Albania has been awarded loans worth €325m to fund the modernisation of a 120km rail link between Vorë in the centre of the country to Hani i Hotit in its northwest, on the border with Montenegro.

The scope of work includes electrification, the reconstruction of 12 stations, the installation of a telecoms and signalling system, and safety improvements that will allow trains to travel at up to 120km/h.

The line will act as an extension of the Mediterranean Corridor Trans-European Network. It will also link Albania’s capital Tirana with Montenegro’s capital Podgorica, and form the only railway between Albania and the rest of Europe.

Although Albania is not a member state of the EU, funding was approved under the Team Europe initiative. It combines $100m from global arm of the European Investment Bank, a €126m grant from the EU’s Western Balkans Investment Framework and a €99m loan from the European Bank for Reconstruction and Development.

André Rizzo, EU business manager for Albania, said: “As Albania and the region move forward on their path to EU integration, people can already experience concrete benefits of this process.