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EBRD lends Belgrade €70 million to build bridge
1st long-term finance syndication gives city access to international markets
Serbia’s capital city, Belgrade, will use a €70 million EBRD loan to build a
bridge that will link the city’s old and new districts, significantly reducing
traffic congestion and pollution levels. The Bank is syndicating €20 million
to international banks, including Hypo-Alpe-Adria International AG, Dexia
Kommunalkredit Bank AG and Niederösterreichische Landesbank-Hypothekenbank AG,
giving Belgrade its first long-term investment syndication and first access to
international capital markets. The full amount will be provided for a period
of 15 years.
Belgrade has only two functioning road bridges connecting the old and new
parts of the city. This makes parts of the city difficult to access and has
resulted in traffic congestion, and noise and air pollution, which are the
city’s most pressing problems. The EBRD investment will help address these
problems by funding a new cable-stayed bridge with a maximum length of 380
metres.
Henry Russell, EBRD Deputy Director for Municipal and Environmental
Infrastructure, said the EBRD investment is a key part of Belgrade’s strategy
to improve traffic flow, cut pollution and address a long-standing problem in
the city. In addition, the syndication portion of the deal is bringing
Belgrade back into the focus of international capital markets, the first time
in its recent history, and also introducing the private sector into public
sector projects.
The recent loan builds on cooperation between the EBRD and the City of
Belgrade, which to date has benefited from €60 million in Bank loans.
Infrastructure development is the most important task for all local
authorities since it improves living standards for citizens and creates new
possibilities for investments, said Nenad Bogdanovic, Mayor of the City of
Belgrade. In last six years over €1 billion has been invested in Belgrade in
infrastructure development, and this latest investment for the new bridge
builds on that success. The City of Belgrade received significant support in
this task from the EBRD, said Mr Bogdanovic.
The EBRD is the largest investor in Serbia, having committed over €900 million
in 62 projects. Dragica Pilipovic, the Bank’s Director for Serbia and
Montenegro, said the new bridge will have a very positive impact in the city.
Commuting times will be cut, and pollution levels will fall too, she added.
The Canadian government has provided €400,000 in technical co-operation funds
for a Lender’s Technical Monitor to advise the Bank on preparation and
implementation.
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