ARMENIA’S CONSTITUTIONAL COURT UPHOLDS LEGALITY OF NORTH-SOUTH TRANSPORT CORRIDOR INVESTMENT PROGRAM

ARKA
Jan 28, 2010

YEREVAN, January 28, /ARKA/. Armenia’s Constitutional Court has upheld
the legality of an investment program designed to fund construction
of the North-South transport corridor, the ministry of economy said
in a statement.

It said the Court ruled that Armenia’s commitments in a framework
agreement signed with the Asian Development Bank on September 15, 2009
are in conformity with the country’s Constitution. The Court handed
a similar ruling with respect to a credit agreement signed by the
government of Armenia and the Asian Development Bank on October 12,
2009 for the initial phase of the project. The Armenian government
approved the investment program on January 14, 2010.

Armenian transport and communications minister Gurgen Sarkisian
said late in December that the construction of the first phase of
North-South Road Corridor will be launched in 2010 April. The project
will be funded by the initial loan of $60 million, earmarked by the
Asia Development Bank to reconstruct an 18 kilometer section of the
road corridor between the capital city Yerevan, and Ashtarak to the
north, and improve safety of Yerevan to Ararat road to the south.

Last year the Asian Development Bank (ADB) said it will extend up to
$500 million to Armenia to upgrade its main corridor road as part of
a broader thrust to improve connectivity, and boost trade, growth and
livelihood opportunities in the Caucasus and Central Asia subregions.

Funds will be released periodically through a multitranche financing
facility. The transport corridor will stretch from the southern
Armenian town of Meghri, on the border with Iran, to Bavra in the
north on the border with Georgia.

The project, which the minister said, is estimated preliminary to
cost $962 million, is to be over in 2106. In the second phase which
is expected to be over in 2010, a road from Ashtarak to Gyumri will
be reconstructed. In the third phase a new road from Goris to Kapan
will be constructed.

"This is a very important project for Armenia, because it is a
regional project that will connect the southern parts of Armenia with
Georgian seaports on the Black Sea and will cut the travel by 30%,’
the minister said.