Go to mobile


23:42 22-03-2017
Norway permits one of Russia’s richest man to develop Dvalin gas field
22:49 22-03-2017
Stroytransneftegaz built 50% of its Power of Siberia’s section ahead of schedule
22:08 22-03-2017
Ukrainian companies to be supplied with coal from South Africa
21:30 22-03-2017
British millionaires predict positive effect of Brexit on their capital
20:07 22-03-2017
Xiaomi opens second plant for smartphone production in India
19:14 22-03-2017
Russia's first cinema with a cylindrical screen to appear in Zaryadye Park
17:46 22-03-2017
Russia ready to cooperate with all partners over Nord Stream — Putin
17:21 22-03-2017
Russia and Egypt plan to prepare contracts for El-Dabaa NPP within two months
17:03 22-03-2017
UPS builds new terminal in Salt Lake City
16:48 22-03-2017
Businessmen strive to invest in Golf Resort in Gelendzhik
16:13 22-03-2017
Chairman of BASF to discuss with Vladimir Putin company’s operation in Russia
15:53 22-03-2017
Copy of Reichstag to be built in Russian Patriot Park by April 23
15:10 22-03-2017
Rosatom plans to produce 3D-printer of new generation by year-end
14:29 22-03-2017
Wintershall considers options for support of Nord Stream-2 project
13:48 22-03-2017
$87м medical cluster to be built in Moscow region within three years
12:55 22-03-2017
Japanese rehabilitation center to open in Russian city of Vladivostok this year
12:17 22-03-2017
Cottage of Russian billionaire robbed in French resort of Courchevel
11:29 22-03-2017
Mysterious ancient artifact found at Kerch Bridge construction site
10:36 22-03-2017
Greenhouses for year-round strawberry production set up in Khabarovsk region
09:41 22-03-2017
Russia to sign contracts with India on supplies of 48 Mi-17V-5 helicopters
19:40 21-03-2017
Moscow park may be named after Croatian city of Zagreb
19:20 21-03-2017
USA and Russia discuss project for Venus exploration
18:58 21-03-2017
Gazprom and Eni agree on gas supplies via Southern Corridor
18:27 21-03-2017
Dutch scientist develops concept for circular airport runways
17:55 21-03-2017
Russian region of Sverdlovsk and India to cooperate in water purification projects
17:28 21-03-2017
Belarusian President calls on to create new energy sources instead of gas and oil
17:14 21-03-2017
FSB conducts searches in St. Petersburg in new case over Presidential residence fraud
16:35 21-03-2017
Rosatom agrees on promotion of radiation technologies in Latin America
16:08 21-03-2017
$17,5m logistic hub to be built to facilitate trade between Russia and Kazakhstan
15:34 21-03-2017
Marriott sets to open 12 new hotels in Russia
All news


«    March 2017    »

Kerch Bridge: a scandalous project

logo russianconstruction.com
Kerch Bridge: a scandalous project

“Stroygazmontazh” and the Ministry of Construction cannot agree on financing the project.

Another scandal has come about regarding the Kerch Bridge. This time, the project finance’s stability is in doubt.


The scandal in the media arose after Forbes’s publication on June 8th of the fact that the construction has stopped being financed. The edition referred to the letter from the Director General of the “Stroygazmontazh” (SGM) company-contractor, Andrei Kirilenko, to the Ministry of Transportation (Mintrans) and Rosavtodor GC.  

The institutions’ press-offices reacted quickly, claiming there were no problems with the financing. What’s going on? Hardly had the “Crimean Bridge” information center reported that the 1,000th pile had been driven into the foundation of the Kerch Bridge, when information that further work had become impossible appeared in the media.

Kerch Bridge: a scandalous project

It turned out that Mr Kirilenko had actually written a letter on the problems of financing the construction of the flyover across the Kerch Strait. The letter was sent to the First Deputy of the Minister of Transportation, Evgeny Dietrich, and the Head of Rosavtodor, Roman Starovoit, on May 27th. He wrote to the high-ranking officials that, due to the absence of money, the enterprise was not able to keep up the rate of construction and needed to invest money in the necessary equipment. According to Kirilenko, the authorities had not been able to solve the problem of financing since the beginning of the year - money was last transferred to SGM in December, 2015.

All in all, the company has received 48.9 bln roubles, and this year it was due to reach 65.4 bln roubles. The reason for the payment delay, as determined by Kirilenko, is the peculiarity of the bank and planned fiscal support. It should be mentioned here that to exclude the non-purpose use of the budget finances, all statutory construction projects have been switched over from extended banking servicing to treasury banking. The same concerns have arisen over the project of the Kerch Bridge construction.  

However, according to TASS, the Ministry of Transportation rejected the idea of financing problems.

– The money for the project’s implementation in 2016 has been allotted from the federal budget, the ministry claimed. – The expenditure of the money will start after the state contract is switched over to treasury servicing. The corresponding documents have been sent to the RF Government for consideration. The amendments will be approved by the end of July.

Kerch Bridge: a scandalous project

Rosavtodor, according to Mintrans, has affirmed that all the calculations have been agreed upon in the contract. –Work financing is being carried out according to the conditions of the above-mentioned contract. Any problems connected with the construction financing of the bridge across the Kerch Strait are false, snapped the agency.

Whatever may be the case, there was a great to-do. Journalists even came at the press-secretary of the RF President, Dmitry Peskov, who said that he knew nothing about these problems.  However, he stressed that the project is under the President’s tight grip.  –Even if there are some wrinkles, they will be no doubt smoothed over as soon as possible, Mr Peskov claimed.

On June 8th our editorial team sent a letter to the “Crimean Bridge” information center, asking for them to comment on the situation. In their reply, with reference to the FSI “Taman” Federal Automobile Roads Department of the Federal Road Agency, they said that the construction of the bridge across the Kerch Strait was being kept to schedule. The work is developing, the supports are being constructed, the equipment and employees are working. Not a word was said about financing or any problems with the authorities’ representatives. So everything is good… It's beginning to feel like all this ado is to attract attention to the statutory project having developed some level of complexity.  

At the same time, we think that the leakage of the letter to the liberal Forbes came from within federal structures; from “Stroygazmontazh”, most likely. The aim is evident: to attract attention to the necessity of a fast solution to the problem of switching over to treasury financing.  

But if past experience is anything to go by, changing the game’s rules (including the financial rules) during the course of the game itself may mean trouble.

We’ll follow the financing of the Kerch Bridge construction attentively.



Related publications