The three organizations are providing a €2.2bn financing package to Serbia for a much-needed upgrade of the strategic rail link, which forms part of the Pan-European Corridor X railway axis. The package includes a €550m EBRD loan, the largest EBRD loan to Serbia to date. It also includes a €1.1bn loan from the EIB, and an investment grant of around €598m from the EU, the largest EU grant for a single project in Serbia to date.
The EU has already approved €265m worth of grants and the first tranche, amounting to €82.8m, was signed at an event held earlier this week on a symbolic train ride from Belgrade’s main train station to Ripanj.
It is hoped that overall the investment will help promote a modal shift from cars to trains, a greener and safer mode of transport.
The proceeds will finance substantial modernization of the 230km railway section connecting Belgrade to Niš, including the construction of new bridges and tunnels. The upgrade will enable travel speeds of up to 200km per hour and decrease total travel time between Belgrade and Niš from the current six hours to one hour and 40 minutes.
The improved rail link will also support Serbia's economic development, contribute to its local and regional connectivity and integration, and enhance the competitiveness of rail transport, especially for international and transit freight traffic.
The President of the Republic of Serbia, Aleksandar Vučić said, “When [the project is complete], Niš will be an hour and 40 minutes away from Belgrade, and right now you cannot get there by car in less than two and a half hours. When the railway was built in 1884, it took eight hours to travel, now it takes six and a half. Nothing has changed in 130 years. Now we are changing Serbia, with the help of the European Union."
The EBRD has been one of the main financiers of Serbia’s rail sector, with more than €1bn invested to date and ambitious plans to extend this support in future.
Railway Corridor X is one of the pan-European corridors connecting central Europe with Thessaloniki in Greece. It is part of the EU’s Economic and Investment Plan for the Western Balkans. The plan is aimed at mobilizing investments totaling up to €30bn in the areas of transport, energy, and green and digital transition, to create sustainable growth and jobs.