On December 11, the Armenian government approved a draft law ratifying the loan agreement 'Armenia Water Supply and Irrigation Services Enhancement Project: Phase 1' (WISE) between the Republic of Armenia and the International Bank for Reconstruction and Development (IBRD - the main lending arm of the World Bank Group).
As stated in the explanatory note to the document, the Republic of Armenia and the International Bank for Reconstruction and Development (IBRD) signed the corresponding loan agreement on September 11 and 18, 2025.
According to the Agreement, the Bank will provide the Republic of Armenia with ?70.4 million to finance the Project, and the Government of the Republic of Armenia will co-finance taxes, duties, operating expenses related to the Project, and other costs not eligible for financing by the loan.
The Loan Agreement is valid for 180 days from the date of its signing, and the Project is valid for five years from the effective date. The effective date of the Co-financing Agreement is March 31, 2026.
The Project consists of the following main components: water sector reform and institutional strengthening for climate-resilient irrigation, rural water supply, and sanitation systems; improvement of rural water supply and sanitation; modernization of irrigation infrastructure and system management; and project management.
The project is also expected to be co-financed by the French Development Agency (Agence Francaise de Developpement).
It is noted that given the multifaceted and interconnected nature of the challenges facing the water sector in Armenia, including aging irrigation infrastructure, limited access to safe water for the rural population, and growing risks associated with climate change, the proposed WISE project aims to apply an integrated, multi-phase approach to ensure sustainable development and effective management of the sector. The project is a logical continuation of previous World Bank-financed initiatives and will ensure the implementation of necessary policy, institutional, and infrastructure reforms.
The project is expected to result in the introduction of climate-resilient irrigation and water supply systems, which will contribute to economic growth, food security, and balanced regional development.
In June, ArmInfo reported that the World Bank's Board of Directors approved the first phase of a large- scale $435 million program aimed at improving water supply and irrigation systems in rural and underserved areas of Armenia. The program, scheduled for 2025-2031, will be financed by a loan from the International Bank for Reconstruction and Development (IBRD) equivalent to $80 million. Co-financing will come from the French Development Agency (AfD), the EU, and the Armenian government, totaling $185 million. Over the next 10 years, the total funding will amount to $435 million, the lion's share ($330 million) of which will come from the IBRD.
"The program envisages comprehensive reforms of water resources management enterprises. It encompasses the modernization of irrigation systems and the expansion of reliable water supply in selected rural communities," noted Caroline Guegenat, head of the WB Yerevan office. According to her, infrastructure investments, coupled with governance and policy reforms, will help Armenia address challenges such as droughts, floods, and extreme heat. Overall, the program will improve the quality of life and economic resilience of rural communities.
The first six-year phase of the program will be implemented by the Water Committee of the Ministry of Territorial Administration and Infrastructure of the Republic of Armenia in settlements in the Ararat, Armavir, Kotayk, Aragatsotn, Shirak, and Tavush regions. The initiative aims to modernize infrastructure and strengthen institutions regulating the water sector, in line with Armenia's commitments to reduce greenhouse gas emissions and improve adaptation to extreme weather events. According to the source, approximately 650,000 people in 579 rural settlements in Armenia remain without access to centralized water services because they live in areas not covered by lease agreements for water supply.
It was noted that the World Bank remains committed to supporting Armenia's development, fighting poverty, and creating a more sustainable and prosperous future. Since 1992, the World Bank has provided approximately $3 billion to the country, including investment loans, grants, analytical support, and technical assistance. The current portfolio of the IBRD, trust funds, and the International Development Association (IDA, a World Bank entity) is approximately $400 million. Armenia also became an IDA donor country in 2023.
Source:finport.am
October 28, 2025 Armenia's 2026 budget earmarks 48.4 billion drams for construction of Armenia-Georgia power transmission line
Armenian government's draft budget for 2026 has earmakred 48.4 billion drams for the ongoing construction of the Armenia-Georgia overhead power transmission line (OPT) and associated infrastructure, Minister of Territorial Administration and Infrastructure, David Khudatyan, revealed during the budget discussions in parliament.
Khudatyan remarked that the tender process for this project was nearing its final stages.
He further mentioned that the reconstruction efforts for the Shahumyan-2, Marash, and Yeghegnadzor substations will also progress next year, with an allocation of 3.8 billion drams designated for this purpose.
The Minister also revealed that a total of 13.9 billion drams are earmarked for the continuation of the energy efficiency program, with 7.9 billion drams specifically allocated for the energy efficiency initiative in Yerevan.
Source:arka.am
September 24, 2025 Armenia to employ effective landfill monitoring systems, according to Deputy Minister
Armenia aims to introduce efficient landfill monitoring mechanisms to assess their impact on the environment and public health, according to Deputy Minister of Environment Ara Mkrtchyan, who presented a series of related amendments to the Law on Waste and the Code of Administrative Offenses to parliament today.
"This proposed legislation addresses monitoring issues to assess the effects of landfill fires or the accumulation of substantial waste on individuals," remarked Mkrtchyan.
He underscored the importance of identifying specific individuals responsible for monitoring. The amendments provide clarity on the definitions of "landfill," "waste owner," "waste accumulation," and the principles of effective waste management.
Furthermore, the legislative proposal outlines requirements for the management and licensing of hazardous waste activities and specifies the authorities of the government and the designated body. It will also establish rules and requirements for waste tracking and utilization, along with the submission of statistical reports regarding hazardous waste.
The deputy minister noted that the approval of these amendments would aid in preventing the operation of unauthorized landfills, ensuring that landfill managers comply more closely with proper operational standards.
The bill has received a positive evaluation from the relevant parliamentary committee. Previously, Yerevan Mayor Tigran Avinyan insisted that a tender for the construction of a waste processing facility be organized and completed by the end of the year, threatening personnel actions if this was not accomplished.
The construction of a waste processing plant in Yerevan has been a recurring subject of discussion, especially in light of frequent fires at the Nubarashen landfill, which have caused smoke and fumes to permeate the city.
Source:arka.am
September 11, 2025 EIB puts forward initiative to specify some provisions of agreement on financing of construction of Sisian- Kajaran section under North-South program
The European Investment Bank (EIB) has proposed amending the financial agreement with Armenia in the amount of 236 million euros within the framework of the program Armenia. Sisian-Kajaran Road Section Project European Fund for Sustainable Development + Special Investment Window 1. Draft letter No. 1 on amending the document was approved by the Armenian Cabinet of Ministers on September 11.
The proposal to sign a financial agreement with the European Investment Bank (EIB) in the amount of 236 million euros within the framework of this program was approved by the Government of the Republic of Armenia on November 7, 2024, and signed on November 12, 2024.
Earlier, ArmInfo reported that in 2025, it is planned to begin construction work on a new section of the road with a length of about 60 km Sisian-Kajaran (including the Bargushat tunnel) of the 4th tranche of the North-South highway corridor. The work will be carried out in three subsections: the northern section - 27.12 km long; the Bargushat tunnel section, 8.65 km long and the southern section, 24.25 km long. In total, as noted in May 2024 by the Ministry of Territorial Administration and Infrastructure, 708 million euros of loan funds will be required for the construction of the three subsections of the road section.
The current financing agreement provides for co-financing the construction of the northern section with a length of 27.1 km and the southern section with a length of 24.25 km of the new section of the North-South Sisian-Kajaran road with a length of about 60 km. The construction of road sections will reduce the length of the Sisian-Kajaran section, which will lead to a reduction in travel time, an increase in the average speed of vehicles from the current 50 km/h (to 100 km/h), and an increase in traffic comfort and safety. The construction of road sections will also contribute to an increase in trade turnover, a reduction in transport costs and the development of tourism.
Road construction works on the northern and southern sections include: the construction of a 3-lane road with asphalt concrete pavement, 8 tunnels, 27 bridges, 3 transport hubs, 151 culverts, 71 retaining walls (6.3 km), and other works to ensure safe traffic.
This financial agreement was ratified on June 12, 2025 and, according to the notification received from the EIB, entered into force on August 27, 2025. The EIB has now submitted draft letter No. 1 on amendments to the document.
The draft proposes to make a number of editorial changes (concerning the fight against money laundering of real beneficiaries, prepayment mechanisms, conflicts of interest, etc.).
"The draft does not constitute an agreement, amendment or waiver of any provision or condition of the Financing Agreement. The proposed amendments are due to the need to clarify certain provisions of the Financing Agreement," the document says.
Source:finport.am
May 26, 2025 Armenia to receive loan and grant funds from KfW for expansion of renewables and energy efficiency
On June 26, the regular session of the Cabinet of Ministers of Armenia was held on the expediency of ratifying the Agreement.
As stated in the explanatory note to the document, the agreement was signed on March 31, 2025. The document outlines the legal framework, that will serve as the basis for separate agreements on financing, lending and cooperation between the parties. The agreement includes a loan of up to 26,000,000 euros from KfW for the program , as well as a grant of up to 2,000,000 euros for ancillary activities necessary for the implementation and consulting of the above-mentioned project.
The Government of the Republic of Armenia will exempt KfW from direct taxes payable in Armenia related to the conclusion and implementation of the projects or the loan agreements concluded within their framework. This agreement is a framework agreement, under which sign separate financing agreements or loan agreements for the above-mentioned programs will be signed in the future.
Source:finport.am
April 9, 2025 Construction of largest solar power plant in Armenia jointly with Emirati company MASDAR will start in early 2026
Armenia and the UAE have agreed to begin the construction of the industrial-scale photovoltaic solar power plant "Ayg-1" in Armenia in early 2026.
The construction of the power plant was discussed by Armenian Minister of Economy Gevorg Papoyan with CEO of MASDAR, Mohammed Jamil Al-Ramahi, during a working visit to the UAE. A roadmap for the upcoming work was approved, as reported by the press service of the Armenian Ministry of Economy.
Both parties highly praised the results of the negotiations and agreed to continue their cooperation.
An agreement with the Emirati company MASDAR for the design, financing, construction, and operation of the plant was signed in November 2021. The solar power plant, with an installed capacity of 200 MW, will occupy an area of 500 hectares in the Talin and Dashtadem communities of the Aragatsotn region of Armenia. The total investment cost for the project is estimated at $174 million.
It was initially planned that 15% of the solar power plant would belong to the Armenian ANIF fund (the fund, which was established by the state in 2019 to attract foreign investment in partnership with the private sector, was liquidated in August 2024. Financial problems, particularly in the accounting documentation, were identified in the fund - ed.).
MASDAR, a company registered in the UAE, is a subsidiary of the UAE’s sovereign wealth fund, Mubadala Investment Company.
Source:arka.am
January 22, 2025 WB to provide $40mln loan to Armenia for reconstruction of three power substations
The World Bank, through the International Bank for Reconstruction and Development, will provide Armenia with a $40 million loan to support the Enabling the Energy Transition project, which will facilitate the implementation of the country's Energy Sector Development Strategy until 2040. The National Assembly of the Republic of Armenia is discussing the draft agreement with the IBRD, submitted for ratification by the Government of the Republic of Armenia, at a plenary session on January 22.
As Deputy Minister of Territorial Administration and Infrastructure of the Republic of Armenia Kristine Galechyan noted in her speech, the agreement was signed on August 6 and 8, 2024.
The credit resources will be used to modernize the Shahumyan-2, Marash and Yeghegnadzor substations, which are on the balance sheet of High-Voltage Power Transmission Lines of Armenia CJSC.
The Shahumyan-2 substation, built in 1964, has a capacity of 250 MW. The Marash substation, commissioned in 1978, has a capacity of 375 MW.
The Yeghegnadzor substation, with a capacity of 126 MVA, was built in 1966. The equipment at these substations has been in operation for over 40 years and there is an urgent need for its modernization.
In particular, it is planned to upgrade relay protection to modern microprocessor relays, as well as to carry out restoration and construction work on reinforced concrete structures, trenches and earthen supports.
The deputy minister also reported that the credit funds are provided for a period of 25 years, 15 of which are on preferential terms. She noted that Armenia had previously attracted loans from the Asian Development Bank and KfW Bank for the implementation of similar programs.
Source:finport.am
January16, 2025 Armenia to get EUR 66mln loan, EUR 3mln from Germany for renewable energy development
On January 16, the Government of Armenia approved a proposal to sign a financial cooperation agreement with the Government of the Federal Republic of Germany for 2023.
As stated in the explanatory note to the document, the agreement provides the relevant legal framework that serves as the basis for concluding separate financing or loan agreements and cooperation between the parties.
The agreement provides for a loan of up to 26,000,000 euros from KFW (German Development Bank) under the program and a grant of up to 2,000,000 euros for related activities necessary for the implementation and consulting of the above- mentioned project.
In addition, the German government provides the Armenian government or other borrowers, which will be jointly selected by the two governments, with the opportunity to receive a preferential loan of up to EUR 40,000,000 under the program , which is provided through KFW within the framework of the Community Development Cooperation, as well as a grant of up to EUR 1,000,000 for related activities necessary for the implementation of the above- mentioned project and consulting services.
It is noted that the Government of the Republic of Armenia exempts KFW from direct taxes payable in the Republic of Armenia in connection with the conclusion and implementation of the programs.
The agreement is a framework agreement, within the framework of which it is planned to sign separate agreements on financing or lending for the above-mentioned programs in the future.
Source:finport.am
January 9, 2025 EIB to grant EUR 10.1mln to Armenia for energy efficiency programme in Yerevan
Armenia will receive grant funds from the European Investment Bank (EIB) for the implementation of the second energy efficiency program in Yerevan. On January 9, the government approved the draft on ratification of the relevant agreement with the EIB on an investment grant.
As stated in the explanatory note to the document, the document was signed on November 12, 2024. The goal of the project is to reduce the energy consumption of buildings and support energy efficiency and renewable energy measures, which will include the necessary work to improve the general technical condition of clinics and kindergartens.
The total cost of the project is 38 million euros, which will be financed from the following sources: EIB loan funds - 25 million euros, grant funds from the EU Neighborhood Investment Program - 10.1 million euros, technical support from the European Union Neighborhood Investment Program - 650,000 euros, other expenses under the European Union Neighborhood Investment Program - 250,000 euros. The Yerevan Municipality's own funds will amount to 2 million euros.
As a result, the capital's administration hopes to reduce energy costs, increase seismic safety, improve the comfort and quality of life of tourists, reduce CO2 emissions and extend the service life of renovated buildings.
In general, as a result of the Project's implementation, it will be possible to reduce the energy consumption of about 38 public buildings (6 clinics and 32 kindergartens) by about 65%.
<At the same time, the draft investment grant agreement <The Second Yerevan Energy Efficiency Program> between the Republic of Armenia and the European Investment Bank does not contain provisions providing for financial obligations for the Republic of Armenia>, the document says.
Source:finport.am
January 9, 2025 Sisian-Kajaran section of North-South project planned to be completed by end of 2031
On January 9, at its regular session, the Armenian government approved the draft law on ratification of the financial agreement between the Republic of Armenia and the European Investment Bank <Armenia. Sisian-Kajaran Road Section Program> <European Fund for Sustainable Development + Special Investment Window 1> with a budget of 236 million euros.
ArmInfo reported earlier that in 2025, it is planned to begin construction work on a new road section with a length of about 60 km Sisian-Kajaran (including the Bargushat tunnel) of the 4th tranche of the North- South road corridor.
The works will be carried out in three sections: the northern section - 27.12 km long; the Bargushat tunnel section, 8.65 km long, and the southern section, 24.25 km long. In total, as noted in May 2024 by the Ministry of Territorial Administration and Infrastructure, the construction of the three sections of the road section will require 708 million euros in credit funds. The southern section was planned to be implemented with joint financing from the EBRD and the European Investment Bank (EIB). According to the initial plan presented by the EBRD, the necessary credit funds to finance the southern section amount to 373 million euros, of which 236 million euros are planned to be attracted from the EBRD, and the remaining 137 million euros the RA authorities wanted to borrow from the EIB. As stated in the explanation to today's document, within the framework of the program, an asphalt concrete road with a width of 11.1 m (including reinforced shoulders), 3 traffic lanes (3.30 m), 27 bridges with a length of 4.7 km and 9 tunnels with a total length of 12.5 km will be built, the longest of which is the Bargushat tunnel with a length of 8.6 km (the tunnel section will be financed separately).
The funds provided by the document will be used to finance the construction of the northern and southern sections of the Sisian-Kajaran road. The project will also be co-financed by the European Bank for Reconstruction and Development and the Asian Development Bank, each in the amount of 236 million euros.
The contract also sets out requirements for mitigating environmental and social impacts, the effects of climate change, as well as measures to ensure road safety in accordance with EU directives.
The project is scheduled for completion by December 2033 (completion of construction: December 2031, quality guarantee period: December 2033).
The amount of the loan provided is 236 million euros. The terms of the loan are as follows: the term of use of funds is 5 years after the entry into force of the agreement; the funds will be provided in several tranches (maximum 20 tranches, not less than 5 million euros each); the interest rate - fixed or floating - is set separately for each tranche based on the Borrower's application.
The floating interest rate is equal to the 6-month EURIBOR rate plus a fixed margin (the margin is fixed by the Bank in the installment offer). Loan servicing payments (interest and principal repayment) will be made semi-annually, on March 20 and September 20 of each year; repayment period - each tranche will have its own repayment schedule based on the Borrower's application. The loan repayment period may be 4-30 years, and the grace period - from 1 month to 5 years.
<North-South> is one of the largest projects in the history of independent Armenia. This road will reduce the distance from the Iranian border to the Georgian border from 556 to 490 kilometers. The road will significantly facilitate access to the Black Sea not only for Armenia, but also for Iran. As of May 2024, the investment program has been implemented by 10%, and the amount of loans attracted as of the end of May 2024 amounted to $800.7 million.
Source:finport.am
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