* Project to overhaul Belgrade waterfront to cost 3 bln
* Dubai-based construction firm Eagle Hills to provide
* Critics question viability, cost of project
By Ivana Sekularac
BELGRADE, June 27 Serbia unveiled plans on
Friday to redevelop the Belgrade waterfront, aiming to make the
capital a tourism and business hub, in a controversial 3 billion
euro scheme that will be funded by Gulf Arab cash.
The Belgrade Waterfront project promises office and luxury
apartment blocks, eight hotels, a shopping mall and a tower
resembling Dubai's landmark Burj Khalifa, albeit a quarter of
the size at 200 metres, on the right bank of the Sava River.
It is the signature project of Prime Minister Aleksandar
Vucic's two month-old coalition government, which has pledged to
create jobs and growth and turn Belgrade into a business hub for
the Western Balkans. But it has also drawn criticism from
architects, economists and corruption watchdogs, who have raised
concerns over its design, cost and transparency.
"It (the project) will make Belgrade a regional centre and
it will attract many tourists," Vucic said at a press conference
held at Geozavod, a renovated 1907 building that dominates the
area and will house the Belgrade Waterfront Gallery.
The proposed area for development, Savamala, houses grand,
century-old buildings that have become derelict, though the area
has started to re-emerge as a cultural hub. Unlike some parts of
Belgrade, the area escaped damage by NATO bombing during the
Kosovo conflict in 1999 but the right bank of the Sava is
blighted by a seedy central railway station and bus terminus.
The project is to be co-financed and led by Dubai-based
construction company Eagle Hills, although Eagle Hills and the
Serbian government have yet to form a joint venture and define a
co-financing model. Eagle Hills has agreed to put up the 3
billion euro ($4.08 billion) cost of the scheme but the terms
have not been settled and it is unclear how much the Serbia
government will contribute in funds.
It is the latest sign of increasingly cosy economic ties
between the United Arab Emirates and Serbia under Vucic, a
former ultranationalist who has rebranded himself as a
In March, while Vucic was deputy premier, Serbia secured a
$1 billion, 10-year loan from the United Arab Emirates to prop
up its budget. Last year, Abu Dhabi's state-owned Etihad Airways
bought a minority stake and gained managerial rights in troubled
Serbian flag carrier JAT Airways.
Critics have pointed to the absence of public tenders for
the project. Others question the economic wisdom and viability
of the project in a country under pressure to cap its deficit
and public debt, which stand at 7 percent and 63 percent of
gross domestic product respectively. On top of building costs,
the government will also have to compensate residents who will
With unemployment running at 20 percent and the average net
wage in Serbia just 380 euros a month, the project appears
unnecessarily lavish to many members of the public, who say the
government should be building roads and hospitals instead.
Developing the waterfront has been talked about by city
officials since the 1970s, but successive governments have never
managed to find the funds to finance it.
While that problem appears to have been solved, some
economists now question whether there is enough demand for the
amount of upscale office space or luxury flats envisaged in the
($1 = 0.7359 euros)
(Editing by Matt Robinson, Zoran Radosavljevic and Susan