EBRD funds largest road project in Armenia
The European Bank for Reconstruction and Development (EBRD) is lending €236 million to Armenia to finance the construction of the southern section of the Sisian-Kajaran road.
This is the largest road infrastructure project ever financed by the EBRD in Armenia. It was previously complemented by technical cooperation funding generously provided by the European Union (EU). These funds were used to undertake the feasibility study as well as the environmental and social impact assessment.
The loan agreement was signed today by the Minister of Finance of Armenia, Vahe Hovhannisyan, and EBRD Managing Director, Sustainable Infrastructure Group, Nandita Parshad during the EBRD Annual Meeting and Business Forum in Yerevan. The signing took place before the Armenia Investment Outlook session, in front of more than 200 official guests.
The funding will allow the Government of Armenia to build 24 kilometres of a new southern road section between Sisian and Kajaran, which is part of the North-South Road Corridor. The new road will enhance Armenia’s local, regional, and international connectivity, and the country’s access to international markets via the Black Sea. This important infrastructure project is aligned with EU flagship initiatives for improved land transport connectivity and building resilience in the southern regions of Armenia. The EBRD actively supports the EU Global Gateway strategy. The road will also enhance local and inter-regional connectivity by providing a faster and safer connection between the Syunik region and Yerevan, reducing the travel distance and time by half.
As Armenia is landlocked, solid road infrastructure is crucial for an efficient flow of trade that can support the value chain, increase diversification and accelerate the growth of the private sector and the economy as a whole.
EBRD Managing Director, Sustainable Infrastructure Group, Nandita Parshad said: “We appreciate Armenia’s aspiration to develop a transport and logistics infrastructure that will enhance its regional connectivity and integration with external markets. We support this project because it meets our strategic objectives in Armenia and the region. We are also grateful to our partner, the European Union, which provided technical cooperation support to ease the implementation of this important initiative.”
The EBRD is one of the largest institutional financiers in Armenia. For the past five years the Bank has invested €640 million in the country, supporting private sector development, infrastructure enhancement, renewable energy generation and rural digitalisation.
To date, the EBRD has invested over €2.1 billion in 211 projects across Armenia.