Friday, May 31, 2013

globalpost: Romania spikes Bechtel motorway deal

Romania cancelled a controversial deal with US giant Bechtel on the construction of a motorway plagued by problems since it was first signed in 2003, the government said Thursday.

Bucharest will pay Bechtel 37,2 million euros ($48.5 million) in compensation and reimburse debts worth 50 million euros ($65.2 million), the minister in charge of infrastructure projects Dan Sova said.

Romania had granted the 2.2-billion-euro ($2.8 billion) contract to the American company in 2003 without a tender, angering the European Commission.

The company was to build a 415-kilometre motorway between Brasov and Bors, near the Hungarian border.

But 10 years on, only 52 kilometres have been completed, while Bechtel has cashed in some 1.4 billion euros.

Romanian authorities had already cancelled part of the deal in 2011, when Bechtel was left with only two out of eight segments to continue work on.

The American company had several times brought works to a halt and laid off most of its local employees, accusing the government of failing to pay its debts.

No comments: