The European Investment Bank (EIB), the European Bank for Reconstruction and Development (EBRD) and the World Bank (the International Bank for Reconstruction and Development/ IBRD) signed last week in Belgrade with the Serbian Ministry of Finance three loan agreements totaling EUR 273.8 million aimed at supporting the rehabilitation and safety of a part of the Serbian national road network.
The project will support the rehabilitation and safety of about 1,100 km of major roads throughout Serbia over the next five years. The total cost is estimated at EUR 390 million, of which EUR 367 mil. for rehabilitation works and EUR 23 mil. for services including detailed design, institutional strengthening and technical assistance. The Project supports the implementation of the first phase of the Government’s National Road Network Rehabilitation Program.
The investments will be carried out by the Public Enterprise Roads of Serbia and will be financed jointly by the EIB with a EUR 100 mil. loan, the EBRD with a EUR 100 mil. loan, and the World Bank with a EUR 73.8 mil. loan; the balance of the investment cost (EUR 116.2 mil.) will be provided by the Government of Serbia.
The project is expected to improve the condition and safety of the National Road Network. It will also:
- promote regional and national economic growth, facilitate trade, support private sector development and, in general, contribute to economic and social cohesion in the region;
- serve international, inter-city and local traffic demand;
- have overall positive environmental and social impacts as it will improve access to markets and social services and also provide opportunities for temporary employment for local communities through civil works contractors.
The EIB is the long-term lending institution of the European Union owned by its Member States. The EIB has been active in the Western Balkans since 1977. Over the past ten years, it has provided finance totaling over 7 billion EUR. Since 2001, the EIB has extended about EUR 4 billion in favor of projects in Serbia, of which EUR 1.5 billion were signed in the transport sector.
To date, the EBRD has invested EUR 3.3 billion in 167 projects in Serbia, 40 per cent of which were in the infrastructure sector, including investments in the transport industry. The EBRD, set up in 1991, is owned by 64 countries and two intergovernmental institutions and supports the development of market economies and democracies in its countries of operations.
The World Bank provided knowledge and financed 39 projects in Serbia since 2001 with almost US$ 2 billion, including budget support. The current portfolio consists of 12 investment projects under implementation worth around US$ 845 million.