Announcement of Mexico to Rebuild Highways with the Help of a Two Hundred Million Dollar World Bank Loan on May 31, 1984

FOR IMMEDIATE RELEASE lWorld Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. WORLD BANK NEWS RELEASE NO. 84/83 Contact: Ciro Gamarra May 31, 1984 (202) 477-5320 MEXICO TO REBUILD HIGHWAYS WITH THE HELP OF A $200 MILLION WORLD BANK LOAN Mexico will undertake a major highway rehabilitation project to eliminate congestion on national and toll routes and continue maintenance of rural roads. The World Bank will provide a $200 million loan to help the country complete the three-year highway program, which will cost $1.6 billion overall. Major investments in highway construction have been postponed for the past few years because of budgetary restrictions. Many deferred improvements will be initiated under this project. On sections of the national highway network, substandard pavement will be - upgraded, roads will be widened, and some paved areas will be extended. In those areas where highway traffic is greater, reaching betweeen 3,800 and 40,000 vehicles a day, the project will include the construction of bridges, urban bypasses and dual carriage ways. The rural roads budget has been increased substantially to cover the cost of rehabilitation and maintenance of the 80,000 kilometers of rural roads built in the last 12 years. Technical assistance will be provided for the Secretariat of Communications and Transport to help strengthen its newly organized Planning Directorate for all transport subsectors. The project will help finance a study of road user charges and assessment of the costs and benefits of road freight regulations. Most of the remainder of the financing for the project will be provided by the government. The Inter-American Development Bank is expected to contribute $45 million. The World Bank loan is for 15 years, including three years of grace with a variable interest rate, currently 10.08 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.75 percent on undisbursed balances and a front-end fee of 0.25 percent on the amount of the loan. Note: Money figures are expressed in U.S. dollar equivalents.