Attiki Odos builders ask to undertake the extension

The first day of the Economist Conference on Public-Private Partnerships (PPPs) had plenty of interesting moments, but none more interesting than when Dimitris Koutras, chairman of construction company Aktor, called for the contracts for the extension of Attiki Odos, the highway skirting northern Athens and linking the capital to the airport, to be directly awarded to the consortium that has built it so far and is now operating it. The five extensions – the link between the Attiki Odos and the port of Rafina; the link with coastal Poseidonos Avenue, through a tunnel in Mt Hymettus; the link with Vouliagmenis Avenue; the extension of Kymis Avenue, which starts near the Olympic Stadium, to the Athens-Lamia National Highway; and the extension of Attiki Odos to the port of Lavrion – had been planned by the previous Socialist government. The tender for the projects, worth hundreds of millions of euros, had been called in 2001 and four bidding consortiums had been short-listed. However, the previous government postponed indefinitely the Kymis Avenue extension, which would have further shortened the drive between the Olympic Village and the Olympic Stadium, citing escalating costs. The new government, which came to power 19 months ago, five months ahead of the start of last year’s Athens Olympics, has frozen the rest of the project, citing the need to give priority to infrastructure projects outside Attica. Officials at the Ministry of Environment and Public Works said yesterday there had been no official request from the Attiki Odos consortium to complete the rest of the project. However, the government’s decision not to proceed, for the moment, with the existing tender, is making such proposals increasingly attractive. The proposal Koutras proposed, specifically, that the Attiki Odos consortium, where the Hellenic Technodomiki-TEV-Aktor construction group is the majority holder, undertake to build the five extensions, using its own money, provided that the state agrees to extend the group’s right to operate the highway, granted for 18 years, by five more years. Drivers will be paying the same amount for tolls as on the present stretch of the highway (2.50 euros for passenger cars). Engineers familiar with the projects said that, if the consortium was awarded the extensions, «the goose that lays the golden egg will become a goldmine.» He pointed out that several new toll stations would significantly boost the consortium’s revenue and that the proposal does not come cost-free for the state because it would undertake the cost of property expropriations, which will reach dozens of millions of euros. The ministry officials conceded that the Attiki Odos’s consortium is not only enticing but also close to a one-way street. Members of the consortium were among the four short-listed bidders in the 2001 tender and they have the advantage of being able to offer a single toll rate. For example, if another company or consortium were to be awarded the extension to Lavrion, drivers would pay tolls twice, once to get to Attiki Odos and the second time to use the extension. PPP opportunities Environment and Public Works Minister Giorgos Souflias told conference participants that two of the next PPP projects, the Ionian Highway and the Corinth-Kalamata Highway, will begin soon; binding bids are expected by mid-December. For two other highways, bids will be submitted by April 2006. The president of Olympic Properties, Christos Hadjiemmanuil, said the successful application of PPPs requires a thorough overhaul in the operations of the state, including the judicial system. Foreign speakers from countries with PPP experience said that the main elements for a successful operation are the standardization of contracts, training of civil servants and the introduction of small pilot projects that will allow a gradual spread of know-how.