GE sues Albania for railroad project broken deal

TIRANA, Sept. 27 – The U.S. General Electric company has filed the Albanian government at the Arbitration Court in Paris for breaking a 74.71 million euro contract on building a new railway link from Durres to Tirana and also the Mother Teresa international airport. But the company has declared that it would be ready to negotiate and find a suitable solution out of the court’s walls. Prime Minister Sali Berisha’s government, that took power in September 2005, canceled the project, started from the previous Socialist Party government of premier Fatos Nano, considering it premature and the loan a big financial burden to the poor country’s budget. It also said the project was not part of its own short-term strategy for modernization of the country’s infrastructure. The arbitration procedure started at the International Court of Arbitration of the Paris-based International Chamber of Commerce, according to GE’s spokeswoman Shaunda Parks not giving any comment or details. “Seeking arbitration is a right of the company and certainly we have secured all legal grounds for the actions we have undertaken,” Albania’s Economy Minister Genc Ruli had said earlier. However, Ruli added that the government had offered to the GE to re-negotiate the contract and reformat the investment. “In its previous form it was a non-priority investment and very expensive, at a high cost,” said Ruli. Parks also confirmed there were held talks between them. Nano signed the project with the Italian unit of General Electric Transportation Systems in 2003 and two years later it signed a loan of 74.71 million euro with Dutch ABN AMRO and several other banks, that was the first commercial loan post-communist Albania had signed since the fall of communism in 1990. The upgrade of the 38-kilometre railroad linking Tirana with Durres would cut travel time on the Tirana-Durres section to half an hour. It also included a new six-kilometre link from Tirana to the international airport and also upgrading of railroad signals, reconstruction of railway stations, installation of a train detection system and purchase of engines and cars.