Announcement of World Bank to Assist Manila Slum Upgrading on May 28, 1976

.World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393~6360 BANK NEWS RELEASE NO. 76/67 MAY 28, 1976 WORLD BANK TO ASSIST MANILA SLUM UPGRADING Approximately 180,000 slum area residents will directly benefit from an urban development project in Manila, Philippines, which is being assisted by the World Bank with two loans totaling $32 mill ion. One loan of $22 mill ion is on conventional World Bank terms. The other loan of $10 mill ion is on the Bank's 11 Third Window'; terms. The project seeks to demonstrate that upgrading and improvement of slum areas is an appropriate alternative to resettlement. The area covered by the project embraces the Tonda Foreshore, one of Manila's worst slums, and the neighboring Dagat-Dagatan area, where the first phase of a sites and services settlement will be developed . • In the two areas, health, nutrition and other social service improvements will be integrated with physical improvements in water supply, sewerage and drainage; as far as possible, individual water and sewer connections will be provided. Also included in the project are traffic engineering and management improvements and technical assistance for the Metropolitan Manila Government, as well as technical assistance for national transportation planning. The project is expected to generate a wide range of benefits, including improvements in health and living conditions and creation by the private sector of about 800 industrial and commercial jobs. Another 200 jobs will be created through a cottage industry loan program. Both Bank loans are being made to the Republic of the Philippines. The conventional loan of )22 million is for 22 years, including 5 years of grace and will carry interest at 8!% per annum. The Third Window loan is for 25 years, including 7 years of grace, and will carry interest at 4!% per annum. An additional 4% will be paid to tne Bank by the Interest Subsidy Fund, representing the difference between the Bank's standard interest rate and the charge to the Philippines . • Note: Money figures are expressed in U.S. dollar equivalents. Form No. 1121 (9-75) • T E CHN I CAL DATA PROJECT:· Manila Urban Development COUNTRY: Phi 1 i pp i nes TOTAL COST: $65mi11ion BANK FINANCING: $32 mi 11 ion, consisting of ( l) Convent i ona 1 Bank loan of $22 million for 22 years, including 5 years of grace, with interest at 8!% per annum. (2) Third Window loan of $10 mill ion for 25 years, including 7 ~ears of grace? with interest at 4tt per annum. OTHER FINANCING: National Housing Authority (NHA), $19.2 mill ion; Government of the Philippines, $13.6 mill ion; Metropol itarr Waterworks and Sewerage System (MWSS), $3qO,OOO. IMPLEMENTING ORGANIZATION: NHA, Manila, Philippines, is the principal Government Agency implementing the project. NHA will coordinate with the following other Gover.nme:nt agencies executing other parts of the project: (1) Department of Public Highways, (2) MWSS, (3) Department of Public Works, Transportation and Communications, and (4) the Development Bank of the Philippines, and at NHA's option, the Philippine National Bank or Philippine Business for Social Progress, which will administer the 1 ines of credit for cottage industry. PROJECT DESCRIPTION: Consists of: (1) Upgrading of Tonda Foreshore area by providing improved environmental sanitation infrastructure and social services; (2) Developing first phase of sites and services settlement at • Dagat-Dagatan; (3) Provision of off-site infrastructure; (4) Construction of major roads; (5) Traffic and transport improvement; and (6) Technical assistance. PROCUREMENT: Civil works contracts of more than $1 million each, for a total of about $12 mill ion, wil 1 be obtained on the basis of international competitive bidding. Civil works contracts up to $1 mill ion each, for a total of $15 million, will be procured on the basis of competitive bidding advertised locally; contractors for these contracts will, however, be prequal ified. With respect to procurement of materials, all contracts over $100,000 except materials for house improvement will be obtained under international competitive bidding. Contracts below $100,000 and for materials for house improvement, which will be phased over the project implementation period and cannot conveniently be bulked, will be tendered on the basis of competitive bids advertised locally. For the cottage industry loans, equipment will be procured in accordance with DBP procedures. CONSULTANTS: The project contains about 46 man-years of consulting services. ECONOMIC RATE OF RETURN: Estimated weighted average economic rate of return for the~ Tonda Foreshore, Dagat-Dagatan and major roads components cf the project is 27%. ESTIMATED COMPLETION DATE: March 1981. -0-