Macedonia's Public Enterprise for Railway Infrastructure has received a €46.4m 15-year loan from the European Bank for Reconstruction and Development (EBRD) to upgrade section 1 of the FYR Macedonia Railway Corridor VIII Eastern Section.
The loan will be used to renovate the 30km Kumanovo-Beljakovce railway section, which is the first phase of a project to build a direct rail link between Skopje and Sofia in Bulgaria.
Construction is scheduled to start in the first quarter of 2013, field works are set to be completed in three to four years, with the tender for construction expected to be announced in September 2012.
The Eastern Section of Corridor VIII is 88.2km long and divided into three sections: Kumanovo to Beljakovce, Beljakovce to Kriva Palanka and Kriva Palanka to Deve Bair, which is located on the Macedonian / Bulgarian border.
Macedonia's rail network primarily consists of two corridors, and renovating one of them could give the country and its neighbours a new route for trade, according to the EBRD.
The EU's Western Balkans Investment Framework has also provided a €4m grant for the project design, tender preparation and implementation assistance.
The Macedonian project is also supported by a €175,000 grant from the Central European Initiative.
EBRD director for transport Sue Barrett said that once all of Corridor VIII is operational, it will give Macedonia a shorter route to Black Sea ports.
"It is also expected to stimulate the regional economy by making transportation flows easier," Barrett said.
Further development of the rail line, which is part of the Pan European Rail Corridor VIII, will finally link the Black Sea in Bulgaria with the Adriatic in Albania.
Macedonia's Vice Prime Minister and Minister of Finance Zoran Stavreski said that the corridor will develop a transportation system that will contribute to increasing trade between Albania, Macedonia and Bulgaria.
"It will improve both access and connection with neighbouring countries and thus increase the competitiveness and development of the economy, as well as communication with European countries," Stavreski said.