Services rendered by the municipalities in Macedonia that moved to the second stage of decentralization will be improved through projects to be financed with World Bank loan in the amount of EUR 18.9 million. Loan Agreement for the Municipal Services Improvement Project was signed today by the Minister of Finance of the Republic of Macedonia, Mr. Trajko Slaveski, and World Bank Resident Representative, Marcus Repnik.

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The project is part of the four-year Strategy of the International Bank for Reconstruction and Development – World Bank Country Partnership Strategy 2007-2010. Main goal of the Project is through on-lending funds to municipalities, municipalities in the City of Skopje and the City of Skopje, to public enterprises established by the municipalities, municipalities in the City of Skopje and the City of Skopje, to provide for realization of municipal projects that will contribute to improving the performances of the municipalities, the quality of utility and communal and other municipal services, as well as developing and strengthening the municipal competences and functions, Ministry of Finance announced.

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The Project will include municipalities that have moved to the second stage of decentralization and have met the requirements for long-term borrowing. With respect to settlement of liabilities arising from the on-lending of loan funds, Ministry of Finance will conclude separate sub-loan agreements with the loan beneficiaries – municipalities and/or public enterprises.
Each municipality that will meet the criteria will be extended grant funds up to 20% at the most of the amount of the extended loan. Grant funds can be used after the municipality meets the respective requirements and criteria agreed with the World Bank, proving it has improved its operations, and will be used exclusively for investment activities.

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According to the Ministry of Finance, Municipal Services Improvement Project can be used to finance projects in the area of water supply, solid waste management and other investments that generate revenues or create cost savings: financing construction works, equipment and respective consulting services for extension of other services or enlargement of facilities within the competence of the municipalities, public buildings, urban transportation systems and similar, so as to reduce the energy consumption or to increase efficiency in any other way.(MIA)

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