World Bank approves EUR124.9m loan for reforms in Serbia

The World Bank (WB)’s Board of Executive Directors on Wednesday approved two loans to a total of EUR124.9m (USD138.9m equivalent) to finance reforms in state-owned enterprises (SOEs) and the construction of Corridor X Highway, according to a press release. The first one, in the amount of EUR 89.8mn, aims to reduce the role of the state in managing commercial enterprises and thus create a better environment for private sector investments. It is also expected to enhance the performance, governance and accountability of SOEs and mitigate the short term social and labor impacts of the SOE restructuring and disposition plans. The IBRD Development Policy Loan will have maturity of 14.5 years with grace period of 14.5 years. This is the second such loan extended by the WB to Serbia. WB Country Manager for Serbia Tony Verheijen underlined that continuing the resolution of commercial SOEs remains a critical factor for the success of the government’s economic program and improved economic efficiency.

The second program to the tune of EUR35m will improve regional connectivity and mobility through construction of the missing links of the Pan-European Corridor X highway. The objective of the project is to increase transport efficiency and improve traffic safety on three sections of Corridor X as well as to improve road management and road safety. The IBRD loan will have maturity of 15 years with five years grace period.

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