Announcement of Seventh Railway Loan to Colombia Approved by World Bank on February 18, 1982

.ll 1 - ; ~ · l-OR IMMl DIA 11 REL EA\I () p •World "Bank ' ~ " 1818H Street, N."1., Washington, D.C. 20433, US.A.• Telephone! (202) 477-1 ~34 -o,, )' \/ () 8ANK NEWS "RELEASE NO." 82/46 Conta,ct: Ciro Gamarra ~ February 18, 1982 (202) 477~934 SEVENTH RAILWAY LOAN TO COLOMQIA APPROVED BY WORLD BANK 1, ,· u Co 1ombi'a I s nati ona 1 "ra i l'way wi 11 use a $77 mi 1lion loan for rehab i 1 i tat ion work and to strengthen its gperations, the World Bank announced today. Six previous railway loan"'s ·:;were used primari ]y ·to integ,rate ,.and extend the national, rai 1 network; some rehabilitation works were undertaken under the sixth railway project in the early 197Qs. ,-, ~:=, The seventh railway loan will he·l p finance a $176. 7 mi 11 ion ·proje,ct to be,, carried out by the Colombian National Railways. The project~ covers the first four years of a five-year: reh,bilitation program, 1982-86. · r~e World Bank loan will finance about 70% of the foreign exchange Gost of purchasing railway goods and services for the project. Additional financing will be , provided by the' railway companyt· $10.4 mi 11 ion; the government,' S79.5 mi 11 ion; the Colombian Coffee Federation, $8.8 million; and the United Nations Development Pro- gramme, $1 mi 11 i on • lmproyements in service- are essential for the railway to fulfill i'ts role in the transpo~t system and to regain it~ finaniial health. About 430 ~ilometers of track will be replaced on the Atlant!c network, a major route with frequent derail- ments. High-horsepower locomotives will be/put into service on the steeply graded Facatativa-Bagazal section, where three loibmotives hooked together are now used. b Other purchases will include rolling stock and special ized equipment for handfing 0 materials, workshops, and communications. Look,ing toward further improvements, a series of studies wi 11 be carried out on the technical and finan~ial problems of managing the national rail ·service4 The World Bank h1'S played an imPi<)rtant role in the development of Colombia 1 s transport system. Since 1950, the Bank has lent over $400 mi 11 iorr for highways, rural roads, railways, and one airport project to assist the government fn develop- in§ basic transport facilities. · The World Bank loan of $77 mi 11 ion to the Colombian National Railways, with the gove;rnment as guarantor, is repayable over 17 years, including four years of grace, ~~t 11.6% interest a year. 0 NOTE: Money figure's are expressed in U.S. dollar equivalents • ••  '., (,) Ll' COUNTRY: , b' . '. ,, ,( TOTAL COST; . . 0 0 cl 0 Se\f.enth .Ra i, lway. Rep4Pl ic ,of· Colombia Ii I\ • $176. 7 m'il l ion 0 BANK. FiNANC ING:- $77 mi 11 ion, with repayment Tn 17 years, including C7 four years··of grac~; at° 11.6% inte"r~st a year OTHER FINANCING: ·Colombian Coffee FederatJon'~ $8.8 mi 11 ion; UNDP Techn i ca 1 Assis tanc"eJ $1 million; Government of COl 0111,b ta,, $79. 5 mi 1'1 ion Colombi~n ~atibnal R~11waysj $10.4 miiliom \) C: IMPLEHENTIN~ ,ORGANIZATION: Colombian National Railways (CNR) Calle 13, ~o. 18-24 Bogota , Co 1omb i a · 0 ·CABLE: FERROCARRILES BOGOTA PROJECT DESCRIPTfON: It comprises the first four years of a fiv~-year rel)abi 1 i- tati6'n program (1982-86) for the Cof~m.bian National Rail- ways (C.NR). There are two tra·nches, the,second fo depend on_'traffic. Th~ first tranche consists of: (a") rehabilitation of about -X.28 km of tra~~; b)acqulsltlon ·of four diesel • locomotives, and related spa,re parts,. and 100 w·aqons; rehabilitation o.f 139 diesel loco IJlO:.tives, 1C'~10 freight cars and locomotive Spares; d)rehabilltatlon and upga-adfng of work- shop; (e)· rehabilitation of freight-handling equipment and purchase of forkl.ift trucks, cranes, and equipment for communications; and (f) techraical assistance. to study: , c (i) 'Bogota-Buenaventura Corridor; (ii) line capacity; (it t) communications; (iv) ·financial 0 management; (v) locomotive repair and, scrapping: (vi) a traffic demand model; ' (vii) operating costs, and (viii) trai.ning f9rCNR's techrical staff ... The second tranche 0 comprises: (a) rehabilitation of another 83 km of track;" (b) purchise of 4 additional 1ocbmotives and 100 wagons in~lwding /f\' related spare parts; and (c) communications equlp- jj "tent. PROCUREMENT: A11 items acqufred with the proceeds of the loan will be 0 subject to international competitlve bidding, Jn accordance 1;1ith Bank g.uldelines. These items include locomotives,", freight cars, rails, "fittings, o track maintenance equipment, railway switches, workshop machinery, forklift trucks, sig- nal and telecomnunication equipment, and\spare parts for locomotives and freight cars. ,) Local bidders wi 11 be granted a margin of"\preference by adding 15% or the relevant pre- vai 'fjng ievel of customs duties, w~ichever is lower, to the c.i.f. value of foreign bids. CONSULTANT'S: A series of studies on operational and financya1. matters and a training program will be carried out. ~-~" E&ONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: 26% 1985 - 0 - • ()