Announcement of Sixty Million US Dollars for Flood Recovery in Romania on November 6, 1975

•World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 Bank News Release No. 75/90 November 6, 1975 $60 MILLION FOR FLOOD RECOVERY IN ROMANIA The World Bank has approved two loans totalling $60 million to help finance a flood recovery project in Romania. Serious floods in early July 1975 caused extensive damage in the Mures, the Olt, the Arges, the Ialomita and the Buzau river basins where over 80% of all the damages occurred. Industry, agriculture and transportation all suffered extensive damages. Many existing flood protection works were also damaged or destroyed. The multi-sectorial project will help Romania recover from the floods. The industrial component consists of investments in 223 enterprises. to replace eqlripment and spare parts damaged by the floods. The agricultural component will extend credit • to cooperatives and state farms which have suffered. serious losses as a result of the floods. About 120 kilometers of the national road system, and 270 kilometers of the rail system, will be reconstructed. The project also provides for repair of damaged flood protection, irrigation and drainage works, and for improvement of the national flood monitoring and warning system. Loans of $20 million to the Investment Bank of Romania and of $40 million to the Bank for Agriculture and Food Industry (BAFI) have the guarantee of the Socialist Republic of Romania. Credit Commercial de France (Suisse) S.A., Geneva, has agreed to participate in both Bank loans. The loan to the Investment Bank has a term of 20 years including three years of grace with interest at 8 1/2% per annum. The loan to BAFI has a term of 20 years including five years of grace with interest at 8 1/2% per ann~. Note: Money figures are expressed in US dollar equivalents. \. • Form-No. 1121 (9-75) TECHNICAL DATA • PROJECT: Flood Recovery Project COUNTRY: Romania TOTAL COST: $345 million BANK FINANCING: $60 million in ,,arioUA currencies including $20 million to the Investment Bank and $40 million to the Bank for Agriculture and Food Industry (BAFI). Amortization in 20 years including a three~year grace period for the Investnent Bank; and in 20 years, including a five-year grace period for BAFI. OTHER FINANCING: Farm entities $5a3 million; state funds $279.7 million. IMPLEMENTING ORGANXZATION: The Investment Bank will have overaJ.~ responsibility for execution of the industry and transport rehabilitation. BAFI will have overall responsibility for execution of the agriculturaJ. investments and flood protection components. • PROJECT DESCRIPTION: The project consists of investments in' 233 industrial enterprises (including power and mining) damaged by the 1975 floods, to replace flood-damaged machinery and spare parts, repair damaged buildings and infrastructure' reopen mines blocked by silt' end replenish . damaged and lost inventories; rehabilitation of 285 irri~ation. drainage arid flood control works which were damaged by the floods; improvement of Romania's existing hydrological. data system through provision of automated flood warning equipment; investments (in crop or livestock production") of farm enterprises which suffered serious losses as a result of the floods; reconstruction of abo'ut 120 kilometers of national high~s, including 18 bridges, and 270 kilometers of railroads, including 20 bridges. PROCUREMENT: The goods to be financed under the project will be procured in accordance with the Bank's guidelines. ESTIMATED COMPLETION DATE: 1978 -0- •