Arad Urban Transport Project

complete

The proposed project is intended to improve the City of Arad’s urban transport infrastructure through investment in (i) tram track rehabilitation (ii) street upgrading in the city centre (iii) traffic signal modernisation. The project is also intended to improve the overall operational performance of the public transport system in the city of Arad. Currently, the EBRD is considering extending a financing to the City of Arad to complement an existing loan signed in 2005. The operation will enable the City to (i) complete the existing work programme and (ii) to continue with the phase 2 of a comprehensive tram track rehabilitation programme in the city. The proposed project will improve the performance of the public transport system through increased commercialisation of the public transport company. This will include implementation of a multi-year Public Service Contract between the City and the company as well as the involvement of the private sector, as appropriate. The terms of a Public Service contract are expected to include (a) a transparent multi-year payment for service (b) utilising targets and incentives to increase efficiency (c) making the company responsible for investment planning and financing. Arad Municipality, located in the western part of Romania, has a population of 173,000. A sub-sovereign loan to Arad Municipality of EUR 20 million. An additional financing to Arad Municipality of up to EUR 13 million Approximately EUR 41.8 million. The original project was screened B/0 requiring an Environmental Analysis. The Analysis, undertaken by local independent consultants, confirmed that there are no significant environmental impacts associated with this operation and a number of very tangible environmental benefits are likely to arise. A comprehensive environmental action plan (EAP), was also developed, and has been implemented to ensure compliance with both national and European Union environmental requirements. The upgraded tram infrastructure will be more efficient in the transmission of electricity through reduced power losses. Noise and vibration from tramway tracks will also be reduced. In addition to reduced emission levels, the Bank's project will continue to bring environmental benefits by enabling the provision of better quality public transport services and providing an attractive alternative to the car for travel within Arad. Technical Cooperation assistance is provided to assist the city of Arad in the development of private sector participation and commercialization of the Public Transport company. The assignment is financed by the Government of Italy.