European Bank for Reconstruction and Development (EBRD) has signed a 13 million euro agreement with Ukraine's biggest parcel delivery firm Nova Poshta to help the company build an automated sorting hub in Dnipro, the financial institution announced on Dec. 29.
The new terminal in central Ukraine will allow the company to double its parcel-processing capacity in the region, according to Nova Poshta. The company says fleet efficiency would help the company cut down the number of trips, reducing its energy consumption by saving around 1,570 tonnes of CO2 equivalent per year – comparable to the emission of 800 cars.
A new intelligent system developed by Equinox, a Lithuanian robotics and logistics optimization solutions provider, will be installed in the facility.
“Receiving an EBRD loan is an indicator of Nova Poshta’s good financial health and the Bank’s trust in the company,” Petr Fokov, Chief Financial Officer of Nova Poshta, said.
The credit fund will be available in both hryvnia and euros, the bank said.
The EBRD has previously funded the construction of a similar sorting hub in western city of Khmelnytskyi. The project completed in 2019 helped Nova Poshta improve its efficiency and cut annual CO2 emissions by about 1,200 tonnes.
Even though Nova Poshta continues to dominate the postal market, its main rival Ukrposhta is slowly catching up on a competition to improve its logistics. Earlier in December, the state-owned postal service made an announcement to build seven sorting centers and 61 regional depots in western Ukrainian cities, including Lviv and Rivne.
In November, Ukrposhta has also signed an agreement to construct a fully-automated sorting center in Dnipro with a price tag of $49 million.
But Nova Poshta, with 9,300 branches and 11,000 lockers across the country, refuses to fall behind. The 20-year-old market leader said in October that it will invest Hr 1 billion (about $37 million) in the construction of a new sorting terminal near Boryspil International Airport, the country’s main international gateway. The company has also announced that its cargo airline will start operating in April 2022.
To date, the EBRD has invested almost 16 billion euros in 506 different projects across Ukraine with various focuses, such as assisting economic stabilization and strengthening energy efficiency.