European transport networks – the road to economic connectivity in Southeast Europe

by Tsvetan Ivanov, Deyan Matov

The transport infrastructure of SEE consists of national transport systems and a number of integrated international networks that upon their completion should ensure quick and unhampered movement of people and goods across Europe. This makes the integrated European transport system a key prerequisite for the seamless operation of the internal market and for the economic, social and territorial cohesion of the European countries.

In accordance with the EU initiative to create integrated road and railway networks in Europe, new laws on road categorisation and railways were adopted in most non-EU member states in the region. Furthermore, infrastructure-oriented investments, managed by the governments and substantially supported by EU funding schemes, are also likely to be important growth drivers in the future.

In 2012 foreign direct investments (FDI) hit the bottom in most countries in the region, weighing on their economies and the civil engineering and construction sectors in particular. According to the United Nations Conference on Trade and Development (UNCTAD), in 2011 the total FDI inflows in Albania, Bosnia and Herzegovina, Croatia, Macedonia, Montenegro and Serbia amounted to 4.745 billion euro, up from 3.109 billion euro in 2010, but still 45% lower than in 2008.

Social factors

The deteriorating demographic situation in SEE, except the countries in the Western Balkans, will weigh on their development in the long run. The decreasing fertility rates, the increasing average age of the population, the concentration of the population in urban areas and the depopulation of large rural areas are the main demographic burdens in SEE. However, road and railway infrastructure development can play a significant role in the economic recovery of such areas. The constantly increasing mobility, thanks to the European policy for removing barriers for the movement of people, goods and capital, however, calls for the development of an integrated transport network throughout Europe.

Technological factors

SEE is well behind Western Europe in terms of technological innovations. Another underdeveloped area in SEE is the implementation of the European Strategy for Intelligent Transport Systems, which aims to secure efficient transport infrastructure management and reduce traffic congestion, road accidents and carbon dioxide emissions.

National transport systems of SEE countries

In contrast to the sharp construction slowdown in SEE, transport infrastructure remains one of the most dynamic sectors in  the region’s economy. The main trigger for transport infrastructure development is the massive public investment, both by the national governments and the EU.

Improved utilisation of EU funds will contribute significantly to the recovery of the transport infrastructure sector in SEE. The European Commission strives to promote growth, employment and competitiveness via targeted infrastructure investment at European level. This could be achieved with the means of the Connecting Europe Facility (CEF), aimed at construction of integrated trans-European transport, energy and telecommunication networks. For the 2014– 2020 programming period CEF’s proposed budget for transport infrastructure projects for the entire EU is 31.7 billion euro.

The goal of EU’s Cohesion Policy is to reduce the development gap between the different EU regions. It grants aid via the structural funds, the Cohesion Fund and various initiatives. Its major tools include two structural funds – the European Regional Development Fund (ERDF) and the European Social Fund, as well as the Cohesion Fund. The latter is a financial instrument used to support investments in the economies of EU member states with gross national income per capita below 90% of the EU’s average. Up to 85% of the value of transport infrastructure projects can be financed by the fund. All four EU member states in SEE – Bulgaria, Croatia, Romania and Slovenia – are eligible for financing from the Cohesion Fund.

The country with the largest transport network in SEE in 2011 was Romania. It was the leader in the amount of transported cargo by all types of transport. Romania also received more funds from the EU’s Operational Programme Transport for the period 2007–2013 than any other country in the region – 4.57 billion euro.

p44 road network in SEE

p45 European cohesion policy

p45 Carried freight in SEE countries in 2011 (tonnes

p45 Carried passengers in SEE countries in 2011

Integrated European transport networks

Pan-European corridors

The purpose of the ten pan-European corridors is to connect Western and Eastern Europe on the one hand, and to link the eastern European countries on the other hand. These corridors are distinct from the TEN-T network, which is a project of the European Union.

Six of the pan-European transport corridors pass through SEE.

Corridor IV from the German cities Dresden and Nuremberg to Istanbul, Turkey, with branches to Thessaloniki, Greece, and Constanta, Romania, passes through Romania and Bulgaria.

Corridor V from Lviv, Ukraine, to Venice, Italy, with branches to Bratislava, Slovakia, Rijeka and Ploce, both in Croatia, passes through Croatia, Slovenia and Bosnia and Herzegovina.

Corridor VII – the Danube River – crosses the territory of SEE from Vukovar, Croatia, to Sulina, Romania.

Corridor VIII from Durres, Albania, to Varna and Burgas, both in Bulgaria, lies entirely in SEE and crosses Albania, Macedonia and Bulgaria.

Corridor IX from Helsinki, Finland, Klaipeda, Lithuania, and Kaliningrad, Russia, to Alexandroupolis, Greece, passes through Moldova, Romania and Bulgaria.

Corridor X from Salzburg and Graz, Austria, and Budapest, Hungary, to Thessaloniki and Igoumenitsa, Greece, and Sofia, Bulgaria, passes through Slovenia, Croatia, Serbia, Bulgaria and Macedonia.

International e-road network

The International e-road network is a set of major roads throughout Europe, Russia, Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan and Turkmenistan. The network is designed and managed by the United Nations Economic Commission for Europe (UNECE) with the goal to encourage economic cooperation and integration among its member states. It includes 107 major roads with a total length of more than 160,000 km and 141 B-class roads. The e-road network spans across all countries in SEE except Albania.

Trans-European transport networks (TEN-T)

The Trans-European transport networks, designed by the European Commission, is a system of integrated roads, railways, air transport networks and waterways on the territory of the European Union. The aim of TEN-T is to establish an efficient trans-European transport network to meet the constantly growing transport among EU-member states. The major financial instruments provided by the EU to support the TEN-T programme include the Cohesion Fund, the ERDF and European Investment Bank’s loans and credit guarantees.

p46 kapka

The total sum, allocated to the TEN-T programme by the EU for studies and construction works for the period 2007-2013, amounts to 8.013 billion euro, up 80.88% against 2000-2006. The budget of the Cohesion Fund and ERDF increased by 76.10% to 44.20 billion euro, while European Investment Bank loans and guarantees rose by 28.02% to 53 billion euro. In November 2012, 379 projects with a total TEN-T funding of 7.1 billion euro were ongoing or completed. Out of these projects, 174 with a combined TEN-T funding of 5.6 billion euro made it to the 30 priority projects defined by EU. Romania received 1.9% of the total investments under this programme, Slovenia – 1.1% and Bulgaria – 0.6%.

Over 40% of the TEN-T projects worth 4.1 billion euro was designated for railway infrastructure. Out of the railway investments, 1.4% was allocated to Romania, 1.3% to Slovenia and 0.5% to Bulgaria. In November 2012, more than half of the works on the three priority projects in SEE were completed. The major subprojects with ongoing construction works within the priority projects at end-2012 are:

  • Sea2Sea project for a freight corridor from Bulgaria’s ports Varna and Burgas to Greek Alexandrupolis and Kavala, planned to be completed by December 2014 (part of PP 7);
  • reconstruction of the Nadlac-Arad and Timisoara-Sibiu roads, due to be complet-ed by 2015 (part of PP 7);
  • modernisation of the railway line Radomir– Kulata in southwest Bulgaria with deadline December 2015 (part of PP 22);
  • reconstruction of a 90 km section of the Coslariu-Sighisoara line in Romania, due to be completed by end-2015 (part of PP 22).

p46 ten-t priority projects in SEE

p47 Stage of implementation of the priority projects as of November 2012

SEETO comprehensive network

The South East Europe Transport Observatory (SEETO) is a regional transport organisation set up by the European Commission and the governments of Albania, Bosnia and Herzegovina, Croatia, Macedonia, Montenegro, Serbia and Kosovo. The aim of SEETO is to support the development of transport infrastructure in the seven states and integrate the SEETO comprehensive network within the TEN-T standards. The result of the SEETO network will be the logistics interconnection of the SEE countries outside the EU. The goal of developing transport infrastructure is to avoid the isolation of the region from the main transportation corridors of the EU, which surround the Western Balkan countries.

The SEETO network encompasses:

  • 6,529 km of roads and 4,777 km of railways in all SEETO member states;
  • 17 airports in seven countries;
  • 10 seaports in Albania, Croatia and Montenegro;
  • 1,359 km of inland waterways (the rivers Danube, Sava, Tisa and Drava) with eight river ports in Croatia, Serbia and Bosnia and Herzegovina.

In the 2007-2011 period the total investments in the SEETO comprehensive network amounted to 10.8 billion euro. This sum includes 6.7 billion euro investments in completed, and 3.9 billion euro in ongoing projects. It is worth noting that there is a huge difference in the sources of financing between the completed and ongoing projects. Most of the completed projects were launched before the downturn from 2009 and received 43% of their financing from the countries’ national budgets. On the other hand, most ongoing projects received financing after the breakout of the crisis, when the countries reduced their investment budgets. As a result, the share of state funds in the SEETO financing more than halved to 19%. Accordingly, loans from international financial institutions became the major source of financing for ongoing projects in the 2007–2011 period with a share of 48%.

In 2011 Croatia was the country with the biggest expenditure in SEETO – 65.3 million euro of the total 131.8 million euro invested by the SEETO regional participants in road network maintenance and 67.7 million euro of the total 97 million euro invested in rail network maintenance was spent by Croatia.

In 2011 the length of the SEETO comprehensive network decreased by 25 km of roads and 30 km of railways compared with 2010, due to the exclusion of three minor roads in Albania, Macedonia and Montenegro.

p47 Sources of funding for SEETO investment projects;

p47 SEETO comprehensive road and railway network in 2011

RailNetEurope (RNE)

RailNetEurope (RNE) is a non-profit association of 36 railway infrastructure managers and allocation bodies from 26 European countries. RNE aims to facilitate international railway traffic across Europe through the creation of a harmonised Europe-wide timetable, fostering cooperation between the national railway operators and real-time information exchange across borders.

The total length of the railway network covered by RNE exceeds 230,000 km. Four RNE corridors pass through the territory of SEE, two of which (C07 and C08) cover only short sections within the Slovenian railway network. The other two encompass the main lines in the directions North-South and East-West on the Balkan Peninsula. The C09 corridor passes through Bulgaria and Romania, while C11 crosses Slovenia, Croatia, Serbia and Bulgaria. The main railway axes in all above-mentioned countries are part of the RNE network, which ensures unhindered trans-border railway transport.

p48 RNE Corridors in SEE

The future of the European transport system


  • Sufficient density of the road and railway networks;
  • Willingness of governments to support transport infrastructure development;
  • Favourable geographical location that determines the high number of international corridors passing through the region.


  • Non-uniform development of transport infrastructure in SEE countries;
  • Insufficient length of highways, considering the growing traffic, and the low quality of national and local roads;
  • Lack of high-speed railway lines and poor condition of the existing rail network.


  • Increasing movement of passengers and goods across Europe, leading to steadily growing demand for transport infrastructure;
  • Large trans-border projects as an opportunity for economies of scale;
  • Implementation of EU standards at all stages of project development and construction.


  • Technologically underdeveloped civil engineering and road construction companies;
  • Possible deterioration in governments’ policy towards investments in transport infrastructure;
  • Insufficient utilisation of EU funds due to corruption and low transparency.


International transport networks turn out to be a key instrument in the EU’s efforts to achieve integration among all European countries at an economic, social and cultural level. Upon their completion, these networks will build up a united European transport system with a uniform development and road and railway network density, which would be beneficial to all.

The unification of the SEETO comprehensive network with the networks in the EU member states will have an indispensable role in overcoming the western Balkans’ isolation from the rest of Europe. In addition, it will help accelerate their economic development.

Infrastructure upgrades will bring more flexibility to transport companies, more intensive competition and improved quality of cargo and passenger services at lower cost. The upgraded transport network will also lower costs for companies operating in the neighbouring regions, which in turn will increase their competitiveness.

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