Upgrading the Yerevan Metro in Armenia

The EBRD in collaboration with the EU and the EIB is helping to restore the capital’s metro service.

Back in 1971 when the construction of a metro started in Armenia’s capital, Yerevan, and the country was part of the Soviet Union, it was considered that metro systems were suited to cities with over 1 million residents and tram systems to those with under 1 million. Building a metro in Yerevan, then with less than a million people, might be viewed as astute forward thinking. Today, Yerevan Metropolitan Karen Demirchyan – named after the man who convinced the then Soviet Communist Party leadership that Armenia needed the metro – serves over 19 million passengers annually.

Growth and decline of the metro

Since opening in 1981, Yerevan Metro has grown from a four-station system extending 7.6 km to 10 stations over 11 km. It has 70 Russian-made carriages, although only 25 carriages are safe to run, with services every five minutes at peak times and every eight minutes off-peak. In past years the metro has been losing passengers to competition from minibuses because of under-investment. This in turn is overcrowding Yerevan’s roads and causing traffic and road safety problems.

Restoring a reliable transport service

Intent on regaining its passenger share and restoring a safe and reliable service, Yerevan Metro approached the EBRD and European Investment Bank (EIB) to finance the renovation of the system. An EBRD loan of €5 million is being matched by the EIB. In addition, the European Union’s Neighbourhood Investment Facility has advanced an investment grant of €5 million. The total funding will finance refurbishment of the rolling stock, rehabilitation of worn-out track and power supply components, purchase of a maintenance trolley and replacement of water pumping stations.

This financing comes at a critical time when liquidity from local commercial banks has dried up as a result of the financial crisis. However, Yerevan Metro is not just receiving new finance. Through a separate project funded by the EBRD Shareholder Special Fund, it is looking into ways of improving its operational performance. A second phase of renovation will follow the first investment, restoring the metro’s fortunes.