CFTS-Consulting Performed Market Study for the EBRD 150 mln USD Loan for Gondolas Purchasing by UZ

19 July 2018 17:33

CFTS-Consulting delivered for European Bank of Reconstruction and Development a detailed study of modal competitiveness in Ukraine in terms of cost, administrative and time expenses and prepared a forecast of UZ cargo flow till 2032.

According to the CFTS-Consulting, the results of the study were used by the EBRD to assess the possibility of providing a loan of $150 million to Ukrzaliznytsia for the purchase of gondola cars.

Within the framework of the project, a forecast was made for the development of a freight railway base, a forecast of rental rates for wagons, an assessment of the need for freight cars and an assessment of the prospects for institutional and infrastructural changes.

Andrii Shklyar, the head of the CFTS-Consulting expert department, noted that over the past few years the Ukrainian transport system has undergone a large number of changes caused by both external factors and reforms occurring in the industry. Therefore, the financiers of the European Bank for Reconstruction and Development needed updated information on the situation with cargo transportation in Ukraine.

"After 2014, the structure of the cargo flows in the country has been significantly transformed due to the occupation of the Crimea and the military conflict in the Donbass, which has significantly complicated the predictability of logistics routes and reduced the stability of cargo flows. Under these conditions, UZ carries out significant changes in the market - the approaches to tariff setting are being changed, the car component is being liberalized, railroads position in competition with other modalities is changing. These factors predetermined the need for a more detailed study of the market environment of UZ, after all the EBRD was preparing a loan on commercial terms, without state guarantees", -  A. Shklyar explained.

Just to remind, the EBRD had agreed on a $ 150 million loan project for Ukrzaliznytsia to upgrade its rolling stock. "This loan (together with own UZ funds) will allow us to implement the procurement program for the amount of $ 260 million - this is about 6,500 gondolas, the most used and most worn out in the UZ wagon fleet," said the former deputy finance minister of Ukraine for European integration Artem Shevalev. He stressed that the loan was provided on market terms, without a state guarantee.

"The EBRD Board of Directors agreed on a $ 150 million loan project for Ukrzaliznytsia to update the freight car fleet. Anton Usov, Senior Advisor to the Bank in Eastern Europe, Caucasus and Central Asia, confirmed to us," informed us the Office of the National investment council of Ukraine, adding that the official announcement of the loan will be extended after the signing of an agreement between the EBRD and the UZ.