The Ministry of Infrastructure announced that the Soufflet Group, a leading player in global grain markets, will develop the SE Illichivsk Sea Commercial Port. An MOU was signed that outlined Soufflet’s intention to implement the infrastructure development project over the next few years. P3DP is supporting efforts to develop industrial parks and related infrastructure.
P3DP participated in the Q&A session organized by the EBA with Ukraine’s Minister of Infrastructure. The Minister stressed the importance of rehabilitating key ports and improving commercial access to the system of waterways. Restructuring of the State Road Agency was also cited as a priority step toward improving infrastructure needed for economic development.
“There is a direct correlation between investing in infrastructure and improving the economy, including the nation’s employment rate,” says Mike Beland from the University of Maryland in an article in the Baltimore Sun. Ukrainians will relate to his concerns. Bridges and roads are in urgent need of repair, but the public is not willing to spend the necessary money. In the meantime, unemployment is high.
Private sector spending accounts for only six percent of investment in infrastructure in the United States. Beland believes that the answer is to increase private investment through public-private partnerships: “Encouraging private-sector investment in our infrastructure in a transparent, secure manner is essential both to improving the roads and keeping businesses here. A consequence of poorer infrastructure is that it encourages employers to locate their businesses elsewhere — in a different city, state or country,” he says.
The same principle holds true in Ukraine. Read the full article here: “Ailing U.S. infrastructure needs public-private investment.”
One of the benefits of PPPs is their transparency, which reduces corruption and builds public trust. But not every PPP is implemented smoothly. Landlinemag.com reports that a 50-year, $425 millon PPP to improve a highway in the U.S. state of Colorado ran into trouble because the deal was “done secretely with little public input.
Policymakers in Colorado have responded by proposing legislation that would require public discussion of future PPPs.
Transparency in highway projects is also an important issue in Ukraine. The National Projects Agency of Ukraine held a public presentation of a proposed Ring Road feasibility study in November 2012 and invited the press to the signing of a cooperation agreement with the International Finance Corporation last October.
By being transparent about the project as it develops, the National Projects Agency ensures that all affected stakeholders raise concerns early in the process. P3DP integrates strategic communications and public discussions in all its pilot PPP projects in Ukraine.
Read the full article in Landlinemag.com.
P3DP’s knowledge and experience of the PPP process in Ukraine has been recognized by the National Projects Agency (NPA) and the International Finance Corporation (IFC), the private sector arm of the World Bank Group. The NPA asked P3DP to help identify regulatory obstacles to the Kyiv Ring Road Project and to propose changes in legislation to address them. P3DP will also join a working group along with IFC, NPA, and Ukravtodor, the state governing body of roads in Ukraine.
Last month, IFC began a feasibility study for a road concession project to connect Kyiv’s ring road to a major highway, which will require building either a tunnel or a bridge. The project will improve the flow of commercial traffic around the city, which intersects with several major transportation corridors in Central and Eastern Europe. The feasibility study will be submitted to the Cabinet of Ministers of Ukraine by the end of first quarter of 2014.
Legislation that P3DP will examine includes the public procurement law, the road concession law, and the PPP law, among others. It will review how legislation impacts the process for selecting a concessionaire, public spending, contracting issues, permits, land rights, construction and other issues. P3DP’s Tatiana Korotka has drafted a terms of reference for this analytical work for review and comment.
P3DP’s involvement enables it to have valuable input to an important infrastructure project that will have a major economic and environmental impact in Ukraine. Its expertise, gained through previous legislative work and on pilot PPP projects, will now have a broader impact.