Peculiarities of financing investment infrastructure projects in Ukraine

The purpose of the article is to show the role of international financial organizations in financing the development of the transportation network of Ukraine. It is shown the necessity of implementation of infrastructure projects for the development of the state economy and increase of its competitiveness. The structure of sources of financing in the development of highways is shown and the gradual reduction of the share of investments at the expense of the State budget and the insignificant role of public and private partnership in the transport sphere are revealed. The cooperation of Ukraine with international financial organizations: the International Bank of Reconstruction and Development, the European Bank of Reconstruction and Development, and the European Investment Bank in the implementation of infrastructure projects have been studied. A retrospective analysis of the available loan agreements was performed. The expected positive consequences of international investment for the transport sector of Ukraine and the economy as a whole have been identified. Information is given on real investment infrastructure projects with the participation of international financial institutions and the financial conditions of their implementation. The shifts in the arrangement of highways of Ukraine at the expense of international investments are listed.


Introduction
To overcome the difficult economic situation, Ukraine needs to modernize the road network, which can be done through the implementation of investment infrastructure projects. Given the unsatisfactory financial condition of the transport sector in the short term, attracting investment funds will help stabilize the road sector by providing the necessary funds for road maintenance. In the medium and long term -economic growth and competitiveness, by strengthening ties between regions and improving transit corridors [1]. Modernization of the road network will enhance economic activity by reducing travel times and reducing transportation costs between major centers in Ukraine and their regional trading partners.
At the same time, improved road infrastructure will increase productive investment in the territorial communities that benefit from investment infrastructure projects and create jobs for their residents, which in turn will increase household incomes and consumption levels, as well as reduce poverty. It should also be borne in mind that the development of transport requires not only the construction of roads but also involves solving problems such as reducing road congestion, environmental protection, traffic safety, etc. [1].

Analysis of recent approaches and publications
The resumption of Ukraine's economy and growth of its competitiveness largely depends on the efficiency of the transport system. This relationship has been studied by scientists from different countries and using different approaches [2]. India's experience has shown that there are long-term interrelations between transport infrastructure and economic development, where economic development being the main factor in most cases [3]. The paper [4]describes the concept of transport infrastructure in Latvia as an important part of the state transport system. The impact of infrastructure development on the economic progress of India and China also confirms the importance of building a transport system, including the use of foreign investment [5] . In general, it is introduced the impact of road development on economic growth in the new EU member states [6].

Results
In order to restore and develop public roads of national importance for their integration into the European transport system and increase the level of traffic safety, speed, comfort, and efficiency of transportation, the Cabinet of Ministers of Ukraine in 2013 developed and approved the State Targeted Economic Program for Public Roads use for 2013-2018.
It is state support and its quality that determine the development of the transport industry [7]. This program was not implemented in full due to underfunding in 2015-2016. Targeted funding sources were canceled, and the planned expenditures for road development in the general fund of the state budget were usually underfunded by the Treasury. As a result, in 2015-2016, the construction of highways was actually stopped, the volume of work on the current average repair was ten times lower than the norm, the pothole was eliminated late and not on all roads. In 2016-2017, due to increased funding, repair and construction work on public roads were significantly intensified, but the lists of facilities were formed not on the basis of this Program, but by separate orders of the Cabinet of Ministers of Ukraine. This unstable state of transport financing was caused by political instability in Ukraine. It should be noted that political and institutional interference in economic processes must be balanced and justified. Attracting foreign, regional, or private investments in the implementation of infrastructure projects depends on government strategies [8,9].
The projected amount of funding for the State Targeted Economic Program for the Development of Public Roads of State Importance for 2018-2022 is UAH 372.3 billion, of which 67.5% should be financed from the State Budget.
During the implementation of the program, the amount of funding increases significantly over the years from 30.0 billion in 2018 to 97.5% in 2022 (Table 1).
It should be noted that significant changes in funding sources during the implementation of this program. If in 2018, the amount of funding from the State budget in 2018 is 87.6%, and for other sources, including investors' funds account for 12.4%, then in 2022 -48.9% and 47.3%, respectively. At the same time, it is not typical for Ukraine to attract private investors, although public-private partnerships for individual investment projects are the most rational [10]. Financing schemes for infrastructure projects implemented with the participation of international financial institutions are receiving increasing attention around the world. At the same time, there is a defined range of issues that the government must address in order to obtain the necessary investment [11]. For many years, Ukraine has been actively and effectively cooperating with international financial organizations: the International Bank for Reconstruction and Development (IBRD), the European Bank for Reconstruction and Development (EBRD), and the European Investment Bank (EIB). Their activities, among other things, aim to assist in the implementation of investment infrastructure projects (overhaul, reconstruction, and construction of roads, institutional development), which is carried out through long-term lending and consulting services the implementation of projects.
Implementation of investment infrastructure projects, with the participation of the IBRD, EBRD, and EIB, will cause the following economic effect: -reducing the number of accidents related to unsatisfactory road conditions; -reduction of the negative impact of the road transport complex on the environment; -strengthening of roadsides will allow to eliminate dust formation, will improve drainage from the carriageway and from the road, will reduce erosion of soils and pollution of open reservoirs and ground waters; -reduction of annual operating costs of road transport, taking into account the loss of passengers as a result of travel, -reduction of annual investment in road transport; -reduction of annual unproductive loss of working time of passengers on the road; -reduction of consumption of motor fuels, The reduction of annual costs for current repairs of highways resulted from the improvement of transport and operational condition, which can be directed to current repairs and maintenance of other highways [12][13][14]. According to the cooperation with international financial organizations, in 2018 works and services were financed in the amount of UAH 3.7 billion, in 2019 -UAH 4.3 billion. Institutional development includes the provision of consulting services, training, and supply of equipment to strengthen the traffic management system and improve the maintenance of roads following an international practice. The purpose of the implementation projects of investment infrastructure projects with the participation of the IBRD is the rehabilitation of the international highway M-03 (Kyiv -Kharkiv -Dovzhanskyi checkpoint), improving road safety (elimination of places of concentration of accidents) and institutional development. With the participation of the EBRD, the M-06 (Kyiv-Chop) highway is being restored and the financing of the road sector is being reformed. With the joint participation of the EBRD and the EIB, the reconstruction of the last section of the M06 road, the improvement of Ukraine's road infrastructure, and the promotion of further reform in Ukraine's road sector (Table 2). Road of international importance on the territory of Ukraine, which passes through the territory of Kyiv, Zhytomyr, Rivne, Lviv and Zakarpattia regions and is part of the European transport corridors №3 and №5 The first loan agreement was concluded in December 2000 with the EBRD. Currently, 9 credit agreements have been concluded between Ukraine and international financial organizations, including 4 credit agreements with the EBRD (total value of EUR 825.0 million), 2 credit agreements with the EIB (total value of EUR 750.0 million), and 3 loan agreements with the IBRD (total value of $ 1,187.0 million). Information on the implementation of investment infrastructure projects with the participation of international financial institutions and the relevant financial conditions is provided below (Table 3, Table  4, Table 5, Table 6). The beneficiary of the agreements is the Ministry of Finance of Ukraine or the State Agency of Motor Roads of Ukraine. The source of repayment is the state budget.  -the strengthening of the existing pavement by the technology of cold recycling was carried out. For the device of the top layer of a covering the crushed stone-mastic asphalt concrete made with the use of modern additives that will allow overcoming problems of a track in the summer period is used. Additional strengthening of asphalt concrete layers on lanes of heavy transport is provided by a special reinforcing grid; -to improve winter maintenance and increase road safety, 6 road meteorological stations were installed, 53 man-made structures were built, of which: 32 man-made pedestrian crossings at different levels and 21 bridges, overpasses, and cattle runs;bringing the M-03 to the highway standard, which was a direct contribution to a significant reduction in the number of accidents in the area between Boryspil and Lubny from 248 per year before the project to 10 per year of project closure. It is planned to achieve: -Rehabilitation and improvement of traffic safety in selected sections of M-03, -building institutional capacity to facilitate the implementation of reforms in the field of maintenance.
-implementation of road safety and network management system. Main achievements in the implementation of investment infrastructure projects with the participation of the EBRD and the EIB: It is planned to achieve: -overhaul of roads with a total length of 142 km with bringing 22 km to the I technical category.
-repair of artificial structures (17) and construction of new artificial structures (45). Implementation of investment infrastructure projects should be subordinated to the task of structural restructuring of the transport sector, aimed at ensuring balanced and harmonious development of all parts of the complex, to renew the production capacity, increase the efficiency of its use. For the further development of the transport industry, it is necessary to concentrate investments on the introduction of high-performance and the latest innovations and information technologies, renewal, and modernization of fixed assets and infrastructure.

Conclusions
Ensuring a favorable investment climate remains a matter of strategic importance, the implementation of which depends on the effectiveness of economic growth measures in Ukraine, the effectiveness of investment projects, the possibility of modernization of the transport sector. The formation of a favorable investment climate should take place both at the macro and regional levels, optimizing the whole set of political, legal, economic, social, environmental, organizational, informational, industrial and regional specific factors.