Lincy Foundation Completes $170 Million Project in Armenia

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By Harut Sassounian
Publisher, The California Courier

It is said that bad news travels fast. In the case of Armenia, there has been plenty of bad news in the past 15 years, starting with the Karabagh War, the earthquake, the blockade by Turkey and Azerbaijan, emigration, and economic as well as political turmoil. The population of Armenia suffered through several very harsh winters without heat and electricity, and not much food. Over a million Armenians, trying to survive, were forced to leave their homeland.

Even though the situation has improved in recent years, some Armenians in and out of Armenia are still under the impression that the country is hopelessly mired in a myriad of difficulties and that nothing positive can be accomplished there. I felt it would be appropriate and uplifting, particularly during this Holiday Season, to share some good news about a particular recent accomplishment in Armenia.

With funds provided by The Lincy Foundation, The Armenian government just completed $150 million of construction projects as well as $20 million of loans to small and medium size businesses. The infrastructure projects consisted of highways, tunnels and bridges ($73 million); housing in the earthquake zone ($45 million); cultural institutions ($18 million); and Yerevan streets ($14 million).

The $73 million road project built or repaired over 270 miles of highways throughout Armenia, as well as several key bridges and tunnels. Work on the 1.5-mile long Sevan-Dilijan tunnel was started during the Soviet period, but abandoned due to its complexity and high cost. Now completed with a $9 million grant from Lincy, the tunnel makes travel possible during the winter months when the road is occasionally blocked by heavy snowfall.

The $45 million housing project repaired or reconstructed 149 buildings or 3,674 apartments in the earthquake zone (Gumri, Akhurian, Spitak, Vanadzor, Stepanavan, and Gugark). This means that 3,674 families, who have been living in temporary shipping containers for the past 15 years, are now the proud and happy owners of their own modern living quarters.

The $18 million cultural project renovated almost all of Armenia's major cultural institutions: the Opera and Ballet Academic Theater, the Aram Khachatrian Philharmonic Hall, Gumri's Vardan Ajemian Dramatic Theater, as well as 10 other theaters and concert halls; the Paradjanov, Charents, Toumanian, Saryan, and 5 other home-museums; the Mesrop Mashtots Depository of Ancient Manuscripts (Madenataran), the State Museum of History of Armenia, the Vanadzor Cultural Palace, and 4 other museums and exhibition halls; Garni, the Genocide Memorial Museum, and 2 other historical-cultural complexes; and the All-Armenian youth camp in Tsaghgadzor which includes a youth hostel as well as a modern Olympic-size indoor swimming pool. Most of these buildings are now equipped with modern lighting, sound, and fire-fighting equipment, as well as heating and air conditioning, so they can operate year-round.

The $14 million street project renovated 17 major streets and sidewalks as well as two main squares in Yerevan. New street and traffic lights were installed on all repaired streets. The dilapidated underground pipes for water, sewage and gas, as well as the old electric wires crossing the renovated streets were replaced.

Given the massive scale and high visibility of these major projects, multiple layers of supervision were established to ensure that the allocated funds would serve their intended purpose. The President of Armenia personally, as well as his immediate staff, closely monitored the progress of these projects and took the strictest measures whenever required. In addition to the oversight provided by various governmental agencies, Lincy had its own staff of highly competent and trustworthy engineers who independently oversaw the construction process. As Vice Chairman of the Lincy Foundation, I was on an almost daily phone contact with the Chief of Staff of the President and made several trips to Armenia over the past three years to ensure that these projects were carried out in compliance with the terms and conditions of the memorandum of understanding signed between Lincy and the Government of Armenia.

The bidding requirements for these projects were advertised in local newspapers and the contracts were awarded to the lowest reasonable bidders in line with World Bank procedures. All of these projects were carried out by local Armenian companies and workers. This meant that, in addition to repairing Armenia's infrastructure, these projects provided employment to around 20,000 workers, raising their standard of living.

Whenever the quality of the construction was deemed unacceptable, no payment was made for the work performed. The contractor was asked to redo the work at his own expense. If the second time around the work was found to be of inferior quality, the contractor was removed and replaced by another company with a proven track record.

Upon the successful completion of each segment of a project, the contractor was paid 90% of the value of the contract. Another 5% was paid after the entire project was satisfactorily completed. The final 5% was paid 12 months later, if no defects surfaced in the meantime.

The unprecedented scale of construction in such a short period of time has had a tremendous impact on Armenia's economic development. The Lincy projects helped diminish the exodus of workers from Armenia, gave a boost to locally produced construction materials, and introduced western business practices to the local construction industry. The successful completion of these projects proves that, if properly planned and executed, much good work can be accomplished in Armenia with a minimum of waste and corruption. These projects also give the people of Armenia renewed hope and a sense of optimism for the future.