Project number:


Business sector:


Notice type:


Environmental category:


Approval date:

27 Jun 2005



PSD disclosed:

13 Nov 2004

Project Description

The proposed project entails:
(a) Rehabilitation of tunnel portals, construction of a climbing lane and stabilisation of slopes on Mioska-Kolasin road.
(b) Rehabilitation and construction of a third lane on Cetinje-Budva road.
The project will be implemented by the Ministry of Maritime Affairs and Transport of Montenegro. The objectives of this project comprise: financing of these important regional road links, support for the implementation of the new Roads Law which will unify the currently divided responsibilities for execution of the roads programme, a programme of institutional strengthening to the newly created Roads Directorate and increased revenues to the road sector.

Transition Impact

The project will facilitate transition in the following ways:
Improving transport sector regulation: new law on roads 
The Bank has encouraged approval by the National Assembly of a new Law on Roads which provides for the creation of a single Road Directorate, reporting to the Ministry of Maritime Affairs and Transport for the administration and management of state roads.  
Improving road sector financing: funding and expenditure levels for road maintenance 
Montenegro is currently allocating insufficient funds for the maintenance and renewal of state roads. The project will covenant minimum annual levels of maintenance expenditure with the aim to reach an optimum level by 2008. 
Institutional strengthening 
The Bank is working closely with the European Union’s European Agency for Reconstruction (EAR) and the authorities of Montenegro on an institutional strengthening programme for the road sector. The objectives of this are:
  • Support the new road administration, and assist in developing its administrative, management, financial, planning and procurement functions;
  • Update information on road financing and recommend how best to provide an adequate and stable flow of funds to the sector;
  • Make recommendations for increased competition for road maintenance;
  • Assist in the development of a medium-term (5 years) roads plan.

The Client

The Client will be the Government of Montenegro. The implementing agency will be the newly created Road Directorate, reporting to the Ministry of Maritime Affairs and Transport. 

EBRD Finance

€ 11.5 million, Sovereign Loan to Serbia and Montenegro.

Project Cost

€ 14.7 million.

Environmental Impact

Environmental classification and rationale 
Environmental impacts associated with the rehabilitation of two sections (18 km and 3 km) of an existing 2 lane transit road and the construction of a third, climbing/passing lane for a part of a 3 km section can be readily identified and assessed in an Environmental Analysis. Preliminary due diligence confirmed that the project will not have significant environmental impacts and will bring about some safety benefits. Any adverse impacts can be efficiently mitigated through project design, planning and work practices. For the above reasons, the EBRD has classified the project B/1.
Information reviewed 
In accordance with the EBRD Environmental Policy, environmental investigations have been undertaken to assess the current environmental status of the sites and the environmental impacts of the project. A preliminary study on the existing environmental conditions and the environmental impacts of the proposed rehabilitation was carried out by independent consultants. The study was undertaken in accordance with Montenegrin Environmental Law. It builds on the extensive quantity of reports and local information made available to the consultants. Detailed design of the whole scheme has been completed and this provided the basis for the preliminary study. 
Significant environmental impacts 
The investigations showed that the most significant impact of the project is the improvement of road safety. All other impacts are likely to be minor and they can be readily prevented or mitigated.
The project will improve the safety and appearance of the 10 tunnels, 5 Grade III slopes, 3 bridges and the road surface. The road rehabilitation will also introduce drainage system that will direct rainwater to flow under the road, as opposed to over the road as presently happens.
Traffic densities will not change significantly as a result of the proposed work. There will, however, be a reduction of traffic accidents, obstructions and delays, and this will reduce air pollution from cars and lorries sitting with their engines idling while waiting to pass obstructions. Due to the limited speeds (maximum 60km/hr) as well as very sparse natural and human habitation, noise is not considered to be a significant issue.
There are no areas of ecological importance or endangered species near the road. Therefore, impacts on flora and fauna are likely to be negligible.
No significant adverse social impacts are anticipated. The road sections to be rehabilitated pass through very sparsely inhabited areas and there are no identified, valuable cultural or historical sites in their vicinity.
The key issue during the rehabilitation works is the management of the excavated material, including the old pavement surface. The tender documents will require the road Contractor(s) to prepare a waste disposal plan so as to cater for the safe control and handling of waste, especially excavated material. 
Proposed mitigation measures 
An Environmental Management Plan (EMP) will be prepared in order to define the environmental measures and procedures that will need to be adopted for the scheme and to identify those responsible for their implementation. The EMP will define the timing, frequency, duration and cost of mitigation measures and integrate these actions within the overall project work plan. The EMP may need to be revised during the course of the project, or alternatively be prepared when the design of the project is completed and the Contractor(s)’ working methods are known and agreed.
The main focus is on the management of excavated material, including the old pavement surface. Though each road passes through a relatively inhospitable area it is important that run-off from the excavated material will not contaminate streams when it rains. The tender documents will thus include recommended sites for the disposal of excavated material and suggestions on managing the run-off. The Contractor will be required to state his understanding of the design recommendations, requirements for disposal of excavated material, and his willingness to comply with good environmental practice. This will also show how reusable materials, if any, will be recycled.
During detailed design, a Pollution Incident Plan will be prepared to provide guidance on response to emergency situations, such as accidental spillage of oil, fuel or hazardous materials as the result of a collision.
Part of the EMP will be an Environmental Monitoring Plan, which will set out a programme for monitoring environmental impacts and the implementation of mitigation measures during the construction phase.
Disclosure of Information and Public Consultation 
Environmental information on the project has been released in accordance with Montenegrin law and EBRD’s public disclosure procedures for B-category projects. An announcement concerning the “Environmental Review Summary” was published in a Montenegrin national newspaper on 21st February 2005. This summary has been translated in local language and made available for public review near the project sites and at the office of the Directorate for Public Roads of Montenegro. The Directorate will complete the permitting process and disclosure of information on the project in accordance with the Montenegrin Environmental Law, including that the Environmental Impact Study will be made available for public review and comments.
Supervision and Reporting 
The Client will report to EBRD annually on the measured environmental impacts and on the implementation of the EMP. The Bank will evaluate the project's compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing these reports. EBRD environmental specialist may conduct monitoring visits to the site when and if deemed appropriate. In addition, independent environmental monitoring audits may be carried out. 

Business opportunities

For business opportunities or procurement, contact the client company.

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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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