The European Investment Bank (EIB) is lending EUR 29.5 million to the Romanian Government for investments contributing to the improvement of the water supply services in small and medium towns.

The loan will help to implement the government's Small and Medium-Sized Towns Infrastructure Development Programme (SAMTID). SAMTID encourages smaller municipalities in the same county to group together into associations and delegate the operation and management of their water services to regional operating companies. The objective is to transform fragmented municipal services into larger scale, county-level utilities operating on a commercial basis. The Programme will improve water supply services and result in cost savings and the reduction of leakage through the replacement of network pipes and old pumps and installation of water consumption meters. The EIB loan will be combined with grants from the EU PHARE Programme.

The current loan will support the implementation of the second phase of SAMTID concerning municipalities located in six counties: Arad, Harghita, Mures, Prahova, and Suceava. To the first phase of SAMTID, the EIB had contributed with a loan of EUR 12.6 million.

The task of the EIB, the European Union's financing institution, is to contribute towards the integration, balanced development and economic and social cohesion of the Member States by financing sound investment. Outside the Union, the EIB supports investment projects fostering EU integration of the Acceding Countries (Romania and Bulgaria) as well as European development aid and cooperation policies.

Since 1990 the EIB has provided in loans in Romania approximately EUR 4.25 billion. More than 60% of this amount was investment in transport sector. Share of EIB lending in the areas of water and urban infrastructure represent some 16% of EIB funds extended in Romania so far contributing to an increase of quality of life in Romanian municipalities and helping to implement the European legislation in the area of environment.