Announcement of Ten Million US Dollars to Peru on November 3, 1961

0 .,, FOR IMMEDIATE REL.:.EASE WORLD a AN, K .......... · INTERNATIONQAL ,,R1~\.!'JK F<)R '. \,' c:RECONSTRUCTfON AND DE\/ELOPiv'lENT 1818 H STREET, N.W., WASHINGTONJ/25, D. (.:. TELEPHONE: EXECUTIVE 3-6360 ---\';:·------------------------~~-....;;:,------~----~-----------, (} P..:e9 3 Release No. 7'20 SUBJFCT: $l1J m.1J liN1 hig}:,:wa.y Nuvember 3., ·i961 lo~ tc Peru i? The World Bank today made a loan equivalent to $10 milld.on to enable P~ru '" 1) t.) iu1port. equipment a.r.1d materials for highway rna.in.tena.nce and improvem~nt: attd to assist a study of Peru's future traffic nee~a. Ii,0,1.r commercial banks are pB.J'ticipating in the lo.m, witmut the~/iworld Ba-,1k's g.1A,ra.rtc~, t.o the extent of $500,000, representing pa.rt or the :i:"'irst. U1atu~it~r ~ -..... which falls due in - ~ 1965. The participating batiks ar€. Bc.iollk of M01:trea.l, • N~w York Agency of the Royal Bank of' Canada, The First Pennsyl{Jnia Banking ar:1. T.a:-1.1 s·~ CoMpany e.nd Gr~ce National Bank of New York. A. 1sood ;ro~d uetwo-rk is es~entiaJ. in PP-ru where the topography -- rugg~d m1un~ai:1s, ,]uagles and coastal desert -- limits the developm~nt of other fc:cms 0 o'i.' i?-lanr1~ traaspo::-tation. '!he importance of road transport ls re:flec·ted :tn +he (I sh~n il1Cr'7ase in the regist.ra.tion of motor vehicles: in t:i1F! pq,st, cleca.de tht.... n"'J.mh.::!! uf vehicles has more than doubled, from less than 60,000 in 1950 l;o ne~rly 144,ooo in 1960, and further rapid incr~ases are e~ected over the n~~{t CouBE:qUehtly, there is urg~fit 'nefed to maintain the. roar} systelll 1.11 '• "-' guod condit:ioa tl1.l."Ough continuous maintenance operations and to improve road., :=rtcncfa.rdr. wr~erc they are inadequate f'or the growing traffic demand. ln 1955 the Bank lent .Peru $5 million for the import of road ma.inten.t.t.rH!E:: equipmeut ·to make a start on mechanizing the operations of the Highwa.y Derar+- • )! me:ut of th~ Mi.L.iRtry of Development a.nd Public Works. The new loan w:f.11 ca.r.ry  - 2 - !I tnis prog:tam a stage fll!'thi', making it poifSible evcnt11::,J.ly to brini,: under propex- 0 0 maintenance all primary a.aid secondary road$ for which the Highway Dcpartm~pt is . responsible. The Eighway Department will be a.ss~sted by foreign consultants in \\ C~'t'r'3ing out the enlarged maintenance progra.m. A.dequa:.;e ma.i.dtenance will sub- !)' !~') " s.tantially reduce() tho/cost of road transport by prolonging the useful life of' -~ °jf:!7 (} v9hicles and. by savings in operating costs; it will also protect Peru's sub- /; scential investment in highways. 1 "··The loan will also finance the re-surfacing of about 125 miles of pa~:-ed , roads.• including parts of the Pan-American Highway. Moder"n two-lane bridges will be built to replace about 30 narrow bridges on the same highway, _thereby . (_} () \~:) ~eJ_i,vi ng traff.:i.c bottlenecks. A loan of $5. 5 milUon made in DE:cember 1960 i3 helping to finance the reconstruction of a 105-mile section of Peru 1 s Central 0 • ' )// " \1 Highway to improve road transport, b'etween the Amazon are~~i.n Eastern Peru a.an. 1 ;_rua, the capital city. (:::;) In addition, the loan Will cover half the costs of a study of the highway network now being carried out under the sponsorship of the World,Bank and thP. ~· ,1 ,, ' Peruvian Government. The Bank itself is paying for the i::-~ther. half of thiB s·l,u~~' ,,~ ,'; (). .. '~- wn:icn will 'include recommendations for a ten-year highway development program •. This is the Bank'a thirteenth loan in Peru, \j bringing the total to nearly /&v',, $92 mi!Glion. The loan is for a term of nine yea.rs and y~;rs interest at th~ rat.e bf 5- 3/4% a year, including the 1% commission which is allocated to the B'3.ak' s SpecfeJ. Reserve. Amortiza;""ion ,u wi·11 be. gin 0°n~' {,~.( 15, ·1965. _ •