Serbia plans to borrow 70 million euros from OTP Bank for the reconstruction and modernization of the Subotica-Horgos border railway with Hungary (Szeged).
The loan is approved for a period of 84 months (seven years), it is written in the Draft Law on Borrowing of the Republic of Serbia with OTP Bank for the needs of financing the reconstruction and modernization of this railway, and it is transmitted by Nova ekonomija.
The agreement obliges Serbia to pay interest at the calculated nominal interest rate formed by applying the reference interest rate of six-month EURIBOR, increased by a fixed margin of 1.85 percent per year.
The installment / interest payment date is April 15 and October 15 each year. The loan funds can be withdrawn within 18 months after the entry into force of the loan agreement.
The project of reconstruction and modernization of the railway Subotica – Horgos border with Hungary (Szeged) has been declared a project of special importance for Serbia.
The commercial contract, which was signed on June 12, 2021, envisages the agreed value of the project up to 90 million euros. The project is financed partly from the budget of Serbia, and partly from a loan between the lender and Serbia.
The loan agreement envisages the amount of 70 million euros in dinars, while the state, as the financier of the project, will make an advance payment in the amount of 20 percent of the accepted agreed amount.
The explanation of the law also states that the project of reconstruction of the railway Szeged – Reska – Horgos – Subotica – Baja is of exceptional importance for Serbia and Hungary.
On the territory of Serbia, there are two sections, Subotica – Horgos – state border (Reske) in the length of 26.63 km and the section Subotica – state border (Chikeria) in the length of 11.90 kilometers, Nova Ekonomija reports.
