Municipal Infrastructure Fund (MIDF)

completed

In the countries of the Western Balkans, many municipalities still have a high need for investment to expand and maintain public infrastructure. At the same time, with the exception of Serbia, local banks are hardly active in municipal financing, which is why municipalities are dependent on financing from foreign donors or budget allocations from central governments. Smaller and medium-sized municipalities are often structurally disadvantaged in this regard, as the financing volumes they require are too small for the typical foreign donor programs. The Municipal Infrastructure Development Fund (MIDF) for Southeast Europe is intended to help solve this problem by offering financing for the implementation of infrastructure measures in small and medium-sized municipalities together with local banks. The MIDF will be limited to the ODA recipient countries in the Western Balkans, i.e. Albania, Bosnia-Herzegovina, Kosovo, Macedonia, Montenegro and Serbia. Publicly usable infrastructure measures (such as water supply and disposal, district heating, waste disposal, energy efficiency measures in buildings, public transport, etc.) are to be financed with a debt financing volume of at least EUR 100,000 and a maximum of EUR 5 million per project. The MIDF is aiming for a total financing volume of EUR 80-100 million. In addition to the German Federal Financial Supervisory Authority, the EBRD and the Swiss SECO are planning to participate in the fund's capital. Talks with other potential investors are still ongoing. The Austrian ADA and the Swiss SECO are also providing additional grants for personnel support measures for the partner banks and the municipal final borrowers totaling EUR 5 million.