Another loan is added to the Albanian tax payers. 25 million USD were
accorded from the Saudi Development Fund, which accepted the
government’s request for financing the Tirana-Elbasan highway, a project
that is considered as very important, after the Durres-Kukes one.
The confirmation for the loan came yesterday, during a meeting between the Albanian Minister of Finances, Ridvan Bode, and Saudi Arabia ambassador in Tirana, Abdulldah Abdulaziz Al-Abdulkarim.
The Finance Ministry, according to “Shqip” newspaper, announced that the loan has an interest rate of 2% and a 25 year long maturity term, the first five years of which are free of charge.
The loan of 93.750.000 Rial (25 mln USD) for the Tirana-Elbasan highway are added to the other loan that the Albanian government took from Arab Banks (222 mln USD from Islamic Development Bank). In total, the 31.7 km long road, with two 4 km long tunnels, is expected to cost over 350 mln USD. Up to now, the government has been able to secure 250 mln USD, together with the loans.
The ambassador of Saudi Arabia Kingdom underlined that the approval of this loan is based on the consolidation of the good relations that exist between both countries, in the efforts for developing the Republic of Albania.
It was agreed that the remaining part of the cost would be provided by other financial institutions of the Arab world, through a protocol that was signed this January by the Albanian government. More than 90% of the road will be built thanks to the support of the Arab banks, such as IDB, Kuwaiti Fund, Abu Dhabi Fund, OPEC, Saudi Development Fund, and the remaining part will be provided by the Albanian government, which has started to pay the private companies that are waiting the agreement.
The Economy Parliamentary Commission approved some days ago the draft-law that provided the ratification of the agreement between the Albanian government and IDB.
The Tirana-Elbasan highway will be built from scratch, and it goes through new territories. The project compiled by two Italian companies provides three divided segments, including the tunnel near Kerraba Mountain. For this tunnel there have been made special studies and analyzes. Due to its great importance, the Albanian government contracted an Italian company only for supervising the 2.3 long tunnel. Kerraba tunnel is divided in two ways, for the realization of which was contracted the Greek company “Aktor” for 85 mln USD, a sum that was completely covered by the Islamic Development Bank.
The Abu Dhabi Fund has agreed to offer 100 mln USD. The parties have approved the agreement in principle, but there are many details that remain to be realized. The two other funds, the Saudi Fund and OPEC Fund, after some negotiations with our Ministry of Finances, agreed to loan 25 mln USD each, one of which was realized yesterday by the Saudi Ambassador.
IDB agreed that the 223 mln USD loan would have an interest of 5% and a 20 year term. The first installments will start to be paid three years after the construction.
The Albanians are facing another debt that goes at least 400 mln USD. According to financial data, compared to 2006, the foreign debt has been doubled and has reached more than 2.7 billion USD. The greatest part of the foreign loans that have been taken in the last two years, were in the form of commercial loans. Only in the past two years, the interest of the foreign debt has increased with more than 2.5 times: from 29 mln USD that it was in 2008, to 73 mln USD in 2010.
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