The EBRD is lending €100million to the Serbian state-owned railway company Zeleznice Srbije (Serbian Railways) to finance the purchase of rolling stock. This will help the process of restructuring of the company and improve the quality of service and the competitiveness of the Serbian rail sector.
This project builds on the Bank’s efforts to improve the transport infrastructure in Serbia.
The EBRD will finance a fleet of new passenger trains. The new trains will replace the ageing passenger fleet and improve service frequency and quality.
In parallel with the EBRD, the European Investment Bank (EIB) will finance complementary investment focussing on a programme of track renewal of the core network. This will include upgrading of Corridor X, the main rail track running from Croatia to Hungary and its connection to Montenegro, and the line connecting the Serbian capital Belgrade with the port of Bar in Montenegro.
This investment will help improve the overall performance of the passenger business, increasing passenger numbers. At the same time, this project contributes to the Bank’s focus on the restructuring of the Serbian rail sector, which will ultimately deliver the wider benefits of enhanced competition and private sector participation.
Thomas Maier, EBRD Business Group Director for Infrastructure, said that “the EBRD is committed to helping Serbian Railways improve the standards of transport infrastructure. Like the wider Serbian economy, the rail sector is experiencing the effects of the global economic recession and the Bank sees it as vital to provide long-term funding to Serbian Railways to help weather the crisis. Continued investments to boost the company’s operating performance will aid the process of restructuring of the rail sector in Serbia and promote the overall economic growth of Serbia”.
This latest loan builds on the close cooperation between the EBRD and Serbian Railways. In 2001, the Bank provided a loan in support of the refurbishment of electric locomotives and initiated a railway restructuring programme. These objectives were continued with the second loan of €60 million in 2006 for the purchase of 750 freight wagons as part of the major programme of restructuring. Both projects included parallel financing with the EIB.
The EBRD is the largest investor in Serbia, having committed more than €1billion in 83 projects to date.