Montenegro’s government has announced plans to cooperate with US company Bechtel on the construction of the Adriatic-Ionian highway.
The highway will be the first collaboration between the Montenegrin government and Bechtel under a Memorandum of Understanding for developing road, rail, aviation, port, agricultural, defense, and infrastructural projects. The government announced it would be signed in the coming weeks.
Finance Minister Milojko Spajic said the highway will be built in line with all EU and NATO standards. He added that the MoU will form the basis of all necessary agreements and specifications for planned investments in Montenegrin infrastructure.
The Adriatic-Ionian highway, also known as the Blue Corridor will stretch from Italy to Greece through Slovenia, Croatia, Bosnia and Herzegovina, Montenegro and Albania.
Montenegro Strikes Deal to Prevent Defaulting on Chinese “Debt Trap”
The Montenegrin government got itself into hot water with foreign investment after it struck a deal with China to build a new road that remains unfinished. China financed the project but when Montenegro couldn’t pay the first repayment, they risked losing a slice of territory.
Three banks stepped in to help the country after the EU refused to help.
Minister of Finance Milojko Spajic said that a deal was made on July 8th with two unnamed US banks and one French bank. He said it wasn’t a “classic replacement” of the Chinese loan but significantly reduced interest rates.
The money owed to China is equivalent to around 25% of the country’s entire debt. In 2020, this reached a staggering 103% of the GDP.
Bechtel have signed an agreement with the Albanian government to construct the Skavica hydropower plant on the Black Drin River in the north-east of Albania.
In the next 18 months, Bechtel will complete all the necessary studies – environmental, geological, social impact studies – before the actual construction starts, for which a second agreement will be signed.
The construction of the Skavica HPP will add 210 megawatt or 20 percent of renewable energy production, and reduce to a minimum the usual flooding of whole areas during rainy seasons around Shkoder city. The Skavica HPP is Albania’s most strategic energy project, and its most important water reservoir, holding about 7 billion cubic meters. This makes it the largest reservoir in Europe.
