Photo: European Union
Economy
Posted: 1 month ago

Georgia Receives Further Financial Support to Develop Green Economy

On May 28th 2020 the Minister of Finance of Georgia, H.E. Mr. Ivane Matchavariani and KfW Development Bank’s Regional Director of Eastern Europe, Caucasus and Central Asia Mr. Olaf Zymelka signed the Loan Agreement of EUR 90 million for the “Support of Georgia’s Energy Sector Reform”.

A second loan agreement worth of EUR 120 mln was signed on 22nd of May by the Minister of Finance of Georgia, H.E. Mr. Ivane Matchavariani and French Ambassador in Georgia, H.E. - Diego Colas, and AFD’s Director of the regional office for the South Caucasus Ms. Gaelle Assayag,

Continued support to the sector reform has been ensured by the Governments of Germany through the Federal Ministry for Economic Cooperation and Development (BMZ) and of France via the Agence Française de Développement (AFD).

The EU grant support of EUR 8,44 million under EU’s Neighbourhood Investment Platform (NIP), provided to the Georgian Government and administered by KfW will facilitate the elaboration of the secondary Energy Efficiency legislation in 2020-2021. Its aim is in particular to promote Energy Efficiency especially in the building sector in addition to the market reform measures to support moving Georgia from a centralized electricity market to an organised market as envisaged by EU’s Third Energy Package.

On June 2nd, the Program Steering committee of the Energy Sector Reform Programme came to the conclusion that the Sector Reform showed sufficient performance to make available the financial resources mentioned above. Key achievements were the recent adoption of a comprehensive law package to enforce Energy Efficiency in buildings and of a modern market concept for Georgia’s electricity market of the future. 

Furthermore, to kick-start the sector development for Energy Efficiency in buildings and to support the implementation of EU-Energy Efficiency standards in Georgia, Germany also provided additional grant funding (EUR 7.4 million) for investments into Energy Efficiency Measures in social infrastructure (Kindergartens) in Batumi. In addition, KfW is preparing a school Energy Efficiency rehabilitation investment program for Georgia with the support of EU and German Government.

"KfW is happy to continue its fourth year assistance to Georgian energy reform, jointly with our trusted partners AFD and EU. With our combined efforts we work closely with the Government of Georgia and other stakeholders in moving ahead towards EU standards. KfW’s and its partner’s primary focus is to develop green economy through the promotion of public policies in favour of Energy Efficiency. Modernisation of the electricity market of Georgia is another milestone set forth to overcome EU approximation challenges.” said Hans Rieck, responsible for KfW’s Sector Energy in the South Caucasus.