Announcement of Malawi to Receive Thirty-Three Million US Dollars IDA Credit for Highway Project on February 5, 1981

. , FOR IMMEDIATE REL~ASE •World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 IDA NE~/S RELEASE NO. 81/42 February 5, 1981 MALA\,.,il TO RECEIVE SOR 25.9MILLION IDA CREDIT FOR HIGHWAY PROJECT The International Development Association (IDA), the World Bank's soft-loan affiliate, has approved a credit of SDR~5-9 mill ion ($33 mil- lion) to Malawi for a highway project. This will be the fourth highway project assisted by IDA in the country. Under the project, to be implemented over five years, the major un- paved sections of the principal North-South road, between Ekwendeni and Jenda will be constructed (69 kilometers --km) and improved (100 km). This will help to develop the economic potential of the relatively less- developed Northern Region. In addition, the second phase of the District Road Improvement and Maintenance Program will be supported, extending the • program to 10 additional districts and covering about 2,600 km of district roads. Road maintenance equipment, training facilities, consultant services, and staff training will also be provided under the project. Road users in Malawi are expected to benefit from lower vehicle-operat- ing costs that will result from improved roads and maintenance. The bene- fits will be passed on to farmers, shippers, and consumers in the form of lower freight and passenger rates. Improved district roads are expected to help raise agricultural productivity by providing better access to farms and markets. The IDA credit is for 50 years, including 10 years of grace. It carries no interest but wil 1 bear a 3/4 of 1% service charge a year to cover IDA's administrative expenses. NOTE: IDA credits are denominated in SDRs (Special Drawing Rights), which are valued on the basis of a ''basket" of currencies. The U.S. dol- lar equivalent of the SDR amount of the IDA credit reflects the ex- change rates existing at the time of negotiation o~ the credit . •• FORM NO. 1121 (5-76) T E C H N I C A L. DA T A PROJECT: COUNTRY: TOTAL COST: Fourth Highway Malawi $39.2 million • IDA FINANCING: SOR 25.9 mill ion ($33 mill ion), standard IDA terms OTHER FINANCING: Government of Malawi, $6.2 mill ion IMPLEMENTING ORGANIZATION: Ministry of Works and Supplies Private Bag 316 Lilongwe 3, Malawi Cable: FTIUCTURE LILONGWE 3 PROJECT DESCRIPTION: The project will, over five years, finance: (i) the con- struction of a two-lane bituminous paved road between Jenda and Luwawa Turnoff (32 kilometers-km) and Mbowe and Ekwendeni (37 km), and improvement of the existing road between Luwawa Turnoff and Mbowe (100 km) to a low gravel standard; (ii) the second phase of the District Road Improvement and Main- tenance Program(DRIMP); (iii) consulting services and training; (iv) prov.i_sion of road. maintenance equipment; and (v) facilities in Lilongwe for training semi-skilled personnel in the Ministry of Works and Supplies. PROCU.REMENT: Civi 1 works contrat.:ts for road construction and improvements ($21 million) will be awarded on the basis of international competitive bidding (ICB) in accordance with World Bank/I DA guidelines. Contracts for other civil works consisting of depots, housing for staff, and new training center facilities ($2.5 mill ion), which, due to their small sizes and widely dispersed loca- tions, are not likely to attract ICB, will be awarded after local competitive bidding or constructed by force account. In order to train local staff in the districts, im- provement and maintenance works under DRIMP's second phase ($4.5 mill ion) wi 11 be done by force account. Equipment for maintenance of bituminous pavements ($140,000) and for the second phase of DRIMP($940,000) will be purchased through local shopping. CONSULTANTS: About 320 staff-months of consultant services will be re- quired as follows: 130 staff-months for supervision of road construction and improvement; 90 staff-months of technical assistance for implementation of the second phase of DRIMP and 15 staff-months for prepa·ration of the third phase; 55 staff-months to carry out a study of road maintenance needs; and 30 staff-months of technical support in transport planning. Consultants will be employed on terms and . conditions satisfactory to IDA . ECONOMIC RATE OF RETURN: 18% ESTIMATED COMPLETION DATE: 1985 - 0 - •