The Government of Montenegro and the World Bank signed today the Loan Agreement which provides €4.5 million for the design and construction of the Možura sanitary landfill and for the equipment necessary for the operation of the landfill. The Možura sanitary landfill will be designed to collect waste in the municipalities of Bar and Ulcinj/Ulqin for the next 28 years.

This loan agreement represents Additional Financing for the Montenegro Environmentally Sensitive Tourist Areas Project (MESTAP), which had been approved by the World Bank Board of Directors in September 2003 in the amount of US$7 million.

The Additional Financing was approved by the World Bank Board of Directors on December 20, 2010. The activities of the project will help to protect Montenegro’s beautiful costal area from threats posed by pollution from inadequate solid-waste collection and disposal system.

Tourism represents a key sector for the country’s economy and a major source of growth. However, pollution caused by solid waste in the coastal areas of Montenegro has reached alarming proportions that risk undermining the development of sustainable tourism. Most of the municipal landfills are operated in unsanitary conditions, including the uncontrolled burning of waste. In addition, having recently been granted the status as candidate for EU membership, the Government of Montenegro has committed itself to the harmonization of its environmental standards with those prevailing in the EU. Both the original MESTAP and this Additional Financing support Montenegro’s efforts in achieving both goals.

“Following MESTAP’s thorough preparation, we are encouraged by the impetus that it has created in devising and implementing a national solid-waste strategy far beyond the project’s scope, based on the conviction that the protection of the environment is vital not only for the crucial tourism sector but also for sustainable economic development and improved social welfare,”

said Jan-Peter Olters, World Bank Representative in Montenegro.

The selected landfill site is located at Možura in the Municipality of Bar, 17 km southeast of the city of Bar and 11 km northwest of the city of Ulcinj/Ulqin.

The financing instrument would be an IBRD Loan repayable in ten years, including a grace period of four years.