Croatia backs up from monetization of highways

Croatian Prime Minister Zoran Milanovic said on Friday evening his government is backing up from lease the operation of its highways to foreigners instead of giving it to local pension funds and citizens.

Milanovic said the government would go for "an initial public offering to the pension funds and citizens", the Croatian Radio-Television (HRT) reported.

The government would offer 51 percent shares of a company managing the highways to pension funds and citizens, while the state would keep 49 percent, he said.

Croatia had opened a tender to lease the operation of its highways, which connect the countryside with the Adriatic coast, to foreign firms and the government announced it had received non-binding bids in the end of last year.

However, the tender was opposed by some trade unions and citizens and a civic initiative "We Are Not Giving Our Highways" said they have collected more than 460,000 signatures, more than needed, for a referendum on the issue.

Now Croatian authorities are checking whether the referendum request is legally valid.

Croatia has built a highway network of more than 1,000 km over decades with loans to develop tourism which the country heavily depends on.

But public road companies failed to raise enough from tolls to return the debt, which stands at 4 billion euros (4.2 billion U.S dollars) of principal and 4.5 billion euros of interests. The government had plan to raise 2.5 billion to 3 billion euros through the tender to cover a part of debts. (1 euro = 1.05 U.S. dollars) Endit