Announcement of the Signing of Two Loans Between Peru and The World Bank Totaling One Hundred Thirty-Four Million Dollars on June 4, 1982

FOR, IMMEDIATE RELEASE ., :- ~ ~ # • -.\!\/orld Bank 1818 H Strt1et, N.W., Washington, D.C>20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE Contact: Ciro Gamarra JUNE 4, 1982 (202) 477-8034 PERU AND THE WORLD BANK SIGN TWO LOANS TOTALING $134 MILLION The Government of Peru and the World. Bank today signed loan agreements for two development projects in that country totaling $133. 6 mil 1 ion. The loans, approved recently by the Bank's Board of Directors, consisted of $93 million for highway development, and $40.6 million for expansion of the water supply and sewerage systems in the capital city of Lima. In the Bank's fiscal year 1982, which ends this month, lending to Peru will have been the largest ever, with a total of six loans for almost $290 million. This will make Peru the fourth largest borrower in Latin America. • The highway development project, the eighth such project in the country supported by the Bank, will improve the main roads serving the Selva Central and the Rio Mayo areas in the jungle highlands. In both these areas, major rural development projects are underway, with bilateral assistance from various countries Including the United States, the Federal Republic of Germany, and the Netherlands.Improving these road links will provide better access to good farming land, of which there is a shortage in Peru. The loan wi11 ·also finance the rehabilitation of three deteriorated sections of highway and fund technical assistance for strengthening highway maintenance and for a series of important transport studies. 1 ................................................................!l"ll'!P-"!i~.... ro ect in Lima will provide ""'-o,l............11111111111m water and sewerage serv :es to some 0,0 persons, mainly in low-income areas. Another 610,000 people will have the opportunity to receive these services with an additional small investment. It will help finance distribution networks, expanded storage capacity,. house connections, sewerage works and the construction of new wells and rehabilitation of existing ones to increase Lima's water supply. Coflnanclng for this project is expected to amount to $7.7 million. The loans are repayable in 17 years, including four years of grace, at 11.6 percent interest per year. The water loan also carries an annual eomnitment charge of 0.75 percent on undisbursed balances, and a front-end fee of 1.5 percent on the amount of the loan. • NOTE : Money ffgures are expressed in U.S. dollar equivalents. ... / f r -2- The principal signatory for the Government was Javier Velarde, Minister of Housing and Construction. Nicolas Ardito-Barletta, the Bank's • vice president for the Latin America and the Caribbean region, signed the loan documents on behalf of the institution. The documents were signed at World Bank headquarters In Washington, o.c •. The cumulative total of World Bank loans to Peru is 1,114 million, including the loans signed today. 0 •