Major investment to improve economic prospects and travel times.
The Inter-American Development Bank (IDB) has approved a $114.3m loan to improve and maintain roads in Peru, reduce transport operation costs and improve travel times.
One of the challenges Peru faces in its efforts to promote economic diversification is the low quality of its departmental road network , which raises freight costs and hampers productivity and exports. This in turn has a significant effect on the economic prospects of many of its regions.
The IDB reported in detail on the issue of Latin American transport interconnectivity in 2020, setting out the need for improved infrastructure to help strengthen regional value chains and boost sustainable employment over time. This funding is a part of plans to help overcome the challenge.
The new programme includes interventions across 2,387 km of roads to improve regional access to major logistics corridors and strengthen resilience again natural disasters and climate change effects. The outcomes should also result in a rise in the general quality of roads in Peru and reduce inequalities through the generation of large numbers of jobs.
As part of the package, measures will also be taken to strengthen regional government institution involved in the road network. Of the programme’s 4.1 million direct beneficiaries, 51% are expected to be women, 11% people with disabilities and 52% will be people of native origin.
The loan is for a 15-year term, with 6.5 years of grace and an interest rate based on LIBOR.