The Eighth Discussion Forum presented the construction prospects for year 2019

Next year will be a key period for realization of large-scale infrastructure projects

Team of „Stroitel“ Newspaper „The forthcoming 2019 is a key year for the 2014 – 2020 programming period. The launching of major infrastructure projects in the road sector and the environmental sector is expected to happen within this year. This situation necessitates the mobilization of the entire construction sector, which has to cope with number of problems, such as the ever more serious lack of personnel“. With these words Eng. Iliyan Terziev – Chairman of the Management Board (MB) of BCC opened the eighth discussion forum „Construction in 2019 – prospects and challenges”, organized by the Bulgarian Construction Chamber and the „Stroitel” Newspaper. Eng. Terziev has announced the start of the event together with Kjetil Tonning, President of the European Construction Industry Federation (FIEC) and Tomislav Donchev, Deputy Prime Minister. In the opening participated as well the Minister of Regional Development and Public Works Petya Avramova, the Mayor of Sofia Municipality Yordanka Fandakova, the Deputy Minister of Transport, Information Technologies and Communications Velik Zanchev. „The goal of this forum is to talk about the real problems and challenges, which sector faces. To bring forward our proposals for improving the construction and investment process. To get from the institutions a first-hand information what to expect in 2019 and until the end of the programming period, which are the large projects, what is the work that lays ahead for construction companies”. What is the vision for sector’s development in European scope – this is what we will expect to learn by our special guest – the President of the European Construction Industry Federation – Mr. Tonning, and in respect to the national scope – by the Deputy Prime Minister Tomislav Donchev and Minister Avramova. Also, we are going to talk about the safety and what could be done so that our roads become safer. The topics are many, our guests are extremely competent and this provides good reason to me to expect that the most important in this year forum to our branch, will be significantly successful”, added Eng. Iliyan Terziev. Before giving the floor to the Deputy Prime Minister Tomislav Donchev to speak, Eng. Terziev announced that the EU Parliament President Antonio Tajani had sent to BCC and to the participants in the event a congratulatory address, which has been presented by the moderator of the first part of conference Eng. Lyubomir Kachamanov, member of the EB and MB of BCC, Chairman of the BCC RO – Sofia, and FIEC Vice-president. Dear Mr. Terziev, thank you for inviting me to participate in the eight discussion forum on "Construction in 2019 - prospects and challenges". Unfortunately, due to prior commitments, I will not be able to take part in the event. Allow me to congratulate the Bulgarian Construction Chamber and „Stroitel“ Newspaper, organisers of this important forum, and the participants - from representatives of central and local authorities to construction companies - who will attend. The construction sector is vitally important, not only for the economies of individual countries, but for the economy of the European Union. Building modern infrastructure is crucial to business development and for attracting investment. It plays a major role in improving connectivity between countries and regions. It also creates jobs for millions of European citizens. All reasons why the topic of the forum is extremely significant. The sector's prospects depend on operational programmes, the use of financial instruments and the development of public-private partnerships. The vision for EU cohesion policy after 2020 is also important for its future. Bulgaria has made good use of EU funds with many examples of successfully implemented projects thanks to European solidarity, such as the Sofia metro system. I am confident that the expertise on display and discussions at the eight construction forum will translate into proposals and ideas that will feed into the upcoming discussions on the proposed new EU budget financial framework. I wish you every success with the event. Yours sincerely, Antonio Tajani“, is said in the official letter. „A very high rating for Bulgaria, very good assessment of achievements of construction branch, and from the possibly highest position – from the EP President“, underlined Eng. Terziev and announced that BCC has received congratulatory addresses as well by the Chair of the EP Committee on Regional Development Iskra Mihaylova, by the Chairperson of the Parliamentary Committee on Economic Policy and Tourism Eng. Petar Kanev. According to the opinion of the Deputy Prime Minister Tomislav Donchev, as per volume of public funding for construction sector, the situation looks rather bright. „Up to 2023, solely from EU funding, not less than BGN 1,5 billion per year will be spent for infrastructure, whereas after adding all other sources with public nature, this amount will be doubled. If at the moment we spend for construction and rehabilitation of road infrastructure about BGN 300 million yearly from budget sources, our ambition for the period after introduction of the TOLL system is this amount to be increase almost three times“, Donchev pointed out. „It is a huge honour for me to be in Sofia at this important conference, because its goal is to discuss the prospects and challenges in front of construction in 2019. BCC is very active FIEC member. Eng. Lyubomir Kachamakov, in his capacity of Federation’s Vice-president, responsible for Central and East European countries has contributed a lot to this“, underlined Kjetil Tonning. Minister Petya Avramova determined 2019 as a key year for the road construction in Bulgaria. „The Ministry of Regional Development and Public Works has given a green light to projects for almost BGN 3 billion, and their implementation will go on“, is what she announced and outlined the large infrastructure projects for 2019. According to her words, „Hemus“ Motorway and „Struma“ Motorway remain priorities for the government. „This event won recognition as a traditional place for presentation of some of the biggest and of national importance infrastructure projects in our country. Congratulations for the organisers this year for including a panel, detached to the road safety. This is a topic, that requires a serious engagement of many institutions, as well as of all people“, the Deputy Minister Velik Zanchev stated. The Sofia Mayor Yordanka Fandakova, introduced the priorities of Sofia Municipality in construction program for the next year. „A lof work awaits us during 2019 year. We continue to implement important strategic projects, financed by European sources. We expect next year to commission into service the first 8 km of the third metro line, and in 2020 – the remaining 4 km“, she said and added that in 2019 projects for rehabilitation of the central city area are going to be implemented. Within the first panel of the forum were presented in details the progress of the ongoing and the future infrastructure projects in the country, as well as the important for the growth of Sofia urban development plans. In this panel part took as well Eng. Galina Vassileva, Head of the MA of the OP on “Transport and transport infrastructure 2014 - 2020“ („OP TTI 2014 - 2020“), Eng. Svetoslav Glosov, Chair of the MB of the Road Infrastructure Agency (RIA), Prof. Dr. Eng. Stoyan Bratoev – Executive Director of „Metropoliten” JSC, Chief Architect of Sofia Zdravko Zdravkov and Eng. Nadezhda Danailova, Head of „Project preparation” Department in the National Railway Infrastructure Company (NRIC). „The contracted under the „OP TTI 2014 - 2020“ funding is 82%, and the amount of the paid expenditures is 25,5%. These are good indicators, compared to the implementation of OP „Transport 2007 - 2013“, announced Eng. Galina Vassileva and added that resource under The Connecting Europe Facility (CEF) is negotiated at 100%, and NRIC has at its disposal 90% of the budget. Eng. Svetoslav Glosov pointed out that the successful introduction from 16 August 2019 of the TOLL system for the vehicles weighting more than 3,5 tones, and from 1 January next year of the electronic vignette for the cars, is a cause for the RIA overall team. „We are working on preparation and launching in short terms of tenders for total 137 km of „Hemus” Motorway. Before the end of the year a public procurement will be announced for construction of 3 sections with overall length almost 52 km for about BGN 494 millions“, was also announced by the Chair of the MB of RIA. According to what Prof. Stoyan Bratoev has said, the construction of the first two stages of Line 3 of Sofia metro will be continued during the next year. „The first stage of construction –from boulevard „Vladimir Vazov” – City Centre – „Krasno selo“ district, has been implemented at 76% and is to be finished in the autumn or at the end of 2019. The second stage – from „Krasno selo“ district - „Ovcha kupel“ district – to the Sofia-Pernik railway line, has approached about 36% and will be put into operation in February 2020“, summarized the „Metropoliten“ JSK Director. The topic about underground railway was continued by Arch. Zdravko Zdravkov. „The potential of the terrains, where the metro develops, especially in the contact areas, where a railway junction is also involved, become particularly attractive for investors. It is not accidental, that the attention of all construction companies was attracted by neglected areas such as „Iskar” and „Ovcha kupel”, Arch. Zdravkov said. He presented the rest of activities of the „Architecture and Public works” Direction within the Sofia Municipality, related to the growth of Sofia, such as the finalisation of the Sofia Ring Road. Eng. Nadezhda Danailova made presentation on priorities and goals of NRIC in a long term period, and firstly made a stress on the projects, that are being implemented by the National Railway Infrastructure Company under the OP „TTI 2014 - 2020“, totally amounting at BGN 1,701 billion. These projects are: rehabilitation of the railway line Plovdiv – Burgas – phase 2, modernisation of the Sofia – Plovdiv rail road: Elin Pelin – Kostenets section; reconstruction of railway station complexes: Poduyane, Iskar, Kazichene, Stara Zagora, Nova Zagora and Karnobat. We are carrying out tender procedures for these three projects, and the contracts for the Elin Pelin – Kostenets section and the station complexes has to be signed in January 2019. Moderator of this panel was Eng. Miroslav Maznev. During the second part of the conference, the attention was focused on the Operational Programme „Environment 2014 - 2020“ („OPE 2014 - 2020“), Rural Development Programme (RDP) and the projects, implemented by the Enterprise for management of environmental protection activities (EMEPA). „OPE 2014 - 2020“ was presented by Valeriya Kalcheva, Chief Director of „Operational Programme „Environment “ Directorate General within MEW. The progress in respect to the RDP development and the topic projects and activities of EMEPA were presented to the forum participants respectively by Svetoslav Tsekov, acting Deputy for Head of „Public Measures“ Department in the „Rural Development Programme“ of Ministry of Agriculture, food and forestry, and Svetla Kircheva – Director, „Funding environmental projects and activities“ Directorate within the Enterprise for management of environmental protection activities. „Announced are 99% under the „OPE 2014 - 2020“ resources. There are 88 contracts in process of implementation, amounting at little bit over BGN 1,3 billion, which represents 38% of the Operational Programme’s budget. Projects are hard, complicated and multi-component. A fact should not be neglected, that they entirely depend on carrying out tender procedures, big part of which become subject to long-term and hard appeals“, stated Valeriya Kalcheva and added that at the end of September, the Minister of Finance Vladislav Goranov has approved standardized documentation for awarding public procurement contracts in „Water“ sector. „They have been developed in an active collaboration with the Bulgarian Construction Chamber“, underlined Kalcheva. Svetoslav Tsekov stressed that during this year under the sub-measure 7.2. „Investments in the creation, improvement or expansion of all types of small scale infrastructure“ of the RDP, two tender procedures have been carried out. Svetla Kircheva clarified the main activity of EMEPA. She has announced that in 2018 the Enterprise disposes of more than BGN 74 million intended for ecologic projects and activities. Moderator of this panel was Eng. Ivan Mollov. This year for the first time the discussion forum included a panel „Road safety“, where the participants discussed this topic, as well as the last European and world trends in this sphere. The main lecturer and moderator was D.Sc.(Econ.) Nikolay Ivanov, member of the MB of BCC and Chairman of the „Road Safety“ BBA’s Management Board. As lecturers participation took also Prof. Dr. Eng. Rumen Milanov – member of the RSBBA MB and the lecturer in „Roads and Transport Constructions“ Department in the University of Architecture, Civil Engineering and Geodesy, and Eng. Aleksi Kesyakov – Secretary of the State-Public Consultative Commission on Road Traffic Safety. „Road safety is a world-wide problem. The safety of traffic is a shared responsibility between the road transport vehicles users and those, who design, build, operate and maintain the road network“, said Eng. Aleksi Kesyakov and explained what is the responsibility of each one, and whish errors are to be eliminated, in order to decrease the number of injured and killed during road traffic crashes. „Every year new motorway sections are put into operation, while the RIA budget for current repairs and maintenance remains the same“, underlined D.Sc.(Econ.) Nikolay Ivanov. He pointed out, that it is necessary to improve financing of activities, which are directly involved with the road safety. „On the recommendation of the UN and on proposal of the World Bank, in each of the member-states, the money that are distributed for road safety should not be less than 10% of overall budget intended for national road network maintenance“, added D.Sc. Ivanov. According to the opinion of Prof. Rumen Milanov, a change is needed in the philosophy related to road network functioning. „The safety is the main priority and we must be taking it into consideration in construction and maintenance financing, instead of implementing it „in by the way“, explicitly emphasized Prof. Milanov. Eng. Simeon Peshov, honorary Chairman of BCC: There is no quality at the lowest price I would like to thank to Mr. Kjetil Tonning for finding time and coming to Bulgaria specially for the Eighth Discussion Forum „Construction in 2019 – prospects and challenges“. We are proud that more than 110 years ago the Bulgarian engineering-architecture society was one of the first co-organisers of the European Construction Industry Federation (FIEC). And during the last 10 years BCC is exclusively active FIEC member. During the opening of the conference we have heard a very good prospect for constructors in 2019. This means that there is going to be work for us, but at the same time we are going to face big challenges. One of issues is the quality and admittedly all of us will have to work in this direction. What the Vice-premier Tomislav Donchev said is a nice thing– that we have to reject the lowest price criterion. There is no quality at the lowest price! The Vice-premier himself said that lots of tender procedures follow the lowest price. Few years ago one of the ministers had announced that construction we do is cheapest in Europe, at twice lower prices. That was a very poor signal for us, but now we can see, that things are changing. The governing and contracting authorities should clearly understand, that in the following 3-4 years the price of the end product will grow. It is impossible this to not happen. We, the constructors, have no options to keep our specialists, as well as to get back those, who have went to work outside of Bulgaria, other than to considerably increase the remuneration. This process admittedly relates to productivity, but the wages must be increased yet next year. According to my calculations, we are going to be forced to increase them with 20-30%. Of course, this automatically will lead to increase of final product’s price – with 5-6%. In BCC, we very often talk about training, which is the most important, as well as about attraction of workers from abroad, mainly from the diaspore in Moldova and Ukraine. But there is one issue here- in order to make workers to come from these countries, the regulations for long-term stay are to be eased, and the permit to be longer than half of year. This is not a good option, as we are training them and exactly when they are able to start working well, they are obliged to go away. I would like to refer to another topic – the control under the European projects. This question was raised during the previous conference – that the preventive control is underestimated, while the consecutive control is increased, which is extremely incorrect. It should be different – the preventive one to be reinforced, and the consecutive to be reduced. This year, again, to the many municipalities have been imposed sanctions, which is on the account of their budgets, for they had made mistakes 2-3 years ago. This situation opposites constructors to municipalities and that trend has to be reversed. I will conclude with another key topic, raised by myself several times. Measures against the green racketeering must be undertaken. It has been reminded at the forum, that for the Lot 3.2. of „“ Motorway a tender procedure is launched, but the „greens“ continue to heap on documentation to the European Commission – documentation, that is totally untruly and is directed against the Bulgarian interests, that do not reflect the measures of our country related to the ecology, as well as the care on the behalf of constructors to protect the environment. I want to tell you one example. At the time of the conflagration in the Kresna Gorge, the constructors went immediately to extinguish fire with their all equipment and people, while there was neither one man from the green racketeers. They did not take action against the disaster, but this did not stop them to continue with slanders.