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ADB to allocate $350 million for transport infrastructure development

2 October 2014 11:34 (UTC+04:00)
ADB to allocate $350 million for transport infrastructure development

By Nigar Orujova

The Asian Development Bank plans to allocate $350 million for the development of transport infrastructure in Azerbaijan over the next three years.

This was announced in the bank's new strategy of cooperation with Azerbaijan for 2014-2018 approved by the ADB Board on September 30.

"These loans are supposed to be given from 2015 to 2017. The bank intends to apply a systematic approach to the development of transport infrastructure network in Azerbaijan that will promote the development of non-oil sector of the country," the new strategy reads.

"A particular attention will be paid to the East-West corridors (within the CAREC 2 program) and North-South, which are among government's main priorities. The financial assistance of ADB is expected to contribute to a more rapid completion of the construction work of these corridors," the strategy said.

Expansion of opportunities for the rural population of Azerbaijan is an important aspect of ADB's support and it will have a positive impact on the economic diversification of the country. The involvement of rural roads in the North-South transportation network will make it possible to increase the access of rural population to markets, educational and medical institutions.

By 2020, the turnover of goods in Azerbaijan will increase by 25 percent compared with 2010. This year it amounted to 11,325 million metric tons/kilometers, passenger traffic - 20 percent (it amounted to 16,633 million passengers/kilometers in 2010). ADB expect the fatalities to be reduced by 25 percent for every 100,000 people (from 10.3 percent in 2010 to 7.7 percent in 2020).

The number of passenger buses running in the city center will be reduced from 700 units in 2014 to 400 units in 2018 with no change in the quality of services.

ADB's support for railways expansion will be made as part of its technical assistance.

Meanwhile, the bank plans to allocate $752 million for infrastructure projects in the areas of transport, energy, water supply and other urban utilities and services, while some 46.5 percent will be allocated for financing the road projects.

In recent years, Azerbaijanis have started to travel more inside the country, as a 41 percent increase was recorded in the number of passengers traveling within the country in 2007-2012.

Over the past 10 years, the length of constructed, reconstructed and repaired roads in Azerbaijan amounted to 8,332 km, with 222 new bridges and overpasses.

A great deal of works have been carried out to expand the roads of the capital Baku where more than 60 overpasses and tunnels were put into operation. The new facilities unloaded the busy roads of the city with about 70 percent of the country's cars.

Earlier, ADB's Board of Directors approved a loan worth $250 million for the construction of Azerbaijan's Masalli-Shorsulu highway.

"The total cost of the project is $332 million, some $82 million of which would be provided by the Azerbaijani government," ADB said.

ADB allocates the loan as part of a second multi-tranche package aimed at constructing new roads in Azerbaijan.

ADB provides the loans for roads construction in Azerbaijan in the form of multi-tranche packages.

The first multi-tranche package of ADB worth $250 million was aimed to construct the four-lane Masalli-Jalilabad road. The total cost of the project amounted to $312 million, $62 million of which was provided by the Azerbaijani government.

The second multi-tranche package of ADB worth $500 million is aimed to construct the Masalli-Shorsulu highway to a length of 63 kilometers, consisting of two parts: Masalli-Jalilabad (32.2 kilometers) and Jalilabad-Shorsulu (over 30 kilometers).

The total cost of the project is $625 million, $125 million of which will be provided by the country's government.

Established in 1966, ADB is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. The bank is owned by 67 members, including 48 from the region. Azerbaijan's share in the bank's capital is 0.5 percent.

Overall, ADB has provided Azerbaijan a total of about $1.64 billion for the implementation of 20 projects for the entire period of cooperation, the data for the end of 2013 shows.

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