Data Collection Survey on Logistics and Transport System in Southern Ukraine Final Report June 2017 JAPAN INTERNATIONAL COOPERATION AGENCY PADECO Co., Ltd. Pacific Consultants Co., Ltd. 7R JR 17-014 Data Collection Survey on Logistics and Transport System in Southern Ukraine Final Report Contents List of Figures..........................................................................................................................iv List of Tables ........................................................................................................................ viii Abbreviations ........................................................................................................................... x Executive Summary ............................................................................................................ E-1 1. Introduction................................................................................................................... 1-1 1.1 Study Background ............................................................................................... 1-1 1.2 Objectives............................................................................................................ 1-1 1.3 Study Area ........................................................................................................... 1-1 1.4 Study Tasks ......................................................................................................... 1-2 1.5 Study Schedule .................................................................................................... 1-2 2. National Transport Policies and Plans .......................................................................... 2-1 2.1 National Transport Policies and Plans .................................................................. 2-1 2.1.1 National Development Plan .......................................................................... 2-1 2.1.2 National Transport Strategy and Its Priorities................................................ 2-2 2.2 Donor Assistance to the Transport Sector in Ukraine ............................................ 2-3 2.2.1 USAID......................................................................................................... 2-3 2.2.2 European Investment Bank (EIB) ................................................................. 2-4 2.2.3 The World Bank Group ................................................................................ 2-5 2.2.4 European Bank of Reconstruction and Development (EBRD) ....................... 2-6 3. Analysis of Road Subsector ........................................................................................... 3-1 3.1 Overview of National Road Network ................................................................... 3-1 3.2 Roads in Ukraine ................................................................................................. 3-2 3.2.1 Network ....................................................................................................... 3-2 3.2.2 Issues in Quality of Maintenance .................................................................. 3-3 3.2.3 Institutional Framework of Road Administration .......................................... 3-5 3.2.4 Organizational Structure of Ukravtodor ........................................................ 3-7 3.2.5 Capacity Improvement of Ukravtodor .......................................................... 3-9 3.2.6 Relevant Laws and Regulations on Roads ................................................... 3-11 3.2.7 Engineering Standards.................................................................................3-17 3.2.8 Strategy for the Road Sector ........................................................................3-20 3.2.9 Donor Assistance for Road Sector ...............................................................3-21 3.2.10 Ongoing and Planned Projects .....................................................................3-24 3.3 Highways in the Southern Region .......................................................................3-28 3.3.1 Road Network .............................................................................................3-28 3.3.2 Major Issues ................................................................................................3-30 3.4 Mykolaiv Bridge Construction Project ................................................................3-33 3.4.1 Status of the Project ....................................................................................3-33 3.4.2 Specifications of the Mykolaiv Bridge as Planned in the Preparatory Survey in 2011 ............................................................................................3-34 3.4.3 O&M Consideration of the Project ..............................................................3-36 3.4.4 Status of the Existing Bridges in the City.....................................................3-36 i Data Collection Survey on Logistics and Transport System in Southern Ukraine Final Report 3.4.5 Price Changes for Bridge Construction Cost Estimates ................................3-38 3.4.6 Capabilities of Local Contractors in Bridge Construction ............................3-42 4. Analysis of Seaport Subsector ....................................................................................... 4-1 4.1 Introduction ......................................................................................................... 4-1 4.2 Overview of the Port Sector in Ukraine ................................................................ 4-1 4.2.1 General Introduction of Ukrainian Port Sector .............................................. 4-1 4.2.2 Categorization of Ukrainian Seaports ........................................................... 4-2 4.2.3 Changed Port Landscape .............................................................................. 4-2 4.3 Institutional Framework ....................................................................................... 4-3 4.3.1 Relevant Laws and Regulations on Seaports ................................................. 4-4 4.3.2 Findings on the Ukrainian Port Reform ........................................................ 4-5 4.3.3 Strategy for the Port Sector .......................................................................... 4-6 4.4 Handling Cargo Volume and Cargo Demand Forecast of Major Cargos at Major Ports .......................................................................................................... 4-9 4.4.1 Methodology ................................................................................................ 4-9 4.4.2 Demand Forecast Results ............................................................................4-10 4.4.3 Conclusions – Main Forecast Results ..........................................................4-26 4.5 Capacity in Major Ports: Actual Capacity and Capacity Needs ............................4-27 4.5.1 Current Capacity .........................................................................................4-27 4.5.2 Hinterland Connection ................................................................................4-38 4.5.3 Conclusion – Current Capacity ....................................................................4-39 4.5.4 Capacity Needs ...........................................................................................4-40 4.5.5 Conclusion ..................................................................................................4-42 4.6 Current Status and Challenges of the Sea Port Authority .....................................4-43 4.6.1 The Ukrainian Sea Port Authority ................................................................4-43 4.6.2 Current Status of Port IT Systems, Customs and Other Regulatory Controls ......................................................................................................4-46 4.7 Donor Assistance for Seaport Sector ...................................................................4-48 4.7.1 The World Bank Group ...............................................................................4-48 4.7.2 European Bank of Reconstruction and Development (EBRD) ......................4-49 4.7.3 European Investment Bank (EIB) ................................................................4-50 4.7.4 The Netherlands ..........................................................................................4-51 5. Road Traffic Characteristics and Forecast ................................................................... 5-1 5.1 Traffic Issues in the Southern Region and Its Surroundings .................................. 5-1 5.1.1 Russian Transit Decrease due to 2014 Event vs Export Products Growth ...... 5-1 5.1.2 Grain Product Policy and Logistic Chain Development by IFIs..................... 5-3 5.1.3 Iron Ore and Steel Products Export and Its Logistic Chain ............................ 5-9 5.1.4 Industrial Development Potential in Mykolaiv and M-14 .............................. 5-9 5.1.5 Bottlenecks in Regional Transport and Urban Transport ..............................5-10 5.1.6 Summary ....................................................................................................5-14 5.2 Review of Traffic Forecast in The Preparatory Survey in 2011 ............................5-16 5.2.1 Comparison of Traffic Counting ..................................................................5-16 5.2.2 Review of the Forecast Model in