EIB approves €66 million loan for reconstruction of Gazela and 100 bridges in Serbia

Representatives of the Serbian government and the European Investment Bank (EIB) signed today loan agreements for the projects „Reconstruction of Gazela bridge“ and „Rehabilitation of roads and bridges“ in Serbia, worth €33 million each. The agreements were signed by director of the public road company „Putevi Srbije“ Branko Jocic and EIB representative Peter Covelier, and the guarantee for timely payment of the loan on behalf of the Serbian government was signed by Minister of Finance Mirko Cvetkovic.

Cvetkovic explained that the total value of reconstruction works on Gazela is €77 million, which apart from the EIB loan, were provided by Putevi Srbije (€4.8 million), the City of Belgrade (€7.5 million), the European Agency for Reconstruction (€6.75 million) and the European Bank for Reconstruction and Development (€25 million). According to him, the EIB loan for Gazela will be distributed in eight tranches at the most, in the amount of at least €4 million, while all tranches should be used by March 31, 2010.

The Minister said that the loan will be approved for the grace period of five years, the repayment period is 20 years, while the interest will be from 4.5% to 4.7%. Reconstruction works on Gazela should begin in October and last 18 months.

The Director of Putevi Srbije said that due to reconstruction of Gazela, construction of a ring road around Belgrade will be accelerated and added that €50 million will be set aside from the National Investment Plan by the end of the year for the section to Orlovaca.
He stressed that before works on reconstruction of the bridge start, people who live underneath the Gazela bridge will have to be relocated and noted that the contractor should be chosen by the end of August as the pre-qualification tender has already been completed.

Covelier recalled that since 2001 EIB invested €1.13 billion in Serbia, mostly in infrastructure projects.
He also noted that Serbia, thanks to its geographic position, is an important country for transit of goods and passengers in Europe and added that a well-developed infrastructure network can substantially contribute to the country’s integration in the EU.
According to him, EIB plans to continue to finance the Serbian road network and is also interested in energy and education sectors.

Head of EAR in Serbia Daniel Giuglaris announced that this agency is ready to allocate €2 million for displacing Roma families as soon as city authorities come up with an efficient plan for that project.