Chinese company and Montenegro, Teamwork on the coastal highway

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Contract signed with Shandong International Economic & Technical Cooperation Group, a company previously linked to some controversial projects in the region, envisages building a 16-km highway between Budva and Tivat.

Montenegro’s government on Wednesday signed a construction contract with Shandong International Economic & Technical Cooperation Group, a Chinese company previously linked to some controversial projects in the region, to build a coastal highway.

According to the government, the company will build 16 kilometers of a new highway between the coastal towns of Budva and Tivat, and the 53-million-euros’ worth project should be finished in two years.

Outgoing Prime Minister Dritan Abazovic said the project was financed from the budget and from 14 million euros credit from the European Investment Bank.

“This is only the first in a series of projects concerning the coast, which should facilitate traffic. This construction was urgent, as in the summer tourist season more than 30.000 vehicles daily pass between those two towns,” Abazovic told a press conference.

Shandong International Economic & Technical Cooperation Group’s representative in Montenegro, Yao Lu, said the project will improve traffic infrastructure on the coast.

“With the support of the Montenegrin government and the embassy of China, we will continue to take advantage of technological advantages in order to finish the project with quality within the deadline,” Yao Lu said.

In December 2019, BIRN published an interactive map in which 135 Chinese-linked projects in the Balkans worth more than 32 billion euros were identified.

In May 2022, a BIRN investigation showed a lack of transparency in the Chinese company’s involvement in a 20-million-euro contract to lay tram lines in the Bosnian capital, Sarajevo.

In June 2021 the authorities in Bosnia’s Sarajevo Canton awarded the contract to a consortium of China Shandong International Economic & Technical Cooperation Group and China Railway No.10 Engineering Group Co, but the Sarajevo authorities refused to provide BIRN access to the contract and tender documentation.

In 2018, China’s Shandong signed a contract to build a highway between Banja Luka and Prijedor in the Republika Srpska entity in Bosnia. Work began in November 2021 but the Republika Srpska authorities said details of the deal would not be made public unless the company allowed it.

In September 2022, the Republika Srpska government signed a Memorandum of Understanding with the Shandong group to cooperate on a project to build an expressway from Bijeljina to Sokolac worth 1.3 billion euros.

In July 2022, Montenegro opened the first section of the Bar Boljare highway, seven years after the Chinese-financed project started and which drove up Montenegro’s public debt to 90.85 per cent of GDP. The first 41-kilometre-long phase was built by the Chinese Road and Bridge Corporation, CRBC. It was 85-per-cent financed by an $810-million-loan from China’s Exim Bank.

Besides the highway, Montenegro has also turned to China for help with the purchase of two Chinese-made bulk carriers for 41.9 million euros in January 2010. The country bought two more in 2012.

Chinese companies have also been involved in upgrading the railways in Montenegro, refurbishing the country’s only coal-fired power plant in Pljevlja and in procuring vaccines against COVID-19.

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