EBRD and EU support construction of Corridor VIII in North Macedonia

EBRD to lend €110 million to build a 10 km motorway section of Corridor VIII EU to provide €20 million in grants through the Western Balkans Investment Framework The road will improve connectivity in North Macedonia and the Western Balkans

The European Bank for Reconstruction and Development (EBRD) and the European Union (EU) are stepping up their support for better connectivity in North Macedonia by financing the construction of a new section of the Corridor VIII motorway.  

A €110 million EBRD loan will finance the construction of and supervision services for a 10.2 kilometre (km) stretch of motorway from Bukojčani to Kičevo in the west of the country, as well as detailed design services for a 4 km subsection. The EU is co-financing the project with a €20 million investment grant through the Western Balkans Investment Framework (WBIF).

The new road and resulting improvement in connectivity will underpin North Macedonia's economic development by making mobility and trade easier. The modern infrastructure will also help to improve road safety and make the road more resilient to weather-related damage.

At the project signing, Andi Aranitasi, EBRD Head of North Macedonia, said: “The Bank has played a unique role in supporting the road sector in North Macedonia since 2001. It has financed the construction and modernisation of regional, local and pan-European roads and facilitated policy dialogue to strengthen the country’s institutions. With this new investment, we reaffirm our commitment to building better transport infrastructure in the country for the benefit of its citizens and businesses.”

Fatmir Besimi, Minister of Minister of Finance of North Macedonia, said: “Corridor VIII is a strategic infrastructural project for the country that will make it more competitive. With the construction of the Corridor VIII motorway in North Macedonia, the pan-European corridor will be complete, meaning better connectivity between North Macedonia, Albania, Bulgaria and the other European countries. This will open up new markets for companies in North Macedonia, improving their competitiveness and enabling sustainable economic growth.”

In addition to creating new jobs during construction, work on the new motorway section will provide opportunities to young people for construction skills development through on-site training. This youth-inclusive programme was developed by the EBRD to support the government’s efforts to promote youth employment. The project will also encourage greater private-sector participation, with a tender for a build-and-maintain contract, which will include addressing climate risks during the construction, operation and maintenance stages of the project.

In North Macedonia, Corridor VIII stretches for around 305 km, with 62 per cent of the country’s population connected to it. Its development has been identified as a strategic priority for the country, but around 60 per cent of it has yet to be built to motorway standards. The country has made efforts to rehabilitate and extend parts of the existing road and build new sections, with the aim of fully modernising the route.

Corridor VIII is an East-West road and rail transport corridor through Bulgaria, North Macedonia and Albania, linking Bulgaria’s Port of Varna on the Black Sea with Albania’s Port of Durres on the Adriatic Sea. It includes sea and river ports, airports, roads and railways, encompassing over 1,270 km of railway and 960 km of road.

The governments of Japan and Austria are also supporting the project by financing the youth inclusion programme and a climate-resilience assessment, respectively.

The EBRD has been supporting North Macedonia in its efforts to improve its transport infrastructure, with investments in rail and road. It has provided more than €400 million to date for the construction of roads.