World Bank Approves Initial $50 Million Grant to Help Repair Transport Infrastructure in Ukraine

The World Bank announced today a new $50 million project to repair and restore Ukraine’s transport network to support immediate humanitarian relief and recovery, and increase capacity of import and export corridors. The grant financing for this project is provided by the Ukraine Relief, Recovery, Reconstruction and Reform Trust Fund (URTF), with additional funding of up to $535 million envisaged to follow shortly. This is the second scalable World Bank supported emergency operation approved within two months that mobilizes partner resources through an innovative framework approach.  The first one was approved in December and focuses on repairing health infrastructure and health services.

The Repairing Essential Logistics Infrastructure and Network Connectivity (RELINC) Project will help to restore essential bridges and railways to relink communities and improve westward transport linkages to mitigate impacts of Black Sea shipping disruptions. Specifically, the project will support the purchase of modular bridges, equipment, and materials to urgently repair damaged road-to-bridge connections and vital rail lines. It will also help to finance the purchase of flatbed wagons and additional rolling stock to expand the railway’s capacity to move cargo in containers.

“Russia’s invasion of Ukraine continues to have devastating economic and humanitarian consequences,” said World Bank Vice President for Europe and Central Asia Anna Bjerde. “Ukraine needs urgent investments to repair damaged essential transport routes. This project will support delivery of aid and essential services to communities directly affected by the war and will boost the economy in Ukraine and beyond by facilitating transport and trade. We are grateful to our donors and partners for their continued support, generosity, and collaboration.”

According to World Bank estimates, upwards of 2,100 villages, 51 towns, and 35 cities in areas that have returned to Government of Ukraine control are experiencing disrupted transport networks due to war. Direct damage to Ukraine’s transport network is extensive totaling more than $29.9 billion and economic losses from disrupted transport total an additional $26.1 billion as of June 1, 2022.

This investment supports and is part of the World Bank’s contribution to the EU-Ukraine Solidarity Lanes initiative. The project will better align Ukraine’s rail lines to EU logistics chains and support agricultural exports through EU ports, thereby strengthening westward linkages that will bolster Ukraine’s economy and restore services to its population.  It will also help to lay the groundwork for the country to build a more modern, low-carbon, climate-resilient, and inclusive economy that is more closely aligned with European standards.

The project has a flexible design that allows funds to be disbursed quickly, can be scaled as necessary, and can absorb additional financing as it becomes available.

The Ukraine Relief, Recovery, Reconstruction and Reform Trust Fund (URTF)was set up by the World Bank to coordinate grant financing for sustaining Ukraine’s government functions, delivering services, and implementing relief efforts. The URTF is a flexible platform that allows the World Bank to prioritize and channel funding to the most urgent development needs identified by the Ukrainian government, with current contributions from Austria, Iceland, Lithuania, the Netherlands, Norway, Sweden and Switzerland.

This project adds to several substantial financing packages announced last year to sustain core public and health services in Ukraine. To date, the World Bank has mobilized more than $18 billion in emergency financing for Ukraine, including commitments and pledges from donors. More than $16 billion of this financing has been disbursed through projects, including Public Expenditures for Administrative Capacity Endurance (PEACE) Project.

Source : World bank