China - Xiaolangdi Multipurpose Project : Stage II

Document ot the International Bank for Reconstruction and Development and the International Development Association Report No. 16274-CHA PROJECT APPRAISAL DOCUMENT ON A LOAN IN THE AMOUNT OF US$430 MILLION EQUIVALENT (US$230 MILLION AND DEM 346.5 MILLION) TO THE PEOPLE'S REPUBLIC OF CHINA FOR THE XIAOLANGDI MULTIPURPOSE PROJECT: STAGE II June 3, 1997 Rural and Social Development Operations Division China and Mongolia Department East Asia and Pacific Regional Office  CURRENCY EQUIVALENTS (as of March 1, 1997) Currency = Renminbi Currency Unit = Yuan (Y) Y 1.00 = 100 fen Y 1.00 = $0.12 $1.00 = Y8.3 FISCAL YEAR January I - December 31 ABBREVIATIONS AND ACRONYMS USED AS - Antiepidemic Station CAS - Country Assistance Strategy CCPN - Central China Power Network CPLG - Central Project Leading Group DSP - Dam Safety Panel EIA - Environmental Impact Assessment EMO - Environmental Management Office EMP - Environmental Management Plan GOC - Govemment of China GWh - Gigawatt hours ICB - International Competitive Bidding LRM - Lower Reach Model MWR - Ministry of Water Resources NCB - National Competitive Bidding NCPN - North China Power Network NCHEI - North China Hydroelectric Institute PAB - Provincial Audit Bureau PRO - Provincial Resettlement Office RPDI - Reconnaissance Planning and Design Institute SAA - State Audit Administration SBD - Standard Bidding Document SOE - Statement of Expenditures WRPI - Water Resources Protection Institute XECC - Xiaolangdi Engineering Consulting Company YRCC - Yellow River Conservancy Commission YRCCRO - Yellow River Conservancy Commission Resettlement Office YRCHU - Yellow River Central Hospital Unit YRWHDC - Yellow River Water and Hydropower Development Corporation YRWHIDCRO - YRWHDC Resettlement Office Vice President Jean-Michel Severino, EAP Director Nicholas C. Hope, EA2 Division Chief Joseph Goldberg, EA2RS Staff Member Daniel Gunaratnam, Principal Irrigation Engineer, EA2RS  CONTENTS Project Financing Data ....................................................................1 Block 1: Project Description ....................................................................2 1. Project Development Objectives ....................................................................2 2. Project Components ....................................................................2 3. Benefits and Target Population ................................................................... 3 4. Institutional and Implementation Arrangements ....................................................................3 Block 2: Project Rationale ....................................................................4 5. CAS Objective(s) Supported by the Project ....................................................................4 6. Main Sector Issues and Government Strategy ....................................................................4 7. Sector Issues to be Addressed by the Project and Strategic Choices ....................................................................4 8. Project Alternatives Considered and Reasons for Rejection ....................................................................5 9. Major Related Projects Financed by the Bank and/or Other Development Agencies ...........................................5 10. Lessons Learned and Reflected in the Project Design ....................................................................5 11. Indications of Borrower Commitment and Ownership ....................................................................6 12. Value Added of Bank Support ....................................................................6 Block 3: Summary Project Assessments ....................................................................6 13. Economic Assessment ....................................................................6 14. Financial Assessment ....................................................................7 15. Technical Assessment: ....................................................................9 16. Institutional Assessment: ................................................................... 10 17. Social Assessment ....... ............................................................ I 1 18. Environmental Assessment: ................................................................... 15 19. Participatory Approach ................................................................... 18 20. Sustainability ................................................................... 18 21. Critical Risks ................................................................... 18 22. Possible Controversial Aspects ................................................................... 19 Block 4: Main Loan Conditions ................................................................... 19 23. Conditions of Effectiveness ................................................................... 19 24. Other Conditions ................................................................... 20 Block 5: Compliance with Bank Policies ................................................................... 23 ANNEXES Annex 1: Project Design Summary and Monitoring Indicators .................................................................. 24 Annex 2: Detailed Project Description ................................................................... 26 Annex 3: Estimated Project Costs .................................................................. 46 Annex 4: Cost Effectiveness and Economic Analysis Summary .................................................................. 58 Annex 5: Financial Analysis and Assumptions .................................................................. 72 Annex 6: Financial Summary .................................................................. 76 Annex 7: Procurement and Disbursement Arrangements .................................................................. 85 Annex 8: Improving Project Environmental Management .................................................................. 91 Annex 9: Resettlement Progress Report .................................................................. 97 Annex 10: Construction Schedule .................................................................... 106  Annex 11: Terms of Reference for Xiaolangdi/Sanmenxia Dams Inspection Panel ......................................................... 111 Annex 12: Guidelines for Emergency Preparedness Plan .......................................................... 113 Annex 13: Guidelines for Dam Operation and Maintenance ........................................................... 114 Annex 14: Principles for Efficient Water Delivery for the Lower Yellow River .......................................................... 116 Annex 15: Documents in the Project File .......................................................... 117 Annex 16: Project Processing Budget and Schedule ........................................................... 118 Annex 17: Statement of Loans and Credits .......................................................... 119 Annex 18: Country at a Glance .......................................................... 123  INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION East Asia and Pacific Regional Office China and Mongolia Department Project Appraisal Document China Xiaolangdi Multipurpose Project: Stage II Date: 23 May 1997 [ ] Draft [x] Final Task Manager: Daniel Gunaratnam Country Manager: Nicholas Hope Project ID: CN-PE-34081 Sector: Water Resources POC: Lending Instrument: SIL PTI: [ 1 Yes F ] No Project Financing Data [x] Loan [] Credit [ Guarantee [] Other (Specify] For Loans/Credits/Others: Amount: US$430.0 million equivalent US$230 million tranche and DEM 346.5 million trancheo. _ro-p_osed Terms: [ Multicurrency [x] Single currency Grace period (years): 5 [] Standard Variable [ Fixed [x] LIBOR-based Years to maturity: 20 Commitment fee: 0.75% Financing plan (US$ M): Source Local Foreign Total Government 1,116.0 459.2 1,570.2 Local Loans 286.6 - 286.6 IBRD Loan I - 460.0 460.0 IBRD Loan 11 430.0 430.0 Export Credit - 109.0 109.0 Total 1,402.6 1,453.2 2,855.8 Borrower: People's Republic of China Guarantor: Responsible agency(ies): Ministry of Water Resources and Yellow River Water and Hydropower Dev. Corporation Estimated disbursements (Bank FY/US$ M): 1998 1999 2001 2001 2002 2003 Annual 80.0 130.0 130.0 70.0 20.0 0.0 Cumulative 80.0 210.0 340.0 410.0 430.0 430.0 For Guarantees: [] Partial Credit [] Partial risk Proposed coverage: Project sponsor: Nature of underlying financing: Terrms of financing: Principal amount (US$) Final maturity Amortizatio_n_r file