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Transport infrastructure

The globalization of the world economy puts an emphasis on the critical role of infrastructure in the sustainable economic growth and the competitiveness of an economy. It is clear that continual investment into infrastructure projects is one of the prerequisites for economic growth, and it has multiple effect on the development of the economy, often generating new demand for products and services of local industry. In many countries in transition, the awareness of the infrastructure relevance is a guiding force in the promotion of large investment projects. Economic crisis occurring as a consequence of the transformation of these economies from centralized and planned economies into market ones reduced the government capacity to generate funds for the implementation of new infrastructure programmes, even the maintenance of the existing ones in good condition.

State of construction of highway section in FRY

Economic development trends in our country and the adopted Land Use Plan of the Republic of Serbia require serious actions with regard to transport infrastructure development. Namely, in the territory of FR Yugoslavia there is about 2.750 km of the European (E) road network, accounting for 43% of the total length of our major roads. To provide quality, safe and fast traffic, it will be necessary to undertake actions, to build up the capacity of the present road network and construct new highways.

At present, the Government of the Republic of Serbia gives priority to road infrastructure development bearing in mind the following:

• The advantages of the road corridors through FR Yugoslavia which reflect the fact that the country is a bridge in the overall European transport system and the shortest natural link between the countries in the South East Europe and the Middle East;
• Anticipated increase in the road transport demand in Europe and the fact that investments into highway construction give optimum benefits.

In the sector of transport infrastructure, pursuant to the Concession Law, there is a possibility for granting concessions for the construction of highways, railway lines and other railway facilities as well as for facilities in air transport, according to the B.O.T. system of project financing.

With a view to the above, the following road routes (Fig.1) where these will be a need for highway construction can be completed through the B.O.T. concessions:

E-75 Border with Hungary(Horgos)-Subotica-Novi Sad-Belgrade

The route: border with Hungary(Horgos)-Subotica-Novi Sad-Belgrade and Belgrade-Nis (the existing highway), a leg of the European Corridor 10, connects Salzburg-Ljubljana-Zagreb-Belgrade-Nis-Skopje-Thessaloniki and is the most important road communication in FR Yugoslavia, both for the national traffic flows and for international traffic.

The total length of the highway route from Hungary to Belgrade is 187 km. The Government of the Republic of Serbia financed the construction of a semi-highway (one carriageway) and all necessary interchanges and flyovers for a full highway profile. For the construction of the second carriageway that will provide a full highway profile, the detailed design is available and the land acquisition procedure has been performed.

E-75 Nis - border with the Republic of Macedonia

An international bidding is in progress to grant concession for financing, designing, constructing, operating and maintaining this route in the total length of 141 km. The bidding was announced by the Agency for Investment into Activities of Concern to the Republic of Serbia on behalf of the Government of the Republic of Serbia.

E-80 Nis - Border with the Republic of Bulgaria

The route Nis - Border with Bulgaria in the total length of 107 km is a leg of the European Corridor 10 connecting Salzburg - Ljubljana-Zagreb-Belgrde-Nis-Skopje-Thessaloniki and is a relevant and frequented route of outstanding transit character and a major share of foreign motorists (about 60%).

In December 1998 the government of the Republic of Serbia issued a Decree on granting a concession for financing designing, constructing and maintaining the highway from Nis to the border with the Republic of Bulgaria. Tender documents to invite an international bidding are being prepared.

E-763 Belgrade - South Adriatic

The highway corridor Belgrade - South Adriatic is one of the most important strategic corridors in the transportation system of the FR Yugoslavia since it connects the most important social and economic centres in both federal units in FR Yugoslavia. The immense importance of the road corridor is evident because it belongs to the E-road network of the Central, South East and East Europe, the TEM system (Trans-European main roads) being one of its legs. The extension of this corridor north of Belgrade to Novi Sad, Subotica and Hungary (E-75 international route) is the shortest connection between the Central, North East and East Europe with the Adriatic Sea and South Italy. The importance of this leg in the TEM is manifested in its most direct contribution to one of the starting objectives of the TEM which is to interconnect the cold seas of the North Europe with the warm seas of the South Europe.

The preparation of the general design documentation and all relevant studies for the above transport route is in progress.

E-80 Nis-Pristina-Pec - border with Montenegro

The highway Nis-Pristina-Pec-border with Montenegro in the total length of 224 km is dealt with currently in the general design a and the related studies and analysis.

Public Utilities

A well functioning communal system is a prerequisite to the successful realization of development objectives in any country, so radical reforms initiated in the management, organization and financing of these activities is a primary task of our country. As the capacities of the state, local government and public enterprises to resolve problems in public utilities are increasingly diminishing due to the existing economic and financing circumstances, there is a need to find more flexible forms and modalities of organizing, managing and financing these activities.

One of the ways to overcome the shortage of financial funds is to grant concessions for public utilities. In June 1998 the Government of the Republic of Serbia approved recommendations of the cities and municipalities initiating procedures for the granting of concessions for the pursuit of public utilities of garbage collection and cleaning, recycling in the areas of the towns of Belgrade, Novi Sad, Nis and Kragujevac, and the municipalities of Subotica and Paracin.

It should be emphasized that in the field of public utilities foreign investment inflow can be realized not only in accordance with the Concession Law but also in accordance with the Law on Public Utilities.

Mining and Ores

With a view to the importance of mining and energy supply in the economic development of our country, as well as substantial investment requirements on the one hand and shortage of funds and national capital on the other, there is a need in this sector to materialize its potentials in order to attract foreign capital. One of possibilities to overcome these restrictions and to attract foreign capital is the granting of concessions in this sector, particularly with regard to renewable energy.

By adopting the Land Use Plan of the Republic of Serbia, a strategic document for the development and construction of energy related facilities that should link environmental protection with economic and energy policies, our country opted for an intense use of renewable energy.

With regard to the importance of the newly explored resources in the Area of Bogatic and Macva, the Government of the Republic of Serbia passed a Decree on granting concession for the exploration, exploitation and use of geothermal energy in the territory of the Bogatic municipality.

The evaluation of energy potentials of the geothermal sources in Serbia show that an intense programme of geothermal investigations could bring about savings in import oil in the amount of 500 000 tons by the year 2010, while direct utilization would reduce electric power consumtion by at least 1.200 MWe. Possible uses of geothermal energy are numerous in agriculture, aquaculture, heating, distance heating, heat generation for industrial facilities, drying of cereals and other plants abundant in our country, greenhouses, sports and recreation centres, etc. The municipal area of Bogatic is the richest in geothermal energy in our country. There is juvenile ground water, which originated more than 15 000 years ago, that can be used for drinking water after geothermal energy has been extracted from it. This energy and environmental quality helps the municipality of Bogatic to become a highly competitive region thanks to the high quality cold ground drinking water and good arable land. In boreholes, the water temperature ranges from 550 to 800 and the total quantity of thermal water allows 15-100 lit per second.

When the documentation listed in the Law on Concession is completed, a public bidding will be announced for granting this concession.

Tourism

With regard to the international tourist market that has been recording remarkable results over the last years with a tendency of growth, and taking into account the tourism potentials in Serbia, tourism should clearly be given an adequate role in the overall process of the economic recovery and the entry of our country to international economic flows. Serbia has, good, diverse and extensive potentials for the development of tourism, and only a small portion of them has been used.

Besides foreign investment, one of the ways to remove bottlenecks in our tourist economy fast and efficiently and create conditions for the establishing and functioning of a modern and market adjusted concept of its development in these regions, is to grant concessions in the sector of tourism.

The Government of the Republic of Serbia
Agency for Investments into Activities
of Concern to the Republic

Acting Director
Minister Dejan Kovacevic, B.in Civ. Eng.

Phone/fax
+381 11 3614653
+381 11 3614653
+381 11 643136

Authors: Marija Pavic, B.in Civ.Eng.
Jelena Lukovic, B.in Econ.

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