PROJECTS WORTH MILLIONS GATHER DUST ON PAPER
It has been known for a long time that poor road infrastructure is one of the reasons for big and serious western companies not to hurry with their investments in Bulgaria. That's why during the last dozen of years each government has set its expansion and modernization as it priority. As a result thousands of sheets have been written and nothing more has been done, although the EU and international financial institutions undertook the major financial burden for the implementation of infrastructural projects. In other words, money has been ensured but always something prevents their utilization. And some of the projects that started, stumbled in the very beginning. That was the case with the reconstruction and modernization of the Sofia Airport. The project's implementations has been delayed for more than half a year through the fault of the chief construction contractor of the new passenger terminal (Lot B1) - the Austrian company Strabag - which demanded a revision of the contracted price of EUR112.2MN by another EUR11-40MN.The construction of the new runway has also been delayed due to additionally demanded USD4-5MN. The chief contractor (the Arabian JV between Mohamed Abdulmosin Al-Karafi Sons and Admak General Contracting Company) insists (for the time being inofficially) for amendment of the project, regarding that part of the runway which passes over the Iskar river, the Deputy Minister of Transport and Telecommunications Sofia Kssidova said in front of the BANKER weekly. But for her the problem is mainly in the construction supervision, to be conducted by the Dutch company NAKO. The analysis of BA System's independent consultants shows that due to the lack of an overall managerial project for the construction, the management is not active amd there are no standards and modern techniques for work, Ms. Kassidova says. However, Transport Ministry insiders are adamant that no additional funds will be released. That is also the opinion of institutions, financing the construction of the two facilities - the European Investment Bank (EIB), the Kuwait Fund for Arab Economic Development, and the EU through its pre-accession ISPA fund. Meanwhile, it became known that Strabag has agreed for a smaller bonus of EUR5.6MN. This time their claims are not for a change of the type of foundation, but for some compensation of the lost time. One way or another, Strabag insists for extending the term of the construction from 24 to 34 months. Various inadvertence may also upset other infrastructural intentions, that could be financed from abroad, experts from the branch fear. That might happen to the electrification of the Plovdiv-Svilengrad railway, which is part of Transeuropean Transport corridors IV and IX. According to projections, the speed of trains along that sector should reach 160-200 km/hour after completion of its reconstruction in 2007. But despite the EUR303MN, ensured by the EIB and ISPA, and the EUR37MN from the budget, the project's implementation has been delayed by more than a year due to the expropriation of land near the track. The tenders for picking up a construction contractor and supervisor will be probably invited by November 25 at the latest. It's curious that in this case financing institutions changed their approach and asked for an experimental reconstruction of just 37 km of the 170-km railways. They explained that the project might appear much more expensive than expected.The construction of the new bridge on the Danube river that will connect Vidin and Kalafat has been delayed, too. According to the initial plans, construction works had to start between March and June 2002 and to finish by the end of 2005. Still, debates and twistings by the Romanian side changed the deadlines several times. The bridge is part of the 4th cross European transport corridor and is included in the Stability Pact for Southeast Europe priority list. Most of the financial resources for it - EUR190MN, were paid in the end of 2000 and the beginning of 2001. The equipment totally worth EUR60MN will be supplied by the budget. The tender for design and construction is now expected to begin by the year-end or early in 2004. Construction should start in the third quarter of 2004.The good news is that the tenders are open for Bulgarian companies and that the procedure will stick to the Public Procurement Act. The launching date is set for 2007. Whether it will be observed depends on the Romanians who have to approve the tender documents prepared by the consultant.Sites along Bulgarian water roads are not in a better condition. The money needed for a new breakwater and a loose cargo terminal at the port of Bourgas will be increased. The EUR118MN credit from the Japanese Bank for International Cooperation and the EUR26MN budget tranche will not be sufficient because of the large amount of ammunitions dating back to the World War I that were found when the canal leading to the port was deepened. According to the plans of the Ministry of Transport and the chief executor (the Japanese consortium Penta Ocean Construction - Mitsubishi Corporation), the removal of the ammunitions will need another USD40MN and the construction works will be delayed by four to six months. The additional resources will be paid by the Treasury, of course.After all these troubles surrounding Bulgaria's infrastructural projects, the modernization of the port of Lom remains the only achievement Nikolay Vassilev's ministry can boast of. Initial expenses for the port modernization have been cut from EUR37MN to EUR29.7MN. Most of the money is already available (EUR5MN from the budget and EUR17MN lent by EIB). The Greek Plan for Balkans Economic Recovery (HiPERB) is expected to confirm the launching of EUR5MN free assistance. A consultant will most probably be chosen by the end of the current year, the Ministry of Transport and Telecommunications announced. The Government's new policy on development and modernization of the country's road infrastructure should be ready by then, the ministry hopes. Most important, the Government should be ready with the financing alternatives.