Announcement of Papua New Guinea Receives Nineteen Million Dollars Credit for Highways on January 27, 1977

World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 IDA NEWS RELEASE NO. 77/25 JANUARY 27, 1977 PAPUA NEW GUINEA RECEIVES $19 MILLl9N CREDIT FOR HIGHWAYS The Highlands Highway in Papua New Guinea will be improved as a result of a Government project being assisted by the World Bank. The International Development Association (IDA), an affiliate of the World Bank, has approved a $19 min ion credit to help finance the project. The objective of the projett is to help in increasing output and income in the Central Highlands area. The region contains about 60% of the mainland population but has only about 20% of the country's wealth. The very fertile soil of the Central Highlands is capable of growing a variety of cash crops as well as fruits and vegetables. It also is suitable for cattle grazing. Yet the only commercial production at present is coffee • and tea. To unlock this potential, an all-weather road link with the port of Lae is required, together with other measures to develop the agricultural potential of the area served by this road. At present, the gravel-surfaced highway is frequently impassable during rainy weather. Despite prompt maintenance efforts, vehicles are often forced to wait for hours and sometimes even days before the road can be cleared. These delays are costly, especially when vehicles are carrying ?erishable cargoes. The project includes rural development studies aimed at identifying and preparing a series of integrated rural development projects in the Chimbu and Enga Provinces. The roads project ~onsists of construction and improvement, including bituminous paving of three sections totaling about 68 kilometers, of ·the Highlands Highway between Goroka and Garnigl. It includes detailed engineer- ing of some 317 kilometers between Waterais and Togoba. A feasibi1 ity study for construction and improvement of the 63-kilometer road from Togoba to Wapenamanda will be conducted, to be followed by detailed engineering if warranted. The feasibility study of the Waterais-Togoba road will be updated in preparation for further improvements of the Highlands Highway. The $19 million IDA credit is for a term of 50 years including 10 years • of grace. It is interest free, except for a service charge .of 3/4 of 1% to meet IDA's administrative costs. Note: Money figures are expressed in U.S. dollar equivalents. FORM NO. 1121 (5-76) T ECHN I CAL DAT A PROJECT: COUNTRY: Second Highlands Road Improvement Papua New Guinea • TOTAL COST: $27.5 million I DA FI NANC I NG : $19 mi 11 ion at standard I DA terms OTHER FINANCING: Government of P~pua New Guinea IMPLEMENTING ORGANIZATION: Department of Transport, Works and Supply P ~ 0. 1108 Boroko, Papua New Guinea PROJECT DESCRIPTION: The project consists of construction and improvement, including bituminous paving, of 3 sections totaling ·about 68 kilometers (km.) of the Highlands Highway between Goroka and Garnigl; detailed engineering of some 317 km. between Waterais and Togoba (including the works mentioned • above); rural development project preparation studies in the Enga and Chimbu Provinces; a feasibility study for construction and improvement of the 63-km. road from Togoba to Wapenamanda to be followed by detailed engineering if warranted; and updating of the feasibility study of the Waterais-Togoba road in preparation for further improvements of the Highlands Highway; and technical assistance and training for local civil engineer- ing contractors by consultants. PROCUREMENT: Approximately 70% of the works will be carried out by con- tracts to be awarded after international competitive bi'd- ding in accordance with IDA guidelines. Approximately 30% of the works to be carried out will be by force account. CONSULTANTS: Consultants will supervise all of the works, assist in manag.ing. the force account works, an.d provide training for local civil engineering contractors. The hiring of consultants will follo~ normal 1nA guirlelinAs. ECONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: 27% September 1980 • - 0 -