The Government of Serbia has confirmed a Guarantee Agreement with the European Society for Financing Railway Rolling Stock (EUROFIMA), which guarantees a loan of 90 million euros aimed at improving the country’s railway system.
These funds will be utilized by Srbijavoz, the Serbian railway company, to purchase new rolling stock and modernize the existing fleet. The Republic of Serbia will act as the guarantor for the loan repayment, as reported by the business portal eKapija. The loan will be allocated for the purchase of new locomotives (€40 million), modernization of diesel-powered 711 series trains (€25 million), and the refurbishment of Z1-type passenger cars for international travel (€25 million).
The modernization project is set to span from 2024 to 2027.
Apart from upgrading the current rolling stock, Srbijavoz plans to acquire six new, modern locomotives. These locomotives will enhance the efficiency and competitiveness of passenger transportation, especially on routes to Western Europe. This is particularly important following the completion of the Belgrade-Budapest high-speed railway.
The modernization efforts will also include the upgrade of approximately 20 Z1-type passenger cars, allowing for high-speed travel of up to 200 km/h, in line with European standards.
The loan has a maturity period of 10 years, with funds being disbursed in one or more installments. The specific financial terms for each withdrawal will be determined at the time. The loan’s interest rate will be variable, tied to the six-month Euribor, with an additional 60 basis points. The overall financing costs, which include the interest rate, a basic commission of 0.05%, and a capital cost fee of 0.59%, will amount to the six-month Euribor plus 124 basis points.
The financial conditions for the loan may vary based on the timing of the rolling stock’s purchase and modernization, with details to be defined upon the signing of specific contracts.
