ARMENIAN RAILWAY PASSED FOR 30-YEAR CONCESSIONAL MANAGEMENT
12-10-2006 19:32:00 | Armenia | Economy
YEREVAN, OCTOBER 12, NOYAN TAPAN. At the October 12
sitting, the Armenian government made a decision to transfer
Armenian Railway CJSC for concessional management. The RA
Minister of Transport and Communication Andranik Manukian told
reporters following the sitting that the decision was made
taking into account the conclusion of a research done by the
advisor selected by the World Bank. Based on it, the railway
will not be fit for operation in three years, as it has not been
repaired over the past 16 years. Only a 70-km section has
undergone repair with WB credit resources.
According to A.Manukian, it is envisaged to complete the
transfer of Armenian Railway CJSC for concessional management in
18 months. The manager has to invest 170 million USD in the next
10 years in order to replace all lines, buy 1,200 new carriages
and install modern equipment at depots. The manager also has to
pay 10 mln USD for concessional management, 2% of revenues from
goods transportation and all taxes. The manager has the right to
extend the agreement for another 20 years 20 years after
assuming the management.
A. Manukian objected to the World Bank's proposal to stop
transportation of goods by the Armenian railway. He said that in
the future the RA Public Services Regulatory Commission will
decide tariffs of goods transportation.
The minister noted that since 2001, Armenian Railway has
operated at a profit. In 2003, the company's profit made 1.5 bln
drams (about 3.5 mln USD). At the same time, it was noted that
in the Soviet time, the annual volume of goods transportation by
railway made 25 mln tons, whereas in 2005, it made 2.2 mln tons.
In the minister's words, it is desirable that a big company
assume the management of Armenian Railway CJSC, for example,
Russian Railways that have an annual income of 25 bln USD.