Azerbaijan, Baku, April 21 / Trend, N. Ismayilova /
Approval of loan agreement in a third project to expand the Baku-Shamakhi-Mugan Highway from two to four lanes is scheduled for May 25, the WB Baku Office reported
The bank will allocate $241.6 million to finance the project in the form of mixed credits, of which $70 million will be funded by the WB's International Development Association (IDA), and $171.6 million by the International Bank for Reconstruction and Development (IBRD). The remaining funds account for the state's participation in the project The total project cost is estimated at $353 million compared to the $296 million projected earlier. Including VAT, the project cost will be roughly $350 million.
Formal talks between the Azerbaijani Government and the World Bank under the loan agreement were held in Baku April 5-9.
The length of Baku-Shamakhi-Mugan is 122 kilometers. A total of 101 kilometers will be built within the draft under discussion. The remaining road has already been built. The ministry reported that the work on the road's design along a 15-45-kilometer interval has already been completed. The ministry has already announced a tender on the project to define a contractor.
Construction costs were estimated at $90.11 million. Initially, construction work worth $72.09 million was planned at the expense of the WB, and $18.02 million at the expense of Azerbaijan.
Azerbaijan became a WB member in 1992. During this period, the bank has approved loans worth $2.5 billion to finance 47 projects. In the 2008 fiscal year alone, the bank intended to finance 13 projects worth $1.251 billion, thus accomplishing the four-year budget strategy in two years. Over the next two years (2009-10 years), the WB has expressed readiness to allocate more than $1 billion on commercial terms from the IBRD.