EBRD and EU scale up support for Albania’s railways

• EBRD leads on the financing of a €373 million railway project in Albania
• Loan to support rehabilitation and electrification of 120 km Vore-Hani i Hotit railway line
• Agreement signed at the sidelines of the Western Balkans Investment Summit 2024

The European Bank for Reconstruction and Development (EBRD) is stepping up its support for strategic transport links in Albania by providing a €98.75 million sovereign loan to the government for the rehabilitation and electrification of the Vore-Hani i Hotit railway line. The beneficiary of the project is Hekurudha Shqiptare, the state-owned railway company.

The Bank is leading on a project worth €373 million, co-financed by the European Investment Bank (EIB) and the European Union (EU) through the Western Balkans Investment Framework (WBIF), which is providing €128.8 million in grants and technical assistance support of up to €12.1 million.

EBRD President Odile Renaud-Basso and Albania’s Deputy Prime Minister and Minister of Infrastructure and Energy Belinda Balluku signed the loan agreement at the sidelines of the Western Balkans Investment Summit 2024.

This railway line is over 120 km long and connects Vore in central Albania to Hani i Hotit on the border with Montenegro, boosting regional connectivity in the Western Balkans and integration with EU markets. Part of the Trans-European Transport Network (TEN-T) extension in the region, this line is Albania’s only railway connection with its neighbouring countries.

Supporting a vital but under-invested sector in the country, this project helps Albania’s social and economic development. It boosts the green transition by promoting a modal shift from road to electrified rail, a more efficient and climate-friendly mode of transport.

In addition, it pushes forward the reform agenda in the country by helping the railway company to prepare for the operational phase through the development of a framework public-service contract in line with international best practice.

EBRD President Odile Renaud-Basso said: “Regional connectivity is a strategic priority for the EBRD in the Western Balkans, especially in the light of broader EU integration. This project is another milestone in that direction, demonstrating our commitment to Albania’s and the region’s European future.”

Belinda Balluku, Albania’s Deputy Prime Minister and Minister of Infrastructure and Energy, said: “The Vore-Hani i Hotit railway line marks the second rail infrastructure project in Albania, part of a national strategy to enhance the quality and accessibility of rail services throughout the country, while fostering connectivity and economic relations with neighbouring countries – in this case, with Montenegro, to be followed by the first rail segment of Corridor VIII that connects the Adriatic Sea to the Black Sea. These investments will drive economic growth and social development in Albania, aligning with the goal of promoting green, sustainable and integrated economies in the Western Balkans. The government remains grateful to the EBRD and the EU for consistently supporting the development of strategic projects in Albania.”

This project marks the Bank’s second railway investment in Albania following a €36.9 million loan for the Tirana-Durres section, which is currently under construction. The investment is co-financed with a €35.5 million EU investment grant through the WBIF and the government of Albania.

To date, the Bank has invested around €2 billion in Albania through 149 projects.