WB Helps Laos to Upgrade Rural Roads


The World Bank’s Board of Executive Directors is providing US$25 million credit for Laos to strengthen its road maintenance systems and improve road connectivity throughout the country.

The credit comes from the International Development Association (IDA), according to a report published on the World Bank’s Board of Executive Directors’ website on December 13.

The approved Laos Road Sector II Project is part of the country’s national programme to build climate-resilient infrastructure nationwide through a stronger institutional framework for road maintenance.

The project will help to strengthen the government’s capacities for sector financing, planning, integration of climate change adaptation into road sector strategies, business processes, standard designs for climate-resilient road asset management, governance and accountability, monitoring and evaluation.

We thank the World Bank for the assistance it has extended to help Laos fulfill its National Socio-Economic Development Plan, Minister of Public Works and Transport Dr Bounchan Sinthavong said.

Through this project, we are able to partner with the World Bank to support Laos’ road maintenance programme, resulting in better and safer roads. Many people in rural areas will benefit from more reliable roads, in both the dry and rainy seasons.

In addition, the project will support road maintenance in the six provinces of Phongsaly, Huaphan, Oudomxay, Xieng Khuang, Xayaboury and Borikhamxay, which are highly vulnerable to flash floods, landslides and other events as a result of severe weather.

Under the project, around 1.6 million people in these provinces will benefit from improved and more reliable roads, ensuring year-round access to basic services such as schools and markets, even during the rainy season. Laos is one of the Asean countries most vulnerable to floods, droughts and storms, with local transport infrastructure particularly exposed due to the climate-related increase in the frequency and intensity of natural disasters. Better roads can help Laos avoid disaster-related road closures, improve people’s mobility and access to basic services, markets and sources of livelihoods, World Bank Country Director for Southeast Asia Ulrich Zachau said.

The World Bank is pleased to help finance this project and support the Lao government’s goal to build stronger, safer roads to provide more services and more income opportunities for more people.

This project is co-funded with an additional grant of 5 million euros, credit of 6 million euros from the Nordic Development Fund and US$10 million from the Lao government. The terms for the IDA credit include a maturity of 25 years, with a grace period of five years and a service charge of 0.75 percent and interest rate of 1.25 percent.


Source: Vientiane Times