Armenia to take €300m in loans for Syunik development and housing for displaced people

The Armenian government is set to take out loans totaling about €300m to fund regional development in Syunik Province and housing programs for Armenians forcibly displaced from Nagorno-Karabakh (Artsakh).

Presenting the agreement with the European Investment Bank (EIB) to lawmakers on Tuesday, Deputy Minister of Territorial Administration and Infrastructure Kristine Ghalechyan said a €50m loan would support the Resilient Syunik program. The funding will be directed at improving water supply, education and healthcare services in the southern region, with the aim of boosting economic resilience and living standards.

Separately, Deputy Minister of Labor and Social Affairs Davit Khachatryan outlined a $250m loan agreement with the Asian Development Bank under the THRIVE housing reform program. The initiative is designed to help create a sustainable and inclusive housing system for displaced Artsakh Armenians.

Khachatryan said the government-approved housing support scheme, launched in mid-2024, has so far enabled more than 1,600 families to purchase homes, while another 2,200 families have received housing certificates and are searching for properties. The program operates through commercial banks using a mortgage mechanism, with the state covering both principal and interest over a 10-year period.

The ADB loan has a 27-year term, including a 10-year grace period, an interest rate of 4.84%, and repayments beginning in 2035. An additional $16m will be provided as a grant.

Opposition MP Artur Khachatryan criticized the program, saying it has failed to meet its target given the scale of displacement, and warned against borrowing without significant changes. The government says eligibility criteria have since been adjusted.