The European Investment Bank (EIB) is lending EUR 34 million to Serbia and Montenegro Air Traffic Services Agency Ltd. for the rehabilitation of the air traffic control infrastructure of Serbia and Montenegro.

A major part of the investment will be in the Area Control Center) of the flight information region Belgrade. In Montenegro's capital Podgorica, a modern approach control centre and control tower will be set up. In addition, communication, navigation and surveillance radar systems will be renewed in various locations. The project is expected to be completed by the end of 2009.

With the funds stemming from the EIB some 31%of the total project cost (about EUR 111m) is financed. The term of the loan is 15 years, with a grace period of 4 years. The project also benefits from a loan provided by the EBRD.

With this new loan included, up to now the EIB has signed loan contracts totalling EUR 813 million for projects located in Serbia and Montenegro. The finance provided supports projects in: transportation, water management, energy, urban infrastructure, health, education and SMEs. In the future, the EIB aims at underpinning transport infrastructure, water management, health and SMEs.

The EIB was set up in 1958 under the Treaty of Rome to provide loan finance for capital investment furthering European Union policy objectives, in particular regional development, Trans-European Networks of transport, telecommunications and energy, research, development and innovation, environment improvement and protection, health and education. Outside the Union, the EIB contributes to European development co-operation policy in accordance with the terms and conditions laid down in the various agreements linking the Union to some 130 countries in Central, South and Eastern Europe, the Mediterranean region, Africa, the Caribbean and the Pacific, Asia and Latin America.