Thursday, November 9 2023 14:50

ArmInfo.The Asian Development Bank (ADB) will provide Armenia with a loan of 60 million euros for  the development of the capital's infrastructure.

The program with a budget of 60,090,000 euros, aims to develop urban  infrastructure through the construction of a new section of the  Isakov-Arshakunyats road, which will connect 3 administrative  districts of Yerevan and significantly reduce congestion in the city.  As a result of the project, it will be possible to reduce the  existing road (by approximately 1.8 km), city traffic jams, and  create new urban infrastructure (another bridge will be built across  the Hrazdan River).

The loan is provided for a period of up to 27 years with a 10-year  grace period and a repayment period of 17 years, on the following  conditions: the deadline for disbursing loan funds is 03/31/2028;  loan interest rate type - floating; annual interest rate on the loan  - 6-month EURIBOR + 0.5% margin + 0.3% (repayment premium);  commitment fee - annual rate of 0.15%, calculated from the unclaimed  loan amount, the beginning of the calculation is the 60th day after  the date of signing the agreement, paid semi-annually, simultaneously  with the payment of interest on the loan; repayment of the principal  amount of the loan refers to the entire loan amount, the repayment  method is equal payments.

The Borrower may at any time contact the Bank with a request to make  the following changes to the terms of the loan: fully or partially  convert the currency of the used and outstanding amount or unclaimed  loan amount into another currency acceptable to the Bank; convert the  interest rate of the used and outstanding loan amount or part thereof  from floating to fixed and vice versa.

The Ministry of Justice, when reviewing the agreement, noted that  "although the draft does not contain norms providing for changes in  the law of the Republic of Armenia or the adoption of a new law, it  does contain a norm that contradicts the law." In particular, as  noted, the project provides for "if necessary, the participation of  the Asian Development Bank in domestic operational investigative  processes." Meanwhile, Article 8 of the Law "On Operational  Investigative Activities" clearly lists the bodies that have the  right to conduct investigations in cases and in the manner  established by law, and the Asian Development Bank is not included in  the list of bodies carrying out operational investigative activities  at the level of domestic legislation, in Therefore, the Ministry of  Justice proposed to revise this provision. At the same time, it is  reported that the draft in its current version is subject to  ratification.

The Yerevan Urban Development Investment Project aims to enhance the  economy, livability, and inclusiveness of Yerevan, the capital city  of Armenia, through improved sustainable urban mobility and services  (output 1) and strengthened institutional capacity for green and  inclusive urban mobility (output 2).  It aims to support Yerevan in  improving the urban environment, enhancing the road network, and  promoting climate-resilient infrastructure. The project will benefit  up to 1.2 million people.

ADB has been working with Armenia since 2005. As of 2022, the Bank  provided Armenia with 37 loans, grants, and technical assistance  worth about $1.6 billion, which were aimed at developing transport,  financial, energy, water sectors, infrastructure, etc.

According to the Ministry of Finance, by August 31, 2023, Armenia's  public debt amounted to $11 billion 387 million, of which government  debt was $10 billion 844.1 million. At the same time, ADB is the  second largest creditor of the government - 18.6%.