Albania secures a 47 million euro loan from KfW to modernize water supply systems in Shkodra, Lezhë, and Saranda

The Albanian Parliament has officially approved the ratification of a 47 million euro loan agreement with the German development bank KfW. The funds are earmarked for the implementation of the second phase of the large-scale “Municipal Infrastructure V” program, which is of strategic importance for the country’s water supply and sewerage sector, BalkanEngineer.com learned from official documents presented by Finance Minister Petrit Malaj.

The investment package, which also includes an approved grant of 3 million euro, will cover the cities of Shkodra, Lezhë, and Sarandë. The loan was agreed upon under exceptionally competitive terms—a 15-year repayment period, including a 5-year grace period, and a fixed interest rate of 3.9%. The project is part of Albania’s commitment to achieving the UN Sustainable Development Goals (SDG 6), ensuring continuous access to drinking water and modern wastewater management for thousands of citizens.

In addition to the core funding, the European Union will provide an additional grant of €36.96 million through the WBIF investment instrument. These funds will cover 70% of the costs of constructing wastewater treatment plants in Lezhë and Sarandë. The project is expected to improve sanitation and environmental protection, as well as stimulate economic development and tourism in these regions, reinforcing the long-standing partnership between Albania and KfW, whose active portfolio in the country now totals 432 million euro.

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