The Inter-American Development Bank today announced the approval of a $67 million loan to Paraguay to support the second stage of the National Rural Roads Program, which will upgrade the level of service on a substantial part of the priority rural roads network.
The loan corresponds to the first five-year phase of the second stage of the rural roads development program, which will consolidate the advances accomplished during the previous stage in both physical infrastructure and institutional strengthening. The new stage is divided into two five-year phases.
The resources will support improvements and maintenance activities on local roads in 17 zones classified as priority in terms of their capacity for production, mainly agriculture, in the eastern part of the country. The initiative will support year-round road serviceability, safety, and the adoption of environmental protection measures for approximately 6,000 kilometers of the local road network.
Among the other benefits will be an increase in the competitiveness of production and a rise in living standards.
The Ministry of Public Works will carry out the program through the Local Roads Office.*
The total cost of the first phase of the project is $89.5 million. Local counterpart funds total $22.5 million.
The IDB loan is for a 20-year term, with a five-year grace period, at a variable annual interest rate of 6.44 percent.
The Bank will consider providing an additional $80 million in financing for the project’s second phase.