ArmInfo. The KfW Bank will provide EUR 116.4mln to Armenia under the concessional lending programmes in SMB and renewable energy sectors. The Standing Committee on Financial-Credit and Budgetary Affairs, RA Parliament, approved on Monday the ratification of an Armenian-German intergovernmental agreement on financial cooperation for 2020.
RA Deputy Minister of Economy Rafael Gevorgyan said that the funds will be provided for specific purposes: EUR 40mln for 16 years will be allocated for loans in the renewable energy sector, with EUR 70mln to SMBs for 12 years. The loans will be provided at the LIBOR plus 60 basis points.
Mr Gevorgyan said that the funds will be distributed among the programme beneficiaries by means of banks.
Earlier, ArmInfo reported that the German bank KfW will provide Armenia a grant of 23.2 million euros for the implementation of a program for the preservation of biodiversity and sustainable local development. Grant funds were provided by the German Federal Ministry for Economic Cooperation and Development. The volume of financial assistance from Germany is unprecedented in the region and is one of the largest globally.
In addition, KfW, with the co-financing of the Armenian government, is assisting in the implementation of the program for the construction of the Kaps Reservoir and a gravity irrigation system, the total budget of which amounted to 60 million euros. At the first stage, it is planned that the volume of the reservoir will be 25 million cubic meters, after which it will reach 60 million cubic meters. Within the framework of the program, it is planned to build a dam and auxiliary structures of the Kaps reservoir, re-equip the hydrological observation networks of the Akhuryan River (from Lake Arpi to the Akhuryan Reservoir), build additional stations and create a centralized database (SCADA system). As a result of the successful implementation of the program, it will be possible to replace the mechanical irrigation system by gravity, covering 2280 hectares of land. Thus, it will be possible to save 1.3 million kW / h of electricity.
It is also planned to build a 400/500 kV power transmission line Iran-Armenia-Georgia. For this purpose, it is planned to build 2 electric substations "Airum" and "Ddmashen". According to FICHTNER, the preliminary cost of the Armenia-Georgia power transmission construction program is 326.9 million euros, 10% of which should be part of Georgia's contribution. For these purposes, three loan agreements were signed in 2014-2015. In particular, the German bank KfW allocated 168 million euros in the form of a loan, another 10 million euros will be provided by the European Investment Bank. It is expected to receive another 10 million euros in the form of a grant from the European Commission.