Costa Rica signs loan with China to fund expansion of highway to Costa Rica’s Caribbean

The renovation and expansion of Route 32, the main highway connecting Costa Rica’s capital with the Caribbean province of Limón, could start as early as next month, following the signing by Costa Rica of a $395 million loan package with China.

President Laura Chinchilla on Thursday inked the deal with the Export-Import Bank of China. The total cost of the project is $485 million, with the Costa Rican government agreeing to foot the remainder of the bill.

Work on the road – a main thoroughfare for transporting goods to and from port – could take up to 42 months to complete along a 107-kilometer stretch. Most of the highway will be expanded from two to four lanes, and according to Transport Minister Pedro Castro, will include 26 kilometers of bike paths. The project also includes the construction of 36 new bridges, 23 pedestrian crossings and 176 bus stops.

Work will be carried out by China’s Harbour Engineering Company LTD, which will provide all the workers and machinery.

Financing on the loan from China was set at 20 years at a 3.5 percent interest rate, with a grace period of up to four years.

According to officials from the Public Works and Transport Ministry, the project will shorten travel distance between Costa Rica’s capital and its main port by a whopping 20 minutes.

Lawmakers now must approve the loan before the project moves forward.