German Reconstruction Bank (KFW) agreed with all conditions of the agreement Azeri government suggested under the project of reconstruction of water networks in Ganja and Sheki. Officials of the Cabinet of Ministers told Trend that the conclusion will be issued to the government upon approval by State Secretariat of Economic Relations of Switzerland (SECO).
Their essence is in simplification of credit terms and KFW agreed to delete schedules of water fee increase and payments for water usage. Consequently, SECO wishes to check the reasons for refusal from preliminary conditions.
In this connection, signing credit agreements under the project is not expected. Officials of Ministers Cabinet suggest this to happen in fall 2006. The question of raising governmental share in the project to E8.250mln is still in the air. Officials of the Ministry of Finance say these additional funds are purposed for recovery and maintenance of water networks in Ganja and Sheki areas. The project includes improvement of water supply for only 53% of these areas.
Cost of Phase 2 of the project scheduled for 3.5 to 4 years is approved to be E 54mln, from which E 37mln (E 25.85mln of new credit and remainder of similar operations under Phase 1 in Imishli) are issued by KfW, E 10mln by SECO and E 7mln at the cost of Azeri government share unless it is raised to E 8.250mln.