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Kiev municipal transport receives a €100 million EBRD financing
Major upgrades of metro, bus and trolleybus passenger transport to take place
In its first long-term financing for municipal transport in Ukraine, the European Bank for Reconstruction and Development is providing €100 million to municipal transport companies Kiev Metropolitan (metro) and Kiev Pastrans (buses and trolleybuses).
A €40 million loan to Kiev Metropolitan will finance up to 15 new metro trains, which will operate on the Syretsko-Pecherska Line, while a €60 million loan to Kiev Pastrans will finance up to 225 new trolley-buses and up to 125 diesel buses and associated infrastructure. 40 per cent of each loan will be syndicated to commercial banks DEPFA Investment Bank Ltd, Dexia Crédit Local Dublin Branch and HYPO Investmentbank AG.
In the rapidly growing Ukrainian capital with 2.7 million residents, the financing should significantly improve efficiency and overall quality of local transport, stressed Kamen Zahariev, EBRD Director for Ukraine. According to him, with this transaction EBRD continues to support environmentally clean and sustainable public transport alternatives to increased private car usage.
“The project builds on the EBRD’s expertise in structuring new infrastructure projects in partnership with municipalities, providing an example that other financially sound transport companies and municipalities in Ukraine and the region can follow”, said Oxana Selska, EBRD Senior Banker,.
Technical co-operation funds, provided by the governments of France and Italy, have been used to help the companies to prepare technical-feasibility studies, develop long-term business plans, conduct financial audits and develop pilot public service contracts between the city and the companies. Such contracts will be instrumental in helping to establish a transparent structure and in fostering the development of new standards for the provision of public transport. Additional technical co-operation advice will be provided to the city on electronic ticketing system.
Leonid Chernovetsky, Mayor of Kiev, said the city’s strong economy is a result of good local businesses and growing foreign investment, and to boost this further, the city needs to improve local transport infrastructure. “The EBRD has a good reputation for working with local municipalities in central and eastern Europe, and we want to build on that to achieve our objectives”, he added.
The European Bank for Reconstruction and Development is the biggest financial investor in Ukraine. As of the end June 2007 it had committed over €2.9 billion through more than 140 projects.
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