Over €1 billion for urban development and just transition under the Regional Development Programme 2021-2027

Up to €400 million will support investments in cities, with an additional €600 million focused on just transition

More than EUR 1 billion for urban development and just transition are provided under the Regional Development Programme 2021-2027. They will support investments with long-term effects on the urban environment, the economy and quality of life in cities, as well as in the territories most affected by the transition to a climate-neutral economy.

The funds for urban development are provided through a financial instrument under the Program "Regional Development" 2021-2027 - "Urban Development Fund". The financial instrument will be implemented through three funds – two for Northern Bulgaria and one for Southern Bulgaria. The two funds for Northern Bulgaria are defined on a competitive basis. The total public resource for the financial instrument for urban development is EUR 262.5 million provided under the RDP 2021-2027 and the Competitiveness and Innovation in Enterprises Programme 2021-2027. With additional private financing attracted by financial intermediaries, the total investment resource is expected to reach up to EUR 400 million. They will provide long-term loan financing until the end of 2029 for public and private projects supporting sustainable urban and regional development.

50 municipalities can apply for the funds - 10 large and 40 medium and smaller urban municipalities. For RDP projects, a new possibility is also envisaged – the loan financing to be combined with a grant within a single operation. This will allow for a more flexible structuring of investments according to the specific needs of the projects.

Funding will be channelled to urban modernisation and development projects; green infrastructure and energy efficiency; sustainable urban mobility; health, social and educational infrastructure; culture and sport; tourism; development of economic activity.

The actual implementation of the financial instruments became possible after the signing of the operational agreements between the Fund Manager of Financial Instruments (FMFIB / Fund of Funds) in Bulgaria with the two selected financial intermediaries – DZZD “Fund for Sustainable Cities” and Consortium “Fund for Green and Smart Urban Development”. Further information can be found at the following email address: https://www.citiesfund.bg/urban-development-funds-2021-2027/requirements/. 

Another EUR 600 million is added to the urban development resource under Priority 4 “Just Transition” of the RDP 2021-2027. The resource is provided by the Just Transition Fund and is co-financed by the state budget. The funds will be managed by the Fund Manager of Financial Instruments in Bulgaria to support the territories most affected by the climate transition. Through selected financial intermediaries, financial instruments and grants will be implemented in accordance with the investment strategy and business plan in the three coal regions of Pernik, Kyustendil and Stara Zagora.

The Fund is about to announce a procedure for the selection of financial intermediaries through which support will reach the final recipients.