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Lithuania gears up for major road works funded partly by the EBRD
As part of an internationally funded programme to promote Lithuania's links with its neighbours and Western Europe, and to develop the national road network, the European Bank for Reconstruction and Development (EBRD) is providing a US$ 23.2 million (ECU 18.6 million) loan, guaranteed by the Republic of Lithuania.
"Over recent years the lack of investment in maintenance and construction has meant that vital road links within the country are no longer able to cope with the growth in road traffic that has come with economic revival," commented Ron Freeman, First Vice President of the EBRD. "The EBRD's loan, along with funds provided by other co-financiers, will create an improved road transport infrastructure as well as create job opportunities in the road-side service and construction sectors."
Two main arteries require urgent upgrading: (a) the Via Baltica international highway, which links Lithuania and the other Baltic states with the rest of Europe, and (b) the East-West highway, which runs from the Belarus border via Vilnius and the main industrial city of Kaunas to the Baltic Sea port of Klaipeda.
Proceeds from the EBRD loan, which has a 15-year term including a four-year grace period, will finance three components on the Via Baltica: construction of a bypass at Kedainiai and a new road section from Kedainiai to Kaunas; completion of a bypass at Panevezys; and reconstruction of a section from the Latvian border to the village of Riaubonys. It will also finance three components elsewhere in Lithuania: five small bypasses; reconstruction of the East-West highway; and street improvements in Kaunas.
The total project cost is US$ 117.1 million, 74 per cent of which is the foreign exchange segment, co-financed with the Export-Import Bank of Japan, the World Bank, the European Investment Bank, the Nordic Investment Bank and subsidised by EU-PHARE.
The planned improvements in the Via Baltica development programme will bring about significant reductions in border-crossing delays, reducing waiting times for all road transport. The project will also lead to better road-side services, allowing the country to develop regional links and improve European integration.
An environmental impact assessment (EIA) was carried out on the project in conformity with Lithuanian regulations and the EBRD's Environmental Procedures. The EIA resulted in the preparation of a plan to mitigate potential environmental problems, including works such as animal underpasses, noise-reduction fencing and sedimentation tanks to address the issues of road pollution.
To date, the EBRD has committed ECU 180 million to projects in Lithuania, of which this is the second in the transport sector.
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