Construction companies that were contracted to build highways in Spain are constrained by the rising national deficit, which has created a drop in demand for new roads and enthusiasm for infrastructure projects that lead nowhere.
Some of the companies are launching projects that were conceived based on traffic forecasts that were incorrect. The forecasts were done at a time when financing was easy and pushed by the Spanish national government.
If contractors fail in their investments, they should heed the law of the marketplace and waste no time searching for solutions.
Spain's Minster of Public Works, Ana Pastor, found the problem when she rose to her position and is proposing to resolve it through mergers. But that will be complicated, because the companies are resisting.
