The Armenian Government has approved a draft agreement with the Asian Development Bank. Under the agreement, the country is to receive a $112.97 mln tranche for the North-South transport corridor project.
Armenian Minister of Transport and Communication Gagik Beglaryan said that the funds are provided on preferential terms: the redemption period is 22 years, with the grace period being 15 years, and the interest rate is 6-month Libor + 0.2%. To recall, the Government of Armenia approved the investment program of the North- South transport corridor on Jan 14 2010 and a framework financial agreement between Armenia and ADB in the amount of 500 million dollars. The North-South 556km motorway will be laid via the Armenian towns of Meghri-Kapan-Goris-Yerevan- Ashtarak-Gyumri-Bavra and enter the territory of Georgia on Akhaltsikhe-Batumi section, which will settle some transport problems of Armenia. This will be a four-lane motorway of reinforced concrete extending from the Armenian border and Iran to the Georgian port Batumi. The road corridor will facilitate improving the road connection with the two neighbors of Armenia: Iran and Georgia, providing access to international trade routes and markets. Agarak-Kapan-Yerevan-Gyumri_Bavra road links the South of the country with the North providing access to "Southern Road Corridor" of Georgia which enables access to Poti and Batumi ports or to the East towards Tbilisi. Armenia raised $500mln loan from the Asian Development Bank for the project that is estimated at $1 billion. Eurasian Development Bank is ready to provide $150 million. Armenia raised $60 million from the European investment Bank. Due to the project, the overland communication Europe-Caucasus-Asia will be improved. The project will be completed by 2019. It will allow Armenia to soften the consequences of the blockade by Azerbaijan and Turkey and to join the Black Sea ring highway. North-South project was initiated by Russia and Iran and implies activation of transport activity, including through construction of new transport communication Russia- Iran-India. Armenia and Iran top leaderships are studying construction of a railway to link the two countries and become part of North-South transport corridor.