The World Bank approves loans worth 60 million dollars to Albania

TIRANA, Feb. 26 – The World Bank approved a total of 60 million euro loans designed to help Albania complete a road and assist with a land reform project.
A 25 million dollar loan will help the Albanian government complete and maintain a 16-mile segment of the 105-mile road linking the Albanian port city of Durres with the Morine border crossing point to Kosovo. A statement was issued in Washington, explaining that the new project is financed by a Credit and a Loan, blending IDA and IBRD resources for an amount of US$5 million and US$20 million respectively. The project will finance the construction of the Milot-Rreshen section of the Durres-Morine corridor and improve access for the hinterland population. The total project cost is US$56 million and is also co-financed by the Government of Albania (US$16 million) and OPEC Fund (US$15 million). Transport demand is growing rapidly in Albania, reflecting the structural changes in the economy and changes of the trade flow in the region. However, the road infrastructure compares poorly to regional comparators. Lack of maintenance has contributed to the deterioration of the network and increased the costs of road users. Road accidents are a serious and increasing public health issue. Poor transport infrastructure is negatively impacting the Albanians standard of living. To address these challenges the Government of Albania has recently adopted the Albanian National Transport Plan. According to this plan the Durres – Milot – Morine corridor is the foremost priority of the Government of Albania. This road corridor will benefit the development of the hinterland population approaching 110,000 people, in one of the poorest regions in Albania.
“The new project will reduce the user costs on the Milot-Rreshen section and improve for the poor population of this area. It will also introduce innovation in road maintenance and contribute to the development of the institutional framework and implementation of road safety activities throughout Albania”, said Richard Martin Humphreys head of the World Bank team designing the project.
The project has four components: construction of the 26 kilometers section between Milot and Rreshen; introduction of innovation in road maintenance on a pilot basis; road safety; and technical assistance and equipment.
It is expected that the construction of this section will reduce the journey time by 25 percent, will improve population access to services and increase road safety.
The World Bank approved also a $34.96 million Land Administration and Management Project. The new project is financed by a Credit and a Loan, blending IDA and IBRD resources for an amount of US$15 million and US$19.96 million respectively. The project will support the Government’s efforts to facilitate the development of an efficient land and property markets through enhancing tenure security and improving land administration and management services. The total project cost is US$56 million and is also co-financed by local government (US$9 million), Swedish SIDA (US$1.50 million) and Grants by the Japanese Government (US$0.2 million).
Albania has carried out land and property administration reform since early transition and substantial progress has been made in ownership transfer and recognition of property rights. Despite this progress, land management in Albania continues to face significant challenges. Land and property rights are not fully secure. There is need to transform the Immovable Property Registration Office into an efficient, transparent and effective organization. The slow pace of resolution of restitution and compensation process has undermined the security of property rights and slowed down the registration of property rights. The rapid urbanization in absence of sound policy and enforcement of laws is considered a major threat to sustainable urban development in the country. In addition, local authorities often do not have the capacity or the financial resources to undertake many functions of urban land management. This project aims to address all these challenges.
“Secure property rights along with an efficient and transparent land management regime are fundamental for creating well functioning land and property markets in Albania. These in turn, provide incentives for local and international businesses, households and individuals to invest in land and properties. Furthermore, secure property rights, proper land management and development control system are enabling factors in improving investment climate, urban management, natural resources management, and in promoting good governance”, said Wael Zakout, head of the World Bank team designing the project.
The project will focus on three main areas necessary to promote the development of an efficient land and property markets: improving the security of tenure; strengthening local government capacity to develop and enforce land use plans; and supporting the development of property taxation function.
By the time the project is completed, it is expected that the average time to register property transaction will be reduced from 47 to 10 days; the average time to issue building permit will be reduced from 6 to 3 months; the annual property tax collection for the participating municipalities will be increased by 10 percent; and in general, the level of confidence in security of property rights will be increased.
The World Bank has been a main financer of Albania since the small, poor Balkan country joined the bank in 1991, committing about $ 915 million.