ST. PETERSBURG MUNICIPAL SUPPORT PROJECT

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The project is aimed at the restructuring of St Petersburg's high-cost short-term debt in order to stabilise the city's financial position, and to implement a prioritised medium-term investment programme. This operation helps to: a) restructure St Petersburg's high-cost short-term debt so that the city is able to stabilise its financial position and finalise and implement its investment programme; and b) ensure that the city continues to implement measures to improve its financial management and investment planning, which will enhance the city's creditworthiness and help to attract private capital to partially finance its investment programme. The EBRD has accelerated and directly assisted the process of St Petersburg's municipal reforms in a wide range of areas, including a comprehensive set of reforms of municipal finances, restructuring of municipal services and reforms in the related legal and regulatory framework. As a result of this cooperation, St Petersburg is already on the verge of establishing itself as a creditworthy borrower on the international financial markets. The project directly helped introduce St Petersburg to the Eurobond market. In the framework of its cooperation with the St Petersburg authorities, the Bank has contributed directly and through a large number of Technical Assistance programmes to a transfer of financial, managerial, organisational and strategic planning skills to the local government and set standards for market-oriented behaviour patterns. The results of this learning-by-doing process are being experienced well beyond the specific project, primarily through the city's interactions with its business clients and the lower levels of the local government. The city of St Petersburg. A Framework Loan Agreement of up to US$ 100 million signed in July 1998, with a first tranche of US$ 30 million signed in August 1998, and a second tranche of US$ 15 million signed in November 1998. The project also had a Eurobond issue of US$ 300 million. The EBRD co-lead managed the Eurobond issue in June 1997, with EBRD participating in its financing with US$12.5 million. US$ 400 million. There are no direct environmental issues associated with this project. a. Developing the city's investment planning and programming ability. b. Developing the city's borrowing programme. c. City revenue enhancement and transport sector efficiency audit. Other technical cooperation projects have also been completed.