Washington, March 28, 2016 - The World Bank Board of Directors today approved a US$ 140 million Loan to the Republic of Azerbaijan for the Additional Financing for the Third Highway Project. The Additional Financing will help complete upgrading of the Baku – Shamakhi road sections by expanding them from two to four lanes, and will support strengthening Azerbaijan’s nascent motorway management and maintenance program.
The Project will help provide better transport services in mountainous central and northern regions of Azerbaijan, which have considerable potential for tourism and industrial production. This section of the road also constitutes part of the shortest route to the Georgian border, and connects metropolitan Baku area with major agricultural producers in the west of Azerbaijan. In addition to upgrading the Baku – Shamakhi road, the project will help the government develop a modern management framework for the motorway network, which includes contractual maintenance mechanisms and performance-based benchmarks.
"This Additional Financing will help complete improvement of the Baku – Shamakhi road to make it safer and more efficient for the users”, said Nijat Valiyev, leader of the World Bank team that prepared the project. “We’re pleased that the project now has a major component to modernize Azerbaijan’s road management and maintenance practices by putting in place necessary institutions, human resources and technology”.
Roads are the dominant transport mode in Azerbaijan accounting for 60 percent of freight and 90 percent of passenger transportation. This additional financing builds on the World Bank’s successful experience in the road sector in Azerbaijan which helped the country to connect with regional markets, and contributed to Azerbaijan’s diversification agenda.
“This project contributes to one of the building blocks of Azerbaijan’s development program, namely connecting people, enterprises, markets and services”, said Larisa Leshchenko, World Bank Country Manager for Azerbaijan. “We expect that this project will foster economic activity and tourism in this important region of Azerbaijan”.
The Third Highway Project has three components:
Motorway Improvement component will support completion of the upgrade of the Baku-Shamakhi road to the Category 1 motorway standards by expanding existing two-lane sections to four lanes, and some additional works under ongoing contracts. The Component will also finance technical supervision of civil works.
Institutional Development and Support for Motorway Maintenance Reform component includes technical assistance for establishment and capacity building of Motorways Management Unit and Regional Motorway Maintenance Units, including provision of training, essential equipment, offices and depots for these newly established units.
Project Management and Institutional Support component will finance costs related to project implementation, updating road database, conducting road user satisfaction survey, project audits and project monitoring and evaluation.
Azerbaijan joined the World Bank in 1992. Since then, commitments to the country totaled over US$ 3 billion for 55 projects.