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Overview

China Eximbank provides $608.3 million preferential buyer’s credit for Fast Road Novi Sad- Ruma (‘Fruškogorski Corridor’) Construction Project

Commitments (Constant USD, 2023)$574,874,257
Commitment Year•2022Country of Activity•SerbiaDirect Recipient Country of Incorporation•SerbiaSector•Transport And StorageFlow Type•Loan

Status

Project lifecycle

Pipeline: Commitment

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
Jan 26, 2022
Start (planned)
May 1, 2021
First repayment (originally scheduled)
May 15, 2027
Last repayment (originally scheduled)
May 15, 2042

Geospatial footprint

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The purpose of the project is to upgrade the 47.7 kilometer Novi Sad-Ruma section of Serbia's IB-21 state road (expressway). The project includes a new bridge over the Danube and the tunnel Iriški venac through Fruška gora, in the length of 3.5 km. The road will connect three municipalities, Novi Sad, Irig and Ruma and is connected with the existing state road – border of Romania, the motorway and the expressway under construction, Ruma – Šabac – Loznica. Vojvodina will be connected with the western and northwestern part of Serbia as well as the regional centers – Novi Sad, Ruma, Šabac and Loznica. It represents an indirect link between Serbia and Bosnia and Herzegovina, Croatia and Romania. It will contribute to the improvement and relief of traffic in urban areas on the bypasses around Novi Sad, Irig and Ruma and, which is especially important, the relocation of transit traffic from the area of the National Park “Fruška gora“ by building the tunnel Iriški venac. More detailed locational information can be found at https://www.openstreetmap.org/relation/14385265, https://www.openstreetmap.org/relation/9273976, and https://www.openstreetmap.org/relation/1633271, https://www.openstreetmap.org/relation/1635716

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Policy Banks

  • Export-Import Bank of China (China Eximbank)

Receiving agencies

Government Agencies

  • Government of Serbia

Implementing agencies

State-owned companies

  • China Road & Bridge Corporation (CRBC)

Loan desecription

China Eximbank provides $608.3 million preferential buyer’s credit for Fast Road Novi Sad- Ruma (‘Fruškogorski Corridor’) Construction Project

Grace period•5 yearsGrant element•46.2598%Interest rate (t₀)•3%Interest type•Fixed Interest RateMaturity•20 years

Narrative

Full Description

Project narrative

On January 24, 2019, China Road and Bridge Corporation submitted an offer proposal for the implementation of the Fast Road Novi Sad-Ruma (‘Fruškogorski Corridor’) Construction Project to the Government of the Republic of Serbia. Then, on September 24, 2019, the Government of the Republic of Serbia, Public Enterprise 'Roads of Serbia' and China Road and Bridge Corporation signed a protocol on cooperation regarding the Fast Road Novi Sad-Ruma (‘Fruškogorski Corridor’) Construction Project. On January 26, 2022, China Eximbank and the Government of the Republic of Serbia signed a $608,384,610 preferential buyer’s credit (PBC) agreement [CHINA EXIMBANK PBC (2021) NO.23 TOTAL NO. (528)] for the Fast Road Novi Sad-Ruma (‘Fruškogorski Corridor’) Construction Project. The loan (PBC) carries the following borrowing terms: a 20-year maturity, a 5-year grace period, a 3% interest rate, a 0% default (penalty) interest rate, a 0.5% ($3,041,923.05) management fee, and a 0.5% commitment fee. The borrower is expected to use the proceeds of the loan (PBC) to finance 85% of the cost of a $715,746,600 commercial contract (number 48-00-7081/2020-3) between the Government of Republic of Serbia’s Ministry of Construction, Transport and Infrastructure, Public Enterprise “Roads of Serbia”, Koridori Srbije d.o.o, and China Road and Bridge Corporation (CRBC), which was signed on October 6, 2020. The lender made disbursements worth $121,677,000 between 2019 and 2022. The loan’s (principal) amount outstanding was $121,677,000 as of September 31, 2022. The purpose of the project is to upgrade the 47.7 kilometer Novi Sad-Ruma section of Serbia's IB-21 state road (expressway). The project includes a new bridge over the Danube and the tunnel Iriški venac through Fruška gora, in the length of 3.5 km. The road will connect three municipalities, Novi Sad, Irig and Ruma and is connected with the existing state road – border of Romania, the motorway and the expressway under construction, Ruma – Šabac – Loznica. Vojvodina will be connected with the western and northwestern part of Serbia as well as the regional centres – Novi Sad, Ruma, Šabac and Loznica. It represents an indirect link between Serbia and Bosnia and Herzegovina, Croatia and Romania. It will contribute to the improvement and relief of traffic in urban areas on the bypasses around Novi Sad, Irig and Ruma and, which is especially important, the relocation of transit traffic from the area of the National Park “Fruška gora“ by building the tunnel Iriški venac. CRBC is the contractor responsible for project implementation. The project was originally scheduled to commence in May 2021.

Staff comments

1. The China Eximbank loan (PBC) agreement can be accessed in its entirety via https://www.dropbox.com/s/7f5wg1mt4hz9yzu/China%20Eximbank%20PBC%20Agreement%20for%20the%20Construction%20of%20the%20Fast%20Road%20Novi%20Sad-%20Ruma%20%28%E2%80%9CFru%C5%A1kogorski%20Corridor%E2%80%9D%29%20Project%20.pdf?dl=0. 2. The Serbian project title is Пројекат изградње брзе саобраћајнице Нови Сад – Рума („Фрушкогорски коридор”). 3. In Serbia, CRBC acts through a local subsidiary known as China Road and Bridge Corporation Serbia Ogranak Beograd-Savski Venac.