Fortune News | Jun 27,2020
July 25 , 2020
By BEMENET WONDEWOSSEN
The long-delayed Neqemte-Bure road project was awarded to a Chinese company after the contract was terminated from IITNL-Elsamex Neqemte-Bure JV - a joint venture of IL & FS Transportation Networks and Elsamex S.A., a Spanish firm.
Covering 260Km, the road that connects Neqemte with Bure in Gojjam has been underway after being divided into three lots since 2016 with a loan from the World Bank Group. The first and third lots of the project were awarded to IITNL-Elsamex Neqemte-Bure, while JMC Project India Limited secured the second lot.
While IITNL-Elsamex Neqemte-Bure's part of the project got stuck, JMC was able to complete 75pc of the 87.7Km road that extends from Andhode to Agamsa. This segment is expected to be finalised by December. The Neqemte-Bure road project is one of the beneficiary projects from the 320-million-dollar loan the World Bank gave to Ethiopia in 2014.
The Neqemte-Bure gravel road, which is set to be upgraded, was built three and a half decades ago with a loan secured from the World Bank. The project had also included one of the largest bridges in East Africa at the time.
After terminating the contract that was given to IITNL-Elsamex Neqemte-Bure JV, the Ethiopian Roads Authority (ERA) awarded it to Chongqing International Construction Corporation last week to construct 171Km of the road for 3.4 billion Br. The company is expected to deliver the project in three years.
The agreement signed between the Authority and the Chinese company is a delivery output performance agreement. With the arrangement, Chongqing International will be responsible for maintaining the road for five years after the delivery of the contract.
Chongqing International, which is a subsidiary of Chongqing Foreign Trade & Economic Cooperation Group, will build the first segment of the road that extends from Neqemte to Endehode covering 86.4Km for 1.7 billion Br. The 86.5Km second project extending from Agamsa to Bure will be built for 1.77 billion Br.
Before the contract with IL & FS Transportation was terminated, the company had abandoned the project without progressing much and left the country after declaring bankruptcy.
Angry local employees in Neqemte, Bure and Woliso towns in Oromia and Amhara regional states protested over unpaid salaries and took seven Indian employees of the company hostage after demanding pay. Later, following negotiations between the two countries, the employees were set free and returned to India.
The Neqemte-Bure road is among the 12 road projects the Authority awarded to 10 companies last week. The roads that have total coverage of 825.2Km will cost 19.9 billion Br. Out of the awarded companies, six are local firms.
FAL General Contractor, Amhara Road Works Enterprise, Ethiopian Construction Works Corporation, Samson Chernet General Contractor, Kibish Construction and a joint venture between Powercon Plc and Aser Construction are the local companies that secured contracts. Chongqing, Shandong Luqiao Group, Jiangxi the Second and China Wu Yi are the Chinese firms that were awarded five projects.
The local and the foreign companies have three and six months for mobilisation, respectively, according to Habtamu Tegegne, the director-general of the Authority.
For the current fiscal year, the government has allocated 58 billion Br for the construction of road projects at a national level. The value is 38pc higher than the previous fiscal year's budget.
PUBLISHED ON
Jul 25,2020 [ VOL
21 , NO
1056]
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