Finance Minister Ridvan Bode says Turkey’s Kurum has paid Euro 57 million after having Euro 21 million deducted in tax refunds. The money will be used to pay off outstanding bills to private companies for public works
TIRANA, May 21 – Turkey’s Kurum which acquired four Albanian small and medium-sized hydropower plants for around Euro 110 million has paid the first Euro 57 million after having Euro 21 million deducted in VAT refunds for the steel plant operations in Elbasan. This is confirmed by Finance Minister Ridvan Bode as the deadline for the payment of the Euro 110 million winning bid was expiring. Government had approved a decision recognizing 3 billion (around Euro 21 million) to Kurum in VAT refunds, unblocking the process which seemed to be in a deadlock.
The Finance Minister assures the money collected from the privatization of the four HPPs will be used to pay out unpaid bills to private companies for finished public works. The ministry says it has paid out Euro 105 million in debts to private companies mainly engaged in the construction of major public works.
The Albanian government owes the private sector in unpaid bills over Euro 200 million, business representatives say. The majority of unpaid bills, at an estimated Euro 120 million, belong to the crisis-hit construction sector, followed by Euro 50 million to service companies and 12 million euros in unpaid bills to hydropower plants concessionaries for electricity purchases. Businesses also claim dozens of millions of Euros in VAT refunds.
Under the contract signed last March, Kurum’s deadline for the payment was until mid-May.
Turkey’s Kurum International, which in Albania already operates the Elbasan steel plant, offered a total of Euro 109.5 million on the privatization of four small and medium sized hydropower plants, being the highest bidder. In an international tender held on December 21, Kurum International offered Euro 52 million on the purchase of the Bistrica 1 and Bistrica 2 HPPs in southern Albania with a capacity of 27.5 MW and Euro 57.5 million on the Ulez and Shkopet HPPs which have an installed capacity of 49.2 MW.
For Kurum, one of the country’s largest electricity consumers, the purchase of the HPPs will considerably lower its power costs as a new law in force since the beginning of 2012 stripped big electricity consumers to have power supply at regulated tariffs from the local distribution operator.
