BAKU

The World Bank will disburse a $65 million loan to Azerbaijan to finance the regional connectivity and development project that is aimed at providing safe, efficient and climate-resilient transport connectivity and improving market accessibility in the country’s southern region, the country’s Finance Ministry said.

The funds will be used to rebuild the Yenikend-Bilasuvar road, which is an alternative road to the Alat-Astara-the state border with Iran, to create a roadside logistics and market infrastructure management model in Azerbaijan, and for other technical purposes.

The 11-year loan will be allocated by the International Bank for Reconstruction and Development, the World Bank’s lending arm, with a four-year grace period.

The bank said that about 250,000 people living along the Yenikend-Bilasuvar road would benefit from upgraded road infrastructure, as well as improved economic opportunities and easier access to essential service facilities.

Investments in roads and ancillary agricultural and logistics infrastructure will contribute to supporting connectivity and market accessibility, with a view to maximising the socio-economic development impact of upgraded roads.

The project will also support financial sustainability and efficiency within the road sector, through technical assistance for developing road network management systems and study options for the introduction of user charges and the prevention of vehicle overloading.

In addition, the project will support the design and arrangement of roadside logistics and market facilities, and the provision of skills training to local entrepreneurs, to improve income-generating opportunities for local communities. The project will support aspects such as raised road embankments and the use of appropriate road materials to address climate vulnerabilities.

Agriculture is the primary economic sector in Azerbaijan’s southern region where the project is being implemented. Improving the capacity of local markets is crucial for the economic development and livelihoods of local farmers. By improving road connectivity, with climate-resilient measures, the project is expected to reduce transportation costs and time, as well as road disruption risks, for agriculture supply chains and logistics.

Azerbaijan joined the World Bank in 1992. Since then, the World Bank has financed over 50 projects with total commitments of $4.4 billion.