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Peru: US$150 Million to Rehabilitate and Maintain National Highways

January 14, 2010

WASHINGTON, January 14th, 2010 – The World Bank’s Board of Directors approved a US$150 million loan today aimed at improving the quality and sustainability of public investment in the transportation sector.  The operation will help to rehabilitate and maintain selected national highways, promote road safety and strengthen the Ministry of Transportation and Communication’s institutional capacity.

“This operation will streamline passenger and cargo transportation conditions along national road networks that are essential for Peru’s competitiveness”, Enrique Cornejo, Minister of Transportation and Communication, indicated.

The Safe and Sustainable Transportation Project aims at:

  • Improving the quality of selected national highways through increasing maintenance and an efficient rehabilitation that will reduce travel times, using of low-cost paving technologies;
  • Supporting a reduction in traffic accidents in selected national highways by developing safe road networks;
  • Strengthening the institutional framework for the Ministry of Transportation and Communication, with the purpose of improving the efficiency of the government’s stimulus package;
  • Generating employment opportunities, especially for the rural poor; incorporating them to road-maintenance activities.

“Through this project, we intend to support the government’s efforts to reduce traffic-related deaths, improving road safety conditions in Peru by developing safe road networks in selected national highways,” Felipe Jaramillo, World Bank Regional Director for Bolivia, Ecuador, Peru and Venezuela at the Latin America and the Caribbean Region, pointed out.

The proposal includes the following components:

1. The rehabilitation and modernization of highways will help to improve at least four national road networks (approx. 183 km [114 mi]) in the following sectors:

  • Ayacucho-Abancay Highway;
  • Llama-Cochabamba Highway;
  • Cochabamba-Chota Highway, and
  • Reither Bridge-Paucartambo Bridge – Villarica Highway,

2. Highway maintenance will cover 2.096 km (1.302 mi) of national highways through medium-term results-based maintenance contracts.

3. The implementation of road safety infrastructure will prioritize civil projects, in order to improve road safety in those national highways chosen for their high rates of traffic accidents.

4. Institutional support and strengthened transportation regulations for Provias Nacional and other bodies at the Ministry of Transportation and Communication, in order to improve road management practices, establish better regulations for transportation services and improve the management of socio-environmental affairs linked to road investments.

The US$150 million assistance package includes a variable interest rate (Libor), plus a fixed amount with a maturity period of 21.5 years and an 8.5-year grace period.


Media Contacts
In Lima
Sandra Arzubiaga
Tel : (511) 615-0660
In Washington
Gabriela Aguilar
Tel : (202) 473-4019