Infrastructure with a guarantee – Newspaper Kommersant No. 143 (7344) of 08/09/2022

To support private infrastructure projects, the government is ready to provide state guarantees for loans or bonded loans, through which financing is provided. The amount of collateral is from 2 billion rubles, but not more than 50% of the debt. As follows from the adopted government decree, Russian companies that have invested at least 20% of their own funds in projects will be able to apply for support. Experts believe that this measure will increase lending to infrastructure projects, primarily by reducing risks for lenders.

The government, as a measure to support private infrastructure projects, is introducing a mechanism of state guarantees for them. As Prime Minister Mikhail Mishustin said yesterday at a meeting with his deputies, this should increase the attractiveness of investment in projects in such areas as transport, construction, housing and communal services and energy. State guarantees will be provided to secure commercial loans and bonded loans. The latter, we recall, are carried out as part of the program for issuing infrastructure bonds – funds (the issuer is a subsidiary of Dom.RF) are sent to developers in the form of soft loans.

As follows from the government decree, guarantees will be provided in the amount of 2 billion rubles. They will cover up to 50% of the principal debt on a loan taken for a period of 3 to 30 years. However, if other financial state support is provided during the implementation of the project, then its total amount, together with the state guarantee, should not exceed half of its cost.

Among the requirements for the project is that at least 20% of its cost must be financed from the investor’s own funds. The projects themselves will be selected by an interdepartmental commission under the Ministry of Economy – if the amount of supposed guaranteed support fits into 10 billion rubles. If a larger amount of collateral is needed, a subcommittee on improving the stability of the financial sector and certain sectors of the economy of the government commission on improving the stability of the Russian economy in the face of sanctions. The final decision to grant a guarantee is made by the government.

Alexey Mostovshchikov, a member of the General Council of Delovaya Rossiya, believes that the proposed scheme looks very relevant, since for many business representatives it is difficult to obtain loans due to the need to provide a guarantee – “that is why there are various structures that can provide it under certain conditions.”

As Anna Batueva, Managing Director for Legal Support of the National PPP Center, notes, this measure is aimed at attracting more credit funds for infrastructure development. For companies, the availability of loans will generally remain at the same level – a state guarantee can only be obtained if collateral is provided for the recourse requirements of the Russian Federation, in particular, a guarantee or collateral. “It’s more about reducing the risks of repayment of loans for financing organizations,” Anna Batueva believes, noting the great need for state co-financing of project costs.

Evgenia Kryuchkova