Local Roads Reconstruction and Upgrade Project



Project number:


Business sector:


Notice type:


Environmental category:


Approval date:

25 Jun 2013



PSD disclosed:

30 Aug 2012

Translated version of this PSD: Montenegrin

Project Description

The EBRD is considering providing funds to finance the reconstruction of the Lubnice – Jelovica – Jezerine local road, selected as a priority from the local roads network in order to upgrade it to regional road status.

Transition Impact

The proposed Project is expected to result in transition impact in the following areas:

1. Expanding Road Maintenance Market:

  • Adoption of a performance-based maintenance contracting strategy and action plan;
  • Preparation of model performance-based maintenance contracts: to improve cost-effectiveness of maintenance activities through performance measurement of maintenance works on the regional and national roads network.

2. Promoting market functioning and efficiency through a dedicated road safety programme which will include:

  • Amendment of the secondary legislation on road safety and adoption of selective EU Directives on road safety;
  • Completion of a road safety audit on the Project road sections;
  • Adoption of a Road safety strategy and action plan;
  • Completion of a training programme (safety audit, data management, enforcement, etc.);
  • Launching of a nationwide road safety inspection programme.

The Client

Government of Montenegro.

EBRD Finance

Sovereign loan programme of up to EUR 25 million, structured in two loans of EUR 5 million and EUR 20 million, respectively.

Project Cost

EUR 30.2 million.

Environmental Impact

The Project has been categorised B in accordance with EBRD's 2008 Environmental and Social Policy. An initial site visit undertaken by the Bank’s environmental specialist and Environmental and Social Due Diligence (the “ESDD”) carried out by an independent consultant included a review of the existing Project documentation and publicly available information and meetings with design consultants and the Client. The ESDD ascertained that the project involves partial re-alignment and upgrading of 8.5km long section of an existing two-lane road and construction of a new tunnel (approximately 2.5 km in length) and that any adverse environmental and/or social impacts associated with the project are likely to be site-specific and readily identified and mitigated.

The ESDD identified that a part of the existing road section to be upgraded will for a short distance encroach the buffer zone of a protected area, the Biogradska Gora National Park, but showed that impacts on the protected area would be localised and can be mitigated through design and adherence to good international practice in project preparation and construction. ESDD also ascertained that the Project will require limited land acquisition, but that no resettlement is envisaged at this stage.

A comprehensive Environmental and Social Action Plan (the “ESAP”) has been developed for the project to address the ESDD findings to ensure the Project complies with EBRD Performance Requirements. Some elements of the ESAP (mainly related to road safety, environment, health and safety risks management and monitoring during constructions stage) will be also addressed through project supporting TCs. A number of further studies and assessments are required to be undertaken to determine the specific mitigation measures; however, these can be completed only once the detailed design of the proposed tunnel is known. Additional studies will include: baseline habitat, flora and fauna surveys, baseline social surveys, hydrological and hydrogeological studies, livelihood restoration framework, if deemed required biodiversity/flora & fauna management plan, stakeholder engagement plan.

Requirements for development of specific further studies and identification and implementation of detailed environmental and social mitigation measures and management plans satisfactory to the Bank are conditions precedent to disbursement of the Bank’s loan to any construction activity. This section of Project Summary Document will be updated upon completion of the additional studies to summarise the findings and additional mitigation measures.


Technical Cooperation

It is envisaged that technical cooperation support will provide assistance with the following:

1. Assistance with development of a performance based maintenance contracting strategy and preparation of model performance based maintenance contract;
2. Assistance with development of a road safety programme;
3. Assistance with review of the detailed design, tender documentation preparation and tendering process;
4. Road safety audit of the Project road sections.


Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

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