€25 million loan to help airport meet growing traffic
The EBRD is supporting the modernisation of Sarajevo International Airport with a €25 million loan to expand the airport’s infrastructure and help it address capacity constraints. The loan is extended directly to Sarajevo International Airport and is guaranteed by the state of Bosnia and Herzegovina.
Sarajevo International Airport is the main gateway to Bosnia and Herzegovina, handling the majority of the international traffic flow. In recent years passenger traffic at the airport has increased significantly and continues to grow despite the economic downturn.
The EBRD loan will be used to finance the expansion of the passenger terminal, to build a new rapid runway and to expand the aircraft parking apron. The project will add close to 7,000 square meters to the current area of the passenger terminal of 10,000 square meters.
The expansion is supported by grant financing from the Dutch government, the Western Balkans Fund and EBRD Shareholder Special Fund of nearly €1 million. The grants will be used for tasks including preparation of the final design of the expanded passenger terminal and updating the corporate plan outlining the airport’s future strategy.
The project will support greater commercialisation of the airport’s activities and will facilitate implementation of the EU’s Single European Sky initiative in Bosnia and Herzegovina, which involves gradual liberalisation of air traffic.
“We are pleased to support the expansion of the main airport in Bosnia and Herzegovina at a time when investment sources remain scarce. The upgrade of Sarajevo International Airport will improve the quality of air traffic movement stimulating further growth in passenger flow,” said Sue Barrett, Director of the EBRD Transport Team.
Dragan Vrankic, Minister of Finance and Treasury of Bosnia and Herzegovina, added: “I am glad that this project relies primarily on the creditworthiness of the company for repayment of the loan. The project will also help us to test the new legal structure for financing of public utilities whereby, through direct loan agreement with international financial institutions, the utilities assume much more accountability and responsibility for all aspects of project implementation.”
“This project is a result of the long-standing co-operation between the EBRD and Sarajevo International Airport. In addition to solving the airport's needs in light of the future growth, the expanded terminal building will provide much higher quality of services to the passengers, while improving the image of the country by offering it a modern gateway”, said Bakir Karahasanovic, General Manager of Sarajevo International Airport.
Since the beginning of its activities in Bosnia and Herzegovina, the EBRD has committed over €1 billion to the country’s economy, of which over a third has been in the infrastructure sector.