Latvia could postpone some road-reconstruction projects

Due to significant rises in costs, Latvia could opt out of major road redevelopment projects, Latvian Radio reported March 16.

The Ministry of Transport announced this week that 150 kilometers of state roads would be rebuilt or repaired this year, with €230 million in investments. The state and the workers are ready to begin. However, the road builder companies, represented by head of the Latvian Road Builders association Andris Bērziņš, have different views.

“We are currently in a great deal of reflection on what to do since the road construction season should start in two and a half weeks, but all the important prices have skyrocketed. [..]. They are two, three times higher,” Bērziņš said. The Transport Minister Tālis Linkaits and the road builders have agreed to calculate whether it is possible to work with such prices.

“I assume that one part of these procurement contracts can be switched over to a time when prices are returning to a more reasonable level [..] At the moment, the uncertainty is too great to say at all what direction it is heading,” the minister said. 

In the coming weeks, Latvian State Roads will estimate which plans can which road reconstruction plans could be postponed. The Fiscal Discipline Council also encourages this, indicating that growing public debt would not be wise, that price increases are driven by the country itself with more spending, and that inflation could be slowed down by the postponement of some more money-intensive plans.

 

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