By Anton Usov
The first-ever concession project in Ukraine, structured in line with best international practice, was signed today. The consortium of RISOIL, Ukraine’s leading stevedoring and agro-industrial company, and the Georgian Industrial Group, the largest industrial holding in Georgia, was awarded a 30-year concession for the seaport of Kherson following an open international tender.
A precondition for this agreement was the introduction of a concession law in Ukraine in 2019 that regulates the concessional use of state and communal property and increases its efficiency, as the legal framework for the project.
The European Bank for Reconstruction and Development (EBRD) provided technical assistance for the preparation of this law. Together with the government of Ukraine and the International Finance Corporation (IFC), the Bank helped organise the concessional tender and brought the project to a commercial close, making it the first ever public-private partnership in Ukraine.
The concessionaire will be responsible for the operation and modernisation of the seaport over the 30-year period and will invest around US$ 15million in port facilities and supporting infrastructure by 2030. It will have to increase the volume of cargo transhipment, up to 80 per cent of which must be delivered by rail or water transport modes to improve the environment in the city of Kherson, an important port on the Black Sea in southern Ukraine.
RISOIL will also be aiming to introduce modern logistics and transport solutions for the seaport to limit the volume of cargo transport by road and relieve congestion for the city. The Kherson concession project highlights new investment opportunities in Ukraine’s transport sector and puts the country on the global map for international transhipment and stevedoring companies. It will also serve as a model for future concessions across different sectors of the national economy.
The EBRD is the largest international financial investor in Ukraine. To date, the Bank has made a cumulative commitment of almost €15 billion(US$16.83billion) through 466 projects in the country.