The European Investment Bank provided a EUR 86 million loan to Bosnia and Herzegovina to rehabilitate and modernize both the North-South and the East-West railway routes.
The 20-years loan, carrying a 5-years grace period and representing some 50% of the total finance, will contribute to overhaul the track, rehabilitate and reconstruct bridges, tunnels, and stations. Furthermore, the signaling systems, the electrification and the telecommunications will be updated so as to enhance safety and increase the speed on these key lines.
In total some 172 km will be upgraded, of which 102 km of the Pan-European Transport Corridor V branch C (Ploce - Sarajevo - Osijek - Budapest), specifically the sections Konjic-Mostar-Capljina, and additional 70 km of the parallel to Corridor X, between Josavka and Kostajnica. The project includes the preparation of detailed design studies, construction works supervision, management consulting activities and, if needed, land acquisition.
The design work is to start in 2006, while the construction works are planned for the period 2008-2011. The project, which is co-financed with the EBRD and the European Commission, will help to redevelop the existing heavy industry by making available efficient and environmental-friendlier transport of heavy goods between national industrial centers, and across borders for export.
This is the fifth loan provided by the EIB to Bosnia and Herzegovina since 1995. The previous loans totaled EUR 224 million for roads, energy and for the railway network. Future projects will concern additional improvements to road transportation and the energy sector.