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EIB to lend €90m to co-finance sustainable energy project in Belarus

Economy 22.10.2019 | 13:08

MINSK, 22 October (BelTA) – Belarus intends to sign a credit agreement with the European Investment Bank (EIB) by the end of the year for the sake of financing a project designed to expand the use of sustainable energy together with the World Bank, representatives of the Belarusian Economy Ministry told BelTA after a Belarusian delegation visited Washington, USA to participate in annual meetings of the boards of governors of the International Monetary Fund (IMF) and the World Bank Group (WBG).

During the visit Belarusian Economy Minister Dmitry Krutoi met with EIB Vice President Vazil Hudak. The sides discussed the current level of cooperation, mentioned the unprecedentedly fast growth of the EIB portfolio in Belarus (the bank's investment portfolio has already reached €335 million since the framework agreement was signed in 2017).

According to the source, another credit agreement to the tune of €90 million is supposed to be signed by the end of the year so that the European Investment Bank and the World Bank could jointly finance a project designed to expand sustainable energy usage in the country. The project provides for expanding the use of renewable local fuels for heating purposes instead of imported natural gas. It also provides for replacing ineffective gas-fired boilers with boilers that burn wood biomass in six oblasts of the country. It also provides for thermal modernization of apartment buildings with poor heat insulation in Grodno Oblast and Mogilev Oblast.

In order to build up on previous agreements on expanding the EIB's financial support for small and medium businesses via Belarusian partner banks the sides discussed the possibility of opening new credit lines to Belarusbank and Belagroprombank to the tune of about €105 million this year. Thus the European Investment Bank's portfolio in Belarus may exceed €0.5 billion by the end of the year.

Talking about long-term prospects, the sides also discussed the possibility of the European Investment Bank financing projects in the area of car charging infrastructure, the modernization of the healthcare system, and the enhancement of the transit potential. The possibility of organizing the first visit of the EIB president to Belarus in 2020 was discussed.

The Economy Ministry reminded that credit agreements on two major investment projects have been signed with the European Investment Bank this year. One of them provides for reconstructing and modernizing the M7/E28 motorway Minsk-Oshmyany-the Lithuanian border (the border checkpoint Kamenny Log). The project costs €110 million. Among other things the money will be used to increase the bearing capacity of the road surface to match the standard European axle load. The existing traffic interchanges will be reconstructed and traffic safety installations will be emplaced. Apart from that, the automobile border checkpoint Kamenny Log will be upgraded to increase the designed throughput capacity from 2,060 vehicles per day to 6,000 vehicles per day.

Estimated to cost €66 million, the second project will be financed together with the World Bank and provides for modernizing water supply and wastewater disposal facilities, building regional municipal waste disposal sites, and fostering the reformation of the utilities industry. Its implementation will allow increasing the accessibility, quality, effectiveness, and sustainability of water supply services, wastewater disposal services in addition to supporting the modernization and transformation of the provision of such services.

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