The memorandum was signed by the head of the European Commission delegation in Latvia Gunter Weiss, Latvian special tasks minister for cooperation with international financial institutions Roberts Zile, and Finance Ministry deputy state secretary Inguna Sudraba.
The memorandum will provide grounds for Latvia to enter into agreements and launch the implementation of investment and technical assistance projects, with the co-financing of ISPA, in the environment and transport infrastructure sectors.
The European Commission has so far approved three environment and four transport infrastructure projects to which nearly 81 million euros have been extended from the ISPA fund while Latvia's co-financing for the projects will be 40 million euros.
"The share of ISPA financing in the major en-vironment and transport infrastructure projects in Latvia, no doubt, is a con-siderable gain for these sectors," said Zile.
All EU candidate countries will receive a total of 1.04 billion euros a year from the ISPA fund. Initially it was thought Latvia would receive 40 million to 50 million euros.
Weiss said that unlike funds provided by the World Bank and other financial institutions, this money will not have to be repaid.
In order to implement the projects, a financial memorandum will be closed for each of the projects.
At the initial stage all work will be financed by the Latvian state, local authorities or private companies, and, after the completion of the project, part of the funds will be repaid from ISPA funds. ISPA's co-financing of the projects varies from 47 percent to 75 percent of the total costs.
The implementation of the first project in Latvia supported by the European Commission could get under way in April 2001. This project involves improvement of the Via Baltica highway between the 13th and 21st kilometers. Total costs of the project amount to 6.25 million euros, of which the ISPA will cover 4.69 million euros.
The most expensive, meanwhile, is expected to be the East-West railway corridor reconstruction project, which will cost an estimated 35.24 million euros. The ISPA is expected to contribute 26.43 million euros.