The Inter-American Development Bank (IDB) has approved a $120m loan to Argentina for road repairs in several provinces including La Pampa, Entre Ríos, Córdoba and Formosa.

The loan is the first tranche of a $2.5bn loan approved by ADB to support renovation and expansion of provincial road network across the country.

The money will help meet the rising demand of improved road infrastructure due to increased agricultural production and exports in recent years, the bank said.

In addition to improving road access in the provinces and reducing vehicle operating costs, the renovation will reduce and even eliminate road closures caused by heavy traffic.

The loan will also finance a diagnostic study to improve the management of the road network, road safety, maintenance and weight control.

According to bank estimates, the road system in Argentina would need over $1,500m annually in investments for repairs as well as to catch up with the backlog in expansion and improvement projects.