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Slovakia's freeway program revs up for 1998

On February 13, Prime Minister Vladimír Mečiar cut the ribbon on Slovakia's two newest freeways - the 14.2 kilometer D2, linking Bratislava to the Hungarian border, and the 2.6 kilometer D61, wedding the Slovak capital to its Austrian neighbour. In terms of road infrastructure, if not in any other way, Slovakia is set to take big steps in 1998 towards integration with Europe.
Those closer freeway ties, however, will cost Slovakia an estimated total of 229 billion Sk ($6.5 billion) by 2005, the date set for the completion of the roads project. Much of this sum will come from foreign loans guaranteed by the government, while a large part of the rest will be defrayed by a system of road tolls administered by a private company.

On February 13, Prime Minister Vladimír Mečiar cut the ribbon on Slovakia's two newest freeways - the 14.2 kilometer D2, linking Bratislava to the Hungarian border, and the 2.6 kilometer D61, wedding the Slovak capital to its Austrian neighbour. In terms of road infrastructure, if not in any other way, Slovakia is set to take big steps in 1998 towards integration with Europe.

Those closer freeway ties, however, will cost Slovakia an estimated total of 229 billion Sk ($6.5 billion) by 2005, the date set for the completion of the roads project. Much of this sum will come from foreign loans guaranteed by the government, while a large part of the rest will be defrayed by a system of road tolls administered by a private company.

The current plan for financing new freeways faces two principal dangers, say financial analysts. First, by using short-term debt to fund costly infrastructure projects, the government may end up destabilizing the economy. Secondly, by charging tolls on the new freeways, the state may encourage citizens to travel by existing non-toll highways and thereby endanger the revenue it is counting on to cover construction costs.

State investment into freeway construction is set to increase this year, from 14 billion Sk in 1997 to 16.5 billion Sk in 1998. According to Ján Záhradník, director of the Investment Branch of the Slovak Road Administration (SSC), "the state will provide [the State Road Economy Fund with] 4.5 bn Sk for the repayment of the interest and principals on loans [from 1995] this year, while as for highway construction, the plan is to invest approximately 11 bn Sk [through the SSC] in 1998. This money will come from foreign loans." According to financial sector analysts, these credits will be extended by the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB) and the Japanese Nomura bank, among others.

Záhradník said that the SSC was planning to open another 100 kilometers of freeway in Slovakia in 1998, adding to the 215 kilometers that existed at the end of 1997 (please see map, this page). Much of the new construction, he explained, was to occur between Bratislava and Žilina, and then Žilina and the Polish border, creating a north-south traffic corridor that was scheduled to be in use by the summer of 1999.

But Slovakia's soaring mountains and deep valleys, while a blessing to tourism, are a curse to highway construction. "The sections from Žilina to Ružomberok, and from Žilina to the Polish border are difficult projects," Záhradník explained, "and that is reflected in their price. Usually one kilometer of highway costs us 200 million Sk but in these section it costs us more than 350 million Sk."

Váhostav a.s., the company doing the Žilina-area freeway construction, confirmed that rough terrain had raised costs. Juraj Škorvánek, the company's director of pre-construction operations, said that "the whole [1998 Žilina region project] will involve about 8.1 km of highway, known as the D18. We will have to build 15 bridges in this distance, which in some parts means that more than half the road is bridges. The terrain is very precipitous, and we do our construction like mountain goats."

Figures supplied by Váhostav indicated that construction costs may take even the SSC by surprise. The company's 3.4 km D1 project, from Čadca to Oščadnica, will cost an estimated 117.3 million Sk per kilometer (mil.Sk/Km), but the 3.2 km Skalité-Polish border connection will run 394.6 mil.Sk/km, while the 1.4 km Čadca town bypass will take a whopping 576 mil.Sk/Km to build.

"The major problem [of freeway construction in Slovakia] will be to collect enough funds," said Dušan Šamudovsky, General Director of Dopravoprojekt a.s., the Bratislava engineering company that is designing Slovakia's new freeways. "We have already seen some slowdown in roadway construction because of lack of money," he observed, adding that the future was equally insecure. "The Ministry of Transport and the SSC are preparing a toll program [to be operated by a concession company], but it will be difficult to get Slovaks to pay twice for freeways [through state taxes and toll rates]," he said. Although negotiations with concession operators are "only in the very early stages," according to Záhradník, preliminary estimates suggested that tolls would take effect in 2001, and charge cars .80 Sk per kilometer and trucks 2.60 Sk.

Future unsure

Záhradník explained that Slovakia's freeway program had begun with a 300 million Sk investment in 1994, and had been conceived in concert with a pan-European freeway plan approved by a conference of transport ministers from European countries. "The Helsinki conference approved our plan to open two freeway corridors - one from the south up to the Polish border, and the other from the west to the Ukraine border in the east," he said.

The original time frame set for the completion of the entire project, Záhradník explained, had been 2005, a date he now considered unlikely. "We are still planning on 2005," he said, "but it will largely depend on financing, and the will of future governments to secure it. Perhaps 2010 is more realistic, especially since pressure to finish the east-west corridor will not be as great as that for the north-south route, because of lower traffic levels."

Šamudovsky agreed. "Un-fortunately, motorways development in any country gets caught up in political issues, just like in Slovakia. Every voter has a car, and probably wants better highways, so the government wants to present this in the most optimistic light. But 2005 is probably unrealistic, and if you take into account our rising debt burden, it's even less realistic."

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