Announcement of One Million Five Hundred Thousand US Dollars Credit to Niger for Roads on June 24, 1964

'l' r./l tJl 0 • C") ~ INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET, NW, WASHINGTON 25, D. C. TELEPHONE. EXECUTIVE 3-6360 IDA Press Release No. 64/10 Subject: $1.5 million credit to June 24, 1964 Niger f'or roads The International Development Association (IDA) today extended a credit equ:f.va- lent to $1.5 million to Niger. This is the first operation in Niger by one of the World Bank group of financing institutions. The credit will finance two small, higtr priority road projects in southeastern Niger, an important agricultural area. The roads will facilitate the transport of groundnuts, the chief export, to the border of Nigeria for shipment over~eas via the Nigerian transport system. Niger, a landlocked country some 800 miles from the sea, has a large area, about 4I 2} times the size of France. Its population of 3,000,000 is almost entirely rural or pastoral; Niamey, the capital and largest city, has no :nore than 50,000 inhabj_ .. tants. Per capita income is estimated at about $70 a year. Only a relatively narrow strip of land in the southern part of' the country has enough rainfall for agriculture and it is here that the greater part of the population is settled. Over8eas exports must be carried long distances for shipment out of ports in neigh- boring Nige~:ia or Da.home;,r, and the resulting high qost of transport severely re- , . stricts the count:cy' s capacity for earning .foreign exchange. Un.c1e1· the IDA Cl'fld.it a, 21-mile earth road from D.e,mthiao to Dungass will be improved and a new late1·ite ... surfaced road of' about the same length will be built from Dungass to Maigatari on the Niger-Nigerian boreer. On its side o.f the border, the Nigerian Government intends to pave the only unpaved section of the road which • links. Ma.igatari With the railhead at Kano. With completion of the project roa&,  - 2 - Dwlgass will become a transshipment center, and the road to Maitsatari Will form one of the three ma.in routes for the overseas shipment of groundnuts. • The roads are expected to reduce.the cost of transporting groundnuts from the Dunga.ss area by nearly half, thus benef'iting producers. Savings in transport costs will be achieved because the distances between producing centers and Kano will be shortened, truck transport can be substituted for the more expensive camel t:ransport, and better roads will enable truckers to reduce their rates. The roads should also attract additional settlers to the area and stimulate increased agri- cultural activity. Niger's national road network comprises some 2,900 miles, of which about half have laterite surface; the remainder are earth roads, many ungraded. The amount of Government revenues which can be spared for road expenditures is all needed to finance essential llla.intenance operations; almost all new construction is being • financed wholly by external aid. In these circumstances, the IDA credit will cover the total cost of the Dungass roads, most of which is foreign exchange. The construct1.on contract will be a.warded on the basis of international competitive bidding, and the roads will be built under the supervision of consultants. The IDA credit is for a term of 50 years. Repayment of principal will begin January 15, 1975, arter a 10-year period of grace. One percent w::1.11 be repayable annually for the following 10 years and 'J'/o will be repayable annually for the final 30 yea.rs. There will be no interest, but a service charge of 3/4 of 1% will be made on the amount withdra.wn a.nd outstanding to cover IDA' s administrative costs • •