ADB plans to invest in creation of new generation border crossing points in Azerbaijan

The Asian Development Bank (ADB) has approved technical assistance totaling $1 million under the "New Generation Border Crossing Points for CAREC Countries" project, Report informs.

The project involves Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Mongolia, Pakistan, China, Tajikistan, Turkmenistan, and Uzbekistan. Financing will be provided from the ADB Technical Assistance Special Fund.

The technical assistance (TA) will support ADB and DMCs with the special focus on CAREC countries in developing border crossing points (BCPs) with climate and innovation focus. The TA will utilize CAREC as a platform to support processing of BCP projects under the BUILD facility, which will finance a series of individual small-value BCP projects along the CAREC corridors.

The TA will support: preparation of at least three priority BCP projects in CAREC region including scoping, feasibility studies and due diligence; conceptualization of a new preparation and implementation approach of the candidate BCP projects of CAREC countries to be processed under the BUILD facility; and capacity building initiatives for CAREC countries in BCP development and operations.

ADB has been monitoring time and cost of road and rail freight along the CAREC corridors through corridor performance measurement and monitoring (CPMM) annually since 2010.

As demonstrated by the CPMM, BCPs in CAREC region remain major bottlenecks for cross-border transport and logistics. The following issues reduce the efficiency of the CAREC transport network and increase trade costs: lack of institutional coordination among national transport agencies and BMAs in most CAREC countries and between BMAs and neighboring countries; outdated infrastructure and equipment; permanent or temporary closures of BCPs; inefficient and duplicative customs, immigration, security, sanitary, and phytosanitary control procedures; and lack of private sector investment in providing additional financing.

ADB has financed or analyzed several individual BCP projects with significant results. However, improvement of each individual BCP is operationally inefficient considering their relatively small size and remote locations, the need to study and produce similar documentation for each project, recruiting different consulting firms for each project to perform similar activities, and identical transaction costs and project preparation timelines despite the smaller financing amounts.

The TA, together with the BUILD facility, will streamline ADB's internal procedures by enhancing its ability to process small-value projects in the CAREC region faster and with lower transaction costs.

Azerbaijan has been a member of ADB since 1999. During this period, the bank has invested over $5 billion in the country through 145 projects, including $4 billion in the public sector and $1 billion in the private sector. The largest financing areas are transport ($1.5 billion) and energy ($1.7 billion).

As part of the new partnership strategy, ADB is prepared to invest up to $2.5 billion in Azerbaijan.

ADB was established in 1966 and is headquartered in Manila. The bank unites 69 shareholder countries, 50 of which are countries in the Asia-Pacific region.