Over €1bn for Urban Development and Just Transition Under 2021–2027 Regions in Development Programme

More than €1 billion has been secured for urban development and a just transition under the 2021–2027 Regions in Development Programme. The funding will support investments with a long-term impact on the urban environment, the economy and quality of life in cities, as well as in the areas most severely affected by the transition to a climate-neutral economy.

Funding for urban development has been secured through a financial instrument under the 2021–2027 Regions in Development Programme – the 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 were selected through a competitive procedure. The total public funding available for the urban development financial instrument amounts to €262.5 million, provided under the 2021–2027 Regions in Development Programme and the 2021–2027 Competitiveness and Innovation in Enterprises Programme. With additional private financing attracted by financial intermediaries, the total investment resource is expected to reach up to €400 million. This will provide long-term loan financing until the end of 2029 for public and private projects supporting sustainable urban and regional development.

A total of 50 municipalities – 10 large and 40 medium-sized and smaller urban municipalities – will be eligible to apply for the funding. Projects under the Regions in Development Programme will also benefit from a new option allowing loan financing to be combined with grant funding within a single operation. This will allow investments to be structured more flexibly according to the specific needs of individual projects.

Funding will be directed towards projects for the modernisation and development of the urban environment; green infrastructure and energy efficiency; sustainable urban mobility; healthcare, social and educational infrastructure; culture and sport; tourism; and the development of economic activity.

A further €600 million under Priority 4 “Just Transition” of the 2021–2027 Regions in Development Programme will be added to the urban development resource. The funding is provided by the Just Transition Fund and co-financed by the state budget. It will be managed by the Fund Manager of Financial Instruments in Bulgaria to support the areas most severely affected by the climate transition. Through selected financial intermediaries, financial instruments and grant funding will be available in line with the investment strategy and business plan for the three coal regions of Pernik, Kyustendil and Stara Zagora.

The Fund is due to launch a procedure for selecting financial intermediaries through which the support will reach the final beneficiaries.