Announcement of Nine Million Six Hundred Thousand Dollars IDA Credit for a Second Highway Project in Somalia on January 24, 1972

• INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 IDA Press Release No. 72/7 Subject: $9.6 million IDA credit for a January 24, 1972 second highway project in Somalia The International Development Association has approved a credit equivalent to $9.6 million to help finance a second highway project in Somalia. The African Development Bank is participating in the project by providing a loan of $1 million. The project will give further support to the task of raising the standard of the road transportation system to provide adequate communication in the areas of eco- nomic development in Somalia. Somalia'"; transport system is in the early stages of development and many areas are inaccessible to motor vehicles for much of the year. Raising the stan- dard of the roads system is essential for communication within the widely separated economic and population centers. The present road construction projece which is de- signed to meet the needs of the Northwest Region, is based on a feasibility study and detailed engineering financed by UNDP and the African Development Bank under the •• first highway project with the World Bank as executing agency • The main beneficiary of this road project is the livestock sector of the economy. Somalia is essentially a stock-raising country; about three-fifths of her population are nomadic and depend upon livestock production for their livelihood. Livestock accounts for two-thirds of Somalia's total export earnings and about 60% of this traffic moves along the project road. The journey now takes about five days and the improved road will reduce this to about five hours and animals will arrive in better condition. The project includes construction of about 100 miles of all-weather surfaced highway linking Hargeisa, the.main city in the north, with the port of B~rbera on the ~ulf of Aden, feasibility study and engineering of the 88-mile Hargeisa-Borama road with a 12-mile spur to Tug Wajale and technical assistance for transportation planning. Implementation of the project will be the responsibility of the Civil Engineer- ing Department of the Ministry of Public Works and the total cost including contin- gency allowances is estimated at $10.6 million. The IDA credit includes provision of $7.0 million for the foreign exchange component and $2.6 million for local costs, with ADB providing the balance of remaining foreign and local costs. The borrower is the. Somali Democratic Republic and the IDA credit is for 50 years including a 10-year grace period. It is interest free except for a 3/4 of 1% service charge to meet IDA's administrative expenses • • - 0 -  • January 24, 1972 TECHNICAL DATA PROJEcr: Second highway project COUNTRY: Somali Democratic Republic IDA FINANCING: $9.6 million equivalent credit, 50 years, 10-year gracP. period, 3/4 of 1% service charge. OTHER FINANCING: Loan of $1.0 million under a joint agreement from the African Development Bank. IMPLEMENTING ORGANIZATION: The Civil Engineering Department of the Ministry of Public Works (MPW). Address: Undersecretary for Public Works, Ministry of Public Works, Mogadiscio, Somalia. PROJECT DESCRIPTION: Construction of all-weather surfaced highway from Hargeisa to Berbera and consulting services for, (i) assistance in the prequalification of contractors; (ii) supervision of consturction; (iii) preparation of a feasibility study and sub- • sequent detailed engineering of the Hargeisa-Borama highway with a spur to Tug Waj ale and (iv) technical assistance in transport planning. PROCUREMENT: Civil works and consulting services. Construction will be by contract awarded after international competitive bidding in accordance with Bank/IDA guidelines. CONSULTANTS: Consultants will be required for preparation of a feasibility study and detailed engineering, and two transport experts will be required to work with MPW for about one year to assist the Government to formulate a transport plan. ESTIMATED COMPLETION DATE: 1975 - 0 - •