Rehabilitation of Municipal Infrastructure 2, Ph. III

active

The project comprises the third phase of the overall Municipal Infrastructure Program II. While the previous project KIP I focused on the province of Armavir, KIP II (phases 1 and 2) previously included the provinces of Shirak and Lori. Phase 3 is now to include all of Armenia with the exception of the capital Yerevan. The measures in phase 3 are to complete the rehabilitation and construction work of previous programs/phases in the provincial capitals and surrounding communities in the area of water supply and to focus more on the rehabilitation and construction of wastewater disposal facilities. In addition, it is planned to build a sewage treatment plant for the first time as part of the measures. The borrower will be the Republic of Armenia, and the State Water Committee (WatCcom) will be the project sponsor from 2017. The total cost of the project amounts to around EUR 73 million. The investment costs amount to around EUR 67.5 million, of which EUR 30 million will be financed from a FC development loan as part of co-financing under the Mutual Re-liance Initiative and EUR 25.5 million (reduced to EUR 16.65 million in 2021) from the European Investment Bank (EIB). A further EUR 12 million will be provided as an investment grant by the EU - Neighbourhood Investment Facility (EU-NIF). The Armenian side will bear any taxes and other public charges that arise in the course of implementing the project. In addition, EUR 100 million was allocated as part of an accompanying measure. EUR 5.5 million (FZ accompanying measure of EUR 2.5 million and EU-NIF funds of EUR 3 million) financed the management contracts of the water supply companies until 2016 in order to give the Armenian government time to develop an orderly sector strategy with regard to the desired private sector participation. There is also an accompanying measure of EUR 3 million to support the State Water Committee SCWE in the area of strengthening the operators.