Western Balkans

L'action de l'AFD dans les Balkans occidentaux, Serbie, Macédoine du Nord, Albanie, Kosovo, Monténégro, Bosnie Herzégovine, aide au développement — © Milos Golubovic / Flickr (CC BY-NC-ND 2.0)

Present in the Western Balkans since 2019, AFD's mandate is to support the convergence of countries in the region towards European Union standards and the implementation of the Paris Climate Agreement. In Albania, Bosnia and Herzegovina, Kosovo, North Macedonia, Montenegro and Serbia, AFD finances development projects and technical cooperation programs in support of an inclusive and low-carbon growth trajectory.

Context

Located in the heart of the Balkan Peninsula in southeastern Europe and surrounded by European Union (EU) member countries, the six Western Balkan countries are fledgling States experiencing profound political and economic changes. In terms of economic development, their situations vary: they rank between the 48th and 82nd place in the Human Development Index, and all had relatively high growth rates prior to the Covid-19 pandemic.

Today, Western Balkan countries are working to overcome their differences of the past, and focusing on their common values and heritage to build towards reconciliation. They are looking towards the European Union, for which an accession procedure is underway in Albania, Montenegro, North Macedonia and Serbia.

Joining the European Union requires undertaking sustainable reforms to firmly root the EU’s democratic values and legal standards in their political and economic systems.

Taking a sustainable and just development path poses major challenges, in particular in terms of education, migration, addressing inequality, infrastructure and strengthening the rule of law. It is becoming increasingly important to integrate the fight against climate change in public policy.

AFD is assisting Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia with their political, economic and social transformations towards EU standards and is supporting the implementation of their climate commitments.

AFD's Western Balkans office is directly attached to the Eurasia regional office in Istanbul.

Our approach

Below, discover AFD's commitment.

AFD and the Western Balkans: supporting an inclusive and sustainable growth trajectory

Climate action and investments supporting ecological and social transitions are at the core of AFD's mandate in the region. We are thus supporting Montenegro's efforts in terms of low-carbon transition and environmental protection through our support for the Investment and Development Fund. This project encourages climate-beneficial investments and the sustainable development objectives of SMEs and municipalities.

The support program for Serbia's climate roadmap and green agenda, initiated by AFD in partnership with the World Bank, mobilizes budgetary financing and technical support to work on climate policy, energy transition, environmental reforms, biodiversity and green finance. In the area of green growth, Proparco is also supporting Procredit Bank in Serbia for SMEs and green projects.

AFD pays particular attention to the social and professional integration of young people and to equality between women and men. Since 2019, AFD has been financing the WB6 Lab, an ambitious project aimed at opening up new spaces of reconciliation for young people in the Western Balkans through social entrepreneurship. In Albania, AFD supports the government through a loan and technical assistance to support public policies aimed at reducing gender inequalities in access to economic opportunities.

Cities are central in issues related to ecological transition, being both the most vulnerable and the most able to act at the territorial level. AFD supports regional development and encourages the development of urban infrastructure, for sustainable management of cities and better resilience against climate change.

In the Western Balkans, AFD is thus working, through the Smart City program, with the municipalities of Tirana, Podgorica, Pristina and Skopje in the development of local digital action plans. The objective is to support these local authorities in their urban planning, through a digital and resilient approach to the consequences of climate change.

Proparco is also engaged in a public-private partnership for the extension of Belgrade airport.

Mobility is a necessary condition for people's access to employment and essential services. AFD provides financial support, alongside the World Bank, to the modernization of the railway sector in Serbia. The program aims to improve Belgrade's rail service and network safety through the renewal of tracks and tunnels, the development of the Belgrade Center station, the redevelopment of level crossings and the strengthening of the capacities of public companies in the sector.

Reducing the environmental and health impact of waste is central in the EU accession agenda and strongly contributes to improving living conditions. AFD supports Serbia through a national solid waste management program in partnership with the EBRD. This project aims to develop and modernize solid waste management infrastructure and promote an integrated approach to the sector in order to recover the waste produced.

AFD also works for the sustainable use of water resources and supports the optimization of water distribution networks and the renovation of sanitation infrastructure. A loan and a grant were granted to rehabilitate and extend the water networks of Durrës in Albania and to carry out the master plan for sanitation in the city.

AFD places universal access to efficient and carbon-free energy services at the heart of its action. We support the Western Balkan countries in their efforts to structure the electricity market, in accordance with the 3rd Energy Package of the European Union, thus developing a regulatory framework adapted to the promotion of renewable energies and energy efficiency.

In partnership with KfW, AFD granted a sovereign loan accompanied by technical assistance to Albania, to support institutional restructuring, the creation of the energy market and the diversification of the electricity mix. A second operation is planned by AFD and KfW to finance the second phase of this reform.

Proparco has also invested in the construction and operation of a wind farm in Montenegro.