New EBRD financing for major motorway in Bosnia-Herzegovina

By Ina Coretchi

The EBRD is increasing its support for the modernisation of the transport infrastructure of Bosnia-Herzegovina with a €21 million loan for the completion of the construction of the Banja Luka – Gradiska motorway.

The motorway from Banja Luka to Gradiska, the first in the Republika Srpska, links the capital Banja Luka with the international transport Corridor X. It is being built with financing from both the EBRD and the European Investment Bank.
The EBRD’s new sovereign loan will be extended to the Republika Srpska Motorways, a newly-established public company responsible for managing the motorway network. The proceeds of the loan will be used to finance the construction of the Mahovljani Interchange, which will complete the missing link on the Banja Luka – Gradiska motorway. The Project will also support a programme of institutional strengthening for this new company.
The project includes the construction of a 1.8 km new two-lane motorway, four interchange two-lane slip roads, with a total length of 6.9 km, two viaducts, which carry two of the slip roads over the new motorway, and four other bridges within the interchange.

In addition to the EBRD loan, the project is co-financed by €5 million in grant funds provided by the European Commission through its pre-accession programme, and €0.5 million from the Central European Initiative and the Western Balkans Investment Framework.

“This investment represents a continuation of the EBRD’s commitment to help Bosnia-Herzegovina modernise its transport network, which is crucial for supporting the economic growth in the region. The project will promote further reform in the infrastructure sector, helping to attract private investors. Upon its completion, the new motorway will considerably reduce the current level of heavy traffic on existing routes,” said Sue Barrett Director for Transport at the EBRD.
“We appreciate the EBRD’s continuous support for the development of transport infrastructure in Bosnia and Herzegovina. This loan is important because it provides the funds required for the completion of Banja Luka - Gradiska motorway,” said Dragan Vrankic, BH Minister of Finance and Treasury.

“This is another in a series of projects resulting from our excellent cooperation with the EBRD. A very important component of the project, in addition to the loan itself, is the support for institutional strengthening of the Republika Srpska Motorways. I would also like to express our special gratitude to the EU Delegation in Sarajevo for the significant grant support to the project,” said Nedeljko Cubrilovic, Republika Srpska Minister of Transport and Communications.

To date the EBRD has invested more than €328 million in the road sector in Bosnia-Herzegovina, with total commitments in the country exceeding €1 billion.

*Western Balkans Investment Framework is a joint grant and lending facility established by the European Commission, the European Investment Bank, the European Bank for Reconstruction and Development, the Council of Europe Development Bank to finance priority projects in the Western Balkans.