World Bank’s help in KESH privatization

TIRANA, May 28 – The World Bank issued a statement Wednesday to show that through the International Financial Corporation it has been assisting in the privatization process of KESH distribution arm which has been already launched, also saying that several international investors have already expressed their interest.
The Ministry of Economy, Trade and Energy (METE) recently launched the tender for the privatization of the distribution arm of KESH with the publication of the Invitation for Prequalification Applications in the Financial Times, the statement said.
The IFC, a member of the World Bank Group, is assisting Albania in this privatization process under a mandate with METE. IFC has been engaged to advise METE on the unbundling of KESH’s distribution business assets from its other activities, structuring a transaction to attract the private sector, and executing an open, transparent and competitive process to attract the optimal private partner to operate and develop the company.
Several potential international strategic investors came to Tirana on April 8th for a KESH investors conference, and expressed interest in the privatization.
The Albanian Government plans to sell between 51 percent and 76 percent of the distribution business of KESH to a strategic investor via an open international tender. The privatization is a necessary step in order to reduce electricity distribution losses that continue to plague Albania. These losses “are around 2 billion KWh a year, out of which 1 billion KWh being non-technical losses, which cause huge economic damage” according to the country’s energy regulator, ERE. Therefore the privatization will have a significant positive impact on the Albanian economy. The unbundling and privatization of the distribution company is also a key step on the irreversible path to EU integration. The World Bank and USAID have been participating in and supporting this process through donor programs. The privatization of the power distributor is the largest and most complex privatization to date in Albania. (Tirana Times Staff)