Uganda - Road Development Program Project (Phase 1) (RDPP1)

Report No. PID6997 PID6997.TXT Project Name Uganda-Road Development Program, (@+) ... Phase 1 (RDPP1) Region Africa Sector Transportation Project ID UGPE2970 Borrower Republic of Uganda Implementing Agency Ministry of Works, Housing and Communications Contact Address P. 0. Box 7270 Kampala, Uganda Telephone: 256-41-320101/9 FAX: 256-41-320135 Date of this PID May 4, 1999 Appraisal Date March 12, 1999 Projected Board Date June 29, 1999 Country and Sector Background 1. Since the late 1980s, Uganda has been one of the fastest growing economies in Africa. The Government has developed a comprehensive policy and institutional reform program designed to deregulate the economy, eliminate direct state involvement in all but the essential public services, and improve institutional efficiency; and has embarked on a major privatization program, a comprehensive civil service reform and public expenditures reform, for both development and recurrent budgets, and a decentralization process. 2. As part of the overall strategy to promote growth and poverty alleviation, the Government has prepared a 10-year Road Sector Development Program (RSDP - 1997/8-2006/7) for main roads which aims to provide an efficient, safe and sustainable road network in support of market integration and poverty alleviation; to improve the managerial and operational efficiency of road administration; and to develop the domestic construction industry. Overall, projected total expenditure under RSDP is estimated at US$1.4-1.5 billion. Expenditures under the first phase (FY1997-2001), estimated at US$904 million, reflect a strategy focusing on the preservation and selective upgrading of existing road assets. IDA proposes to support this first phase of RSDP with an Adaptable Program Loan (APL) in four phases over seven years. This PID describes the first phase (RDPP1), which has an implementation period of five years. Program Objectives 3. The primary objective of the proposed Program is to improve access to rural and economically productive areas by removing major constraints to transport services on the country's road network. The Program would also support actions aimed at further strengthening road sector management.  Program Description 4. The main components under consideration to support the above development objectives are as follows: Phase 1: Upgrading of two highest priority roads, Busunju-Kiboga-Hoima (145 km) and (RDPPI) Karuma-Pakwach-Nebbi-Arua (Section Pakwach to Arua, 130 km), including related construction supervision. (November 1999 - June 2005). Carrying out sector policy and management studies, including those related to feeder roads; Phase 2: Upgrading of main roads to paved standard: Kampala-Gayaza-Bugema- Zirobwe-Wobulenzi (70 km), Karuma-Pakwach-Nebbi-Arua (Section Karuma to Pakwach, 110 km), and, the Kapchorwa-Suam (85 km), subject to its being found technically feasible and economically viable; as well as related construction supervision. Preparation of a Transport Master Plan (June 2000 - June 2005); Phase 3: Strengthening of Main Roads Katanguru-Kasese-Fort Portal, Kasese- Kilembe, and Equator Roads (162 km). Upgrading of selected feeder roads to main roads standard (about 300 km). Pilot project on use of new materials for stabilization of low cost roads and construction of new Road Agency headquarters (November 2000 - October 2006); and Phase 4: Rehabilitation/improvement of selected feeder roads (about 1,000 km) (February 2002 - December 2006), to be identified by the National Feeder Roads Study which is currently being carried out under the Road Sector Institutional Support Technical Assistance Project (RSISTAP-Cr. 2987-UG). Program and Project Financing 5. Total cost of the Road Development Program is estimated at US$323 million, including US$291 million from IDA and US$32 million equivalent from the Government of Uganda. Total cost of the first phase (RDPP1) is estimated at US$92.2 million, with a foreign exchange component of US$65.95 million (72 percent). IDA would contribute about US$83.1 million (90 percent). The Government will provide the balance of US$9.1 million equivalent in local costs. Project Implementation 6. The Ministry of Works, Housing and Communications (MOWHC) would have overall responsibility for the implementation of the proposed Project. The main executing agency will be the Road Agency, which is to be established by FY 2002. In the meantime, as a transitional measure, implementation will be carried out by the Road Agency Formation Unit (RAFU), the institutional nucleus set up for the formation of the Road Agency. Project Sustainability 7. The critical factor required for sustainability of Program and Project benefits is continued Government commitment at the highest level to sector and institutional reform. By involving, right from the start, key stakeholders, including direct beneficiaries, law makers and the civil society, the framework has been set for the sustained mobilization of Government support. Another key element for sustainability is that benefits from the reforms be quickly realized by producers and road users, through improved accessibility -2 -  and infrastructure condition. To this end, RAFU will contribute to ensuring the successful and timely implementation of the proposed project. In addition, Government should strictly adhere to providing the financial requirements for road rehabilitation and maintenance projected under its rolling three-year Transport Sector Investment and Recurrent Expenditure Program. Lessons Learned 8. Experience from past projects in Uganda indicates that the main risk has been the limited capacity of the implementing agency, in particular, the ability of the agency to efficiently address problems related to contract management, contract administration, and financial and technical monitoring. The lesson from the modest success of technical assistance provided to develop the implementation and planning capacity of MOWHC is that major policy changes need full commitment from Government to ensure success. The success of any effort to improve public agency performance depends on Government willingness to grant it financial and managerial autonomy. The structure of road administration in Uganda has been subject to frequent changes, resulting in confusion, poorly organized planning administration and ineffective long term institutional and staff development. Therefore, major institutional and policy changes, including reorganization and institutional strengthening of road administration, as well as changes in the decision-making process, have been undertaken by the Government. These include establishment of an independent Road Agency by FY 2002, with RAFU in the interim. RAFU (and eventually the Road Agency) will facilitate implementation of the proposed increase in the size of the road program. Other lessons are that inadequate engineering design and weak documentation resulted in implementation delays and cost overruns. Steps are therefore being taken during Program preparation to ensure the readiness and availability of completed contract documentation before commencement of works. These steps include, inter alia, recruitment by RAFU of the proper skill mix of professional staff with the ability to oversee the work of the various consultants preparing the designs. Poverty Category 9. Not applicable. Environmental Aspects 10. The Project has been given a "B" environmental rating. Environmental and social impact assessments were carried out for each road as part of the detailed feasibility studies. The main purpose of the road specific assessments is (i) to prepare a comprehensive investigation delineating any environmental impacts of the proposed road works; (ii) to describe and quantify these impacts; (iii) to draw up feasible mitigation measures for minimizing, eliminating, or offsetting any adverse effects; and (iv) to recommend the most appropriate mitigation and/or enhancement measures. 11. The potential environmental impacts along the proposed road sections include: stripping of top soil and loss of vegetation due to the creation of borrowing pits, soil erosion on road cuts and fills and stripped borrow areas, silting of road side ditches and subsequent sedimentation downstream of water, soil contamination and water pollution due to the spillage of toxic materials, slope stability problems and slopes affected by erosion, poor drainage, - 3-  various forms of temporary land take, and impacts on human settlements (spread of HIV/AIDS and other infectious diseases, increased levels of accidents). The success of the proposed mitigation measures rests with: (i) ensuring adoption of appropriate work practices through their specification in a management plan; (ii) contract documentation; (iii) costs and schedules; and (iv) on-site monitoring. In addition, mitigation measures have been incorporated in the final road designs and contract documentation, and appropriate expertise to carry out such measures will be included in the supervision consultants' staff. 12. In addition to the road specific assessments, a Sector Environmental Assessment has been undertaken under a Project Preparation Facility (PPF) to review the environmental aspects of the RSDP with respect to (i) the adequacy of the current national system of environmental policies and regulations regarding environmental impact assessment; resettlement policies and strategies, mitigation, monitoring, and management of road work activities; (ii) the capacity of the MOWHC and the National Environmental Management Authority to commission, facilitate and implement future environmental assessments of road projects; (iii) the identification of programs and organization of training courses target to appropriate government staff and consultants in environmental assessment techniques and methodologies for road projects; and (iv) an assessment of local consultant capacity and training needs to conduct relevant environmental assessments. Funds have been provided under RSISTAP for the establishment of an environmental management/liaison unit in MOWHC. This support will provide the needed capacity to prepare the sector environmental assessment under the RSDP. Program Objective Categories 13. The Road Development Program is designed in line with the Country Assistance Strategy (CAS) road sector objectives for infrastructure strengthening and institutional capacity building as an essential first step in the CAS poverty alleviation (PA) strategy through environmentally sustainable development (EN) as the basis for private sector development (PV). The direct program objectives therefore are category EN. Project Benefits 14. The road paving and strengthening works would lead to substantial savings in vehicle operating and infrastructure maintenance costs, as well as reductions in travel time and transport costs for road users and the rural population. Since the identified subprojects are part of a comprehensive countrywide investment strategy for road development, they would contribute to fostering economic growth and poverty alleviation through improvements in market integration and accessibility. These anticipated impacts are consistent with the objective of strengthening economic infrastructure which has been identified in the CAS as a key element in the Government's growth and poverty eradication strategy. 15. The components covering sector strategy review and update studies and institutional strengthening financed through the PPF are directly targeted at rationalizing road sector management, thus addressing the pressing need for improvement of public sector implementation capacity. They will build on the institutional restructuring already started under RSISTAP. By identifying activities which can better be performed by the private sector (project - 4 -  management and execution), and target capacity building initiatives for the activities which will continue to be discharged by the state (road safety, environmental protection, budget management), these components would contribute to the Government's civil service reform program. These objectives have also been identified in the CAS as a central element to be pursued in capacity building efforts. The consultant services to be provided under RSISTAP and those financed under the PPF are expected to lead to benefits from a reduction in road subproject construction costs and from the earlier availability of improved facilities to road users. Risks 16. The main risks are that the Road Agency will not be established and operational by FY02 as scheduled, and that the financing for the maintenance works may decrease. These risks will be mitigated by tighter controls and frequent review of implementation progress with MOWHC and higher Government officials, and by getting annual agreement on targets and periodic review of progress as part of supervision. Security problems in some project areas may inhibit surveys, detailed designs and eventual construction. Contact Info: The InfoShop The World Bank 1818 H Street, N.W. Washington, D.C. 20433 Telephone No. (202)458 5454 Fax No. (202) 522 1500 Task Manager, Mr. Yitzhak Kamhi, AFTT1 (202) 473-7858 Note: This is information on an evolving project. Certain activities and/or components may not be included in the final project. Processed by the InfoShop week ending May 7, 1999. - 5 -  Annex Because this is a Category B project, it may be required that the borrower prepare a separate EA report. If a separate EA report is required, once it is prepared and submitted to the Bank, in accordance with OP 4.01, Environmental Assessment, it will be filed as an annex to the Public Information Document (PID) . If no separate EA report is required, the PID will not contain an EA annex; the findings and recommendations of the EA will be reflected in the body of the PID. -6-