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Upgrading Kosovo’s only international rail link

By Vanora Bennett

Upgrading Kosovo’s only international rail link

EU provides €38.5 million to EBRD-funded rail modernisation project through Western Balkans Investment Framework

Following a senior loan of €39.9 million from the EBRD in 2015 to finance the three-stage modernisation of Kosovo’s railway infrastructure, a grant agreement for a further €38.5 million of co-financing from the European Union through the Western Balkans Investment Framework (WBIF) was signed in Pristina today.

Established in 2009, the WBIF is a joint initiative of the European Commission, international financial institutions such as the EBRD, bilateral donors* and the governments of the Western Balkans. The Framework aims to support development and EU accession through the provision of finance and technical assistance for strategic investments, particularly in transport, energy, environment, social infrastructure (such as schools and community housing), and private sector development.

The grant agreement was signed in the presence of Bedri Hamza, Finance Minister of Kosovo, Christian Danielsson, Director General for Neighbourhood Policy and Enlargement Negotiations in the European Commission, and Charlotte Ruhe, EBRD Managing Director, Central and South-Eastern Europe. The EBRD will be implementing the EU grant.

Minister Hamza said: “We are grateful for the significant contribution the EU is making through the Western Balkans Investment Framework to this crucial project for our country. This is not only important financially but also a signal of the trust, commitment and confidence the EU, the EBRD and our international partners are putting in us. Improving connectivity and augmenting our links with the rest of the world is the way forward for Kosovo.”

The project will improve the connection between Kosovo’s railway network and the wider European network through Pan-European Corridor VIII and Corridor X, running southwards to FYR Macedonia and northwards to the Serbian border. The grant covers the southern section of Kosovo’s rail route 10, linking Fushë Kosovë near the capital Pristina with the border of FYR Macedonia.

The project also includes two other sections, Fushë Kosovë to Mitrovicë and a northern section from Mitrovicë to the Serbian border, also benefiting from EU and WBIF financing.

Director General Danielsson said: "We are with Kosovo in deeds and not only in words. This is why the European Commission, on behalf of the citizens of the EU, has provided this grant to Kosovo through the EBRD so that the people in Kosovo get a significant improvement in the railway connection with their neighbours and the rest of Europe."

The Kosovo rail route 10 project is part of the Western Balkans core railway network, an extension of the Trans-European Transport Networks, which is part of the EU’s wider efforts to promote transport connectivity in the Western Balkans.

“The modernisation of transport infrastructure is one of the EBRD’s key priorities in the Western Balkans, helping to improve trade routes within the region, build well-integrated economies and develop stronger cross-border cooperation as well as improve people’s lives in Kosovo by offering better connectivity with the region and wider Europe,” said the EBRD’s Charlotte Ruhe.

The EBRD’s original loan to Infrastruktura e Hekurudhave të Kosovës (Infrakos), the national railway infrastructure company, provided funding to upgrade the 148 km line. It was the EBRD’s first loan to the transport sector in Kosovo and was co-financed by the European Investment Bank. The project also benefits from technical assistance grants for project preparation and implementation as well as reform measures provided by the EU, WBIF and the EBRD Shareholder Special Fund.

The EBRD is also supporting the improvement of asset management practices, track access charges and equal opportunities, with particular emphasis on workforce diversity and gender equality, in the implementation of the project.

The EBRD began investing in Kosovo in 1999. To date, the Bank has signed 53 projects in the country with a net cumulative business volume of more than €227 million. Kosovo became an EBRD member and country of operations in December 2012.


*Bilateral donors to the WBIF are: Austria, Canada, the Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Luxembourg, the Netherlands, Norway, Poland, the Slovak Republic, Slovenia, Spain, Sweden and the United Kingdom.


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