Kryvyi Rih, Ukraine, December 7, 2021—To support Ukraine's transition to a greener economy and to develop a more sustainable urban transport system, IFC is providing €13.7 million in financing to the city of Kryvyi Rih, the country's largest industrial hub. The aim is to help upgrade its public transport system and improve energy efficiency, part of IFC's broader efforts to boost climate investment and economic growth in Ukraine.
Kryvyi Rih is heavily dependent on its tramway network, a key mode of public transport for the city with a population of nearly 630,000. However, a significant number of the tramcars have been operational for more than 30 years—far longer than their useful life. To renew and expand the system, the municipality is working on purchasing new cars and upgrading existing ones. It is also developing an urban transportation master plan to promote alternative modes of transport and help improve the environment.
IFC's investment, comprising €10.2 million of its own account and €3.5 million in blended concessional finance through the Climate Investment Funds' Clean Technology Fund, will help the city achieve its goals, complementing scarce public sector resources.
"We are committed to implementing a comprehensive transport modernization program," said Yuri Vilkul, Kryvyi Rih's Acting Mayor. "Our new partnership with IFC is critical for this, because electric transport is the city's most popular mode of transport. We have already done the necessary preparation for the project, including developing a preliminary procurement plan and introducing free municipal transport for residents. We look forward to implementing our joint project."
IFC's loan will allow Kryvyi Rih to purchase 15 electric tramcars, which will enable significant electricity savings through regenerated energy, while also reducing the need for frequent repair and optimizing travel time. The new rolling stock will comply with international safety and accessibility standards, boosting safety and comfort. The funding will also help rehabilitate about a kilometer of critical tramway line, which is vital for the east-west transport artery in the city center.
"Developing sustainable, greener urban infrastructure will help Ukraine achieve its climate commitments while reducing electricity consumption and improving the quality of life for the nation's urban residents. Our overarching goal is to help introduce climate-smart infrastructure in Ukraine's fast-growing urban centers by boosting private sector participation," said Jason Pellmar, IFC Regional Manager for Ukraine, Belarus, and Moldova.
IFC previously worked with Kryvyi Rih through the IFC's Cities initiative, implemented in partnership with the Swiss State Secretariat for Economic Affairs SECO and the Federal Ministry of Finance of Austria, which helped address environmental and social risks. It also supported the city in obtaining an international credit rating, improving its ability to attract long-term financing.
To progress further, IFC will advise the city on how to improve the operational and financial sustainability of its tram company, while increasing transportation efficiency and optimizing route network among other operational reforms.
IFC also forged strategic partnerships with the cities of Mariupol and Zaporizhzhia as part of the Cities initiative, helping authorities switch to greener urban transport alternatives and improve the quality of communal services in Ukraine.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.
About Climate Investment Funds
The Climate Investment Funds (CIF) are unique financing instruments designed to initiate transformational change towards low-carbon and climate-resilient development through scaled-up financing channeled through the multilateral development banks, including IFC. CIF funding for this project is provided through the Clean Technology Fund (CTF). CTF provides developing countries with positive incentives to scale up the demonstration, deployment, and transfer of low carbon technologies with significant potential for long-term greenhouse gas emissions savings. For more information, visit www.climateinvestmentfunds.org
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