Niger - Feeder Roads Project

Document of The 'World Bank FOR OFFICIAL USE ONLY FILEMCP Report No. 2219-NIR NIGER FEEDER ROADS PROJECT STAFF APPRAISAL REPORT February 6, 1979 Western Africa Projects Department Feeder Road Section, RMWA This document bas 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 Units CFA Francs (CFAF) US$1.00 = CFAF 230 CFAF 1 million = US$4,348 Fiscal Year October 1 - September 30 System of Weights and Measures Metric British/US Equivalents 1 meter (m) 3.28 feet (ft) 1 square meter (m2) 10.76 square feet (sq ft) 1 cubic meter (m3) 1.307 cubic yards (cu yd) 1 kilometer (km) 0.62 miles (mi) 1 square kilometer (km2) 0.39 square miles (sq mi) I hectare (ha) 2.47 acres (ac) I metric ton (t) 2,205 pounds (lb) i kilogram (kg) 2.2 pounds (lb) Abbreviations and Acronyms BCEOM Bureau Central d'Etudes pour les Equipements d'Outre-Mer (France) CIDA Canadian International Development Agency CILSS Comite Inter-Etat pour la Lutte contre la Secheresse dans le Sahel CFDT Compagnie Francaise pour le Developpement des Fibres Textiles DPW Directorate of Public Works (in MPWTU) DT Directorate of Transport (in MPWTU) FRTS Feeder Road Technical Section EDF European Development Fund FAC Fonds d'Aide et de Cooperation (France) FNI National Investment Fund GR Genie Rural (in MRD) IMFC Interministerial Feeder Road Committee MP Ministry of Planning MPWTU Ministry of Public Works, Transport and Urbanism MRD Ministry of Rural Development OCBN Organisation Commune Benin-Niger des Chemins de Fer et des Transports OPVN Office des Produits Vivriers du Niger SCRTN Department of Roads and New Works (in DPW) SNTN Societe Nationale des Transports Nigeriens SONARA Societe Nigerienne de Commercialisation de l'Arachide UNCC Union Nigerienne de Credit et Cooperation vpd Vehicles per day voc Vehicle operating costs  REPUBLIC OF NIGER FOR OFFICIAL USE ONLY STAFF APPRAISAL REPORT FEEDER ROADS PROJECT TABLE OF COINTENTS Page No. I. THE TRANSPORT SECTOR ....................................... 1 A. Geographic and Economic Setting ........................ 1 B. Agricultural Sector .................................... 1 C. Transport System ....................................... 4 D. Transport Services in Agricu]Ltural Areas ............ ... 5 E. Transport Sector Management and Investments ........ .... 6 F. Bank Activities in the Transport Sector ............ .... 8 II. THE HIGHWAY SECTOR ......................................... 10 A. The Road Network . . . . ................ 10 B. Traffic .......... . ..................................... il C. Transport Industry . . .. il D. Highway Administration and Maintenance... 12 E. Road Planning and Construction ... 14 F. Financing ....15 III. THE PROJECT .16 A. General Description ..... . ....... 16 B. Feeder Road Program . . .17 C. Equipment and Materials Purchases . . .20 D. Workshops and Tools . . .20 E. Office Buildings ...... ........... . .20 F. Technical Assistance . . .21 G. Training .... ........................................... 22 H. Project Monitoring . . .22 I. Cost Estimates ....23 J. Execution ...25 K. Procurement . . .27 L. Financing and Disbursements . .28 M. Accounts and Audit . . .29 IV. ECONOMIC EVALUATION ........................................ 36 A. General ................................................ 34 B. Economic and Social Justification .37 V. AGREEMENTS REACHED AND RECOMMENDATION . .41 This report has been prepared by S. Hertel and P. Tessier Viennois (Engineers) and R. Bonney (Economist) based on findings of an appraisal mission in April 1978 and short post-appraisal missions in July 1978. 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 Worid Bank authorization.  TABLE OF CONTENTS (continued) ANNEX 1. Summary Economic Analysis First Year Road Program 2. Agricultural Crop Prices 1977/78 3. Example of Economic Evaluation of Road in First Year's Program 4. Draft Terms of Reference for Technical Assistance 5. Outline Training Program 6. Selected Documents in Project File CHART Organization of Ministry of Public Works, Transport and Urbanism MAP IBRD 13919  REPUBLIC OF NIGER STAFF APPRAISAL REPORT FEEDER ROADS PROJECT I. THE TRANSPORT SECTOR A. Geographie and Economic Setting 1.01 The Republic of Niger is a landlocked country of about 1.27 million km2 bordered on the north by Algeria, the south by Benin and Nigeria, the east by Chad and the west by Upper Volta and Mali. The population is esti- mated at 4.8 million with a growth rate of about 3% per annum. About 90% of the population lives in rural areas, and approximately 80% of them live in a 200 km wide zone along the southern border; north of this area the country becomes sub-saharan and saharan with infrequent and unreliable rainfall. Apart from the Air Mountains in the north and small areas of broken terrain in other regions, the topography is generally flat to rolling. The main engineering difficulty in road improvement and maintenance is the frequently poor quality and shortage of road making materials -- relatively little laterite, large areas of non-cohesive sands and limited availability of water -- which can lead to higher construction costs than in neighboring countries. 1.02 Estimated per capita gross clomestic product (GDP) at market prices in 1975 was US$130 (equivalent). Between 1970 and 1975 (a period of severe drought) there was real decrease in GDP of 2.8% p.a. It is, however, diffi- cult to estimate a reliable trend in GDP owing to the large annual variations in rainfall and their effect on agriculture and livestock activities, and recent production and price increases in the uranium mining operation at Arlit. The economy remains based on agriculture (30% of GDP) and livestock (12% of GDP). Uranium mining is steaclily increasing in importance. Although it contributes only about 4% of GDP, uranium concentrates account for more than 60% of the value of exports, and the mining operations contribute about 16% of Government revenue. 1/ While uranium mining will continue to be an important growth industry, the country's long-term development and the welfare of most of its people will continue tco depend on the agriculture and livestock sectors, perhaps supplemented by agro-industries. The Government is, there- fore, directing its development policies toward these sectors. B. The Agricultural Sector 1.03 Niger has two major farming zones which are located within a belt about 200 km wide running east and west across the southern part of the country. 1/ Since the most recent national accounts are for 1969, estimates are used.  (a) The valley of the River Niger: This zone depends primarily on rainfed agriculture and the seasonal flooding of low- lying areas. There are also about 3,000 ha of irrigated land, which may be expanded by 150,000 ha if a pro- posed dam is built at Kandadji. The main crops are rice, fruit and vegetables. (b) The rainfed areas: These cover approximately 10% of the country; the main crops are millet and sorghum for domestic consumption and groundnuts and cowpeas for export. Cotton and onions are of considerable importance in some areas. The following table shows the production of main crops from 1970 to 1976; the effects of drought can be clearly seen. Production of Main Crops ('000 tons) Crops 1970 1971 1972 1973 1974 1975 1976 Millet 871 959 919 627 883 581 978 Sorghum 250 267 208 126 219 254 280 Groundnuts 205 257 260 77 129 42 79 Cowpeas 84 72 144 92 133 218 216 Cotton il 9 6 4 8 9 7 Rice 37 27 32 46 30 29 29 Onions - - - - - 50 Source: Government Agricultural Statistics 1.04 Before 1973, Niger was self-sufficient in food grains in years of normal rainfall. Recent experience and Bank projections indicate that un- reliable rainfall and high population growth will lead to significant overall shortages of food grains in the foreseeable future. Yet, even with a national shortage, there are regions with considerable surpluses. Given adequate col- lection and distribution services, including storage, vehicles and improved road access, much could be done to alleviate shortages elsewhere in the country.  -3 - 1.05 The Ministry of Rural Development's (MRD) four directorates-- Agriculture, Livestock, Rural Engineering (Genie Rural), and Water and Forests--plan rural development and implement development projects. At the farm level the Union Nigerienne de Credit et Cooperation (UNCC), is responsible for agricultural marketing, input supply, agricultural cooperative development, and management of certain development projects. Private traders/ transporters also play an important part in the supply of farm inputs. Three parastatal agencies control the final marketing and processing of certain crops: (a) Societe Nigerienne de Commiercialisation de l'Arachide (SONARA) for cowpeas and groundnuts; (b) Office des Produits Vivriers du Niger (OPVN) for cereals; and (c) Compagnie Francaise pour le Developpement des Fibres Textiles (CFDT) for cotton. 1.06 Government strategy in the agricultural sector is, first, to intro- duce measures to maximize both crop and livestock production in rainfed regions and, secondly, to increase the area under controlled irrigation. The major constraints on development of the agricultural sector are: (a) fre- quently poor and unreliable rainfall, (b) impoverishment of soils often due to over-cropping and poor husbandry, (c) inadequate inputs and extension services, and (d) difficult access. To overcome the problem of poor rainfall, the Gov- ernment plans to increase the area uncler irrigation. Projects are being developed with external assistance (including Bank Group) to overcome the other constraints. In the majority of- the development areas (rainfed and irrigated) transport improvements are identified as essential. Proposed investment in ongoing or planned agricultural projects (excluding livestock) during the five-year period 1978 to 1982 represents an average investment of about US$47 million p.a. Even allowing for the greater emphasis placed on agriculture, this level of investment seems optimistic in view of Niger's past record and absorptive capacity. The most recent available figures (1970-75) show average annual agricultural investment in 1978 prices of about US$25 million. 1.07 The main agricultural development projects either underway or pro- posed are the following: Maradi Integrated Rural Development Project (Cr. 608-NIR). This IDA-financed project was started in 1976 with an estimated cost of US$12.0 million of which an IDA credit provided US$10.7 million. Benefits will be derived from increases in the production of crops in rainfed areas, increases in irrigated agricul- ture, and livestock development. The project area has a population of about 325,000 inhabitants. The project includes the construction and improvement of 80 km of feeder roads which are being undertaken by contract. 1/ Zinder Integrated Rural Development Project (3 M's). This is a European Devel- opment Fund (EDF) financed project in the three regions of Matemeye, Magaria and Mirriah in Zinder Department. The project started its 15-year second 1/ The cost is high--CFAF 4.0 million per km.  - 4 - phase in 1977 with estimated costs of CFAF 1.95 billion (US$8.5 million equivalent). The benefits will be derived from (a) increasing yields from rainfed farming of millet, cowpeas and groundnuts; (b) the improvement of swamp lands for agriculture; and (c) development of poultry and livestork. Feeder road needs were identified during project preparation at about 230 km. The population of the project area is estimated at 710,000 inhabitants. Niamey Development Project. USAID is assisting in financing this project which is located in the regions of Filingue, Ouallam and Niamey. The first phase of the project began in 1977 with a large study element based on pilot operations. Eventually the four-year project will be extended to about 90 villages grouped into cooperatives with demonstration farming practices, agricultural extension services and the training of young farmers plus the provision of necessary inputs; millet, sorghum and cowpeas are the main crops. The ongoing pilot project will provide more reliable information on the project content and economic justification. Dosso Development Project. This project will enter its second phase in 1979. The first phase was financed by Fonds d'Aide et Cooperation (FAC) and USAID. The Bank is participating in the preparation of the second phase and is expected to cofinance it. Benefits will be derived from (a) increased yields of millet, sorghum, cowpeas, groundnuts and cotton; (b) the development of the crops in bottom lands; and (c) improving livestock. Project preparation is expected to be completed before the end of 1978. Approximately 415 kms of feeder roads have been identified as requiring improvement. Say Productivity Project. The region of Say possesses some of the few areas of useful non-exploited agricultural land in Niger. The objective of a pro- posed project to start in 1981 is to exploit this land by encouraging immigra- tion. Only very preliminary studies have so far been carried out and these indicate an initial investment of about 4.5 million CFAF. Financing for this project has not yet been obtained. Tahoua Productivity Project. The second stage of this project is being pre- pared and financing has yet to be arranged. The ongoing first stage is receiving EDF support. Benefits would be derived from (a) increases in cereal and cowpea production; (b) increases in cotton production; and (c) development of the important onion growing areas. This is essentially a dry-land farming project. The project's first stage includes about 190 km of feeder road improvements executed by a project unit; work has just commenced on these roads. No provision or arrangements have been made for the subsequent main- tenance of the feeder roads. C. The Transport System 1.08 Niger's transport system consists of 18,400 km of roads and tracks, an international airport at Niamey and five domestic airports, and to a limited extent the river Niger. Niger also has an important interest in the Benin  - 5 - railway operated by the Organisation Commune Benin-Niger des Chemins de Fer et des Transports (OCBN) which is one of its main outlets to the sea. The extent and density of the road system are generally adequate except for certain agricultural development areas where new feeder roads are needed. Past and present road programs have concentrated on the improvement of the main and secondary roads; feeder roads and tracks are generally of a low standard and require improvement and maintenance. Highways 1.09 Details of the highway sector are discussed in Chapter II. Air Transport 1.10 The size of Niger and the location of the capital in the south- western part of the country make domestic air transport important. Although the quality of land transport is improving, air services will remain important especially for passenger transport and emergency operations. Air Niger, the national airline, serves the five domestic airports using DC 3's, DC 4's and a recently acquired F 27 turboprop. A Boeing 737-200 aircraft was recently delivered and may be used for internal services when necessary airport improve- ments are carried out. However, efficient use of this aircraft may depend on a restructuring of tariffs in order to increase traffic. The Agence Inter- nationale pour la Securite de la Navigation Aerienne (ASECNA) operates the international airport at Niamey which was improved with the assistance of the Association (Cr. 473-NIR, 1974) and now is capable of handling 747 aircraft. Passenger traffic at Niamey in 1977 was nearly 76,000 while freight traffic amounted to nearly 9,000 tons. OCBN and Other External Transport Routes 1.11 OCBN, jointly administered by the governments of Niger and Benin, controls traffic on the Benin route, which is the major import/export route for Niger. Traffic on this route travels by rail between the port of Cotonou (Benin) and Parakou and by road between Parakou and Niamey. Other routes are (a) the Togolese railway and road route passing through Togo and Upper Volta; (b) the Regie Abidjan - Niger railway from Abidjan to Ouagadougou (Upper Volta) and thence by road to Niger; and (c) Nigerian Railways to Kano and thence by road to Niger which is used particularly for fuel imports. D. Transport Services in Agricultural Areas. 1.12 There are four main groups of transporters active in the rural and agri- cultural sectors: (a) SONARA which carries cowpeas and groundnuts and serves the more important regional markets (i.e., those markets with a catchment area of about 30 km radius) using trucks with 10- to 22-ton capacity;  - 6 - (b) OPVN which collects cereals from cooperative markets fre- quently located in isolated regions. The vehicle fleet consists of nearly 100 rigid and articulated trucks with capacities between 6 and 40 tons; (c) private transporters/traders, operating with or without a license, serve almost any market that is accessible, purchase and transport agricultural produce, and supply agricultural inputs, consumer goods and even credit. Their vehicles gen- erally have a capacity of less than 5 tons but no statistics are available; and (d) animal transport (especially by camel) which is very important in some areas owing to difficult access and small consignments (about 100 kilograms) and to socio-economic patterns. While most areas in Niger are accessible by vehicle during the dry season, vehicle operating costs on unimproved roads are very high. E. Transport Sector Management and Investments 1.13 The Ministry of Public Works, Transport and Urbanism (MPWTU) is responsible for planning and executing works related to the classified roads, road traffic, airports and public buildings. Planning is coordinated through the Ministry of Planning's (MP) Directorate of Programming and Planning. The Transport Plan study 1/ (completed in July 1978) should make recommendations for improved coordination between the two ministries. 1.14 MPWTU's Directorate of Public Works (DPW) and Directorate of Trans- port (DT) are directly involved in the transport sector. DPW improves, constructs, administers and maintains classi- fied primary and secondary roads (and a few unclassified feeder roads). It has (a) a Studies Department (which includes a materials laboratory) responsible for contract supervision; (b) a New Works Department, responsible for the execution of road construction and maintenance through regional divisions and sub-divisions; and (c) an Equipment Division responsible for managing and maintaining the central equipment pool. DT controls and regulates the transport industry and collects and analyses transport statistics. Both Directorates have seriously tried to increase the number of Nigerien per- sonnel at senior and middle management levels. This policy will continue, but they will have to rely for some time on expatriate assistance. 1/ The Association has not yet obtained a copy of this study.  - 7 - 1.15 The Government's objectives; in the transport sector are based on the premise that, in order to promote social and economic development, there is a clear need to improve internal and external communications by: (a) improving and extending major road arteries such as Zinder-Agadez, Zinder-Goure and Tahoua-Agadez-Arlit together with transport services; (b) improving secondary roads linking food deficit and surplus areas to the main road system; (c) constructing and improving feeder roads serving agricultural development areas; (d) making river traffic effective and studying the feasibility of extending a railway line to Niger; and (e) improving the main airports;. This policy, yet to be defined preciskely, largely meets the needs of the economy and is expected to continue dLuring the course of the economic and social development plan (1979-83) which is being prepared. During the past eight years, Niger has concentrated on improving its primary and secondary road network. Relatively little effort has gone into feeder roads (estimated at less than 1% of road investment). Feeder roads, nearly all unclassified, are the responsibility of local authorities, who do not have adequate finan- cial or physical resources for their improvement and maintenance. Investment in feeder roads is expected to increase to at least 5% of total road in- vestment during the next five years. 1.16 Between 1970 and 1977 (Table 1) investment in the transport sector totalled over CFAF 38.7 billion (US$176 million equivalent) of which 90% was allocated to the road sector. The current (1976-1978) three-year investment program totals CFAF 88 billion (US$400 million) including an estimated CFAF 37.0 billion (US$168 million equivalent) for the transport sector. In addi- tion about CFAF 25 billion (US$114 million) of private capital investment will be undertaken by uranium mining companies on the Tahoua-Agadez-Arlit road (646 km). In 1976 and 1977 total actual investment amounted to CFAF 16 bil- lion (US$73 million) which, allowing for inflation, does not represent a real increase over the yearly average for 1971-1975, but with the letting of the Tahoua-Agadez-Arlit road contracts eaLrly in 1978 annual investment will probably rise by about an additional CFAF 5 billion (US$23 million). 1.17 From 1972 to 1977 road maintenance expenditures for classified roads amounted to about CFAF 4.8 billion (US$23 million), which is one of the best performances in terms of expenditure per kilometer in Western Africa. The  - 8 - physical standard of routine maintenance for classified roads carried out by the sub-divisions of DPW is also of an adequate standard although the periodic maintenance of gravel roads requires additional effort, and this is being addressed in the Third Highway Project. Tn 1977, road maintenance expendi- tures on primary and secondary roads are estimated to have been CFAF 1.6 billion (US$7 million), an increase of nearly 6% in real terms over 1976, and represent about US$1,000/km. E. Bank Group Activities in the Transport Sector 1.18 The Association has played an important part in the transport sector. Table 1 shows IDA's contributions to financing of transport development for 1970 through 1975 and for 1976 and 1977. There have been four IDA financed projects in the highway sector in Niger: First Highway Project (Cr. 55-NIR, US$1.5 million, 1964) which comprised the engineering and construction of about 60 km of road mainly serving groundnut producing regions; Highway Maintenance Project (Cr. 128-NIR, US$6.47 million, 1968) addressed Niger's highway maintenance needs and also included pre-investment studies which led to the Second Highway Project; Second Highway Project (Cr. 231-NIR, US$6.55 million, 1971) provided for the construction of about 140 km of road and the study of 170 km which were to form the basis of the Third Highway Project; and Third Highway Project (Cr. 612-NIR, US$15.6 million, 1976, plus another US$7.0 million and US$3.6 million provided by BADEA and ADF) comprised a 4-year highway main- tenance program (including equipment procurement and staff training), the construction of the Zinder-Nigerian border road (49 km) and a survey of Niger's road construction industry; this project is scheduled to be completed by mid- 1981. Projects have generally been well executed by DPW using mainly foreign con- tractors and consultants. Apart from some delays the projects have been