Dominican Republic - Second Road Maintenance and Reconstruction Project

Document of The World Bank FOR OFFICIAL USE ONLY c L t Report No. 2698b-DO STAFF APPRAISAL REPORT SECOND ROAD MAINTENANCE AND RECONSTRUCTION PROJECT DOMINICAN REPUBLIC November 29, 1979 Projects Department Latin America and the Caribbean Regional Office This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  Currency Equivalents Currency Unit = Peso (RD$) US$1.00 = RD$1.00 RD$1 million = US$1 million System of Weights and Measures Metric British/US Equivalent 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 mile (mi) 1 square meter (sq m) = 0.386 square mile (sq mi) 1 metric ton (m ton) = 1.1 US short ton (sh ton) Fiscal Year January 1 to December 31 Abbreviations and Acronyms AADT Annual Average Daily Traffic AASHO American Association of State HdLghway Officials ASTM American Society for Testing Materials B/C Benefit/Cost CEA Sugar State Council DGC General Directorate of Highways DGCV General Directorate of Rural Roads DGPP General Directorate of Planning and Programing DGT General Directorate of Transportation ERR Economic Rate of Return IDB Inter-American Development Bank ONAPLAN National Planning Office SEOPC Secretary of State for Public Works and Communications TPU Training Production Unit VPD Vehicles per day UNDP United Nations Development Program USAID United States Agency for International Development  FOR OFFICtAL USE ONLY DOMINICAN REPUBLIC SECOND ROAD MAINTENANCE AND RECONSTRUCTION PROJECT STAFF APPRAISAL REPORT TABLE OF CONTENTS Page No. I. THE TRANSPORT SECTOR ............ 1 A. General ........................................... 1 B. The Transport System ... . ........ ... ... . .............. 2 C. Planning, Coordination and Financing .... .......... 5 D. Recent Sector Improvement and Recommended Developments ....... ................. 7 II. THE HIGHWAY SUBSECTOR ..... ................... 8 A. The Highway Network *................* .............. 8 B. Characteristics and Growth of Road Traffic ........ 9 C. The Road Transport Industry .. . . 10 D. Highway Administration ............. .............. 12 E. Highway Planning ...... ........................... 12 F. Highway Financing ....... .......................... 13 G. Highway Engineering . .............................. 14 H. Highway Construction .................. . ........... 14 I. Highway Maintenance .... ............................ 15 J. Rural Roads .... ................................... 17 III. PAST AND ONGOING BANK ASSISTANCE TO THE HIGHWAY SUBSECTOR 18 IV. THE PROPOSED PROJECT ... ................... 20 A. Objectives, Long-Term Framework and General Description .................. ................... 20 B. Project Components and Requirements ............... 23 C. Cost Estimates, Financing and Disbursement . . 29 D. Execution, Procurement and Monitoring ............. 32 E. Project Risks ............. ........................ 34 V. ECONOMIC EVALUATION .................................... 35 A. Road Reconstruction and Maintenance Programs ...... 35 B. Pilot Rural Roads Program ............. ............ 39 VI. AGREEMENTS REACHED AND RECOMMENDATION ............... ... 42 This report is based on the findings of an appraisal mission which visited the Dominican Republic during May/June 1979. The mission comprised Messrs. J. Veniard (Senior Economist), L. Revuelta (Engineer), S. Kowalski (Engineer), G. Morra (Training Specialist), G. Segerlund (YP), and N. Kliver (Consultant). The report has been edited by Miss V.R. Foster. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  TABLE OF CONTENTS (Continued) Page No. TABLES 1.1 Summary of Foreign and Passenger Traffic by Mode .... ...... 46 1.2 The Highway Network ....................................... 47 1.3 Transport Infrastructure Investment by Mode in Comparison with Total Public Sector Infrastructure Investment ...... 48 1.4 Estimate of Transport Sector Expenditures .... ............. 49 2.1 Vehicle Fuel Consumption .................................. 50 2.2 Vehicle Registration ...................................... 51 2.3 Vehicle Weight Control .................................... 52 2.4 Estimates of Highway Expenditures and Road Users' Contribution ............................................ 53 2.5 SEOPC's Design Standards .................................. 54 4.1 Five-Year Road Reconstruction and Maintenance Programs (1980-1984) ............................................. 55 4.2 Tranche of Reconstruction Program Included under the Project ................................................. 56 4.3 Tranche of Reconstruction Program to be Engineered under the Project ............................................. 57 4.4 Tentative List and Cost Estimate of Equipment for Highway Maintenance and Personnel Training ...................... 58 4.5 Tentative Rural Roads Construction Program (1980-1982) .... 59 4.6 Schedule of Estimated Disbursements ....................... 60 4.7 Schedule of Implementation ................................ 61 5.1 Road Reconstruction Program (2 pages) ..................... 62-63 5.2 Reconstruction Components ................................. 64 5.3 Summary of Vehicle Operating Costs ........................ 65 5.4 Summary of Maintenance Program and Reconstruction Project Economic Evaluation ..................................... 66 5.5 Pilot Rural Roads Program, Results of Economic Evaluation.. 67 ANNEXES 1. Outline Terms of Reference for Civil Works Supervision of Reconstruction Program .............................. 68 2. Outline Organization and Staffing of the Road Reconstruction Planning Unit ........................... 70 3. Outline Terms of Reference for Technical Assistance for the Maintenance Program ............................ 72 4. Terms of Reference for Technical Assistance for the Personnel Training Program ..................... 79 5. Outline Terms of Reference for Technical Assistance for the Pilot Rural Roads Program ...................... 94 6. Road Maintenance and Reconstruction Model .... ............ 103 7. Economic Benefits of Pilot Rural Roads Program .... .. 105 8. Selected Documents and Data Available in the Project File 111 CHART World Bank 20650 - Organization Chart of the Secretariat of State for Public Works and Communications MAP IBRD 14492 - Dominican Republic - Second Road Maintenance and Reconstruction Project  I. THE TRANSPORT SECTOR A. General 1.01 The Dominicar. Republic comprises the eastern two-thirds of the Caribbean 2Island Hispaniola, which it shares with Haiti. It has an area of 48,400 km and a population of 5.4 million; during the last decade, the popu- lation has grown at a rate of about 3% per annum. The Republic is crossed by four mountain ranges separated by fertile valleys. The bulk of the population is located in the Cibao Valley, the most productive area, running from north to south through the central part of the country and linking Santo Domingo, the capital city (980,000 inhabitants), with Santiago, the second main town (245,000 inhabitants), and with Puerto Plata (40,000 inhabitants) on the Atlantic Coast. The very dry, relatively undeveloped southwestern part of the country is sparsely populated. 1.02 The Dominican Republic relies for its transportation upon an exten- sive road network, several ports, an international airport, and various rail- way lines. International freight traffic is handled at nine ports, but most of the activity is concentrated in Santo Domingo and its surroundings. International passenger traffic is now almost exclusively handled at Santo Domingo's international airport, Las Americas. International road transport between Haiti and the Dominican Republic is negligible because of limited trade volume and the poor condition of existing road connections. 1.03 Domestic transport includes the hauling of the main export products to international ports and internal trade in agricultural and industrial commodities. Because of the small size of the country, the location of its resources and its economic structure, internal transport distances are short. The main exports--sugar and minerals--are produced near ports and normally require hauls of less than 100 km. Domestic trade is mainly in agricultural products from the Cibao Valley and in industrial products and consumer goods from Santo Domingo; their average haul distance is about 125 km. As a result of these short haul distances, highway transport is the most widely used mode, accounting for almost 99% of the total domestic transport of goods (excluding sugarcane and sugar products) and passengers. The railway system provides mainly freight transport for sugarcane and sugar products, which account for about 60% of the total domestic ton-km (Table 1.1). 1.04 The transport system in the country is broadly adequate, and, although the road network is not dense, it provides access to all major producing areas, reflecting past Government objectives of improving the physical infrastructure of the country. However, as the emphasis on transport sector investments declined in recent years, inadequate funding of operations and maintenance of the physical facilities resulted in the present poor condition of the system. The need for road rehabilitation, in particular, is acute. This need has been recognized by the Government, which considers rehabilitation and its complement, preventive maintenance, to be of the highest priority, matched by the high priority given to the construction and improvement of rural access roads, upon which future agricultural growth depends. The confirmation of these priorities as the policy of the present administration  -2- is in line with the recommendations of the Bank, whose assistance in the implementation of a Road Reconstruction and Maintenance Program constitutes the basic component of the proposed project. B. The Transport System (i) Highways and Road Transport 1.05 Roads are concentrated mostly in the center of the country, around the axis joining Santo Domingo with Santiago, the center of the richest agri- cultural area; a dense road network also exists in the east, the sugarcane- producing area. Although the highway network of the Dominican Republic as a whole is not very dense (0.2 km/km ) in comparison with that of similar Caribbean countries, 1/ it gives access to all the major production areas. The adequate highway network, together with a very high economic growth (GNP per capita has more than doubled during the last decade), has strongly stimu- lated the development of the Republic's vehicle fleet, which grew at 11.8% yearly over the period 1968-1978. The present status of road freight and passenger transport is discussed in Chapter II. 1.06 Government investments in the highway subsector have averaged US$35 million p.a. over the period 1970-1978, extending the network to its present length of about 11,900 km. About 5,100 km constitute the national system, of which some 4,600 km are paved. The 5,800 km outside the national system are classified as feeder roads (Table 1.2). Since the size of the national system is basically adequate in coverage, construction of additional highways is not high priority at present. However, the condition of the national network is not satisfactory. Nearly one-half of the roads are badly deteriorated, and, because of their inadequate design and poor construction, they are obsolete and not amenable to maintenance. This obsolescence is observed in platforms of irregular and insufficient width, not providing for adequate drainage, and in lightly built pavement. The feeder road network is also in poor condition and in need of improvement. These subjects are discussed in full in Chapter II. (ii) Ports 1.07 There are nine international ports, four cabotage ports and two tourist ports in the Dominican Republic. The main ports are Santo Domingo and Haina in the south and Puerto Plata in the north; these three ports handle almost 60% (3.7 million tons in 1976) of all imports and exports combined, excluding petroleum products. Haina handles most of the country's petroleum 1/ Jamaica 1.4; Trinidad and Tobago 1.2.  -3- imports, i.e., about 1.7 million tons. Santo Domingo takes care of a large part of imported goods, while about one-third of total exports (mineral) pass through the mineral-specialized port of Pedernales in the southwest, close to Haiti. Puerto Plata handles mostly exports of agricultural products from the Cibao Valley. Main export commodities handled at these ports