Foreign contractors eager to build Macedonian tollways

10/09/2008

Macedonia is offering concessions to build seven segments of tollway, mainly towards neighbouring countries.

By Zoran Nikolovski for Southeast European Times in Skopje – 10/09/08

Contractors want to build 560km of road in Macedonia. [File]

Forty-eight companies and consortia have expressed interest in a prequalifying bid for concessions for seven tollways in Macedonia. The ministry of transport and communications says companies in Europe, China, India and North America filed letters of intent by the August 15th deadline.

The ministry will announce a bid for the design, construction and funding of tollways that will improve connections mainly with neighbouring countries. The following roads, measuring 560km in all, are involved: from Romanovce to Deve Bair towards Bulgaria (70km); from the Skopje bypass highway to the Blace border crossing towards Kosovo (13km); from Gostivar to Ohrid International Airport (93km); from Bitola to the border with Albania (8 km); from Medzitlija on the border with Greece to Veles (130km); from Veles to the border with Bulgaria (120km); and from Stip to Miladinovci, outside Skopje (49km).

The ministry plans to select when the roads will be placed under the concession holders' management in the second phase of the tender procedure. The concession holders will also have a deadline to complete the investments.

The ministry says the potential investors should make a master design with analysis of environmental impacts and the structure of project funding. The successful concession bidders will have to maintain their respective sections.

The government's aim, according to the ministry, is to improve the infrastructure for surface transport as part of its pursuit of EU membership.

Experts are hailing the tender as a timely move and a chance to develop the transportation network and exert a useful secondary influence on the economy. Slow transport of goods to European markets on Macedonia's existing roads has discouraged Direct Foreign Investment up to now. The project will also increase the desirability and value of roadside real estate.

Experts also say Skopje can spur secondary infrastructure development such as motels, parking lots, gas stations, access roads to historical sites, etc. along the roads.

Nevertheless, there are still concerns about the overall viability of the project, as expressed by former Transport and Communications Minister Ljupco Balkovski. He says concessions would be more lucrative and attractive if Macedonia synchronised highway construction with Bulgaria and Albania, its neighbours on the east-west corridor.

Otherwise, a lack of traffic could force foreign investors to operate the roads and charge tolls for decades to recoup their investments. Hard-pressed concession holders might charge higher tolls over a shorter period, inflicting hardship on motorists in a country where the annual per capita GDP was only 5,760 euros in 2007. "The state has to think about alternative roads for businesses and individuals who don't want to or can't pay to use highways," Balkovski said.