The construction of Corridor Vc, a key infrastructure project in Bosnia and Herzegovina that the European Bank for Reconstruction and Development (EBRD) supports, is progressing with new financing from the EBRD, European Union (EU) and local commercial banks.
The EBRD has committed a loan of EUR 110 million, alongside a EUR 150 million EU investment grant and up to EUR 150 million from local commercial banks, to finance the construction of the Mostar north-south section and so support the country’s infrastructure, local businesses and services for citizens.
The loan agreement was signed today in Sarajevo by Srđan Amidžić, Minister of Finance and Treasury of Bosnia and Herzegovina, and Manuela Naessl, EBRD Head of Bosnia and Herzegovina, with the announcement that an additional EUR 110 million of EBRD financing will be available for the corridor. With this funding, the EBRD’s total contribution to the Corridor Vc project exceeds EUR 1 billion, with a further EUR 870 million provided in investment grants from the EU.
The section in question will be connected to other sections between southern Mostar and the Croatian border, which have now all secured financing, with construction work either completed, in progress or at the tendering stage. Once these sections are complete, the motorway from Mostar to Croatia will be fully functional.
“These are extremely significant projects for all citizens of Republika Srpska and the Federation of Bosnia and Herzegovina,” said Srđan Amidžić. The Minister also expressed gratitude for the excellent cooperation with the EBRD and EU, and highlighted the importance of the flow of people and goods.
Manuela Naessl said: “We are pleased to extend this additional financing for the Corridor Vc project and with it provide new momentum for the completion of the whole corridor. This key infrastructure project will lead to significant everyday benefits for people and businesses across the country, reducing travel times and facilitating trade with key export markets. The government has also taken an important step in mobilising commercial co-finance, which is required to close the financing for this priority infrastructure project, and together with the EU and the European Investment Bank (EIB), we continue discussions with the authorities to make progress on all sections.”
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The EU is the EBRD’s strategic partner in the development of Corridor Vc. The EU investment grant of EUR 150 million is being channelled through the Western Balkans Investment Framework (WBIF) and is expected to be signed in the coming months.
Adebayo Babajide, Deputy Head of the EU Delegation to Bosnia and Herzegovina, said: “The construction of this particular section will undoubtedly yield numerous benefits for local communities, such as shortened travel times, enhanced road safety and reduced transit through Mostar. The financial support by the EU, EBRD and EIB underscores our commitment to fast track the completion of Corridor Vc, which will encourage long-term economic recovery, sustainable jobs and economic integration in the region. To that end, the EU has committed EUR 870 million in grants to facilitate its completion.”
Denis Lasić, Acting Director of JP Autoceste FBiH, highlighted the company’s satisfaction with and gratitude for the cooperation with the EBRD and the EU, and the support received so far: “Autoceste FBiH is the largest beneficiary of EU grants in Bosnia and Herzegovina, which confirms that our projects are well prepared. The agreement we are signing today will secure important new kilometres of Corridor Vc in Bosnia and Herzegovina. The construction of the Mostar north-south section will mean that the motorway through Herzegovina, from northern Mostar to the Bijača border crossing, is fully functional.”
The Management Board of JP Autoceste FBiH is preparing to start the construction of the motorway from the northern Mostar interchange to Buna next year, which will result in nearly 30 km of new motorway through Herzegovina.
The project will include the construction of a northern interchange and a 15 km-long dual-carriage motorway section. This will help to ease traffic congestion around the city of Mostar.
For the first time, commercial banks are co-financing a section of this vital transport artery. This is immensely important given the large infrastructure needs in the country and the need to enhance connectivity and transport links to neighbouring countries.
The development of Corridor Vc is a strategic priority for Bosnia and Herzegovina. The 325 km motorway will cross the country from the border with Croatia, near the port of Ploče in the south to the northern border, and continue to Budapest, Zagreb and Belgrade. It is currently the biggest construction project in the country.
Investing in infrastructure is one of the EBRD’s priorities in Bosnia and Herzegovina. Since it began operating in the country in 1996, the Bank has invested more than EUR 3 billion through 218 projects, of which EUR 1 billion are in the Corridor Vc project.
Source: EBRD
