The EIB invests €640 million to improve infrastructure resilience, public transport and road connections in Ukraine

The European Investment Bank (EIB) and the Government of Ukraine signed three loans totalling €640 million to foster the sustainable growth of Ukraine and the prosperity of its people. The operations are in line with the priorities of the Government of Ukraine and the European Union to support the long-term social and economic development of eastern Ukraine and integration of the conflict-affected regions as well as the development of sustainable municipal transport and the modernisation of the transport infrastructure in the country.

EIB President Werner Hoyer said: “The EIB is proud of our continuing contribution to the social and economic development of Ukraine in support of European Union policy in the country. Today, we are investing €640 million to overhaul and modernise infrastructure in conflict-affected eastern Ukraine, to improve the quality and reliability of public transport in up to 20 cities in the country, and to modernise 183 km of roads in eastern Ukraine’s Luhansk Region. This means the people of Ukraine will benefit from modern, safe and fast connections and the new business opportunities they bring. Refurbished schools, hospitals and public services will also help the country to recover faster from the pandemic and to increase its economic resilience.”

€340 million to boost infrastructure resilience in Ukraine

The €340 million loan will support infrastructure rehabilitation and improve living and business conditions in conflict-affected regions of eastern Ukraine including oblasts that host a significant number of internally displaced persons (IDPs). Several hundred small to medium-sized projects will be financed at the municipal level to restore social infrastructure, improve public utility services and repair damaged administrative buildings and other key social infrastructure, including hospitals, schools, kindergartens, post offices, street lighting, sewerage systems, municipal transport, and relevant transport infrastructure. The loan will benefit some 13.7 million people, boost regional development and promote faster economic growth in Ukraine.

Under the €340 million loan, the Ukrainian-controlled areas in the Donetsk and Luhansk regions, as well as the neighbouring Kharkiv, Dnipropetrovsk, Kherson and Zaporizhia regions and city councils in other regions of Ukraine that are accommodating significant influxes of internally displaced persons (IDPs) will receive hands-on support to mitigate the effects of the conflict.

€15.2 million in EU grants will support the EIB loan with technical assistance in project preparation and management. In particular, a €7 million grant from the EU Neighbourhood Investment Platform (NIP) will support the programme’s preparation and implementation. An additional €8.2 million grant from the EU Delegation to Ukraine will support advocacy, help raise awareness among final beneficiaries, and assist them in preparing tenders and monitoring construction works, etc.

€200 million to improve public transport for Ukraine

Up to 20 medium-sized and large cities in Ukraine will improve public transport as the EIB loans €200 million to the Ministry of Infrastructure. The loan from the EU bank will improve the connection between the cities in the region of Azov Sea in eastern Ukraine with the rest of the country, increasing the standard of living for some 10 million people.

Benefiting from the loan, Ukrainian cities will modernise their electric public transport rolling stock (trams, trolleybuses, metro coaches, and electric buses), rehabilitate, and construct new public transport infrastructure (e.g. tram lines, trolleybus lanes, sub-stations and depots). Safer, more comfortable, and environmentally-friendly vehicles will improve the service level and increase the attractiveness of public transport. The operation will also help reduce congestion and promote public transport as an effective and comfortable alternative for commuters.

€100 million to improve road connections in eastern Ukraine

The EIB is investing €100 million to modernise 183 km of roads in eastern Ukraine’s Luhansk Region. Citizens and businesses in the region will benefit from a modern road network along the Troitske-Severodonetsk-Starobilsk route.

Investment from the EU bank will improve connections with eastern Ukraine’s Luhansk Oblast, home to some 2 million people. The people of Ukraine will benefit from reduced travelling times and vehicle maintenance costs, and improved road safety. The World Bank will provide $100 million in a parallel financing loan to support the Eastern Ukraine: Reconnect, Recover, Revitalize (3R) project.

The EIB will finance the rebuilding of road infrastructure, installation of intelligent transportation system (ITS) equipment, such as weigh-in-motion stations, and investment in other road safety measures. Investment will also enhance conditions for living and doing business in eastern Ukraine by better integrating the regional agriculture sector into the national supply chain.

Original source: EIB