The new state guarantee is threatening to fall

The German company WTE Wasertehnik from Essen has warned that it will activate the guarantee given by the Government to the Municipality of Budva for a loan of 58 million euros for the construction of a waste water treatment plant in the Vještica settlement in Vienna, because this year's installment of six million has not been paid.

In February 2010, the Government gave its consent to the Ministry of Finance to issue a state guarantee of 29,25 million euros for a loan from the Municipality of Budva for the construction of a facility in the Vještica settlement near the German Development Bank (KfW). The municipality has committed to pay about 20 million euros for the project in the next 120 years with interest and maintenance of the plant, and it is expected that six million euros will be returned annually in the first eight years.

Because of the loan, the municipality increased water prices by 1,66 euros per cubic meter for citizens, and twice as much for the economy. A water meter fee of eight euros was also introduced. It was planned that six million loans would be settled by the municipality paying three million, one and a half million euros to the city water supply through an increase in the price of water, and one and a half million would be provided by introducing an environmental tax for tourists through the investment program. However, nothing was realized from that plan, so WTE had to pay this year's installment itself.

The story of the capital project, which is under prosecutor's investigation because criminal charges were filed against seven persons and three companies due to damage caused to the Municipality of eight million euros, was formalized at the beginning of June 2009, when the Municipality concluded a contract with WTE.

The plant in Vještica, which was officially opened by Prime Minister Milo Đukanović in October 2014, led to numerous problems from the beginning, starting with the unresolved issue of waste sludge disposal, which is why the villages of Boreti and Ivanovići in Bečići are facing an environmental disaster, and to the point that the Municipality fails to repay loan obligations.

The German company was ranked first in the tender, which the Municipality announced in 2008, looking for an international partner for the realization of one of the most valuable projects on the coast. The project is implemented through a public-private partnership between the local government and a German company, with the financial support of KfW.

The municipality took a loan of 58.560.000 euros, and the original contract stipulated that the term of the works would be five years, and the loan repayment term would be 20 years with a grace period of three and a half years. The contract also provided for the establishment of the company "WTE Otpadne vode Budva", which was entrusted with the project. After the basic contract, three agreements were signed.

So far, 42 million euros have been spent on the implementation of the project, but for two years, representatives of the opposition have raised doubts about the money spent, while the local administration claimed that the entire work was carried out in accordance with the law.

The problem of repaying that loan was the topic of a meeting between Finance Minister Radoje Žugić and Budva Municipality President Srđe Popović with German Ambassador Gudrun Štajnaker two days ago.

The Ministry of Finance announced after the meeting that Žugić "indicated the urgency of the need to provide mechanisms that will ensure the fulfillment of contractual obligations and that it is imperative that all investors have the security of collecting their claims".

Yesterday, the Ministry did not reply to the "News" whether there is a danger that the guarantees given by the state to the Municipality of Budva will be activated.

Astronomical water prices due to credit

Budva Democrats yesterday asked where the million dollar debt of the Municipality towards WTE came from, if the citizens of Budva pay the most expensive water in the region and Europe for that purpose and for that service.

The Democrats also state that the Government of Montenegro played a major role in that project, as well as in all other large "projects", that is, the affairs in Budva, so it would be fair if the Government also carried a large part of the burden of solving Budva's problems.

"Everything that was done in Budva, from beginning to end, could not have been done without the knowledge of the Prime Minister and the ministers in the Government. We, gentlemen from DPS, can only ask ourselves what we paid for 15 months and where did that money end up. Or maybe we should ask Miloš's skipper?", the announcement concludes.