Montenegro: First EIB loan for education projects
- Nov 6, 2019
The EIB announced today its first investment in an education project in Montenegro, by contributing to the upgrade of the school system in the country. This is part of the Bank’s ongoing support for education in the Western Balkans region.
- The EUR 18m loan will finance the construction and renovation of education facilities and kindergartens in the capital Podgorica and in nine municipalities across the country
- The financing operation will focus on increasing the country’s schooling capacity by creating an additional 2,070 places
- Strong employment impact with the creation of around 530 new full-time jobs, mostly for teachers
- This first EIB project in the education sector in Montenegro will also benefit from an Economic Resilience Initiative (ERI) grant
The European Investment Bank (EIB) announced today its first investment in an education project in Montenegro, by contributing to the upgrade of the school system in the country. This is part of the Bank’s ongoing support for education in the Western Balkans region.
The total investment amount is estimated at over EUR 40m, in support of which the bank of the European Union will provide a EUR 18m loan. The financing will partly fund the construction of three primary schools and one new secondary school, and the renovation of three kindergartens and 10 vocational schools.
The investment also includes the provision of new information and communications technology equipment, specific equipment for vocational schools and new school furniture. The investments will take place in the capital of Montenegro, Podgorica, and in nine municipalities across the country (Kotor, Berane, Plav, Bijelo Polje, Bar, Budva, Cetinje, Herceg Novi and Rozaje).
The project will increase the country’s schooling infrastructure capacity by creating an additional 2,070 places. This, together with existing available capacity, will help to alleviate overcrowding in some primary schools and increase children’s access to pre-primary level education.
The project contributes to the objectives of the Economic Resilience Initiative and will also benefit from an ERI grant to provide technical assistance regarding the procurement and implementation of the project. The project will not only scale up investments in education facilities, it will also provide better learning tools to upskill young students, thereby improving youth employability.
In addition to supporting the development of education in the country, the investment will also have a significant employment impact with the creation of around 530 new full-time jobs, mostly for teachers.
Regarding the EIB’s support for education in the Western Balkans region, in recent years the EU bank has financed the School Modernisation Programme (EUR 50m) and the Public Sector Research and Development project (EUR 200m), both in Serbia.
The loan agreement was signed today in Podgorica by the EIB’s Head of Division for Slovenia, Croatia and Western Balkans, Matteo Rivellini, and the Minister of Finance Darko Radunović in the presence of the Minister of Education, Damir Šehović and of the Head of Cooperation at EU Delegation Hermann Spitz.
"I am really pleased with this operation in the education sector: we firmly believe that investing in people is the best way to support human empowerment, growth and development across the whole Western Balkans region and now also in Montenegro", noted Dario Scannapieco, EIB Vice-President responsible for operations in Italy, Malta and the Western Balkans. "We appreciate the efforts made by the Montenegrin Government to invest in a sector that is crucial for the future. These projects have a long-lasting return which will substantially benefit the country's competitiveness.”
“The Montenegrin Education Improvement Programme is a continuation of the successful long-term cooperation between the European Investment Bank and the State of Montenegro; we strongly believe that the Project will greatly contribute to the improvement of education in Montenegro and, consequently, to the further improvement of cooperation between Montenegro and the EIB”, said the Minister of Finance Darko Radunović.
“The EUR 18m loan signed today between the Government of Montenegro and the EIB facilitates the development of infrastructure predominantly in Podgorica but also in some other municipalities. As a result, by 2023 over 8,000 students will learn in better conditions and more than 2,000 new students will be accommodated in schools. This loan perfectly complements the assistance provided by the EU through the joint EU-Montenegro Programme for Employment, Education and Social Welfare, under which a grant of more than EUR 2.7m has been allocated for the education sector alone”, said Hermann Spitz, Head of the Cooperation Section at the EU Delegation to Montenegro.
Note to editors
The EU bank has been active in Montenegro since 1977, financing 23 projects to date. In the last 10 years, it has approved loans worth a total of EUR 737m, notably in infrastructure (roads and railways). The EIB is the leading international financier in the Western Balkans. Since 2007, the Bank has financed projects totalling almost EUR 8bn in the region. Besides continuing its support for the reconstruction and upgrading of public infrastructure, since 2010 the EIB has expanded into many new areas, such as healthcare, research and development, education and SMEs.
The Economic Resilience Initiative was created in 2016 in response to a call from the European Council. The objective of the initiative is to help shift patterns of migration in the medium to long term and provide support to forcibly displaced populations by increasing economies’ resilience to future shocks. The ERI is doing this by mobilising finance to support growth, job creation, vital infrastructure projects and social cohesion in the EU’s neighbouring regions. It will provide an additional EUR 6bn of financing in the Southern Neighbourhood and Western Balkans regions over the 2016-2020 period. This is expected to mobilise EUR 15bn of new investment.