RAILWAY AGREEMENT SIGNED

AZG Armenian Daily
14/02/2008

Economy

Yesterday was signed the agreement of transfer of the "Armenian
Railways" governmental enterprise to concession of the "Russian
Railways" OJSC. The agreement was signed by Minister of Transport
and Communication of Armenia Andranik Manoukian and President of
"Russian Railways" OJSC Vladimir Yakunin.

According to the agreement, "Armenian Railways" is transferred to
concession for 30 years with a 20-year renewable period. The investment
plan says the Russian Railways pledge to invest in development of the
infrastructure $570 million within 30 years, including $230 million
within the first 5 years in the modernization of the railroad, repair
and acquisition of equipment, on the whole. In addition, the investor
will come out as a guarantor of the investments. The concessionaire
is to make a $5 million initial contribution. Annual payments to the
state budget will total 2% of incomes (except proceeds from passenger
transportation). The Minister said some procedural issues connected
with transfer of property still need solution. The concessionaire
will launch its activity in the second half of 2008.