International Information Centre for Balkan Studies

Turkish banks to lend Serbian government money to pay Turkish company

January 10, 2020

Nova Ekonomija magazine said in its latest issue that the Serbian government is set to take out a loan of more than 200 million Euro to pay for infrastructure projects by a Turkish company whose officials were suspected of corruption and breaking labor laws.

The magazine said that the 219.2 million Euro loan will be taken from the Turkish banks Ziraat and Denizbank for infrastructure projects in the northern Vojvodina province and the Sandjak area in the west of the country which has a large Moslem population with historic ties to Turkey.  

Prime Minister Ana Brnabic’s cabinet adopted a draft law on December 30 to confirm the loan contract with the two banks. According to the contract, the Turkish Tasjapi company will build a highway between Sremska Raca and Kuzmin, a bridge across the Sava river and reconstruct the Novi Pazar-Tutin road.  

The loan will come in the form of two credit lines – the first totaling 19.2 million Euro and the second 200 million Euro with an annual interest rate of 2.5 percent. The grace period for the first credit line starts two years after the first installment with a 10.5 year repayment period in 21 equal installments. The grace period for the second credit line is four years after the first installment with a nine year repayment period in 18 equal installments. The loans cover 80 percent of the cost of the projects with the remaining 20 percent coming for the Serbian budget.  

Nova Ekonomija recalled that the Tasjapi company’s CEO and several CIP company staff were arrested on suspicion of corruption in March 2019, adding that inspectors found 53 unregistered workers in the company in September 2019.

Source:  http://rs.n1info.com/English/NEWS/a559323/Turkish-banks-to-lend-Serbian-government-money-to-pay-Turkish-company.html

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