Minister of Finance Petrit Malaj presented the draft law “On the ratification of the loan agreement for the ‘Municipal Infrastructure V – phase II’ program” on Thursday in the Parliament.

Malaj stated that this is an agreement that has to do with the implementation of one of the most important programs for investments in the water supply and sewage sector at the national level: the “Municipal Infrastructure V” program.

He emphasized that the cooperation between the government and German development bank KfW is long-standing and of particular importance, also starting from the financing portfolio.

According to the data, the minister added, “until the end of January 2026, the value of loans for active projects disbursed by this bank (KfW) is estimated at around Euro 432 million”.

Currently, he continued that the Ministry of Finance, together with other partner agencies, is reviewing this portfolio, with a focus on identifying new strategic projects and continuing support for economic and infrastructural development.

Malja underlined that the loan agreement of Euro 47 million between the Republic of Albania and KfW for the “Municipal Infrastructure V – Phase II” program has a strategic importance for the water supply and sewage sector.

Malaj added that the program “is also part of the projects to achieve the Sustainable Development Goals (SDG 6 – Ensure availability and sustainable management of water and sanitation for all)”.

Therefore, the minister emphasized, “this is not just an infrastructure project, but an investment with a direct impact on the lives of citizens, on the economic development of the regions and on environmental protection”.

He stated that the “Municipal Infrastructure V” program has been conceived in two phases. While, for the second phase, the minister underlined, “the secured financing of Euro 50 million includes: Euro 47 million of loan from KfW; Euro 3 million of approved grant”.

Regarding the loan terms, Malaj stated that it has a maturity of 15 years, where 5 years are free of principal payment, while the interest rate is fixed at 3.9%.

“The implementation of this phase will cover the cities of Shkodra, Lezha, and Saranda,” he said.

The Minister emphasized that the EU, through the WBIF instrument, will allocate an additional investment grant for this program in the amount of Euro 36.96 million, dedicated to the construction of wastewater treatment plants in Lezha and Saranda, covering 70% of the value of the respective investments.

Malja stated that the project being implemented will bring a series of concrete benefits to all regions where it will be located, by ensuring, firstly, a sustainable supply of drinking water.

Secondly, the Minister emphasized, this project ensures a significant improvement in sanitary conditions. Thirdly, Malaj stated, environmental and tourism protection is ensured. Fourthly, the minister continued, support is provided for regional economic development. After the discussions, the agreement was approved by the parliament.