Bechtel ponders Transylvania highway layoffs due to ‘lack of state payments’

Newsroom 08/02/2010 | 13:45

US construction company Bechtel, which is working on the Transylvania highway project, is considering the collective layoff of some of its highway workers, after being forced to cut down on its activity due to lack of payments from the Romanian state, the firm’s representatives said in a statement yesterday. According to Bechtel, the Romanian state has failed to pay its debt to the construction company or to apprise the firm of the available money that will fund the constructor’s work in 2010. Bechtel representatives said the lack of payments, which are affecting its cash flow and planned future works, have prompted its decision to reduce its activity. In the event of layoffs, the employees will receive two months’ salary as compensation.

This is not the first time Bechtel has publicly announced that it might axe workers on its highway project. At the end of 2008 it made a similar statement, claiming that due payments had not been made on time.

However, the Transport Ministry said it had made payments on time and on the agreed schedule, with the next installment due in April, similarly to the payment timetable last year. Also, Bechtel’s management knew that once the ministry will be able to access European funding, it will focus more on infrastructure projects funded with EU money, which would diminish the amounts alloted for 2010 works paid from the state budget.

It took six years from the signing of the contract for the first 42 kilometers of the Transylvania highway to be completed in December last year. The deal was inked in 2004 but the project was delayed due to renegotiations along the way and expropriation issues. During the period, Romania changed the ministers of transportation five times. The 415-kilometer-long highway, which will connect Brasov to Bors, in the west of Romania, close to the Hungarian border, will be built at an average cost of EUR 11 million per kilometer.

Corina Saceanu

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