Europe is changing drastically. While the EU invests billions in its eastern member-states for brand new highways, city face lifts and railways, Western states need to update their infrastructure: think of high speed lines and subway systems that are outdated. Meanwhile, many EU-candidates try to speed up the application process by mayor infrastructure works. In Europe under construction, Reasq takes you every Saturday to a new mayor construction site in Europe and tells the true story behind the project. Today: EU-candidate Montenegro.
If you take the E80 road from the Montenegrin capital of Podgorica to Kolasin, you drive a few kilometres straight through the suburbs Masline and Zlatica before ending up in the Moraca canyon. Instead of 2 lanes, you suddenly get one in each direction. Rock on the left side, the Moraca river on the right side. Sometimes a house squeezed in between. It's the beginning of a 65km road that curves along the Moraca into the remote Montenegrin mountains. However, that feeling of remoteness abruptly ends when you turn around the corner in Duga, where 5 concrete pillars raise over 160 meters above the ground.
Around 150 workers are finishing there the Moracica Bridge, which should be ready in a few weeks. The five pillars will then be holding 960 meters of road over a 200m high gap over the Moraca river. Being the highest bridge of Eastern Europe, it's seen as the symbol of the new 165km A1 highway running through Montenegro from the coast to its Serbian border.
The biggest project in Montenegro ever
The highway is opening in 3 phases, of which the first one is expected to be completed next year. The first 41km section runs from the capital Podgorica to Matesevo, straight through the Dinaric Alps. The 20 bridges and 16 tunnels will cut travel times along the route with over 60%. But for all of that, a price has to be paid: the government estimated the costs of this 41km section on € 809.577.356 (or 19.745.789 per km), making it the most expensive highway in the Balkans and by far the biggest construction project in the country since its independence in 2006. The other 123km are estimated to cost another € 1.7 billion, even though that number is expected to be raised during construction in the next years.
The government estimated the costs of this 41km section on € 809.577.356, making it the most expensive highway in the Balkans and by far the biggest construction project in the country since its independence.
In comparison: Montenegro's BBP in 2017 was only € 4.2 billion. When I ask a local resident how the country managed to launch a project this big, he points at the white buildings at the bottom of the bridge. "They have been put here when they started working on the bridge", he says. "It's an accommodation for the workers as well as a shelter during work". When I notice the Chinese signs on the walls, the Montenegrin continuous: "It's set up by the China Road and Bridge Corporation. This Chinese state-owned company brought over its cheap employees and tax-free materials."
China's Road and Belt Initiative
According to Reuters, some 3605 workers are busy on the highway project. Roughly two-thirds of them are from CRBC. It's part of the deal between Montenegro and China, as the Asian superpower lent almost € 700 million (85%) for the project. The loan forced the government to raise taxes, partially freeze public sector wages and end a benefit for mothers to get its finances in order. An EU official states "that Montenegro has strangled itself by accepting such a loan which they'll never be able to pay back within the agreed time frame".
The project is part of the China's Road and Belt Initiative, with which China wants to get more control in Asia, Africa and with Montenegro now in Europe. With billion loans and big infrastructure projects, it wants to physically connect those countries with the Chinese borders as well as making the countries more dependent from Beijing. Many Asian and African countries have been able to modernise in a way they would have never been able to without the financial aid of China.
However, critics see the strategy as a debt trap and even speak from 'new colonialism'. They often name Sri Lanka as example. Between 2009 and 2015, the government modernised its Hambantota port with Chinese financial aid. It wasn't as profitable as expected and as Sri Lanka couldn't manage the loans, it was forced to lent the port to China for 99 years.
"Disbelievers"
Critics predict the same outcome for Montenegro as they wonder how Montenegro will ever pay back these enormous debts, especially when proceeding with plans for the remaining 123km section. Prime Minister Dusko Markovic calls those critics "disbelievers" and defends the highway by stating that it's essential for Montenegro in order to modernise. "It will be crucial for our future and will be finished at any cost". He also promised to deepen cooperation with China in other areas, including hydropower and tourism.
"The EU has been warning Montenegro for the Chinese loans, but the country needed the highway at any cost", says Reuters. If it will be a success or not, will become clear in the next years. If Montenegro manages to join the EU, funds from Brussels will help the country to pay his debts. But for now, it's hoping for an economical wonder with which Montenegro is going to give China its money back.
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