YEREVAN EYES ANOTHER MASSIVE PROJECT
Asbarez
/yerevan-eyes-another-massive-project/
Aug 6, 2009
YEREVAN (RFE/RL)-The government formalized on Thursday its extremely
ambitious plans to seek more than $1 billion in external funding for
the expansion and upgrading of Armenia’s key highways which it says
would turn the country into a regional transit hub.
The government ordered relevant regional authorities to halt any
construction along hundreds of miles of roads stretching from northwest
the Armenian-Iranian border to Georgia. It also approved funding for
the first feasibility study on the project which it hopes will be
financed by the Manila-based Asian Development Bank (ADB).
"We are launching a big process of road construction," Prime Minister
Tigran Sargsyan said at a weekly session of his cabinet. "North-South
highway will meet the highest international standards," he told
ministers.
Sargsyan estimated the total cost of the project at roughly $1.5
billion, a sum worth more than half of Armenia’s state budget
for this year. He said the Armenian government has already asked
the ADB for a $700 million loan to finance the first phase of road
reconstruction. The bank’s governing board will consider the request
when it meets next month, he added.
Transport and Communications Minister Gurgen Sargsian said last month
that Yerevan and the ADB are already negotiating on the release of
$1 million in funding for the comprehensive feasibility studies on
the project.
"The project enables us to play a serious transit role in the region,"
he told journalists. "So it’s not an Armenian project, it’s a regional
project."
Sargsian said that neighboring Iran would find it much easier to use
Armenian territory for cargo shipments to and from Georgia and other
countries. He also stressed that the upgraded roads would connect
to a highway in southern Georgia leading to the Black Sea ports of
Batumi and Poti.
The Armenian and Georgian governments agreed last year to jointly
seek external assistance for rebuilding that highway and thereby
significantly shortening travel between Armenia and the Georgian Black
Sea coast. The issue was on the agenda of Georgian President Mikheil
Saakashvili’s recent visit to Yerevan. Sarkisian said afterwards that
the ADB has agreed in principle to finance the project.
The bank was already approached by the Yerevan government last year
over the financing of an even more ambitious project to build a
railway connecting Armenia and Iran. Expert says its implementation
would cost more than $1 billion.
The figure pales in comparison with at least $5 billion need for the
construction of a new reactor at the Metsamor nuclear power plant
planned by the government. The latter insists that foreign investors
have shown an interest in the project. But it has still not named
any of them.