Armenia: Urban Development in Secondary Cities

Sovereign Project | 45415-001

Summary

The Government of Armenia requested the Asian Development Bank (ADB) to provide policy and advisory technical assistance (TA) to prepare city development/investment plans (CDPs) in the four secondary cities: Gyumri, Vanadzor, Dilijan, and Jermuk. The government and ADB approved the Sustainable Urban Development Investment Program in 2011 to finance priority infrastructure projects in urban areas of Armenia for a total amount of $400 million equivalent. The first tranche for $50 million will finance projects in Yerevan. The subsequent tranches to be approved in 2013 and onward will mainly focus on secondary cities. The CDPs will focus on key development and policy challenges related to urban sectors including urban transport, water supply and sanitation, solid waste management, district heating, housing, economic development, logistics, tourism, and lighting.

Latest Project Documents

Title Document Date
Urban Development in Secondary Cities Apr 2013

Consulting Notices

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Procurement Notices

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Procurement Documents

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Project Name Urban Development in Secondary Cities
Project Number 45415-001
Country Armenia
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8361-ARM: Urban Development in Secondary Cities
Urban Environmental Infrastructure Fund-UFPF Multi US$ 660,000.00
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Partnerships
Private sector development
Sector / Subsector

Energy - Energy utility services

Industry and trade - Trade and services

Information and communication technology - ICT industries and ICT-enabled services

Transport - Transport policies and institutional development - Urban public transport

Water and other urban infrastructure and services - Other urban services - Urban policy, institutional and capacity development - Urban slum development - Urban solid waste management

Gender Equity and Mainstreaming
Description

The Government of Armenia requested the Asian Development Bank (ADB) to provide policy and advisory technical assistance (TA) to prepare city development/investment plans (CDPs) in the four secondary cities: Gyumri, Vanadzor, Dilijan, and Jermuk. The government and ADB approved the Sustainable Urban Development Investment Program in 2011 to finance priority infrastructure projects in urban areas of Armenia for a total amount of $400 million equivalent. The first tranche for $50 million will finance projects in Yerevan. The subsequent tranches to be approved in 2013 and onward will mainly focus on secondary cities. The CDPs will focus on key development and policy challenges related to urban sectors including urban transport, water supply and sanitation, solid waste management, district heating, housing, economic development, logistics, tourism, and lighting. The CDPs will span a 10-year period and will specify and prioritize a list of urban investment projects and improvements in the selected cities within the city development/investment plan.

ADB agreed with the government on the objectives and scope of the TA, the terms of reference for the consultants, and the cost and implementation arrangements.

Project Rationale and Linkage to Country/Regional Strategy

Being a landlocked country, Armenia's economic development is tied to the construction of transborder infrastructure linking its economy to export markets and to strengthening economic poles able to generate positive spin-offs for its surrounding territory. Unbalanced economic growth among regions poses serious development challenges to planners and policy makers in Armenia. Some cities are growing fast; others are not. Some house only one industry at best while others struggle to attract one. A gradual collapse of its heavy industry in the early 1990s created a rapid shift in the location of commercial and residential centers throughout the country and corresponding changes in the demand for urban and transport network services. These changes have led to poor urban services management, traffic, congestion, loss of green areas, poor air quality, noise, and degraded historical buildings in many cities.

As urban areas are the pillars of Armenia's economic growth and home to 2.1 million people (64% of the total country population), the government's objective is to offer balanced and sustainable economic and territorial development that will (i) boost economic growth and job creation, (ii) stimulate private sector investment, and (iii) rebalance development between Yerevan and participating cities. These cities generate almost 90% of the nation's gross domestic product and represent three-quarters of the urban population. The government's strategic orientation revolves around the north-south corridor and focuses on:

(i) bolstering Yerevan as the country's engine of growth and improving connection to the neighboring countries, with infrastructure designed according to international

standards (British Standard, Deutsche Normen, American Society for Testing and Material);

(ii) establishing Gyumri, Vanadzor, and Kapan as the three main trade gateways of Armenia by strengthening the economic and social clusters already identified to offer

alternative centers of growth;

(iii) strengthening the agribusiness cluster of the four medium cities of Astashat, Ararat, Ashtarat, and Armavir; and

(iv) improving accessibility and accelerating development of the four cities of Jermuk, Dilijan, Tsakhkadzor, and Sevan, which have high tourism development potential

Institutional arrangements and strategic planning have been addressed in the water supply sector, and the expertise of the private sector was tapped, but there is still a lot to do in transport and waste management.

The quality of urban services in Armenia is low, mainly because of poor performance of the existing services, lack of strategic or integrated planning, and weak enforcement of the law. The financial sustainability of services is therefore ineffective, implying high operating costs and higher tariffs.

Ongoing infrastructure development and development partner assistance is important in Armenia, with 10 projects being financed from development partners like the World Bank, the European Bank for Reconstruction and Development, and KfW, mainly in transport and water, for a total value of about $230 million, excluding those projects financed by ADB.

Impact Improved urban and municipal infrastructures in Gyumri, Jermuk, Vanadzor and Dilijan
Project Outcome
Description of Outcome Well planned urban development investment projects in Gyumri, Jermuk, Vaqnadzor, and Dilijan
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

Diagnostics reports for reference in preparing the city development/ investment plans completed

A 10-year city strategic vision, city development/ investment plan based on each city's financial situation endorsed

An exhibition on CDPs for Gyumri, Jermuk, Vanadzor, and Dilijan conducted

Prioritized project list for the four secondary cities completed

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Armenia/Vanadzor/Lori,Armenia/Gyumri/Shirak,Armenia/Dilijan/Tavush,Armenia/Jermuk/Jermuk
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design Consultations with stakeholders were held during project processing.
During Project Implementation Meetings with stakeholders will be held during project implementation.
Business Opportunities
Consulting Services Two types of consultants will be recruited under the TA: a group of individual consultants, and one local communication and marketing agency. The team of individual consultants will comprise seven international individual consultants supported by three national consultants. They will be recruited through ADB's Consultant Management System and will cover the following expertise: urban planning, urban infrastructure, urban financing, institutional, economic development, economic analysis, tourism, and cultural heritage development. They will prioritize a project list in the four secondary cities. Consultants will be recruited in line with ADB's Guidelines on the Use of Consultants (2010, as amended from time to time).
Procurement Procurement financed under the technical assistance will be done according to ADB Procurement Guidelines.
Responsible ADB Officer Cesar Llorens
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Urban Development and Water Division, CWRD
Executing Agencies
Ministry of Territorial Admin&Emergency SituationsVache B. Terteryan, First Deputy Ministerv.terteryan@mta.gov.amGovernment Building 2, Republic Square, Yerevan 0010 Armenia
Timetable
Concept Clearance 05 Dec 2012
Fact Finding 28 Jul 2012 to 04 Aug 2012
MRM -
Approval 29 Apr 2013
Last Review Mission -
Last PDS Update 09 Mar 2015

TA 8361-ARM

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
29 Apr 2013 03 Jul 2013 03 Jul 2013 30 Sep 2015 30 Dec 2015 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
0.00 660,000.00 0.00 0.00 0.00 0.00 660,000.00 29 Apr 2013 474,576.84
Title Document Type Document Date
Urban Development in Secondary Cities Technical Assistance Reports Apr 2013

Safeguard Documents

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Evaluation Documents

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