March 27 (SeeNews) - Croatia's government said it has issued guarantees on loans worth 107 million euro ($118 million) from the European Bank for Reconstruction and Development (EBRD) and Croatian development bank HBOR that will support the construction of the last remaining sections of Corridor Vc motorway in the country.
At the same time, the government approved the signing of two loan agreements with the two banks by state-owned motorways operator Hrvatske Autoceste (HAC), which is in charge of implementing the Corridor Vc project, the cabinet said in a statement on Thursday.
In particular, the EBRD will extend a 15-year loan worth 55 million euro at a variable interest rate of 6-month EURIBOR plus 1%. Principal and interest will be repaid in semi-annual instalments, following a 3-year grace period.
HAC will also borrow 52 million euro from HBOR, also for 15 years with a 3-year grace period, at a fixed annual interest of 1.95%, payable quarterly. The loan will be extended in the local kuna currency with an euro clause, and will be provided in two tranches - of 34.3 million euro and 17.7 million euro.
The proceeds of both loans will be used to finance the construction of the last two remaining sections of Corridor Vc sections in the country - the 17.5 km Halasica bridge - Beli Manastir section and the 5.0 km Beli Manastir - border with Hungary section, located on the route than links Osijek - the fourth largest city in the Adriatic state, to Croatia's northern neighbour Hungary.
The Croatian section of European transport Corridor Vc is some 90 km in length and, apart from the two stretches north of Osijek, it is already complete.
Corridor Vc is part of the Western Balkans Core Network. It has been established as an extension of the Trans-European Transport Networks and will eventually link the Hungarian capital Budapest to the Croatian Adriatic port of Ploce via Bosnia.
($=0.908131 euro)