Cameroon - Sixth Highway Project

Document of The World Bank FOR OMCIAL USE ONLY i 0<tod ~~~~~~~~-2zYY C e9 Report No. P-4072-CM a REPORT AND RECONMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN OF US$ 125 MILLION TO THE REPUBLIC OF CAMEROON FOR THE SIXTH HIGHWAY PROJECT May 10, 1985 .-Tis document hE a restricted distribuon sad may be ued by recipients only in the peronmance of J their official duthes. Its contets may not otherwise be disclosed without World Bank authorizaion.  CURRENCY EQUIVALENTS Currency Unit - CFAP U$1.00 - CPAP 490 CFAP 1 mUillon -US$ 2,040 'WEIGHTS ANiD MEAURES Decimal Met3ric, us Euvl 1 mete-r (an) 3.28 feet (ft.) 1 kLiometer (kmn)- 0.62 wiles (mi.) 1 metric ton (t) 2,205 pounds (lb.) ABBREVIATIONS AIND ACR0NY1S DCX Direction Centrale des Marcheis (Central Tender Board) ERR Economic Rate of Return Laboginle LaboratoiLre de Ciinie Civil (National CiviJl Woiks' Laboratory) "MINQ Minis t5re de 1' Eq7iipement (MiniLstry of Equipment) KmN Miuistgre des Transports (Min-istry of Transport) PN?1GC Pare NatiLonal do Mateiriel de G;enie Civil (National EquiLpment Pool) FISCAL YEAR July 1 June 30  FOR OFFCIAL USE ONLY REPUBLIC OF CAHMROON SIXT' HIGHWAY PROJECT LOAN AND PROJECT SUH&RY Borrower: Republic of Cameroon. -eneficiaries: Ministry of Equipment 0MINEQ), Ministry of Trans- port (MMIT), National Equipment Pool (PNMIGC), and National Civil Works Laboratory (Labogenie). Amount: US$125 million equivalent, including Bank's participation in a B-loan. Terms: 20 years, including five years' grace, at the standard variable rate. Co-Financing: Public agencies, commercial banks and export credit agencies for anount, terms and conditions not yet determined. On-Lending Terms: Bank rate for operational equipment. Exchange risk borne by the Government. Project !escription: The main objectives of the project are: (a) to increase road transport capacity, while reducing transport cost and protecting past investments in the paved highway network; (b) to consolidate past efforts in institutional development for the transport sector; (c) to strengthen the management system of PNMGC to improve its productivity and its control of resource utilization; and (d) to strengthen Labogenie's operational and research capacity. To reach these objectives the project consists of: (a) physical development of the paved highway network, containing the following elements: This document has a restricted distnibution and may be used by rcipients only in the performance -:o:ef theu official dutie Its contents may not othewne be dised whout World Bank authorization.  W~~~~~~~~~~~~ ii - (i) a four-year pavement strengthening program (about 600 km) through bitu- minous overlays and partial realign- ment where necessary; (ii) the upgrading of about 150 km of gravel roads to paved standards; and (iii) consultant services for the super- vision of (i) and (ii) above and the preparation of feasibility studies and detailed engineering of future road upgrading projects; (b) institutional development in the transport sector, containing the following elements: (i) technical assistance to MINEQ to improve road investment planning and maintenance planning and execution; (ii) technical assistance to MINT to improve sector planning and road safety, including buildings and equipment for vehicle inspection; (iii) technical assistance to PNMGC to improve its management and operations; (iv) training for MINEQ, MINT, PNKGC, and Labogenie personnel together with selected fellowships; and (v) improvement of operational and train- ing facilities in MINEQ, PNMGC and Labogenie, including buildings, equipment and teaching aids. Benefits and Risks: The principal benefits expected from the project would be increased transport capacity, reduced transport costs and protection of previous invest- ment in the sector. A major non-quantifiable benefit would be the improvement of the sector's planning and management capabilities expected from project training and institution-building activi- ties. Other non-quantifiable benefits would be savings of time, lower road maintenance costs, and increased net value of agricultural produce. The principal risks associated with the project concern financing, costs, institutional develop- ment and traffic growth. Despite interest from public agencies and private banks in cofinancing this project, external financing may not be  .,' ,._ - Li. -ii sufficient to cover all foreign exchange costs. In this case, the Government has agreed either to reduce the scope of the road strengthening compo- nent or to finance the gap from its own resources. Continued strong competition among contractors is expected to keep construction costs within reason- able bounds. The institutional risk that PNMGC would fail to improve its performance is slim as measures to implement its action plan are already underway. The momentum of Cameroon's economic growth minxImises the risk of any significant slow-down in recent rapid growth of traffic volume. Summary Project Cost Estinate (net of taxes and duties) Categories Local Foreign Total -(S$ million) A. Buildings 0.9 1.1 2.0 B. Pavement Strengthening 44.2 85.8 130.0 C. Road Upgrading 20.4 39.6 60.0 D. Equipment 0.7 6.5 7.2 E. Consulting Services for: 1. Supervision of Construction 2.4 9.6 12.0 2. Studies for Future Project Preparation 0.7 2.7 3.4 3. Technical Assistance and Training 1.7 6.7 8.4 F. Fellowships 0.0 0.6 0.6 Total Base Cost 71.0 152.6 223.6 Physical Contingencies 7.1 15.3 22.4 Price Contingencies 16.9 32.1 49.0 Total Project Cost 95.0 200.0 295.0  - iv - Financing Plan Local Foreign Total Organization (tUS$ imfio)on) - iBR - 125.0 125.0 Private Banks and other 75.0 75.0 possible cofinanciers Government 95.0 - 95.0 Total 95.0 200.0 295.0 Estimated Disbursement (Bank Loan) IBRD Fiscal Year 1986 1987 1988 1989 1990 1991 (US$ million) Annual 6.0 23.0 36.0 34.0 21.0 5.0 Cumulative 6.0 29.0 65.0 99.0 120.0 125.0 Economic Rate of Return: 151 NAPS: IBRD 18425-R IBRD 18545 WAPT2 May 1985  INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT REPORT AND RECOMMHEDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE REPUBLIC OF CAMEROON FOR A SIXTH HIGHWAY PROJECT 1. I submit the following report and recommendation on a proposed loan to the Republic of Cameroon for the equivalent of US$125 million to help finance a Sixth Highway project. The loan would have a term of 20 years, including five years of grace, at the standard variable interest rate. Part of the loan proceeds would be made available to PNMGC, a public agency responsible for the maintenance of road equipment. B-loan co- financing would be sGught for this project. PART I - THE ECONOMY 2. A report entitled "United Republic of Cameroon-Economic Memoran- dum" (Report No. 2877-ACM), was distributed to the Executive Directors on April 30, 1980. Since then, several economic and sector missions have visited Cameroon. Their major findings are incorporated in the following paragraphs. Annex I provides basic country data. Background 3. Cameroon is one of Africa's most diverse countries, with a wide variety of climatic and ecological zones, ethnic groups languages, and traditional cultures. It has an estimated population of 9.3 million (1983) and covers an area of 475.000 km2, about the same as Spain. The overall population density is low, but there are several densely-populated regions in the west and the extreme north, for example. The main centers of population and economic activity are widely separated, making the develop- ment and maintenance of an adequate transportation network vital but also costly. Cameroon's main opportunities for development lie in the expansion of agricultural, livestock and forestry production; the exploitation of energy and mineral resources; and the processing of agricultural, forestry and mineral products for domestic consumption and export. Cameroon became an oil producer in 1978 and total production is estimated at 7.6 million tons in 1984. Most of the oil is exported as crude; only about 1.2 million tons are refined in Cameroon, to meet domestic demand. 4. Basically an agricultural economy at independence in 1960, Cameroon has experienced rapid rural-urban migration, and over one third of the population now lives in cities or towns. Douala, the major industrial center and port city, has an estimated population of about one million; YaoundE, the capital, is the second-largest city, with an estimated 500,000 residents. Apart from these two large cities, hovever, there are several other urban areas of significant size; these s condary centers play impor- tant roles in the economies of the various regions.  -2 5. The stated development philosophy of the Government of Cameroon is "planned liberalism"', characterized by five-year indicative investment plans and a mixture of private and public ownership. Market forces are tempered by extensive Government regulation in areas such as price control, investment incentives, interest rates and credit allocation. In general, the Government's macroeconomic policies have been prudent and Cameroon's GNP per capita (US$800 in 1983) is one of the highest in sub-Saharan Africa. In addition, the country has enjoyed exceptional economic and social stability, in line with the Government's emphasis on balanced regional development and strong central authority. 6. The past few years have been a period of transition. In November 1982, after almost 25 years in power, President Ahmadou Ahidjo resigned and his constitutional successor, Prime Minister Paul Biya, became President. President Biya consolidated his power in September 1983 when he was elected president of the sole political party and in January 1984 when he was con- firmed as President of Cameroon in a national election. However, the country was shaken in April 1984 when a group of soldiers launched an unsuccessful coup attempt. Over this past year, Mr. Biya has promised a more democratic style of government, more rigor in the management of public funds and greater social justice. The new Government is committed to economic liberalization, although still within the context of "planned liberalism". It has also endorsed the objectives of preserving a strong agricultural base, maintaining a high degree of food self-sufficiency, and building up social and transport infrastructure, via a moderately enlarged investment program. It has expressed strong interest in improving the efficiency of state enterprises, including, in some cases, through priva- tization. Economic and Social Developments 7. Over the past two decades the Government has managed to establish favorable conditions for accelerated economic growth and fiscal stability. Average growth was sluggish in the 1960s and early 1970s at 3.7 percent per annum, but accelerated to 8.6 percent per annum in the second half of the 1970s and is estimated at about 7 percent for the first half of the 1980s. Investment, which was at a low 10 percent of GDP in the early 1960s, grew to an average of about 20 percent in the second half of the 1970s and to 26 percent in 1983. This growth in investment was made possible by the gradual easing of constraints to absorptive capacity, the increase in domestic savings and more recently, oil resources. Before the beginning of oil exports in 1978-79, Cameroon registered small trade deficits, though modest surpluses were recorded in 1973-74 and 1977-78. The small deficits on the current account were amply offset by capital account flows, mainly public borrowing. However, despite a tenfold increase in public indebted- ness in current terms during the past decade, the debt service ratio has consistently remained under 15 percent. 8. Prior to 1978, Cameroon's economy, apart from a small manufactur- ing sector concentrated in heavily protected import substitution activi- ties, was based essentially on agriculture. Agricultural products account  -3- for 71 percent of 1978 export earnings, coffee and cocoa alone accounted for 53 percent. However, oil production began in 1978 and it rapidly assumed a dominant position in total merchandise exports (63 percent in 1983) as well as representing an important fraction of total GDP (13 percent in 1983). The vast majority of the labor force, however, remains in agriculture: 75 percent according to the most recent estimate. 9. Although steady progress has been made in the-well-being of the population over the past two decades, much remains to be done in the social sectors. Enrollments increased considerably at all levels of the educa- tional system, but its quality and efficiency deteriorated. Health-related indicators are on the low side, considering Cameroon's overall level of economic development. Life expectancy at birth is a low 53 years. the result of a still high infant mortality rate. Inadequate health coverage, poor access to water supply, lack of sanitation services in crowded urban areas, poor nutrition and health practices are the main reasons for this high rate. 10. In 1981, about 40 percent of the rural population was considered to live in absolute poverty, i.e., with an annual per capita income of less than US$105 (1981). This may in part explain the heavy rural out-migration to the cities of Yaoundt and Douala, where average incomes are considerably higher than in the countryside, in part fueled by the expenditure of increasing oil revenues giving rise to expectations of formal sector employment under favorable conditions. In actual fact, however, conditions in these cities are not much more favorable, with one quarter of their population classified as absolutely poor. Development Prospects and Issues 11. The basic issue for Cameroon is to adjust to the oil and post-oil eras. Despite a variety of other mineral resources, it is unlikely that their exploitation will make up for the expected decline of oil production beginning in the late 1980s. Oil revenues offer a window of opportunity to finance needed investments and introduce policies aimed at preparing the economy for the post-oil era for example, measures aimed at increasing productivity in agriculture. On the other hand, lack of caution in using oil revenues could have highly disruptive effects on the economic and social fabric of the country. So far caution has prevailed. However, pressures for an accelerated improvement of living conditions are mounting. 12. In the longer term, the major issue is to cope with a fast- expanding population. Although its growth rate, currently estimated at 3.2 percent p.a. is not uncommon in the regional context, it is accelerating, and Cameroon's population is expected to double in 22 years. The urban population would triple to 9 million. Providing meaningful employment opportunities to a sharply expanding urban labor force is and will remain a major challenge for the Cameroonian authorities. At present only 25 percent of the labor force is employed outside agriculture, 10 percent in industry and 15 percent in services. If large-scale unemployment is to be  -4- avoided in cities, by the year 2000 about 2 million jobs would have to be added to the existing 750,000 outside agriculture. 13. The Government's major objectives in the Fifth Plan period (1981-86) are to maintain food self-sufficiency, improve income and living conditions in rural areas as a means of slowing down migration to cities, provide health services and adequate drinking water to a vastly expanded portion of the population and greatly increase the supply of well-trained Cameroonians. These objectives are consistent with Cameroon's present requirements. The projected annual GDP growth rate of 7 percent over the Fifth Plan period appears comfortably attainable. External Borrowing and Creditworthiness 14. Total public external debt outstanding and disbursed rose from US$371 million at the end of 1976 to US$1.9 billion at the end of 1983. Debt service payments rose from US$39 million in 1976 to US$219 million in 1983, while exports increased from US$700 million in 1976. to about US$1.7 billion in 1983. However, Cameroon's traditionally modest reliance on external financing has been followed, during the oil era of increased financial independence, by diminished recourse to external borrowing and some prepayment of foreign loans. Gross disbursements against public and publicly guaranteed external borrowing have declined sharply from a peak of US$564 million in 1980 to US$163 million in 1983. Net transfers have fallen from a peak of US$389 millions in 1979 to minus US$57 million in 1983, when debt service payments exceeded gross disbursements. Rising interest rates, a hardening of average loan terms and the appreciation of the dollar have increased Cameroon's debt service ratio somewhat since 1980. However, the debt service ratio appears likely to remain below 15 percent for the rest of the decade, even allowing for a continued decline in external lending to Cameroon on concessional terms. Cameroon is basi- cally creditworthy. 15. The public enterprise sector is becoming a major burden for the Government, and financial support of weak or failing enterprises now amounts to at least CFAF 100 billion, well over one-third of Cameroon's net oil revenues. It has become clear to the Government that this situation could not be alloved to continue, and the Government has now embarked with the Bank on what will probably be a major effort in the rehabilitation of the sector, concentrating both on the economic policy environment ultimate- ly responsible for the difficulties of the sector as well as on rehaLil- itating. liquidating or divesting individual enterprises. PART II - BANK GROUP OPERATIONS IN CAMEROON 16. Bank/IDA Commitments in Cameroon as of March 31, 1985, amounted to US$793.4 million equivalent and covered 44 projects: 21 in agriculture, 13 in transportation, three in education, three in public utilities, one small and medium-scale enterprise project, two technical assistance projects and one urban project. Transport and agriculture account for about 44 and 43 percent respectively of these commitments. IFC had  -5- Invested in raven enterprises, with total net loan /equity commitments of US$12.4 million. 17. Performance in project implementation is, on average, good in the transport sector, mixed in agriculture and mediocre in other sectors. The Government has generally shown willingness to collaborate with'the Banik in finding solutions, but implementation delays and setbacks have occurred, notably over the last year in the wake of recent political changes. In particular, the overall disbursement rate. which used to compare favorably with that of most other counLtries, has slowed down due to administrative bottlenecks, notably in the central procurement agency. Technical assis- tance to help streamline procurement procedures is being arranged. 18. The Bank's initial investment strategy in Cameroon was to support the Government's development efforts in three main directions: Wi strengthening and extending the road and rail trunk system and improving the port of Douala; (ii) raising agricultural output and exports; and (iii) improving education. Until 1975, apart from one water supply project, Bank lending was coucentrated entirely in the transport, agriculture and educa- tion sectors. Since 1975. Bank lending has diversified into forestry. small- and medium-scale industry, urban development, technical assistance and telecommunications. For the immediate future, projects are being prepared in agriculture to support the Government's objectives of increas- ing smallholders' productivity and improving the quality of rural life, in transport to upgrade, expand and maintain the network, in urban development to build up the local government" capabilities to cope with fast growth, in education / manpower training to support the demands of increasing public and private investment, and in health for the under-serviced rural areas. 19. In view of the expected decline of oil revenues in the late 19EOs, the Government of Camneroon would like the Bank to maintain an active assistance program as: (i) a way of ensuring a smooth and continued flow of resources for development; (ii) a vehicle for technical assistance in project design and implementation; (iii) a guarantee of impartiality in providing guidance; and (iv) a source of advice for policy reform. The rationale for maintaining a sizeable Bank program lies in the need to meet the country's increased and more complex requirements for development assistance. In order to ensure productive use of its oil revenues and to prepare for the post-oil era, the Government must make critical decisions concerning the size and composition of the domestic investment program and the removal of the major development bottlenecks. The Bank's major objec- tives are to strengthen the Government's policy making, investment planning and implementing capabilities, promote private initiatives and reduce the role of the parapublic sector in the economy, develop the country's human resource base and improve the living conditions of lower income groups. 20. The Bank's objectives will increasingly be pursued through sectoral approaches combining lending, intensified economic and sector work and technical assistance to the central and technical ministries. The Bank is in the process of prepa-ring and discussing with the GovernmLent strategy  -6- papers for the major sectors with a view to reaching broad agreement on a macroeconomic and sectoral policy framework. This dialogue is expected to pave the way toward a more sectoral approach to lending in support of well- defined Government programs. Key topics for discussion will be the role of the public enterprise sector, trade liberalization and pricing policies, the pace and pattern of resource development. skilled manpower constraints and needs, and administrative reform. Although the Government is keen on moving towards sectoral approaches, differences of opinion on their content might delay their formulation and implementation. Nevertheless, for the years ahead, the nature of the Bank's involvement is expected to shift towards fewer but larger sectoral operations. 21. Disbursements of official development assistance during the second half of the 1960s amounted to about US$45 million a year, mostly in the form of grants. France provided most of the assistance. In the 1970s, foreign aid increased to about US$90 million a year, with only one-fifth in the form of grants. Bank and IDA financing amounted to about 23 percent of total disbursements and the Bank Group became the major source of public assistance. Cofinancing has been featured in 22 of the 44 Bank-financed projects and is being actively sought for several projects under considera- tion to improve aid coordination and support a gradual shift to private financing. 22. Cameroon's borrowing from private sources accounted for 31.5 percent exterral financing in 1982, from only 11 percent in 1967-69. Public external debt outstanding and disbursed as of December 31, 1982, amounued to US$1.9 billion, 8.2 percent of which was in the form of Bank loans and 8.5 percent in IDA credits. Bank loans in 1982 accounted for 6.4 percent of public external debt service and IDA credits for 0.7 percent. By 1985, Bank loans and IDA credits are projected to account for about 26 percent of debt outstanding and about 14 percent of debt service. PART III - THE SECTOR 23. The Network. The transport network is organized along a South/North axis originating in Douala which is the main port and economic center of the country, providing access to the sea for the capital, Yaounde, the interior and Cameroon's land-locked neighbors (Chad and the Central African Republic). In all, there are about 65,000 km of highway, giving Cameroon an overall road density in keeping with the regional average. However, fully half are unclassified earth roads and tracks and only 4 percent are paved, well below the 15 percent average for the region. The railways network is comprised of two principal lines: the Transcameroon, from Douala to Yaounde and Ngaoundere (943 km); and the Western, from Douala ta Nkongsamba (200 km). Apart from Douala, there are four other minor ports. Cameroon has two international airports, at Douala and Garoua, and there are about a dozen smaller domestic airports. There is a need to upgrade parts of this network, including the paved roads network, to handle the rapidly increasing traffic volume economically.  . _ ,, l _ ., ~ ~ ~ .- . *. '.Z ;-v; - --- 7- 24. Government Strategy and Policies. While the transport sector was greatly extended during The Third and Fourth Plan periods to provide a basic infrastructure for the economy, it remains rather rudimentary for a country of Cameroon's size and prospects. Parts of the country remain isolated and there is need to upgrade the highway network to meet existing and anticipated future needs efficiently. Traffic volume has increased significantly in recent years and is likely to continue to do so. The Government recognizes this need and the Fifth Plan (1982-86) emphasizes development of the highways subsector, particularly with regard to making border and remote areas accessible, improving the existing network through maintenance and reinforcement, resurfacing major roads, and developing a coherent highways program. This priority for highways is appropriate but achievement of the Government's goals in the subsector will depend to a large extent on improvement in the project planning and implementation capacities of the responsible institutions. 25. The Roads Subsector. The road network is most developed around Douala, Yaounde and Garoua. The condition of the roads varies; national, provincial and departmental gravel roads are being improved under the Fourth Highway Project but many of the earth tracks are impassable for part of the year. The condition of the paved roads is deteriorating, because of age, excessive vehicle loads, and a rapid increase in traffic volumes over recent years in line with economic expansion. 26. The national vehicle fleet grew at an average annual rate of 7 percent over the past decade to about 100,000 vehicles in 1982. In 1984, some 12,250 vehicles, operated by about 7,400 registered individuals or companies (55 of whom had more than ten vehicles), were engaged in road transport. The regulatory framework is liberal. A draft decree containing modest requirements for licensing, registration, safety and insurance is under discussion. It provides an appropriate framework for the future development of the subsector. The axle load limit of 10 tons was not strictly enforced in the past but with new weighing stations being in- stalled, the Government is launching a major program to see that it is respected in the future. 27. Planning and Policy FormuJation. Two basic problems affect the efficiency of the institutions in the subsector: shortage of qualified economists, engineers and technicians, and lack of consistent staff plan- ning and on-the-joL training. Government is actively addressing this issue and it is expected that by the end of this decade most of the vacancies will be filled with competent staff. 28. Although sector planning and policy formulation have improved in recent years, much remains to be done to better coordinate subsectoral development programs. The Ministrv of Transport is responsible for such coordination while the Ministry of Equipment is more specifically respon- sible for the highway subsector. Because of its inability to attract and retain motivated and qualified staff, the Ministry of Transport has until recently been unable to discharge its responsibilities for planning and coordination of sector activities. Its technical, analytical, and policy-  -8- making capacities were limited. It was also constrained by the lack of a data base on transport supply, demand and operating performance. However, several measures are underway to strengthen sector planning. Under the Fifth Highway Project (Ln.2180-CM). rechnical assistance was made available for initial operation of a planning function in the Ministry of Transport. After much delay, consultants were hired in the second half of 1984 and in early 1985, a Transport Planning and Coordination Unit with a staff of nine was set up in the Office of the Secretary General. Proposals have been made to seek Presidential approval for its establishment as a separate division. A Planning Division was established in the Highways Department of the Ministry of Equipment in mid-1982 with technical assistance provided under the Fourth Highway Project (Ln. 1273-CM, Cr.926-CM). At negotia- tions, the Government agreed to review with the Bank by ena Nove-mber 1985 specific proposals for further strengthening transport planning and coordi- nation. The work program of tbe technical assistance team would be re- viewed annually with special emphasis on gradually developing a local planning capability (Section 4.04 of the draft Loan Agreement). 29. A national transport survey also included in the Fifth Highway Project is expected to provide a data bank on which to base sector policy decisions, operations and investment and lead into recommendations for a sector policy package and investmeut p-o-ram. It was agreed at negotia- tions that the Government would review the recommendations arising from both the technical assistance to the Ministry of Transport and the trans- port survey with the Bank and consult with the Bank on follow-up action. It was also agreed -hat Government would consult the Bank annually on its transport sector program. (Section 4.04 of the draft Loan Agreement). 30. Administration and Management. The Ministry of Equipment is responsible for construction and maintenance of public buildings and highways. It supervises two autonomous entities, the National Equipment Pool CPNMGC) which is responsible for the maintenance of road equipment, and Labogenie, the National Civil Works Laboratory. The Highways Depart- ment prepares studies for, constructs and maintains the classified road network. Its central office, with a planning division and sub-directorates for new construction, maintenance and feeder roads, is in Yaounde. The Ministry has also ten provincial offices with maintenance and feeder roads services. In common with other Government agencies, the Department is constrained by inability to attract and maintain qualified engineers and other specialists. Coasideration has therefore recently been given to transforming it into an independent Highway Authority or, as a first step, to establishing an autonomous administration for the paved network. A study of this question is being prepared under the Fifth Highway Project and the results are expected to be available in the second half or