Parliament approves Serbia taking out almost a billion dollars worth of loans

Since the new Serbian parliament was convened, the state has borrowed about one billion euros on the basis of loans and credits, and on the basis of the pending laws, the debt would reach almost two billion.

Economic experts say that most of this money is earmarked for infrastructure spending, which is a good thing, but point out that the biggest problem with large borrowing is that if the projects, for which money has been borrowed, are not realized, the state will then have to pay penalties.

Shortly after last year’s elections and the convocation of the new parliament, MPs started to adopt laws confirming Serbia’s new loans. In the period from October last year to date, they have approved over 940 million euros worth of loans.

Most of the money, however, went to infrastructure projects and curbing the consequences of the pandemic. For example, EUR 200 million was borrowed for water supply and sewage treatment plants and EUR 85 million for the construction of the Niš-Merdare motorway section. A total of EUR 200 million was spent on alleviating the consequences of the pandemic.

The state has also taken out a loan for energy efficiency and overhaul of the district heating systems. There is also a suspended loan of almost 800 million euros waiting to be spent.

The largest part of this amount, EUR 431,685,000, will go to the construction of the infrastructure on the E-761 motorway, the so-called Moravian corridor, i.e. the Pojate-Preljina section.

There is also a pending loan agreement between the French Development Agency and Serbia for the EUR  50 million to be given under the auspices of the Urban Climate Resilience Programme. This project will also be co-financed by the IBRD through a loan of EUR 82,600,000. This is just one in a series of loans.

(Nova, 06.07.2021)


This post is also available in: Italiano

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