2021 Budget Public Costs envisioned for Private Public Partnership (PPP) Concessions

Open Data Albania is investigating the costs envisioned to be paid for Private Public Partnerships (PPP) or concessions, covered by the 2021 state budget. The article conducts an analysis of the concessionary PPP contracts that are active in 2021 and the costs envisioned for each of these contracts for the period 2018-2023.

In 2021, according to the Explanatory Report of Law No. 137, the 16.12.2020 ‘On the 2021 Budget’, 18 PPP concessions are to be covered by public funds. Over 274 concessionary companies are registered in the country. For each of them, the Concessionary Register created by AIS organization contains information and data on the scope of the contract, its management, and performance. Of these concessionary PPP contracts, some are budgeted and paid directly from the state budget. The total value envisioned to support concessions from public funds for 2021 is a planned amount of 14 432 692 000 (fourteen billion and four hundred and thirty-two million and six hundred and ninety-two thousand ALL). If we convert it to Euros, it is equal to around 116 769 352 (one hundred and sixteen million and seven hundred and sixty-nine thousand and three hundred and fifty-two) Euros, according to the official average exchange rate of the Bank of Albania for 2020.

Data: MFE (2020), Report for 2021 state budget, downloaded on 21.12.2020
Processing and Analysis: Open Data Albania

The planned cost for 2021 for covering these concessions by public funds is equal to fifteen point seventy-four (15.74%) per cent of the total investments envisioned in the 2021 budget.

In terms of the budget deficit, the value stands at thirteen points twenty-eight (13.28) per cent of the projected deficit value for 2021.

Also, the planned cost for covering PPP concessions by public funds expressed in terms of Gross Domestic Product results in zero point zero nine (0.09) per cent of the Gross Domestic Product.

The legal condition for calculating Costs for covering PPPs by public funds and state budget is that the total amount of annual net payments, which are conducted by the central government units, which result from the concessionary contracts or public private partnerships (PPP), should not exceed the limit of 5 per cent of the actual budget tax revenues of the previous year. For 2021, the costs planned for PPP concessionary contracts are estimated at three points twenty-six (3.26) per cent of tax revenues.

Data: MFE (2020), Report for 2021 state budget, downloaded on 21.12.2020
Processing and Analysis: Open Data Albania

The highest cost among thirteen contracts envisioned for public funding for 2021, is marked by the contract for the construction and operation of “Rruga e Arbrit” (Arber Road). The projected value for this contract is 4 105 100 000 (four billion and one hundred and five million and one hundred thousand ALL, or 28% of the cost planned for the total PPP for 2021. This is the contract with the highest value, signed by the Ministry of Infrastructure and Energy. The contract is implemented by the concessionary company Gjoka 87. The contract is signed in 2018 with the company Gjoka Konstruksion. During the period 2019-2023, payments envisioned as budgetary support from public funds for the contract are estimated at 16 529 100 000 (sixteen billion and five hundred and twenty-nine million and one hundred thousand).

The second largest contract is the one entitled Concession/PPP (Provision of customized set of surgical instruments, sterile single-use medical supplies used in surgical halls, biological waste treatment and disinfection of surgical halls). The projected value in 2021 for this contract covered by public funds is 1 704 982 000 (one billion and seven hundred and four million and nine hundred and eighty thousand) ALL, or 12% of the planned total cost for 2021. This contract is signed by the Ministry of Health and Social Protection. This contract is managed by SaniService concessionary company and is signed with this company in 2015. During the period 2018-2023 payments envisioned as budgetary support covered by public funds are projected at 10 027 713 000 (ten billion and twenty-seven million and seven hundred and thirteen thousand) ALL.

The third largest contract ais entitled “Customs scanning service”. The projected value for this contract is 1 580 698 000 (one billion and five hundred and eighty million and six hundred and ninety-eight thousand) ALL or 11% of the planned total cost for 2021.  This contract is signed by the Ministry of Finances and Economy. This concessionary contract is managed by 2S Albania company. The contract is signed in 2013 with Rapiskan company, and is amended law in 2015. For the period 2018-2023 payments envisioned as budgetary support covered by public funds are estimated at 9 667 011 000 (nine billion and six hundred and sixty-seven million and eleven thousand) ALL.

The fourth contract in terms of the projected total cost is the one entitled “For the construction of the landfill, incinerator, and rehabilitation of existing Tirana waste disposal sites and electricity production. The projected value for this contract is 1 386 921 000 (one billion and  three hundred and eighty-six million and nine hundred and twenty-one thousand) ALL or 10% of the planned total cost for 2021.  This contract is signed by the Ministry of Infrastructure and Energy/Tirana Municipality. The contract is implemented by Integrated Energy BV SPV, owned by GeoGenix.  The contract is signed in 2017. For the period 2018-2023 payments envisioned as budgetary support covered by public funds for this concessionary project are estimated at 7 474 381 000 (seven billion and four hundred and seventy-four million and three hundred and eighty-one thousand) ALL.

Ranking continues with the PPP project for “Provision of Hospital Laboratory Services” The projected value for this contract is 1 280 444 000 (one billion and two hundred and eighty million and four hundred and forty-four thousand) ALL or 9 % of the planned total cost for 2021.  This contract is signed by the Ministry of Health and Social Protection. The concessionary contract is implemented by the laboratory NETWORKS company. http://opencorporates.al/sq/nuis/L91923002T The contract was signed in 2019 with a consortium consisting of a union of operators like Labopharma Sh.p.k & Exalab France & AB Laboratory Solutions B.V. For the period 2021-2023, payments envisioned as budgetary support for this contract, and covered by public funds are estimated at 6 923 565 000 (six billion and nine hundred and twenty-three million and five hundred and sixty-five thousand) ALL.

The concession/PPP for the medical checkup of the population aged 35-70 is planned to be paid during 2021 in an amount of 876 090 000 (eight hundred and seventy-six million and ninety thousand) ALL, or 6% of the planned total cost for 2021.  This contract is signed by the Ministry of Health and Social Protection. This concessionary contract is implemented by 3P Life Logistic. The contract is signed in 2015. For the period 2018-2023 payments envisioned as budgetary support covered by public funds are estimated at 5 256 523 000 (five billion and two hundred and fifty-six million and five hundred and twenty-three thousand) ALL.

Another concession contract that is active and covered with public funds is the one entitled “The construction, operation and maintenance of the Milot-Morine Road”. The projected value for this contract in 2021 is 800 259 000 (eight hundred million and two hundred and fifty-nine thousand) ALL, or 5.5% of the planned total cost for 2021.  This contract is signed by the Ministry of Infrastructure and Energy. This concessionary contract is managed by the concessionary company “ALBANIAN HIGHWAY CONCESSION”. The contract is signed in 2016 with the consortium ‘Catalyst Viva Das General Contracting LLC, Salillari, sh.p.k, Bee Tech-Violiap Ateve and Kastrati, sh.a’’. For the period 2019-2023, payments envisioned as budgetary support covered by public funds are estimated at 3 704 262 000 (three billion and seven hundred  and four million and two hundred and sixty-two thousand) ALL.

The next active contract in 2021 covered with public funds is the one entitled the Concession/PPP (Provision of the Dialysis Service in 5 regional hospitals). The projected value for this contract is 779 000 000 (seven hundred and seventy-nine million) ALL, or around 5.4% of the planned total cost for 2021.  This concessionary contract is managed by the concessionary company “DiaVita”. The contract is signed in 2016. For the period 2018-2023 payments envisioned as budgetary support covered by public funds are estimated at 4 475 539 000 (four billion and four hundred and seventy-five million and five hundred and thirty-nine thousand) ALL.

Another concessionary contract is the one entitles The construction, operation and transfer of the incinerator for processing of Fier urban waste. The projected value for this contract is 752 770 000 (seven hundred and fifty-two million seven hundred and seventy thousand) ALL, or about 5.2% of the planned total cost for 2021.  This concessionary contract is managed by the company Integrated TechnologyWaste Treatment Fier. The contract is signed in 2016. For the period 2018-2022, payments envisioned as budgetary support covered by public funds are estimated at 3 763 852 000 (three billion and seven hundred and seventy-three million and eight hundred and fifty-two thousand) ALL.

An active concession project in 2021 is the one entitled “For improving educational infrastructure in the municipality of Tirana. The projected value for this project is 658 325 000 (six hundred and fifty-eight million and three hundred and twenty-five thousand) ALL, or about 5% of the planned total cost for 2021. There are currently two contracts to improve educational infrastructure through PPP concessions (known as the concessionary schools). The contract for improving the educational infrastructure in Tirana Municipality in Zone is implemented by concessionary company Z.M.A. The contract is signed in 2018 with the winning group of operators, including: GI KONS shpk, MET ENGENEERING shpk and ZENTI&CO. This project is covered by the contract “For improving educational infrastructure in the municipality of Tirana in Zone 4. This contract is implemented by the concessionary company Tirana 4. The contract was signed in 2020 with the concessionary group of companies consisting of:  The Union of economic operators: Alba Konstruksion shpk, FUSHA, ED KONSTRUKSION, ERZENI/SH, SON Engineering & Construction and A & E ENGINEERING sh.p.k. For the period 2020-2023, payments envisioned as budgetary support covered by public funds for the project are estimated at 4 649 443 000 (four billion and six hundred and forty-nine million and four hundred and forty-three thousand) ALL. This project is supported through the interim tax for improving educational infrastructure, tax paid only in Tirana municipality.

Construction and operation of the access road to Yacht Port – Orikum-Dukat Bypass (St. Elise Bridge) The projected value for this contract in 2021 is 393 979 000 (three hundred and ninety-three million and nine hundred and seventy-nine thousand) ALL, or about 3% of the planned total cost for PPPs for 2021.  This contract is signed by the Ministry of Infrastructure and Energy. This concessionary contract is managed by the concessionary company “Orikum – Llogara Road”. The contract is signed in 2019 with “GJIKURIA” sh.p.k. For the 2020-2023 payments envisioned as budgetary support covered by public funds are estimated at 2 903 318 000 (two billion and nine hundred and three million and three hundred and eighteen thousand) ALL.

The construction and operation of Milot-Baldren Road is another active concessionary contract, which means costs to the budget. The projected value for this contract is 65,000 (sixty-five million) ALL.  This contract is signed by the Ministry of Infrastructure and Energy. This concessionary contract is implemented by BARDH KONSTRUKSION company. The contract is signed in 2019 with the company NK sh.p.k as the concessionary, and “BARDH KONSTRUKSION” as the concessionary company. For the period 2020-2023, payments envisioned as budgetary support covered by public funds are estimated at 1464 945 000 (one billion and four hundred and sixty-four million and nine hundred and forty-five thousand) ALL.

The construction, operation and transfer of incinerator for urban waste processing of Elbasan Municipality is the other concessionary contract to be active in 2021 and supported by public funds. The projected value for this contract is 49 124 000 (forty-nine million and one hundred and twenty-four thousand) ALL.  This contract is signed by the Ministry of Infrastructure and Energy. This concessionary contract is implemented by ALBTEK ENERGY company. The contract is signed in 2014 by the former contracting authority, the Ministry of Environment with Albtek Energy company and is amended in 2015. For the period 2018-2021, payments envisioned as budgetary support covered by public funds for the project are estimated at 2 033 626 000 (two billion and thirty-three million and six hundred and twenty-six thousand) ALL.

Passports are created in the  OpenCorporates.Al portal for every concessionary PPP company and their owners. Through the Concessionary Companies, 274 such companies can be listed and viewed (registered as of February 2020).

Concession and PPP Contracts, in force, data, and Documents on Companies Registered for their Implementation, are published in an easily accessible and well-structured format under the OpenCorporates.al. portal, Concession Register Database. The Excel document of this article contains data and information on the basis of which the visualization is done. This document is easily downloadable and free to use. Other databases of the AIS Organization include: spending.data.al; OpenPocurement.al, and Open Corporates.al

This article was drafted and published in the framework of the “Open Data, Access and Transparency over sectors exposed to Risk of Corruption” project. The latter is financially supported by SIDA – Sweden International Development Cooperation Agency

Download excel: 2021 Budget Public Costs envisioned for Private Public Partnership (PPP) Concessions
Comment and Analysis: Open Data Albania
Translated by: Etleva Kondakçi