Announcement of World Bank Supports Highway Rehabilitation in Mexico on June 24, 1993

FOR IMMEDIATE RELFASE World Bank 18 18 H Street NAW Washington, D C. 20433, U.5 A * Telephone; (202) 477-1234 BANK NEWS RELEASE NO. 93/110LAC Contact: Ciro Gamana (202) 473-8721 WORLD BANK SUPPORTS HIGHWAY REHABILITATION IN MEXICO Washington, D.C., June 24, 1993 -- The World Bank has approved a $480 million loan to Mexico to help finance a project to rehabilitate and resurface highways of the federal network and to implement a road traffic safety program in the country. The project includes an institutional strengthening component for improving transport cctor planning and policies of the Secretaria de Comunicaciones y Transportes (SCT) and azeasures to improve funding for highway rehabilitation, resurfacing and maintenance. The World Bank loan will finance a portion of SCT's 1993-1996 highway ret,m'tation, resurfacing and maintenance program, the traffic safety and institutional comporients, including technical assistance, studies and training. It is estimated that the World Bank loan will hclp to finance rehabilitation and resurfacing works of about 27.000 km of the 45.000 km federal road network and improvement of some 350 hazardous road locations The total project cost is estimated at about $1,560 million, of which the government of Mexico will finance $1,079.88 million. A road s&fety seminar, with a cost of about $120.000, will be financed with assistance of Swdcn. United Kingdom, France and the Mexican private sector. * project's main benefit will be to reduce road transport costs by protecting the condit>:4 ,;f the federal highways and by reducing the rehabilitation backlog on the most trafike highways. Given that about 60 percent of the highway network is in poor condition, rendering road transport expensive, the project is expected to yield substantial The World Bank loan, to be disbursed over seven years, was made to Banco Nacional de Obras y Servicios Publicos, S.N.C. (BANOBRAS), with the guarantee of the United Mexican Sye- It is for 15 years, including 5 years of grace, with a variable interest rate, currently 7 percent, linked to the cost of the Bank borrowings. It also carries an annual comniitment arge of 0.25 percent on the undisbursed balance. NOTF 1'' I k' i U.S. &A.'- -t;',vaic"Ls