The Argentine government has - for the first time since the High Speed Line between Buenos Aires and Cordoba had been awareded to Veloxia - admitted that there is no sufficient funding for the project. Ricardo Jaime, minister of transport, announced that the project (which was projected to cost $ 4.000 bn, but whose nominal value was much more than that) is currently on hold.
As part of the international crisis and little chance of getting a loan, the minister acknowledged that there is no funding, but said that "the work will be reactivated if they get the necessary funds." He further remarked that "it is a decision taken by the executive branch." Ricardo Jaime emphasized that despite the financial crisis, the high speed line project in Brazil "has just announced that there are three groups involved in the construction of a high-speed train between San Pablo and Rio de Janeiro."
The postponement of the work does not provide a legal problem for the country.
The agreement provides that, before a financial problem unrelated to the parties, it can be postponed without penalty to anyone.
Anticipating the announcement and following rumors, on the 15th of March Alstom (as leader of the Veloxia consortium) sent its vice-president to negotiate compensation for the detention of the work. For now they have been awarded of the extension of the tram from Retiro to La Boca La Boca valued $ 70 million.
The other high speed train project, linking Buenos Aires to Mendoza, is also delayed by the lack of funding. The work would take $ 10 billion, although the preliminary budget set by the government was $ 8.328 million. The first deadline for bids expired on technical and economic ground September 30, 2008. The Kirchner administration, aware of the crisis and the lack of credit for those interested, extended the deadline until June 10, 2009.
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