New Highway Loan Causes Unease in Croatia

Croatia's government on Thursday agreed to guarantee a 200-million-euro loan from the European Bank for Reconstruction and Development, EBRD, to finance the indebted highways.

Croatian Highways, HAC, the company managing most state-owned highways, needs new cash to cover previous loans, mostly taken out for the construction of highways.

A government attempt to offload the highways through concessions failed in April, after the constitutional court ruled that the government would have to put the issue to a referendum.

Since then, the government has had to explore new ways to refinance the debts run up by HAC and by the second company managing the highways, the Rijeka-Zagreb Highway, ARZ.

The bank loan is also being given on condition that the government goes ahead with the reconstruction of HAC and offers some of its shares on the market.

In 2016 alone, HAC needs to repay 575 million euro in loans. The failed concession was expected to bring in some 3 billion euro for a concession lasting between 30 and 40 years.

Mijat Stanic, head of the Roads Union and leader of the civil initiative opposing the concession plan, told BIRN that refinancing the debts of the state highway companies is "necessary and welcome.

"The only thing in this government's decision, the condition given by the bank... is the privatization of the operator [HAC]. I don't know what this means... If it means selling the company, than again it should be done through a referendum," he said.

Stanic led a group of unions and NGOs that petitioned for a referendum against the concession of highways, claiming that the highways were public assets and should be run by state companies, partly because privatisation would mean higher prices for tolls.

The...

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