Issue of $200mln EFSD loan to be submitted to Armenian NA for ratification

ArmInfo. The Eurasian Fund for Stabilization and Development will provide Armenia with a loan of $200 million to finance the construction of the Kajaran tunnel. At a meeting on August 15, the RA government approved the draft law "On ratification of the agreement between the Republic of Armenia and the Eurasian Development Bank", which manages the EFSD funds.

As noted in the justification of the draft agreement, the goal of the program is to increase the potential for transit transportation and reduce accidents on the North-South road corridor. The length of the tunnel will be 7 km, it is planned to build it within 6 years. It is also planned to overhaul the access roads leading to the tunnel with a total length of 4 km. The total cost of the project is estimated at $370 million. The loan is provided at an annual rate of 4% with a repayment period of 20 years.

The new 60-kilometer Sisian-Kajaran road will be of the second technical category. It will pass through difficult mountainous terrain, will include 27 bridges with a total length of 4.7 km and 9 tunnels with a total length of 12.5 km (the longest is the Bargushat tunnel, about 8.6 km long). The pre-qualification stage of the international tender for this project has been completed, with applications submitted by 23 companies from Europe, China and other countries. Of the total financial assistance package from the EU to Armenia in the amount of 2.6 billion euros over the next five years, 600 million euros will be directed to the construction of the Kajaran-Sisian road. The 60-km section of the road will have a design speed of 80 km/h.

The North-South project will reduce the distance from the Iranian border to the Georgian border from 556 to 490 kilometers. The road will significantly facilitate access to the Black Sea not only for Armenia, but also for Iran. The project will provide access to the Black Sea and to European countries through the territory of Armenia (Meghri-Kapan-Goris-Yerevan-Ashtarak-Gyumri-Bavra) and Georgia. The construction of the corridor was initially planned to be completed in 2019. The cost of the program was constantly revised upwards. Meanwhile, in September 2012, when the construction of the highway began, the amount named by representatives of the Armenian government was several times less - $962 million, today we are talking about investments of about $3 billion.