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IFC finances Serbian waste-to-energy, landfill project

Landfill

BELGRADE (Serbia), October 4 (SeeNews) – The International Finance Corporation (IFC), a World Bank member, is providing a 259.57 million euro ($284.8 million) financing and guarantees package for the construction of a new landfill and energy-from-waste facility in Serbia's capital Belgrade, the lender said.

The financing will be provided to Beo Cista Energija, a special purpose vehicle formed by the French utility company Suez, Japanese conglomerate Itochu and pan-European equity fund Marguerite Fund, through the IFC and the Multilateral Investment Guarantee Agency (MIGA), IFC said in a statement on Thursday. 

"This is one of the first large-scale, bankable, private sector projects in the waste-to-energy sector in emerging markets," Thomas Lubeck, IFC regional manager for Central and Southeast Europe, said. "This landmark project in the City of Belgrade has the power to become an example of a sustainable solution for cities in other emerging markets to solve pressing waste management challenges using the technology and efficiency of the private sector."

IFC's financing includes an A loan of up to 72.2 million euro, a parallel loan from Oesterreichische Entwicklungsbank (OeEB) of up to 35 million euro, a B loan of up to 35 million euro, and a concessional senior loan of up to 20 million euro from the Canada-IFC Blended Climate Finance Programme. It is part of a wider package that includes an European Bank for Reconstruction and Development (EBRD) loan of up to 128.2 million euro.

MIGA guarantees of 97.3 million euro are being provided for up to 20 years against non-commercial risks, including breach of contract. The guarantees are covering up to 90% of investor equity in Beo Cista Energija d.o.o.

"MIGA guarantees are playing a vital role in enabling long-term private sector investment into this crucial project,” Elena Palei, MIGA global head for infrastructure, said “By backstopping the obligations of Belgrade city, we are helping provide comfort to investors without the need for a sovereign guarantee, which has a positive impact on Serbia’s fiscal space."

The investment includes the construction of an energy-from-waste facility, a facility for construction and demolition waste (CDW), the remediation, closing and aftercare of the existing Vinca landfill and the construction of a new EU-compliant landfill.

($ = 0.91138 euro)

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