This program aims to improve the operational and financial performance of water supply and sanitation services and increase access to safe water services in Albania.
Albania does not lack adequate water resources and therefore should be able to provide all of its population with fresh and safe drinking water. In recent years, Albania has developed a strong regulatory framework for the provision of water services and introduced changes in institutional arrangements to improve service delivery.
Nevertheless, most water utilities in Albania continue to perform poorly, both technically and financially. This translates into low levels of service to people and businesses, and an inability to extend services to those who have none, especially the most vulnerable in peri-urban and rural areas of the country. About 20 percent of the rural population has no home network access. Most public services are chronically dependent on central government funding. 37 of the 58 municipal water companies continued to depend on budget support. The water supply and sanitation sector (WSS) needs reforms in its governance and organizational models to improve and achieve national goals.
“Radical changes are needed to improve the quality and sustainability of water supply services. We commend the government for its commitment to reforming water services in Albania,” said Emanuel Salinas, World Bank Country Director for Albania. “The World Bank will support the sector through an innovative financing instrument called Program for Results. This means that, rather than just providing funding for infrastructure, we will focus on supporting institutional reform, or as we informally call it ‘instead of fixing the pipes, let’s fix the institutions that are supposed to fix the pipes’ “.
The WSS program will help deepen the transformation of the sector to address the structural challenges it faces. It will strengthen investment planning and programming, both locally and centrally, in the WSS sector, enabling the expansion of public investments in peri-urban and rural areas. As part of these reforms, water utilities should improve their performance, relying less on public funds. Efficient use of public funds will not only benefit individual households, but will also stimulate the economy. Improving the quality and reliability of services for residents and businesses will have a positive impact on the tourism industry, job creation and poverty reduction, as well as reducing the urban gap /rural.
The new operation uses a program results-based (PforR) financing instrument, which directly links loan disbursement to the achievement of specific program results. The grant will finance technical assistance, capacity building within central sector institutions, implementation and monitoring, as well as evaluation of program results.
This program is designed and implemented jointly by the Ministry of Infrastructure and Energy and the Agency for Water Supply, Sanitation and Waste (AKUM), as well as the Ministry of Finance.