The National Strategy for Sustainable Development of Montenegro highlights the importance of developing infrastructure, including wastewater treatment, as a precondition for further development of the country. The absence of such infrastructure directly inhibits the country's economic growth by jeopardizing its natural resources, limiting the potential for foreign investment and restricting the development of tourism. Montenegro has serious problems with the water distribution system. Water consumption levels are too high, especially during the summer when water resources are limited. This water shortage is exacerbated by the poor condition of the water distribution network. Wastewater discharges to the water bodies are another serious problem. In almost all municipalities, wastewater either drains into rivers or the ground.
The project aims to improve the quality and sustainability of Montenegro's environmental wastewater infrastructure base mainly in the north and interior of the country. A EUR 5 million grant is provided by the EU as a contribution to the construction and upgrading of water and wastewater infrastructure in five municipalities across Montenegro. This grant from the Municipal Window of the Infrastructure Project Facility will be combined with a loan from the European Investment Bank (EIB) in the context of the Western Balkan Investment Framework. This investment is part of the Montenegro Water and Sanitation Project, which already benefits from an EIB loan aiming at improving water and sanitation in some 12 municipalities of Montenegro for a total investment of EUR 114 million and an EIB loan for EUR 57 million.
The contribution agreement with the EU was signed in 2009 and construction started in 2013. The improvements to water and wastewater infrastructure in the 5 municipalities are planned to be completed by the end of 2017.
The project has many environmental, economic and social benefits. Efficient and sustainable water supply and wastewater systems are a precondition for the economic development and health well-being of the population. The new systems will improve the quality of water supply and wastewater service and contribute to compliance with EU environmental standards given the eventual EU accession. The project will also improve the water quality in the rivers flowing to the Adriatic Sea and neighbouring countries. The wide range of beneficiaries of this project includes primarily households and industrial water consumers in the municipalities, but also the overall population of Montenegro and neighbouring countries.