Fortune News | Aug 15,2022
Habtamu Tegegne, director-general of the Ethiopian Roads Administration, has requested the World Bank for a 15-month extension to complete a section of the Modjo-Hawassa Expressway connecting Batu (Ziway) and Arsi Negele towns. Filed through the Ministry of Finance, it is the second request in less than a year.
The World Bank approved the disbursement of 370 million dollars in credit for building the 57Km toll road that connects the two towns. The segment was initially scheduled for completion in December 2021. However, Habtamu requested the Bank a nine-month extension. The approving nod for the extension came at a cost, as the World Bank downsized its original credit commitment by a quarter to 295 million dollars. It has thus far disbursed 86 million dollars.
Representatives of the World Bank were unavailable for comment.
The 202Km Modjo-Hawassa Expressway was launched in 2016, separated into four segments. The first lot from Modjo to Meqi was completed last year by the state-owned China Railway Engineering Corporation (CREC) for 126 million dollars. It was financed by a loan from the African Development Bank (AfDB). South Korea's Export-Import Bank financed the second lot, connecting Meqi with Batu with an outlay of 228 million dollars. The road from Modjo to Batu was opened for traffic in mid-September 2021.
Although the contractor, SBI International Holdings AG, was awarded the Batu-Arsi Negele project in 2018, construction did not begin until last year due to pushback from landholders, including farmsteads. Close to 1,000 farmers have been displaced by the construction of the Batu-Arsi Negele road project. The Roads Administration has paid 1.9 billion Br in compensation to owners who surrendered properties. A little over 3,400 farmers have been affected by the Expressway project.
Officials blame right-of-way issues for the delays. Rights of way are common and major causes of delays, especially on federal projects implemented in regional states, according to Bezabih Amdo, a civil engineer with more than 20 years of experience. He says regional and local authorities are better suited than the federal government to manage relocations and compensations.
"Farmers see local administrators in good faith than federal officials who don't know much about the local culture," Bezabih argues.
The Batu-Arsi Negele project was less than a third of the road built by January this year. It has since reached 43pc completion, according to Addishiwot Tadesse, project team leader.
"The remaining work won't take much time," he said.
If the World Bank approves Habtamu's second request, the credit extension period will spread to 24 months. He wants to see the deadline pushed back to December 2023.
Habtamu was appointed to head the Ethiopian Roads Administration (then Authority) four years ago. It is the federal agency in charge of road projects valued in the tens of billions of Birr, awarding contracts, and supervising roadworks. He had served as the head of the Addis Abeba City Roads Authority for two years before taking the helm at the Administration from Araya Girmay in 2018. The Modjo-Hawassa Expressway is the largest project under his supervision.
The construction of the fourth and final lot from Arsi Negele to Hawassa is also in jeopardy. The Export-Import Bank of China is financing the lot with 196 million dollars in credit. However, the Bank has withheld the disbursement of 339 million dollars as it reviews Ethiopia's debt status. The road project is among eight facing similar delays.
An intelligent transportation system (ITS) that monitors tolling on the Expressway is part of the project. It is designed to integrate toll collection systems, monitor vehicle speed, camera surveillance, and detect accidents. The federal government will finance the ITS and toll installations. Facilities, administrative buildings and management centres are under installation for the Expressway's first and second lots, with the federal government covering the cost.
Officials expect the installation to be completed in December next year.
The Roads Administration is expected to float the bid for ITS along the third and fourth lots of the Modjo-Hawassa corridor, which is currently under revision.
"Although the project duration is tight, we'll complete it according to schedule," said Yetemgeta Asrat, the deputy head.
The deadline for the installation is set for October 2024.
The Ethiopian Toll Roads Enterprise is in charge of the toll stations on the Addis-Adama Expressway, the first toll road in the country, which opened for traffic seven years ago. The construction was financed by a 350 million dollar loan from the Export-Import Bank of China and 26 million dollars from the federal government.
PUBLISHED ON Jul 17,2022 [ VOL 23 , NO 1159]
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