Infrastructure, tourism development and basic services for southwest Potosi province

(La Paz, April 19, 2011).- Enrique García, president & CEO of CAF - Latin American development bank - signed a loan agreement for US$104.3 million with Bolivian Planning Minister Viviana Caro to finance the Uyuni-Huancarani-Cruce Condo "K" highway which will connect localities in Potosi province with the Basic Road Network and neighboring countries.

This loan completes a CAF integrated support plan for the region which includes construction of the Uyuni-Potosí highway, a Tourism Development Strategy for Salar de Uyuni and Lagunas de Colores, and a Program to upgrade the Basic Services Infrastructure of the Salar tourism circuit.

The signing took place at an official ceremony held today in Salar de Uyuni in the presence of Bolivian President Evo Morales, ministers of state, the governors of Potosi, Felix Gonzalez, and Oruro, Javier Santos Tito, residents of the region and other local authorities.

At the ceremony, President Morales thanked CAF for its support for road projects in the country. He said this route was evidence of the intention to make Uyuni into an ​​national development area, as reflected in the strong investments in the department and the region.

For his part, García said CAF strongly supported the development process of its member countries with a focus on integration. "In this context, we are constantly trying to supplement the financing of road infrastructure with projects to improve productive and commercial conditions in the region with a direct impact on quality of life of the inhabitants."

The CAF chief said the 167-kilometer Uyuni Huancarani Condo "K" highway would connect mining, agriculture and tourism areas with the main western route and with trans-oceanic corridors and facilitate access to Salar de Uyuni, which is emerging as one of the country’s most important sources of income because of its great tourism potential and lithium reserves.

"CAF is supporting construction of the Potosí-Uyuni highway because we believe Salar de Uyuni has a potential impact similar to other modern wonders of the world which can produce significant qualitative changes in the region and country."

García added that CAF was also providing non-reimbursable cooperation funds for preparation of a development strategy for Salar de Uyuni and Lagunas de Colores to strengthen tourism activity in relation to these attractions. This project complements the program to upgrade the basic infrastructure of the circuit, which the institution is currently backing with the aim of raising the quality of the services infrastructure to align with the needs of the population and the growing influx of tourists which generates economic return to the communities and enterprises in the area.

The highway The project for upgrading and construction of the Uyuni-Huancarani sections in Potosi department, and Huancarani-Cruce Condo "K" in Oruro, will create new opportunities for people in the area of ​​influence of the routes. The introduction of a competitive transport system will open the way for an efficient flow of tourists and more fluid movement of people and agricultural and mineral goods to the free ports of Chile and Peru.

The project, which will be implemented by the Bolivian Highway Administration (ABC), requires a total investment of US$122.25 million, of which 85% will be financed by the CAF loan and the remaining 15% or US$17.9 million by local counterpart funds.

Integrated support projects

• The 201-kilometer Uyuni-Potosí highway is currently being built with a US$75 million loan from CAF and complements projects which stimulate agricultural production, as well as improving the environment by recovering marsh and wetlands used for pasture in order to improve their capacity for camelid livestock.
• The Salar development strategy, which was developed with the participation of all stakeholders in the tourism sector, mainly local and national communities and institutions, was presented to the Ministry of Culture and the Potosi government for implementation.
• The program to upgrade the basic services infrastructure for the Salar circuit will produce the general design of the investment plan and technical studies for implementation and upgrading of water supply, sanitation, solid waste management, electrification and telecommunications. In addition, a technical assistance program is under preparation for infrastructure maintenance which will benefit the nine municipalities in the circuit (Llica, Tahua, Colcha K, San Pedro de Quemes, San Pablo de Lipez, Mojinete, San Antonio de Esmoruco, San Agustín and Uyuni).