A pilot project looking to attract private investment into transport infrastructure in Russia, launched in London this week, will herald a series of transport projects in the Federation worth tens of billions of dollars, so its success is crucial to future investment.
The Russian Federation and the City of St-Petersburg held a conference for some 135 potential investors, lenders and their advisers on the Western High Speed Diameter (WHSD) toll road project for St-Petersburg on December 11th & 12th.
The European Bank of Reconstruction and Development (EBRD) hosted the conference. EBRD President Jean Lemierre opened proceedings with an assessment of the importance of Russia as a growing market and of EBRD’s support for this project. The International Finance Corporation and the European Investment Bank, also present, have provided letters of intent expressing their interest in providing financing for the project, with the Nordic Investment Bank informally indicating a similar interest.
Delegations from the Russian Federation and the City of St Petersburg included such senior figures as Deputy Minister of Economy Androsov, Minister of Transport Misharin, Vice Governor of St Petersburg Molchanov, and Mr. Belozerov, Head of the Federal Highways Agency.
Mr. Belozerov said: ‘There is a considerable pipeline of transport investment projects - particularly roads – forthcoming in Russia. The WHSD for St-Petersburg is the first such project, so it is particularly important and must, from the Government point of view, succeed.’
Deputy Minster Androsov described the dynamic growth of the Russian economy and the Government’s commitment to private investment in infrastructure, and in particular to this project as key to the success of all future private investment projects in transport. Deputy Minister of Transport Misharin followed with an assessment of the future of transport in Russia. He said that WHSD was a pilot project, representing Russia’s return to attracting private investment into transport infrastructure after a 100 year hiatus.
Vice-Governor of St-Petersburg Molchanov finished the conference with a description of the financial, social and political importance of St-Petersburg and the importance of the WHSD project to its continued growth and success. Presentations were also given by the Government’s project management company (“Western High Speed Diameter” JSC), financial advisers (the World Bank), legal advisers (Freshfields) and technical advisers (the Research and Design Institute of Regional Development and Transportation for St-Petersburg), who reported on the robust financial, legal and technical design of the project.
That said, the Grantor is still considering key risk allocation issues. An important aspect of the investor conference was to get feedback from the market on project design. Bilateral meetings were then held at the EBRD on Monday afternoon and Tuesday with groups of interested investors.
A report of all questions and answers from the London conference, though unattributed, will be made available on the project web-site www.whsd.ru which also provides general information on the project, including the full Preliminary Information Memorandum.
News source: www.infrasite.nl
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