh and water losses will fall from currently 14 million m3 per year to 1.9 million m3 by 2023.

The prudent use of groundwater resources is understood as increasingly important in a country which is among the most vulnerable to climate change in Central Asia.

All contracts for the purchase of network pipes, meters, operational and maintenance equipment under the project will be procured by open tender in compliance with the EBRD's Procurement Policies and Rules. This will provide equal opportunities for eligible bidders and contribute to the transparency and cost efficiency of the refurbishment programme.

To date, the EBRD has invested over €660 million in the economy of the Kyrgyz Republic, with a majority of investments supporting private entrepreneurship. Over €140 million has been invested in 18 water projects across the country.