ADB Supports Project to Preserve World's Second Largest Saline Lake

MANILA, PHILIPPINES - An ecologically significant lake in the Kyrgyz Republic will benefit from a water supply and sanitation services improvement project to be funded by the Asian Development Bank (ADB).

The ADB Board of Directors approved a $16.5 million loan and a $13.5 million grant for the Issyk-Kul Sustainable Development Project. The project is the first phase in a longer-term initiative by ADB to support environmental management and improve urban service delivery in the Issyk-Kul Oblast or Province. ADB and government collaboration in Issyk-Kul will ensure that urban services interventions will increase access to potable water and safe sanitation, including use of proven technologies for treatment and disposal of solid and liquid waste.

The project covers three cities of Balykchy, Cholpon-Ata, and Karakol on the northern shores of Lake Issyk-Kul, the world's second-largest saline lake. The lake is a Ramsar site of globally significant biodiversity and is designated as a biosphere reserve by the United Nations Educational, Scientific, and Cultural Organization (UNESCO).

The lake is a prime tourist attraction in Issyk-Kul Oblast, attracting about 1 million tourists annually, or 70% of the country's annual tourist arrivals of 1.4 million. The lake, however, is polluted partly due to excessive pressure on the deteriorating water supply and sanitation infrastructure serving the influx of tourists.

"Through the project, the infrastructure and quality of urban services in the region will improve, public health will improve, and the lake's environment will be preserved," said Vijay Padmanabhan, Urban Development Specialist in ADB's Central and West Asia Department.

The project comprises three parts. The first involves the rehabilitation, improvement, and expansion of water supply and sanitation services in the project cities. The second part will focus on improving service delivery and sustain long-term investments through improved enterprise resource management in cities, and water and sewerage utilities. The final part will support project management and implementation activities.

The ADB loan, from its concessional Asian Development Fund, will carry a 32-year term, including a grace period of 8 years, an annual interest rate of 1% during the grace period and 1.5% thereafter. The Government of Kyrgyz Republic will contribute $7.5 million toward the project.