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IBRD allocates $220 million to Azerbaijan

23 September 2013 10:58 (UTC +04:00)

Baku. Aynur Aliyeva - APA-Economics. On September 20 the Azerbaijan Ministry of Transport and the World Bank signed the agreement on $220 million additional funding to Rail Trade and Transport Facilitation Project in accordance with the standards of the International Bank for Reconstruction and Development (IBRD). The beneficiary of the project is Azerbaijan Railways JSC, APA reports.

According to the Ministry of Transport, the agreement has been signed by the Minister Ziya Mammadov and Larisa Leshchenko, the World Bank Manager for Azerbaijan.

“Additional credit is allocated for 23 years with 8 years of grace period on annual rate LIBOR + 0,25%”, - the Ministry said.

On 27 June the World Bank Board of Executive Directors approved additional financing for the Rail Trade & Transport Facilitation Project.

The new financing is allocated in addition to the original $450 million WB loan. The additional funding will be mostly used for power conversion and upgrading the railway signaling system from Baku to the border with Georgia; the current systems limit traffic to one train every 35 to 40 minutes. Bombardier will be a subcontractor for the development of additional funding.

“The new power supply and signaling systems will modernize the operation along Azerbaijan’s key transport corridor, allowing trains to run at 8 minute intervals which will increase the network capacity by four times”, indicated Jacques Buré, WB Senior Highway Engineer and a leader of the project.