Announcement of China Promotes Commerce Through Road Improvements in Two Provinces on June 13, 1988

FOR IMMEDIATE RELEASE eworldBank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 88/81 Contact: Richard Kollodge IDA NEWS RELEASE NO. 88/79 (202) 477-4507 CHINA PROMOTES COMMERCE THROUGH ROAD IMPROVEMENTS IN TWO PROVINCES WASHINGTON, June 13, 1988 -- China's Sichuan and Shaanxi provinces will be better equipped to handle increasing economic activity because of two government projects designed to improve roads between several important economic hubs and agricultural areas. The World Bank and its concessionary lending affiliate, the International Development Association (IDA), are assisting these projects with loans and credits totaling $175 million. The Sichuan project, supported by a $75 million loan and a credit of SDR 36.1 million ($50 million), includes construction of a road between Chengdu, the province•·s capital, and Cho_ngqing~ China's third biggest city and the largest economic and trade center· in southwestern China. The project will also upgrade rural roads in poorer parts of Sichuan and address several institutional and.technological problems in areas such as road planning, paved-road maintenance, highway research and training. The Shaanxi project, being supported by a $50 million World Bank loan, will provide new road capacity in the corridor between Sanyuan and the city of Tongchuan, an important coal-mining area. This project also includes a program to improve rural roads and measures to strengthen the institutions responsible for highways. The World Bank loans are for 20 years, including five years of grace, with a variable interest rate, currently 7.72 percent, linked to the cost of the Bank's borrowings. They also carry an annual c0Im11itment charge of 0.75 percent on the undisbursed balances. The IDA credit is for 35 years, including 10 years of grace; it carries no interest, but has annual charges (0.5 percent on the undisbursed balances and 0.75 percent on the disbursed balances). Note: Money figures are in U.S. dollar equivalents. IDA credits are denominated in SDRs (Special Drawing Rights), which are valued on the basis of a "basket" of currencies. The U.S. dollar equivalent • of the SDR amount of the IDA credit reflects the exchange rates existing at the time of the negotiation of the credit.