Serbia Route 7 Highway

Location:

Serbia

Project number:

50086

Business sector:

Transport

Notice type:

State

Environmental category:

A

Approval date:

22 Jul 2020

Status:

Signed

PSD disclosed:

19 Sep 2018

Project Description

Provision of a sovereign loan facility to the Republic of Serbia to finance the construction of a road section to semi-motorway standard, approximately 39.4 km in length between Nis and Plocnik (the "Project"). The Project is part of a longer road section from Nis to Merdare which connects Serbia with Kosovo and further with Port of Durres in Albania. The Project is part of Route 7 of the Western Balkans Core Network.

The Project will be co-financed with a loan from the European Investment Bank (EIB) and an investment grant from the Western Balkans Investment Framework (WBIF). In addition, the WBIF has been providing grant funding for project preparation.

Project Objectives

  1. Support Serbia's economic development and regional integration by improving its connectivity between its main cities and neighbouring Kosovo and through Kosovo with Port of Durres in Albania.
  2. Contribute to improving resilience of the Serbian section of Route 7 to the impacts of climate change through inclusion of structural and non-structural climate change adaptation measures to be incorporated into the design to increase resilience of the investment and contribute to improved management of the impacts of future climate change.

Transition Impact

ETI score: 69

The Project will promote Serbia's internal and regional integration by improving its key transport infrastructure. The Project will also promote inclusion through the introduction of apprenticeships and work-based learning programmes for young engineers/students to be employed during construction either as permanent employees or as interns.

Client Information

SERBIA SOVEREIGN

The Borrower is the Republic of Serbia represented by the Ministry of Finance. The Client and Executing Agency is the Corridors of Serbia (Koridori Srbije) which is responsible for the construction of Serbia's motorway network.

EBRD Finance Summary

EUR 85,000,000.00

A sovereign loan of up to EUR 85 million.

Total Project Cost

EUR 281,500,000.00

The total estimated project cost is approximately EUR 281.5 million.

Environmental and Social Summary

Categorised A (ESP 2014). The Project is expected to significantly reduce travel times, increase level of service and road safety and enhance regional transport activities, both in terms of passenger and freight. The construction works are anticipated to commence in the first half of 2021. The Project will be implemented by Koridori Srbije("Corridors of Serbia" or "KS").

An independent environmental and social consultant reviewed the Environmental and Social Impact Assessment (ESIA) documentation and associated management plans against the Bank's requirements and confirmed that the Project has been structured in accordance with all relevant national, EU and EBRD Performance Requirements.  An ESIA, and supporting documentation including a Stakeholder Engagement Plan, Non-Technical Summary and Resettlement Policy Framework have been prepared by independent consultants working under the Western Balkans Investment Framework. These documents were disclosed on August 8, 2018. The permitting process is ongoing with the application for location conditions having been submitted. All permits will be in place before the launch of the tender for construction works.

Subsequent to Environmental and Social Due Diligence, the Client finished implementation and certification of an ISO 14001 Environmental and Social Management System (ESMS) the Client also has an ISO 45001 certified Health & Safety Management System. In addition, the Client is committed to developing a human resources management system which will apply both to its employees and to contractors and other third parties.

Employment rates for women in Serbia are significantly below the EU-27 average. The Client is committed to conducting an early assessment of available workforce and skills amongst women for all positions needed during the construction and operation of the road in order to prioritise female hiring. The ESIA included focus group discussions with women and further consultation activities with women in the project impact area are planned in the SEP. The Client has committed to implementing a code of conduct for workers covering Gender Based Violence and Harassment (GBVH) as well as training and awareness raising. Additional to the community grievance mechanism, the Client will reinforce the capacity of local law enforcement in order to collaborate in addressing complaints of GBVH.

The Project will be required to implement measures to manage dust and air emissions during the construction phase as well as implement controls and regular monitoring during the operations phase. Mitigation measures to reduce noise impacts include the selection machinery for road construction and the erection of noise barriers during the operations with locations based on the results of noise level analysis. The road crosses a number of water-courses including the River Toplica. Therefore the Project will implement measures to manage water crossings and minimise impacts to watercourses during construction and operations as well as implement a water-quality monitoring program.

The route alignment was optimised through assessment of a number of route variants that were evaluated based a weighted set of metrics including land-take and associated economic and physical displacement. The final alignment will require the permanent acquisition of approximately 400 ha of land, including 72 physical structures of which 60 residential properties are affected in both municipalities Merošina and Prokuplje. A Resettlement Policy Framework has been prepared and disclosed. The Client have hired a consultant to prepare a Resettlement Action Plan with a final plan to be completed by Q3 2020. This plan, developed in consultation with affected people, will include surveys of all affected assets, a socio-economic survey, a detailed implementation plan and budget.

The route will cross the boundary edge of an Important Plant Area (IPA) (Lalinacke slatine) for a length of 600 metres and other natural habitats as identified by the ESIA.  The road design includes a cut and cover tunnel through this area and the ESIA concludes that, with this measure, no likely significant effect will be caused to key values or the integrity of the site. In addition, the Client is committed to conducting pre-construction biodiversity surveys.

A Road Safety Audit was undertaken on the detailed design and mitigation measures agreed. A Stakeholder Engagement Plan (SEP) has been prepared for the project and includes requirements for public engagement during the pre-construction and construction period, including awareness-raising activities with the local communities on community health and safety and the grievance mechanism for the Project.

An Environmental and Social Action Plan (ESAP) has been agreed with the Client and includes requirements to: (i) develop and put in place relevant environmental and social management plans prior to construction; (ii) develop a Resettlement Action Plan (RAP) prior to any expropriations, (iii) undertake additional pre-construction biodiversity surveys in areas of conservation importance to refine proposed mitigation strategies (e.g. near the Lalinacke Slatine Important Plant Area) and (iv) ensure that EBRD requirements are fully embedded in contractor documents.

The Bank will evaluate the Project's environmental and social performance in accordance with the Bank's Performance Requirements through review of reports and monitoring visits.

Technical Cooperation and Grant Financing

The following Technical Co-operation assignments are envisaged as part of the Project:

- Development and implementation of inclusive procurement practices to support the Client and contractors to offer on the job training opportunities to young people during construction;

- Environmental and Social due diligence.

For consultant opportunities for projects financed by technical cooperation funds, visit procurement of consultants.

Company Contact Information

Zoran Babic, Acting Director
zoran.babic@koridorisrbije.rs
+381 11 33 44 174
www.koridorisrbije.rs
Kralja Petra, 21 11000 Belgrade Republic of Serbia

PSD last updated

27 Feb 2020

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP 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 following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.

 

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