Announcement of 16.5 Million Dollars Loan to Colombia for Highways held on June 6, 1956

t -HOLD OR RELEASE WOIILD .INTERNATIOI\JAL BANK FOR RECONSTRUCTION AND DEVELOPMENT 1818 H STREET, N.W., WASHINGTON 25, D. C. TELEPHONE: EXECUTIVE 3-6360 PP.ESS RELEASE NO. 446 SUBJECT: $16.S million.loan to Colombia f'or highways FOR RELEASE 5:30 p.m. June 6, 1956 The World Bank today made n loan of $16.5 million to Colombia to complete a program to rehabilitate the principal highway-s. First begun in 1951., the program has since been considerably revised and expanded to keep, pace wi.th the extremely rapid growth of traffic on Colombian roads. It is the third such loan made by the Bank to Colombia, and brings the total of lending for Colombian highway improvements to ~47.3 million. • The benefits to Colombia of ilnprovements in the highways are already becoming apparent. Prolonged traffic interruptions., due to torrents and landslides, have been virtually eliminated. Better alignment, more gradual gradients, increased width, and the pavi..,ng of road surfaces have reduced the time taken by road trans• portJ in many cases from days to a few hours, and lowered transportation costs. The original prn~am to rehabilita.te about 1.,900 miles of Colombia's princi~ pal highways was U:."'lderta.ken in 1951 to provide good road transport between the larger cities and the principal ocean and river ports. Because the existing highways were in serious disrepair and i.~proved roads were of pressing importance to the economy., work was concentr2.ted at first on prov:i.ding passable gravel roads, paved only on the more heavily traveled sections; the development of first-class highiirays was to be undertaken gTadually over a longer period. ,. The imrn.ediate rise in traffic accompany:tng the road improvements, however., soon made tt apparent that gravel roads could not meet even current needs. 1953., there:fore, at the time of the Bank's second highway loan to Colombia., it was In decided to increase the proportion of pav~d roads to 85%, to acquire more earth• moving equipment., needed particularly to modify mountain gradients and curves., and  '!92• to establish a comprehensive and continuing road maintenance program. The .; ncrease in traffic continued to be une,c;pectedly high. Between 19.52 and 195.5, for example, the volume of traffic has doubled over most of the roads and more than tripled near large cities. On the main highway crossing the ceni:J:'al mountain range, daily traffic has multiplied tenfold., from 220 vehicles to over 2,200. The registration of motor vehicles rose from 65,000 to 140,000, with trucks and buses accounting for the greater ppXt of the increase. As a result, further revisions became necessary in the standards to which the principal roads were being constructed. Today's loan will finance the additional foreign exchange costs of the equip- ment, materials., and services needed for the increased construction work required by the new standards. In addition, Bank-financed equipment ·will be used t·o build a new 40-mile road between Cienaga and Barranquilla on the Caribbean coast. This • road will co:ri..nect with the .Atlantic (Hagdalena VeJ.ley) Railroad which is being built with the assist.P..nce of other ~forld Bank loans. Improvements to t,he principal highways and the new Cienaga-Barranqui.lla road will be finished in 1958. The total cost of the e:-atire program is now estimated at 515 million pesos including 118.5 million pesos ($47.,350.,000) of foreign ex- change provided by the Banl< loens. The present loan is for a term of 15 yea+s and bears interest of 4-3/4% includ• ing the statutory 1% commission charged by the Bank. Amortization will ·oegin on May 15, 19590 The Bank has now made 11 loans in Colombia., totaling the equivalent of $111.2 million. Of the earlier loans, $13 million were for electric power development, $10 million for agriculture., $h0.9 m:i.llion for the Atlantic Railroad, and $30.85o,or for the national highways. • After having been approved by the Bank's Executive Directors., the loan docu• ments were signed today by His Excellency, Senor Don Francisco Urrutia Holguin, Colombian Ambassador to the United States on behalf of his Government, and by PJ!'. Robert L. Garner, Vice-President, on behalf of the Bank.  MAP OF PROJECT ROADS COLOMBIA PROPOSED NATIONAL ROAD NETWORK ROAD ROADS IN PROJECT: RAILWAYS, EXISTING * __ ........ RAILWAYS, UNDER CONSTRUCTION OR PROPOSED PROPOSED ROAD SCALE: I"= 130km. • -----t...J,..,.----""---- \ 'I \ '----, I \ ) ,,I • i.._ MAY, 1956 IBRD-218R