The interest rate on the euro-denominated loan should be below 2% and the city can repay the principal over 40 years.
Prague City Councilors have agreed on the terms of a loan of up to CZK 23 billion (EUR 1 billion) to be granted to the city by the European Investment Bank for the construction of metro line D. The transaction only needs to be approved by members of the Prague City Assembly.
The CZK 23 billion loan covers almost half of the total cost of the metro line D construction between the Pankrac and Nove Dvory stops. Prague will have the option of drawing the loan in CZK or in EUR, while drawing in euros allows for interest rates below 2% per annum.
According to the city’s press release, the project for a new Prague metro line has attracted the attention of EIB experts as it is in line with the city’s approved climate plan and contributes to improving the quality of the environment.
Prague, however, insists that the state contribute financially to the construction as well.
About the new metro
The Prague Transport Company (DPP) started building the new metro line D on 21 April.
This first section is the most complex part of the entire route including the construction of two stations, one of which is a transfer. Along the 3 km metro section with various tunnels the construction will take place in six locations for the next 90 months.
The section will be constructed by the consortium of Subterra, Hochtief CZ, Hochtief Infrastructure, Strabag and Ed. Züblin, under a CZK 13.75 billion (EUR 563 million) contract awarded in 2021.
CZK 14.54 billion (EUR 595.4 million) is the total cost of the I.D1a section, including monitoring systems and certification.
The construction of Line D is divided into four successive sections. Work started on I.D1a section, the most demanding section, for which the construction will take up to 7 years. This will be followed by the Olbrachtova – Nové Dvory (I.D1b) section.
The public transport company DPP will soon announce the public contract for the contractor and plans to start construction in autumn 2023.
Three stations will be built in this phase and three interstation tunnels, from Olbrachtova station. The third section (I.D3) will start from Pankrác towards the center of Prague, on the Náměstí Bratří Synků – Náměstí Míru route. Its construction is expected to start in 2024.
The I.D2 is the simplest section and the last section where the construction work will take only about 4 years starting in 2025. The line will be served by 3 stations and one depot at Písnice.