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Zorana Mihajlović, Serbian Deputy Prime Minister and Minister of Construction, Transport & Infrastructure

Striding Towards Realising Our Vision

We have succeeded in changing the picture of infrastructure in the minds of citizens, who can today rest assured that Serbia can complete the largest and most complex projects. With such a foundation, we are this year embarking on a new investment cycle, which will help us move closer to our vision of Serbia becoming a transport hub in this part of Europe in all modes of transport

Serbia has exerted a lot of effort in order to connect with the region and Europe, perhaps like never previously, but there is still work to be done. The formation and work of the Permanent Secretariat of the Southeast European Transport Community represent a new incentive on that road, both for Serbia and the region, says Serbian Deputy Prime Minister and Minister of Construction, Transport and Infrastructure Zorana Mihajlović PhD.

What does the launch of the work of the Secretariat mean for Serbia and the region?

– The fact that the headquarters of the Transport Community is in Belgrade is not significant just because it is the first European and international organisation to be headquartered in Serbia. It is significant because the entire region of the Western Balkans region will have – here in Serbia, in Belgrade – an organisation that deals with precisely what we’re striving to achieve: to be the transport hub of this part of the region, in the road, rail, water and air transport.

Serbia is already that hub geographically and – by investing in all types of infrastructure – it is becoming a hub, in reality, day by day. Initiatives will be launched from Belgrade, plans will be made, works will be negotiated on everything that concerns transport in the region, and transport is the lifeblood of the economies of our countries…We are also gladdened by the fact that all countries of the Western Balkans agreed and unanimously decided for the headquarters to be in Serbia. They all supported Belgrade, and that is great recognition for us, for everything we’ve done in this area.

But we’re now awaited by great works, by a big job to connect our entire region even faster and more securely, because transport can’t wait; people, ideas and goods can’t wait.

To what extent can it be stated today that Serbia is well connected to Europe when it comes to rail and water transport routes?

– Serbia has exerted a lot of effort to connect with the region and with Europe, perhaps like never before, but there is still work to be done. We’ve completed the most important road connection with Europe and Asia – Corridor 10, and by year’s end, we will make the complete branch of the highway to Bulgaria operational. We have more than 100km of highway from Obrenovac to Čačak, and in December – with the completion of the section from Surčin to Obrenovac – we will bring the Miloš the Great Highway five minutes from Belgrade.

We are now launching a new investment cycle worth close to 10 billion euros. We’ve started construction of the Belgrade-Sarajevo highway, as well as the continuation of “Miloš the Great” from Preljina to Požega. Construction is starting on the highway from Niš to Merdar and the highway and high-speed road link Ruma-Šabac-Loznica, while we are working on the Belgrade Bypass and should soon sign a contract for the construction of the Moravian Corridor from Čačak to Kruševac… Likewise, we’ll also prepare project documentation for the Šumadijan Corridor, or the Vožd Karađorđe Highway.

Investing in infrastructure was set as one of the the priorities of the Government back in 2014, and today we see dozens of factories that have opened along newly constructed sections of the highway along Corridor 10

Over the next two years we will complete another 500 km of renewed rail tracks for speeds exceeding 100km per hour, while we will invest about 400 million euros in water transport and, in addition to Belgrade and Niš, we have opened another international airport in Kraljevo…

And all of this is excellent and significant for Serbia. But the countries of the region – together with the EU – have to do much more to remove non-physical barriers at the borders, because it isn’t enough for us to build all the new roads, railways, ports and airports if trucks and people are waiting for hours and hours at borders. We have one border crossing with Macedonia and that is a good way, but with EU member states we have a problem, and that’s what I insist on in every conversation with European officials and fellow ministers from the region.

I also expect the Transport Community to help when it comes to solving this problem in the interests of all because the fast and safe transportation of goods and services is a precondition for economic development.

You’ve said that 2019 is a key year for infrastructure in Serbia. How satisfied are you with the realisation of the goals set to date?

– This year is indeed a watershed year for infrastructure in Serbia, because – as I said – we are this year completing construction of Corridor 10, the largest project in the last 30 years. We have already built around 300 kilometres of highways, thanks to which transit transports have returned to Serbia, so this year we will have about 58 million vehicles on our highways, compared to 37 million vehicles in 2014.

We also have behind us more than 500 kilometres of reconstructed national and regional railway lines, procurements of new passenger trains and locomotives for freight trains, completion of the Žezelj Bridge, the launch of construction of the first high-speed railway in the region, a concession for Nikola Tesla Airport, investments in airports in Niš and Kraljevo, new factories for water, a state-of-the-art system for issuing building permits electronically etc.

And that’s just part of what’s been done. Apart from the things that have been constructed that are visible, a lot has also changed in the way projects are managed and investments are planned, and in the way public enterprises function. And there’s no more going back to the old way, to works that start without project documentation being prepared and expropriation completed; to underdeveloped and forgotten railways; to unreformed rail enterprises and road maintenance contracts from 20 years or more ago.

Finally, we’ve succeeded in changing the picture of infrastructure in the minds of citizens, who can today take pride in the new highways that they drive on, and new trains, and can have faith that Serbia is capable of completing the largest and most complex projects, such as the highway through Grdelica Gorge.

With such a foundation, we are this year embarking on a new investment cycle that will help us connect with the region even better, not only with highways, but also with rail and water transport routes, because our vision is to make Serbia a transport hub of this part of Europe in all forms of transport, which it deserves on the basis of its geographical position.

What does the construction of road corridors mean for Serbia in terms of advancing economic growth and connecting with the European market?

– Infrastructure is a prerequisite for development because where there is no infrastructure there is no opportunity for connection, nor for the arrival of investors, and thus not for faster economic growth. Investing in infrastructure was set as one of the the priorities of the Government back in 2014, and we see the results of that commitment in dozens of factories that have opened along newly constructed sections of the highway along Corridor 10, as well as an increase in the number of vehicles passing through Serbia, from 37 million vehicles to a total of around 58 million that we expect by the end of this year.

This is why we’re not satisfied with completing – after 30 years – the construction of the road route of Corridor 10, but rather we’re launching the construction of new highways, continuing the modernisation of railways and also investing in water transport and aviation, because we want Serbia to be connected with all of its neighbours, but also with the European Union, because we can only develop faster if we’re connected.

To what extent are investments in production operations linked to the revitalisation of the rail transport network and what are your Ministry’s most important plans?

– Modernisation of the railway is as important to us as the construction of highways, and testifying that this is really the case is the more than 500 kilometres of renewed railway lines and the 48 new, modern trains that run on Serbian tracks today. Serbia is today part of China’s global “One Belt, One Road” initiative; we’re building a high-speed rail link from Belgrade to Budapest, renewing the railway line to Bar [Montenegro] with Russian Railways, and preparing to continue the modernisation of Corridor 10, for which we have signed a memorandum with Chinese partners.

According to one World Bank study, Serbia missed out on about 40 years of railway development, and we are today battling to make up for that lost time as quickly as possible

Something like that was unthinkable just a few years ago because many years passed without a single kilometre of tracks being reconstructed. According to one World Bank study, Serbia missed out on 2.5 investment cycles for railways or about 40 years of development, and we are today battling to make up for that lost time.

Today, alongside investments in Corridor 10 and the reconstruction of the Bar railway, we are now also investing in regional rail lines, and by the end of next year, we will have reconstructed a total of around 800 kilometres of regional rail lines. The modernisation of rail tracks is also important for our citizens, who will again be able to ride on the railways, but also for the possibility of significantly increasing the volume of freight transported by rail, which is our strategic goal and an area in which Serbia has huge potential.

Cooperation with the EU relates to the applying of technical standards, interoperability, safety, the management of traffic, public procurement and environmental protection. How much are we progressing in these areas?

– The Ministry of Construction, Transport and Infrastructure manages the work of the Negotiation Group for chapters 14 – Transport Policy and 21 – Trans-European Networks, and participates in the work of seven other negotiation groups.

Let me remind your readers that the last annual progress report of the European Commission rated the transport policy as one of the areas in which Serbia already has a good level of harmonisation with the EU, and the most progress since the previous report has been achieved in the reform of railways. Serbia adopted new laws on railways, safety in rail transport and the interoperability of the rail system in 2018, with which we achieved a high level of harmonisation with EU regulations in establishing a single European railway area.

In road transport, in the previous period, we amended the Law on Traffic Safety, through which a large number of provisions of EU regulations were incorporated. Moreover, through the so-called Berlin Process, which includes the Western Balkan Six and the EC, it can bee seen that Serbia is far ahead of others in the region when it comes to this area.

The area of environmental protection is the subject of the Negotiation Group for Chapter 27 – Environment, which is led by the Ministry of Environmental Protection, while the Ministry of Construction, Transport and Infrastructure, apart from monitoring and contributing to this process, also strives to respect all environmental standards in preparing and implementing all transport infrastructure projects that we are realising.

How successful is Serbia when it comes to securing the funds necessary to carry out all of these tasks? How much does it rely on EU funds and how much on other donors and lenders?

– Serbia is today a country with stable public finances and a stable budget that has enough money to plan development projects, to guarantee them and implement them. The projects we are implementing in the area of infrastructure are funded from a variety of sources, including the national budget, EU grants, credits from European and other international banks, as well as loans from bilateral partners.

For example, the construction of Corridor 10 is being financed mainly through loans from the EIB, EBRD and World Bank, while contractors and banks from the People’s Republic of China and Azerbaijan are present on the Corridor, because at the time when we contracted these projects European banks weren’t interested in this corridor, which is extremely important for the citizens of Serbia – as can best be seen in the fact that nearly 300,000 vehicles have passed the toll booths of this highway since tolls began being charged.

During the period ahead, we want to see more public-private partnerships in infrastructure projects, like the one we already have with Belgrade Airport, and for that, it’s important that we also have financially stable, reformed and efficient public enterprises. 

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