The Slovenia Times

Govt approves state guarantees for two key infrastructure projects


According to Infrastructure Minister Alenka Bratušek, the guarantee for the rail project is restricted to EUR 417 million, and for the Third Development Axis at EUR 360 million.

The bill will enable the state-owned companies 2TDK and DARS to negotiate much lower interest rates for the planned loans, the government said after the session.

The two projects are government priorities. "The implementation of these two projects means that Slovenia is maintaining the advantages of its geo-strategic location. This will strengthen the port of Koper, the Slovenian economy and probably secure additional jobs," she said.

The loan for the Koper-Divača project will have to be paid out by 2063, as envisaged in the law on the project. "The sources for paying off the loans have been secured and the money is already being collected, including from higher toll, tax on transshipment at Luka Koper and higher railway use fee," the minister said.

She is therefore confident that the state guarantees will never be enforced and that the bill will not affect the country' public finances.

The bill also envisages state guarantee for parts of the Third Development Axis, the expressway connecting the Koroška region in the north with Dolenjska in the south. The state will provide guarantees for the sections for which investment programme has already been confirmed.

These include the Velenje-Slovenj Gradec section in the north, and the Novo Mesto-Osredka section in the south. The loans will have to be paid off by 2055.

Due to the concession contract that the state has with DARS, the national motorway company, Bratušek thinks there is no chance for this state guarantee to be enforced either.

Based on DARS's business results from the past five years, which show it is a stable company, there is no fear that it could not meet its obligations, the minister said.

DARS as the concessionaire of the tolled roads in Slovenia welcomed the government's decision to provide state guarantee for the expressway project, saying it was of key importance for its realisation.

"The future revenue from the sections of the Third Development Axis ... will not suffice for return on the investment, including its management and maintenance," the company explained.

The project cannot be financed from the company's current operations, i.e. revenue from toll, which is why financing with borrowing is required, it added.

"The state guarantee ... is necessary and the only right signal to the financial markets that it is a non-risk investment," DARS also said.

The guarantee was also welcomed by the regional offices of the Chamber of Commerce and Industry (GZS), who said that the government had recognised the strategic importance of the Third Development Axis.

They expect that the parliament will confirm the bill and allow the project to continue, which would "establish conditions for the construction of a modern road and further accelerated development of the area."

The government's move also seems to have appeased a group which announced a protest for 17 October over delays with the implementation of the expressway project. The group suspended the protest until parliament takes a vote on the bill.


More from Nekategorizirano