The European Bank for Reconstruction and Development (EBRD) and PJSC Ukrzaliznytsia have signed a long-term loan agreement on the issue by the bank of $150 million for the purchase of new freight high-sided cars.
“An investment program by Ukrzaliznytsia is to receive a major boost in the form of a $150 million senior loan from the EBRD. The loan will be used to acquire up to 6,500 general purpose open freight gondola-type wagons through an open international tender,” a press release of the bank reads.
“The investment program will help maintain Ukrzaliznytsia’s capacity, significantly improve its efficiency and reduce greenhouse gas emissions produced by its operations. Carbon dioxide emissions are expected to fall by up to 80,000 tonnes a year thanks to the new rolling stock,” it says.
“The financing will be combined with corporate governance reforms at Ukrzaliznytsia and its subsidiaries. The development and implementation of a corporate governance action plan and an anti-corruption action plan will introduce measures such as the appointment of independent directors, business planning, the establishment of an audit committee, an internal audit function and anti-corruption measures, making it a benchmark for other state-owned enterprises in Ukraine,” according to the document.
“The EBRD will also assist Ukrzaliznytsia in certifying and improving its procurement processes and implementing an energy management information system, which will lead to better overall efficiency of Ukrzaliznytsia. This will be funded by the EBRD Shareholder Special Fund,” the report states.
“Upgrading and modernizing Ukraine’s freight railway fleet is a major contributor to strengthening the country’s regional and international integration. Ukrzaliznytsia possesses a total track length of over 23,000 km, making it the 14th largest in the world. It is the world’s sixth largest rail passenger transporter and the world’s seventh largest freight transporter. The EBRD has supported the transformation of the state-owned enterprise into a commercially-run corporate,” the EBRD said.
