World Bank Document

• ~ INTERNATIONAL BANK FOR • RECONSTRUCTION AND DEVELOPMENT 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Public Disclosure Authorized Bank Press Release No. 65/43 Subject: $25 million loan in Japan September 10, 1965 for Kobe Expressway The World Bank has approved a loan equivalent to $25 million to assist in financing a 7.8-mile elevated toll expressway in Kobe, Japan. This is the seventh loan to be made by the Bank for Japan's exp~essway system. Earlier loans totaling $305 million are paying part of the cost of the Tokyo-Kobe Expressway and the Haneda· Yokohama urban expressway in the Tokyo metropolitan area. The Kobe Expressway wilt Public Disclosure Authorized relieve congestion on city streets, speed up travel time and reduce transport coots, as well as provide a fast route for through-traffic that has to traverse the city in both easterly and westerly directions. • The loan will be made to the Hanshin Expressway Public Corporation, a government: agency established in 1962 with responsibility for the construction.,, CJ}eration and maintenance of toll facilities in the Hanshin region, a metropolitan complex comprising the cities of Osaka, Kobe, Amagasaki, Nishinomiya and Ashiya. The Hanshit: Public Disclosure Authorized region is one of the most industrialized areas of Japan and second only to the Tokyo Yokohama region in economic importance. The project. being assisted by the loan announced today is part of a 32.3-mile network of elevated urban expressways in the Osaka-Kobe area which the Corporation plans to construct ~ta total cost of 135 bil lion yen ($375 million). One section in Osaka is already in service and a priority section in Kobe is under construction. Kobe is the fifth largest city in Japan; as the second largest port it handles Public Disclosure Authorized 30 million tons of cargo annually and is the most important outlet for exports. The population, now 1.2 million, has been growing at more than 2l annually, about twice ~ the national average growth rate. The number of registered motor vehicles in Kobe .. - 2 - hes increased mo~e than sixfold in the last ten years and now exceedo 100,000. Kobe is situated on a narrow strip of land between the mountains and the sea, and three • main streets following east-west routes constitute the backbone of the city's road system. These streets have been widened section by section in recent years, but wil~ still become inadequate within a few years unless additional facilities are con structed. Furthermor';?, traffic now cannot move faster than about 12 miles an hour. The new expressway will enable vehicles to go more than twice as fast and will per mit higher speeds on existing streets by relieving congestion on them. Also, ve hicle operating costs on the expressway will be reduced by about 40%. The Kobe Expressway will be an elevated, four-lane, divided, limited access toll expressway extending·7.8 miles from the western outskirts of the city to the eastern. For nearly 70% of its length it will be built as an elevated viaduct above existing city streets which are being widened to accommodate the ramps and toll facilities. Sections of the expressway between ramps will be opened to traffic as • they are completed; the expressway should be open over its entire length by early 1969, at which time it is expected to carry an average of 22,600 vehicles daily. In subsequent years it is expected that between 80,000 and 100,000 vehicles will use the expressway daily. The total cost of the project, including construction, right-of-way, administra· tion, associated street impiovements, and interest during construction, is estimated at the equivalent of $84 million. The Bank loan will cover about a third of the total; the remainder will be financed by the Corporation from domestic loans and by Government and municipal funds. Opportunities will be given for international com petitive bidding on appropriate parts of the superstructure, involving the fabrica tion and erection of about 16,500 tons of steelwork in viaducts, bridges and steel piers. Toll revenues will be ~ufficient to pay for working costs, administrative • • - 3 - • expenses and redemption of construction debt and subscribed capital in about 25 years if traffic develops as forecast. The Bank loan will be for a term of 24 years and bear interest at the rate of 6-1/2% per annum. The standard interest rate of Bank loans remains at 5-1/2%; the higher rate of this loan is in accordance with a policy which was adopted recently by the Bank of charging higher interest rates to countries which normally cover their external capital needs mainly in private capital markets. Amortiza tion will be 5in November 1, 1969. The loan will be guaranteed by Japan • • • .

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