1. “Hard Hills”

Montenegro is located in the southeast of the continent. It covers an area of 13,812 km2. The total population of Montenegro, according to the census of 2011, was 620,029. It borders with Albania to the south (border length 172 km), then Serbia in the east and north-east (border length 203 km), Bosnia and Herzegovina in the north (border length 225 km) and Croatia in the northwest (border length 14 km). Montenegro borders with the Adriatic Sea and has a 293.5 kilometers long coastline. Across the Adriatic Sea, to the Italian coast, there are approximately 120 nautical miles

Geographically Montenegro can be divided into three regions:

  1. Coastal region that includes the Adriatic Sea coastline to the high mountains of Orjen, Lovcen and Rumija, with Mediterranean climate. This region includes the municipalities of Herceg Novi, Kotor, Tivat, Budva, Bar and Ulcinj. It covers about 11.5% of the total area of Montenegro, with approximately 23% of the population. This region includes all port facilities, railway junction in Bar and Tivat airport. The main road is the Adriatic highway which connects all the cities in the region.
  2. Central region, which includes the area bordering on the mountains of Orjen, Lovcen and Rumija in the south west and high mountain ranges of Durmitor, Bjelasica, Komovi and Prokletije in the northeast and east. It has a continental climate in the lower regions and mountain climate on the outskirts. In the lower regions it occasionally snows, and the snow stays for a short period of time, while in a higher area, it stays for more than 4 months a year. It includes the cities of Podgorica, Cetinje, Danilovgrad and Niksic. This region covers about 35% of the total area of Montenegro and it has about 45% of the population. This region includes Podgorica airport, which has a very good geographical position. Podgorica is the capital and also the main rail and road junction.
  3. North region consists of areas of mountain massif of Durmitor, Bjelasica, Komovi and Prokletije. It has a mountain climate with mild summers and cold, harsh winters. Snow lingers longer than 4 months per year. It includes the cities of Bijelo Polje, Pluzine, Savnik, Zabljak, Pljevlja, Mojkovac, Rozaje, Berane, Kolasin, Andrijevica and Plav. 32% of the population lives at about 53.5% of the total area of Montenegro.

Montenegro has a diverse relief, which consists of high mountain massifs (Orjen, Lovcen, Rumija, Bjelasica, Komovi, Durmitor, Prokletije, etc.), valleys (Zeta, Grbaljska, Bjelopavlicka, etc.) intersected with many rivers which make canyons (Moraca, Lim, Tara, Cehotina, etc.). Such relief and influence of climatic factors is extremely unfavorable for the construction and maintenance of transport infrastructure in particular. If the fact that over 55% of the total area of Montenegro is at over 1,000m above sea level, and that about 24% of the total area of Montenegro is situated on a slope greater than 30% is added to this, it results in an extremely complex and difficult framework for the construction and maintenance of transport infrastructure.

The road network in Montenegro consists of state roads (main and regional) and municipal roads (local roads and streets in residential areas). Main and regional roads in Montenegro are 1782.8 kilometers long. This includes 931.9 km of main roads, and 850.9 km of regional roads. Municipal roads are 4570 kilometers long. The density of main roads and regional roads is 13 km per 100 km2. Over 66% of regional and main roads are older than 25 years, and the total value of regional and main roads is estimated at around €2.6 billion. In 2015, in Montenegro there were 198,772 registered vehicles, of which 88.5% passenger cars. Physical characteristics of most main roads and regional roads (unstable slopes, lack of shoulders, small radius of horizontal curves, large longitudinal gradients, relatively high level of damages to the pavement) limited the average speed to less than 50 kilometers per hour, and also contributed to the increase in costs for road users, thereby reducing Montenegro’s comparative advantage in relation to other transit corridors, and slowing overall economic development.

The existing road route Bar – Podgorica – Kolasin – Bridge Bar in Montenegro is an important transport corridor at the national level. Extending from one end to the other of its territory, it spatially and functionally integrates gravitating spatial units (settlements, natural and economic resources) in its wider hinterland, since there are not many alternative national road network routes in this part of the territory.

The total length of the existing roads is about 180 km. Most of the route (approximately 75%) is mountainous, and sections north of Podgorica have been constructed and are exploited in very complex environmental conditions. They include a large number of road structures (bridges, tunnels, galleries) and represent a relatively serious task for drivers in terms of transport security. The road was built 50 years ago by the standards in force in the former Yugoslavia. The design speed of movement on this road varies depending on the road section, from 30 km/h (in the harsh mountain conditions) to 70 km /h on other sections.

The road passes through mountain ranges. The first is on the road section between Petrovac and Podgorica, and the difference in level is over 650m (from 30m to 700m). On the road section from Tanki rt to Smokovac, through Podgorica, the road passes through flat fields for over 30 km. The second mountain range is between Smokovac and virtually extends to the Bar bridge on the border with Serbia. At this road section, elevation difference exceeds 1,000m (from 22m to 1.045m). Roadway is designed for axle load of 10t, which is not enough for heavy-duty trucks today. Unfortunately, in many places, cuts and embankments are not protected and slide due to erosion. All intersections are made according to the standards of the former Yugoslavia in the 1950s or 1960s and are now very dangerous considering the huge traffic flow of fast vehicles. Number of traffic accidents on the existing road is great. Overall, the basic issues from the standpoint of security are as follows:

  1. Difficulties associated with typical mountain roads:
    – Inadequate radius of curvature;
    – Steep gradients, without the slow lane;
    – Insufficient opportunities for overtaking;
    – Inadequate security barriers;
    – Inadequate bus stops;
    – Dangerous unstable slopes;
  2. Atmospheric conditions are often poor, making it difficult to drive:
    – Inadequate lighting;
  3. Combined traffic of fast modern and ancient old vehicles;
  4.  High participation of trucks in the day and night traffic:
    – Traffic congestion in the busiest hours;
    – Long journey;
    – A large number of connections with private land parcels, which slows traffic down;
    – A large number of level junctions – i.e. the presence of a large number of junctions;
    – High speed in built-up areas;
    – Lack of zones for safe stopping along the road;
    – Conflicts between the movement of vehicles and pedestrians.

 

2. Recognition of strategic importance of the Bar-Boljare hightway

For the first time highways were mentioned in the planning documents in the Regional Spatial Plan Southern Adriatic (1969). The future highway was envisaged along the direction Belgrade – Bijelo Polje – Bar, and a highway from Split via Trebinje to Albania, passing through the territory of Montenegro.

The first spatial plan for the territory of Montenegro was adopted in 1986, and it was amended on two occasions, in 1990 and 1997.

Spatial Plan of the Republic of Montenegro to 2000 (1986) specified, for the first time, general basis for the organization and spatial development of the Republic as a whole. Spatial concept of long-term development of transport infrastructure was defined as well, through anticipated improvement of relations between the Republic and economic territory of the country (former Yugoslavia), regional and inter-municipal connections and local accessibility, treated as one of the key preconditions for achieving the goals of development set by the Plan, especially in relation to more balanced regional development. The plan covers a network of roads by 2000, in addition to the network beyond the planned period.

For the period to 2000, the basic network consisted of a transversal and three main longitudinal directions, which, branching out from the transverse, connected the Coastal, Central and Northern regions of the Republic. In the Central region it is planned to complete the longitudinal main road connection from the Albanian border to Titograd and Niksic, which branched in two directions in Niksic: Niksic – Pluzine – Scepan Polje, which is an absolute priority in the construction of roads in Montenegro, and the leg Niksic – Trebinje – Dubrovnik. The Plan estimated that by 2000, from the standpoint of traffic load, there would be no need for a highway in Montenegro, which could occur later, and only in the event that only one longitudinal corridor remained (Titograd – Matesevo ​​and beyond), i.e. to postpone the opening of a new corridor in the direction of the Coast – Niksic – Pljevlja and beyond. Also, it was estimated that the longitudinal direction of Trebinje – Niksic – Titograd – Albanian border could become part of the Adriatic highway, once planned (1969) under the South Adriatic project.

Spatial Plan of the Republic of Montenegro until 2000 (as amended in 1990), with the exception of main and regional roads, included highways and so-called roads for fast motor traffic on the coast. The following directions were planned as highways:

  1. Adriatic highway (Debeli Brijeg – slopes above Herceg Novi – Cevo – Titograd (Podgorica) – Western bypass around Titograd);
  2. Highway Belgrade – Montenegrin coast;
  3. Highway Titograd (Podgorica) – Skadar.

Spatial Plan of the Republic of Montenegro until 2000 (amended in 1997), from the standpoint of road transport, fully assumed solutions for the locations of future highway from earlier amendments to the Spatial Plan of the Republic of Montenegro (1990). The following directions were planned as highways:

  1. Adriatic highway: Debeli Brijeg – slopes above Herceg Novi – Cevo – Titograd – Western bypass around Titograd – Smokovac. From Titograd to Matesevo, two corridors were planned, namely:
    Basic: Smokovac – Kuci – Verusa – Matesevo;
    Alternative: Smokovac – Bratonozici – Verusa – Matesevo,
    with the obligation of further route investigation under the same technical and traffic-exploitation conditions. The road continues towards Kosovo and the Federal Republic of Macedonia following the road direction Matesevo – tunnel Tresnjevik – Andrijevica – tunnel in the region Cakor – Peja. Compared to previous amendments, “Bratonozici” is now the basic corridor on the section Podgorica – Matesevo and the corridor of “Kuci ” is a variant corridor.
  2. The highway Belgrade – Montenegrin coast: border to the Republic of Serbia in the region of Boljare – Crnca – Ivangrad Andrijevica – Adriatic highway – Titograd (Tolosi) – Virpazar – Sozina (tunnel) – Bar;
  3. Highway Titograd – Skadar: Farmaci – Southern bypass around Titograd – Tuzi – Albanian border, with the obligation of further spatial and project research of the optimal corridor.

The basic preconditions for the highway Bar-Boljare project implementation were met by adopting the Spatial Plan of Montenegro by 2020 (2008) and the Detailed Spatial Plan for the Bar-Boljare highway (2008). Construction of the highway Bar – Boljare is envisaged under the Spatial Plan of Montenegro by 2020 and its guidelines envisaged elaboration of the Detailed Spatial Plan of the Bar – Boljare highway for the subject infrastructure corridor. Highway network is defined under the Spatial Plan of Montenegro, noting that the Spatial Plan envisages mandatory preservation of planned corridors from any other requirements and uses which contradict or disturb their intended use.

Detailed Spatial Plan of the Bar – Boljare highway includes the corridor and highway route through the following locations: Durmani – Sozina tunnel – Virpazar – Tanki Rt – Farmaci (Podgorica) – Smokovac (Podgorica) – Uvac – Matesevo – Andrijevica – Berane – Boljare. According to the Detailed Spatial Plan of the highway Bar-Boljare, the zone of immediate effects of the highway covers the area of approximately 1,400 km2 which covers more than 100 cadastral municipalities that make up parts of the territory of 7 municipalities in Montenegro: Bar, Cetinje, Podgorica, Kolasin, Andrijevica, Berane, Bijelo Polje, with a total of 338,114 inhabitants according to the 2011 census. Albania, Kosovo, Bosnia and Herzegovina and Serbia are orientated towards the highway Bar-Boljare, encompassing a wide gravitational area with about 4.7 million inhabitants. Under the Detailed Spatial Plan, phased construction of the Bar-Boljare highway is planned:

Phase I: Smokovac – Matesevo;
Phase II: Matesevo – Andrijevica and bypass Smokovac – Tolosi – Farmaci;
Phase III: Andrijevica – Boljare;
Phase IV: Podgorica – Djurmani.

Transport Development Strategy of Montenegro (2008) provided that the traffic integration of Montenegro into Trans-European Transport Network (TEN-T – Trans – European Transport Network), inter alia, would be achieved by the Bar-Boljare highway.

The aforementioned Strategy envisages focusing special efforts of Montenegro on activities and procedures for modification of the core regional transport network in South-East Europe (Core Network), to include the Bar-Boljare highway into general regional transport network, given the capital importance of the project for Montenegro, and as one of the goals, Transport Development Strategy of Montenegro defines the continuation of activities on the highway Bar – Boljare construction, as a section of the highway Belgrade – Bar. Further development of the transport network in South East Europe, especially in the further development of the TEN-T, followed in 2003 and 2004. Coordinated by the infrastructure Group of the Stability Pact and with the participation of financial institutions a new detailed study (REBIS – Regional Infrastructure Study for the Balkans) was drafted, which included the matching of needs and possibilities of regional development in Croatia, Bosnia and Herzegovina, Serbia, Montenegro, Kosovo, Albania and Macedonia. As the product, the so-called Core Network was created and a number of the most urgent infrastructure projects in the region were completed. International financial institutions committed to focus their attention only on the basic lines of the network, which gave special significance to the document. Also, countries that participated in the formulation of the Core Network agreed and signed several documents on common interests and working together in defining and building the Core Network. The first document was a Memorandum of Understanding on the development of the core regional transport network in South-East Europe which was signed in Luxembourg on 11 June 2004. It was agreed to appoint a special Regional Secretariat for monitoring transport in South East Europe (SEE – South East Europe Transport Observatory) with headquarters in Belgrade. In accordance with the Memorandum, in Skopje, in November 2004, the first annual meeting of transport ministers of countries signatories of the Memorandum was held to address the issues in the implementation of the Core Network and further activities related to infrastructure and transport services, including regulatory and administrative procedures. In early June 2008, the meeting of the Subcommittee on Transportation and representatives of the European Commission decided to include the Bar-Boljare highway on the list of priority projects in the framework of the Multi Annual Plan 2009-1013 to the Memorandum of Understanding on the development of the core regional transport network in Southeast Europe.

The Government of Montenegro and the Member States of the European Union, on 15 October 2007, signed the Stabilization and Association Agreement covering all aspects of cooperation between the parties. The Stabilization and Association Agreement entered into force on 1 May 2010. The Agreement includes the necessity of building the main regional transport network and the development of the transport system in Montenegro, which is in line with the EU system, which will contribute to regional cooperation for European integration and improving the operation of the Core Network.

The highway Bar – Boljare is included in the SEETO Comprehensive Regional Transport Network, as part of SEETO Road Route 4 (SEETO Road Route 4: Vrsac – Belgrade – Podgorica – Bar), through Annexes – Annex III VOL 30/33 and 31/33 (see link), in October 2011, and is a priority of the Government of Montenegro and one of the elements of the strategy for the country’s integration in the European Union, which will enable a more efficient and safer mobility of people, goods and services. Particular progress towards transport integration of Montenegro was achieved by indicative expansion of the main regional transport network TEN-T at a meeting of heads of governments of Western Balkan countries held in Brussels on 21 April 2015, which covered among other things SEETO Road Route 4, and that represented an extension of one of the key trans-European corridors Middle East – Eastern Mediterranean (see link).

Regional Development Strategy of Montenegro for the period 2014-2020 (2014), as an instrument to reduce regional disparities in Montenegro and to achieve more balanced socio-economic development of the region, based on competitiveness, innovation and employment, envisaged the implementation of key capital projects, the most important being the Bar-Boljare highway.

The importance of the highway Bar-Boljare for traffic and economic connections and for intensive economic development of Montenegro and the region was recognized under the State Road Development and Maintenance Strategy of Montenegro (2008). The aforementioned Strategy, as an important reason that argues in favor of the necessity of the highway Bar-Boljare construction, states the need to raise the level of safety and reduce the number of traffic accidents, bearing in mind that it is virtually impossible to upgrade the road through Platije to the level of fast traffic, since the funds necessary for its construction would approximately equal the cost price of the new highway, while the actual problems would still remain.

3. Specific activities implementing the Bar-Boljare hightway project

In 2006, the Ministry of Transport, Maritime Affairs and Telecommunications at the time, was tasked to implement the Bar-Boljare highway project. The first step was to collect the planning documents, which existed and were kept by the former National Institute for Urban Planning, Directorate of Transport, Monteput, and others. The decades-long dilemma regarding the highway route from Verusa to Podgorica was still topical, and it was decided to form a team of experts to review together with the Spatial Plan designers which variant was considered more acceptable, “Kuci” or “Bratonozici”. There was also a public hearing, which resulted in the position that the route had to follow the so-called “Bratonozici” variant.

To justify the construction of the highway Bar-Boljare, the following studies, designs and supporting documents were drawn up:

  1. 1998 General Design (Conceptual Design) for section Andrijevica- Boljare,
    Designer “Put inzenjering” – Podgorica, Montenegro;
  2. 2008 Feasibility Study for the Bar – Boljare highway
    Designer “Louis Berger SAS”, France;
  3. 2008 General Design (Conceptual design) for the section Matesevo-Andrijevica,
    Designer “Simm inzenjering” – Podgorica, Montenegro;
  4. 2008 General Design (Conceptual design) for the section Smokovac-Tolosi-Farmaci,
    Designer “Simm inzenjering” – Podgorica, Montenegro;
  5. 2008. General Design (Conceptual Design) for the section Djurmani-Farmaci,
    Designer “Simm Inzenjering“ – Podgorica, Montenegro;
  6. 2009. Preliminary Design for the section Smokovac – Uvac,
    Designer Faculty of Civil Engineering– Podgorica, Montenegro and “Vojvodina Center for Roads JSC“ – Novi Sad, Serbia;
  7. 2009. Preliminary Design for the section Uvac – Matesevo,
    Designer “Civil Engineering Institute of Croatia “ – Zagreb, Croatia;
  8. 2009 Feasibility Study for the Bar-Boljare highway, Montenegro,
    Designer „Scott Wilson“, Scott House, United Kingdom, in collaboration with the International Finance Corporation of the World Bank (IFC – International Finance Corporation);
  9. 2012. Feasibility Study SEETO – Road Route 4: Investment Plan,
    Designer is a consortium whose lead partner is “URS Infrastructure & Environment UK Limited,” Scott House, United Kingdom, and other partners: SYSTAS S.A. CONSULTING ENGINEERS – Kallithea, Greece; TTA STRUCTURAL ENGINEERS (T. Tsiknias & Associates SA) – Athens, Greece; OMIKRON KAPPA CONSULTING SA – Athens, Greece.

 

Preliminary design for the priority section Smokovac-Uvac-Matesevo of the highway Bar-Boljare is the optimal solution obtained in a series of iterative steps, with an objective assessment of design solutions. 18 alternatives were elaborated including the development of several solutions in the so-called “Kuci” corridor and several variants in the so-called “Bratonozici corridor”. Consideration of the two variants took decades of debate in the past. All variants were carefully evaluated and assessed through multiple criteria analysis and one variant, which was the best, was supported by nearly ninety engineers who participated in elaboration of the Preliminary Design Smokovac – Uvac. The design included a multidisciplinary approach with consideration of all economic, physical, environmental and other consequences of building with respect for all the limitations and conditions. The highway route was discussed in terms of space availability, and all indicators obtained through the dynamic and geometric analysis, together with other indicators (economic development of the area, the use of material wealth, environmental effects, etc.), were included in the evaluation of variants based on which the optimal corridor was selected. On the basis of all research and analysis, Preliminary design was reviewed and verified for further preparatory phases.

On the basis of adopted Spatial Plan of the Bar – Boljare highway, section Smokovac – Uvac, as part of 12 elaborated general solutions, in the process of drafting the Preliminary Design for the section Smokovac-Uvac, a solution for the interchange Strganica was discussed from the technical, economic, environmental and other aspects, and rejected in the report analyzes as unsustainable and technically unfeasible. The proposed solution for the interchange Strganica neither solved the issue of connecting the main road M-2 and urban network to the Bar-Boljare highway, which was a major drawback since one of the main tasks of the highway was to accept transit traffic on all roads, in addition to inconsistency with planning documents, and due to differences in altitudes of two highways (highway Bar-Boljare and Adriatic-Ionian highway).

The solution proposed under all planning documents, follow-up studies, strategies and design documents, taking into account the Spatial Plan of the SR Montenegro to 2000, which included amendments in the part referring to the road transport network, designed by Croatian Urban Institute – Zagreb (1999), and amendments designed by the Republic Institute for Urban Planning and Design, was to have a highway passing through the area of Smokovac. Then, the same was concluded by the assessment of the situation and perspectives of spatial development of the Republic of Montenegro – a strategy (in 2006) designed by Montenegro-inzenjering Podgorica, the Institute for Architecture and Urban Planning of Serbia – Belgrade and the Urban Planning Institute of Slovenia – Ljubljana.

The sectoral study SS-AE 4.7 – Traffic (2005), which was designed by the University of Montenegro and the Republic Institute for Urban Planning and Design, Podgorica, the highway passes through Smokovac, where it intersects with the Adriatic-Ionian highway.

There was a particularly intense public debate when the new Spatial Plan of Montenegro was designed (Montenegro-inzenjering Podgorica, Institute for Architecture and Urban Planning of Serbia – Belgrade and Urban Planning Institute of the Republic of Slovenia – Ljubljana), adopted in 2008, and during elaboration of the Detailed Spatial Plan of the highway Bar-Boljare (Montenegro-inzenjering Podgorica, Winsoft – Podgorica, Faculty of Civil Engineering – Podgorica and SIMM inzenjering Podgorica), which also envisaged an interchange in Smokovac.

After the economic crisis that engulfed Europe in 2008, the process of changing attitudes towards Chinese investments in Europe began. That was significantly contributed by the decision of the Government of the People’s Republic of China on the extension of a credit line of $ 10 billion for projects in Central and Eastern Europe, as announced by the former Prime Minister of PR China Wen Jiabao, at a conference in Warsaw, on 26 April 2012. It is also necessary to emphasize the overall strengthening of economic relations between the European countries with the People’s Republic of China, especially after 2012, when annual summits of the People’s Republic of China and 16 European countries of which a significant number of EU Member States (Estonia, Latvia, Lithuania, Germany, Czech Republic, Slovakia , Hungary, Poland, Romania, Bulgaria, Slovenia, Croatia) started taking place. In addition, spreading of such cooperation to other highly influential members of the EU is noticed. In all cases, investments and signed contracts for Chinese investments in European countries have exceeded $ 6 billion in recent years, supported by Chinese financial institutions at favorable terms, and therefore the economic attitude has to be considered rather than any other aspect.

The Government of Montenegro, in 2008, decided to build a new highway from Bar to Boljare through the contractual form of partnership between public and private sectors. The project included the design, financing, construction, operation and maintenance of one or more sections of the highway, and it was conducted through a transparent, competitive and open international public bidding procedure. The intention was to regulate the project implementation by the Concession Agreement concluded between the Government of Montenegro, represented by the then Ministry of Transport, Maritime Affairs and Telecommunications, and the winning bidder, for a period of 30 years from the date of completion of construction and putting into operation of the first section of the Highway. Given the strategic importance of the Project, the World Bank and the International Finance Corporation, as part of the World Bank, were engaged as additional support to its implementation, in addition to a number of renowned experts, design and consulting companies.

Tendering process was divided into two phases:

  1. Pre-qualification;
  2. Submission of Bids.

In the prequalification process, which was conducted in June and July 2008, the Ministry carried out a selection of six potential bidders. Qualified bidders were then invited to tender for the conclusion and implementation of the Concession Agreement.

Bids of the following bidders were timely submitted:

  1. ALPINE/PORR CONSORTIUM, consisting of Alpine Bau (Austria), Porr Solutions Immobilien und Infrastrukturprojekte (Austria) and Osijek-Koteks dd (Croatia), with the Company Alpine Bau heading the consortium;
  2. CONSORTIUM KONSTRUKTOR, consisting of the Companies Konstruktor-inzenjering dd (Croatia), Croatian Civil Engineering Institute Inc. (Croatia) and Tehnika dd (Croatia), with the Company Konstruktor heading the consortium;
  3. CONSORTIUM AKTOR/HCH, consisting of the Companies Aktor Concessions (Greece) and Housing & Construction Holding Co (Israel);
  4. COMPANY STRABAG (AUSTRIA).

Evaluation of technical and financial parts of the bids resulted in the following rankings:

  1. Consortium Konstruktor;
  2. Consortium Aktor / HCH.

The Government of Montenegro, in 2009 and 2010, had intense negotiations primarily with the Croatian Consortium, and after their failure to close the financial structure and provide 100% funding, negotiations with the then second-ranked Consortium Aktor/HCH were intitaited, where no public-private partnership was concluded either, although support from the European investment Bank was expected in their portfolio, which failed in the end. After that, in 2010-2011, there were various talks and initiatives aimed at finding a model for the highway Bar-Boljare project implementation, and in that sense, meetings at the invitation of the European Commission were organized through the Ministry of Transport, Maritime Affairs and Telecommunications, including the meeting in Brussels, on 22 April 2010, where the highway Bar-Boljare project was presented, which was attended by representatives of the European Investment Bank, the European Bank for Reconstruction and Development and the World Bank. And besides, a major interest in the project was expressed by various other partners, coming from different countries, and even from the PR China.

During 2011, the line Ministry signed a memorandum on the improvement of cooperation in infrastructure construction with the People’s Republic of China, which was an additional initiative that made the Chinese Companies such as Poly Technologies, China Communications Construction Company Ltd. (CCCC), China Road and Bridge Corporation (CRBC), Shangdong, Sino Hydro, etc. interested in the project.

In that field of interest, serious negotiations on finding a model for the realization of the highway project started with Poly Technologies, which later included the Company CCCC, as someone who was predominantly engaged in road infrastructure (i.e. their daughter company CRBC). And yet the financing terms offered back then were not even close to the preferential conditions which were subsequently obtained from the Chinese EXIM Bank. The former model, in addition to interest of 6.75%, included a 7% interest charged by their State insurance company Sinoshure, as security for the operation (works) abroad.

The Ministry of Transport and Maritime Affairs, during further development of the process, as a priority, focused their activities on the choice of most optimal model, sources and methods of funding the highway project, and accordingly, the selection of a suitable contractor for its construction. The Ministry of Transport and Maritime Affairs received expressions of interest in the Bar-Boljare highway construction projects, i.e. priority section Smokovac-Uvac-Matesevo, from a large number of potential partners from several countries, especially from China, Turkey, the United States, Germany, Poland, India, Italy and Canada. All who expressed interest in participating in the Bar-Boljare highway construction project were contacted, and 4 companies/consortia/institutions expressed the highest level of interest and knowledge of the project, and their given options were finally considered and evaluated:

– US-Russian Consortium Bechtel-Enka;
– Turkish Consortium Dogus-Gulsan;
– Companies CCCC / CRBC;
– European Investment Bank.

The main principles that guided the platform for the current course of negotiations with potential partners (lenders and contractors) included:

– costs of design and construction;
– compliance of potential credit debt with the budget of Montenegro;
– start and end of works;
– references of potential partners;
– technological changes / improvements over the existing architectural solutions;
– engagement of Montenegrin construction companies and the workforce;
– application of European TEM standards,
– application of substantive law of Montenegro.

Bids, in addition to the technical segment, contained the proposed funding model. During the gathering, evaluation, assessment and selection of the best partners (lenders and contractors), the application of national legislation was fully complied with. The Government of Montenegro, as the Employer, did not conduct the tender procedure or any other form of public procurement for selection of contractor for the construction and design of the highway Bar-Boljare, priority section Smokovac-Uvac-Matesevo, because according to Article 3(2) of the Law on Public Procurement (“Official Gazette of Montenegro” 42/11), which provides for exemption from the application of Public Procurement Law in the case when the project is implemented on the basis of international agreement, there was no obligation to announce a tender or other forms of public procurement, because the project would be jointly implemented by the parties to the international agreement.

Government of the People’s Republic of China and Montenegro signed the Agreement between the Government of Montenegro and the Government of the People’s Republic of China on the promotion of cooperation in infrastructure construction (“Official Gazette of Montenegro – International Treaties” 13/08), and the highway project was the subject of amendments to the said international treaty (“Official Gazette of Montenegro – International Treaties”, 7/14), which had to facilitate the implementation of major infrastructure projects on other grounds as well, not only on the basis of a concession as it was originally envisaged under the mentioned interstate agreement between the Government of Montenegro and the Government of the People’s Republic of China. Based on the above, it is clear that the entire process of the Contractor selection for the priority section of the highway was carried out in accordance with the law of Montenegro.

The Government of Montenegro, at the meeting of 4 July 2013, evaluated the offer of Chinese Companies CCCC and CRBC, for the design and construction of the priority section Smokovac-Uvac- Matesevo of the highway Bar-Boljare, as first-ranked, opening the negotiating process between the Government and the aforementioned Chinese companies. On 26 February 2014, the Design and Build Contract was signed for the Bar-Boljare highway, section Smokovac-Uvac-Matesevo, between the Government of Montenegro, i.e. the line Ministry of Transport and Maritime Affairs, and Chinese Companies CCCC/CRBC. The Ministry of Transport and Maritime Affairs and Ministry of Finance, on 3 March 2014, submitted a loan application to the EXIM Bank of China for approval of funds to finance the implementation of the priority section Smokovac-Uvac-Matesevo of the Bar-Boljare highway, and on 30 October 2014 the Preferential Loan Agreement was signed by and between the Government of Montenegro, i.e. the line Ministry of Finance, and the EXIM Bank of China in connection with the financing of the Project. The condition for the effectiveness of the Design and Build Contract was the conclusion of the Project Financing Agreement. The Government of Montenegro submitted both contracts to the Parliament for reference, and the Draft Law on the Bar-Boljare Highway for approval, which provided the highest level of transparency and accountability in the decision-making process on this important strategic project.

Once the relevant legal and contractual preconditions had been completed, 11 May 2015 was set as the Commencement Date of the Works on the priority section Smokovac-Uvac-Matesevo of the Bar-Boljare highway.