The European Investment Bank (EIB) has launched a programme for 2009 in Serbia aimed at combating the financial crisis and bringing the country closer to the European Union. The Bank has also signed signed a new Framework Agreement with the Republic of Serbia aimed at laying down the EIB activity in the country. A first loan of 250 M€ for small and medium-sized enterprises (SMEs) and priority projects in the country, via the National Bank of Serbia, was signed in Belgrade on May 11th, as the first in a series of operations that are expected to see the EIB support Serbia’s real economy in 2009-2010.

The 250 M€ loan signed between the European Investment Bank (EIB) and the Republic of Serbia, will be disbursed via the National Bank of Serbia and will be on-lent by Serbian commercial banks.

During the current financial downturn, the amounts made available by the EIB will help to fund and support projects by SMEs and local authorities as well investments in the following sectors: industry, infrastructure, energy, environmental protection, knowledge economy, health, education, and services.

EIB loans are available to all financial institutions in Serbia and, in order to accelerate support to the SME sector, they may cover up to 100% of the cost of each project.

As EIB Vice-President Scannapieco highlighted “the EIB has been active in Serbia for many years; however, with the agreements signed today, cooperation between the Bank of European integration and the Serbian government has taken a huge step forward”.

EIB's commitment in Serbia throughout 2009 and in the years to come will fund investments and thus the development of businesses and local authorities as well as the completion of key infrastructure that will connect Serbia with the rest of Europe. EIB’s key contribution will therefore help Serbia to combat the recession and make a swifter recovery, thereby adding greater weight each day to that country’s plans of nurturing closer ties with the European Union.

EIB and Serbia’s economy

Serbia’s projects currently being appraised by the EIB exceed EUR 1.4bn. Since the EIB finances up to 50% of the total project cost, over the next few years investments totalling at least EUR 2.8bn could be made thanks to EIB support. This corresponds to around 3% of Serbia’s entire GDP.

This is unparalleled and matches total EIB signatures in Serbia over the past eight years. During the period 2001-2008, total financing was EUR 1.38bn (see attachment).

The projects concern all sectors of the economy from the financial sector, motorways and rails (Corridor X) to education, energy, research and development and local infrastructure.