EBRD provides €450m loan for Ukraine’s road infrastructure
The European Bank for Reconstruction and Development is providing a €450 million (about $551.4 million) loan to the Ukraine state road agency Ukravtodor.
The funds will be used to finance the rehabilitation of sections of the M05 Kyiv-Odessa road and the construction of a new northern bypass around the city of Lviv. Both are part of the Trans-European Transport Network (TEN-T) and of strategic importance for Ukraine’s domestic and international connectivity, in particular with the European Union.
Under the project, the government of Ukraine is committing to enhance Ukravtodor’s procurement system and to strengthen its internal controls, policies and procedures to prevent bribery and corruption.
The EBRD financing for Ukravtodor will consist of three tranches. Tranches I and III totalling €290 million will support the rehabilitation of 275km of the M05 Kyiv-Odessa road, connecting the capital and the Black Sea ports. The highway is part of TEN-T Corridor IX, a critical road link connecting northern and southern Europe. Meanwhile, the €160 million Tranche II will finance the construction of a 24km northern section of the circular bypass around Lviv, the largest city in western Ukraine. The city has four international highways passing through it, two of which are part of TEN-T Corridors III (Brussels-Kyiv) and V (Venice-Kyiv).
Citizens of Lviv will benefit from reduced travel time and an improved environmental situation in the city as the new bypass will help relieve long-distance transit traffic running on the existing southern bypass and through the city centre. In addition, EBRD funds will finance strategic road safety assessments across the national road network to identify and prioritise high-risk sections and implement relevant mitigation measures. Funds will also be used to introduce systems to manage the impact of overweight vehicles.
