The European Bank for Reconstruction and Development (EBRD) is providing a €5 million loan to support improvements to road infrastructure in Montenegro, in a project that underscores the Bank’s commitment to economic development in the country, and to regional integration.
The sovereign loan is part of a total financing package of €25 million for the benefit of the Ministry of Transport and Maritime Affairs of Montenegro.
On 28 June the EBRD and Montenegro’s Ministry of Finance signed the first loan agreement under the facility, in the amount of €5 million. This loan will be used for the reconstruction of a section of the Berane-Kolasin road in the northern part of Montenegro, between Lubnice and Jelovica, with a total length of approximately 10 kilometres.
A second loan, expected to be signed in 2014, will be used to finance the construction of a section of road between Jelovica and Jezerine, with a total length of approximately four kilometres, including a 2.5 kilometre-long road tunnel.
The EBRD investment is complemented by €1 million in technical assistance grants to support project implementation and institutional strengthening in the transport sector in Montenegro, and to support the road maintenance and safety programmes in the country.
Sir Suma Chakrabarti, the President of the EBRD, said: “The project will facilitate regional economic development throughout Montenegro by improving the access that remote areas have to larger markets, which will also increase the attractiveness of these areas to potential investors. In addition, the improvement in road quality will result in a significant increase in road safety.”
Radoje Zugic, Montenegro’s Minister of Finance, said: “The Government has shown its commitment to the modernisation and improvement of the road network in Montenegro. This investment will significantly shorten the connection between Berane and Kolasin, open up Bjelasica Mountain for development and improve the living conditions of the people in that part of the country.”
Since the beginning of its operations in Montenegro the EBRD has committed over €380 million in 36 projects, generating more than €800 million of investment in the country.