EIB to finance construction of Serbian section of natural gas interconnector
The European Investment Bank (EIB) will finance the construction of the Serbian section of a 171 km natural gas interconnection between Serbia and Bulgaria. Loans of 25 million euros from the EIB, the bank of the European Union, will diversify Serbia’s energy supply and strengthen energy networks in South-Eastern Europe. It will also support faster integration of the region into the EU energy market, improve competition and ultimately attract more investment. The EIB loan complements an EU grant of € 49.5 million (from the Instrument for Pre-Accession Assistance – IPA II) for this project, which is on the fourth list of projects of interest common.
“The European Investment Bank supports the energy transition in Serbia and around the world. As part of the EIB energy lending policy agreed in 2019, we have committed to supporting a few gas projects already under appraisal, before moving to exclusively renewable loans at the end of 2021. This is why the EIB is pleased to provide 25 million euros to support the construction of the Serbian side of this interconnector, a priority project for the European Union and the Energy Connectivity Initiative in Central and South-Eastern Europe (CESEC), contributing to a Strong, prosperous and developing Serbia, a goal shared within Team Europe. With this investment, we confirm the importance of supporting the energy transition in Serbia and across the region, ”said Lilyana Pavlova, EIB Vice-President responsible for lending operations in Serbia.
Serbian Deputy Prime Minister and Minister of Energy, Development and Environmental Protection Zorana Mihajlović said:
Serbian Finance Minister Siniša Mali said: “Investments in infrastructure are of great importance for Serbia, especially in the energy sector, as they contribute to the security of gas supply and diversification of supply routes and suppliers. The Serbia-Bulgaria gas interconnection is very important. significant in this context and therefore we express our gratitude to the European Investment Bank for helping us to conclude the financial arrangements of this project today. These types of projects normally contribute to higher economic growth, which is especially important amid the fallout from the coronavirus pandemic. This is why Serbia has provided substantial funds for the budget of public investment, which reached a record high of 7.2% of GDP. “
The Head of the EU Delegation to Serbia, Ambassador Sem Fabrizi, underlined: “This is a big step forward towards the realization of a high priority project, which has several far reaching goals. : increase the diversification and security of energy supply in Serbia; strengthen regional cooperation contribute to balanced socio-economic development and the pursuit of energy transition and a healthier environment. I welcome this project also as as a key element of the strategy of Serbia at large to complete the ongoing liberalization of the gas sector, an important commitment to take Serbia forward in the accession negotiations with the EU ”.
To date, the EIB has invested over € 672 million in the energy sector in the Western Balkans. In combination with EU funds, the EU Bank provides strong and long-term financial support to countries in the region and facilitates the shift to more efficient and diversified energy resources. This project reduces dependence on a supplier and creates a more competitive energy market. The project received technical assistance from Jaspers during the preparation phase, which included reviewing the EU grant application.