Blogging from the Murcia region of Spain until early June, when I return to
the Highlands of Scotland for a few months

'Fair and softly goes far' - Miguel de Cervantes

Sunday, 18 December 2016

A rescue plan is finally agreed for bankrupt Spanish toll motorways

The Ministry of Development(or "Ministry of Public Works" ['Ministerio de Fomento]') has finally agreed a rescue plan for toll motorways in Spain 'in bankruptcy'. The public funds required to carry out this rescue plan will amount to between €4.5 and €5 billions according to the details released by the Ministry. The routes involved are:

- the four radial access motorways around Madrid;
- the M-12 which provides access to Barajas Airport in Madrid;
- the AP-41 which links Madrid and Toledo;
- the radial motorway around Alicante;
- the sector of the AP-7 between Cartagena and Vera.

A few weeks ago the Government asserted that the rescue plans then being formulated would not cost the public purse one Euro, but there is a clause in the original concession agreements that requires the State to step in to take over management of concessions which go into bankruptcy. Initially the Government had tried to get the creditors to accept a "haircut" of 50% of the debts due, with the remainder to be paid off over 30 years, which would it was hoped be funded by toll revenues. However the private lenders who financed the motorways declined to accept this solution and their interpretation of the contract detail has finally been upheld by the courts - so the Government must pay up. It appears that the haggling between the lenders, many of them foreign banks, and the Spanish authorities has been going on for well over two years (see the second linked article below).

Sources:
- Al final, el rescate de los peajes lo pagamos todos (Autobild.es - 13th December 2016), this article is in Spanish;
- Foreign banks resist losses on Spanish motorway rescue (Reuters - 1st October 2014), this article is in English.

My most recent article on on the vexed subject of the [lack of] viability of parts of the Spanish toll motorway network was published here on 12th November 2016 and you can read it by clicking this link:
Moves afoot on eight financially precarious toll motorways in Spain


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