The World Bank and Global Environment Facility to Help Improve the Quality of its Coastal Waters

The World Bank’s Board of Executive Directors today approved a EUR60 million loan and a US6.4 million Global Environment Facility Grant to the Republic of Croatia to help combat pollution along the country’s coast.

 

This second phase of the Coastal Cities Pollution Control Program will build on the activities of the first phase, which aimed at safeguarding the quality of coastal waters and the environment, both of strategic importance to Croatia’s tourism industry, the livelihoods of local communities and marine life.  Phase two will seek to improve the efficiency and sustainability of wastewater services in 30 coastal cities where only 49 percent of the population has adequate wastewater collection systems and only 16 percent of the wastewater is treated.  The overall program will help Croatia meet European Union environmental standards needed for successful EU accession. 

 

The  project will also help reduce the level of nutrients and other pollutants entering Croatia’s coastal waters from households and industries, and will test innovative wastewater treatment solutions in selected municipalities.

 

“Croatia is renowned worldwide for its beautiful coasts with coastal tourism generating considerable income for the country and many people making their living directly or indirectly from tourism related activities.” said Orsalia Kalantzopoulos, World Bank Country Director for Croatia.  “It is therefore of vital importance to safeguard this important resource by reducing the amount of pollutants that enter seawater and to ensure that future generations can also benefit from Croatia’s rich natural heritage.”

 

The first component of the project will undertake investments to construct or upgrade wastewater collection, treatment and disposal systems in 30 municipalities. Four municipalities regarded as environmental “hot spots” will receive grant funds for enhanced nutrient reduction wastewater treatment facilities.   The second component will focus on the implementation of the Water Management Strategy and assisting Croatia’s water sector to meet EU standards.  The third component will help measure the impact of the program’s activities on the quality of seawater.

 

The overall cost of the project is Euro 120 million, which is supported by an IBRD Loan for Euro 60 million at six month LIBOR plus fixed spread, with a maturity of 15 years, including a 5-year grace period.  The Global Environment Facility Grant of US$ 6.4 million is co-financing the project, which is under the World Bank GEF Investment Fund for the Mediterranean Sea.

Since joining the World Bank in 1993, Croatia has received support from the global development institution in the form of financial and technical assistance, policy advice and analytical services. To date, the Bank has offered support for 39 operations with a total value of US$2.3 billion, and it has approved 51 grants with a total value of US$63 million.

About the GEF

 

           The GEF unites 178 countries in partnership with international institutions, non-governmental organizations (NGOs), and the private sector to address global environmental issues while supporting national sustainable development initiatives. Today the GEF is the largest funder of projects to improve the global environment. An independent financial organization, the GEF provides grants for projects related to biodiversity, climate change, international waters, land degradation, the ozone layer, and persistent organic pollutants. Since 1991, GEF has achieved a strong track record with developing countries and countries with economies in transition, providing $8.3 billion in grants and leveraging $33.7 billion in co-financing for over 2,200 projects in over 165 countries.

 

 Through its Small Grants Program (SGP), GEF has also made more than 7,000 small grants, up to $50,000 each, directly to nongovernmental organizations

 and community organizations. 

 

The World Bank Group is one of GEF’s implementing agencies and supports countries in preparing GEF co-financed projects and supervises their implementation.  It plays the primary role in ensuring the development and management of investment projects. The Bank draws upon its investment experience in eligible countries to promote investment opportunities and to mobilize private sector, bilateral, multilateral, and other government and non-government sector resources that are consistent with GEF objectives and national sustainable development strategies.  Since 1991, the World Bank Group has committed $1.52 billion in GEF resources and $2.25 billion in Bank group co-financing for GEF projects in 80 countries. In addition to GEF and Bank resources, it has mobilized additional co-financing of $5.48 billion from other donors.