Skopje Urban Transport Project


FYR Macedonia

Project number:


Business sector:

Municipal and environmental infrastructure

Notice type:


Environmental category:


Approval date:

12 Jul 2011



PSD disclosed:

11 Apr 2011

Translated version of this PSD: Macedonian

Project Description

The EBRD is considering making an investment to enhance the mobility of Skopje’s residents and improve road safety through the implementation of an automated traffic management system throughout the City centre, coupled with the reconstruction of one of the City’s principal traffic corridors, Prvomajska Street, to ease congestion in Skopje.

Transition Impact

Transition Impact of the project steams from:

  • Decentralisation through sub-sovereign lending: This will be a very first project in the municipal sector in FYR of Macedonia funded on the non-sovereign basis which will support a promotion of a decentralised solution and local governance capacity building;
  • Output-based out-sourcing better value for money will be achieved by the design and introduction of on-going maintenance contracting in the traffic management area;
  • Performance-based contracting: The new Traffic Management Unit will be incorporated into the Public Enterprise for Roads and Streets Company, in order to enhance management accountability for the operations of the new traffic management system.
  • Standard Setting with best-practice road safety: By adapting the City’s current designs to achieve a higher level of safety. In order to solidify this new approach toward greater road safety in Skopje, a twinning TC with a partner city within the EU will be carried out.

The Client

City of Skopje

EBRD Finance

The EBRD is considering providing up to €5.6 million to the City of Skopje for the City’s key investments needed to improve the functioning of the urban road system in the City of Skopje including:

(i) traffic management and
(ii) rehabilitation of Privomajska Street.

Project Cost

The total project cost is €7.89 million including related technical cooperation funds.

Environmental Impact

Categorised B in accordance with the EBRD's 2008 Environmental and Social Policy. An environmental and social (E&S) due diligence for the project is currently ongoing and includes the environmental and social analysis of the proposed investment and a review of environmental, social, health and safety polices and procedures and the capacity of the municipality to manage environmental, social, health and safety risks associated with the proposed Project in line with EBRD’s Performance Requirements (PRs).

The investigations to date have shown that the Project will provide environmental and social benefits related to reduction of congestion and air emissions, as well as improvements in road and pedestrian safety in the City of Skopje.

The implementation of the Project will be associated with the creation of some temporary construction related jobs as well as permanent jobs in the new traffic management centre. No significant E&S management issues have been identified in relation to the Borrower. The City is willing to improve its E&S capacity and implement the necessary management systems in line with international standards, including achieving certification by the end of 2012.

The proposed investment is associated with the potentially significant social impacts resulting from the land acquisition required for the Project that affects about 30 kiosks informally established on public land but whose activity has been permitted by the Municipality. In addition, there is a possibility that from two to three residential structures could be affected due to the anticipated road widening along the rehabilitated sections of Prvomajska Street, although upon realising this possibility the Municipality of Skopje has resumed work on fine tuning the alignment and marginally reducing the width of the Right-of-Way to avoid such physical displacement.

A Resettlement Framework is in the process of being finalised. It establishes processes and procedures that the Borrower will have to follow to ensure compliance with the EBRD’s PRs in respect of mitigating the impacts of land acquisition. While the Municipality is committed to relocate the operators of commercial kiosks in a reasonably conducive location, these efforts have only partially materialised to date. The Bank will require the Municipality to prepare a Resettlement Action Plan, including the necessary stakeholder consultation, as a condition precedent to effectiveness of the loan.

The construction works may be associated with moderate impacts related to increased noise, dust and vibration levels and disposal of waste as well as disruption of access for residents and businesses.

Potential E&S impacts of the project will be additionally mitigated by the implementation of the Environmental and Social Action Plan (ESAP), including a monitoring plan, and a Stakeholder Engagement Plan (SEP). These documents will be finalised and agreed with the Borrower for implementation during the Project.

This PSD will be updated when the due diligence is completed.

Technical Cooperation

The following technical co-operation funds are envisaged as part of this project:


  • Urban Road Safety, Traffic Management and Engineering Technical Review. €59,275 funded by the EBRD Shareholder Special Fund.
  • Skopje Urban Transport - Urban Road Safety - ESDD. € 12,920 funded from the Bank’s own resources;


  • Twinning Partnership for Traffic Management and Urban Road Management. €350,000, funded by the Government of Austria;
  • Project Implementation Support. € 410,000, funded by the Government of Austria.

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168

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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