Serbia Local Infrastructure and Institutional Development Project

active

The project will improve Local Self Governments (LSGs) capacity to manage sustainable infrastructure and improve access to economic and social opportunities in climate aware manner. The Project will finance a mixture of investment and technical assistance to improve green and inclusive infrastructure service delivery at the local level, including the implementation of the relevant chapters of Sustainable Urban Development Strategy (SUDS). The Project will focus on strengthening capacities and technical approaches to implement existing regulatory, planning, and legal frameworks. Investments will prioritize improving integrated mobility infrastructure and overall resilience of LSGs. To incentivize change, the LSGs will receive grant transfers from the central level for infrastructure investments and will sign Framework Agreement with the Government of Serbia, which will include a set of commitments to improve infrastructure service delivery at the local level. The Project should open a path for a long-term engagement in support of LSGs in Serbia. It will inform the development of a policy and investment framework that can be strengthened over time and allow the Bank and other development partners to support Serbia’s EU accession and improved absorption of pre- accession funds. The Project is designed in a manner that could absorb resources from other donors and also extend the sectoral coverage beyond local roads and mobility.The Project goal will be achieved through implementation of the following three components:Component 1. Climate Smart Mobility (USD 282 million)The objective of this component is to improve mobility within the LSGs through strengthening system for transport infrastructure service delivery and by supporting transport infrastructure renewal that will increase resilience to natural disaster while reducing emissions of GHGs and local pollutants including PM2.5 and NoX. The component will finance targeted investments, analytics, technical assistance, and tools. Support to improved planning and management will ensure that these investments are inclusive, gender informed, and that infrastructure is managed in a sustainable way over the long term. Each LSG will be eligible for grants for infrastructure investments up to a value determined per predefined formula, but the award of a grant will be subject to compliance with agreed eligibility and compliance criteria. The component will be implemented through (i) Investments in climate smart mobility; and (ii) Sustainable mobility.Component 2. Strengthening Capacity for Infrastructure Service Delivery (USD 11.5 million).The objective of this component is to improve the effectiveness and sustainability of infrastructure service delivery at the local level through strengthening LSGs’ capacity to implement current planning and PFM policies. The component will finance a mixture of technical assistance and capacity building activities focused on: (i) Enhanced Participatory Planning and Preparation of Pipeline Projects; and (ii) Strengthened institutions, PFM, and access to financing. Component 3: Project Management and Awareness Raising (USD 6.5 million)The objective of this component is to establish institutional set up that will enable successful implementation of the project and raise awareness about importance of green transition and sustainable mobility. The subcomponent will support the establishment and maintenance of the strong PIU and strengthening of CFU. The PIU will be responsible for overall management of the Project and will provide day-to-day project management support to the LSGs to ensure transparency and accountability of the Project’s interventions and results. Expenses that may be financed by this activity include PIU salaries and CFU salaries in accordance with the rotation model of financing, operating costs, office equipment, dedicated web page and supervision platform, awareness raising campaigns, communication strategy, and the PIU and the CFU training. To facilitate online supervision, a georeferenced platform will be introduced.The total Project cost of US$300 million will be jointly co-financed by IBRD and AFD, where IBRD will be providing US$100 million and AFD US$200 million. The World Bank and AFD will jointly finance the same contracts under the Project in accordance with agreed financing parameters and supervision of the Project will be conducted by the World Bank under its rules.