Regional and Local Roads Connectivity



Project number:


Business sector:


Notice type:


Environmental category:


Approval date:

11 Dec 2019



PSD disclosed:

13 Jun 2018

Translated version of this PSD: Albanian

Project Description

Provision of a sovereign loan to the Republic of Albania for the benefit of the Albanian Development Fund (ADF) to finance the rehabilitation of key regional and local roads in Albania. The Project is part of a larger investment programme for the rehabilitation of Albania's regional and local road network which is parallel-financed by a World Bank loan.

Project Objectives

  • Support Albania's economic development and contribute to its internal integration by by developing its regional and local road network. The Project will improve the quality of road service and road safety and reduce vehicle operating costs and travel time. Through improvement of regional transport links, the Project will provide more reliable access to economic centres and will generate road user benefits as well as productivity gains across the agricultural and tourism sectors.
  • The Project, through inclusion of road safety audit recommendations and climate change resilience measures in the road design, will support the strengthening of road safety management and climate change adaptation, which are of particular importance in Albania due to the challenging geographical location of most of the road network.

Transition Impact


  • The Project will support Albania's internal integration by improving connectivity between its regions that are currently inadequately integrated. The Project will improve road infrastructure and services between important tourist destinations along Albania’s coast facilitating the flow of goods and people and reducing transportation costs.
  • The Project will promote inclusive procurement practices to provide on-the-job training opportunities for young people during the construction phase.

Client Information


The Borrower is the Republic of Albania represented by the Ministry of Finance and Economy. The Client is ADF which is responsible for the development of the local and regional road network.

EBRD Finance Summary

USD 50,000,000.00

A sovereign loan of up to USD 50 million. The Bank’s loan will be divided into two tranches:

  • Tranche 1 in the amount of up to USD 40 million to finance the rehabilitation and upgrade of a road section between Vlore and Orikum, approximately 10.6 km in length (“Section 1”) ; and a road section between Shengjin and Baks-Rjoll, approximately 13 km in length (“Section 2”);
  • Tranche 2 in the amount of up to USD 10 million to finance the upgrade and paving of a road section between Zgosht and Ura e Cerenecit, approximately 47.1 km in length (“Section 3”).

Tranche 2 which will be committed/made available subject to satisfactory completion by the Bank of all necessary due diligence including environmental and social due diligence on the relevant road section. Board’s approval will be sought prior to commitment of Tranche 2.

Total Project Cost

USD 61,580,000.00

The total Project cost is estimated at approximately USD 61.6 million.

Environmental and Social Summary

Categorised B ESP 2014.  The Project is expected to improve road quality, safety, access and address climate resilience measures as roads in Albania are frequently subject to impacts from flooding and landslides. The environmental and social (E&S) impacts associated with the Project are expected to be readily identified and managed via the implementation of the environmental and social action plan (ESAP).   The road sections to be rehabilitated or constructed under the investment programme were selected based on strategic plans and a multi criteria analysis basis focused on priorities for tourism and agriculture.

The upgrade and paving of Section 3 to be financed by the Project will undergo a separate E&S due diligence and will be subject to separate Board approval on a no-objection basis.

E&S due diligence (ESDD) by the Environment and Sustainability Department, included a review of the investment plans of Section 1 and Section 2, the ADF management systems, supporting documentation and a site visit.  ESDD has found that the ADF has an established E&S Management Framework (ESMF) which requires an E&S assessment, E&S Management Plan (ESMP), stakeholder consultation and information disclosure to be provided for each project. Also a Resettlement Policy Framework and Resettlement Action Plan (RAP) are developed if appropriate.  Whilst the overarching Frameworks have been structured over time to meet most of the IFI requirements, ESDD found that some areas needed further refinement in order to ensure that projects are structured to fully comply with the EBRDs Performance Requirements (PRs), notably in relation labour, contractor management, traffic management, resettlement and stakeholder engagement.

Section 1 and Section 2 are at an early stage of development so will be required to meet national regulatory requirements and obtain the necessary permits. The project preparation in line with the updated ESMF is expected to meet EBRD PRs however project documentation will be subject to independent review to confirm this.

The Project is located within an area of high biodiversity value as it will traverse the Buna River Protected Landscape (IUCN Category 5; National Park), Ramsar, Important Bird Area, Important Plant Area and candidate Emerald Network Site for 10.82 km. The Project Development Area (PDA, defined as the project footprint, working width and associated working sites) has been identified as providing habitat for a number of endemic, rare and threatened species at the national and global scales. Taking a precautionary approach, a rapid critical habitat and priority biodiversity feature screening confirmed the presence of key sensitivities for the Project that are of high biodiversity value, namely critical habitat-qualifying species and habitats namely the coastal lagoon and the Buna River, connecting waterbodies and wetland habitats of the Lake Shkoda and River Buna Ramsar complex and the Buna River Protected Landscape. A Biodiversity Impact Assessment was undertaken in August 2019, for the  project  to supplement the Environmental Impact Assessment (EIA) and a Habitats Regulations Assessment was also undertaken for the Project in August 2019 to determine whether the project might have any likely significant effect on Lake Shkodra and River Buna Ramsar and candidate Emerald site. Although likely significant effects were identified during the screening stage under eight assessment criteria, after mitigation it was determined that none of these impacts will affect the integrity of the reserve.  Diligent application of best practice measures for minimising and managing the risk of potential Project-related impacts arising from habitat loss and degradation, noise and vibration, accidental vehicle collisions with fauna, artificial light spill, air and water pollutants, barriers to movement, changes in hydrology and water quality is expected to minimise the risks to both priority habitats, species and the Buna River Protected Landscape. No direct residual impacts to critical habitat-qualifying species, the coastal lagoon and the Buna River, connecting waterbodies and wetland habitats of the Lake Shkoda and River Buna Ramsar complex were identified following mitigation. The project will however result in the permanent loss of approximately 13 ha of terrestrial habitat from within the Project footprint of which, approximately 11 ha of habitat will be permanently cleared from within the Buna River Protected Landscape (a critical habitat-qualifying feature). A Biodiversity offsetting strategy will be designed and implanted ensure not let loss / a net gain for biodiversity. A key priority for the Project is the continued support for the conservation of the River Buna Protected Landscape and the Lake Shkoda and River Buna Ramsar Complex hence a Sustainable and Eco-Tourism Project will be implemented to develop a sustainability, eco-tourism programme to mitigate the indirect impacts biodiversity associated with project-related facilitated access and tourist in-migration. A Biodiversity Management Plan has been prepared by independent consultants for the project and details the Project’s biodiversity management initiatives, commitments and obligations to safeguard and promote the viability of priority species and habitats associated with the Project in line with PR6 requirements. This includes the development and implementation of a  Reinstatement and Landscaping Plan to restore habitats ‘like for like’ and the implementation of a Biodiversity Monitoring and Evaluation Programme to inform adaptive management.

Whilst the project is mainly rehabilitation of existing roads, it will also involve the construction of two new alignments of 1.7km and 2.19km respectively to enable the development of pedestrian and recreational areas along the sea coast. Potential relevant impacts of these and other alignments on land and livelihoods will be addressed through development and implementation of appropriate RAPs/LRPs for the Project. Physical resettlement is expected to be limited to two houses on one of the two road alignments but this will be confirmed during the detailed design.

As some sections of the project will be undertaken in busy tourist areas, particular attention on traffic management and road safety will be required during the works including occupational road risk management arrangements. Also a road safety audit will be undertaken for each road section.A

DF have appointed a Citizen Engagement specialist to co-ordinate stakeholder engagement, social media and the grievance mechanism and ensure Project information disclosure and consultations are undertaken in line with EBRD PR10.  In addition a Sustainable and Eco Tourism Programme including local stakeholder engagement activities will be undertaken.

An ESAP has been prepared and includes requirements such as: update of the Project ESMF and Project Resettlement and Policy Framework to fully align with the Banks PRs; implement improvements to contractor management requirements and  scope of ESMPs  broadened to align with EBRD PRs; implementation of the Biodiversity Management Plan; development and implementation of traffic and road safety plans covering both occupation and community road risks; implementation of the grievance mechanism; chance finds procedures; and the stakeholder engagement plan implementation.

The Client will submit annual E&S Reports on the project’s compliance with the PRs and implementation of the ESAP.

Technical Cooperation

The following Technical Co-operation assignments are envisaged as part of the Project:

1. Development of a sustainable and eco-tourism programme;Preparation of the detailed design of the road sections to be financed by the Project;
2. Works supervision;
3. Project implementation support.

Company Contact Information

Ermir Omari
+355 4 2235 597
Rr. Sami Frasheri, Nr. 10, Tirana, Albania

Business opportunities

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