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Document of
 
The World Bank 
 
Report No:  59125-AM 
 
RESTRUCTURING PAPER 
 
ON A 
 
PROPOSED PROJECT RESTRUCTURING  
 
OF  
 
ADDITIONAL FINANCING FOR MUNICIPAL WATER AND WASTEWATER PROJECT 
 
CREDIT (4514-AM) 
 
BOARD APPROVAL: MAY 4, 2004 
 
TO THE 
 
REPUBLIC OF ARMENIA 
 
January 24, 2011
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ABBREVIATIONS AND ACRONYMS 
 
AWSC 
Armenia Water and Sewerage Company 
IDA 
International Development Association 
ISDS 
Integrated Safeguard Datasheet 
SCWE 
State Committee of Water Economy 
 
Regional Vice President:
Philippe H. Le Houerou (ECAVP) 
Country Director:
Asad Alam (ECCU3) 
Sector Manager:
Sector Director:
Wael Zakout (ECSS6) 
Peter Thomson (ECSSD) 
Task Team Leader:
Ahmed A. R. Eiweida (ECSSD) 
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Restructuring 
Restructuring Type: Level two 
Last modified on date : 01/21/2011 
1.  Basic Information 
Project ID & Name 
P063398: MUN WATER & WW (Parent Project) 
P107614 (ADDITIONAL FINANCING MUN WATER & 
WW) 
Country Armenia 
Task Team Leader 
Ahmed A. R. Eiweida 
Sector Manager/Director 
Wael Zakout/Peter Thomson 
Country Director 
Asad Aslam 
Original Board Approval Date 
05/04/2004 
Original Closing Date: 
02/28/2009 
Current Closing Date 
12/31/2011 
Proposed Closing Date [if applicable] 
 
EA Category 
F-Financial Intermediary Assessment 
Revised EA Category 
F-Financial Intermediary Assessment-Financial 
Intermediary Assessment 
EA Completion Date 
09/30/2008 
Revised EA Completion Date 
 
2.  Revised Financing Plan (US$m)
 
Source 
Original 
Revised 
BORR 0.00 
2.56 
IDA 23.00 
23.00 
Total
 
23.00 25.56 
3.  Borrower 
Organization 
Location 
Ministry of Finance and 
Economy 
Armenia 
4.   Implementing Agency
 
Organization 
Location 
Armenia Water and Sewerage 
Company (AWSC) 
Armenia 
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5.   Disbursement Estimates (US$m) 
Actual amount disbursed as of 01/24/2011 
36.43 
Fiscal Year 
Annual 
Cumulative 
2011 0.00 
36.43 
Total
 
36.43
 
6.   Policy Exceptions and Safeguard Policies 
Does the restructured project require any exceptions to Bank policies? 
N
Does the restructured projects trigger any new safeguard policies? If yes, please select 
from the checklist below  and update ISDS accordingly before submitting the package. 
N
7a.  Project Development Objectives/Outcomes 
Original/Current Project Development Objectives/Outcomes 
The project development objective is to improve (i) the quality of services provided to customers in 
AWSC's service area; and (ii) the sustainability of AWSC.  
7b.  Revised Project Development Objectives/Outcomes
 
[if applicable]
 
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ADDITIONAL FINANCING FOR MUNICIPAL WATER
 AND WASTEWATER PROJECT
 
(P107614) 
CREDIT NO: 4514-AM 
 
Restructuring Paper 
 
1. 
Proceeds for the Additional Financing for Municipal Water and Wastewater Project, 
Credit No. 4514-AM, will be reallocated as follow:  
 
Category of Expenditure 
Allocation 
% of Financing 
Current  Revised  Current Revised Current Revised 
(1) Works 
(1) Works 
3,150,000.00 
3,842,000.00 
80% 
80% 
(2) Goods 
(2) Goods 
4,600,000.00 
3,317,000.00 
65% 
65% 
(3) Consultants’ 
Services, 
including the 
Management 
Services 
(3) Consultants’ 
Services, 
including the 
Management 
Services 
4,850,000.00 5,394,000.00 
85% 
of 
Foreign 
Expenditures 
and 80% of 
Local 
Expenditures 
85% of 
Foreign 
Expenditures 
and 80% of 
Local 
Expenditures 
(4) Operating 
Costs 
(4) Operating 
Costs 
200,000.00 247,000.00 
75% 
75% 
TOTAL 
AMOUNT 
TOTAL 
AMOUNT 
12,800,000.00 12,800,000.00 
2. 
Overall implementation
 of the project is satisfactory. Implementation progress has 
improved significantly during the 5
th
 year of management contract with the private sector 
operator, SAUR, as assessed by the Bank task team and the independent technical auditor.
 
Disbursements
 as of January 11, 2011 amounted to US$12.52 million, out of the US$ 20 million 
additional financing, which represented 62.6% of the credit amount. The credit is almost fully 
committed and is expected to close on time- December 31, 2011. 
Major performance indicators
 
indicate continued progress onto meeting the project objectives. 
 
3. 
The proposed reallocation is necessary to provide more resources mainly to the works and 
consultant services category towards the end of the project.  
 
(a) 
Major investments under the project are for improvements in the water supply and 
wastewater collection/disposal system in Hrazdan city. Funds are needed in the 
works category to complete the investments in Hrazdan. The contracts are awarded 
and construction of works started in mid-October 2010. With a very tight 
timetable, the construction works are expected to be completed within a ten month 
period.  
 
(b) 
The management contract between SAUR and the State Committee of Water 
Economy (SCWE) has now been extended for one year to allow timely completion 
of activities.  The funds are needed in consultant services category to enable 
payment of the management fee for this extension.  
 
(c) 
A small increase in operating costs category is needed to allow closer supervision 
and project site visits by the monitoring team. 
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