Announcement of Highway loan to Thailand on May 23, 1968

1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank Press Release No. 68/24 Subject: Highway loan to Thailand May 13, 1968 Thailand's large-scale program to improve its road system, which has become the country's most important mode of transport in the last decade, will be assisted by a World Bank loan of $29 million. However, in view of the present high level of Thailand's foreign exchange reserves, the Bank has reached an agreement with the Bank of Thailand under which the latter will take a $25 million participation in this loan. Additional smaller participations will be taken by seven private commercial banks in the United States. • Highway development in Thailand was accelerated in the early 1960s and by the end of 1966 the national network of primary and secondary roads had been increased by 1,250 miles to 6,400 miles and the length of paved roads had been doubled to nearly 3,350 miles. The number of road vehicles has more than doubled, with trucks accounting for the largest growth rate. Despite the growth of the road system, major imprpvements are needed.to carry the increasing traffic to be expected as the economy develops. The project being financed is part of a program the Government has had under way since 1965 which, over a 7-year period, calls for an investment of $400 million for the construction or reconstruction of about 2,800 miles of roads and the paving of another 2,000 miles. The project consists of the construction and improvement of two high priority highways totaling about 300 miles, which form part of the arterial links between Bangkok and the northern and northwestern regions of Thailand and cross some of • / more  - 2 - the most fertile egricultural lands of the Central Plain. The Bang Pa In - Nakorn Sawan highway will closely follow the east bank of the Chao fhraya, the •~ principal river of Thailand,:,and will be about 62 miles shorter than the present alignment. The construction of the Saraburi-Lomsak highwa.y on a new aligmnent will shorten the distance between these two towns by some 31 miles. Also in- cluded is the detailed engineering of about 405 miles of feeder roads which have been given priority, on the basis of a study previously financed by the Bank, because of their potential for agricultural development in the.areas served. The loan is for a tenn of 20 years, including a 4-1/'1.-year grace period, and bears interest of 6-1/4%. 'i\1:-·v; The p:roject is schedubd for completion in 4-1/2 ye..· .rs at a total estimated cost equivalent to about $60 m!llion. The loan will cover the foreign exchange costs of the road works, consulting services and the overseas training of senior staff from the Department of Highways. The balance of the funds required will be provided by the Government. Construction work will be carried out under unit price contracts awarded after international competitive bidding. The World Bank became associated with road development in T~ailand in 1963. Two loans, totaling $61 million, assisted in the construction of J,80 miles of primary roads, consultants' services for the reorganization of Thailand's Depart- • ment of Highways, technical training abroad of Thai personnel, and feasibility studies and engineering of futu:re projects. Assistance p.rovided under these earlier loans and from other sources has substantially increased the capacity of the Department of Highways to pl~n and carry out projects in the current program and to maintain the national highway system. Reorganization of the Department has been completed and planning and administrative procedures have been considerably improved. The program for .local and overseas training of Thai technical personnel is being expanded. The seven commercial banks which are pUrchasing a total of $475,000 of the first maturi,ty of the loan are The Fidelity Bank, Philadelphia First''National City Bank, New York Bank of America, New York ,,American International Bank, New York Marine Midland Grace Bank Trust Company, New York • J. Henry Schroder Banking Corporation, New York Union Bank, Los Angeles - 0 -  =::··· •• I·~. :··· ~• :·····;~~~ ! .........······· ••••••·•• •• ;° I\( ·:··· ····~..... ........: { ······ ···. .. '\······: '•.''-:.,L ... ...!---N 0 ·....... ·: : Mo. :.~ari1no ..... ... ........... ··..:, ····: i ••• ~... Tok· •,o ... - ' •, Mae Sod ':Kompoengphe ~..·-;: ..., •.. C ........... Chono \ '- Mek ,• ,,, ... Oejudo1':( ., · ... .......~.~~~~.:.;.:;.:-:,..... ·\_,:.:···· .. ··.................. ...· ran ~prodl!S '•,, • C A M BI O D A EXISTING NATIONAL HIGHWAYS - - - - Primary - - - - - - Primary under construction o,r proposed - - - - Secondary -+-i--+-i--+- Railways PROJECT HIGHWAYS - - - - - Construction and improvement { FIRST :S4l·TH ) PROJECT • • •••••• • Study and engineering l Construction. and improvement SECOND 455-TH PROJECT • • • ~ Study and engineering Construction and improvement THIRD • PROJECT - -+- Airports O 25 50 75 IOOl<m -==1 25 50 75 IOOMi APRIL 1968 1BRD·2144R