ADB prepares third loan for Azerbaijan

Business Materials 29 July 2011 16:18 (UTC +04:00)

Azerbaijan, Baku, July 28 / Trend I.Khalilova /

The Asian Development Bank (ADB) plans to complete the second tranche of $180 million in multitranche funding (MFF) to improve water and sanitation services in Azerbaijan in August-September.

Although consultations on this loan with the government were expected to be held in June, the preparation of the second tranche may start in August due to delays in determining a contractor for Goychay.

It may be financed within the MFF first tranche.

The ADB has financed two projects to improve water and sanitation services.

The first loan worth $30 million was allocated in 2004 to restore the water supply system in Goychay and Nakhchivan.

The project's initial cost hit $39.9 million. Funding for the project expires on June 30.

Under the loan agreement, the ADB's first tranche loan of $75 million is allocated. The Azerbaijani government is providing $25 million.

A list of regions in the project is expected to be expanded within the second tranche.

Agdash, Agjabadi, Beylagan and Balaken are planned to be added.

The contractor carrying out construction in Nakhchivan is Gemi Qaya.

The company was selected as the project's regional executor.

The decision was made by the State Committee for Land Reclamation and Water Management of the Nakhchivan Autonomous Republic.

Azersu issued a repeated tender for Goychay to determine contractor and tender procedures. These are expected to stop by July 25.

Under the proposed prices of the contracting companies, within the perimeters set by the tender announced by Azersu, the costs exceed 100 percent of the real price.

The ADB office said Azersu has closed the tender for Goychay. Company proposals are being assessed.

The loan is expected to be approved by the bank's board of directors by the end of the third quarter.