The Draft Law “On the Ratification of the Loan Agreement, between the Republic of Albania and the International Bank for Reconstruction and Development, for the National Program of Modernization of the Water Supply and Sewerage Sector in Albania” was Approved by the Albanian Parliament

The Draft Law “On the Ratification of the Loan Agreement, between the Republic of Albania and the International Bank for Reconstruction and Development, for the National Program of Modernization of the Water Supply and Sewerage Sector in Albania” was Approved by the Albanian Parliament

The National Program for the Modernization of the Water Supply and Sewerage Sector in Albania” aims to support the water infrastructure at the national level with the objective of improving the operational and financial performance of water supply and sewerage companies, as well as increasing access for safe management of water supply throughout Albania.

During March 2023, representatives of the National Agency of Water Supply, Sewerage and Waste Infrastructure (AKUM) and the Ministry of Infrastructure and Energy (MIE) presented the loan agreement to the relevant committees of the Parliament of Albania and its approval was recently obtained by the Parliament.

The program is co-financed by the Albanian Government and the International Bank for Reconstruction and Development (IBRD). The total value of the loan is 75 million USD for a period of 60 months, while the program will also be supported by a grant from the Swiss government in the amount of up to 6.3 million USD.

This program aims to contribute directly to the fulfillment of the Government’s objectives to achieve the aspirations of the National Sectoral Strategy 2019-2030 towards an organized water and wastewater sector that provides quality services, promoting health and the economy.

In the framework of the restructuring of the water supply and sewerage sector at the national level, the program provides support and financing for the priorities identified, and included in the government program, such as:

• improving energy efficiency;
• increasing access to water supply in rural and urban areas;
• financial support for water utility companies to mitigate the consequences of the Covid-19 crisis and support for the general reform in the water sector.

The International Bank for Reconstruction and Development for the first time in the water infrastructure sector will finance the program with a new foreign instrument called Program for Results (P4R), which will enable a focus on the intended results (unlike traditional financing with no clear incentives for improving performance).

The disbursement of foreign funds will be related to the fulfillment of some criteria\indicators by the beneficiaries (LGUs\PUCs) which in this financing scheme are called Indicators Related to Disbursement, or Results Related to Disbursement.

The benefits (outputs) of this program are as follows::

• Safe, reliable, sufficient and quality provision of water supply services for the entire population of Albania;
• Increasing the performance level of customer service;
• Increasing the operational and financial performance of water and sewerage enterprises, and managerial skills;
• Increase of jobs and income in rural areas;
• Increase in tourism;
• Increasing climate resilience (floods, droughts, landslides, etc.);
• Promotion of the EU integration process.