The first 5.5 km section of the Niš-Merdare highway was opened today by Republic of Serbia President Aleksandar Vučić and the Ambassador of the European Union to Serbia Emanuele Giaufret, in the presence of representatives of EIB Global, the European Bank for Reconstruction and Development (EBRD) and Serbian ministers. The contract for this first section of the highway was signed in September 2021 during the visit of European Commission President Ursula von der Leyen.
EIB Vice-President Lilyana Pavlova said: “Once completed, the new road will halve travel time between Niš and Merdare while increasing road capacity and safety. As a flagship project under the Economic and Investment Plan, it will provide a faster connection between countries in the region and the European Union, thus contributing to the economic cooperation and development of districts in Southern and Central Serbia.”
The project is expected to cost around €650 million in total. The cost of the 33 km Niš-Pločnik section is estimated at €255 million, partly financed with a grant of over €40 million from the European Union channelled through the Western Balkans Investment Framework. Over €180 million is secured through favourable loans from EIB Global and the EBRD, while the rest will come from the Serbian government. The 40 km Pločnik-Merdare section of the motorway will be constructed in the second phase of the project.
EU Ambassador to Serbia Emanuele Giaufret said: “We want this project to contribute to peace and stability in the region by providing better links between southern Serbia and the Western Balkans road network and enable the free flow of people, goods and capital from Niš, via Pristina to Tirana and Durrës.”
The Niš-Merdare Highway E-80, also known as the “Peace Highway“, forms part of the arterial route linking Bulgaria with the Adriatic Sea towards Albania, and thus has a wider regional dimension.
About the EIB and EIB Global
The EIB is the long-term financing institution of the European Union, owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. The EIB supports projects in four priority areas: infrastructure, innovation, climate and environment, and small and medium-sized enterprises (SMEs). EIB Global is the EIB Group’s specialised arm devoted to increasing the impact of international partnerships and development finance, and a key partner of Global Gateway. We aim to support €100 billion of investment by the end of 2027 — around one-third of the overall target of this EU initiative. Within Team Europe, EIB Global fosters strong, focused partnerships alongside fellow development finance institutions and civil society. EIB Global brings the EIB Group closer to local people, companies and institutions through our offices around the world.
The EIB has been active in Serbia since 1977, providing finance to support key infrastructure projects, small and medium-sized enterprises (SMEs), industry, services and local authorities. Since becoming active in the country, it has provided over €7.2 billion of investments to support SMEs and revitalise transport, education, healthcare and utility infrastructure.
The EIB is continuing to support transport infrastructure in the Western Balkans region by signing a EUR 100m loan to build the new highway linking Niš and Merdare in Serbia. The project concerns the construction of the first 32 km (out of 100 km in total) section – also called the Highway of Peace – connecting Niš, one of the largest cities in Serbia, with Priština. The new road is part of the 314 km-long corridor connecting Southern and Eastern Europe.
Only a month after the first grant was signed, EIB Global signed a second EU grant for €174.6 million for the subsection Paraćin – Trupale – Međurovo rail route, part of an EU financial package totalling €2.2 billion for the Belgrade – Niš section of the Railway Corridor X. The first grant under the Western Balkans Investment Framework (€82.8 million) was signed in February 2023. The funds will enable the upgrade and modernisation of 230 km of railway. This will enable travel speeds of up to 200 km/h between Belgrade and Niš, increase trade flows and stimulate economic growth along the route.
The Belgrade-Niš section of the Railway Corridor X will receive EIB Global’s financing of up to €1.1 billion, of which €550 million has already been signed. All in all, the European Union is providing a €2.2 billion financing package to Serbia to give this important section of railway a much-needed upgrade that will enable travel speeds of up to 200 km/h between Belgrade and Niš. The package consists of EU investment grants of up to €598 million (the largest EU grant for a single project in Serbia to date), a €1.1 billion EIB loan, as well as a loan of €550 million from the European Bank for Reconstruction and Development (EBRD). The European Union has already approved grants worth €265 million, and today marked the signing of the first loan tranche for €82.8 million under the Western Balkans Investment Framework (WBIF).