In the course of the project 'Dredging Kuressaare Bay and Constructing a Yacht Harbour' (1995-1999), Stage I of the harbour was constructed in a derelict area (both water and land) of a former harbour site. The harbour was built to receive yachts and its future development envisaged the extension of berths for yachts and building berths for small craft. Several years ago, the living standard of the people of Estonia and Latvia was rather low and there was no demand for maritime tourism facilities among the people of both countries. Currently, there is a high demand for facilities for developing maritime tourism between the two countries. The number of visiting yachts from Latvia is increasing and there is a high interest among Latvians in visiting Estonian islands particularly as there are no islands in Latvia. The harbour is located in a 10 minutes walking distance from the city centre, in the recreation area of the city and next to spas that have been built as a result of the coastal development programme. Constructing berths for small craft is a precondition for launching a regular boat connection between Kuressaare, Riga and Roja on which there is a high demand in both countries today. The yacht harbour has a wider cross-border impact as it receives sailing boats from all countries around the Baltic Sea and even further away. In 2004, the number of visits increased for 54% compared to 2003. While in 2003 Kuressaare held the 12th position in the number of visits among Estonian yacht harbours, in 2004 it held the 8th position and it held the 1st position among the harbours in the Gulf of Riga. In 2005, the estimated increase in visits will be another 30%. The problem is that the harbour has no capacity for receiving the increasing number of boats. Kuressaare Yacht Harbour is in municipal ownership and as the socio-economic benefits for the town are much more considerable than the direct profit to the harbour would be, Kuressaare Town Government feels responsible for the harbour development. Current project is a single partner infrastructure development project and carries the objective of developing Kuressaare Yacht Harbour for receiving small craft and increasing the capacity of receiving yachts in order to promote tourism development in Saaremaa and Latvian coastal areas. The project is targeted at the harbour construction, including: embankment (530m), wharf (100m, 33 berths for small craft), extension of the existing wharfs (2x15m+70m additional wharf, 68 berths for yachts; access road (410m), cycling track (450m), parking lot (470m2), power and water supply, sewerage, lightening, greenery, waste management system, benches. As a result of the project, Kuressaare Yacht Harbour will have the capacity for receiving small craft and increased number of yachts. Conditions for launching regular boat connection between Latvia and Estonia will be created. Achievements: Progress reportCurrent project is a single partner infrastructure development project, targeted at the development of Kuressaare Yacht Harbour with the objective of increasing the capacity of receiving small craft and yachts in order to facilitate maritime toursim in Saaremaa and Latvian coastal areas as well as other Baltic Sea countries. The construction work has been implemented by Veemaailm INC OÜ and construction supervision has been carried out by OÜ Kuressaare Kommunaalprojekt. Following the required preparatory activities, work on site started on 15.06.05. Work was suspended for the winter period (January-March 2006) and continued in March 2006. The work was completed on 30.06.06 in compliance with the project application. The work has been performed at a high quality level, the quality control was secured by the construction supervisor. The project objectives have been attained: the capacity of receiving boats has been raised (from 64 berths before the project to 165 berths after the project) by installing two new wharfs and extending two exisiting wharfs; a precondition for launching a boat connection to Riga and Roja has been created.