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EBRD, EIB announce crediting several projects in Serbia

Belgrade/London, 22 May 2006

Serbian Minister of Finance Mladjan Dinkic said that the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB) announced at the EBRD Annual Meeting in London that they will provide loans for several infrastructural projects in Serbia to the amount of several hundred million euros.

Mladjan Dinkic

Dinkic told Beta that priority was given to road and rail infrastructure and added that European financial institutions expressed interest in developing the private and financial sector in Serbia.

A total of €140 million will be secured for the rail network, Dinkic said noting that of that sum, EBRD will provide €60 million while EIB will secure €80 million. EIB’s Board of Directors already approved this investment and the project could be signed as soon as June, Dinkic said.

Dinkic said that EBRD is interested in becoming a small shareholder in insurance firm Dunav Osiguranje as well as in the recapitalisation of Cacanska Banka, after it successfully took part in the recapitalisation of Komercijalna Banka.

According to Dinkic, the Serbian government delegation discussed construction of Belgrade ring road with representatives of EIB and EBRD as these two financial institutions are expected to invest €60 million each in the first phase while the Serbian government would invest €30 million from the national investment plan.

Dinkic announced that an EIB delegation will come to Belgrade on June 2 to discuss the financing of reconstruction works on health centres in Serbia. A €100 million investment was set aside for this purpose and an assessment of the project can be expected by end-June, he said and added that EIB has already invested €50 million in the reconstruction of regional hospitals in Serbia.

Dinkic said that a €3 million loan, representing the first tranche of the total EIB approved credit of €25 million for constructing 10 schools in Serbia, will be withdrawn in three weeks.

The EIB wants to invest an additional €100 million to make the Danube suitable for navigation, Dinkic said noting that €30 million will be used to construct a lock, another €30 million to clear up the river banks and €40 million to clear up the riverbed. The EIB has also shown interest in building protective dikes against floods, he added.

The Serbian government's delegation had a very important meeting with EBRD President Jean Lemierre concerning the continuation of financing projects in Serbia, said Dinkic and announced that the results of economic reforms and investment opportunities in Serbia will be presented at a seminar organised by the world's leading investment bank JPMorgan.

In a statement to the Tanjug news agency, Serbian Minister of International Economic Relations Milan Parivodic said that at this years EBRD's annual meeting there is considerable interest in Serbia's investment atmosphere, implementation of macroeconomic reforms and political situation.

We are satisfied with the interest shown for our delegation, stressed Parivodic adding that the Serbian delegation took part in the EBRD business forum and met with representatives of the JPMorgan investment bank.

More than 2,000 participants took place in the EBRD annual meeting this year, among whom are investors, bankers, finance ministers, central bank governors and representatives of international financial institutions.