Somalia - Second Mogadishu Water Supply Project

Documetit of The World Bank FOR OFFICIAL USE ONLY Report No. 8454 PROJECT COMPLETION REPORT SOMALIA MOGADISHU SECOND WATER SUPPLY PROJECT (CREDIT 1236-SO) JUNE 1, 1990 Infrastructure Operations Division Eastern Africa Department Africa Regional Office This document bas a restricted distribution and may be used by recipients only in the performance of their offcial duties. Its contents may not otherwise be disclosed without World Bank authorization.  FOR OMFIAL USE ONLY TM( WORLD BANK Washrn1ion. D C 20433 U.$ A Ot. id ODMIMv..w#al June 1, 1990 MEMORANDUY TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on Somalia Mogadishu Second Water Supply Proiect (Credit 1236-SO) Attached, for information, is a copy of a report entitled "Project Completion Report on Somalia - Mogadishu Second Water Supply Project (Credit 1236-SO)" prepared by the Africa Regional Office. No audit of this project has been made by the Operations Evaluation Department at this time. Attachment This docurnt hu a estfict dsutibution ad may be usd by rciPnu only in the pafonnance of fthit oflkcii dutioL Its contents may not othavise be discWsed without World bnk authorziXon.|  SOMALIA FOR OFmFCIAL USE ONLY MOGADISHU SECOND WATER SUPPLY PROJECT (Credit 1236-SO) PROJECT COKPLETION REPORT TABLE OF CONTENTS Pale No. Preface . . . . . . 1 BaiDate a t a. 1i Highlights . . . . . .v . . . . . . . . v I. INTRODUCTION Country Background . . . . . . . . . . . . . . . . . 1 ProJect Background .. . ........ 1 The Sector . . . e . * . . . . . . * 2 II. PROJECT PREPARATION AND APPRATSAL OrAtgn .v..vv 4 Preparation and Justification . . . . . . . . . . . . 5 Project's Role in the Long-Term Plan . . . . . . . 6 Project Description ................. 6 III. PROJECT IMPLEMENTATION. OPERATION AND COST Loan Effectiveness and Project Start-up . . . 7 Revisions . . . . . . . . . . . . 4 8 Implmentation Schedule 4944. 4999..9.4. 8 Procurement . . 9 9 9 4 9 9 9 9 9 9 9 9 9 10 Cost and Disbursem_nt .............. .. 11 Operations . . . . . . . . . . . . . . . . . 12 Performance of Consultants, Contractors and Suppliers 13 Performance of the Borrower 94.9.9.9. 9994 15 IV. OPERATING PERFORMANCE Market . . 9 . . 9 . . 9 9 9 9 9 O O 4 9 9 * 15 Project's Role . . . . 15 Project Spin-off .49.99.99999999494 16 V. FINANCIAL PERFORMANCE Advisory Assistance .... 16 Introduction of the Commercial Accounting System . . 17 Financial Results . . 9 9 4 9 . . . . 17 Rate of Return 4 9 * 18 Billing and Collection .. . . . . . . . . . . . 18 Tariffs . . . 9 . 9 . . . 9 . . . 9 9 9 9 9 4 * * 19 Auditing . . . . . . . . . . . . . * * . * * . 20 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents m ay not otherwise be disclosed without World Bank authorization.  TABLE OF CONTENTS (Cont.) Pa.e No. VI. INSTITUTIONAL PERFORMANCE anagement and Organizational Effectiveness . . . . . 20 Staf Recruitment, Manpower Development and Training . 21 VII. PROJECT JUSTIFICATION Project Achievements ............... 21 Rate of Return . . . . . . . . . . . . . . . . . . 21 VIII.BANK PERFORMANCE . . . . . . . . . . . . . . . . . . 21 IX. CONCLUSION . . . . . . . . . . . . . . . . . . . . . 22 1 - Implementation Schedule 2 - Description of Procurement and Works carried out under Construction and Supply Contracts 3 - Project Cost Estimate 4 - Water Requirements 5 - Consumer Connections 6 - Coposition of Annual Consumption 7 - Financial Statements 8 - Economic Rate of Return (ERR) Recalculation  SOMALIA MOGADISHU WATER SUPPLY PROJECT (Credit 1236-SO) PROJECT COMPLETION REPORT PREFACE This report presents the results of a review of the completion of the Mogadishu Second Water Supply Project, for which Credit 1236-SO of US$ 15.0 million was made to the Government of Somali, to be relent through a subsidiary loan agreement to the Mogadishu Water Agency (MWA). The Credit Agreement was signed on May 26, 1982 and became effective October 12, 1982. The original closing date was December 31, 1985, but it was first extended to December 31, 1986 and finally to December 31, 1987. The date of final disbursement was June 13, 1988. Attached is a Project Completion Report (PCR) prepared by the Infrastructure Operations Division of the Eastern Africa Department. Regional division staff undertook a project completi.-ln mission in January 1989 to gather information for the PCR and recviewed the Appraisal and Loan Documents, the President's Report and other information in Bank Group files. A completion report was provided by MWA. This PCR was read by the Operations Evaluation Department (OED). The draft PCR was sent to the Borrower on April 6, 1990, for comments by May 21, 1990, but none were received.  1U SOMALIA MOOADISHU SECOND WATER SUPPLY (CREDIT 1236-SO) PkOJECT COMPLETION REPORT (Credit 1240-Sg) SASIC DATA SHEET KEY PROJECT DATA Appralial Actual or item Estimate Current Estimate Totel Project Coat 42.3 40.2 Underrun (X) 5X Credit Account (US* million) 16006 15.00 Amount Disbursed (US$ million) 16.00 14.40 Date Physical Components Completed 06/80/85 12/81/85 Proportion Completed by Above Date 98X 166x Proportion of Tim. Overrun -- 251 Economic Rate of Roturn (S) s.ex 4.60 Financial Performance Less then satistactory Institutional Performance Less than satisfactory OTHER PROJECT DATA Issues Paper 08/11/80 Decision Memorandum 08/28/80 Negottatione 03/91-06/82 Staff Appraisal Report 03/28/82 Board Approval 04/27/82 Credit Agreement Date 06/26/82 Effectivenese Date 08/15/82 10/12/82 Closing Date 12/81/86 12/81/88 12/81/87 12/81/87 L/ Borrower Somali Democratic Republic Executing Agency Mogadishu Water Agency Fiscal Year of Borrower January 1 to December 31 Follow-on Project V Somalia Intfrstructuro Development Project COUNTRY EXCHANGE RATES Name of Currency (Abbreviation): Somali Sh!lling (SoSh) Appraisal Year Average : USS I a SoSh 12.59 Intervening Year's Ave. : USS 1 a SoSh 88.0 Completion Year's Ave. : US8 1 = SoSh 42.0 1/ Date of final disbursement: 06113188 21 Presently under preparation. It will include additional technical assistance and training component for MWA.  III mzs User Mab *Aber Rs*miMi'/ of of of ll- nttee P 1temotmo *ppr.i., 5/ I#IJ81 1 1 l b - - - @1/5 Pteoal 5/ ow/n1 1 I I b - - - @80 PoIb_ l 5/ I 1 1- - 06t Subtl J WIl 11-12 8 1 J abc 1 2 F 0/06/ 2 own a 2 3 8b 2 2 FM 10/11/ S 9Iwo V 9 1 2 Q 8 a.. (baec to office rap.) 1Walli 4 09-04/ 1 1 1 a 2 2 FM @6/040/0 S 06/6a 2 1 2 .b 21 FM 07/51/64 a 10-/8 2 1 2 . 2 1 RI @8/12/0 AVulIabl* PoJeDelopemt ov.t11 7 9 1 2 2 1 a 9/86/86 0 06/86 2 1 28aI 2 2 1 2 @14/ e 11/86 2 1 2 8b 1 2 1 2 @3//5 10 0/57 2 1 2 b 2 1 2 0o/w1/ 1 07/5 2 1 2 .8 1 2 1 2 09/21/5 12 11-12/5 2 a a .b aS. (ldc to Office aw VA Onltey) 02/08/8 1s 01 82 2 4 .b *n.e. (lad Off ce UWaect Rly) @6l/ ow 61AtO%Dl 17 as TorAL 90 1/ a . eAlteeresz b - fl e * * tatl 2/ 1 problem from or alstr problem; 2 * --ee preins; a * mjor pseblm 8/ 1 * laprel; 2s- .timrV; 8 a developing 4/ P * ftat_ing; U 0 _telat 7 ttcla P * polltl 5/ .81tnt w.1Ab mawlolem of Fiet Project 6/ .8tn. .8th asapoetee staeala of Fir" oet 7/ .81t.s with Idmntification Ifeetto of t.8 S l If se leoiQPWAt ProjeCt G/ Poject Ci Iottle Wleele. I61"t with Pnraenetle. Htemia of het Smalls Iafretrucbaro elcs,mat Project.  iv CUMULATIVE DISBURSEMENTS ---------------Fiscal Year---- 1983 1984 1985 1986 1987 1988 Appraisal Estimate (USS million) 3.30 8.40 13.35 15.00 Actual (USS million) 6.53 S.S2 11.69 12.63 13.65 14.4) Actual as 2 of Estimate 198.0 113.3 87.6 84.2 91.0 96.0 Actual as S of Original Amount 43.6 63.5 77.9 84.2 91.0 96.0 Appraisal Estimate (SDR million) 2.95 7.50 11.93 13.40 Actual (SDR million) 6.05 8.89 11.08 11.99 12.83 13.39 Actual as 2 of Estimate 205.3 118.5 92.9 89.5 95.7 99.9 Actual as 2 of Original Amount 45.2 66.3 82.7 89.5 95.7 99.9 z W 2 i 93 18 Is6E Isse 13t7 Is88 FISI A_ Y-Afa6S 5F%rMAT6?-- ACTUAL.  v SOMALIA MOGADISHU FSCOND WATER SUPPLY PROJECT (Credit 1236-SO) PROJECT COMPLETION REPORT HIGHLIGHTS The Project was prepared under Credit 822-SO (first project) which was only an interim measure to improve the water supply in Mogadishu. Under the Project the production capacity was increased from 17.8 m m3lday to 48.5 million m3/day (to meet the demands up to year 1986). It also provided technical assistance to strengthen the Mogadishu Water Agency's institutional and operational effectiveness. The major highlights of the Project are as follows: (a) Physical (i) the physical implementation was generally satisfactory. The new scheme was completed on time and within the cost estimate (para 3.08, 3.18 and 3.23). (b) Institutional (i) the management of the Mogadishu Water Agency (MWA) and the MWA's Project Management and Planning Unit was increasingly efficient in handling the procurement, supervision and disbursement matters of the physical project components (para 3.37); (il) the technical departments of MWA have made significant efforts to keep the water supply running at maximum capacity despite the severe shortage of spare parts (para 6.04); and (iii) MWA's institutional development and strengthening was not fully achieved. This is mainly due to inadequate staffing and discipline of the staff, which cannot be improved unless MWA's salary and wage structure is revised. This has now been recognized both by the Ministry of Mineral and Water Resources and MWA and it would be made as a precondition for further training and technical assistance to MWA envisaged under the Infrastructure Development Project presently under preparation (para 4.06).  vi (c) Technical (i) Government's reluctance to increase the water tariffs as required and the low billing and collection performance caused severe cashflow problems during the implementation period. The latest tariff increase in December 1988, and the first step towards a progressive tariff structure is expected to improve the situation in the future (para 5.10); and (ii) MWA's cash position is further adversely affected by the high accounts receivable which varied widely depending mainly on the payments by government institutions which account for about half of the water sales revenues (para 5.05).  SOMALIA MOGADISHU SECOND WATER SUPPLY PROJECT (Credit 1236-SO) r.JE%CmL VAE1"kION' RE*POR