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MFB to sign contract on Ft 45 bln ÁAK loan by early September

The state-owned Hungarian Development Bank Rt (MFB) will sign in late August or early September a contract to lend Ft 45 billion to the State Motorway Management Rt (ÁAK) to pay for motorway construction, daily Magyar Hírlap reported on Monday, citing MFB deputy-CEO Sándor Radics.

Radics said Minister of Economy and Transport János Kóka had approved the deal on Thursday.
A year earlier, the government decided to try to move motorway construction financing off-budget in a public-private partnership, with ÁAK acting as the state-owned private partner. ÁAK was to have signed a 75-year contract to operate many of Hungary's motorways and pay for the construction through the issue of Ft 750 billion in bonds. The EU statistics office Eurostat, however, rejected the scheme, saying the costs would have to remain part of central budget expenditures. The decision forced the government to scrap the idea, along with the bond issue.