Announcement of Ten Million Eight Hundred Thousand US Dollars Highway Loan to Chile on April 29, 1970

. JNTERNATIONAL B.ANK FOR •RECONSTRUCTION AND DEVELOPMENT 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXE:CUTIVE 3-6360 Bank Press Release No. 70/23 Subject: $10.8 million highway loan April 29, 1970 to Chile The World Bank today announced a loan of $10.8 million to Chile to help finance a highway project that is expected to result in substantial savings in vehicle operating and highway maintenance costs, and help relieve traffic congestion in the densely populated zone centered on Santiago, where half of Chile's 10 million people live. The project involves construction or improve- ment of four sections of national highways totaling approximately 103 miles, . • provision of consulting services for construction supervision, and feasibility studies and detailed engineering for approximately 310 miles of highways for a future construction program. Chile has a comprehensive road and rail system, spanning some 1,600 miles from the border with Peru in the north to Puerto Montt at the southern end of the central valley. Although generally there is adequate capacity in the high- way network, congestion has become a serious problem in the vicinity of Santiago, the capital. The four road sections in the project are (1,,) Padre Hurtado-Puangue, part of an expressway which is the shortest route between Santiago and the port of San Antonio; {2) San Antonio-Algarrobo, a coastal road. which joins the main Santiago.,.San Antonio expressway; (3) Puchuncavi-La Laguna, a road used to carry copper ore for refining to Ventanas near Puchuncavi; and (4) Loncomilla- • Constitucion, part of a highway joining the Longitudinal Highway and the port town of Co:rM:ltitucion; this road is in an important forest zone and will serve a cellulosf.l plant now being built near Constitucion. /more Bank P.R. No. 70/23 - Chile-Highways - 2 - The project will be executed by the Highway Department (Vialidad) of the Ministry of Public Works and Transport, and is scheduled to be completed by •• 1973. All construction work will be carried out by contracts let on the basis of international competitive bidding. The total cost of the project is estimated at the equivalent of $23.8 mil- lion. The Bank loan will finance all foreign exchange costs estimated $10.8 mil- lion equivalent, and the Government of Chile will meet local costs. The loan will be made to the Republic of Chile· for a term of 25 years, in- ~l~ding four years of grace, with interest at 7%. This will be the fifth operation by the Bank Group for highway development in Chile, and brings the total provided for that purpose to $47.6 million. This total includes a technical assistance grant of $210,000 made by the Bank in 1966 to provide consulting services for highway planning and feasibility studies, which served as the basis for the present project. • - 0 - •