Ulaanbaatar Darkhan Road

Summary

Provision of a loan of up to USD 157 million (EUR 137.7 million) to the state of Mongolia to finance the expansion of a 202 km road in the north of Mongolia from Ulaanbaatar to Darkhan, the country's second-largest city. The road from Ulaanbaatar to Darkhan is an important artery of the Mongolian road network and also part of the China-Mongolia-Russia economic corridor. The current road is narrow, patchy and does not allow for the necessary traffic throughput. It is also dangerous, with at least 10 accident black spots seeing 20-150 accidents each per annum. In addition, some sections of the road were damaged by flooding in 2018. The new project forms Phase II of the reconstruction works and covers the widening of the road to 4 lanes. Phase I works, funded by a loan from the Asian Development Bank's (ADB), comprises the reconstruction of the existing 2-lane road.

Expected Outcome

The goal is to increase the road capacity to be able to accomodate demand for both domestic and international journeys. Road safety and climate resilience will be improved substantially.

Expected Outputs

The project will contribute to the "integrated" quality through the improvement of connectivity between regional cities and second-tier towns, which are currently inadequately connected. The investment will improve road conditions and increase road capacity, supporting regional development. The project will also contribute to the quality "resilient" as it will help the Client develop its asset management capacity through (i) design of a methodology to distribute maintenance funds taking into account socio-economic needs, strategic orientations and Road Asset Management System outputs, (ii) development of performance monitoring and audit procedures, (iii) amendment of the pending secondary legislations required for implementation of Road Fund legislation and (iv) development of human capital to facilitate the sector wide changes.