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Western Balkans Municipal Infrastructure Development Fund

Local infrastructure across the Western Balkans suffers from a significant backlog of investments. The Municipal Infrastructure Development Fund is an innovative financing vehicle dedicated to support municipal infrastructure projects by providing the long term funding and sustainability in municipal services.

Strategic Domain:
Economy and Employment
Municipal Services
Strategic Partner:
Frankfurt School Financial Service GmbH
European Bank for Reconstruction and Development (EBRD)
Project implemented in:
Federation of Bosnia and Herzegovina, Brčko District, Republika Srpska, Global and regional projects
Sarajevo Canton
Municipalities (3):
Brčko distrikt, Banja Luka, Grad Sarajevo

Access to long term funding for municipal infrastructure projects

Local infrastructure across the Western Balkans suffers from a significant backlog of investments. This is due to a significant funding shortfall faced by municipalities in the region. Given the region is expected to join the European Union, this situation is not tenable.

Against this background, the European Bank for Reconstruction and Development (EBRD) and the German KfW Group estab- lished with the support of SECO the Municipal Infrastructure De- velopment Fund (MIDF) in order to provide the long term funding needed for infrastructure investments, help closing the funding gap, and promote long-term sustainability in municipal services.

MIDF  cooperates  with  carefully  selected  local  commercial banks in the region to expand access to funding sources. MIDF cofinances municipal infrastructure projects with the participating banks by sharing lending risks and/or providing liquidity. MIDF supports local banks in developing sound financing structures for municipal infrastructure investments. This includes the establishment of systems and methodologies for risk assessment, the drafting of financial document templates, social and environmental due diligence preparation, and procurement and concession monitoring.

In addition, MIDF supports its beneficiaries in increasing their capacity throughout the project development and implementation cycle. This includes the preparation of feasibility studies, project designs, tender documents, procurement and concession reviews, and project monitoring.

Eligible  Investments

  • Water supply and treatment
  • Waste management and recycling
  • Energy and heat supply
  • Public transport and traffic infrastructure
  • Buildings and energy efficiency

Eligible  Beneficiaries

  • Municipal and regional governments
  • Municipality-owned entities or companies
  • Other public institutions owning or operating municipal infrastructure
  • Private sector operators involved in the provision of municipal services