OREANDA-NEWS. December 14, 2012. The EBRD is expanding its successful programme of upgrading water supply systems in Tajikistan by further investing in efforts to bring safe water to the northern cities of Istravshan, Panzhakent, Shakhriston and Zafarobod as well as Isaev and Yovon, in the south-west Khatlon Province.

The EBRD is extending two loans worth a total of USD 12 million to Khojagii Manziliyu-Kommunali (KMK), the central governmental agency responsible for water supply and wastewater services, for on-lending to its subsidiaries in the six participating cities. The Swiss State Secretariat for Economic Affairs (SECO) is considering co-financing investments in Istravshan, Panzhakent, Shakhriston and Zafarobod with a capital grant of USD 8.5 million. While the European Union’s Investment Fund for Central Asia (IFCA) is considering co-financing the investments in Isaev and Yovon with a USD 7 million capital grant.

With this latest investment in Tajikistan’s water supply and water treatment systems, the Bank will now cover 21 cities throughout the country and help make safe drinking water available to 960,000 people.

Although land-locked, Tajikistan is abundant in water resources. Water in glaciers, lakes and rivers is the country’s greatest natural resource, yet the lack of adequate water infrastructure means that Tajik citizens often have limited access to safe water.

“The EBRD financing will enable the water companies in the six cities to upgrade their infrastructure, expand access to safe water to families that currently collect it from taps in the yards, and make sure households connected to the water supply system do actually receive water and are billed accordingly. This will help utilities become self-reliant,” says Ulf Hindstrom, Head of the EBRD’s Resident Office in Dushanbe.

Financial sustainability of the water operators is a crucial element of the EBRD’s integrated approach to improving Tajikistan’s water sector. For this purpose the Bank has previously helped develop a water tariff methodology to secure cost recovery levels, provided capacity-building support to the water sector and engaged stakeholders in sector reform.

“The EBRD is the strongest cooperation partner for the State Unitary Enterprise, Khojagii Manziliyu Kommunali, in the implementation of water supply improvement projects in the cities and rayons of the Republic of Tajikistan,” says Alimurod Tagoimurodov, Khojagii Manziliyu Kommunali’s General Director. “We hope that both North Tajik Water Rehabilitation Project II and Khatlon Water Rehabilitation Project which were signed today will be implemented successfully and positive results will be achieved and in due course. We also hope that the EBRD will continue its close cooperation with Khojagii Manziliyu Kommunali in similar projects in order to improve water supply and wastewater systems in other cities and rayons of the Republic of Tajikistan.”

Significant technical cooperation, funded by SECO, IFCA and the ETC Fund, will further help the water companies improve their performance as commercial entities, improve corporate governance, increase transparency and consolidate individual institutional capacities.

To date, the EBRD has committed over USD 319 million to various sectors of the Tajik economy.