RAILWAYS VII

closed

The Seventh Railway Project focuses on the goals set jointly with the Government for Bank participation in the sector, namely to increase the capacity of the transport system in the most economically efficient way and to develop and strengthen the institutions dealing with the transport sector. The main component of the project is the 1980-81 part of KNR's 1977-81 investment plan which aims at: (a) initiating the institutional changes necessary to gradually tranform KNR into a public corporation; (b) providing KNR with the capacity required to meet forecast traffic; and (c) reducing operating and maintenance costs. The proposed loan with finance rails, track maintenance equipment, breakdown cranes, passenger cars, freight cars, workshop equipment, technical assistance and training. The project will enable KNR to move increasing quantities of bulk commodities and passengers on routes for which the railways remain the most economic mode of transport, thus realizing sizeable savings in transport costs to the entire economy. The main area of risk for railway projects is traffic forecasting. However, in Korea's rapidly growing economy, it is unlikely that the shortfall, if any, will be significant.