Cooperation with Federal Republic of Germany

Cooperation with German Development Bank - KfW

 

Bilateral and multilateral development cooperation of Federal Republic of Germany is under the competence of the Federal Ministry of Economic Cooperation and Development (BMZ) (www.bmz.de). One of the organizations authorized by the Ministry for implementing the development cooperation is the German Development Bank (KfW). In fact, financial cooperation, as part of the German development cooperation, is implemented by KfW, while the technical cooperation is largely implemented by the German Association for Technical Cooperation (GTZ) (ww.gtz.de).

German Development Bank (KfW) is part of KfW Group (KfW Bankengruppe), in charge of financial cooperation with the developing countries. It provides long-term capital and encourages investments in the field of infrastructure, financial systems and environment protection (www.kfw.de). 80% of its capital is owned by Federal Republic of Germany and 20% by the federal provinces.

KfW mission in the Republic of Macedonia is promoting sustainable development, supporting transitional process and assisting in the EU accession process.

KfW offers support to the following sectors: provision of safe and high-quality utility services, water supply, wastewater and solid waste, nature and environmental protection, energy efficiency and renewable energy, and promotion of job creation through development of the private sector.

 

In line with the last Protocol from the negotiations for development and political cooperation between the Government of the Republic of Macedonia and the Government of the Federal Republic of Germany, signed in 2009, following areas of financial and technical cooperation were defined:

 

  • supply of drinking water/sewerage and environment protection;
  • sustainable economic development;
  • democratization/civil society.

 

Regarding the area of supply drinking water, sewerage and environmental protection, projects include investments in the water supply systems, wastewater treatment and wastewater treatment stations. These projects are aimed at protecting the environment of Ohrid and Prespa Lake, constructing new and rehabilitating the existing irrigation systems of the South Vardar Valley, water supply and sewerage for the municipalities and supply infrastructure development in Prilep. As regards KfW engagement in water and environmental protection, special emphasis is put on the institutional and financial reforms of the included utility enterprises and their support in this process.

Promotion of small- and medium-size enterprises is part of the sustainable economic development, i.e. implementation of economic reforms and building market economy. Placement of financial resources is realized by the Government of the Republic of Macedonia through the Macedonian Bank for Development Promotion, making these financial resources available for the Macedonian commercial banks granting favourable credits to small- and medium-size enterprises.

KfW also provides development assistance for projects that are part of the Energy Efficiency and Renewable Energy Programme. This joint cooperation is realized through the following projects: “Rehabilitation of Six Hydro Power Plants” and “Wind Park Bogdanci”.

KfW provides assistance through the small projects financed by the Social Infrastructure Fund. More than EUR 18 million was approved and implemented in around 140 small infrastructure projects in 38 municipalities in the Republic of Macedonia.

 

Projects financed by the Credit Bank for Reconstruction - KfW