RAILWAYS RECOVERY PROJECT

Location:

Bosnia and Herzegovina

Project number:

10224

Business sector:

Transport

Notice type:

Public

Environmental category:

B

Target board date:

15 May 2001

Status:

Completed

PSD disclosed:

10 Jan 2001

Project Description
The EBRD is proposing to finance priority rehabilitation work on the country’s main railway network, along the north-south (Pan European Corridor V).
The main purpose of the project is to: (a) repair and renew the most serious infrastructure damage and deficiencies to allow basic functioning of the key railway corridors;(b) assist with labour restructuring and (c) help strengthen the institutional structures in the railway sector.
 
Transition Impact
The project is expected to make an impact on the transition process by:
  • Financing of labour severance payments promotion of a Labour Restructuring Plan;
  • supporting the Public Railway Corporation as the key project and implementation entity;
  • encouraging the amalgamation of the ZBH and ZHB;
  • requiring the railway companies to establish business planning capability and business plans based on realistic forecasts and capital resource constraints;
  • promoting international trade and regional integration through its focus on the Pan European corridors.
The Client
The clients are the three operating companies in Bosnia and Herzegovina (BiH): Railways of Bosnia and Herzegovina (ZBH), Railways of Herzeg-Bosnia (ZHB) and the Republic of Sprska Railways (ZRS). The first two are being considered for a merger. The executing agency will be the Public Railway Corporation.
EBRD Finance
EUR21 million sovereign loan to the State of BiH, which would be on-lent to the two entities (comprising the Republika Sprska and the Federation of Bosnia and Herzegovina) and on to the three publicly owned railway companies ZBH, ZHB and ZRS
 
The project would be co-financed with the European Investment Bank (EUR31 million) and grants from Japan EUR2.0 million, Canada EUR1.7 million, and USTDA (United States Trade and Development Agency) EUR0.7million
Project Cost
The total project cost is EUR56.4 million.
Environmental Impact
This project was screened in category B/0 requiring the preparation of an Environmental Analysis. The Analysis was prepared by independent consultants and submitted to the bank and the sponsor for review. The analysis concluded and there would be no significant environmental impacts associated with the Bank's Investment. Care will nonetheless be taken to ensure that the procurement of goods and services will be in compliance with EU and national environmental requirements and that suppliers will exercise an acceptable level of environmental performance throughout their activities.
 
Technical Cooperation
TC funding has been secured from USTDA and CIDA (Canadian International Development Agency) for:
  • assistance with tendering and project implementation;
  • assistance with the preparation of business plans and accounts prepared according to international accounting standards.
 

Business opportunities

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