The improvement of railway infrastructure conditions, the integration in the European network, the stimulation of traffic capacity and services increase are the main reasons for which Serbia upgrades the pan-European Corridor X. The Corridor is the backbone of the Serbian railway network (Salzburg – Ljubljana – Zagreb -) Sid – Belgrade – Nis – Presevo (- Skopje – Veles – Thessaloniki), with branch from Subotica to the Hungarian border (Corridor Xb).
At present, there are temporary speed restrictions on the corridor caused by the poor infrastructure conditions which reduce traffic flows. But this year, Serbia announced the launch of modernisation works on several sections of Corridor X.
According to the General Manager of Serbian Railways (ZS), Dragoljub Simonovic, 300 km of railway will be reconstructed on this corridor by 2016. The Government has set aside 15% of the necessary funds and has transferred RSD 9 Million (EUR 78,000) to the railway company.
To complete works, Serbia and RZD International have signed a contract on the financing and modernisation of six rail sections part of Corridor X. The total length of sections is 112 km, for which the Russian side has allocated a financing of USD 89.9 Million. The six line sections (Ruma – Golubinci – 17.9 km, Sopot Kosmajski – Kovačevac – 18.4 km, Mala Krsna – Velika Plana – 29.5 km, Vinarc-Đorđev -15 km, Vranje Spa – Ristovac -17.7 km and Bujanovac Bukarevac – 13.8 km) require infrastructure modernisation works and new signalling and communications systems.
Moreover, ZS has submitted all necessary documents for the works in plan to contract an EBRD credit. EUR 25 Million have been allocated for the acquisition of rails, sleepers, infrastructure equipment and other materials.
The reconstruction and modernisation of these sections on Corridor X are part of the 5 projects for the modernisation of Serbia’s railway infrastructure to be financed from the credit granted by the Russian company worth USD 800 Million. Currently, Serbia is carrying out works to Belgrade – Pancevo railway also financed through the Russian loan.
“At the middle of 2014, works on two sections will be initiated (…) and until 2015 works to all sections in plan will be launched. At the same time, we are negotiating a contract for the acquisition of new diesel multiple-units worth USD 100 Million and projects on the modernisation of Novi Sad – Stara Pazova railway and part of Belgrade – Bar railway”, declared Dragoljub Simonović, the head of Zeleznice Srbije.
Shortly after signing the financing contract with Russia (March), ZS has selected a consortium (including Serbian companies Gosa FOM and Mostogradnja) to take over the contract (attributed to other company which went bankrupt during the development of works) on works on Novi Zeleznicki Most Bridge on Gilje – Paracin railway, part of Corridor X. The cost of works to be developed and completed by the end of September is under EUR 2.5 Million.
Foreign companies, interested in the projects
“As the modernisation of railway infrastructure is one of the priorities of the Serbian Government (according to the declarations of Prime Minister Ivica Dacic), Serbia is interested to get credits to modernise the main railways. To that end, the Railway Company is interested to access a loan which could be allocated by China and worth around EUR 400 Million.
The sum could be allocated for the construction of railway infrastructure and will be paid through the freight exports from Serbia to China, the central press informs, quoting the declaration of the company’s general manager, Dragoljub Simonovic. Also, during a meeting between the Serbian side and a delegation of China Machinery Engineering Corporation (CMEC), Simonovic said that the loan could be concluded before the official visit of the Chinese President to Serbia, announced for September 2014.
“Funds will be used for the reconstruction and electrification of Lapovo – Kraljevo, Mala Krsna – Pozarevac – Zajecar – Prahovo Port and Mala Krsna – Smederevo railways. Also, part of the amount could be directed to the construction of a terminal on Corridor X (Novi Sad – Belgrade – Nis)”, added the head of the company.
According to the Serbian press, the officials of the Chinese company CMEC support this initiative, including the loan reimbursement method, and they will sign a memorandum.
The CMEC director for Serbian operations Li Xueqiang said that the loan negotiations had been initiated since 2011 and that the payment method, through the exports of Serbian products to China, had been one of the project’s conditions.
During another meeting between Simonovic and China Civil Engineering Construction Corporation (CCECC), the parties have discussed the project on the modernisation of Novi Sad – Subotica railway, to Budapest, using funds allocated by the Chinese side worth EUR 870 Million.
China is not the only country interested in involving in the railway infrastructure modernisation projects of Serbia. Germany, through DB International GmbH, could participate in the implementation of projects. To that end, the company set up a work team which began activity in April being interested in the maintenance and repair projects of the Serbian railway infrastructure, projects also financed through the Russian loan (USD 800 Million). According to the press, RZD International and DB International GmbH have signed an agreement on delivery of consultancy services as part of the project for the modernisation of the railway network in Serbia. The loan will finance 5 projects and Serbia will allocated 15% of the costs of projects, the total necessary sum amounting to USD 941 Million.
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