Concession roads will appear in Ukraine only after creation of a road fund and adoption of a concession law. Minister of Infrastructure Volodymyr Omelian announced this at a news briefing, the CFTS correspondent reports.
"The conditions for appearance of concession roads are as follows: creation of a road fund and adoption of a concession law. Only after that will we proceed to the next stage, which will be negotiations with potential investors who are willing to invest in roads in Ukraine and operate in the concession format," Omelian said.
The minister also said that an important condition for concession roads is traffic, which the government should provide or create a compensation mechanism in the event of absence of traffic. "We must not forget that concession is not a charity business. An investor that invests money expects a return on his investment in the long run. Until we have enough traffic or guarantee or compensation for this traffic by the state, there will be no fully fledged concession roads in Ukraine," the minister said.
According to Omelian, the first concession road project could be the construction of Great Ring Road around Kyiv. "Theoretically, we are ready begin the first round of negotiations on construction of the Great Ring Road around Kyiv. This project has been under discussion for a long time. Possibly, 2017 will be a turning point, and this is the number one project that are currently considering," the minister said.
As previously reported, an interdepartmental commission rejected applications from companies to participate in the first Ukrainian concession project, which involved construction and operation of a new Lviv-Krakovets highway, in September 2015. A consortium called Concession Highways (Ukraine) and the Bouygues company (France) submitted documents for the competition.