Due to its strategic position in the heart of Southeast Europe, Serbia is often referred to as a gateway to Western Europe. Serbia is home to three important European transport corridors: VII (the River Danube), X (the international highway and railroad), and XI (connecting Central Europe and the Adriatic Sea), providing excellent connections with Western Europe and the Middle East.
Underfunding is a longstanding problem. The government has begun to address that in a significant building boom in recent years using grants, loans, and its strong fiscal position, most notably in highways, but much work remains. In December 2019, the government announced the new National Investment Plan, allocating approximately $14 billion for major development projects to be completed by 2025. A large portion of the funds will go to infrastructure projects, including road, rail, air, and water upgrades, which will provide opportunities for U.S. firms in these areas.
With the shared interest of attracting more U.S. companies to this burgeoning sector, in 2018, the United States and Serbia signed a Memorandum of Understanding (MOU) on Cooperation in Infrastructure Development in Serbia. Following the signing of this MOU, U.S. construction firm Bechtel concluded an approximately $1 billion contract with the Serbian government to design and construct a 112 km stretch of highway in central Serbia, the Morava Corridor. The construction started in February 2020 and is expected to be finished by the end of 2022.
Roads
Serbia’s road network is 45,220 km long, of which 952.7 km are toll highways. It also includes 2,960 bridges and 85 tunnels. According to the Serbian Ministry of Infrastructure, about 1000 kilometers of fast roads are currently being designed and built in Serbia.
Railroads
Transport of goods via railroad is cost-effective, and through Pan European Corridors X and VII, Serbia offers access to all European destinations. As in many countries, Serbia’s railway system suffered due to lack of investments in previous years, but the country has made serious efforts to restructure and modernize it. A new high-speed railway from Belgrade to Novi Sad started operating as of March 2022. Since the liberalization of Serbian railroad transportation in 2016, Serbian Railways has signed contracts with 43 international forwarding companies, and “shuttle” container trains have started using Serbian railways for pan-European transport. The maximum spindle capacity of the Serbian rail system is 22.5 metric tons. The priority now is the development of multimodal transportation (transition from road to railway and river transportation).
Air
Serbia can be reached by air through its two international airports: Belgrade’s Nikola Tesla Airport and Nis International Airport. Airport Morava near Kraljevo in central Serbia opened in 2019 and has not established a regular flight schedule, in part due to the COVID-19 pandemic, but is expected to become Serbia’s third international airport. An airport in Vrsac is currently being used only for domestic non-commercial flights and training and leisure aviation but is expected to soon be granted an international certification. Transportation by air to and from Belgrade is possible to almost every destination in the world, either directly or by layover. In 2016, national carrier Air Serbia introduced direct flights to New York City.
Serbia owns 92 percent, and Montenegro owns eight percent, of the Serbia and Montenegro Air Traffic Security Agency (SMATSA), which controls air traffic over Serbia, Montenegro, part of the Adriatic Sea, and 55 percent of the upper airspace over Bosnia and Herzegovina.
In March 2018, the Serbian government awarded a 25-year concession for Belgrade’s international airport to France’s operator, Vinci. The firm committed to finance, develop, and manage the airport’s infrastructure, and to operate the airport itself. Vinci is investing several hundred million euros to boost the airport’s capacities from between five and seven million to at least 17 million passengers per year.
River
Serbia’s river corridors offer 959 km of excellent, cost-effective transportation routes. The Danube (588 km) represents the most reliable year-round navigable route. Artificial canals supplement this to form the Rhine-Main-Danube international canal, which allows barge traffic between the North Sea and the Black Sea, and Danube-Tisa-Danube, together offering a network of routes that provide access to all Danube-basin countries. The Sava River links Slovenia, Croatia, Bosnia & Herzegovina, and Serbia, and is in the process of gaining the status of International Navigable Route.
Leading Opportunities
Roads
The highways and railroads along pan-European Corridor 10, in addition to Corridor 11, which will run from Timisoara, Romania, to Montenegro’s port of Bar, are priorities for Serbia’s infrastructure development. The EU considers these corridors critical to the region’s road and railway network.
In May 2021, work on the construction of the Fruskogorski corridor began, and in November construction started on the highway to Pozarevac, Veliko Gradiste, and Donji Milanovac.
Active construction projects include the Cacak- Pozega highway; the Morava corridor from Cacak through Krusevac to Pojate; the Kuzmin - Sremska Raca highway, and the Ruma - Sabac – Loznica highway.
Among the upcoming works is another important highway, the Sumadija corridor “Karadjordje”, and the construction of a 107 km long section of the highway from Pozega to Boljar to Montenegro is planned, which will speed up the journey to the Adriatic Sea. The new highway Belgrade – Zrenjanin - Novi Sad currently has two alternative routes and both are located east of today’s Zrenjanin road. The estimated value of the construction is around €600 million. In January 2020, the Serbian Government signed an MOU with a Chinese company for the construction of the highway Belgrade – Zrenjanin – Novi Sad.
The construction of the Belgrade-Sarajevo highway officially began at the end of August 2019 with the opening of a construction site on the Sremska Raca-Kuzmin section, about 18 kilometers long, whose value of works with the bridge over the Sava is €220 million. The deadline for construction is two and a half years.
The highway Vozd Karadjordje, the so-called Sumadija corridor, will have a total length of about 220 km. This road will have a direct connection with Corridor 10 and Corridor 11.
In addition to highways, high-speed road projects have also been announced: Backi Breg – Sombor – Kikinda border with Romania (175 km), Slepcevic - Pavlovica bridge (15 km), Kragujevac - Mrcajevci (33 km), Pozarevac - Golubac loop (70) km), Golubac - Donji Milanovac - Brza Palanka and Kladovo - Negotin (146 km), and Paracin - Zajecar - Negotin (140 km).
Airports
Serbia intends to convert all of its eight military airfields to commercial use.
Waterways
The government also plans to invest nearly $550 million in inland waterways, mainly for environmental remediation and ordnance-removal projects in the Danube River basin.
The Serbian government is looking for an appropriate location to build a new Belgrade port, and construction is expected to start by the end of 2023.
Another upcoming project is to upgrade the Smederevo Port terminal for bulk and general cargo. More than half of the total investment of roughly $106 million is required for construction of port infrastructure.
Railways
The state-owned railway company Zeleznice Srbije is planning infrastructure development and rolling-stock projects worth €2.5 billion, much of which is to be allocated to the construction of the Belgrade-Budapest high-speed railroad.
Upgrading the railway between Serbia and Bosnia & Herzegovina is of strategic importance for both countries. The project includes reconstruction and modernization of the railway for electric traction and for train speeds up to 120 km/h; the provision of electronic signaling devices to railway, station, and crossings; installation of stable electric traction plants for the entire railway, and potential reconstruction of tunnels and bridges.
In 2021, the Parliament adopted a law on utility services, which is expected to draw private investment in this sector through public-private partnerships, as well as facilitate investments in the underdeveloped wastewater processing, sewerage, water supply, and waste management sectors.
In addition, Serbia has identified projects that may be of interest to U.S. companies in design, construction, building materials, road and railway equipment, as well as other related industries. These projects offer an opportunity for U.S. companies looking to expand their export portfolio and enter the Serbian market. The projects are in different stages of development, from preliminary planning to tendering or direct negotiations.