WASHINGTON, July 3, 2014 – The World Bank Board of Executive Directors approved today an IBRD loan in the amount of US$30 million to Georgia for the Second Regional and Municipal Infrastructure Development Project.
The project development objective is to improve the efficiency and reliability of targeted municipal services and infrastructure. This will be achieved by investing in high-priority local infrastructure improvements, and by supporting local self-governments in enhancing their capacity and systems for service delivery.
“Addressing regional disparity, poverty and unemployment have been identified as key priorities for intervention by the Government of Georgia in its new Socioeconomic Development Strategy - 2020,” said Henry Kerali, World Bank Regional Director for the South Caucasus. “The financing of regional and municipal infrastructure development programs, decentralization, establishment of an effective local self-government system, and the provision of reliable municipal infrastructure and services to towns and villages are extremely important in this regard.”
The project consists of two components: i) infrastructure investment, and ii) institutional development. The first component will finance infrastructure investments for the rehabilitation and expansion of priority municipal services, and provision of public infrastructure to attract private sector investments in towns and villages. It will also finance technical preparation for sub-project investments, monitoring and evaluation and project management related activities. The second component, which is co-financed by an additional US$5.0 million grant from the Swiss Development Cooperation, will support local self-governments and the Municipal Development Fund in improving their institutional capacity and performance.
“The project’s primary beneficiaries are the residents of towns and villages, who currently experience poor quality services, thus contributing to improving regional equity,” said Ahmed Eiweida, World Bank Program Leader for Sustainable Development in the South Caucasus. “Beneficiaries are expected to receive improved quality and reliability of municipal services and infrastructure, with a positive impact on their living conditions and reducing their coping cost, especially women who are generally responsible for most of the home work related activities.”
The project is also expected to benefit small and micro enterprises and to attract new enterprises to beneficiary municipalities. As a result, the project would contribute to income generation and job creation, which lead to shared prosperity. As Georgia embarks on the second phase of decentralization, the Government would benefit from improved institutional capacity of local self-governments to deliver public services and maintain public assets.
World Bank commitments to Georgia since 1992 total approximately US$ 2.26 billion