The Government of Serbia has adopted a draft law confirming a loan agreement with the European Union, securing a loan of up to 1.13 billion euros. This loan has a repayment period of 40 years, with a 10-year grace period, meaning that the repayment of the principal will begin in 2034 and will be paid evenly over the remaining term.
The loan is part of the EU’s Instrument for Reform and Growth for the Western Balkans, a funding initiative totaling 6 billion euros for the region. This includes 2 billion euros in grants and 4 billion euros in “soft loans” (which contain elements of development aid) for the 2024-2027 period. Serbia will have access to 1.59 billion euros, with approximately 1.131 billion euros allocated as loans and 455 million euros as grants.
Serbia’s funding will support both budget support and projects under the Western Balkans Investment Framework (WBIF), with significant portions of the funds earmarked for infrastructure and reform projects. The loan comes with favorable terms, including a 40-year repayment period and a 10-year grace period.
The agreement was signed in Belgrade and Brussels in late November 2024, and the Serbian National Assembly will need to confirm the contract, which will create financial obligations for the country. To access the funds, Serbia must meet specific conditions, including progress in areas like democracy, the rule of law, and human rights, as well as fulfilling the criteria outlined in the Reform Agenda.
