ADB Loan Funds PNG Bridge Replacement

MANILA, PHILIPPINES (30 September 2011) – An Asian Development Bank funded project that focuses on bridge rehabilitation and replacement on national roads in Papua New Guinea (PNG) will improve road safety and connect remote rural communities to markets, health and education services.

The ADB Board of Directors has approved loan and grant funds equivalent to $90 million for the Bridge Replacement for Improved Rural Access Sector Project, which will replace 20-30 narrow, modular steel bridges on five priority national roads with permanent two-lane bridges. Some of the bridges due for replacement will be reassembled on rural roads, boosting access to urban centers.

The bulk of PNG’s population live in rural areas and the island nation’s rugged, scattered geography means the road network on the mainland is not fully connected. Lack of transport infrastructure is recognized by the government as a major constraint in PNG’s economic and social development.

“The project offers a comprehensive bridge replacement program with a strong focus on road safety,” said Hasan Masood, Lead Project Administration Specialist from ADB’s Pacific Department. “Reuse of existing steel bridges on rural roads will benefit 400,000 people in rural areas across five provinces.”

The project is the first phase of the proposed bridge replacement program and covers five of the 16 priority national roads identified by the government in their National Transport Development Plan. The priority roads are in the provinces of Central, Madang, East Sepik, and West and East New Britain.
The project will finance road safety campaigns in rural areas along the five priority national roads. These will include training for schoolchildren and communities in rural areas, complemented by media campaigns.

The relocation of existing bridges under the project will involve consultation with women regarding access to health facilities and schools. Both women and men will be engaged in semi-skilled labor for construction and bridge maintenance to provide jobs.

ADB’s assistance includes a $40 million, 25-year loan, from its ordinary capital resources with a five-year grace period and interest determined in accordance with its LIBOR-based lending facility. A further $50 million equivalent loan will be extended from ADB’s Special Funds resources. The loan has a 32-year term, including a grace period of eight years. Interest is charged at 1% per annum during the grace period and 1.5% per year for the rest of the term.

The Government of PNG will finance the equivalent of $10 million towards the total project cost of $100 million. It will be implemented over five years with PNG’s Department of Works as the implementing agency.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth and regional integration. Established in 1966, it is owned by 67 members -- 48 from the region. In 2010, ADB approvals, including co-financing, totaled $17.51 billion. In addition, ADB's ongoing Trade Finance Program supported $2.8 billion in trade.

ENDS

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