Announcement of World Bank Supports Mexico’s Highway Program on March 22, 1979

FOR IMMEDIATE RELEASE -World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 79/59 ·March 22, 1979 WORLD BANK SUPPORTS MEXICO'S HIGHWAY PROGRAM A World Bank loan of $120 million for a highway project will support Mexico's program to provide an effective transport network. The project will emphasize the maintenance and improvement of existing roads. The highway project is part of the Ministry of Human Settlements and Public Works (SAHOP) 's 1979-82 highway investment program, with a total cost of about $1. 1 billion. The total estimated cost of Bank-supported subprojects under this loan is $230 million. The project will help modernize, expand, and maintain the road network. It wi 11 also help assess the regional development impact of highway investments and the long-term perspectives of road transport. It will improve • coordination of sector policies and strengthen local capabilities to plan and manage highway sector programs. The loai will help finance the construct!0n, rehabilitation, and expansion of federal and state highways and urbar1 bypasses, the construction of SAHOP regional centers, and the purchase of maintenance equipment and vehicles. Mexico's highway sector carries some 90% of intercity passenger traffic and about 75% of intercity freight transport. About 14,000 kilometers (km) of the 43,000 km primary network in Mexico were built more than 20 years ago. Road development will continue to play a major role in the integra- tion of remote and underdeveloped regions of Mexico. The project wi 11 benefit the economy at large in the form of savings in vehicle operating costs. It will also generate indirectly employment opportunities in Mexico. The $120 million loan to the Banco Nacional de Obras y Servicios Publicos, S.A. (BANOBRAS) has the guarantee of the United Mexican States. It has a term of 17 years, including 4 years of grace, with interest at 7% per annum • • NOTE: Money figures are expressed in U.S. dollar equivalents. FOAM NO. 1121 (5-76) T E C HN I CA L DA T A PROJECT: COUNTRY: TOTAL COST: Highway Sector Mexico $230 million • BANK FINANCING: $120 million for a term of 17 years, including 4 years of grace, at 7% interest per annum. OTHER FINANCING: Government of Mexico IMPLEMENTING ORGANIZATION: Secretarfa de Asentamientos Humanos y Obras Publicas (SAHOP) Universidad y Xola Mexfco 12, D.F., Mexico PROJECT DESCRIPTION: It consists of: (i) construction, rehabilitation, and expansion of federal and state highways and urban bypasses; (ii) construction of SAHOP regional centers; (iii) purchase of mainte- • nance equipment and vehicles; and (iv) consultants' services. PROCUREMENT: Civil works and equipment eligible for financing under the loan will be procured through international compe- titive bidding in accordance with Bank guidelines. Civil works contractors will be subject to prequalification. Mexican equipment suppliers will receive a preference of 15% on CIF prices or the prevailing custom duty, whichever is lower. CONSULTANTS: Some 600 man-months of consultant services will be required to carry out the studies financed by the Bank • ECONOMIC RATE OF RETURN: n.a. ESTIMATED COMPLETION DATE: 1983 - 0 - •