Manila - The Asian Development Bank (ADB) said Saturday it was providing its first-ever public sector loan worth 40 million dollars to help Georgia rehabilitate services and infrastructure damaged in the recent conflict with Russia.

The Manila-based ADB said a 32-year concessional loan will be extended to Georgia's Municipal Development Fund, which will in turn provide funds to local governments to rebuild infrastructure, and improve quality, coverage and continuity of critical urban services.

The funds will be provided to financially weaker municipalities as grants, the bank said.

It noted that Georgia's municipal services have fallen into disrepair since the collapse of the former Soviet Union.

"Most urban water supply systems are more than four decades old, only five of 29 wastewater treatment plants are still operating, and poorly managed solid waste disposal sites damage the environment," the ADB said in a statement.

The country's network of urban roads is also in urgent need of rehabilitation.

"Many municipalities in Georgia don't have the resources they need to give their people clean drinking water, good roads and other basic services," said Juan Miranda, director general of ADB's Central and West Asia Department.

"This negatively affects families' quality of life, hampers development and constrains investment and job creation," he added. "The recent conflict in Georgia adds a new level of urgency to the need for immediate rehabilitation and reconstruction assistance."

ADB staff are currently on the ground in Georgia as part of an international needs assessment team to assess both direct, immediate damage of the conflict and its medium-term impact on infrastructure and service provision. (dpa)