The European Bank for Reconstruction and Development (EBRD) and the United States Agency for International Development (USAID) have signed a Memorandum of Understanding (MoU) for the Middle Corridor development. The route is also known as the Trans-Caspian International Transport Route which starts from Southeast Asia and China, runs through Kazakhstan, the Caspian sea, Azerbaijan, Georgia and further to European countries.
The MoU was signed by EBRD Vice President, Banking, Matteo Patrone, and Erin Elizabeth McKee, Assistant Administrator in the Bureau for Europe and Eurasia at USAID, on the margins of the EBRD’s Annual Meeting and Business Forum taking place in Armenia.
The partnership will focus on expanding trade, green energy, investment in new industries, as well as transport and digital infrastructure in Armenia, Azerbaijan and Georgia.
Strengthening the Middle Corridor will create new, transformative economic opportunities across the region and provide an alternative transport route to existing commercial corridors.
The agreement seeks to enhance the planning, design and construction of critical energy, transport, digital and agricultural infrastructure in the region. It also aims to improve the efficiency of customs, tariff and border operations to attract private capital investment into the South Caucasus economies for the development of the Middle Corridor. The MoU aims at adopting the highest international standards to promote economic connectivity with Europe and among South Caucasus countries.
Other cooperation priorities focus on expanding investments in carbon-free energy opportunities and advancing policy and governance reforms to combat corruption and expand engagement with civil society.
Through the Middle Corridor development project, the two financial institutions will contribute to further enhance connectivity between Asia and Europe, via the South Caucasus.
Currently, the Trans-Caspian International Transport Route is used by 25 companied from 11 countries and the cargo volume is growing rapidly. In January 2024, during a working group, it was acknowledged the importance of Middle Corridor development to attract more freight volume. In 2023, the freight volume increased by 86% compared to 2022, and 2.7 million tonnes were transported.
According to the World Bank’s report ‘The Middle Trade and Transport Corridor: Policies and Investments to Triple Freight Volumes and Halve Travel Time by 2030’, the transport volume will triple reaching 11 million tonnes in 2030 along the corridor.
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