Mozambique: US$ 44 million from ADF to Montepuez-Lichinga Road

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Tunis, 27 October 2006 – The African Development Fund (ADF) is supporting the rehabilitation and maintenance of the Montepuez – Lichinga road corridor in Mozambique with a loan of 30.10 million units of account (US$ 44.4 million or 1.15 billion Meticais), approved today by the Fund’s Board of Directors.

This road traverses the two relatively underdeveloped and isolated northern provinces of Niassa and Cabo Delgado which are part of the hinterlands of the Port of Pemba. The road corridor is important since it improves connectivity of the two provinces to the national road system; opens up the richest but underexploited agricultural region of Mozambique for grains and cash crops (tobacco and cotton); and improves social service coverage to the population in its remote rural communities.

The project comprises civil works for the upgrading of Montepuez-Ruaca (135 km) and Marrupa-Ruaca (68 km) road sections from gravel to bitumen surfaced standard; the rehabilitation of the Litunde-Lichinga road (66 km); the construction of seven bridges between Marrupa and Litunde through a joint ADF/JBIC funding. The project also includes consultancy services for road safety sensitization through a parallel funding by SIDA.

The project will impact positively on the rural communities in the short term through the creation of employment opportunities during project implementation and in the medium to long term improve economic activities by reducing transport costs and also provide improved access to markets and social services and integration of the remote rural population of the provinces of Niassa and Cabo Delgado to the national economy. It will stimulate production through reduction of cost of inputs and increase prices of products that can now reach the urban centers. The project will be instrumental to the development of the port of Pemba in the transport chain, particularly for coastal shipping and the development of the hinterland.

The project will contribute to the government’s objective of poverty reduction not only through increased income for the rural population but also by providing improved access by teachers, health workers and an enabling environment for improved social infrastructure such as schools and health facilities.

The ADB Group operations in Mozambique started in 1970. To date, its commitments in the country stand at US$ 1.3 billion in 93 operations.

* 1 UA = USD 1.47637 = MZM 38.1649 as at 27/10/2006

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