The Montenegrin highway leads into a debt trap towards China

Montenegro almost reached national bankruptcy due to an ambitious large-scale project. The first section is now open, writes the Rhenische Post.

"Passengers in the hilly north of Montenegro no longer have to fear driving through the "Montenegro gorge of death". With a three-year delay, this country, a candidate for admission to the EU, can now finally open the so-called Chinese highway: more than a billion euros were spent on the construction of the first, 4.1 km long section from the port of Bar to Serbia. The new highway is "the beginning of a permanent connection between Montenegro and the world," Prime Minister Dritan Abazović said at the opening, writes the Rheinische Post.

The paper writes that, first of all, for residents of inaccessible parts of the country, but also for tourists from Serbia, this highway represents an enormous relief, including saving time.

"The joy over the completion of the first phase of construction is, however, overshadowed by concerns about high costs. Because of the prestigious project, the small country was almost on the verge of bankruptcy and almost fell into the Chinese debt trap. The appeal of then Deputy Prime Minister Dritan Abazović to the European Parliament in the spring of 2021 to help Montenegro refinance its loans "so that we can stop Chinese influence" sounded like a cry for help.

EU hesitation

"The Chinese Exim Bank made available a loan in the amount of almost one billion dollars with apparently uncomplicated and generous conditions: the first installment was to be paid only in the summer of 2021 after the completion of the section, which was originally planned for 2019," the newspaper writes. and states that, however, the corona pandemic led not only to a delay in construction work, but also caused this country, which is highly dependent on tourism, to slide into a deep financial and economic crisis.

"Brussels initially showed reservations about Montenegro's requests for help, but eventually helped to conclude a more favorable credit arrangement with Deutsche Bank, the French Société Générale and two American banks. In August 2021, Montenegro still managed to pay the first installment of more than 60 million US dollars and also the second installment at the beginning of the year. Despite the debt restructuring, this EU candidate country will have to carry the burden of its debt to China for a long time," concludes the Rhenische Post.