Announcement of Tunisia to Improve Urban Shelter, Services for Low-income Groups and to Carry Out Energy Conservation Demonstration Project on July 8, 1987

- FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 87/1 Contact: Fawzi Rihane (202) 477-5325 TUNISIA TO IMPROVE URBAN SHELTER, SERVICES FOR LOW-INCOME GROUPS; CARRY OUT ENERGY CONSERVATION DEMONSTRATION PROJECT WASHINGTON, July 8 -- Tunisia will use two loans totalling $34.2 million from the World Bank to improve shelter and urban services in low-income areas and to carry out a demonstration project in energy conservation. The urban development project will benefit directly about 150,000 people. And the second project is expected to yield energy savings estimated at about $3.4 million a year. Urban development Tunisia will use a loan of $30.2 million in an effort to improve shelter and urban services in low-income, under-served settlements across the country. This effort includes developing serviced land that is affordable to low-income people and strengthening key institutions in the sector and the coordination among them. The project consists of three parts: upgrading of infrastructure and community facilities in under-served settlements, development of serviced sites for low-income groups, and technical assistance to the land development agency and the Direction des Collectivites Locales in the Ministry of Finance and Economy. The country's urban upgrading and renewal agency (ARRU) has identified 18 sites for upgrading and the land development agency (AFH) has identified another 20 sites for servicing. Funds from the World Bank loan will also be used to provide individual loans for house construction or improvements. About 90,000 people will benefit directly from improvements in urban services in their communities. Another 60,000 people will benefit from the availability of serviced plots at affordable prices. Residents near the project area will also benefit from their proximity to improved services and environment. The project is estimated to cost $67.4 million overall. The government is providing $24.2 million, and AFH and the National Housing and Savings Fund, a total of $13 million, to help finance the project. • •• I NOTE: Money figures are expressed in U.S. dollar equivalents.  - 2 - Energy conservation demonstration project Tunisia will use a second loan, of $4 million, from the World Bank to support efforts by the Agency for Energy Conservation (AME) to develop an effective institutional and policy framework for a national energy conservation program. This project also includes efforts to strengthen the Agency's abilities to promote and monitor the national energy action program, and the capabilities of Tunisian consultants to carry out energy audits and to implement programs to conserve energy at the consumer level. The project will finance the development and implementation of specific programs to conserve energy for 28 enterprises to demonstrate the benefits of conservation to other consumers in the same sectors. These enterprises include manufacturing concerns, transport companies, and hotels. The project is expected to completed by the end of 1989 at an overall cost of $6.25 million. The government and the enterprises participating in the project will provide a total of $2.25 million towards the cost of the project. The World Bank loan for the urban project is for 20 years, including three years' grace; the loan for the energy project for 17 years, including ) four years' grace, each with a variable interest rate, currently 8.23 percent, linked to the cost of the Bank's borrowings. Each loan also carries an annual commitment charge of 0.75 percent on the undisbursed balances. - 0 -