Announcement of Four Hundred Ninety Thousand Dollar Credit to Malawi for Road Engineering Services on September 23, 1966

• INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET, N.W .. WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 IDA Press Release No. 66/18 Subject: $490,000 credit to Malawi for September 23, 1966 road engineering services The International Development Association (IDA), an affiliate of the World Rank, has approved a credit equivalent to $490,000 f~r engineering services con- nected with improving two of the most important roads in Malawi. One road, which is part of ·the·country's main north-south artery, extends from Zomba, the capital, to Lilongwe, the major market center for agricultural produce from the rich Central Region. The other road extends westward from Lilongwe to the border of Zambia. • Malawi, a long, narrow landlocked country situated in the Great Rift Valley of eastern Africa, has a population of 4 million and an area of some 45,700 square miles. The transport system is generally inadequate for present traffic and the difficulties of transport hinder economic growth. There are 6,200 miles of roads of all types, of which only about 250 miles are paved. The most urgent require- ment is for the improvement of the 168-mile road between Zomba and Lilongwe. The IDA credit will finance the services of consultants who will carry out detailed engineering, including design and preparation of tender documents, of the Zomba-Lilongwe road~ The consultants will also review the detailed design, already prepared by Malawi's Ministry of Works, of the 90-mile section between Lilongwe and the Zambian border, and prepare firm cost estimates. In addition, funds from the IDA credit will be used to reimburse the Malawi Government for the ccGt of a study of alternative routes which was carried out last year at the re- ~ quest of the Association.  • - 2 - The Malawi Government has engaged the consultants who carried out the route selection study, Brian Colquhoun and Partners, of the ~nited Kingdom, to carry out the detailed engineering. The entire work is expected to take about 12 m~nths at a total estimated cost equivalent to $575,000. The IDt\ credit of $490,000 will cover the foreign exchange component and the Government of Malawi will meet the local currency costs. The IDA credit will be for a term of 10 years, with the understanding that if an IDA credit is extended in due course for the construction of the roads :f.n- volved, the engineering credit would be refunded out of the proceeds of the con- st~uction credit. After a two-year period of grace, repayment will be made in semi-annual installments beginning in October 1968 and ending in April 1976. 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 lt>A's administrative costs. • •