Banking practices indicate that autumn is a peak time for borrowing, as expenses from school preparations and winter heating add pressure to wallets emptied by summer vacations. While the average citizen in Serbia carefully considers loans, the government appears to be borrowing without hesitation. In just two months of autumn, Serbia has increased its debt by hundreds of millions of euros, with a billion euros expected in total.
The Serbian Parliament has received a bill to confirm new borrowing of 178 million euros for a credit arrangement involving the State of Serbia, Deutsche Bank and Sinosure, the agent for constructing the Belgrade Metro. This loan, signed on September 20, 2024, will benefit JKP Belgrade Metro and Train, with a repayment period of 13 years, including a 5.5-year grace period. The interest rate is variable, based on the six-month EURIBOR plus a fixed margin of 1.65 percent per year.
Minister of Construction, Transport and Infrastructure Goran Vesić also signed a contract for 138 million euros to build the railway station complex in New Belgrade, with reconstruction efforts potentially financed by a Chinese loan, as many railway projects in Serbia are backed by agreements with China and Russia.
In September alone, Serbia borrowed 300 million euros through three bills. The first proposal involves loans from Deutsche Bank and Societe Generale for up to 200 million euros, designated for ongoing budgetary and operational needs. Additionally, the government secured 70.7 million euros from the International Bank for Reconstruction and Development for a project aimed at preventing non-communicable diseases and addressing mental health challenges.
Looking ahead, the announcement of a significant loan for solar power plants suggests a potential borrowing of around 1.5 billion dollars. This project, involving a consortium led by Hyundai Engineering, aims to build solar facilities capable of generating 1 gigawatt of electricity, along with a 200-megawatt battery storage system.
Critics, including economist Dušan Nikezić, warn that this project lacks transparency, as it may not have undergone a competitive bidding process and could result in inflated costs. He highlights that Serbia might borrow heavily to pay an unknown American company more than market rates for solar capacity construction. The Ministry of Mining and Energy stated that the project will be financed through long-term favorable investment loans, with ownership of the power plant resting with Elektroprivreda Srbije (EPS).
