€76 million for Montenegro’s railway transformation

01 Jun 2024

Montenegro is set to revitalise its railway system with a significant investment of up to €76 million from the European Union, through EIB (European Investment Bank) Global under the Team Europe initiative. This funding comes through the European Investment Bank (EIB) Global, under the Team Europe initiative. The financial package, signed on 29th May, includes a €40 million loan and €35.5 million in EU grants and technical support. This money will be used to reconstruct the 167 km-long railway line from Bar to Podgorica to Vrbnica. The project aims to make the railway more efficient, safe, and able to handle more passengers and freight, promoting greener transport. By improving this key section of the Trans-European Transport Network (TEN-T), over 1 million passengers and many international freight operations will benefit each year. Financial Breakdown

€40 million EIB loan
€35.5 million in EU grants
€4.5 million contribution from the Government of Montenegro

Project Highlights

Rehabilitation of 20 km of rail
Reconstruction of 13 steel bridges and 8 tunnels
Modernisation of rolling stock workshops in Podgorica, Bar, and Nikšić

The signing ceremony in Podgorica was attended by high-level officials, including EIB Global Director for Enlargement and Neighbourhood Lionel Rapaille, Montenegro’s Finance Minister Novica Vuković, Transport and Maritime Affairs Minister Filip Radulović, and EU Ambassador Oana Cristina Popa. EIB Vice-President Kyriacos Kakouris highlighted the importance of this project for regional integration and sustainable transport: ““The upgrade and extension of rail transport infrastructure is a priority both for the European Union and the Government of Montenegro, as it is crucial for regional integration in the Western Balkans.” Montenegro’s Finance Minister Novica Vuković highlighted the broader economic benefits: ” Our goal, in partnership with the European Investment Bank, is to foster the development of better, more efficient and safer infrastructure. This will ultimately enhance connectivity and accelerate Montenegro’s economic growth.” Transport Minister Filip Radulović pointed out the long-term impact on the transport system: ” Strong support from the European Union and the EIB in financing railway infrastructure improvements means that Montenegro is on track to creating a transport system that will be compatible with the European Union’s transport system and that can continue to be upgraded so that our country is able to comply with EU railway standards.” Ambassador of the European Union to Montenegro Oana Cristina Popa underlined the broader significance of EU support: “This investment is not just about infrastructure; it’s about enhancing the quality of life for Montenegrins, fostering economic prosperity, and ensuring sustainable development.” Background information About the EIB and EIB Global: The EIB is the long-term financing institution of the European Union, owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. The EIB supports projects in four priority areas: infrastructure, innovation, climate and environment, and small and medium-sized enterprises (SMEs). EIB Global is the EIB Group’s specialised arm devoted to increasing the impact of international partnerships and development finance, and a key partner of Global Gateway. We aim to support €100 billion of investment by the end of 2027 — around one-third of the overall target of this EU initiative. Within Team Europe, EIB Global fosters strong, focused partnerships alongside fellow development finance institutions and civil society. EIB Global brings the EIB Group closer to local people, companies and institutions through our offices around the world. About the EIB in Montenegro: The EU bank has been active in Montenegro since 1977 and has provided almost €1.1 billion worth of loans to the country, mostly in support of SMEs, education and transport infrastructure. For more information regarding the EIB’s projects in Montenegro, please refer to: https://www.eib.org/en/projects/regions/enlargement/the-western-balkans/montenegro/index.htm About the EIB in the Western Balkans: The EIB is one of the leading international financiers in the Western Balkans. For detailed information on the EIB’s activities in this region, visit www.eib.org/en/publications/the-eib-in-the-western-balkans.