Ukraine to use over EUR 50 mln from German loan to rebuild Donbas
Ukraine's Infrastructure Ministry will use over EUR 50 million out of a EUR 500 million loan extended by the German government, to rebuild Donbas transport infrastructure damaged during hostilities, the ministry's press service reported.
This agreement was reached on October 2 at a meeting in the Infrastructure Ministry, which was attended by Deputy Infrastructure Minister Mykola Snitko and representatives of Germany's Federal Ministry of Transport and Digital Infrastructure and the German Embassy in Ukraine.
"The provision of the loan by the German government to restore infrastructure in Donbas is foreseen in an intergovernmental memorandum of understanding. The Infrastructure Ministry plans to purchase two mobile railway substations for the restoration of railway infrastructure in Ukrainian-controlled territories in the country's eastern regions. Repaired railways will allow us to pull back locomotives from the region and bring freight from there, namely coal needed for Ukrainian power plants' preparations for winter," the report reads.
It is also reported that the Ukrainian side proposed channeling some funds into the repairs and modernization of 2TE116 diesel locomotives to be used for transportation of freight from the temporarily occupied Donbas.
In addition, the negotiating parties also agreed that Ukraine would provide the German side with detailed estimates of repair costs. It was also agreed that both sides would monitor the use of the funds.
As reported, in April 2015 the governments of Germany and Ukraine signed the Memorandum on Common Intentions regarding the untied loan guarantees in the amount of EUR 500 million to be spent on the rehabilitation and modernization of Donbas infrastructure. It includes new construction, reconstruction, renovation and modernization of infrastructure facilities in any form of ownership.
As UNIAN reported earlier, on January 7, the Government of Ukraine and the Federal Government of Germany signed a joint statement on provision of the untied loan guarantees of the Reconstruction Credit Institute (KfW) in the amount of EUR 500 million. According to Ukrainian Prime Minister Arseniy Yatsenyuk, the loan funds are provided for the period of up to 20 years at a very low interest rate and will be allocated, inter alia, for investment in the reconstruction of eastern Ukraine.
Due to continuous fighting in the east of the country, Ukrzaliznytsia (State Rail Transport Administration) reported 842 cases of interference by unauthorized persons in the operation of the railways in 2014, which is 3.2 times more than in 2013.
The State Agency of Automobile Roads of Ukraine estimated its losses due to the destruction of roads during hostilities in Donbas at UAH 4.7 billion as of February 2015.