Announcement of Nine Million Dollars Credit for Senegal Railways on September 28, 1966

",. 1\1.(;,,. • INTERNATIONAL DEVELOPMENT ASSOCIATION {I)) 1818 H STREET. N.W .. WASHINGTON 0. C. 20433 TELEPHONE: EXECUTIVE 3-6360 IDA Press Rel2dse No. 66il9 Subject: $9 million credit for September 28, 1966 Senegal Railways The Inte·rnational Development Association (IDA), an affiliate of the World Bank, has approved a credit equivalent to $9 million to the Republic of Senegal for the rehabilitation and modernization of the railways. The main line of the ~~n0gal Railways connects with the Mali Railway, providing the principal route for Mali's export-import trade. Because of the interdependence of the two systems. the railway improvement project complements a similar one in Mali being carried • out with the assistance of an IDA credit of $9.1 million, also announced today • Senegal, with an area of 77,000 square miles, has a population of about 3.4 million. About a quarter of the people are concentrated in the area of Dakar and ~hies, the administrative, industrial and commercial center of former French West Africa. Dakar, the capital of Senegal, is one of the major ports of Africa and the terminal point of the Senegal Railways. Before independence the railways iii s~n~gal and Mali were operated under single management with headquarters and work·· sh~ps in Thies. The Senegal Railways were established as a separate entity in 1~60, taking over that part of the railway located in Senegal territory. They fan out from the Dakar-Thies area and comprise 645 route-miles; the main line runs 402 miles from Dakar to Kidira on the Mali frontier, and four branch lines connect with other towns and agricultural production centers. Mali traffic accounts for over half the Senegal Railways' total freig~t • revenue, and the Senegal Railways suffered considerable losses during 1900-63 when the rupture of relations between Senegal and Mali halted all traffic between the two countries. - 2 - Since the resumption of traffic in 1963, international traffic has been regulated by a Convention concluded between the two Railways, • which provides the framework for their continued close cooperation. In view of the financial and technical interdependence of the two systems, this is essential to the successful execution of the railway improvement projects in both countries. The project being assisted by the IDA credit comprises high priority items in the Railways' Four Year Investment Plan (1965-69). The purpose of the Plan is to improve efficiency, lower operation costs and provide the additional capa- city needed by the Railways to handle the expected growth of traffic. This will involve additional locomotives and rolling stock, improved signaling and tele- communications services and the renewal of track. Track renewal is particularly important because the poor condition of most of the track is causing frequent de- lays and on-line failures. The track renewal now to be undertaken is part of a ~ long-range plan that will extend beyond the four years. The IDA credit will help to finance the relaying of 81 miles of rail on a heavily traveled section of the mainline, completion of the doubling of track on the Dakar-Thies line, the welding and ballasting of about 92 miles of other lines, and the construction of a marshaling yard; the purchase of 7 diesel locomotives, 100 freight cars, 5 rail cars and 14 trailers; and the purchase of signaling and telec0111nunications materials and equipment. IDA funds will also finance the ser- vices of consultants to carry out a detailed traffic cost study and of technician[ to assist the Railways in the improvement and maintenance of track. These works, together with improved efficiency of operation and increased traffic freight traffic alone is expected to increase from about 1.4 million tons to 2.8 million by 1970 -- should enable the Railways to start making a profit in the near future. • •• - 3 - The project is scheduled for completion in mid-1969 at a total cost esti- mated at the equivalent of $13.9 million. The IDA credit will finance 65% of the total. Most of the remaining costs will be financed by the Senegal Rail- ways from its o,;m resources. The IDA credit will be for a tenn of 50 years~ Repayment of principal will begin in February 1977, after a 10-year period of grace. Thereafter, 1% of the principal will be repayable annually for 10 years and 3% will be repay- able annually for the remaining 30 years. The credit will be free of interest, but a service charge of 3/4 of 1% per annum on the amount withdrawn and out- standing will be made to meet IDA's administrative costs. The Government of Senegal will re-lend the proceeds of the IDA credit to the Senegal Railways at 6% interest, repayable over 30 years including a grace period of three • years • •  RAILWAYS 11AIN PAVED ROADS To Nouok(holt e • e • • •• • PAVED RvAOS UNDER SENEGAL RAILWAYS so 100 150 200 Miles "-, 1 \\ !l,J~fl'f~[M fl~ 1M) ~ ,,·""\. ( l I I ' i I s E N E G A L Bokel 0~ ~ ./ _) ·~ -·"" GROUNDNUT CROP CE:NTERS \ I ;~ (. ~ I \ i ~; 'l !Ml A . __ i -·'"" '. ,-.. . _~ -~°";,.<. _ .--;.: ;:.I\ \ ~/ ~ \ Miss;~~o •~CJf ' ·, .-::: ,Y~ o Oiolokoto \ _.J ........ / \ ·-·"·\. . - CASAMANCE ·-·-;· \ o N1okolo-Kobo . Velingoro , \v. ·-. ~-"'--- ~ \ ~ ~ __ -- G • 1 s,dh1o1, -c:=:!) ~ . .,,.,. ..,,,,_ ..... .._. __ .,,,, Ziguinchor .,, .,,. --"' oKo<do ... · _ · - · - · - · - · - · -·-·-·y-·-·- __ .,,, . 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