Construction of Gas Connection Between Bulgaria and Serbia Becomes More Expensive Due to Inflation

Source: Politika Monday, 06.03.2023. 11:01
Illustration (Photo: Altmann)Illustration
The project of the construction of the gas connection between Bulgaria and Serbia, due to the delayed procedures, will grow considerably more expensive. The annex to the agreement published in the Register of Public Procurement Procedures clearly shows that the agreed price of EUR 71,674,896 million without the VAT will increase 32.6% to EUR 94,028,441. This price increase by more than EUR 22 million is a consequence of the 2022 inflation and has been calculated using the methodology for the indexation of public procurement procedures, adopted at the end of last year by the cabinet of the president of Bulgaria, Rumen Radev, Politika reports.

According to the methodology adopted by the president’s cabinet, the agreements are indexed using the formula which uses the index of producer prices in the local building material market as the base. According to the National Statistics Institute, if this index was around 108 points at the beginning of 2021, at the end of 2022, it was already over 230 points. If the coefficients for various construction categories are taken into account as well, the price increase in the construction sector amounts to 60-75%.

The realization of the project began at the end of January this year and the completion deadline period is 300 days. In the first three months, the index of the prices of local producers of construction materials will be higher than in mid-2022. The structure should be completed by the end of the year.

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