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WB, Kazakhstan ink $2.125bln Agreement on South-West project

Business Materials 15 June 2009 10:29 (UTC +04:00)

Kazakhstan, Astana, June 15 / Trend , K.Konyrova/

World Bank (WB) and the Republic of Kazakhstan signed $2.125 billion Agreement on construction of the South-West highway, WB press service reported.

"The loan will be used to improve the road length of 1,062 kilometres in the international trade corridor linking China with Russia and Western Europe, and passing through the territory of Kazakhstan," the press release said.

The Loan Agreement was signed by Vice-President of the World Bank's Europe and Central Asia Shigeo Katsu and the Minister of Finance of Kazakhstan Bolat Zhamishevym.

"The modern highway will be able to provide services of high quality freight carriers. In this regard, we expect that the volume of traffic on the reconstructed road will increase significantly, as the corridor for 3,000 kilometres shorter than any other routes connecting Europe with China," Katsu said.

World Bank granted a loan for 25 years with a 5-year grace period during which the loan is not made.

It was expected that the Loan Agreement will be ratified by the Parliament of the Republic of Kazakhstan in September 2009 and the first construction contract will be issued no later than fall of this year

"This project is part of the Government of Kazakhstan for the development of international transit corridor at a cost of $6.7 billion, which will be improved roads CAREC length of 2,800 kilometers from the Kazakhstan border with China (Khorgos) to the border with Russia (Zhaysan)," the press release said.

Transport and Communications Ministry of Kazakhstan Road Committee is the office responsible for implementation of the project.

World Bank's task in Kazakhstan is to improve the living conditions of people through the promotion of diversification and competitiveness of the economy and creating jobs. Since July 1992 the Bank provided 33 loans to Kazakhstan, totaling more than $4.2 billion.

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