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German efficiency in doubt after airport debacle

By Erik Kirschbaum

BERLIN (Reuters) - Germans take pride in their engineering and organisational skills but their country's reputation for efficiency has been exploded by a farcical series of delays in building Berlin's new international airport.

Although the postponements in opening what is ostensibly a completed marvel of architecture have drawn the most attention, Germany's stifling bureaucracy, red tape and planning rules have also blighted dozens more big projects.

The embarrassing and expensive delays in multi-billion euro projects such as Berlin's airport, Hamburg's new opera house, Germany's BND spy agency headquarters, Cologne's underground, Stuttgart's train station, and thousands of kilometers of overhead power grid are no laughing matter for a country whose reputation for engineering excellence is a major selling point.

Because Germany relies on exports for more than half of its national wealth, its inability to complete these major infrastructure projects even close to on time or within budget has badly tarnished that carefully cultivated reputation.

"We haven't exactly covered ourselves in glory with the Berlin airport and these other big construction projects," said Michael Knipper, managing director of the Federation of the German Construction Industry.

"The biggest problem in Germany is the bureaucracy," Knipper said in an interview with Reuters. "I don't know of any other country in Europe that has anywhere near as complicated and expensive an approvals and building process as Germany."

The Willy Brandt International airport in Berlin was already nearly two decades in the planning and hopes for completion in 2007 and then 2008 were already outdated when construction began in 2006. Its opening has been pushed back at least four times since then from 2011 to June 2012 then to March 2013, then October 2013 and now to some indefinite point after 2014.

'WILL DEFINITELY OPEN ON TIME'

Back in January 2012, at the annual New Year's party at the new airport's construction site, a jubilant Berlin Mayor Klaus Wowereit went out of his way in a speech to scold critics who warned the airport would not open on time five months later.

"We can say with great pride that the new airport will definitely open on time on June 3, 2012," he said in front of a clock counting down "131 days til opening". "That's the truth." Famous last words for which Wowereit has been duly pilloried.

The cost of the airport, which will replace three smaller Berlin airports, has doubled to 4.3 billion euros ($5.6 billion) due mostly to the delays, which are mainly the result of problems with an inadequate fire-safety system.

The most embarrassing delay from June 3, 2012 to March 2013 came just four weeks before the scheduled grand opening when one local authority in charge of the fire-safety system simply refused to give its approval.

The grand opening party at the terminal for 40,000 had to be cancelled, plans to close the city's 64-year-old inner city Tegel airport were shelved at the last minute and the carefully planned overnight move from Tegel to Willy Brandt was scrapped.

The airport's 15-seat supervisory board, packed with 10 politicians such as Wowereit rather than construction experts, was blamed for failing to oversee the fire-safety issue more rigorously while reportedly paying more attention to matters such as upgrading the veneer to an elegant walnut and switching the floor tiles to a more stately and expensive limestone.

"The supervision and control of the Berlin airport construction has been incompetent," said Manuel Rene Theisen, a professor of business administration at Munich University, an expert on the airport. "It's the result of political meddling.

"Instead of hiring a general contractor to oversee it all as they should have, political leaders put themselves in charge and the outcome is a disaster," Theisen told Reuters. "It's turned Berlin into a laughing stock and it's damaged Germany's reputation.

"Germany has a reputation for efficiency but you can lose your good name with bad things like this."

That is indeed a most worrying aspect for many Germans. At first the postponements of the Berlin airport were more of a source of bemused derision inside Germany about the northeastern capital city that many in the south and west love to hate.

But the series of lengthening delays is now turning out to be more than a joke or a slight inconvenience for travelers.

HITS GERMAN PSYCHE

In a country where modern national heroes are in short supply in part due to its belligerent 20th century past, the airport and other debacles have hurt an important part of German national pride -- construction and engineering.

Germans exude a sense of superiority when it comes to the way they make their machines and buildings.

"What should have been a flagship project is turning into a source of shame," wrote the conservative Frankfurter Allgemeine Zeitung newspaper in an editorial.

"Not only in Germany is there a sense that Germans can't do big construction projects on time any more but also abroad doubts are growing about German reliability," it wrote.

Theisen and Knipper at the Federation of German Construction Industry say a big part of the problem with the Berlin airport and other infrastructure projects is that the public sector - elected officials - are often in charge and have an eye either on their re-election or creating monumental buildings.

"It's seldom the case that public sector has the qualified people with the necessary expertise for big projects," Knipper said. "Sometimes public authorities turn over their projects to general contractors. Sometimes they don't. Berlin didn't want to turn it over to a general contractor. That was a mistake."

Unlike in other countries, there are almost no public-private partnerships on major construction projects in Germany, due to regulations, Knipper said.

By contrast, private sector projects are generally finished on time and on budget, he said. And it wasn't always like this. It only took 90 days in 1948 at the start of the Cold War to build Tegel, an airport vital to the success of the Air Lift.

OTHER HEADACHES

The new Berlin airport is only the latest and most high-profile example of big public infrastructure projects plagued by extremely long delays and high cost overruns. Some of the other public projects causing headaches include:

- Hamburg's Elbe Philharmonic Concert Hall. The opening has been delayed by about three years to 2017 and the costs have risen from 77 million euros in 2007 to 575 million euros.

- Stuttgart central rail station. The project was started in 1994 but it took until 2010 for construction to begin due to long planning delays. Further delays due to a controversy over the demolition of the existing station caused a political upheaval. It won't be finished until 2020. Costs will rise from 2.4 billion euros in 1998 to 6.8 billion euros currently. Some experts see the bill climbing to 11 billion euros.

- Cologne underground. Work on a 1.l billion-euro underground train line has been interrupted repeatedly by accidents, including the collapse of a nearby building. It was supposed to be finished by 2011 but completion is now not expected until 2018.

- The BND intelligence agency building. The building with offices for 4,000 staff -- spread out over the size of 35 football fields in the middle of Berlin -- was supposed to be finished in 2011 but that has been delayed to 2015. The cost nearly doubled to 1.4 billion euros. Some experts see costs hitting 2 billion euros.

(Reporting by Erik Kirschbaum; Additional reporting by Vera Eckert and Christoph Steitz in Frankfurt; Editing by Giles Elgood)

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