Serbia and China sign Belgrade – Budapest loan agreement

Serbian Transport Ministry has announced that the loan agreement with Exim Bank of China for the modernisation and construction of the railway line linking Belgrade and Budapest was signed. The official ceremony took place in the presence of Serbian Prime Minister Aleksandar Vučić and his Chinese counterpart, Li Keqiang.
The loan will cover the modernisation and the construction of the double-track on Belgrade-Stara Pazova rail section, with a value of USD 297.6 million. The loan was approved for 20 years with a grace period of 5 years. This will be the first line in Serbia that will allow trains to run at speeds of 200 km/h. The works on this section, as part of Belgrade-Budapest main line, will be launched this year.
“For Serbia, the high-speed rail from Belgrade to Budapest is the most important project of the Chinese project as part of China’s initiative One Belt, One Road. The section has a great importance for us as it will be the main rail link allowing fast transport passenger and freight services to the European countries. It will connect Belgrade to Vienna and other European important cities,” Serbian Minister of Transport Zorana Mihajlović said at the signing ceremony.
During One Belt, One Road forum Hungarian Prime Minister Viktor Orbán held talks with the Chinese head of state, the Premier, and investors, and in the course of these meetings important agreements were concluded primarily of an economic and financial nature.  Orbán said that the “most spectacular” of these agreements is the modernisation of the Budapest-Belgrade railway line, and the financial conditions of which were also discussed. “This means that the public procurement tenders can soon be made public and construction work on the project can begin. In addition an agreement was concluded on China Exim Bank and the Hungarian Development Bank mobilising Chinese capital to assist Hungarian small and medium-sized enterprises and Chinese enterprises investing in Hungary,” the Hungarian Government says in a statement.
The Belgrade-Budapest railway project is valuated at USD 2.89 billion and involves the development of 370 km line, including works for the construction, extension and modernisation (of the existing sections). 335 km of railways will require conversion and electrification works and 166 km of railway will be modernised on Hungary’s territory.
In February 2017, Serbian Transport Minister announced that this in May, RZD International should launch the construction of a second track on the Stara Pazova-Novi Sad section of the planned Belgrade-Budapest railway line. The Serbian government signed a USD 338 million deal for the preparation of project documentation and reconstruction of the Stara Pazova-Novi Sad section in July 2016.
The Belgrade-Budapest railway project is implemented into three phases. The technical documentation for Stara Pazova-Novi Sad section (the middle section) is financed by the Russian loan. The preliminary design for the span from Belgrade to Stara Pazova is completed, and the main design and the detailed design are currently being prepared.

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