Negotiating European Subsidies for Public Transportation Projects: Strategies and Challenges

2023-11-17 18:11:05

It was in the air following the blockage concerning the award of the market for the extension to Seraing. The Region feared having to urgently negotiate with Tram’Ardent to reduce prices, launch the work, finalize the project before the end of 2026 and thus benefit from European subsidies. Given the persistent blockage, the Region has decided: the 105 million Europeans from the recovery plan are allocated to other projects. Europe has given the green light for them to finance the construction of the Mobi’Park in Tilleur, set to become the second largest TEC depot in Wallonia and for the purchase of 32 electric buses which will be used on the four busway lines .

Reduce pressure in negotiations

The Region was in a weak position in these negotiations. The price paid by the Tram’Ardent consortium to install the signaling, safety and communication systems on the extensions was excessive. The TEC and the Region cannot call on competition, because they want to maintain a certain technical unity on all the lines. All this, and the obligation to complete the project before December 2026 to obtain European subsidies, complicated the negotiations and placed the Region and the TEC in an unenviable position.

By deciding to allocate European funds to other projects, the Region and the TEC are reducing the pressure. They will be able to negotiate more calmly with Tram’Ardent. The extensions remain current, but they will be financed via Walloon money “nWe would obviously have preferred that European funds might be used for the tram. Unfortunately, the offers we have received are financially unacceptable. The government’s responsibility is to avoid an unacceptable budgetary impact. We cannot accept off-market prices. I repeat, we cannot take a risk for Walloon finances” comments the Walloon Minister of Mobility, the eco-friendly Philippe Henry, who claims to have considered this option since October 24.

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The priority: bringing the negotiations to a successful conclusion

The project for extensions to Herstal and Seraing took a hit, but it is not dead. “NOur priority is now to bring to a successful conclusion the negotiations between the TEC and Tram’Ardent to allow the realization of the extensions to Herstal, but also to Seraing, on the Walloon budget.” indicates the Minister.

These negotiations might last for some time as the file is complex. The mediation which saved the tram project in mid-2023 lasted 9 months.

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