Банкеръ Weekly

Briefs

NEVERMIND THE ENTHUSIASM, DUNAV BRIDGE 2'S CONSTRUCTION IS PENDING

Dunav Bridge 2 is expected to be finished in 2006. However, neither the Ministry of Transport, nor the Stability Pact's co-ordinators are able to clearly state that construction works will be started in 2003.On the next year agenda is provided the procedure for appointment of constructor. The scheme will be engineering - the winner in the tender will prepare the final construction project. This was announced to the BANKER weekly by Georgi Saev, Deputy Minister of Regional Development and Public Works. Two firms have been allowed to participate in the Consultant Competition and their documents have already been sent to the Delegation of the European Commission. Alexander Zoev, Head of the Transport Policy Directorate of the Ministry of Transport, informed that the Delegation had inquired for some further details about the tender. Practically, a winner has already been named, yet Brussels insists on not revealing the firm for the time being. Deputy Minister Zoev hopes that the contract will be signed by mid-November.There were five candidates to participate in the competition for international consultant. Four of them were in consortium with leading foreign fimrs - the French Setoroute, the German Obermayer and the British Fabermonsel Ltd and Scott Wilson Holdings. Only the British company Heider Consulting Ltd was a single candidate. Two of these firms were allowed to take part in the real competition. The consultant is to prepare the object's preliminary project and the infrastructure on Bulgarian and Romanian territory. EUR5.7MN will be provided as financial aid on the ISPA program. It is a normal procedure when funds being provided by donors they to insist on the project to be cheaper. Brussels insists on maximum reduction of Dunav Bridge 2's construction expenses as taxpayers' money should not be spent on unnecessary luxury. The West European definition of luxury is the bridge to be a suspension one or to have additional architectural decorations. Of course, the Bulgarian side has accepted to stick to no-frills construction. We are also ready to make retreats on the price issue, but only provided that all preliminary requirements for the facility's capacity are fulfilled. The Bulgarian team underlined that no compromises would be made on questions concerning the traffic, the railroad and the highway. It has still not been specified whether the railroad will be double and what will be the maximum allowed speed. All these issues will be settled in 2003 - after finalization of the preliminary project.According to the intergovernmental agreement signed by Bulgaria and Romania the bridge will have four roadways (two on each side) and will allow for a two-permanent-ways railroad.Still Ivan Kostov's Cabinet was making great plans about construction of a second bridge on the Danube. The project was approved in February, 2000. In July, 2000, Bodo Hombach, special co-ordinator of the Stability Pact for South-Eastern Europe at the time and Muravey Radev, minister of finance, even personally inspected the site prepared for the constuction. Former president of Bulgaria Peter Stoyanov was filled with optimism that construction works would be started before his mandate's end. But the Europeans' sluggishness cooled the blue cabinet's enthusiasm to such extent that for some time the government was planning start of construction in 2001 with Bulgarian money. Today the only controversial issue is whether Dunav Bridge 2 is still among the priority projects for quick launch according to the Stability Pact. At any case construction has still not been started although the preliminary environmental report and all the economic, financial, technical and social analyses have been prepared. The territory development plans for Vidin and Kalafat have also been updated. Nevertheless, we are still at a stage which had to be reached half a year ago. The final financial scheme of Dunav Bridge 2 project provides a credit facility amounting up to EUR70MN to be received from the European Investment Bank. The first contract for EUR50MN has been signed and ratified. In 2001 the French government launched free financial aid amounting to EUR500,000 for preliminary research and advisor issues. The French Agency for Development AFD secured EUR5MN more. EUR470,000 were presented for researches by the German state-owned bank Creditanstalt fur Wiederaufbau. The institution also launched a credit of EUR20MN at alleviated conditions to cover construction works. The Stability Pact has promised EUR5MN for preparation of the auction documentation. Bulgaria should also receive EUR70MN (for construction works and construction supervision) on the ISPA program. Bulgaria will take part in the financing of bridge's design, supervision and management with about EUR4MN. Our country is supposed to invest EUR20MN more in its construction. Romania will cover part of the construction expenses on its territory. The revenues from the facility's exploitation will be distributed according to the sums invested by both countries.Forecasts provide 450 cars to pass the bridge daily in 2003. In 2030 their number is expected to reach 7018 a day. The railroad traffic will take over 535,000 tons of freight and 85,000 passengers in 2006. Invested funds are calculated to be repaid in 7-8 years' time.

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