The Banja Luka court ordered the Government of the RS for the fourth time to publish the highway contract with the Chinese

 

This is the fourth judgment handed down by this court.

 

The judgment was passed following a lawsuit filed by the Center for the Environment from Banja Luka, which also submitted the previous two, which were not implemented.

 

In addition to the Center for the Environment, the District Court also ruled in favor of Transparency International BiH in October 2022.

 

The Ministry of Transport and Communications of the Republic of Srpska refused in all cases to provide details of the contract with the Chinese company.

 

"The position of the District Court in Banja Luka is unequivocal - the concession contract is a matter of public interest, which as such must be accessible and transparent to citizens," said Tihomir Dakić, president of the Center for the Environment, on February 5.

 

The RS government signed a concession agreement in December 2018 with the company "SDHS-CSI BH", which is registered in Banja Luka as a representative office of the Chinese company "China Shandong International Economic and Technical Cooperation Group".

 

The contract envisages the construction of a highway about 40 kilometers long, worth about 300 million euros.

 

The government of the RS has so far refused all requests to disclose all the details of the contract, with the explanation that "the Chinese side does not allow it".

From the Center for the Environment, they state that on December 22, 2023, the Government of the RS reached the conclusion that the Ministry of Transport and Communications of the RS should publish the contract, but without Annex no. 23.

 

"That attachment constitutes the financial model of the project for the construction and commissioning of the Banja Luka-Prijedor highway, which renders the publication of this contract completely meaningless," said Dakić.

 

He stated, among other things, that they are waiting for the submission of the Economic Justification Study for the construction of that highway.

 

 

What is known to the public so far is that the Chinese company will earn about 975 million euros from the 300 million euros invested during the 30-year concession.

 

The opposition states that it is disputed that the Republika Srpska gave guarantees about the number of vehicles on this section of the highway that should pay tolls.

 

Given that the Chinese investor expects 30 million euros per year from tolls, Republika Srpska would pay the difference between the collected tolls and that amount.

 

The beginning of the construction of the Banja Luka - Prijedor highway was made official in November 2021.

 

At the ceremony attended by representatives of the Government of Republika Srpska and Chinese investors, it was announced that the works will be completed within three years, and that at the end of 2024, Banja Luka and Prijedor will be connected by a modern highway.

 

The Minister of Transport and Communications of the Republika Srpska Nedeljko Čubrilović said in November last year that the completion of the works is expected in the spring of 2026.

 

The Chinese company "China Shandong International Economic and Technical Cooperation Group" was also involved in the construction of highways in Serbia.

 

CONCLUSION

The refusal of the Ministry of Transport and Communications of the Republika Srpska to comply with the (fourth in a row) court ruling to disclose details of the concession agreement for the construction of the Banja Luka - Prijedor highway, concluded by the Government of Republika Srpska with the Chinese company "SDHS-CSI BH", in this case, illustrates the lack of transparency in the operations of Chinese companies. The Ministry's justification that the "Chinese side" is not in favor of disclosing the details of the contract (despite the court ruling) directly indicates the likelihood that the disputed contract contains provisions that are either contrary to the law or may indicate corruption.

The published data that the Chinese company, with an investment of around 300 million euros over the 30-year duration of the concession agreement, will earn around 975 million euros from tolls, while the Government of the RS (i.e., the citizens, as the RS Government only manages the budget, which is the citizens' funds) will ensure that the concessionaire collects 30 million euros in tolls each year, regardless of the number of vehicles from which tolls are collected.

All this is yet another alarm for additional caution when it comes to contracts with Chinese investors, not only for government representatives but also for companies potentially considering joint ventures with Chinese companies.