Frankfurter Algemajne Cajtung Writes: The 177-kilometer Highway That Almost Destroyed Montenegro

Frankfurter Algemajne Cajtung Writes: The 177-kilometer Highway That Almost Destroyed Montenegro A highway project in Montenegro, initially financed by a Chinese loan, nearly led the country to financial ruin due to high costs and delayed completion. The situation was improved through a deal with European and American banks, but the principal repayment still burdens the country. Construction is now continuing with European funding, involving Chinese companies, which represents a significant shift in policy from the EU.

• Montenegro’s highway project, initiated in 2014, was partially funded by a Chinese loan that led to a significant increase in the country’s debt.
• The project, initially undertaken by China Road and Bridge Corporation (CRBC), faced delays and cost overruns, causing budget problems for Montenegro.
• A deal with European and American banks reduced interest rates, but the principal repayment remains a burden.
• The EU is now subsidizing further construction with 150 million euros, and the European Bank for Reconstruction and Development is providing a 200 million euro loan.
• Chinese firms, such as Powerchina, are still involved in construction, despite the shift in funding.
• Critics in Montenegro refer to the project as ‘a road to nowhere,’ while authorities see it as a development stimulus.
• The involvement of Chinese firms in European-funded projects is not unique, as seen in the case of Croatia’s Pelješac Bridge.