Rail Trade and Transport Facilitation AF

Summary

The main project objective is to improve railway services in Azerbaijan, as well as the competitiveness, financial sustainability, operating and cost efficiency, and capacity of ADDY in particular along the transport corridor toward Georgia (east-west corridor).

Expected Outcome

The project will focus on: (i) maintaining and growing the railway business (increase revenue from US$219 million today to about US$283 million by 2015) by providing the profitable freight market segment with proper service, infrastructure and locomotive capacity; (ii) transforming the Azeri Railways into a financially self-sustainable operation in freight transportation, covering all its costs (including infrastructure maintenance and traction) from revenues, while improving its operational efficiency; and (iii) improving the transparency of the Railway sector by introducing International Financial Reporting Standards (IFRS) and profit centers (passenger/freight) and by separating on an accounting basis passenger service that could be self-sustained from others. Other parts of the Government Program are expected to be covered through separate projects once the proper financial and technical due diligence has been completed.

Expected Outputs