News Releases

Apr 2, 2006

Peru, IDB sign $50 million loan to strengthen secondary roads system

Project will develop capacity of decentralized regional governments

BELO HORIZONTE, Brazil – Peru’s Minister of Finance Fernando Zavala Lombardi and Inter-American Development Bank President Luis Alberto Moreno today signed a $50 million loan to support a program designed to improve the system of secondary roads in the framework of the country’s decentralization process.

The resources will benefit the secondary roads network in the country’s 24 regions that will sign agreements with the Ministry of Transport and Communications to undertake a program to enhance their regional institutional capacity for road rehabilitation and maintenance, adopting specified environmental, technical and managerial standards

A priority will be assigned to maintenance of 2,700 kilometers secondary roads that have been transferred to the regional governments and to rehabilitation of 2,200 kilometers of roads, raising the roads in good condition from 5 percent to 35 percent.

The regional governments, responsible for the secondary roads, will be committed to adopting standards of planning, citizens’ participation, maintenance, outsourcing to microenterprises and environmental and social protection. The regional governments will also be committed to making their own resources available to support the program, thus providing to the sustainability of the secondary roads management.

In two previous lending operations beginning in 1996 the IDB provided $140 million in financing to support the rehabilitation and maintenance of rural roads. The projects resulted in successful demonstrations of the effectiveness of citizens’ participation in the planning and execution of projects and the deployment of microenterprises for construction and maintenance.

Secondary roads play a critical role in providing an outlet for agricultural products and other commerce and communications, improving physical accessibility of rural population and small towns to major cities and markets, thus raising the incomes and opportunities of the poorest segments of the population.

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