GSP Beograd to Borrow EUR 325 Million for Purchase of New Vehicles – Are Turkish Trams to Arrive Too?

The purchase of new trams for the needs of the Belgrade public transit company GSP Beograd and the renewal of the tram subsystem have been announced for years, but no public procurement procedures for their purchase have been opened. That the time for the purchase of new trams will finally come is indicated by the statements of the mayor of Belgrade, Aleksandar Sapic, about this topic. On several occasions this year, Sapic pointed out that possibilities for negotiations about the procurement of new vehicles were opening. Talking about the renewal of the GSP rolling stock, this spring and summer, Sapic announced that, among other things, the idea was to purchase 100 trams and added that, if the current plans for the procurement of new vehicles came true, practically the entire rolling stock of GSP would be renewed within two to three years.

That the announcement of the purchase of new trams is not without basis this time is also indicated by the announced daily agenda of the upcoming session of the City Assembly of Belgrade, scheduled for September 13, where, among other things, the Proposal of the Decision on the Amendments to the Decision on the Budget of the City of Belgrade for 2023, but also the Decision on Giving Approval to the Decision on a Long-Term Financial Borrowing of GSP Beograd, will be discussed.

As can be seen from the document, the reason for the requested long-term loan from commercial banks in the amount of RSD 38,000,000,000.00 (EUR 325 million) is an investment, that is, the purchase of new vehicles. This, then can pertain to the purchase of road vehicles as well, but the great value of the procurement indicates that the procurement likely includes trams, whose individual price is usually higher than EUR 2 million.

In order for the borrowing to be realized, the founder, in this case, the City Assembly of Belgrade, needs to give its consent, because the borrowing is high, that is, it is 30% or more than the book value of the property of the company from the latest annual balance.

The announcement of the borrowing of GSP attracted attention within the political scene in the city even before the session of the City Assembly. Nikola Jovanovic, the director of the Center for Local Self-Government (CLS) and a former member of the city parliament, publicly asked mayor Aleksandar Sapic whether the reason for the mysterious borrowing of GSP of as much as RSD 38 billion was the purchase of the Turkish trams of the Bozankaya brand.

– Did the head of Sapic’s cabinet secretly go to Turkey to negotiate there with the Turkish tram producer Bozankaya, without any legal basis or a regular tendering procedure? Has the borrowing for this purpose from the private bank Halkbank already been agreed? – says the public letter of the director of CLS.

In Europe, trams made by Bozankaya are only used in Romania and they don’t belong among the established class of trams, nor is there any objective reason to favor them in advance, Jovanovic says in his statement.

In the past days, other representatives of the opposition in Belgrade have reacted as well, asking why GSP would borrow such a large sum, if the city budget amounts to as much as EUR 1.6 billion.

The latest fully new trams for the purposes of public transport in Belgrade were bought over ten years ago, namely, 30 vehicles made by the Spanish CAF. After that, on several occasions in the past decade, the purchase of new trams, both domestic and foreign, has been announced several times, but no concrete steps have been made, so today, the basis of the tram susbsystem in Belgrade consists of Czech trams and trams from the Swiss donation. A part of the Belgrade trams is over half a century old.

When it comes to the tram network in Belgrade, it has been renewed within the reconstruction of city traffic routes, such as Ruzveltova Street, Oslobodjenja Blvd, the stretch from Ruzveltova Street to the Zoo, the Sava Square and New Belgrade. In recent times, a whole new tram route was established between Cukarica and New Belgrade when tracks were laid on the Ada Bridge, making it the second tram bridge in the city along with the Old Sava Bridge.

D. A.

Grad Beograd

GSP Beograd

Centar za lokalnu samoupravu Beograd

Bozankaya

Halkbank

CAF

Aleksandar Šapić

Nikola Jovanovič

means of transport

vehicles

public transport

passengers

tram network

rail systems

reconstruction of streets