Semi-Private Co. To Build Motorways

The move allows the government to place the costs of motorway building outside the public sector, reducing central budget deficit, said Economy and Transport Minister János Kóka. According to EU rules, state-owned ÁAK classifies as a private company, because it collects more than 50% of its revenues from outside the state budget, namely from road tolls. In future, the Hungarian government will pay service fees for newly built motorway sections for 20-30 years, and such service fee payments also classify as non-public sector revenues.

Thus former motorway builder National Motorway Rt. (NA) soon will hand over its contractual obligations to ÁAK, which in turn will pay HUF 137 billion into the state budget this year. ÁAK will take a loan or issue bonds to finance its payment obligations, and is expected to manage a total of HUF 400 billion in debt.

According to the 2003 law on motorway building, the company will have to build 431kilometers of new roads and prepare grounds for building 400 kilometers of more roads by 2006.