Announcement of Fourteen Million US Dollars Road Credit to Tanganyika on February 5, 1964

r. • INTERNATIONAL DEVELOPMENT ASSOCIATION 18 1 8 H ST R E ET. N. W , WA S H I N GT O l'J 2 5: D. C TELEPHONE EXECUTIVE 3-6360 IDA Press Release No. 64/1 Subject: $14 million road. credit February 5, 1964 to Tanganyika The International Development Association (IDA), an affiliate of the World Bank, today extended a credit equivalent to $14 million to Tanganyika for high- way development. The credit will h€lp to finance the construction or improve- ments of eight ma.in roads totaling 734 miles in length in various parts of the country. The roads are important both for production and trade as they serve areas now producing cash crops or areas with a potential for agriculture, the country's chief economic activity. As a result of the project there will be • better routes for a growing volume of traffic, lower transport costs, faster transpcrtation of agricultural produce to consuming centers and ports, and savings in road m.a.intenance costs. Tanganyika, with an area of 36o,OOO square miles, is a large but sparsely populated country. The wide dispersion of the population of 9.5 million re- quires an extensive transportation network. The railways serve only parts of the country and the road system is of primary importance. The present road system extends over 21,000 miles, of which nearly half a.re main roads serving as trunk routes between provincial centers and with neighboring countries. The quality of the main roads is very uneven, however, with paved or gravel sec- tions near the towns and long stretches between towns with only earth surracing. Attention is now being focused on eliminating gaps in the existing system and the road project being assisted by IDA is a step toward the construction of  ', '1 • - 2 - ~ interconn~cted highway system that can be used in all kinds of weather. The . works to be carried out on the eight roads include some realignment, the replace~ ment of a number of poorly sited and narrow bridges, improvement of drainage and the paving oi' certain sections. Three of the roads being improved are part of the main road system which radiates from the capital, Dar es Salaam on the Indian Ocean, and serves most of the CTajor towns and some of the most productive lands in the country. One of these roads forms part of the main trunk road between Dar es Salaam and the Southern Highlands, as well as beins paxt of the Great North Road between East and Central .A.frica. The two other roads will provide an all-weather paved route between Dar es Salaam and the agricultural area around Mt. KiliaBnjaro, better connections with the port of Tanga, and a road link between Dar es Salaam and Nairobi in Kenya. A fourth road in this part of the cormtry, from Dar es Salaam • to Kibiti, serves an area of established agriculture with a large capability of increu.r inG the production of 1~ice, fruits and vegetables to feed the fast grow- ing J)Dpulation of the capital. Two other roads being improved consist of a section of the Southern Trunk Road which extends from Port Mtwara on the Indian Ocean inland to Mbamba Bay on Lake Nyasa; and the road from Mbeya. to Itungi, at the northern end of Lake Nyasa. -- the main route by which foodstuffs are moved to feed the large number of laborers employed in the tea and coffee plantations in the Southern High- lands. The other roadc to be improved are located in northern Tanganyika in the vicinity.of Lake Victoria: one extends to the Kenya border and the other is located in the country's main cotton producing area. The project will l:;e executed by the Public Works Division of the Tanganyika Ministry of Con:munications, Power and Works, assisted by consultants on part of L: ,, \ • • - 3 - the work. The total cost of the project is estimated at the equivalent of $18.8 million. The IDA credit will finance the foreign exchange require- ments, estimated at about 75% of the total cost; the local currency costs will be met by the Government of Tanganyika. With the exception of one road, which is already being built by the Public Works Division, all the roads will be built by contractors selected on the basis of international competitive bidding; The roads are scheduled for completion by June 1967. The IDA credit of $14 million is for a term of 50 years. Repayment of principal will begin February 1, 1974 after a ten- /,;:,ar period of grace. Therea~er, 1% of the principal will be repayable annually for ten years and 3% will be repayable annually for the final 30 years. The credit is free of interest but a service charge of 3/4 of 1% per annum on the amount withdrawn ~ and outstanding will be made to meet IDA's administrative costs. This is IDA's second operation in Tanganyika. A credit of $4.6 million was signed in December 1963 to help finance a secondary school construction and equi.prnent project • •  TANGANYIKA HIGHWAY SYSTEM • UGANDA - Projecl rr,ods - Exlsllng poved road5 = Existing grovel roods - - - - - - - ou,~r existing ro•d• - Rnllwny• 0 25 50 75 100 MILES I I I I I / .,/ {; I I J I I I • Oce on •