New project in the field of municipal economy starts.

In July 2003 a project aimed at improving water supply and sewage systems in pilot cities of the Russian Federation started. The project is financed by German Development Bank (KfW) on behalf of the German Federal Ministry of Economics and Labour.

One of selection criteria for Russian municipalities was existing partnership with German cities since municipal administrations and enterprises of German twinning cities will be actively involved into the project activities.

As a result of the selection process the following pairs of twinning cities will take part in the project:
Vladimir - Erlangen
Kostroma - Aahen
Pskov - Neuss
Yaroslavl - Kassel

During the fhe first project stage, which should be finalised before March 31, experts from OST-EURO and German twinning cities will provide consultancy to pilot Russian municipalities and companies necessary for joint development of water supply and sewage system reforming (improving) concept (plan).
In frame of this project it is planned to summarize and multiplicate the acquired experience. For this purpose co-operation with the Union of Russian Cities and other interested parties is planned.

22.09.2003 the project kick-off conference  took place in the German Embassy in Russia.  

Pilot Russian and German cities, representatives of a number of Russian and German Federal ministies, German Embassy, EC Delegation, experts in municipal economy participated in the conference.

During the conference project agreements were signed with the parties.

A Round Table on "Legal-administrative and property aspects of water supply and sewerage" took place in Vladimir on October 21, 2003. The action was held in scope of the KfW project "Enterprise Reform and Development in the sphere of water supply and sewerage in the Russian Federation" of the Transform program initiated by the German Government. The meeting was arranged by company management of the "Vladimirvodokanal" municipal unitary enterprise led by its director Zelenin V.E.

Representatives from pilot cities and water supply and sewerage enterprises from Vladimir, Kostroma, Yaroslavl and Ivanovo took part in the Round Table discussion. Experts of OST-EURO headed by the project manager E.Markwart and invited specialists from Gosstroy of Russia, the Institute for Urban Economics and the Union of Russian Cities took part in the conference.

The following issues were discussed at the meeting:
- principles of property relations between municipalities and water supply enterprises under reforming conditions;
- possible models of legal administrative and property relations in the sphere of water supply and sewerage as well as implementation options (incl. German examples);
- approaches to reforming legal-administrative and property relations in the pilot cities.

The project positions on important issues of property relations and legal-administrative forms as well as individual opinions of participants were identified in the course of the discussion and speeches of Dr.Markwart, director of Urban Economy Department of the Institute for Urban Economics S.Sivaev, team leader of the Tacis project "Management of Municipal Services Dr.Kilimann, the Chief executive of the HCS economy department of Gosstroy of Russia L.Solovyeva, the chief executive of "Yaroslavlvodokanal" A.Aniskin and others. The participants discussed privatisation opportunities as well as concession, leasing and trust management tools specific for municipal economy. On the whole, management of water supply and sewerage enterprises in the pilot cities realize the necessity of reforms and are prepared for changes.

Russian experts from the city of Kostroma visiting Aahen
Reception at the city hall
On the border of the three states - FRG, Belgium and the Netherlands	Visiting local utilities