Ukraine: EIB supports upgrade of energy and road infrastructure
24 May 2018
EIB funds will upgrade 12 electricity substations and develop modern energy communication system
Ukraine provides guarantees to private electricity utility company Ukrenergo for EIB loan
EIB and Ukraine sign MoU aimed at saving lives and reducing accidents on roads in five large municipalities
The European Investment Bank (EIB) is lending EUR 136 million to Ukraine’s National Power Company Ukrenergo in support of an extensive modernisation programme for its transmission infrastructure, helping to ensure that Ukrainian citizens and companies have a reliable source of electricity. The Ukrainian Government strongly supports this project as is evidenced by the agreement that it signed with the EIB today, under which it will provide guarantees to back the EIB loan.
The EU bank and Ukraine also signed today a Memorandum of Understanding to develop a Ukraine Urban Road Safety project that will provide infrastructure investment designed to improve urban road safety – a major issue for citizens in Ukraine and a priority for the Ukrainian Government. In addition, the EU intends to provide a EUR 4.25 million technical assistance grant to support the development and implementation of the project, ensuring that Ukraine has access to best practice in road safety.
The projects, which are backed by an EU guarantee under the EIB’s external lending mandate, are of particular significance as both the transport and energy sectors have been identified by the EU and Ukraine as key areas for cooperation.
EIB Vice-President Vazil Hudák commented: “Our lending operations in Ukraine, amounting to some EUR 5.5 billion, are fully in line with EU policies and help to foster progress in the country and deepen its cooperation with the European Union. Both projects will have a direct positive impact on the quality of life of Ukraine’s citizens, and will further develop Ukraine’s economy and strengthen its competitiveness.”
Prime Minister of Ukraine Volodymyr Groysman, who witnessed today’s signing ceremony in Brussels, stated: “The Government of Ukraine is keen to enhance cooperation with the European Investment Bank. This is why I, as Prime Minister, welcome the signing of today’s bilateral documents aimed at contributing to reforms in my country, in particular the upgrading of energy and road infrastructure.”
European Commissioner for Transport Violeta Bulc emphasised: “Road safety is a human rights issue: every life counts. A comprehensive approach, covering behaviour change, education, enforcement and infrastructure, is needed. We have developed expertise and commitment in improving road safety in the EU and are glad to share this globally with partner countries such as Ukraine. I am pleased that Ukraine and the EIB are signing today this important programme, which is also supported by EU funds.”
The EIB loan to Ukrenergo will finance the rehabilitation of 12 substations with operating voltages in the 220-750 kV range, located in the Dnipro power system in Ukraine. The EIB loan complements other IFI support aimed at rehabilitating the existing infrastructure and developing a modern fibre-optic communication system to protect, monitor and control the power grid, enabling remote control of all the concerned substations located across Ukraine.
The Urban Road Safety project will support municipal schemes focused on increasing road safety and improving access to public transport in five major cities in Ukraine: Dnipro, Kharkiv, Kiev, Lviv, and Odessa. The funds will be used to finance infrastructure investments to enhance urban road safety, develop IT solutions for safe and effective traffic management and create facilities for cyclists and pedestrians.
The European Investment Bank, the bank of the European Union, invested €554 million in 2021 in developing Ukraine`s transport infrastructure, urban mobility, education infrastructure, and the local economy, including support to increase COVID-19 resilience. Ukraine remained the main recipient of EIB funding among the countries of the Eastern Neighbourhood, having received more than 60% of all EIB lending in the region.
The EIB and the Government of Ukraine today 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.
Today in Brussels, the EIB and the European Commission announced the latest set of loans, totalling approximately EUR 600 million, as part of the European Union's commitment to Ukraine made in March 2014.