Montenegro Tries To Cool EU Row Over $1 Billion China Road

Podgorica, Montenegro, (UrduPoint / Pakistan Point News - 16th Apr, 2021 ) :Montenegro's finance minister on Friday tried to ease concern over a near $1 billion Chinese-backed road project, insisting the country could afford to repay the debt and did not need EU help.

The project is part of a huge wave of Chinese investments across the Balkan region, which has sparked concern that governments have become too reliant on Beijing's money.

The NATO country, which is pushing for EU membership, took out the $944 million (788 million euro) loan in 2014, but the project has been dogged by allegations of corruption and doubts over its viability ever since.

Finance Minister Milojko Spajic, part of a government that took power last year after three decades of rule by the socialists, had been widely quoted this week as saying Montenegro wanted EU help to repay or refinance the debt he inherited.

The reports prompted the bloc to flatly reject the idea, but Spajic told AFP the claims were based on misunderstandings.

"As we have already said, no request for taking over, payment or assistance in repaying the Chinese debt was sent to the European Commission, and therefore it could not be rejected," he said.

And he insisted the country was in a position to service the loan, with 14 years of repayments due to start in July.

"Montenegro has stable and sustainable public finances and can regularly finance all its debts and obligations to international partners," he said.

The public debt in Montenegro, a state of 600,000 people on the Adriatic coast, stood at 97 percent of GDP last year and the coronavirus pandemic has wrecked the tourism industry, its main source of income.