Argentina - Flood Rehabilitation Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 18769 IMPLEMENTATION COMPLETION REPORT ARGENTINA THE FLOOD REHABILITATION PROJECT (Loan 3521-AR) January 4, 1999 Finance, Private Sector, and Infrastructure Sector Management Unit Argentina, Chile, and Uruguay Country Management Unit Latin America and Caribbean Region 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 World Bank authorization.  CURRENCY EQUIVALENTS, [exchange rate as of July 1, 1992 (fixed march 31, 1991)] Currency Unit Peso (Arg$) US$1.00 = Arg$1.00 FISCAL YEAR January 1 - December 31 VVEIGHTS AND MEASURES 1 gallon = 3.785 liters 1 mile = 1.609 kilometers I pound = 0.454 kg ACRONYMS AND ABBREVIATIONS GoA - Government of Argentina INCYTH - Instituto Nacional de Ciencia y Tecnica Hidrica National Institute of Hydrological Sciences and Technology MERCOSUR - Common Market Agreement among Argentina, Brazil, Paraguay and Uruguay PG - Provincial Governments POM - Project Operational Manual SAFP - Secretaria de Asistencia Financiera a las Provincias - Secretariat for Financial Assistance to the Provinces SOEs - Statement of Expenditures SUCCE - Sub-Unidad Central de Coordinacion para la Emergencia Central Sub-Unit for the Coordination of Emergencies SUPCE - Sub- Unidad Provincial de Coordinaci6n para la Emergencia Provincial Sub-Unit for the Coordination of Emergencies UEC - Unidad Ejecutiva Central Central Executing Unit Vice President: Shahid Javed Burki Country Director: Myma Alexander Sector Director: Danny Leipziger Team Leader: Abel Mejia  FOR OMCIAL USE ONLY IMPLEMENTATION COMPLETION REPORT ARGENTINA THE FLOOD REHABILITATION PROJECT (Loan 3521-AR) Table of Contents Page Preface ................................................................................ i Evaluation Summary ................................................................................ ii Part I - Project Implementation Assessment A. Background .1 B. Project Objectives and Description .3 C. Project Design and Preparation .6 D. Project Implementation .7 E. Project Results .9 F. Project Sustainability .13 G. Bank Performance .14 H. Borrower Performance .15 I. Assessment of Outcome .17 J. Future Operation .17 K. Project Sustainability .17 L. Key Lessons Learned .18 Part II - Statistical Annexes Table 1: Summary of Assessments .21 Table 2: Related Bank Loans/Credits .22 Table 3: Project Timetable .23 Table 4: Loan Disbursements .24 Table 5: Key indicators for Project Implementation .25 Table 6: Key Indicators for Project Operation .26 Table 7: Studies Included in Project .27 Table 8A: Project Costs .31 Table 8B: Project Financing .32 Table 9: Economic Benefits (Avoided Damages) .33 Table 10: Status of Legal Covenants .34 Table 11: Compliance with Operational Manual Statements .35 Table 12: Bank Resources: Staff Inputs .36 Table 13: Bank Resources: Missions .37 Annex 1: Housing Component .39 Annex 2: Project Summary Calendar .40 Appendixes: A Aide-Memoire ..................... ........................................................ 41 B - Borrower contribution to the ICR ..................................................... ........................ 52 C-Map ............................................................................. 65 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 World Bank authorization.  IMPLEMENTATION COMPLETION REPORT ARGENTINA FLOOD REHABILITATION PROJECT (LOAN 3521-AR) Preface This is the Implementation Completion Report (ICR) for the Flood Rehabilitation Project in Argentina, for which Loan 3521-0, 3521-S, and 3521-A totaling in the amount of US$170.0 million equivalent was approved on September 29, 1992 and made effective on March 24, 1993. The loan was closed on March 31, 1998, five and half years after Board approval and three years beyond the original closing date of March 31, 1995. Final disbursement took place on July 22, 1998 under converted Loan 3521A-AR, leaving a balance of US$2.8 million in the loan account which was canceled on July 31, 1998. The ICR was prepared by Adrien Campbell from the Finance, Private Sector and Infrastructure Department of the Latin America and Caribbean Region. Abel Mejia (Task Manager) and Armando Araujo, former Task Manager, made contributions to the report. The ICR was reviewed by Asif Faiz (Sector Leader for Argentina, Chile, and Uruguay CMU), Maria Victoria Lister (LCSFP), Morag Van Pragg (LOAEL) and Ferenc Molnar (LEGLA). Preparation of this ICR started during the Bank's final supervision mission (March 9-26, 1998). The ICR is based on: (i) trimester project advancement reports and a project completion report prepared by the borrower's executing unit, Sub-Unidad Central de Coordinacionpara la Emergencia (SUCCE); (ii) materials in the Bank's project files; (iii) Bank staff s experience and observations during visits to the field and discussions with the SUCCE staff; (iv) and the Bank's Back-to-Office reports and aide-memoire, which are in the project files. The borrower also contributed to the preparation of the ICR by assisting the Bank to effectively participate in discussions during the missions, and commenting on the earlier draft of the ICR. The current ICR takes into account the comments made by the Borrower. The Borrower's contribution is included as Appendix B.  ii IMPLEMENTATION COMPLETION REPORT ARGENTINA FLOOD REHABILITATION PROJECT (LOAN 3521-AR) Evaluation Summary Project Objectives The project was designed as an emergency response to damage from severe floods caused by the 1991/92 El Nifno phenomena, which created US$905 million in economic losses. Damage occurred in the seven littoral provinces of Argentina--Buenos Aires, Chaco, Corrientes, Entre Rios, Formosa, Misiones, and Santa Fe--of the Parana, Paraguay and Uruguay River basins during the last months of 1991 and the first months of 1992. The project objectives helped finance flood reconstruction needs in the seven affected provinces and provide a sound institutional framework for the coordination and implementation of the overall Government rehabilitation program. The specific project activities, designed to restore normal economic activity in the areas affected, included assisting in the rehabilitation of essential transport infrastructure, social infrastructure, and flood control works. The objectives of the rehabilitation were to restore service capacity of damaged infrastructure. In addition, project design included: (i) a technical assistance component for studies to be done for the preparation of a follow-up project to increase the optimal level of protection against severe recurrent floods; and (ii) the financing of an interim early flood warning system that would be upgraded and finalized during the follow-up operation. Project design was based on the Bank's previous experience with similar reconstruction efforts elsewhere and Bank norms for such projects. The project financed rehabilitation of transport and power infrastructure, emergency flood control works, housing through a self-help scheme, education and health facilities and water supply and drainage works; and technical assistance to strengthen and improve the capacity of institutions responsible for project implementation, flood forecasting and mitigation of future disasters. Major Factors Affecting Project Implementation The project was completed in five years, three years beyond the overly unrealistic completion timeframe for such a large-scale rehabilitation program. Nevertheless, 90 percent of the physical works were completed by the end of 1995. The major obstacles affecting implementation were as follows: * Project Loan effectiveness was not achieved until six months after Board approval. This delay was due to time consuming bureaucratic steps required for loan signing and the subsequent approval of the subsidiary loan agreements with the affected  provinces. Fortunately, some activities and project implementation arrangements were started earlier, with US$20.0 million from the Provincial Development I Project (Loan 3280-AR), which was amended to address the flood emergency. * Some delays may also be attributed to the lack of experience by the provincial executing agencies in regards to the Bank's procurement and administrative procedures. * In 1995, two years into implementation, the national government became financially constrained by the Tequila crisis and began accruing delays in providing its share of counterpart funds; this continued each year thereafter until May 1997 when the government caught up with its obligations. The same occurred with the provincial governments and their obligatory share of counterpart funds in 1996. These delays resulted in late payments to contractors and several slow downs; in some cases the contractors stopped construction until back payments were received. * Further delays, of 18 months are attributed to the additional time required to correct engineering design flaws discovered during construction of certain more complex works. Even though the project was executed in five years, this was still a reasonable timeframe considering: (i) the size and technical complexity of the project; (ii) the number of sectors it encompassed; (iii) that the works were small in scale and spread out in remote locations; and (iv) the number of new executing agencies without experience in Bank operations. Project Results Despite the initial delays, the project fully achieved its physical and non-physical objectives. The rehabilitation of key economic and social infrastructure has provided adequate protection to the affected populations and urban economic activities, as shown in subsequent flood episodes, including the 1997/98 El Nifio. Moreover, the key stakeholders in the provinces have realized the importance of properly operating and maintaining the newly rehabilitated infrastructure. As mentioned, the physical investments made have been extremely beneficial given the recent floods and an economic analysis of investments made in eight principle urban areas show an internal economic rate of return of 35.1 percent. In regards to the social programs that were executed, the impact has been equally as beneficial, especially in poverty alleviation through the project's self-help housing program. The institutional strengthening and the studies executed have effectively improved emergency coordination and identified a strategy for future structural and non-structural investments. Project Sustainability and Future Operation The achievement of the project's objectives should be sustainable; the key indicators for project sustainability being:  iv * Institutional/Management Effectiveness. The establishment of the borrower's central executing agency, Sub-Unidad Central de Coordinaci6n para la Emergencia (SUCCE) and the provincial executing agencies, Sub- Unidad Provincial de Coordinaci6n para la Emergencia (SUPCEs), provided an effective institutional framework to coordinate emergency recovery actions between the federal and provincial governments. It is recommended that these units be converted into permanent entities within the Ministry of Interior and the provincial governments. * Housing Program. A post implementation risk identified was that after completion of the new homes, families would sell their homes and return to the areas unprotected by the defense system or within the 50-year flood plane. However, this risk has not appeared to materialize to date. The improved sanitary and health conditions, along with the provision of social programs, are strong incentives to prevent a return to former precarious conditions, continued occupancy of the new homes by the original beneficiaries is highly likely. * Public Awareness/Commitment. The 1990's have witnessed an alarmingly increasing number of severe floods, especially the latest linked to the 1997/98 El Nifno phenomenon. During the past five years, affected citizens have directly benefited from the flood protection defenses and the associated economic and life saving potential several times. With such a strong visual and mental experience associated with the protection works, the support from the local population, the media, and the politicians has come wholeheartedly. Sustainable commitment has been further demonstrated by the eagerness of local populations to have the works that are being financed by the follow-up Flood Protection Project to start immediately in their municipalities. * Technical and Economic Factors. The investments in civil works were aimed at rehabilitating existing infrastructure through a quick and locally competitive tendering process that assured a cost-effective solution. The follow-up project aims to increase the level of protection to its optimal level, considering the socio-economic factors involved. Technical sustainability and realization of the investment's economic return should be guaranteed through appropriate operation and maintenance that is carried out when there is strong public and political support. * Flood Protection Project. The activities that are being carried out under the follow- up Flood Protection Project will enhance sustainability. The new local laws and river-basin-wide coordinating arrangements should help strengthen the local governments' flood preparedness and mitigation systems. Furthermore, the new project will ensure that the well-trained and competent staff of SUCCE and the SUPCEs continue to provide the strong technical and institutional support required for sustaining project investments. * El Nino Emergency Flood Project. This new emergency operation includes the rehabilitation of structural damage from the 1997/98 El Ni-no phenomenon in the littoral provinces of Argentina, thus assuring major repairs of urban defenses  V necessitated by the prolonged floods. In addition, the project will include the northwestern provinces of Argentina for both preventive structural measures and non- structural measures, which will be carried out to mitigate the potential impacts of La Nifia in late 1998. Assessment of Outcome and Key Lessons Learned This project on a whole is rated fully satisfactory. Even though the project was completed with delay (due to financial constraints and an unrealistic implementation plan), all objectives were achieved. Project benefits have already been realized during the recent floods. The key lessons learned from this project are as follows: Emergency Project Design. One of the key lessons, already applied to other Argentine flood rehabilitation and protection projects, is that physical rehabilitation alone is not sufficient to sustain long-term benefits, as well as provide an effective level of protection. Even in emergency projects, funding should be allocated for the development of non-structural measures that establish the capacity to manage future emergencies at provincial and local levels. Although the project took an additional three years to complete beyond its original two-year design, its implementation still has to be considered an achievement given the multi-sector scope of the project. These delays resulted from an initial lack of executing units with experience in Bank funded operations, the lack of detailed engineering plans for the works, subsequent budget constraints, and the need to redesign some complex works. The successes achieved can be replicated and further improved by considering the following principles: (i) using simple and easy investments to implement with adequate design standards; (ii) using a flexible project design that is not over-specified; (iii) ensuring participation of interested provinces with adequate counterpart financing from the tax revenue sharing system; (iv) maintaining competent local executing units with the capacity to deal with emergencies; (v) enabling flexibility to shift funds among eligible provinces, including a portion of funds as unallocated for unforeseen activities; and (vi) preparing a well formulated but simple project operation's manual. Consideration should be given to realistic completion schedules when preparing emergency loans, especially ones as complex as this one. Policy Lessons. (a) The institutional set-up of the SUCCE-SUPCE framework was crucial to the project's implementation and its sustainability in maintaining an effective method of communication and coordination among the provincial and federal governments. Project activities progressed well because of decentralized decision making by provincial implementing units, with relatively light handed central Government control, and the fact that the provincial implementing units also remained small and focused on establishing effective collaboration with established line agencies. (b) Emergency operations that involve voluntary resettlement through a housing component should assist in the definition of land use regulations that forbid new inhabitants from resettling the land that is at risk. Otherwise such legal and institutional aspects should be addressed in a follow-up project to prevent such human occupation and settlement of land in high-risk areas (in this case, the follow-up Flood Protection Project).  vi (c) Emergency recovery assistance in most developing countries should be viewed as only a first step to restore economic and financial activities. The Bank's assistance should continue in a follow-up operation that provides assistance to implement medium to long-term risk mitigation and prevention goals established during the emergency operation. (d) Restricting development in floodplains and preserving the ecosystem are better achieved and supported through the use of fiscal incentives, effective land use and management practices, and sound govermmental policies and programs aimed at avoiding further environmental degradation. These approaches to risk prevention and mitigation are less costly and more effective than physical measures, as recited in the Bank's policy paper on Water Resources Management (April 30, 1993) and incorporated in the design of the follow-up Flood Protection Project. Implementation Lessons. (a) In view of the emergency and because the repair and reconstruction works were relatively small in size and executed in scattered locations in seven provinces, procurement procedures for eligible subprojects were simplified in line with Bank guidelines to facilitate speedy implementation. As nearly 99 percent of the works was awarded through national competitive bidding (NCB), quotation, or direct contracting, the Bank's prior review was limited to the first two NCB contracts per year with the remaining review conducted on a spot-check basis in the field. In order to provide assurance that the Bank's procurement procedures and funds were being properly used, project audits took place semi-annually instead of annually. (b) Delays occurred with respect to the implementation schedule because SUCCE's analysis of the proposed sub-projects for their technological and environmental appropriateness and adequacy was not considered. An adequate time allowance should be made for such reviews in all emergency operations, as sub-project evaluation is not based on an ex-ante project evaluation process. (c) Experience has shown that multi-sector projects tend to be difficult to implement and complete on time. However, in this project delays were attributed to particular engineering and construction problems and counterpart funding shortages, which could not be foreseen at the start. The multi-sector nature of the project had no significant influence on implementation delays. (d) The use of a structured implementation framework with a very capable project executing unit staffed by a team of experienced consultants in several infrastructure sectors of the operation was a key factor in the successful implementation of this emergency operation. The staff should be recruited competitively and paid according to market standards to guarantee a high level of quality and to minimize staff turnover. (e) Emergency operations require a strong commitment not only from the Borrower, but also from the Bank in terms of supervision. This project benefited from several supervision missions that included extensive field visits and on-site inspections. Emergency loans need to be designed with a flexible implementation framework and  vii visible Bank presence in order to assist in adapting the project to meet unforeseen demands and to successfully manage and remove implementation bottlenecks. Community Participation. The participation of beneficiaries and affected parties in planning, designing, implementing and managing the project is essential to ensure a satisfactory outcome of an emergency project. This was especially relevant in the housing and shelter component. The interaction in local communities between beneficiaries and the local authorities resulted in the timely availability of construction materials and the incorporation of local customs in the architectural design of the new houses. The housing program was also essential in attending to the poor (beneficiaries with an average household income of US$156) and encompassing the participation of women, whom input 36 percent of the total labor. Project Financing. In order for an emergency loan to be implemented quickly, overall Bank financing of an emergency operation should be a minimum of 60 to 70 percent. This minimizes the amount of counterpart funding requirements and unforeseen fiscal adjustments required by the federal and local government and allows what little government resources that remain to be used in other areas of relief that are not covered by the Bank's project.  IMPLEMENTATION COMPLETION REPORT ARGENTINA FLOOD REHABILITATION PROJECT (LOAN 3521-AR) Part I - Implementation Assessment A. Background The 1992 Flood 1. Five of the ten most severe floods (measured in terms of annual daily peak charges) recorded this century have occurred since 1982, with the 1982 event as the largest and the 1992 flood as the second largest of the century. At the end of 1991, unusually heavy rains began to fall in the catchment areas of the Paraguay, Parana and Uruguay Rivers. As in most normal flood years, these torrential downpours produced massive flows into the Parana River. These peak flows in the rivers were higher and larger partly because the basin was already saturated and the additional heavy rains in the middle of the Paraguay River Basin that began in March 1992 led to peak river flows that coincided with the Parana's peak flows. Ultimately, the combined Paraguay and Parana River flows crested at 55,000 m3/s (recorded in Corrientes City) in May/June 1992 at almost four times the yearly average, affecting all seven littoral provinces in the Parana Basin and contiguous areas of Brazil, Paraguay and Uruguay. Of the seven provinces (Buenos Aires, Corrientes, Chaco, Entre Rios, Formosa, Misiones and Santa Fe), Formosa was the hardest hit, followed by Chaco, Corrientes, and Entre Rios. The 1992 event recorded economic loses of US$905 million, which has only been exceeded by that of the 1982/83, the largest recorded flood of the century. The 1992-damage tally showed substantial output losses and that nearly one-third of the damage occurred to the commerce and industry, while the poor in the peripheral urban areas suffered disastrous consequences. In fact, the study carried out during project preparation reported that the social ramifications to be more adverse than the effects on the productive sectors, during this particular event. Sector Objectives 2. Clear, long-term sector objectives in relation to floodplain management prior to the emergency were essentially non-existent. When disaster struck, the Central Governnent established a national program to attend to the afflicted and by doing so, the program became the sector objective of the Government at the time of project preparation. The program can be described in three distinct phases. First, it established relief and rescue operations concentrating on the evacuation of the affected population and providing them with shelter, blankets and food rapidly. Secondly, river defenses were fortified in cities and towns near the rivers. Then the authorities requested the Bank to assist in the preparation and financing of a program (Programa de Rehabilitaci6npara las Inundaciones - PREI) to rehabilitate damaged infrastructure and  2 identify the basic requirements and objectives for preventing the recurrence of similar damage in the future. Concurrently the Bank was asked to help the borrower meet these additional requirements. Floodplain Management in Argentina 3. River basin and floodplain management is a fragmented and disorganized sector that lacks: adequate infrastructure; appropriate environmental standards and regulations; and institutional capacity. The two most generic and notable features of the sector are that: (a) provinces have primary jurisdiction over water resources (except for navigation) despite the reality that many river basins are inter-provincial, while the national legal and institutional framework does not adequately address this imbalance; and (b) water resources characteristics vary greatly among the country's regions and provinces and there is no consolidated policy and institutional framework which has resulted in significantly uneven and poorly coordinated infrastructure development. 4. At the national level, the institutional framework has gone through some organizational changes as of January 30, 1998, with the Secretariat of Natural Resources and Sustainable Development, under the Office of the President, being responsible for establishing national water policy. Formnerly this responsibility use to fall under the Direcci6n Nacional de Recursos Hidricos (DNRH), a department of the Secretaria de Obras Publicas of the Ministry of Economy and Public Works and Services. This new Secretariat has four under-secretariats, two of which are directly linked to water management: the Under-Secretariat of Water Resources and the Under-Secretariat of Environmental Regulation. The prior consists of two national bureaus. The first is responsible for: (i) preparing proposals and carrying out policies, programs and projects dealing with water resources and aimed at achieving sustainable development; (ii) proposing and promoting strategies aimed at integrated river basin management; and (iii) evaluating and promoting the setting and application of regulations aimed at water resource preservation and protection. The second bureau is the Water Resource Administration, which is in charge of carrying out projects and works and providing services. 5. At the provincial level, the institutional situation is characterized by great diversity, but at least two features are noteworthy. First, there has been a proliferation of institutions that have overlapping missions and duties frequently involving more than two agencies belonging to different Ministries or Secretariats. Second, in general, the overall management of water resources is not well integrated under a clearly designated water agency. In terms of inter- provincial water management, several river basin committees have been created as agencies that coordinate water management among provinces linked by a common river basin. Unfortunately, most are not operational, mainly because of budget restraints resulting from the recent fiscal reforms. These committees are located outside of the littoral region of Argentina and are essentially financially supported by contributions from hydroelectric companies in the affected basins. 6. In regards to the legal framework, there is significant national water legislation, however, it lacks the basic framework which would allow provinces to establish consistent regulations for users' rights and obligations, the economic value of water, the river basin as the primary management unit, multi-sectoral user's organizations, and others. In part, this relates to the lack  3 of a national water resources management policy. At the provincial level, legal frameworks are unevenly developed and inconsistent. Some provinces have well developed regulations while others have no specific laws on a number of issues that affect them, such as organization of users, water rights, management of aquifers, etc. Some provinces do not even have specific water legislation. In other case, existing legislation is very old and does not incorporate new concepts such as multi-sectoral management, economic criteria, institutional development, etc. Bank Sector Lending 7. The 1991/92 flood generated approximately US$905 million in economic loses, which was the catalyst in the development of a long-term strategy to cope with recurrent floods in the Parana River basin. The Bank's overall strategy calls for: (i) the improved management of the basin's resources; (ii) a well-defined investment plan in structural measures; and (iii) the definition of non-structural measures. Conceptually this strategy is in agreement with the integrated river-basin approach, which has been identified throughout the world as a useful means of dealing with broad water issues, including flow regulation and flood control alternatives. To further implement this approach the Bank continues to support the country's ongoing efforts of flood protection through two additional loans, the Flood Protection Project (Loan 4117-AR) and the El Nifno Emergency Flood Project (Loan 4273-AR). 8. The Flood Protection Project is a US$420.0 million follow-up project that is 47.6 percent financed by the Bank and 28.6 percent co-financed by The Export-Import Bank of Japan (JEXIM). Its objective is raising and completing the level of defense of key economically important locations throughout the Parana Basin via structural and non-structural measures. The components to this project lie in full support of the Government's new strategy in coping with flooding in the Parand basin. 9. The third loan, the El Nifio Emergency Flood Project, is a US$60.0 million operation that is 70.0 percent financed by the Bank and has the objective of providing an immediate source of financing for investments that will offset the damaging impact of the 1997/98 El Nifno in the littoral provinces (specifically along the Uruguay River), and also in the semi-arid northwest of Argentina which is susceptible to flash floods. The northwest provinces will benefit from the components specifically directed towards these provinces, which include investments, institutional strengthening and basin flood-risk studies. B. Project Objectives and Description Objectives 10. The objectives of the Flood Rehabilitation Project were to help finance flood reconstruction needs in the seven afflicted littoral provinces and provide a sound institutional framework for the coordination and implementation of the overall Government rehabilitation program. The specific project activities, designed to restore normal economic activity in the areas affected, included assisting in the rehabilitation of essential transport infrastructure, social infrastructure, and flood control works. It should be noted that these activities were not designed to provide the optimal economic protection against recurrent floods. For the latter possibility,  4 technical assistance was provided, under the project, to prepare for longer-term flood managing by improving hydrological forecasting and prepare a prevention investment program to be financed by a follow-up project. Description 11. Project design was based on the Bank's previous experience with similar reconstruction efforts elsewhere and Bank normns for such circumstances. The project financed rehabilitation investments in key infrastructure and its equipment for: (a) transport and energy; (b) emergency flood control works; (c) housing; (d) education and health facilities; (e) water supply and drainage; (f) additional requirements to be determined after final damage assessment; (g) technical assistance to strengthen the institutions involved in project implementation; and (h) flood forecasting and prevention of future disasters, including technical assistance. (a) Transport and Energy: Funding for the: (i) rehabilitation of road works, urban streets, railroads, ports and electricity distribution infrastructure damaged by the floods or by the heavy traffic of construction equipment and trucks used in the struggle to reinforce embankments against the surging flood waters; (ii) replacement of destroyed electrical equipment; and (iii) rehabilitation of roadside defenses. (b) Emergency Flood Control Works: For the financing of: (i) strengthening of embankments that were either seriously eroded or washed out; (ii) the replacement of dike sections in danger of collapsing; (iii) repair and replacement of temporary structures used to divert river flows from residential areas; and (iv) repair and replacement of pumping equipment to evacuate flood rainwater from urban areas below flood water levels. (c) Housing: The reconstruction of homes destroyed or severely damaged through a program of grants and self-help work for about 5,820 low-income families who will rebuild their own housing units. The housing units were to be at least 30 m2, with two bedrooms and a multi- use room and to cost about US$3,700, excluding the labor to be provided by the beneficiaries. The beneficiaries were given the option to rebuild in the same location using stilted homes or to voluntarily relocate to areas of less risk with other local beneficiaries into an organized community, with each family having its land titled to the family itself. (d) Education and Health Facilities: The rehabilitation of education and health facilities and the construction of new buildings in locations well outside the 100 year floodplain, so as to prevent damage by future floods. (e) Water and Sewerage Services: The reconstruction or rehabilitation of water and sewerage infrastructure, including: water intakes; water treatment plants; water pumping stations; water distribution system for two cities; water wells sewage pumping stations; sewage interceptors and collectors for eight cities; and a sewage oxidation pond. (f) Additional Requirements: During appraisal, the brunt of the flood damage was not ascertainable, especially in the province of Buenos Aires, where the flood did not peak until July 1992. Therefore, the subprojects identified represented a limited inventory of the full extent of the damages. Proposals for possible subprojects were to have been identified and  5 evaluated by the SUPCEs before January 31, 1993 and sent to the Bank for review and approval. Each proposed sub-project would be justified and documented, as outlined in the Operational Manual. (g) Technical Assistance: Technical assistance was to be provided for the strengthening of institutions involved in project implementation, engineering design and feasibility studies, and construction supervision. (h) Flood Forecasting and Disaster Prevention: Authorities recognized the importance of ensuring adequate disaster prevention and mitigation measures and flood forecasting systems for effectively responding to future disasters. To attend to this demand the loan financed the examination of the quality of present mechanisms for monitoring, flood forecasting and "early warning" preparedness. Simultaneously occurred the purchase of equipment to improve the National Hydrological Institute (INCYTH) forecasting capability. Finally, a portion of the funds for this component were for the execution of the following studies: (i) regional issues concerning flooding in the Parana River basin, that also involve Paraguay, Brazil and Bolivia; (ii) mechanisms to prevent flood losses that discourage development (e.g., tax assessment practices); and (iii) insurance options as a way of spreading flood losses over a period of time and across larger groups than those directly impacted by any given flood. Executing Agencies 12. The Borrower was the Argentine Republic. In order to promptly implement the project, it was decided to use the already existing Provincial Development I Project's (Loan 3280-AR) organizational framework for that of the Flood Rehabilitation Project. Furthermore, the project built on the operational experience gathered through the implementation of the mentioned Provincial Development Project. 13. This existing framework consists of a Central Executing Unit (UEC) that is located within the Secretariat for Financial Assistance to the Provinces (SAFP) of the Borrower's Ministry of Interior. The UEC coordinated and oversaw the implementation of the Provincial Development I Project (and other internationally financed programs within the Ministry of the Interior) from a macro perspective, while the Provincial Executing Units (UEPs) implemented the activities at the local level. Similarly, the Flood Rehabilitation Project established (through the emergency amendment to Loan 3280-AR) a parallel system which consisted of the Sub- Unidad Central de Coordinaci6npara la Emergencia (SUCCE) at the central level that was linked to each participating province's Sub-Unidad Provincial de Coordinaci6n para la Emergencia (SUPCE). Even though in an organizational layout the SUCCE and SUPCEs are subordinates to their respective UEC and UEPs, SUCCE and each SUPCE were established to be fully autonomous entities. SUCCE has a chief executive assisted by a team of high level consultants in several infrastructure sectors of the operation. Each SUPCE was also headed by a chief executive and staffed with technically and administratively competent personnel. In addition, a highly experienced individual consultant played the role of the General Supervisor, with the responsibility for monitoring the project independently and reporting to the SAFP and the Bank. The designed layout was a critical element to the project as the idea was to have the  6 SUCCE and the SUPCEs as an agile unit with the objective to quickly coordinate the implementation of an emergency recovery flood project through focused technical expertise. 14. SUCCE's role in the project was to provide overall project management, including orientation and technical assistance to the provinces in the preparation, approval, control and monitoring project implementation, as well as for all financial and reporting transactions with the Bank. SUCCE was also responsible for sub-project evaluation, approval and procurement, as well as reporting and obtaining Bank approval of acquisitions and disbursements. 15. Each SUPCE was responsible for the formulation, implementation and supervision of provincial sub-projects. Furthermore, each SUPCE was responsible for procurement, contracting and submission of disbursements, all subject to the review by SUCCE. The agreed upon project operational manual provided the guidance and established the minimum standards for all aspects of implementation. C. Project Design and Preparation Conceptual Framework 16. The project was conceived in response to the Government's request for assistance in implementing its program to meet the financial demands of rehabilitating the various infrastructure sectors and supporting the plan to address the future demands of the sector in order to mitigate future economic and social disasters from being repeated. This concept was confirmed in the Bank's Aide Memoire dated June 16 to July 4, 1992, which summarizes the observations and conclusions in regards to the evaluation of the damage caused by the floods in the seven littoral provinces. In addition to identification, the mission also appraised the proposed rehabilitation project and identified the necessity of a follow-up project to address future flood protection measures. Project Preparation/Appraisal 17. Project preparation/appraisal was collapsed and took place in two stages during the June- July 1992 mission: (i) one with the Central Government; and (ii) the second with each of the seven participating provinces. This approach was in accordance with that of Argentina's federalism, that is dialogue was carried out directly with each of the afflicted provinces. In the first stage, the mission began its work in Buenos Aires with authorities from the Ministry of Interior and other federal authorities with the objective to understand and collect general information about the flood situation and to establish an overall strategy for the evaluation of the damage in the afflicted provinces and to program the sequential visits to those provinces. From June 19 to 26, the Bank mission visited the provinces of Corrientes, Formosa, Misiones, Entre Rios, Chaco and Santa Fe with the objective to identify and evaluate the various damages. Accordingly during this second stage, the Bank worked with the provincial officials whom were taking damage assessments while carrying out relief operations in the area. In each of the provinces, interviews were conducted with provincial governmental authorities and later the mission conducted site visits, accompanied by technical authorities from the sectors of highways, sanitation, health, education and housing. On June 29 the mission carried out its visit to the  7 Province of Buenos Aires, however, at this time the emergency had not fully affected the province and thus funds were set aside for the province in the unallocated category. 18. The mission's findings provided damage estimates across all infrastructure and social sectors. However, not all damages could be fully assessed nor evaluated due to the short timeframe of project preparation and that in many locations, flood waters were still at high elevations covering the proposed infrastructure to be rehabilitated (many of these unidentifiable works were in the water and sanitation sector). At project identification, approximately 75 percent of the works to be done were identified. A more comprehensive evaluation would have to be done by the implementation study at a later date. However, the mission assessed that all sub-projects or works would be short in duration (on average three months) and the project would be implemented in 30 months. As some works could not be truly assessed, actual works contracts on average were nine months, which was three times longer than expected. D. Project Implementation Project Start-up 19. Project start-up suffered some delays. The loan was signed on January 7, 1993 and became effective on March 23, 1993, six months after the Board's approval on September 29, 1992. This delay can be attributed to the numerous and lengthy bureaucratic steps required within the central government. Loan effectiveness required that at least three provinces had into effect their respective subsidiary loan agreements, the remaining provinces were effective by the end of April 1993, with the exception of the Province of Buenos Aires, which became effective on July 1, 1993. Project Implementation Schedule and Procurement 20. The project's Memorandum from the President and Technical Annex estimated that the project implementation would be from the last quarter of the 1992 calendar year to the end of the second quarter in 1994, with all disbursements made by the end of the third quarter. However, project implementation required an additional three years, due to: (i) sub-project review for technical adequacy and justification; (ii) the revision of existing detailed engineering plans; (iii) delays in provincial and federal counterpart funds payments; and (iv) longer than estimated construction times and construction and engineering complications, specially at the river divergence control structure in Laguna Blanca, Chaco. 21. The construction delays for two sub-projects (Laguna Blanca and Avenida Costanera) were the reason for the last 18 months of loan extensions. The main causes for these delays were in engineering design inadequacies discovered during construction and contractors with little experience in building major infrastructure works. In both cases, construction had to be slowed down or stopped in order to adjust engineering designs. In the case of the river divergence structure at Laguna Blanca in Chaco, major geotechnical work had to be done in order to stabilize the concrete structure. Since so many design alterations were done on this work, the Bank proposed that SUCCE hire a panel of internationally known engineers (strictural, hydraulic and geotechnical) to review the structure and propose operational and monitoring guidelines to  8 be used in the future. This structure is key in the defense of Resistencia against flooding from the Rio Negro, and in the unlikely event of its failure, the results could be highly catastrophic. 22. Other delays could be attributed to the lack of counterpart funds and the timely payment of contractors, which caused civil works to slow down or stop. Further delays with respect to the estimated timetable were realized during the implementation of the housing component, as 5,820 units were built in 100 different municipalities in six provinces. The housing component, although extremely successful, did require a lot of initial institutional development and time before reaching a satisfactory pace of implementation, as the activities were coordinated with several local agencies and ongoing national and provincial housing programs. 23. In regards to procurement, the entire process was transparent and flexible, due to the simplified bidding documents used and the limited Bank prior review of documents for the tendering of goods and works. Within two years of project implementation, SUCCE and the SUPCEs had developed a strong procurement capacity foundation. No major discrepancies or deviations were noted during bidding and/or contracting processes. Project Costs 24. Project cost was estimated to be US$270.0 million, excluding duties and taxes, which included civil works, materials, equipment, technical assistance and contingencies. However, the final project cost reached only US$258.8 million, excluding duties and taxes. As approximately 25 percent of the works were not identified during appraisal and 25.0 percent of the project's base cost was assigned to contingencies, Table 8A summarizes the breakdown of the final project costs by component, incorporating all contingencies and unallocated funds used. 25. The highest investments were made in flood defenses (33.9 percent), followed by transport and energy (27.6 percent), third was water and sewerage (10.5 percent), fourth was education (7.8 percent) and finally, health (3.1 percent). In summary, the unallocated funds and contingencies were used to address additional flood control and transport and energy rehabilitation works. 26. The savings realized during project implementation were attributed to two factors: (i) bid offers were below estimated values; and (ii) taxes and duties were estimated to be 18.0 percent of the project cost, in actuality this turned out to be 13.6 percent of the project cost. Project Financing 27. Estimated and actual sources of financing are shown in Table 8B. Of the total project cost, excluding duties and taxes, the federal government and the provincial governments each financed 13.8 percent, leaving the Bank's overall financing at 72.4 percert (7.7 percent from Loan 32-0-AR amd 6<.7 vnmercent from Loan 3521-AR). All these percentages of financing fall within the riSa i: l 7 estimated range of financing, which was -.e federal and provincial governments each financing 14.8 percent, the Loan 3280-AR amendment at 7.4 percent and Loan 3521-AR at 62.1 percent.  9 28. With respect to financing in each of the four categories, the Bank financed: (i) an additional US$4.6 million in works; (ii) US$10.9 million less in materials and equipment than estimated; (iii) US$5.2 million more in technical assistance and consulting services than expected; and (iv) US$1.8 million less in housing than expected. A summary of the informnation is shown in Table 8B. 29. As a result of the three-year delay in project implementation, disbursements did not follow the appraised estimates (see Table 4). These estimates appear to be unrealistic as disbursements followed in parallel an overly ambitious procurement schedule. Loan disbursements reached a satisfactory pace between the second half of the Bank's 1994 fiscal year (first half of 1994 calendar year) and the second half of the Bank's 1997 fiscal year. 30. Seventeen contracts covering emergency repairs in transport, energy, education, health and flood defense structures in five provinces valuing US$18.4 million dollars were retroactively financed. E. Project Results Changes in Project Objectives 31. The original project objectives and scope were maintained throughout project implementation. Physical Results 32. Despite the initial start-up delays and counterpart shortages during project implementation, all physical objectives were fully met and in some cases surpassed. The flood defense strategy used, along with the community participation methodology in the housing component, has effectively avoided damages, as demonstrated during early 1997 and the 1997/98 El Nifio. The achievement of the project's physical indicators has resulted in a lowered risk of economic disruption due to flooding and the investments made have also established a solid foundation for the launching of the Flood Protection Project. 33. As the flood waters lowered by the end of 1992 and early 1993, it became clear that more investments would be required in the rehabilitation of flood defense structures than originally estimated, as seen in the achievement of the different indicators in Table 5. Conversely, fewer investments were made in roads, while demands increased in the rehabilitation of ports and transmission lines. With respect to water and sewerage investments, two more water treatment plants and two more wastewater treatment plants were repaired than originally expected. Likewise increased the number of municipalities that required water distribution and sewage collector repairs. 34. Loan 3521-AR financed several studies, many for the preparation of the follow-up Flood Protection Project. Of all the studies, the most important to note is the river basin-wide assessment, the "Study of the Regulation of the Alluvial Valley of the Parana, Paraguay and Uruguay Rivers for Flood Protection". This study, the foundation to the follow-up project, was  10 carried out by the international consulting firm, Sir William Halcrow & Partners, Ltd. of England, from April to September 1994. 35. In addition to the tangible physical results, the project generated many indirect and social benefits that can be difficult to quantitatively evaluate. The promotion of community awareness by the SUPCEs and other local authorities during implementation has resulted in some of the following additional benefits: * Cleaner communities and less uncontrolled solid waste dumping in drainage canals. * Stronger sense of community identity in newly formed housing commurnities, along with community empowerment to request additional services. * Individual ownership identity of homes built through the self-construction methodology. * Improved sanitary and health conditions, including the restoration of medical facilities. * Public awareness for the maintenance and respect for defense structures, especially pumping stations, drainage canals and levees. Financial Performance 36. The financial performance analysis included a comparison of the costs associated with executing agencies versus the amount invested and the counterpart funding compliance by the provincial and the federal governments. (a) SUCCE. SUCCE's operational and consultancy costs during the implementation of Loan 3521-AR and the first emergency amendment to Loan 3280-AR equaled about US$56.4 million, of which the Bank financed US$5.2 million. Said SUCCE expenses were comprised of the following: consulting fees for approximately 20 staff over five years, covering, e.g., their services, trips and per diems and personal medical insurance (88.2 percent); computers and other office equipment (3.5 percent); and office supplies and other related overhead costs (8.3 percent). Auditing expenses, which were not included as part of SUCCE's direct costs, equaled US$1.7 million over five years. In regards to the audit reports themselves, they were done every six months because of the flexible procurement thresholds. All audit reports were submitted with unqualified opinions. In addition, a financial management system (FMS) review was conducted in March 1998 to further improve the financial management capacity of SUCCE in the implementation of other Bank loans. (b) SUPCEs. The costs associated to operate all of the seven SUPCEs were US$13.4 million, excluding the staff salaries. Staff salaries were not included because many staff were transferred from existing line agencies and their salaries would have been paid, regardless of the creation of a SUPCE. The operating costs encompasses: travel and perdiems (7.3 percent); office overhead, services and others (9.4 percent); insurance (0.3 percent); and technical assistance (83.0 percent). The only expenses that were financed through the loan were those related to technical assistance, which was US$8.3 million of the US$1 1.1 million. An analysis of each SUPCE's cost as a percentage of its respective province's project cost resulted in fairly consistent values, with the exception of Buenos Aires, which SUPCE's cost represented 39.2 of the province's investments. On average, each SUPCE cost 6.0 percent of  11 its respective province's investments and excluding Buenos Aires from the statistic, the average falls to 4.7 percent. SUPCE-Buenos Aires' high costs are due to the heavy amount of technical assistance required. Overall, however, the SUPCE costs associated with the implementation of the activities in each province falls within an acceptable range. Likewise, the March 1998 financial management system review included the SUPCEs. (c) Counterpart Funds. Fiscal constraints of the mid 1990's, attributed to the "Tequila Effect", had repercussions on the transferring of national counterpart funds to the provinces and likewise the availability of provincial counterpart funds. These delays in payments played a roll in prolonging the Flood Rehabilitation Project. The delays started in 1995 when the National Budget Office did not incorporate sufficient resources within its 1995 budget exercise for federal counterpart funding. Sufficient resources were not allocated until the 1997 budget exercise and the federal government did not finish transferring overdue counterpart funds to the provinces until April 1997, in accordance with a Bank proposed timetable. The availability of provincial counterpart funds began to diminish in 1996, most notably in the provinces of Formosa and Misiones, two of the most financially constrained participating provinces in the program. In fact, as of May 20, 1998, Misiones and Formosa still owe AR$247,483 and AR$2,493,932 in counterpart funds, respectively. These two provinces are attempting to reduce their overdue payments to contractors by offering bonds. The delay in counterpart fund payments has been duly noted by the auditors as a violation of the Loan Agreement. It is the intention of the Bank to have these two provinces fulfill their obligations prior to beginning the bidding of their sub-projects in the Flood Protection Project, in order not to deter contractors from bidding in future works. Economic Evaluation 37. Because this was an emergency recovery loan, no financial or economic cost and benefit analysis was carried out at appraisal. However, based on the availability of information in flood- related avoided damage prepared by SUCCE and independent consultants, it was decided to calculate the economic rate of return (see Table 9) for eight selected cities along the Parana. For the eight cities in question, the analysis yielded an internal economic rate of return (IERR) of 35.1 percent; this high rate of return is essentially attributed to the immediate benefits realized from the 1997 flood, in which the avoided damage for the cities was estimated at US$234.4 million (1995 US$). The project's IERR will actually end up being even higher because of the avoided damage benefits that were realized from the 1997/98 El Nifno phenomena in early 1998. The methodology for the analysis was as follows: (a) Costs. The eight identified cities represent US$152.8 million in investments, or 59.1 percent of the project's total cost (excluding duties and taxes). The only other cost considered was for maintenance, which was assigned an annual rate of 2.2 percent of the investment costs (US$93.8 million) of the structural measures, except for a 3.0 percent maintenance cost every five years. Financing charges during construction were not considered. (b) Benefits. The benefit stream (1993 dollars) includes the estimated cost of the direct flood- caused damage avoided in each city for actual occurrences from 1993 to 1997, while from 1998 to 2012 was based on the probability of expected avoided annual damage. The expected benefits were estimated on the avoided damage for all floods with a recurrence time  12 lower (or probability of occurrence higher) than the rehabilitated defense level established for each city. This dollar value is calculated by the mathematical integral of a damage cost function over the probability of occurrence distributed over the life of the project. The average avoided damages per city were then distributed on a per capita basis for that city. Thus, as the population grows and the protected urban area density increases, so too does the avoided damage increase. Population growth for all locations was taken at 1.0 percent' per annum, which corresponds to a 1.0 percent annual growth rate in the avoided darnage. These avoided costs refer only to the estimated rehabilitation expenses of existing facilities and infrastructure, such as roads, bridges, water intakes, houses, and public buildings, the government would incur in the case of a future recurrent flood. No direct economic or social costs associated with floods were considered, thus resulting in a lower bound of the benefits associated with the project. Nornally for flood investment projects the principal benefit, "avoided damage", refers to the difference between damage costs under conditions "with" and "without" the investments. However, in the Flood Rehabilitation Project, since many defenses were incomplete or washed out from the 1992 flood, the post-flood defense system was considered to be non-functional, as a defense structure is only as strong as its weakest point. Thus, capital investments in the rehabilitation project resulted in a high level of benefits. (c) Present Values. Net present values (NPV) of costs and benefits were calculated over a 20- year estimated lifetime (1993-2012) of the investments (common for earthwork structures), assuming a 12 percent discount rate, and assuming that benefits did not begin until 1996, at which point 85 percent of the investments had been made. The NPV at the mentioned discount rate was estimated at US$642 million. All values were calculated in 1993 dollars. (d) Sensitivity Analysis. The sensitivity analysis, as seen in Table 9, shows that the project in the long-term is not sensitive to an increase in maintenance costs. However, the project is quite sensitive to a lower than statistically expected average annual avoided damages, that is reductions of 50 and 75 percent in the yearly benefits from 1998 to 2012 would lead to returns of around 27.9 and 22.6 percent, respectively. Furtherrnore, if the 1997 flood had not occurred and just the expected yearly average damages were avoided, the return would have been reduced to 20.5 percent (an economic rate of return similar to the new Flood Protection Project). Impact on Poor 38. The project's housing program was designed to provide assistance to the poor that were affected by the flood or living in a vulnerable location within a floodplain. The program was highly successful in achieving its objective, as 5,820 poor farnilies affected by the flood were assisted in about 100 different locations. The benefiting population represents 28.4 percent of the inhabitants evacuated during the 1992 flood. The beneficiaries were given the option to rebuild in the same location using prefabricated stilted homes or to voluntarily relocate to a nearby area of less risk with other beneficiaries into an organized community. The use of traditional style of brick construction was very successful with the beneficiaries and also establishes ownership and sustainability. Conversely, experience has raised doubts in the use of l1997 World Bank Development Indicators reports Argentina's expected growth rate from 1995 to 2010.  13 wood panels and prefabricated prototypes, which reduces the beneficiaries' participation and sense of ownership. Each family had its land titled and furthermore, since the newly constructed homes were clustered into organized communities, local municipalities, through federal and provincial programs, were able to cost effectively provide basic infrastructure services such as water, sewerage and electricity to families that previously had no such services. The average participating family's profile in the housing program was as follows: (a) Monthly family income': $156 (b) Education: Primary incomplete (c) Household head age: 32 (d) Number of families: 5,820 (e) Number of people per family: 5 (f) Basic Services: Water 40% Sewage 10% Electricity 58% (g) Percentage of construction 36% Female participation by sex: 64% Male F. Project Sustainability 39. On the whole, the achievement of the project's objectives should be sustainable for the following principal reasons: Institutional/Management Effectiveness 40. The establishment of the SUCCE and SUPCEs and their framework has been highly beneficial for the coordination and strengthening of activities between the federal and local governments, but also coordination amongst the provincial agencies. In addition, these implementation entities are a representative voice for necessary budget requirements, such as operation and maintenance of defense structures. In regards to emergency management, the Government should consider establishing a permanent directorate for emergency management within the Ministry of the Interior in order to achieve long-term sustainability. Housing Program 41. A post implementation risk identified was that families would sell their newly constructed homes and return to the high risk areas once occupied or that new inhabitants would occupy the land in question. However, the former concern has not appeared to materialize to date. The new sanitary and health conditions, along with the provision of social programs, demonstrates to the beneficiaries the advantage in living in the new conditions over the former precarious situation. Sustainability of the new homes and their original beneficiaries is highly likely. In regards to the concern of new inhabitants taking over previously occupied land, this risk will be addressed in 1 Government of Argentina classifies families as poor with monthly household income levels below US$360.  14 the Flood Protection Project, which requires that provinces and municipalities pass a standard flood protection law that incorporates land zoning and land use regulations. Public Awareness/Commitment 42. The 1990's have witnessed an alarming increase in the numnber of severe floods, especially the latest, which was linked to the 1997/98 El Niflo phenomenon. During the past five years, affected citizens have directly benefited from the flood protection defenses and the associated economic and life saving potential several times. With such a strong visual and mental experience associated with the protection works, the support from the local population, the media, and the politicians has come wholeheartedly. Sustainable commitment has been further demonstrated by the eagerness of local populations to have the works that are being financed by the follow-up Flood Protection Project to start immediately in their municipalities. Technical and Economic 43. The investments in civil works were aimed at rehabilitating existing infrastructure through a quick and locally competitive tendering process that assured a cost-effective solution. The follow-up project aims to increase the level of protection to its optimal level, considering the socio-economic factors involved. Technical sustainability and realization of the investment's economic return should be guaranteed through appropriate operation and maintenance that is carried out when there is strong public and political support. Flood Protection Project 44. The activities that are being carried out under the follow-up Flood Protection Project will enhance sustainability. The new local laws and river-basin-wide coordinating arrangements should help strengthen the local governrnents' flood preparedness and mitigation systems. Furthermore, the new project will ensure that the well-trained and competent staff of SUCCE and the SUPCEs continue to provide the strong technical and institutional support required for sustaining project investments. G. Bank Performance 45. Bank performance during identification, preparation and appraisal was satisfactory. The Bank's performance was highly satisfactory in terms of responsiveness to the clients needs, since the operation was prepared relatively quickly, three and half months from the start of the first mission to Board approval. Project design was well developed and conditions essential to the sustainability of the project were identified, resulting in the inclusion of a number of studies, plans and programs. In particular, the Bank did well in maintaining the housing program in the loan, even though at one point it contemplated removing this component due to the Bank's lack of experience in such housing programs and concern about corruption. The only deficiency in project preparation was the oversight of properly screening available engineering designs for environmental and technological appropriateness, especially in regards to the works at Laguna Blanca, Chaco. The construction delays caused by the necessity to re-evaluate the designs delayed project completion and in hindsight it would have been more advantageous to take the  15 initial time to closely screen the engineering plans and design the project with a longer implementation period. 46. Bank performance with respect to supervision was satisfactory. Due to a sound and flexible project framework, the Bank's role was more in maintaining the project's momentum by dealing foreseen and unforeseen obstacles in a timely fashion throughout implementation. Supervision was excellent in terms of: (i) its intensity and level of commitment from high quality Task Managers (TM) and staff; (ii) continuity in management, only two TM during supervision cycle; (iii) advice to implementing agencies; (iv) organizing floodplain management workshops/study tours in other countries; (v) 26 supervision missions (see Table 12) that amounted to 242 days in the field over five years and visits to all the participating provinces, including frequent construction site visits; and (vi) the establishment of a sound and trusting relationship with the borrower, especially with the implementation units. Although all audit reports had unqualified opinions, the Bank's supervision could have been improved in the area of financial management, specifically in terms of direct linkage between physical advancements and disbursements. H. Borrower Performance 47. Because of the project's implementation framework, it is necessary to divide this section into the performance of the Argentine Republic (the borrower), SUCCE, the SUPCEs as a whole and the UEC. The Argentine Republic 48. The borrower's role in this project was limited; however, the few responsibilities it had were essential to the project's implementation. During project preparation, the borrower's Ministry of Interior performed very satisfactorily, rapidly organizing the logistics for the carrying out of the assessment of the damaged areas in conjunction with the Bank's mission. The borrower's response into signing the Loan Agreement and putting the loan effective were lengthy considering the importance of the project. As stated earlier, it only took the Bank three and half months to prepare the project and obtain Board approval on September 29, 1992. However, loan signing did not occur until January 7, 1993 and the loan was not effective until March 24, 1993. These delays are mainly attributed to the excessive bureaucratic steps within the Ministries of Economy and the Interior. The borrower needs to develop a streamline approach when dealing with emergency recovery loans, so as not to prolong the recovery of the afflicted area. In regards to its counterpart funding obligations, the borrower eventually performed satisfactorily, as all past due transfers have been made. SUCCE Performance 49. SUCCE, a subordinate to the UEC, was nevertheless designed as a technically and administratively autonomous unit. SUCCE carried out its responsibilities highly satisfactorily. SUCCE's use of highly skilled consultants and the organizational framework were key in maintaining credibility in the program, for both the Bank and more importantly for the provinces. SUCCE established and maintained constant communication with the provinces, especially in  16 providing the necessary technical guidance in locations with problematic or complex construction. Above its fiduciary role, to facilitate communication and the transferring of knowledge and gained experience (best practice) among the SUPCEs, SUCCE used a periodic circular noting criteria and procedures, especially those relevant to procurement. This pamphlet proved beneficial in the initial months of project setup and organization and in the latter stages regarding contracting and technical issues. SUCCE was also essential in the preparation of the Flood Protection Project and the recent El Nifio Emergency Flood Project. Likewise, the project's General Supervisor played invaluable role in project reporting and providing solutions to technical problems. 50. In regards to monitoring and reporting project activities to the Bank, SUCCE timely submitted all required information. Project auditing was done every six months, given the amount of flexibility to implement the project, and all audit reports had unqualified opinions. SUPCEs Performance 51. Not all SUPCEs performed the same, but under the guidance of SUCCE, the SUPCEs gained experience from individual lessons learned and from the experiences of each other that were shared through established chains of communications. The SUPCEs began strongly, considering that they were newly created and without experience in Bank operations. This was achieved due to the staffs' demonstrated strong commitmnent in learning the required administrative procedures. On the whole the SUPCEs carried out their duties fully satisfactorily by way of speedily dealing with the emergency recovery and coordination, and in the supervision and management of the conventional investments and their respective contracts. The sustainability of the project actions appears to be ensured by the competent staff in the SUPCEs and the communications that were maintained with municipal and provincial authorities. UEC Performance 52. Although the UEC was not the executing unit in this project, as is the case with other Bank operations within the Ministry of Interior, as SUCCE's superior, any UEC changes directly impact SUCCE. As was the case in the latter years of the project, when the UEC had grown into a relatively bureaucratic unit as its responsibilities grew. At the same time, the Presidency requested all project units in the beginning of 1997 to consolidate in order to reduce duplication and operational costs. Thus, the UEC centralized its staff into the different functions. In carrying out this centralization, the UEC has had to override SUCCE's autonomy (as established in the Loan Agreement) by centralizing key administrative SUCCE staff and functions, particularly in terms of legal, disbursement, procurement and accounting. This centralization created an administrative layer for SUCCE which reduces its responsiveness, and appears to add very little value. In response to numerous provincial complaints, the Bank has requested that the UEC adhere to standards when reviewing documents. Unfortunately, however, this appears not to be working as delays continue. This is of particular concern to the Bank's supervision of the Flood Protection Project and as well as other projects managed by the UEC (El Nifio Emergency Flood, Provincial Development II, etc.).  17 I. Assessment of Outcome 53. The project on a whole is rated fully satisfactory. Even though the project was completed with delay (due to financial constraints and partly due to an optimistic implementation plan), all objectives were achieved. Although no performance indicators were established, benefits are evident from project areas that have been protected from the recent floods, including the 1997/98 El Nifio. In regards to the benefits realized from the 1997/98 El Niio, all but one participating municipality's structural defense withstood the event, and that was due to poor operation and maintenance. The most notable was in the City of Resistencia (pop. 310,000) where its levee came within less than 30 cm of overflowing during the latest flood. J. Project Sustainability 54. Project sustainability is fairly certain as there is a government and public awareness for the need for complementary actions that have been defined in the follow-up Flood Protection Project. Not all actions could be addressed as floodplain management requires numerous investments. In short, if this project had not been implemented and coupled with the increase in flood frequencies since project implementation, the economic-infrastructure damages in conjunction with the social and economic losses may have been catastrophic to the point of paralyzing the region's economy and possibly resulting in minimizing Argentina's recent gains from MERCOSUR. K. Future Operations 55. The Bank's assistance program, as outlined below, should help to secure the objectives and sustainability of this project (Loan 3521-AR). Flood Protection Project (Loan 411 7-AR) 56. The Flood Protection Project is the follow-up loan that will further develop a sustainable level of protection in parts of Parand basin. Most of these works are focused on the cities bordering the Parand River, where the population and economic activity are concentrated. In addition to the physical activities, this project invests in the non-structural measures of improving civil defense coordination, establishing land use regulation laws, developing an early waming system and many other institutional and environmental strengthening programs. The project is expected to cost US$420.0 million, of which US$200.0 million is being financed by the Bank and US$120.0 million by the Export-Import Bank of Japan (JEXIM). Affter months of bureaucratic delays within the Ministries of Interior and Economy, the Bank's loan became effective in October 1997 and JEXIM's loan in January 1998. El Nino Emergency Flood Project (Loan 4273-AR) 57. The 1997/98 El Nifio has been measured as the second strongest event after the 1982/83 phenomena. The resulting substantial rains flooded the Uruguay River, where many investments had not been previously made because historically it has never been a problem. The US$35.0  18 million in activities to be financed in the Parand basin go above and beyond those that were and are to be addressed in Loan 3521-AR and Loan 4117-AR, respectively. In addition, US$25.0 million is expected to be invested in other (mostly northwestern) provinces of Argentina to prepare for the possible impact of the 1998 La Nifia. Of the US$25.0 million, US$1.0 million will be used to conduct a regional risk study. The Bank prepared and received Board approval for the loan on January 20, 1998, two months after receiving the Government of Argentina's fonnal request for assistance. The loan became effective on October 6, 1998. Water Resources Management Sector Work 58. The Bank's recent efforts have focused entirely within the Parana Basin and has only recently, on a modest scale, moved into addressing the issues of semi-arid regions of the Northwest. Although much work still lies ahead within the Parand Basin, the sector work to be done by the Bank during 1999 Fiscal Year will encompass water resource management issues, including, floodplain management framework, water rights, pollution control, water basin agencies, necessary flood protection laws and many other topics, especially in the semi-arid regions. The intention is that the results from this study will help to determine the necessary institutional and legal requirements for the integrated management of Argentina's water resources well into the future. Urban Drainage Project 59. The Bank and the borrower have initiated discussions regarding a future project involving the designing and construction of macro and micro drainage systems for major urban areas in Argentina to compliment the flood protection effort. In addition, this project may include a solid waste management component among others. The Flood Protection Project is financing the study and development of the drainage engineering plans for the city of Buenos Aires. Currently this proposed project is in the Bank's pipeline. L. Key Lessons Learned Emergency Project Design 60. One of the key lessons, already applied to other Argentine flood rehabilitation and protection projects, is that physical rehabilitation alone is not sufficient to sustain long-term benefits, as well as provide an effective level of protection. Even in emergency projects, funding should be allocated for the development of non-structural measures that establish the capacity to manage future emergencies at provincial and local levels. 61. Although the project took an additional three years to complete beyond its original two- year design, its implementation still has to be considered an achievement given the multi-sector scope of the project. By end 1995, 90 percent of physical works were completed, but more time was required because of a few complex works and budget constraints in 1995/96. The successes achieved can be replicated and further improved by considering the following principles: (i) using simple and easy investments to implement with adequate design standards; (ii) using a flexible project design that is not over-specified; (iii) ensuring participation of interested  19 provinces with adequate counterpart financing from the tax revenue sharing system; (iv) maintaining competent local executing units with the capacity to deal with emergencies; (v) enabling flexibility to shift funds among eligible provinces, including a portion of funds as unallocated for unforeseen activities; and (vi) preparing a well formulated but simple project operation's manual. Consideration should be given to realistic completion schedules when preparing emergency loans, especially ones as complex as this one. Policy Lessons 62. The institutional set-up of the SUCCE-SUPCE framework was crucial to the project's implementation and its sustainability in maintaining an effective method of communication and coordination among the provincial and federal governments. Project activities progressed well because of decentralized decision making by provincial implementing units, with relatively light handed central Government control, and the fact that the provincial implementing units also remained small and focused on establishing effective collaboration with established line agencies. 63. Emergency operations that involve voluntary resettlement through a housing component should assist in the definition of land use regulations that forbid new inhabitants from resettling the land that is at risk. Otherwise such legal and institutional aspects should be addressed in a follow-up project to prevent such human occupation and settlement of land in high-risk areas (in this case, the follow-up Flood Protection Project). 64. Emergency recovery assistance in most developing countries should be viewed as only a first step to restore economic and financial activities. The Bank's assistance should continue in a follow-up operation that provides assistance to implement medium to long-term risk mitigation and prevention goals established during the emergency operation. 65. Restricting development in floodplains and preserving the ecosystem are better achieved and supported through the use of fiscal incentives, effective land use and management practices, and sound governmental policies and programs aimed at avoiding further environmental degradation. These approaches to risk prevention and mitigation are less costly and more effective than physical measures, as recited in the Bank's policy paper on Water Resources Management (April 30, 1993) and incorporated in the design of the follow-up Flood Protection Project. Implementation Lessons. 66. In view of the emergency and because the repair and reconstruction works were relatively small in size and executed in scattered locations in seven provinces, procurement procedures for eligible subprojects were simplified in line with Bank guidelines to facilitate speedy implementation. As nearly 99 percent of the works was awarded through national competitive bidding (NCB), quotation, or direct contracting, the Bank's prior review was limited to the first two NCB contracts per year with the remaining review conducted on a spot-check basis in the field. In order to provide assurance that the Bank's procurement procedures and funds were being properly used, project audits took place semi-annually instead of annually.  20 67. Delays occurred with respect to the implementation schedule because SUCCE's analysis of the proposed sub-projects for their technological and environmental appropriateness and adequacy was not considered. An adequate time allowance should be made for such reviews in all emergency operations, as sub-project evaluation is not based on an ex-ante project evaluation process. 68. Experience has shown that multi-sector projects tend to be difficult to implement and complete on time. However, in this project delays were attributed to engineering and construction problems and counterpart funding shortages. The multi-sector nature of the project had no significant influence on implementation delays. 69. The use of a structured implementation framework with a very capable project executing unit staffed by a team of experienced consultants in several infrastructure sectors of the operation was a key factor in the successful implementation of this emergency operation. The staff should be recruited competitively and paid according to market standards to guarantee a high level of quality and to minimize staff turnover. 70. Emergency operations require a strong commitment not only from the Borrower, but also from the Bank in terms of supervision. This project benefited from several supervision missions that included extensive field visits and on-site inspections. Emergency loans need to be designed with a flexible implementation framework and visible Bank presence in order to assist in adapting the project to meet unforeseen demands and to successfully manage and remove implementation bottlenecks. Community Participation 71. The participation of beneficiaries and affected parties in planning, designing, implementing and managing the project is essential to ensure a satisfactory outcome of an emergency project. This was especially relevant in the housing and shelter component. The interaction in local communities between beneficiaries and the local authorities resulted in the timely availability of construction materials and the incorporation of local customs in the architectural design of the new houses. The housing program was also essential in attending to the poor (beneficiaries with an average household income of US$156) and encompassing the participation of women, who input 36 percent of the total labor. Project Financing 72. In order for an emergency loan to be implemented quickly, overall Bank financing of an emergency operation should be a minimum of 60 to 70 percent. This minimizes the amount of counterpart funding requirements and unforeseen fiscal adjustments required by the federal and local government and allows what little government resources that remain to be used in other areas of relief that are not covered by the Bank's project.  21 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 1: Summary of Assessments A. Achievement of Objectives Substantial Partial Negligible Not applicable Macroeconomic policies / Sector policies / Financial objectives / Institutional development / Physical objectives / Poverty reduction' Gender issues' / Other social objectives' | Environmental objectives / Public sector management / Private sector development Likely Unlikely Uncertain B. Project Sustainability / Highly C. Bank Perfonnance Satisfactory Satisfactory Deficient Identification 1 Preparation assistance 4' Appraisal2 4 Supervision / Highly D. Borrower Performance3 Satisfactory Satisfactory Deficient Preparation 4 Implementation: Provision of counterpart fumds4 4 Project coordination 4' Covenant compliance / Operation (if applicable) 4 Highly Highly Satisfactory Satisfactory Unsatisfactory Unsatisfactory E. Assessment of Outcome V' I Voluntary resettlement of 5,820 affected low-income families. With respect to gender concerns, the project provided substantial female participation (more than one third) in the self-help housing construction program. 2Under estimated capability of timely counterpart funding contributions by both central and provincial governments. 3Performance considers the participating provinces (Buenos Aires, Corrientes, Chaco, Entre Rios, Formosa, Misiones, and Santa Fe). 4Lag in central government's contribution due to financial situation and several provinces' lack of counterpart funding delayed payment to contractors.  22 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 2: Related Bank Loans/Credits Loan/Credit and Title Purpose Amount Year Status (US$ Million) Preceeding Operations None Concurrent Operations Provincial Development I Uncommitted funds used to 20.0 1992 Executed Project (1st Emergency address the immediate needs of Amendment to Loan strengthening the project's 3280-AR) existing institutional framework and physical rehabilitation. Following Operations Japanese Grant Provided financing for technical 0.6 1994 Executed (TF 22274-AR) assistance for the preparation of the Flood Protection Project. Provincial Development I Remaining uncommitted funds 14.0 1997 Under Project (2nd Emergency used to finance the immediate Execution Amendment to Loan rehabilitation and protection 3280-AR) activities related to the 1997/98 El Niflo. Flood Protection Project Provide higher degree of flood 200.0 1997 Effective (Loan 4117-AR) protection in selected economically important locations along the Parana River. El Nifno Emergency Provide assistance to address 42.0 1998 Board Flood Project (Loan the ongoing flooding Approved 4273-AR) emergency in the Parana Basin above and beyond those identified from the previous loans and to investment in flood protection infrastructure in the northwestern provinces.  23 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 3: Project Timetable Project Cycle Steps Date Planned Date Actual/Latest Estimate Identification (Initial Executive Project Summary) June 15-July 4, 1992 June 16-July 4, 1992 Preparation' June 15-July 4, 1992 June 16-July 4, 1992 Appraisal' June 15-July 4, 1992 June 16-July 4, 1992 Negotiations' August 24-26, 1992 August 24-26, 1992 Board Presentation not available September 29, 1992 Signing not available January 7, 1993 Effectiveness' October 30, 1992 March 24, 1993 Midterm Review2 October 1993 not available Project Completion September 31, 1994 November 30, 1997 Loan Closing3 March 31, 1995 March 31, 1998 iAs per the Memorandum of the President. 2 As per the Technical Annex text. 3 Loan Closing Date extended four times from March 31, 1995 as follows: to March 31, 1996 under amendment of November 9, 1994 to December 31, 1996 under amendment of November 13, 1995 to September 30, 1997 under amendment of December 19, 1996 to March 31, 1998 under amendment of September 26, 1997  24 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 4: Loan Disbursements': Cumulative Estimated vs. Actual (US$ thousands) Bank FY Half Estimate f Actual Actual as % of Date of Final l ___________ _______ ___ _I ____II Estimate Disbursement 1993 1 22,000 - 1993 2 68,000 5,871 8.6 1994 1 112,000 15,663 14.0 1994 2 153,000 48,303 31.6 1995 1 170,000 89,943 52.9 1995 2 - 118,937 70.0 1996 1 - 143,090 84.2 1996 2 - 152,220 89.5 1997 1 - 158,611 93.3 1997 2 163,811 96.4 1998 1 166,821 98.1 1998 2 - 167,202 98.4 July 22, 19983 Cummulative Loan Disbursement 200 150 -.-- Actual ~50 0 C) a) m CDD CD O Bank Fiscal Year IDisbursement total includes original (35210-AR) and all converted loans (3521A-AR and 352 IS-AR) 2 Estimates according to September 4, 1992 MOP/Technical Annex 3 Final disbursement for converted Loan 352 1A-AR  25 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 5: Key Indicators for Project Implementation Key Implementation Indicators Estimated Actual I. Indicators in MOP/Technical Annex and Loan Agreement A. Transport and Energy Urban Roads 21 (locations) Unknown Ports (quantity) 6 10 Bridges (quantity) 29 22 Highways (km) 3,408 1,707 Railroads (kn) 3 5 Transmission Lines (km) 4 35 B. Flood Control Works Levees (km) 50 228 Protected Area (hectares) 1,407 Unknown Soil Movement (1000 m3) 6,030 9,150 Pumps (quantity) 14 175 C. Housing (units) 6,201 5,820 D. Education Facilities (quantity) 262 217 Primary Schools (quantity) 234 191 Secondary Schools (qty) 8 9 Others (quantity) 20 17 E. Health Facilities (units) 38 38 Auxiliary Centers (units) 4 0 Health Centers (units) 8 15 Hospitals (units) 10 11 Health Posts (units) 4 2 Community Centers (units) 11 9 Others (units) 1 1 F. Water and Sewerage Works Stormwater Drainage (km) 39 25 Water Treatment Plants (qty) 1 3 Sewage Treatment Plants (qty) 2 4 Water Distribution (locations) 2 5 Sewage Collectors (locations) 8 13 Water Intakes (quantity) 9 9 II. Modified Indicators Not Applicable IIL Other Indicators A. Institutional Development I SUCCE I SUCCE 7 SUPCEs 7 SUPCEs B. Flood Forecasting System 7 Connections with each Province 7 Connections C. Contracts Not Applicable 434 Works Contracts (quantity) Not Applicable 298 Goods Contracts (quantity) Not Applicable 56 Consultant Contracts (qty) Not Applicable 80  26 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 6: Key Indicators for Project Operation Key Implementation Indicators Estimated I Actual I. Indicators in MOP/Technical Annex None None II. Modified Indicators l None Nonel mII. Other Indicators None None  27 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 7: Studies Included in Project Study Purpose Impact of Study Consultant Contract Contract in Charge Date Value (AR$ '000) 1) Study of the Regional flood Permitted the start of the Sir William March 650.3 Regulation of the protection study evaluation of the Flood Halcrow & 1994 Alluvial Valley of addressing Protection Project and Partners the Parana, Paraguay physical, legal, developed the provincial and Uruguay Rivers institutional and master plans and a base for for Flood Protection socio-economic the development of local issues. master plans. 2) Gualeguay Master Master plan for Permitted the detailing and Engineer January 189.0 Plan city's flood area. budgeting for each of the Jorge 1995 city's works to be in the Karnesonyi Flood Protection Project. 3) Corrientes Master Same as above. Same as above. Engineer January 193.6 Plan Juan Carlos 1995 Fassi 4) Goya Master Plan Same as above. Same as above. Engineer January 192.0 Oscar 1995 Bonfanti 5) Formosa Master Same as above. Same as above. Engineer January 229.1 Plan Juan Jose 1995 Ronco 6) Clorinda Master Same as above. Same as above. Engineer January 198.6 Plan Reinaldo 1995 Agustoni 7) Resistencia Same as above. Same as above. Engineer January 229.7 Master Plan Sanchez 1995 Guzman 8) Diamante Slope Erosion/sedimenta Permitted the engineering Dr. Jose A. February 110.0 Stabilization tion study due to details to be finalized for the Sanguinetti 1995 floods. river's bank stabilization and expected cost. 9) Linea Tapenga Master plan for Permitted the detailing and Engineer March 96.0 Master Plan city's flood area. budgeting for each of the Carlos A. 1995 city's works to be in the Depotris Flood Protection Project. 10) Mercedes Environmental Used for the prioritization of Engineer April 30.0 Economic and and econimic works to be included in the Mario 1995 Environmental impact assessment Flood Protection Project. Alegre Impact of protection measures.  28 11) Bella Vista Master plan for Permitted the detailing and Engineer Appril 80.0 Master Plan city's flood area. budgeting for each of the Horacio 1995 city's works to be in the Gallardo Flood Protection Project. 12) Curuzui-Cuatia Same as above. Same as above. Engineer March 88.0 Nello D' 1995 Ascenzo 13) Esquina Master Same as above. Same as above. Engineer E. March 100.0 Plan Mutta 1995 Quiroga 14) Gualaguay Additional work Provided further soil studies Engineer September 38.0 Geomorphology for city's master when decided to increase Mario 1995 Study for Traza plan. protected area due to the Lasanta Island request of the community. 15) Zarate and Hydrologic/hydra Permitted the detailing and Engineer July 1995 80.0 Campana ulic protection budgeting for flood Jorge Hydrologic plan for city's protection works to be Arancibia Protection Plan flood area. executed in the Flood Protection Project for each city. 16) San Pedro, Same as above. Same as above. Engineer April 120.0 Baradero, San Juan 1995 Fernando, Tigre and Sallaber Escobar Hydrologic Protection Plan 17) Islas del Delta Same as above. Same as above. Engineer April 100.0 Hydrologic Pablo 1995 Protection Plan Bronstein 18) Formosa Hydrologic/hydra Permitted the detailing and Engineer November 195.0 Internal Basin ulic protection budgeting for flood Mario 1995 Hydrologic plan for city's protection works to be Ferdkin Protection Plan flood area. executed in the Flood Protection Project for each city. 19) Parand Economic and Used to prioritze the works to Engineer April 50.0 Economic and envirommental be financed unde the Flood Luis 1995 Environmental impact evaluation. Protection Project and their Pucinelli Impact respective environmental impact. 20) Ibicuy Same as above. Same as above. Tomas April 20.0 Economic and Gutirerrez 1995 Environmental Impact 21) Villa Parancito Same as above. Same as above. Engineer April 20,000 Economic and Hector 1995 Environmental Santarelli Impact 22) La Paz and Same as above. Same as above. Lilian Boiry April 48.0 Santa Elena 1995 Economic and Environmental Impact  29 23) Victoria Same as above. Same as above. Professor April 10.0 Economic and Maria 1995 Environmental Galloni Impact 24) Concepci6n del Same as above. Same as above. Engineer L. April 48.0 Uruguay Economic Gonzalez 1995 and Environemtnal Videla Impact 25) Gualeguaychui Same as above. Same as above. Engineer April 30.0 Economic and Osvaldo 1995 Environmental Postiglioni Impact 26) Col6n Economic Same as above. Same as above. Enigneer April 20.0 and Environemtnal Amalia 1995 Impact Russo 27) Concordia Same as above. Same as above. Engineer April 30.0 Economic and Juan Carlos 1995 Environmental Giani Impact 28) Federaci6n Same as above. Same as above. Engineer April 20.0 Economic and Emilio 1995 Environmental Bertero Impact 29) Santa Fe Intemal Enviromnental Impact of three flood Architect April 12.0 Basins impact. protection works to be done Nora 1995 Environmental in the Flood Protection Clichevsky Impact Project. 30) Resistencia Evaluation of To better detail the damages Nordeste February 5.4 Damage Assessment damages caused associated with the 1991/92 National 1995 by floods. floods. University 31) Santa Fe Internal Economic Economic evaluation of flood Engineer April 12.0 Basins Economic evaluation of area. protection works, used to Alberto 1995 Studies prioritize investments under Viladrich the Flood Protection Project. 32) Goya Damage Evaluation of To better detail the damages National December 10.2 Assessment damages caused associated with the 1991/92 Technical 1994 by floods. floods. University of Resistencia 33) Corrientes City Same as above. Same as above. National December 10.2 Damage Assessment Technical 1994 University of Resistencia 34) Formosa City Same as above. Same as above. National December 10.2 Damage Assessment Technical 1994 University of Resistencia  30 35) Clorinda Same as above. Same as above. National December 10.2 Damage Assessment Technical 1994 University of Resistencia 36) Santa Fe City Same as above. Same as above. Litoral January 9.0 Damage Assessment National 1995 University 37) Santa Fe Hydrologic/hydra Permitted the detailing and Litoral February 217.0 Province Internal ulic protection budgeting for flood National 1995 Basin Diagnostic plan for city's protection works to be University flood area. executed in the Flood Protection Project for each city. 38) Damage Evaluation of To better detail the damages Alejandra March 2.0 Assessment damages caused associated with the 1991/92 Caruso 1995 Supervision by floods. floods. Suarez 39) Hydrological Hydraulic/hydrolo A non-structural measure Professor June 1997 12.7 Alert System gical alert system. which complemented the Juan B. physical works and Valdez established a link for the dissemination of pertinent data to all the provinces. 40) Benefits Regional study for Used to for the economic Dr. Juan December 23.0 Realized under Loan project's area of evaluation of the Flood Alberto 1996 3521-AR influence and Protection Project. Picasso respective economic evaluation. 41) Economic Same as above. Same as above. Jorge December 18.0 Benefits Realized Buerba 1996 under Project 42) Hydraulic Same as above. Same as above. Engineer December 18.0 Benefits Realized Fernando 1996 Under Project Gutierrez 43) Environmental Same as above. Same as above. Engineer January 14.4 Impact Realized Osvaldo 1996 Under Project Postiglioni 44) Hydraulic Same as above. Same as above. Engineer February 5.5 Benefits Realized Alejandro 1997 Under Project Bergman 45) Shelter and Survey and Used for identification of SUCCE and - Housing Study identification of benificiaries for both Flood the SUPCEs populations in Rehabilitation Project and the flood prone areas. Flood Protection Project. 46) Legislative Study the Permitted the systemization SUCCE Study legislation related of specific legislation and the to floods and their identification of additional or emergencies. modified legislation.  31 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 8A: Project Costs (US$ Million) Project Component Appraisal Estimate Actual/Latest Estimate Local Foreign Total Local Foreign Total Transport and Energy 30.8 21.2 52.0 71.5 0.0 71.5 Housing 21.1 0.0 21.1 23.2 0.0 23.2 Emergency Flood Control 38.2 25.5 63.7 86.3 1.5 87.8 Works Education Facilities 17.45 0.0 17.5 20.1 0.0 20.1 Health Facilities 5.1 0.0 5.1 8.1 0.0 8.1 Water Supply and Drainage 7.45 7.6 15.1 27.1 0.0 27.1 Institution Development 5.4 0.8 6.2 20.7 0.2 20.9 Expected Non-appraised 22.7 12.7 35.4 0.0 0.0 0.0 Projects Project Base Cost 148.2 67.7 215.9 Physical Contingencies 23.2 11.6 34.8 Price Contingencies 15.9 3.5 19.3 Total Project Costs 187.3 82.7 270.0 257.0 1.7 258.7  32 FLOOD REHABILITATION PROJECT (LOAN 3521-AR) IMPLEMENTATION COMPLETION REPORT Table 8B: Project Financing (US$ Million) Appraisal Estimates Actual Source Local Foreign Total Duties Local Foreign Total Duties Balance _& (Total Act - Total __ EAt.) Taxes Taxes National Government 40.0 0.0 40.0 20.9 35.7 0.0 35.7 15.1 (4.3) Provincial Governments 40.0 0.0 40.0 27.7 35.8 0.0 35.8 20.0 (4.2) World Bank (Loan 3280- 10.0 10.0 20.0 0.0 19.9 0.0 19.9 0.0 (0.1) AR 1st Emergency Amendment) World Bank (Loan 3521- 97.3 72.7 170.0 0.0 0.0 1.7 167.2 0.0 (2.8) AR) Total 187.3 82.7 270.0 48.6 257.0 1.7 258.7 35.1 (11.3) Financing Summary by Category Category Category Description Estimated Disbursement Actual Disbursement (US$ millions) (US$ millions) 1 Civil Works 128.9 133.5 2 Goods 13.4 2.5 3 Consultants 10.8 16.1 4 Housing 16.9 15.1 Total 170.0 167.2  Rate of Return for Selected Cities in the Upper and Lower Parana Basin* Year 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2009 2006 2007 200$ 2009 2090 2011 2012 projecpr Flood Control Investment (USS millions) Goya (prteleon for SO year event) 0.81 1.81 2.15 0.81 0.07 0.07 0.07 0.07 0.09 0.07 0.07 0.07 0.07 0.09 0.07 0.07 0.07 0.07 0.09 0.07 Santa Fe (Protectn for 100 yearevent) 7.41 14.83 19.77 7.41 0.91 0.91 0.91 0.91 1.24 0.91 0.91 0.91 0.91 1.24 0.91 0.91 0.91 0.91 1.24 0.91 Gualeguay(Protctionfor100 yearewnt) 0.96 1.12 1.49 0.56 0.05 0.0S 0.05 0.05 0.07 0.05 0.05 0.00 0.05 0.07 0.05 0.05 0.05 0.05 0.07 0.05 Ibicuy(protetionforI00year ewnt) 1.14 2.28 3.04 1.14 0.12 0.12 0.12 0.12 0.19 0.12 0.12 0.12 0.12 0.16 0.12 0.12 0.12 0.12 0.16 0.12 Resistenia (Protection for 150 yearoewnt) 3.17 6.33 8.44 3.17 0.26 0.28 0.28 0.28 0.38 0.28 0.28 0.28 0.28 0.38 0.28 0.28 0.29 0.28 0.38 0.28 Fomnosa(protectiofnfr750yearevent) 5.79 11.58 15.44 5.79 0.42 0.42 0.42 0.42 0.58 0.42 0.42 0.42 0.42 0.58 0.42 0.42 0.42 0.42 0.58 0.42 Clodnda(protectionfor50yearewnt) 3.77 7.53 10.04 3.77 0.17 0.17 0.17 0.17 0.24 0.17 0.17 0.17 0.17 0.24 0.17 0.17 0.17 0.17 0.24 0.17 V Conientes (protecortn for 100 year ewnt) 0.28 0.59 0.74 0.29 0.04 0.04 0.04 0.04 0.05 0.04 0.04 0.04 0.04 0.05 0.04 0.04 0.04 0.04 0.05 0.04 d Total investmient Costs 22.92 45.84 61.12 22.92 Cost of Operation and Maintenance 2.00 2.06 2.06 2.08 2.81 2.09 2.08 2.08 2.06 2.81 2.08 2.08 2.08 2.09 2.81 2.06 Avoidd dDamagn (US$millions) . Goya 0.0 0.0 0.0 1.2 32.0 0.4 0.4 0.4 0.4 0.4 0.4 0,4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 Santa Fe 0.0 0.0 0.0 0.0 10.8 5.3 5.3 5.4 5.4 5.5 9.8 5.6 5.7 9.7 5.8 5.8 5.9 8.0 6.0 6.1 Gualeogay 0.0 0.0 0.0 2.2 16.0 4.4 4.4 4.4 4.5 4.5 4.6 4.6 4.7 4.7 4.8 4.8 4.9 4.9 8.0 5.0 Z Ihicuy 0.0 0.0 0.0 1.7 3.0 1.1 1.1 1.1 1.1 1.1 1.1 1.1 1.1 1.1 1.1 1.2 1.2 1.2 1.2 1.2 Resislencia 0.0 0.0 0,0 25.0 116.3 20.4 20.6 20.9 21.1 21.3 21.5 21.7 21.9 22.1 22.4 22.9 22.8 23.0 23.3 23.5 Fomlosa 0.0 0.0 0.0 0,0 0.0 3.3 3.3 3.4 3.4 3.4 3.5 3.5 3.5 3.6 3.6 3.6 3.7 3.7 3.7 3.8 ,g Clorlnda 0.0 0.0 0.0 0.0 0.0 2.5 2.6 2.6 2.6 2.6 2.7 2.7 2.7 2.7 2.8 2.8 2.8 2.9 2.9 2.9 i Correntes 0.0 0.0 0.0 1.4 3.4 0.6 0.6 0.6 0.9 0.6 0.6 0.6 0.7 0.7 0.7 0.7 0.7 0.7 0.7 0.7 O i Total Benefit 0.0 0.0 0.0 31.5 197.5 39.0 38.3 38.7 39.1 39.5 39.9 40.3 40.7 41.1 41.5 41.9 42.3 42.8 43.2 43.8 Net Present Value Benefts -22.92 -45.84 -01.12 8.53 185.48 35.90 36.28 36.68 38.30 37.44 37.83 39.23 38.83 38.29 39.45 39.87 40.20 40.7i 40.39 41.57 3 IERR- 35.1% > O Lk) NPV (USt millions) a 041.9 Notes: Minimum Acceptable Rate of Retum = 12% ' Project lIfe = 20 years (commonly accepted life for rehabilitated earth works) Operation anci Maintenance = 2.2% of strucurai flood protection Inyesdment per annum and 3% every Onve yea0. Fmm 1998 to 2012, avoided damage is based an the average annual avoided damages (AAAD) per city (rnfnomatiOn provided by Borrower -^ Al figums in 1993 US Dolars AAAD are based on per capitaflgums, than as population increases so does AAAD. 19970Wo9M Bank Dewlopment Indicators reports that population growth for Argentina from 1995-2010 is expected to be 1.0% per annum. C