Prague - At least for the next ten years, the capital city will have almost no resources for non-transport infrastructure projects. Prague currently owes billions of korunas for three mega-investments, and this debt paralyzes the city budget.
Every year, Prague spends almost half of its budget on transport infrastructure projects. The costliest projects are the Blanka tunnel, the purchase of 15T trams, and the extension of the A line of the Prague metro. These projects will cost in total CZK 80 billion (EUR 3.1 billion). The EU has contributed only between CZK 7 billion and CZK 8 billion to the Blanka project, the remaining cost is financed from the Prague city budget.
In 2012, Prague city budget allocated CZK 12 billion (EUR 470 million) to investments - half of the sum went to large transport infrastructure projects, almost CZK 5 billion was spent on the construction of the Blanka tunnel.
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This year, Prague has only slightly over CZK 9 billion for investments. And, as previous year, half of the sum will be allocated to Blanka. "If everything goes well, Blanka will be paid for in four to five years," said Prague City Hall's Financial Committee Chairman Jiri Vavra (TOP 09).
Moreover, the city-owned Prague Public Transit Company (DPP) has taken a loan to pay for 250 new T15 trams it ordered. According to Vavra, the DPP will have to have repaid CZK 22 billion by 2018 for the purchase of the new trams. "We expect that Prague will have to pay CZK 11.8 billion from its budget to amortize these debts," said Vavra. And even with this financial support, the DPP will have problems repaying its debt.
The European Investment Bank (EIB) has granted Prague a CZK 6 billion loan for the extension of the Prague Metro's A line, and the city plans to borrow another CZK 5 billion. The project's total cost is estimated at CZK 22.5 billion, and the European Union will not pay more than CZK 8 billion.
Prague estimates that the operating costs of the Blanka tunnel and the metro's A line will be CZK 250 million per year and CZK 300 million per year, respectively.
