Treasury renews talks on light-rail project

Gov't has "firm intentions" of completing NIS 11 billion Tel Aviv light-rail project.

By SHARON WROBEL
July 9, 2010 06:24
1 minute read.
Light rail in Jerusalem

Light rail in Jerusalem 311. (photo credit: Sybil Erlich)

 
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The government has agreed to renew talks with representatives of Metropolitan Transportation Solutions in a last-ditch effort to complete the NIS 11 billion Tel Aviv light-rail project.

“We have a firm intention to have a light railway to Tel Aviv, and we hope to close a deal with a private company to build and operate the project,” Accountant-General Shuki Oren said Thursday. “But we will still are leaving the option open to apply alternative solutions and to nationalize the project if talks with the private contractor fall through.”

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The Finance Ministry agreed to hold marathon negotiations with MTS during July to finalize financial details on the project.

“After the private contractor understood we are serious about canceling the agreement and applying alternative solutions to develop the project, it retreated from previous conditions,” Oren said. “As a result of this progress, we agreed to another attempt to come to an agreement on financial arrangements of the project and to enter into intensive negotiations.”

The Finance Ministry said at the end of May it was seriously considering alternative solutions.

MTS is jointly owned in equal parts by Israeli construction giant Africa Israel, Germany’s Siemens, the Egged bus cooperative, Chinese civil-engineering cooperative CCECC and Portuguese infrastructure firm Da Costa Soares.

The Tel Aviv light-rail project has been on hold since May 2008, when the global economic crisis and MTS lost its financing. It has since been stuck at an impasse due to the inability of the two sides to agree on financial terms.

Negotiations between the two sides have been frozen since March 16, when MTS sent a letter to Oren proposing solutions to the financial differences of opinion.

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The Tel Aviv light-rail project will be the largest infrastructure project ever undertaken in Israel. The first line, the so-called Red Line, is the backbone of the system. It starts in Petah Tikva, runs through Bnei Brak, Ramat Gan, Tel Aviv and Jaffa and ends up in Bat Yam.

The 23-kilometer line, half of it underground, will take about 45 minutes from one end to the other and is expected to carry

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