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By the time you've swapped the engine, and upgraded the fornt brakes, and the rears to discs you'd be better off selling the 1.6 and buying a 16v. Insurance will be cheaper on the 16v than the modded 1.6 too.
if insurance matters i'd suggest leaving it alone and make it look good instead as you won't get any 'power' increase without some serious modifying i suppose you could add a filter + exhaust to it - make it sound better if that helped ?
personally i would go for handling and braking, that way you can make the most out of what limited you already have
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