The Government of Montenegro and EBRD sign Guarantee Agreement on the loan arrangement for and Montenegrin Electrical Transmission System

Podgorica, Montenegro (23 April 2014) – Earlier today at the Montenegrin Ministry of Finance, Finance Minister Radoje Žugić and EBRD Senior Advisor for Power and Energy Ian Brown signed Guarantee Agreement between the Government of Montenegro and European Bank for Reconstruction and Development (EBRD) worth EUR 20 million.

The Guarantee is approved for the loan arrangement between EBRD and Montenegrin Electrical Transmission System worth EUR 60 million (signed in October 2013) and envisaged within the Law on the budget for 2014.

These funds will be used for the construction and installation of 150 kilometres long high-voltage cable (400KW) between municipalities Tivat and Pljevlja, as well as for the construction of power station in place Lastva Grbljanska and reconstruction of power station in municipality Pljevlja. These projects represent a precondition for the construction of underwater power cable between Montenegro and Italy.

Implementation of these activities is aimed not only at strengthening of transmission network of Montenegro and more effective power supply at Montenegrin coast , but also at reducing the influence of the neighbouring electro-systems in the case of major damages.

Head of EBRD Office in Montenegro Giulio Moreno highlighted that implementation of this project is a proof of excellent cooperation between Montenegro and Italy and thanked the Ministry of Finance for financial support and significant role in the negotiation process.

Regarding development component of this project, the Government of Montenegro is willing to issue state guarantees solely for this kind of capital projects which will contribute to the dynamics of economic activities, Minister Žugić pointed out.