Prime Minister of the Republic of Srpska (RS) Radovan Viskovic said that the authorities have cleared the proposed issue of bonds by state- owned power utility ERS on the Vienna Stock Exchange.
According to PM Viskovic, the issuance will take place in January 2022.
Last month, RS Minister of Finance Zora Vidovic announced that ERS will issue bonds on the Vienna Stock Exchange. She said that the bond issue is good for the company, rejecting the allegations of providing state guarantees for the issue. These are the bonds in the amount of 140 million euros, intended to provide funding for the construction of hydropower plants Dabar and Bistrica, for which ERS has already signed contracts with Chinese companies.
Under the signed contracts, ERS is obliged to provide 15 % of the funding in order to start construction works. However, the details regarding the bond issue has not been revealed.
However, the decision has been criticized by financial experts. According to them, If the money is used to finance a capital investment that is planned in the next 5 to 10 years and the return of investment is up to 50 years, then the Vienna Stock Exchange is not a place to go and borrow short-term funds, because it will be difficult to return them in such a short time.
