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U.S.-funded construction of Armenia’s waterways proceeds

Five-year infrastructure program is at halfway mark

by Armen Hakobyan

Published: Friday February 06, 2009

A construction crew renovates the badly damaged Arzni-Shamiram canal. Armen Hakobyan for the Armenian Reporter

Yerevan - Winter is not an optimal time for construction. However, the seasonal slowdown in construction doesn't apply to Millennium Challenge Account-Armenia, which continues with a hectic work schedule. "For us 2009 is a very important year. Up until now we have been taking all the preparatory steps: studying the projects, designing them, checking everything. And now we have started the construction work full force. In 2010-11, according to the project, we must be entirely engaged in construction," chief executive officer Ara Hovsepian said in an interview with the Armenian Reporter.

Mr. Hovsepian noted that the U.S.-sponsored five-year project began its tenth trimester in January, which means it has reached its halfway mark. Even in difficult weather, then, the renovation and rehabilitation of a 4.2-kilometer section of the main Arzni-Shamiram water canal, which began on January 19, continues. (See story.)

"From January to March we are going to work on the main Arzni-Shamiram canal, plus, we are going to restore the engineering structures of the other canals," Mr. Hovsepian said.

The U.S. Millennium Challenge Corporation's compact with Armenia is conditional on Armenia's continued eligibility in three major categories, one of which is democratic governance. After Armenia's presidential election last February, and the suspension of civil liberties during a 20-day state of emergency in March, the corporation signaled that the program may be suspended or canceled.

In fact, the corporation in June halted funding for a major 273 kilometer roads work contract. The Armenian government responded by allocating $16.8 million of its own resources to proceed with the initial phase of the road program. But the corporation has continued to disburse funds for other parts of the Armenia compact. Thus, on December 12, 2008, MCA-Armenia requested approximately $6.8 million to cover its expenses for the first three months of 2009. The corporation in Washington has disbursed the funds.

"We are engaged in the technical implementation of the project and the technical implementation must be separated from the political activities, which are taking place in parallel," Mr. Hovsepian said. MCA-Armenia has "a set daily plan for five years, and we must clearly carry out our work. We have to implement what has been planned, independent of political processes." Only if there is a political decision to suspend or cancel the compact would the work be impacted, he said, adding that no such decision has been taken.

As for the road program, the Millennium Challenge Corporation indicated in a statement that it "hopes to see signs that the government of Armenia is committed to improving the performance criteria central to MCC eligibility. At the moment, the $16.8 million provided by the government of Armenia has not been fully exhausted."

Report Card

• The MCC funded the complete restoration of a 24.5-kilometer section of the Armavir-Isahakian-Gyumri road at a cost of $4.5 million. The project began in November, 2007 and the road was put into operation at the end of December 2008.
• Six kilometers of inter-community irrigation networks were renovated and restored in four communities in the Ararat and Armavir provinces at a cost of $300 thousand.
• As part of the "From Water to Market" project, 135 agricultural loans amounting to $1.5 million were disbursed. In the second phase of the project, which is to be launched shortly, $5.5 million in loans will be made. For the third phase, another $1.5 million in loans is planned. To date about 20,000 farmers have received training through the "From Water to Market" project.?f