Announcement of Fifteen Million US dollars Loan for Irrigation in Mexico on January 16, 1961

•. ·n , .. , .... :_.i·~•. - - R I MM,EDIA TE RELEASE JNTERf"·.1.ATIONAL. L-:1ANK FOR RECC)f'J~:TRl_JCTlOf·-J Ai"'~D D'EVELOPfv1ENT ,, 1818 ~ STR;EET, N.W., WASHINGTPN 25, D. C. TELEFHONE: EXECUTIVE,3-63.60 \~. .... \ 0 PRESS RELEASE NO. 667 !) SJBJECT: $15 million loan tor Monday, Janua:ey 16, 1961 irrigation in Mexico The WOrld:·BaDk today ma.de a loan equivalent to $'15 million for the improve- ment of irrigation on 1,430,000 acres of farmland in Mexico. The loan ·rill finance the fo~eign t":i.cha.nge costs of completing and rehabilitating tour irri- u gation systems on Mexico' .S northwest coast. When the proj~~t . . 4. . . __is,.-···.--. • complet._e., ,_the ..;. \_) • . annual'· net income from crop production on the la.tide is expected to incr~a.se by. the equiv~ent of about $20 million. Six private banks are participating in the loan., without the World Bank's guarantee,· tor a total. ot 1 $82l,OOO, representing the first three ~turit:les · which fall due between July l, 1961,. and July 1, 1965. The participating banks are: Crocker-Anglo National Bank, san ·:r.ranciscoj The Northern TrUst Company.,' ~) \·, Chicago; Chemical. Bank New York Trust Company; Girard Trust Corn Exchange Batik, Philadelphia; The First National. City Bank of New· ·york; and Grace National. Bank of New York. 'Die loan was made to the Nacional Financiera, a financial agency of the Mexican Government. ibe proJect will be carried out by the Secretariat of·· B,ydrauli(~ '.Resources, which was established in 1947 to develop and administer ~~ . the water resources of Mexico.· . . . • I; ( • . • • The developnent ot·trrtga~ion f~.has been an important factor in the gl.'Ovth of agriculture 1n Mexico. ~~ction :frO~ irrigated lan.d now represents. ~.. ~---·' m~ than·a third of ~e total value ot agricultural production and·accounts  ,._,,J ; Ci\·· - 2 - tor nearly a th~d of total. comabdity exports. The"· ma.in crops are cotton, wheat, u corn.., sugar cane., true~ and other food crops. Exports include cotton, · sugar and truck. crops, particularly melons $lid tomatoes. Until recently Mexico imi;_,orted . 8'1bstanti.al volumes· of wheat and corn, but now produces almost all its own food Most of the expansion ot irrigated land has been the result of public· in- vestment, mainly in large-scale ·project,s whiJch now encompass more·· th~ 6,700, OQO. " acres. In 1959., product:i.on frompubfic irrigation projects alone was valued at ~pproximately 5 ·bi~ion pesos ($40Q million). The Government intends to carry out. a three-year program ,to comple~e ·M.d - --- ...... . ...._._ rehabilitate 22 ·ia:rge irrigatio~ districts where inadequate drainage syste~ . . . . \,.) have led to rising water tables and increased salinity. The project -to be financed vitb the ~orld Bank loan includes four irrigation districts and con- \'; 1\ s~itutes the first st98e of this p2-ogram. The four districts -- CUliacan, Fuerte, Mayo and Yaqui -- are located on the Gulf' of California, south bf Guaymas, c:~/ in a region of low rainfall, and are named after the main rivers which supply i. water :to them; each is served by highways and rialways, and each supports at least . one important city~ The topography and soil are ideal for irrigation: .) the land is ·nearly flat; soils range from silt to h~avy clay loams. .. . (( The n:>st importa:it work to be undertaken will 1jbe thr digging of new canals . j\ and drains, the .enlargement of old ones, and the installation of about 9,000 // simple reinforced. concrete control structures. The improvements will reduce or prevent salinity, reduce flood damage, extend the distribution ·of water, (~ provide better control of water, and enable :l'a.rmers to bring some new lands . . into production. The Bank loan will also finance the purchase -of maintenance . . L . . \ ~ . equipnen:" to secure the efficient operation.~d maintenance of the rehabilitated ~) (, syetems.  - 3 - in order to help water users take full advantage of the publi~ works to be ,, . UQ.Q!rts.ken, the Secretariat of Bydraw.ic Resources will prepare plans for pri- ~ ~ r? vate on-farm work, such as ,drainage, leveling and leaching of heavily salted la.nae, and, where necessa?'Y, the Government will make credit available·on !/ . ij • reasonable terms to meet the cost of ~eeded construction. • (i The total. cost of the P'J.blic works to be unde~wta:ken is estimated at the · equivalent of $41 million. The WBank loan 1v"ill cover. t?~J foreign exchange 0 ?001- 11 ponent and th:e domestic currency costs will be financed by the Government, of Mexico. The ·major" worka wil.l be carried out under contr~cts. awarded on the '1 basis of international competition and all the maintenance eq-J.ipment financed. .. ..... • • • .. ": by the Wor~d Bank loan will be obtained t~ugh international· competitive .· bidd.:tnga The public works to be undertaken are schedllled for completion in three years and the private on-fa.rm work about a year later. '!'he Bank loan is for a term of. 20 years and bears interest of 5-3/41, annually including the 11, commission which is allocated to the Bank's Special:, Reserve. Amortization will begin July 1 1 1964. The loan is guaranteed by t~e United Mexican Staies. Including today's loan the Bank has lent $226 million in Mexico.for the develqpment Qf electric power, railway rehabilitation and ~a.d ~onstruct·ion and improvement • • ~ '  .. • • 0 ·-·- ....................... ·,. , ·, UNITED STATES . ~--.. NoQOltt - ·-:--- • =.-. - •_. -~--~. __ ' I I I t N I I \ \ \ \ MEXICAN IRRIGATION LA ANGOSTURA \ .REHABILITATION PROGRAM I I FIRST STAGE I I I Irrigation Plstricts I I Reservoirs 0 50 100. 150Km. . 0 N 0 U A. H U A 0 ~. ~ :~ \ {) . ~ La Paz ' \ JUNE 1960 IBRD-701