ArmInfo. On March 19, 2026, in the presence of RA Deputy Prime Minister Mher Grigoryan, representatives of the RA government, Ambassador Extraordinary and Plenipotentiary of the Federal Republic of Germany to Armenia Claudia Busch, EU Commissioner Marta Kos, as well as representatives of KFW and the European Investment Bank (EIB), RA Finance Minister Vahe Hovhannisyan and KFW Director Veronica Garcia del Arco signed agreements for loans and grants totaling 135 million euros to finance the Caucasus Transmission Network project.
According to the press service of the Armenian Ministry of Finance, under the loan agreement, KFW is providing a 120 million euro loan with a risk insurance guarantee from the German government, while a 15 million euro grant will be provided through the EU Neighborhood Investment Platform. These new commitments complement the grants and loans previously provided by the German government and the European Commission, bringing the total amount of support to 313.2 million euros. The European Investment Bank is also co-financing the project, currently allocating 10 million euros. The Armenian Minister of Finance noted the significance of these agreements: "Today's signing of the loan and grant agreements is a key milestone in the implementation of the Caucasus Transmission Network project and in strengthening regional energy cooperation. This project will contribute to the creation of a more reliable, efficient, and interconnected energy system in the region, expanding cross-border electricity exchanges, and enhancing energy security. We highly value this cooperation with the World Bank, the German government, and the European Union and are confident that the successful implementation of this project will strengthen regional connectivity and contribute to the sustainable development of the South Caucasus.
As the Ministry of Finance noted, the resources allocated to strengthen Armenia's energy security and independence will enable the expansion of renewable energy production throughout the country and strengthen the regional integration of the Armenian electricity market through the Caucasus Transmission Network. The project will ensure reliable, flexible, and mutually beneficial cross-border energy exchange in the South Caucasus. Furthermore, Armenia will gain access to the European electricity grid.
"One of the main pillars of our bilateral cooperation is supporting Armenia's regional integration and the development of its energy sector. We want to contribute to its sustainability, efficiency, and environmental friendliness by enhancing the stability of the energy system and developing renewable energy." Both Chancellor Merz and Prime Minister Nikol Pashinyan have included energy cooperation in the joint declaration on the strategic agenda between Germany and Armenia, which they signed last December," German Ambassador to Armenia Claudia Busch noted.
"With these investments, we are putting our words into action and demonstrating to Armenia that we are serious about ensuring its energy security. The Caucasus Transmission Network is a priority investment that promotes regional integration of the electricity market while strengthening Armenia's energy security and independence. These connections are more than just infrastructure: they are a path to more efficient renewable energy solutions and diversified partnerships with neighboring countries," European Commissioner Marta Kos said.
