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Brazil: World Bank Approves US$130 Million for the Second Phase Sao Paulo Metro Line 4

May 4, 2010

WASHINGTON, May 4, 2010 - The World Bank approved today a US$ 130 million loan to support the Second Phase of the São Paulo Metro Line 4, which will improve public transportation and ease traffic congestion, while protecting the environment in the state of Sao Paulo.

In addition to improving metro’s overall quality of service, the project will also link key employment and service areas of the city and reduce travel times by building a new station and 1.5 km (one mile) access tunnel. Additionally, the Bank’s funding will help completion of four other stations, further promoting integration between Metro and other public transport modes in the area.

"The Metro Line 4 is a key part of the State strategy of prioritizing rail passenger transport as a way to improve traffic, reduce pollution and improve the quality of life of our population. When complete, it will be the integration line, reducing distances and reducing crowding in the other existing lines,” said the Governor of São Paulo, Alberto Goldman.

Once the second phase is completed in 2013, Line 4 is expected to increase Metro ridership by over one million passengers per day, to a total of 4.8 million. Line 4 is expected to carry some 700 thousand passengers by the end of 2010, when Phase 1 will be operating with all of its first six stations.

To achieve this while improving quality of service to the urban transport users, the project will help complete four stations initiated during Phase 1 (São Paulo-Morumbi, Fradique Coutinho, Oscar Freire and Higienópolis-Mackenzie), build one new station (Vila Sônia) and its access tunnel (1.5 km), build additional facilities at the Vila Sônia yard, and acquire and install the necessary systems to make these stations operational. Line 4 is operated by a private sector consortium, which financed the trains and signaling systems under the first PPP signed in Brazil.

“The Bank has been a long term partner of São Paulo in urban transport, and helped the State commitment to the area,” said Makhtar Diop, World Bank Brazil Country Director. “São Paulo’s integrated urban transport strategy benefits primarily low-income users, who make up more than 50% of the rail-based system passengers. The project will significantly improve urban mobility, economic competitiveness and ultimately the quality of life in the Capital.”, added Diop.

Specific structural and environmental studies for the new station and tunnel were undertaken, and constant monitoring of the works is part of the project requirements. A technical assistance component will support project management and studies, including estimating carbon emissions reduction due to the implementation of Line 4.

“The passenger and freight transport needs of the São Paulo Metropolitan Region, with its 18 million inhabitants, are enormous,” said Jorge Rebelo, Project Manager for the World Bank. “The second phase of Line 4 will allow better integration between the subway, commuter railway and bus networks thereby improving the level of service offered to the Paulistas, while  providing easier access to jobs, education, health and leisure facilities.”, he said.

Among the current and previous operations the project builds upon are: the First Phase of the Metro Line 4 Project (US$ 304 million total loans), the Trains and Signaling Project (US$ 550 million), the Integrated Urban Transport Project (US$ 45 million) and the recently approved Metro Line 5 Project (US$ 650 million).

This is a US$ 130 million, US$ denominated IBRD flexible loan with variable spread option, commitment-linked with all the conversion options repayable in 30 years with 5 years grace period. Since the first loan in 1952, the World Bank has invested approximately US$ 4.8 billion in São Paulo (including today’s loans).

Media Contacts
In Brasília
Mauro Azeredo
Tel : +55-61-3329-1059
In Washington
Gabriela Aguilar
Tel : (+1 202) 473-6768