The United States, through USAID, and JSC Ukrainian Railways (UZ) signed a Memorandum of Understanding to mutually support the development of a 75-kilometer (47-mile) segment of dually gauged rail which will connect Lviv, a planned transportation hub in western Ukraine, to the Trans European Network for Transport. This partnership, which will result in $225 million in funding for this rail segment, underscores the United States' commitment to investing in alternative export routes for Ukraine's agricultural products, and emphasizes the critical importance of infrastructure such as rail to Ukraine's recovery.
Supported by a planned $225 million investment of USAID funding for this rail segment, the agreement underscores the United States’ commitment to investing in alternative export routes for Ukraine’s agricultural products, and emphasizes the critical importance of infrastructure like rail to advance Ukraine’s recovery. By investing to improve land and rail border crossing points, grain export capacity could be increased by an estimated 2.5 million metric tons per year, boosting exports by up to $425 million. This project will help bolster Ukraine’s connectivity to Europe, while enabling Ukraine’s economic resiliency and helping to ultimately reduce its reliance on donor budget support. Ukraine’s railway uses wide-gauge tracks. The European rail network, on the other hand, uses standard-gauge, narrower tracks, which requires cargo wagons to be unloaded and reloaded at border checkpoints, a process that often takes more than 5 hours per train and thereby limiting the number of trains that can pass from Ukraine into Europe each day.
This time consuming process often leads to inefficient transportation of grain and other agricultural products. USAID’s technical support will enable UZ to develop this dually gauged rail segment, which will help speed up the transport of Ukraine’s goods to the European Union and provide faster routes for displaced Ukrainian citizens to return home. By connecting European rail corridors to Lviv, agricultural products can be directly loaded onto narrow narrow gauge hoppers or rail cars, and fast tracked to European ports and markets.
On November 8, 2023, Secretary of Transportation Pete Buttigieg and Ambassador Bridget A. Brink met with UZ Chairman of the Board Yevhen Lyashchenko and Deputy Prime Minister Oleksandr Kubrakov to discuss UZ’s wartime successes and challenges, the importance of American/Ukrainian collaboration, and the importance of USAID’s support in developing the Mostyska-Lviv Rail Segment.