Bijeljina project cuts water pollution, reduces health hazards

The EBRD is lending €7 million to the water authorities in the town of Bijeljina, in the Republika Srpska, to help finance construction of a waste water network that will reduce water pollution and cut health hazards in the city in Bosnia-Herzegovina.

A further €4.5 million will be provided by the Bijeljina city authorities for the project that also aims to replace dilapidated asbestos cement water pipes.

The new network will address problems of pollution in the underground water system that is the only source of local drinking water for around 65,000 people.

The project also aims to increase the provision of water services to achieve supply 24 hours a day and 90 percent coverage in the city, up from 70 percent now, and 65 per cent coverage in rural areas.

The loan will also be used to modernise the water network, by replacing rundown water mains to reduce operating costs and increase efficiency. Also envisaged is the gradual upgrading of a water meter scheme, all of which will add to the positive environmental impact of the project.

Mico Micic, Mayor of Bijeljina, said that the construction of the sewerage system is the largest project in the Municipality of Bijeljina. This capital investment will solve crucial issues of environmental protection, including protection of long-term potable water resources. We are delighted to work on this project together with a reputable international financial institution such as the EBRD and I hope that this would pave the way for further cooperation in the future, Mr Micic said.

Signing the project, EBRD President Lemierre said this is the first EBRD project in the municipal infrastructure sector in Bosnia-Herzegovina and is the fruit of the close cooperation with the Bosnian government in securing financing for priority municipal infrastructure projects. The construction of the new Bijeljina waste water network has clear implications for health in the region. In the absence of this project the drinking water supply would be at risk from groundwater pollution and environmental conditions in the town of Bijeljina could continue to deteriorate, Mr Lemierre said.

The local water company Vodovod i Kanalizacija Bijeljina will be the direct beneficiary of the project and together with the Municipality of Bijeljina will be responsible for its implementation. Technical Cooperation to the amount of up to €600,000 will be provided to assist the company to implement the project and to improve its financial and operational performance. Vodovod i Kanalizacija Bijeljina is a joint stock company owned 65 percent by the government of Republika Srpska, 10 percent by a pension fund and five percent by the Restitution Fund of Republika Srpska. The remainder is held by individuals and privatisation investment funds. The project will ensure that the company develops as a sustainable business providing a high quality and sustainable service to the citizens of Bijeljina.

Vasilije Micic, General Manager of Vodovod i Kanalizacija Bijeljina, stated that this is the largest project in Bijeljina which would have a significant impact on the lives of its citizens. It is expected that the project would also help the company to expand its business volume by introducing new services to their customers and to improve its financial and operational performance.

The EBRD is the largest institutional investor in Bosnia-Herzegovina, having invested €594 million in 56 projects so far, 69 per cent of which were in the public sector and the rest in the private.