Serbia’s debt to China at least 1.2 billion Euro

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Serbia’s debt to China stands at 1.2 billion Euro according to official figures but economy experts have warned that the figure could rise with more projects being planned.

According to the Public Debt Authority, Serbia owes about 1.2 billion Euro with another two billion Euro in loans from Chinese banks planned for in the 2021 budget.

The Serbian authorities have taken at least 11 loans from China’s Exim Bank to finance the construction of roads, railways and power industry projects. Those loans will be repaid over a period of at least 20 years. The biggest of the loans (830.5 million Euro) was to reconstruct the railway between the northern city of Novi Sad and the border with Hungary. Another 350 million Dollar Chinese loan was taken for the Belgrade-Stara Pazova railway, 374 million Euro for the Preljina-Pozega highway being built by the China Communications Construction Company and 208 million for the Surcin-Obrenoavac road. Most of those loans were given on condition that Chinese companies are engaged on the projects.

Journalist Mijat Lakicevic warned that the figures are not the total because the data is not all in one place. He said the debt reaches as high as eight billion Euro and could go as high as 15 billion including all planned projects. That would account for a third of Serbia’s total foreign debt. He said that deals made without a tender are more expensive and added that some of the money has to be funneled back to the Serbian authorities.

Fellow journalist Aleksandar Milosevic warned that the deals lack transparency because they are all made bilaterally with no competition in sight. “The question is how the deal was made and if it is a good thing for Serbia. Are you financing what you really need or just something popular,” he said.