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EBRD invests US$ 54 million in Lithuanian Railways
Bank, EU work closely with Lithuanian authorities to support restructuring
The European Bank for Reconstruction and Development is lending US$ 54 million to Lietuvos Gelezinkeliai (LG) to help finance the rehabilitation of 155 kilometres of mainline track, and to accelerate the restructuring of the rail sector in Lithuania.
The US$ 112 million project, developed in cooperation with the European Union's ISPA programme, will enable LG to renew track in two key sections of the rail network -- between Vilnius and Kaliningrad, and between Vilnius and the port of Klaipeda. The sections form part of the pan-European Corridor IX, one of ten routes highlighted by the European Commission as important trans-European rail links. The EU is expected to provide an additional US$ 41.4 million for telecommunications, signalling and power supply, and to reinforce bridges and important structures along the line. LG will provide US$ 16.3 million to replace and upgrade track.
The EBRD loan will help provide fast and reliable freight transportation service on the international rail route linking the Baltic Sea and western Europe to Russia, and enhance the competitiveness of LG within the country's freight industry, said Matti Hyyrynen, head of the EBRD's office in Lithuania. The EBRD is committed to supporting the country's rail sector, and will work closely with LG to implement this project, Mr Hyyrynen added.
Lithuania's rail sector is at a crucial stage of transition, and this project will help it become more commercially focused. "The EBRD, ISPA, LG and the Ministry have worked in close cooperation to ensure the development of this project," said Zigmantas Balcytis, Minister of Transport of Lithuania. "This loan is important not only for Lithuania's rail sector development in line with EU requirements, but also for Lithuania's successful integration into Europe and for economic development in general."
"This project will make us more competitive within the freight industry," said Albertas Šimenas, LG Director for Development. "It will help increase our efficiency and enable us to complete the upgrading of this key section of the pan-European network."
To date, the EBRD has invested around €400 million in 28 projects in Lithuania. In the transport sector, the Bank has invested around €2.3 billion in 66 projects.
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