Azerbaijan, Baku, 31 July / Trend, I. Khalilova /
The Asian Development Bank (ADB) may suspend financing for the first section of the Masalli-Astara highway, if construction works are not completed by the end of 2013.
As the bank's Baku office told Trend on Wednesday, reconstruction is lagging behind schedule.
"The bank is very dissatisfied with the pace of the road's construction, and several meetings have been held with contractors on the matter; but unfortunately, this is yielding no results. Due to the lack of progress, a credit extension is out of the question," the bank said.
Previously, due to delays in the selection of a contractor and the start of construction work at the site, the loan was extended for three years until the end of 2013. The bank did not approve another re-extension, although it could be considered if there was progress in construction, the bank said.
"A decision will be made in September on the future of the loan, and given that there is a high risk that the contractor will not complete work on time, financing may be suspended before the end of the year," ADB said.
Construction company 'Azerinshaatservis Bank' was selected to build the road's first section (A) with a loan of $200 million provided by the ADB. Up to 50 percent of the loan has been used to date.
The ADB also hopes that construction work on two other sections of the Masalli-Astara highway will begin by the end of 2013. According to the source, the contractor for construction of the road's B section has already started work, while the tender procedure to select a contractor for the third section (C) has not yet been completed.
Completion of these two areas is expected by 2016 thanks to a two year extension of credits granted in response to delays over involvement of construction contractors.
Section B stretches from the 22.15-kilometer mark to the 41.5 kilometer mark of the road. The contractor will build a two-lane road at a length of 19.35 kilometers, ten bridges, two intersections and transitions, four recreation areas and a drainage system.
The 19.9-kilometer-long section C covers the distance from the 41.5 kilometer mark to the 61.4 kilometer mark of the Masalli-Astara road. In addition to the roadway, two transitions, eight bridges, four recreation areas, drainage systems and other devices will be built.
Financing will be conducted at the expense of the first program of the Multi-Tranche Financing Facility (MFF) as agreed upon in an agreement signed July 27, 2012 in Baku on the allocation of the third tranche of $ 200 million for the road network. In total, the road will cost $500 million.