The European Bank for Reconstruction and Development (EBRD) provided strong support to the Serbian economy in 2020 with new record investments worth 679 million euros, addressing the urgent needs of the economy and creating the foundations for a strong, sustainable and inclusive recovery.
576 million euros was placed with the private sector and small businesses, through direct financing or through financial institutions.
Through a program to recover from the crisis caused by the Covid-19 virus (“Resilience Framework”) in 2020, the EBRD, through an emergency procedure, placed 145 million euros to commercial banks to maintain the liquidity of the economy and small and medium enterprises. The program will be active in 2021 if banks need additional liquidity to support the economy.
The rest of the funding was related to programs that support women’s entrepreneurship, investment in competitiveness, mortgage loans for households, programs to support investments in energy efficiency, as well as a program to support trade flows of the economy. In addition to the credit lines, the beneficiaries had the opportunity to receive incentive grants and free technical assistance financed by the European Union and other donors after the successful implementation of the project.
To build better infrastructure links in the country and the region, the bank has secured a 85 million euro loan to build the Nis-Plocnik section of the Peace Highway, which will connect Serbia with Kosovo and further with the key Albanian port of Durres, improving connectivity and facilitating trade.
In addition to road infrastructure, the Bank also supported Serbia to improve its digital infrastructure and finance a project to build an optical broadband network in rural areas, giving over 600 schools in villages access to the Internet. The project will help improve the quality of education in less developed regions.
Good progress has also been made in supporting the Serbian government in reforming state-owned enterprises. With the help of the EBRD, the government has created a strategy for the management of state-owned public enterprises, which defines the reasons for state ownership and guidelines for the operation and better corporate governance in state-owned enterprises.
Current and completed projects in 2020
Despite the pandemic, construction of a new landfill and energy production plant in Vinca began last year and is progressing well. This significant project, supported by the EBRD with a syndicated loan of 128 million euros, is one of the largest public-private partnerships in Serbia to date and brings private financing and expertise to the public sector project. The new landfill will be in line with EU standards with modern waste management technology.
Subotica has completed the modernization of water and wastewater infrastructure, a decade-long engineering endeavor supported by the EBRD, the European Union and bilateral donors under the Western Balkans Investment Framework (WBIF). The new network, which includes a water factory and wastewater treatment plant, is improving the quality of water supply, wastewater disposal and treatment services in Subotica.
Priorities for 2021
In 2021, the Bank’s priorities in Serbia will remain to help the economy recover from the effects of the Covid-19 pandemic and to promote green and sustainable growth while investing in energy efficiency and renewable energy sources.
The EBRD will also continue to work with commercial banks to improve access to finance for Serbian small businesses. Special focus will be given to young entrepreneurs with a new program supported by Sweden, combining EBRD loans and donor concession finance for better access to finance and advice for young entrepreneurs.
To support the development of the country’s green economy, together with municipal and state institutions in Serbia, the EBRD will continue to work on identifying projects that will support energy efficiency improvements in public and residential buildings.
The Bank is also researching with municipalities the use of renewable energy (solar and geothermal) for district heating and cooling systems.
The European Bank for Reconstruction and Development (EBRD) responded to the coronavirus pandemic with a record investment of 11 billion euros in 2020 through 411 projects, addressing the urgent needs of the 38 economies in which it invests, BiF reports.
