Contacts: In Colombo:Chulie De Silva cdesilva@worldbank.org (94-11) 5561-323 In Washington:Erik Nora (202) 458-4735 enora@worldbank.org WASHINGTON, July 17, 2008 ─ The World Bank today approved a US$98 million IDA credit in additional finance to support the Government of Sri Lanka’s efforts to improve its national highways, designed to lower transportation costs and travel times. The additional financing to the Road Sector Assistance Project, an IDA credit of US$100 million approved by the Bank in December 2005, will continue to support rehabilitation of national roads. The additional finance will be mostly used to cover cost-overruns mainly due to the unprecedented oil price increase in the world market that has led to the escalation of prices in oil-based materials. National roads carry over 70 percent of the traffic in the country and are vital for the movement of people and goods. However, uncontrolled roadside development, years of neglect and poor road maintenance, have resulted in low travel speeds and poor levels of service, discouraging long distance traffic and hindering the spread of economic activities and development away from the Colombo Metropolitan Area. “An efficient national road system is crucially important to boost economic growth and reduce regional inequality in Sri Lanka,” said Naoko Ishii, World Bank Country Director for Sri Lanka. “This project will help farmers transport their produce to markets on time, increase export competitiveness and accelerate export led growth, and contribute to sustained economic development.” So far the project has improved 150 km of national roads, and it is on track to meet the goal of reducing highways in poor condition from 52 percent in 2005 to 35 percent by 2010. “The project has made good overall progress,” said Amali Rajapaksa, World Bank Infrastructure Specialist and project leader. “Importantly, it has played a pivotal role in securing a mechanism for financing the maintenance of national roads which have suffered from a backlog of maintenance for several years.” The credit from the International Development Association (IDA), the World Bank’s concessionary lending arm, has 20 years to maturity with a 10-year grace period. The project is expected to close in 2011. For more information about World Bank activities in Sri Lanka, visit: www.worldbank.org/lk For project information, visit: http://go.worldbank.org/JWN4R70IL0 |
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