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Azerbaijan, World Bank to sign new loan agreement

14 December 2009 14:51 (UTC +04:00)

Baku. Nijat Mustafayev-APA-Economics. Azerbaijan is due to sign a $450 million loan agreement with the World Bank in a few days, local railway companyâ€™s spokesman after a meeting between the representatives of the company and the World Bank.

Nadir Azmammadov said the meeting focused on the progress, current status and future plans of the Railway Trade and Transport Facilitation.

According to him, the loan approved by the WB for Railway Trade and Transport Facilitation Project will improve railway services in the country, as well as the competitiveness, financial sustainability, operating and cost efficiency, and capacity of the Azerbaijan Railways (ADDY).
The project will target the transport corridor running towards Georgia (East-West corridor).

According to the WB website, the project has four components:

The Rehabilitation of East-West Main Line component will help rehabilitate the track, signaling, and power supply along the east-west corridor. It is expected that some 240 km of mainline track, which is currently in poor condition, will be rehabilitated. Through this investment, it will also be possible to remove the most critical speed restrictions and allow ADDY to handle existing and potential traffic up to 100 km/h for passenger trains and 80 km/h for freight trains without significant track delays on those 240 km. The project will also finance the conversion of the power supply on the East-West corridor to 25 kV.
The New Mainline Locomotives component will finance approximately 50 new mainline electric locomotives to operate on the East-West corridor.
The Modernization component will help to fully implement the International Financial Reporting System (IFRS), provide Advisory services to ADDY to carry out its modernization program, and provide necessary equipment to ADDY to improve its oil spill prevention and response capacity.
The Project Implementation Component will support the Project Implementation Unit.
The Railway Trade and Transport Facilitation Project supports the implementation of the first phase of the 2008-2011 Program of Railway Modernization of the Republic of Azerbaijan. It will focus on the institutional restructuring of the Azerbaijan Railways.