IDB backs program to boost competitiveness in Paraguay's agriculture sector and economic integration

Road upgrades and conservation will benefit small- and medium-size producers and a population of 522,000 people

Paraguay will improve the competitiveness of its farm and livestock sector and its economic integration, particularly in the east of the country, with a road upgrade and conservation project backed by a $90 million loan approved by the Inter-American Development Bank (IDB).

The beneficiaries will be users of the highway grid, especially small- and medium-size producers, and a population estimated at 522,000 people, of whom 76 percent live in the countryside.

The goal of upgrading and conserving roads is to improve travel conditions, the level of service and safety on motorways that are part of the program in a bid to cut transport costs, travel time and the number of accidents.

The stretches of road included in the project are part of a major logistical corridor that connects areas of production in the east of Paraguay with places that process, transform and market the country's main export products, and with ports.

“The stretches of road that will be improved have been designed to be resilient to the effects of climate change, particularly heavy rain. Moreover, by improving the corridor with climate change considerations in mind, we will be strengthening the road network of the Oriental Region of Paraguay and consolidating a route that will be more resistant to flooding“, said Ernesto Monter, Project Team Leader of the IDB.

The works that are scheduled include the paving of a stretch of approximately 90 kilometers between San Juan Nepomuceno and Route 6, which is key to national and international integration as it connects the south-central part of eastern Paraguay, where 54% of farm production is concentrated, with the so-called Hidrovía Paraguay-Paraná, where the country's main grain export ports are grain processing plants are located.

Furthermore, the extension of this corridor from Route 6 to the east will provide access to one of the main agricultural production and processing centers and the ports of the Paraná River.

The program will finance all work necessary to improve and conserve major roads in the east, including upgrading the technical features of existing ones and widening roads and building shoulders to bring them up to standard with other stretches along the corridor.

The project will also finance the construction of ring roads around three populated areas which will reduce heavy vehicle traffic in these communities, reducing noise, pollution and the risk of accidents. The project also includes the implementation of safety features such as pedestrian crosswalks and mechanisms to get cars to slow down.

The $90 million loan is over 23 years with a grace period of seven-and-a-half and an interest rate pegged to the Libor.