Announcement of Ninety Million US Dollars Loan for Mexico City Water Supply Project on June 14, 1973

INTERNATIONAL BANK FOR .RECONSTRUCTION AND DEVELOPMENT 1818 H STREET, N.W., WASHINGTON 0. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank Press Release No. 73/39 Subject: $90.0 million loan for Mexico June 14, 1973 City water supply project • The World Bank has approved a $90.0 million loan to assist a $194 million water supply project for the Mexico City metropolitan area. This is the first Bank-assisted potable water project in Mexico. The Mexico City metropolitan area's population is growing at almost 6% annually, and should this rate be maintained would rise from the present 9 million to 15 million by 1980. The water requirements of the metropolis for a growing populati.on and expanding economic activity are projected to increase from the current 55 cubic yards per second to 75 in 1977 and 85 in 1981. The prc,.}ect will augmerit the present supplies with 20 cubic yards of water per second and meet the requirements through 1977. The recently established public agency, the Comision de Aguas del Valle de Mexico, is in charge of developing all new water projects in.the valley and will execuieand administer the project assisted by this loan. Five groundwater and one surface water supply schemes make up the project. One of the roundwater sub-projects, Texcoco, will include a multipurpose land reclamation, afforesta- • ion and irrigation scheme, which will help reduce air pollution in Mexico City. This sub- project will, moreover, help transform the existing desert area in the Texcoco region into parks and make available land for urban and agricultural use. Additionally, each sub-project will include s·ome public works, with a social orien- tation. Among these are schools, health centers, roads and other facilities which will largely benefit the poorer people in the region. The project is expected to 'bs completed by the end of 1976. It will be supplemented by the construction of related m1ter distribution facilities and drainage and sewerage works financed by a $408 million inves.tmemt being made by the Federal District and the State of Mexico. The Bank loan is being made to NacionalF:i.nanciera,. S.A., the Mexican Government agency authorized to borrow abtroad and will kave·the guarantee of United Mexican States. The loan is for a term of 24 years, including four· years of grace, with annual interest at 7~ per annum. Algemene Bank Nederland N.v., Amsterdam, and Wells Fargo Bank N.A., San Francisco are participating in'the Bank loan for a total amount of approximately $550,000 equivalent. - 0 - •  Jwe 14, 19 73 • TECHNICAL DATA • PROJECT: Water supply COUNTRY: United Mexican States TOTAL CX>ST: $194 million (including capitalized interest during construction -- $19 million -- and incremental working capital -- $20 million). BANK FINANCING: $90.0 million, 24 years, 4 years of grace, interest at 7~% per annum. OTHER FINANCING: Other loans, $36 million; Government contributions, $24 mil- H.on. IMPLEMENTING ORGANIZATION: Comision de Aguas de! Valle d.e Mexico, Ayuntamiento 146, Mexico, D.F. PROJECT DESCRIPTION: The project includes five groundwater schemes (one of • which -- Texcoco -- is also a multipurpose resource development and environmental improvement scheme), one ~furface water scheme and mis- cellaneous public works. It has the primary objective of improving the water supply for the Mexico City metropolitan region. The groundwater schemes consist of well fields with an aggregate yield of about 17.7 cubic yards per second, located from 9 to 43 miles from Mexico City, and transmission mains to the metropolitan area. The surface water scheme includes a 1.5 cu. yard per second water treatment plant, about 12 miles of transmission mains and two storage reservoirs. In addition to the construction of a 1. 3 cubic yar1i'; per second w~ll field, the multi- purpose scheme includes a waste water treatment plant for agricultural and industrial reuse of water, irrigation facilities for a 10,000 acre area, drainage and channelization works, facilities for the extraction of salt from saline waters, and land afforestation. The public works include schools, health-care buildings, roads·and similar public facilities. PROCUREMENT: Equipment and supplies for well~, pumping stations, transmission mains, service reservoirs, water and waste water treatment plants, chlorin- ation facilities, irrigation systems, salt extraction, roads and bui-ldings. The services to be provided are for civil works and afforestation. All equipment and civil works, with the exception of those related to afforesta- tion, land reclamation and social type of public works, will be procured by international competitive bidding. CONSULTANTS: Most engineering work will be dQne by the implementing organiza- tion. Consulting specialists will be selected during the ext!cut:ton of • ._ the project. ESTIMATED COMPLETION DATE: December 19 76. - 0 -