TAIEX SEE Regional Road Transport Infrastructure Safety & Funding Financing transport infrastructure with the EBRD

Transcription

1 TAIEX SEE Regional Road Transport Infrastructure Safety & Funding Financing transport infrastructure with the EBRD Ulf Hindström Belgrade 17 November 2005

2 EBRD Transport Team: Who are we? EBRD has a team specially dedicated to transport 25 Professional & 6 Support Staff Mix of private sector, public sector and procurement specialists Working in close co-operation in the Resident Offices (including in Belgrade, Bucharest, Pristina, Sarajevo, Skopje, Sofia, Tirana and Zagreb)

3 EBRD Transport Team: What do we do? Product range covers entire spectrum from sovereign leading to private equity: Sovereign/sovereign guaranteed loans Corporate lending Concession financing Asset backed lending Equity Private sector financing structures increasingly adopted by public sector clients

4 EBRD Transport portfolio Invested over Euro 3.5 billion in 120 projects with a total value of over Euro 11 billion Central Europe 43 projects 34% Russia 16 projects 18% Central Asia 12 projects 10% SEEC 49 projects 38% At End August 2005

5 Annual Business Volume: 2006 Pipeline Strong project pipeline (non-discounted) - ABV 700mn - 22 Projects Diverse spread by region, producttype,sector Corporate lending 7% Region (by Volume) Concession financing 5% Central Asia 10% Central Europe 11% Product (by Volume) Asset-backed 26% Sovereign 62% Shipping 15% Ports 9% Sector (by Volume) Rail 30% Russia 24% SEEC 55% Aviation 23% Road 23%

6 Sovereign Lending as a Tool for Achieving Transition 3.3billion sovereign lending has been instrumental in facilitating sector-wide reform for all transport modes in EBRD countries of operation 78% of transport s public portfolio carries at least good transition impact rating, with 15% rated as excellent Bankers required to undertake and facilitate extensive policy dialogue with governments and state agencies In-depth sector knowledge needed to agree transition milestones and supervise implementation

7 Transport Team: Reform Achieved in the Railway Sector Preparation of blueprint for reform/regulatory separation: Russian Railways; Uzbek Railways; Azeri Railways, Kazakhstan Corporatisation of railway companies: Georgian Railways; Ukrainian Railways Separation of infrastructure from operations/eu Directives: Poland, Romania, Serbia, Bosnia and Herzegovina, Kazakhstan.

8 Transport Team: Reform Achieved in the Road Sector Enhanced cost recovery for the sector from user charges: Russia, Croatia, Macedonia, Azerbaijan, Kazakhstan, Ukraine Introduction of competition for road maintenance: Bosnia and Herzegovina, Croatia, Azerbaijan, Macedonia Creation of Road Advisory Boards: Romania, Azerbaijan, Croatia

9 Transport Team: Reform Achieved in the Airports/ANS & Port Sectors Separation of airport and air navigation functions: Estonia, Croatia, Ukraine, Georgia Introduction of passenger and user charges: Armenia, Georgia, Ukraine, Croatia, Serbia & Montenegro, Macedonia, Tajikistan Separation of infrastructure from port operations: Kazakhstan, Turkmenistan, Georgia, Romania

10 Transport Team: From Chrysalis to Butterfly Sovereign lending as launch pad for commercial financing structures Polish Railways 1996 E-20 Railway Project: sovereign guaranteed 2000 Labour Restructuring: innovative product, sovereign guaranteed 2002 Financial Restructuring: first of its kind in sector, sovereign 2004 PKP Energetyka: first non-sovereign railway lending 2006 In pipeline: privatisation of PKP Cargo

11 Transport Team: From Chrysalis to Butterfly Tallinn Airport 1999 Airport Rehabilitation Project / Sovereign guaranteed 2002 Corporate Loan to the Airport Company Hungary Roads 1992 Hungary Budapest Orbital / Sovereign Guaranteed 2004 Hungary M5 Second Phase / PPP 2005 Hungary M6 / PPP

12 Transport Team: Public-Private Private Partnerships Public-Private Partnership (PPP)-a long term contract for the private sector to provide services to, for, or on behalf of government. Payment in respect of PPPs may flow in either (and sometimes both) directions between the concessionaire and the government

13 Transport Team: Public-Private Private Partnerships Track record: transport PPPs financed by the Bank to date: Country Project Name Date signed EBRD finance m Total Finance m Hungary M1-M15 Motorway 23/12/ Hungary M5 Motorway 11/12/ Hungary M5 Motorway refinancing 10/03/ Hungary M5 Phase II financing 21/09/ Hungary M6 Motorway 18/07/ Albania Czech Republic Tirana Mother Teresa Airport Redevelopment of 3 mainline stations (equity) 23/03/ /12/

14 What s so special about EBRD s Transport PPPs? M1- M15 Motorway M1-M15 tolled motorway-true demonstration of risk taking by private sector-equity was lost; the concessionaire was replaced with a state owned concession company; lenders took a 10% haircut

15 What s so special about EBRD s Transport PPPs? M5 Motorway Low traffic volumes: Bank s timely refinancing puts concessionaire on sound financial footing Government wants rapid abolition of tolls to bring motorway into vignette system; Bank provides interim finance to avoid nationalisation and allow negotiation of availability payments based concession agreement Bank participates in renegotiation of concession to ensure bankable document. Well received at Board. Bank requested by investors to act as underwriter for refinancing as construction nears completion

16 What s so special about EBRD s Transport PPPs? M6 Motorway First PPP tendered as an availability payments concession in Bank s countries of operation Because of competitive tender, sponsors brought in EBRD after award of the concession Sponsors recognise value added of Bank s presence at an intermediate level before general syndication

17 What s so special about EBRD s Transport PPPs? Albania: Mother Teresa International Airport, Tirana EBRD support to Government & advisers at an early stage; tender successful & compliant with Bank s standards EBRD combined state guaranteed & private funding for construction of access road in addition to funding for rehabilitation of airport terminal Much interest raised by well-structured project, American Albanian Bank, Alpha Bank & DEG are participating Excellent example of a complex project properly run in an ETC, with strong demonstration effect

18 What s so special about EBRD s Transport PPPs? Grandi Stazioni Bank s first equity investment in a transport PPP. Bank relies on dividend income not equity exit Project involves rehabilitation & commercial exploitation of Prague Main, Marianske Lazne & Karlovy Vary stations Czech national railways tendered 30-year concession in line with the Bank s requirements Local commercial banks provide the long-term debt financing

19 EBRD s impact in PPPs EBRD s involvement in PPPs has achieved the Bank s transition and additionality objectives and more recently has given rise to high quality portfolio assets Even the instances where EBRD rejects PPP projects, such as the Bucharest-Brasov road in Romania, send clear messages to the countries of operation and the market that these large and complex projects will not find finance if ill-prepared

20 Prospects for the future PPP Projects Bulgaria: Bourgas & Varna Airports Slovakia: D1 East-West Road Slovakia: Electronic tolling of Heavy Goods Vehicles Czech Republic: D3 Highway Poland: A1 motorway N-S extension Romania: Bucharest-South relief road and others Romania: Concessions for various airports Serbia: Horgos to Pozega Upgrade Russia: Moscow-St Petersburg Highway Latvia: Riga-Jelgava Highway and others Hungary: M6 Motorway section II

21 Contacts Riccardo Puliti Director, Transport Team Tel: pulitir@ebrd.com Ulf Hindstrom Senior Banker, Tel: HindstrU@beg.ebrd.com Robin Earle Senior Banker, Transport Team Tel: earler@ebrd.com