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The Asian Development Bank's (ADB) management approved allocation of the second tranche worth $300 million to improve water and sanitary services in Azerbaijan, ADB's website reported on Thursday.
"The Bank planned to approve a loan by late 2011, but it didn't happen only due to technical reasons, as negotiations were successful," ADB Office told on Thursday.
The loan will be used for completion of work on water and sanitation improvement in Agdash, Goychay, Nakhchivan and Beylagan.
To date ADB has financed two water supply and sanitation improvement projects in Azerbaijan. The first, a $30 million loan assigned in 2004, saw the rehabilitation of the water supply system in Gekchay and Nakhchivan under a project valued at a total of $39.9 million. That loan period expired on June 30, 2011.
As the cost of the project approved for five years increased and in order to give full coverage of works in the above regions, ADB assigned $75 million under the MFF as the first tranche, whereas the Government of Azerbaijan assigned $25 million. The loan amounting to $300 million will be allocated in the frame of the second tranche.
All the project works have been completed. These include the construction of water intake and Azersu district offices.
The first tranche of funds was intended to cover the additional costs associated with the rise in price and was approved five years ago to improve water and sanitation services in Goychay and Nakhchivan. The draft was prepared in 2004 and during this period, prices for construction materials significantly increased, especially in terms of sanitation. In addition, the ADB draft provides complete restoration of water supply and sanitation services in the selected areas.
Gemi Qaya is selected as a contractor for the construction work in Nakhichevan, and the executor of the project in this area is the State Committee for Land Reclamation and Water Management of the Nakhchivan Autonomous Republic.
In late 2011 the contractor invited to work on the Goychay project the Turkish company, Atinak.
The MFF was approved to the sum of $600 million by the ADB Executive Board in September 2009. The ADB plans to approve the third, $175 million tranche of the loan on December 31, 2012.
The multi-tranche financing has been the basis of 8-year cooperation between the ADB and the Government of Azerbaijan.
The consultant of joint-stock company Azersu under the Project is consortium AICO Consulting Ltd./European Consultants Organization.
Trend.az
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