Roads to nowhere.

• Author: Nutu, Ana Otilia
• Position: Report

While they have come a long way in the past seventeen years, Romania's road and rail sectors still face a serious capacity crisis, which has practically blocked the majority of investments and rehabilitation of infrastructure for more than two years. Roads and railways ensure together over 90% of the transport in Romania, with roads being increasingly the most important mode', reflecting the fact that transport networks in our country are based almost entirely on roads and railways.

But recent trends in this sector are particularly alarming, especially when we speak about government's capacity to develop and manage the sector's public infrastructure:

* a severe loss of previously existing human and institutional capacity, at a time when projects are expected to increase significantly,

* little (and diminishing) planning and programming ability in the public sector;

* a lack of strategic vision, massive political interference in what should be technical decisions;

* basic financial insolvency of the sector. Reforms need to be consistently enforced in order to create an institutional framework for the transport infrastructure which would ensure sustainability.

WHERE WE ARE

1. Romania's roads to join the EU?

   Overly simplistic and misleading comparisons are usually published which are based on network density indicators. According to this figures, Romania's road density is one third of EU-25 average, whereas the rail density is comparable with that of the EU.

   It is unrealistic to say that Romania's infrastructure should reach EU levels in 15-20 years. The need for transport in Romania is currently still much lower than in the EU. It grows faster than the economy as a whole, but will certainly still remain under EU levels for the following two or three decades. Therefore, the investment needs in the infrastructure should be driven mainly by the economic development perspectives of the country. It is also impractical to judge the road network simply in terms of motorway density compared to Western countries: it may very well be the case that Romania is simply not "mobile" enough to justify such a fast motorway development.

   What should really be judged here is how transport infrastructure can provide safe transportation at speeds that do not become bottlenecks for economic development. In this respect, what is really worrying is that Romania's national roads are by far the most dangerous in the EU. The number of fatalities per passenger*car is three times as high as the EU-25 average. While in Europe only one in 40 accidents ends with fatalities, in Romania the proportion is one in three (Fig. 1).

   Culprits are not just the irresponsible driving habits of Romanians, as hasty commentators put it much too easily, but also the black spots, the crossing of linear villages / towns / cities without proper mitigation measures against accident risks, and the small local traffic using national roads for lack of a better alternative.

   Black spots appear mainly because of the lack of maintenance. An evaluation in 2005 done by CESTRIN, the research arm of CNADNR, showed that around 30% of the national roads are in poor condition. This is caused by a serious backlog in maintenance, around 60% of the network needing urgent fixing or rehabilitation.

   In the rush to "absorb free EU money"--not very successful so far anyway--maintenance of existing infrastructure is often overlooked by the transport sector management, as well as by the public. On average, maintenance costs for roads are much higher in Romania than in neighboring countries, which reflects a lack of attention and public awareness to the importance of these operations. A recent World Bank report (2006) shows that potential savings on timely maintenance could be as high as 40%. In 2003-2004, CNADNR spent 0.5% of GDP on maintenance (cost per km is about EUR 20,500, significantly higher than EU-25 or US average). These overruns are caused by delayed works and inefficient spending. In practical terms, the maintenance backlog causes 60% of the road network to need rehabilitation (which is more expensive than regular operations), increases the cost of car repairs, raises safety issues to drivers, and reduces traffic speed. In addition to under-funding, maintenance is not properly prioritized, leading to further inefficiencies in spending. In the budget breakdown, an astonishing 64% of maintenance costs are administrative costs, such as salaries, and these is the only category which more or less keeps up with the sector's needs. For the other categories, budgetary allocations are just a fraction of the request, running from about a third (current operations) down to a mere 5% (repairs, see Fig. 3). In case prioritization is not done effectively, the non-financed part is very likely to add to the maintenance backlog.

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   Typical problems in the motorway program

   Another indicator that the public and the politicians are very sensitive about is the low density of motorways in Romania. Until now, the total motorway length built is 264 km. Comparatively, Portugal has around 1,500 km at half the population and 40% of land area.

   However, SAR believes this indicator indeed very visible and easy to understand by experts and non-experts alike--should be employed only with great care as a measure of performance of the transport sector. A thorough analysis should balance both the advantages and the costs of building motorways. Each extra 100km of highway creates additional financial and institutional commitments for proper maintenance and operation, and we are currently seeing what difficulties the authorities face in keeping up with their obligations even on the existing 264 km. What is more, an excessive investment program would divert the attention and capacity of CNADNR, distracting it from projects with higher priority but less sex-appeal, such as the rehabilitation program in stages and the maintenance plans.

   A common argument for building motorways is indeed the high traffic on specific sections of roads. However, national roads are packed with traffic that shouldn't be there in the first place: carts, bicycles, inter-village small vehicle traffic. Much of this traffic would rather use local or county roads, with no high-speed traffic and less risks of accidents. They enter the national network simply because the lower class roads are in a really bad condition, or do not exist at all.

   So, instead of focusing excessively on the building motorways, the Romanian Government should pay more attention to lower class roads rehabilitation and maintainance, to reduce traffic on national roads with a negligible cost compared to that of building a motorway. Technically, this could be done very easily: County Councils should sign contracts with the DRDPs (regional branches of CNADNR), in the same way the Ministry of Transportation has a concession contract with CNADNR.

   The DRDP would only manage the local/county roads, the physical infrastructure remaining the property of the local authority, just like the national roads are property of MT. DRDPs would gain certain economies of scale and could coordinate nation-wide the access from local/county roads to the national roads network. In terms of staff, DRDPs could immediately hire the roads experts who work currently in the relevant departments of local authorities. Taking this type of local traffic off the national roads would reduce substantially the number of serious accidents.

   Another argument for carefully pondering the built of new motorways is their prohibitive cost. This cost per km in Romania is extremely high, in part for good reasons: extreme seasonal variations of temperature, difficult terrain and expensive land, particularly in Transylvania and near large cities. The average cost of the Bucharest-Brasov motorway is as high as 15 mil [euro] /km (the highest will be on Comarnic-Predeal section, where aqueducts have to be built at a cost reaching 26 mil [euro]/km). Comparatively, a motorway in Poland or Hungary does not exceed in general 7-8 mil [euro] /km.

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   The Sibiu-Pitesti motorway--a section created by extending the European corridor IV after tough negotiations with the EU--will cost more than 13-14 mil [euro]/km, because of potentially high environment costs and difficult conditions. While EU and EIB would have financed the construction, the Romanian Government decided to use a design-build-operate type of contract for this motorway. EU is reluctant to finance such a contract (2), but the Government stuck to its idea, even if that meant the additional inclusion of Pitesti-Sibiu on the list of future public-private partnerships (PPP), and the shift of the EU grant from Pitesti-Sibiu to the section Timisoara-Lugoj instead. The argument for a design-build-operate contract is that the building company is interested in a high quality investment to have fewer headaches with its maintenance and operation later on.

   Even existing motorways, although very short, have had their share of scandals in the media. The A1 motorway (Bucharest-Pitesti) was rehabilitated by EBRD in the late '90s, but the materials used for construction proved later not to be the best technical solution (Fig. 4). Romania's harsh climate, with high variations of temperature summer-winter and difficult operation conditions during blizzards, were not entirely factored in by the designers. As a result the motorway was repaired many times and was closed partially for various intervals over the last years.

   However, the private sector cannot be interested in the costly Sibiu-Pitesti motorway without Government support. Since the traffic on this particular section will probably consist mainly of traffic between Pitesti and Sibiu (no significant traffic could be attracted from other routes), the only way to sustain the construction would be state support in form of shadow tolling / "availability fees". This is a...