Over the past 2 years, thanks to the creation of the State Road Fund, 35% of which goes to the restoration of the local road network, it has been possible to restore more local roads than were restored in the previous 8 years
Such data was provided by the Deputy Minister of Infrastructure of Ukraine for European Integration, Natalia Forsyuk, during the online conference “Prospects for the Development of Road Infrastructure in Ukraine.”
According to her, if during 2010-2017 in Ukraine every year 0.5-17 km of local roads were repaired in each region, starting from 2018 this average indicator is 40-45 km, and in 2020 according to the plan it is planned to increase it almost twice – to 77 km.
However, despite the rhythmic growth of the volume of work, the amount of financing of territorial road funds is still insufficient for the restoration of the entire length of the local road network and the implementation of large-scale infrastructure development projects in the regions.
“This issue can be partially resolved through additional financial resources, including low-interest loans from international financial organizations,” Forsyuk emphasized, adding that Ukraine’s permanent partners – the European Bank for Reconstruction and Development, as well as the European Investment Bank, which have long been implementing infrastructure projects on public roads of national importance, have already expressed their readiness to provide financing to regional state administrations to restore and improve the network of local roads.
According to her, the current legislation provides for the possibility of attracting local external borrowing to carry out repair and construction work on public roads of local importance and municipal property, however, the possibility of directing funds from territorial road funds is strictly limited – exclusively to servicing local debt and in the amount of no more than 10%.
“The unpredictability of filling local budgets, at the expense of which local governments must repay external debt, as well as restrictions on the use of subvention funds from the State Budget, slow down the process,” the Deputy Minister emphasized.
To address this issue, the Ministry of Infrastructure of Ukraine has already developed relevant amendments to the Budget Code of Ukraine and the Law of Ukraine “On Sources of Financing of the Road Sector of Ukraine”.
According to the changes, local authorities will be able to direct funds from territorial road funds to repay not only local debt servicing costs, but also the loan amount raised for repair and construction work on local public roads, streets and roads of municipal property in the amount of up to 50% of the amount of the subvention received.
“In this way, local governments will be able to guarantee to International Financial Organizations timely and full repayment of payments on local external borrowings and at the same time modernize the infrastructure of their region in accordance with European standards,” she concluded.
