Ghana - Highway Engineering Credit Project

r7 |t L'AL7 L L ~.' L1 ||>=7 r-' Tt z_A R ESTRI! TE D | b- R;gsk 4r J71J J I Report No. PTR- 1 la _____ 1 Fn miv1>av This report wcis prepared for use within the Bank and its affiliated organizations. They do not accept responsibility for its accuracy or completeness. The report may not be published nor may it be qujoted as reprosenting their views. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION PfROE f r I S'OSA L FG fR A H:IGHWAY ENGINEERING CREDIT GHANA June 9, 1969 Transportai:ion P:rojects Department  Currency Equivalents: Currency unit New Cedi New Cedi 1 = US$ 0.98 New Cedi 1 million = US$980,000 Fiscal Year: July 1 - June 30 Units of Weights and Measures: British British/US: Metric Equivalents: 1 mile (mi) = 1.6 kilometers (km) 1 foot (ft) 30.5 centimeters (cm) 1 acre = 0.41 hectares 1 ton (long = 1.016 metric tons ton) Abbreviations: UNDP - United Nations Development Program USAID - United States Agency for International Development  GHANA flAlf'OATLIn UTrtPT.mA V LThTP. T'tVT3TMP Table of Contents Page No. I. SUMMARY ............ ... . 1 II. BACKGROUND 2. . ....2 III. 'TH PRRWEECT.. . *... 4 IV. ECONOMICEVALUATION.. 6 V. RECOMMENDATIONS.. 7 Annex 1 - Design Standards and Preliminary Estimates of Construction Cost Annex 2 - Cost Estimnates MAP - National Highway Network This report is based on the UNDP financed Ghana Highway Study carried out by consultants in 1967-68 and the findings of an Association mission to Ghana in November 1968 consisting of Messrs. Morris (hiahway engineer) and Parthasarathi (economist).   GHANA PROPOSED HIGIlWAi ENGINEERN1G 'AnEDIT I. SUMMARY 1.01 The Government of Ghana lhas requested assistance from the AssociatiorO for financing the detailed engineering, including preparation of tender docu- ments, for the construction of 235 miles of roads on the following two routes (see Map): (1) Accra-Kumasi (128 mi) (2) Takoradi-Kumasi (107 mi) The estMiated cost of the pro3eit is USt2.2 million, divided almost equally between the two roads. Feasibility studies, financed by UNDP, for these road projectsi show,that ther ,onstruction would give economic rates of return of over 20%, and completion of detailed engineering is therefore justified. Accra/Te.ma is the cap . -A , a largsat ritvy Kfumani is the second largest and Takoradi/Sekondi the third largest; Tema and Takoradi are the country's two ports. Preliminary esti-mtes Of construction cost are US$25 million for the Accra-Kumasi Road and US$20 million for the Takoradi-Kumasi Road. A provi- sional scheduLe -would be for construction to be started in late 1971 and to take about 30 months. The proposed credit of US$1.5 million would cover the foreign exchange cost of consulting services; an appropriate term for the credit wrould be 10 years including a 2-year period of grace. 1.02 The Government. in consultation with the Association, has selected two firms and negotiated draft contracts for carrying out the detailed engi- neering. The contracts will be signed before the signing of the proposed credit agreement. 1.03 This report is based on the UNDP financed Ghana Highway Study carried out by consultants in 1967-68 and the findings of an Association mission tc Ghana in November 1968 consisting of Messrs. Morris (highway engineer) and PArthaiarathi (eeonnmist).  - 2 - II. BACKGROUND 2.01- Gh&nr,a i1s lo cated in tbe middle of 4t1he south'1ern coast' of We~st 4Africa with Ivory Coast to its west, Upper Volta to the north and Togo to the east. .I h Lias an aea of' 9CUU2,000 sq. miL., MWLULJAt the.L4C Us o.LI th CUe.J.4 L%fRpLAIJ.L.LL; of Germany. The southern part of the country is rolling terrain covered by trop- ica.I forests, -with sa-vannah replac-ng luorest frther to the north. rPpuM.LULi in 1968 was estimated at eight million, with a growth rate of about 2.7% a year. 2.02 The share of agriculture in Ghana!s gross national product is abOut 50%, of which one-third is accounted for by cocoa cultivation. In 1967, GNP in 1960 prices amounted to US$i,i25 miiiion, equivalent to a per capita Gir of US$140. GNP growth since 1960 has averaged only 2.5% a year, resulting in a small decline in per capita GNP over the period. 2.03 Ghanais highway network totalled about 20,000 miles in 1968, of which 6,200 miles (2,400 miles paved and 3,800 miles gravel) constituting the primary system are the responsibility of the Public Works Department, and the rest, mainly rural feeder roads, are the responsibility of the various local authorities under the Ministry of Local Government. Apart from the 600-mile railway system in the south which connects the three principal urban areas of Accra/Tema, Kumasi and Takoradi/Sekondi, the highways constitute the basic transportation system. The railway is the main carrier of the principal ex- port commodities of cocoa, timber, bauxite and manganese ore which constitute over 90% of its freight traffic of about 2 million tons a year. For trans- portation of other goods and passengers, however, the highways are of prime importance. 2.04 The number of motor vehicles in Ghana increased from about 35,000 in 1957 to 53,000 in 1963, an average annual growth of 7%. Since 1964, how- ever, because of the generally adverse economic conditions in the country, the size of the vehicle fleet has stayed around 50,000, of which over 50% are cars, some 40% trucks and buses and the rest motorcycles. 2.05 Internal transport is almost free of Government regulation. Railway rates and fares are set by the Railway Corporation and truck rates and bus fares by the various operators, only one of which, the Government-owned State Transport Corporation, is a large scale operator with over 300 vehicles. How- ever, the railway is exempt from all taxes, while bus and truck operators are not. Receipts from highway user charges (principally gasoline taxes, vehicle license fees and purchase taxes on vehicles and spare parts) exceed the present inadequate level of maintenance expenditures by about one-third to one-half. There is no machinery to deal with these problems nor with coordinating trans- port investments, but the Government intends to create an Office of Transport Coordination in the Ministrv of Communications. The consultants now carrying out a transport study under USAID financing (para 2.08) will also consider nroblems of coordination and make recommendations for dealing with them. 2 06 A BAnk mission to Ghana in 1966 identified three high priority needs in the highway sector:  (a) the improvement of the existing inadequate roads or the construction of new roads on more direct alignments, between: (i) Accra-Kumasi and (ii) Takoradi-Kumasi; (b) the improvement of rural feeder roads; and (c) the improvement of the Government road maintenance organization, equipment, and onerations. At the request of the Government, te-rms of reference for studies were drafted by the Bank, to form the basis of an application to UNDP for a grant. However, USAID indicated interest in providina aSRiRtAnce to the G-overnment for the studies of items (b) and (c) above. The Governmentts application to UNDP was made for only item (a), and a lNDP grant of US$420,000 as apnproved ea-rly in 1967. The Bank was appointed as Executing Agent. The Swedish consultants, Kiessler and Man-nerstrale, were engaged in March 1967 to ca-ry out the feasi- bility studies of the two roads in item (a); their reports on the completed studies were received in November 1968. 2-07 A stilav of feeder roads is being carried out by a tea supplied Jointly by the Building and Road Research Institute of Kumasi University in Ghan-a and USAID. The Govrernment has started work on the improvemend Of some high priority feeder roads already identified by the study. 2.08 A transport study, financed by a USAID loan and being carried out ht ...As-er*..'. Consu.tnts, Rob-ert R. Nathan Assocites, started iLn Jnua,r.y 1969 anid is expected to take about 18 months. The study will cover all moles Of trnsport , in c. u(ig tCheir cwordination, management, investment pri orit.:les and budigeting. In particular, it will include studies and recommendations for provement- of the Gover.rment rowr Udinistratio-n, maintenaLnce orgari- zation, equipment and operations. The Association has informed the Government and USA:M of its spec:Lai inte.rest in the study and the Government agreed diring negotiations to keep the Association informed of its progress and to discu3s the imp:Lementation of the finding, especially on road maintenance. 2.09 In the meantime, the Government is considering immediate measures to improve road maintenance; the Association has suggested to the Government that these sho-uld include formulating and starting to implement a program to overcome the large backlog of periodic maintenance, such as resealing of b:itu- miunous surffaced roads and regravelling of unpaved roads. The Government, during negotiations, agreed to keep the Association informed of the progress off these measuxres.  -4- III. THE PROJECT 3.01 The nroject consists of the detailed engineering and nrenaration of bid documents by consultants, for new alignments of two main roads: (a) Accra-Kumasi 128 mi (b) Takoradi-Kumasi (part) 107 mi 235 mi The engineering will in general follow the alignments established by the feasi- bJi.Lty studies finLaced bi -y the UJiI gr (Mlpl \iIC4). A. ecCra-K-UMIsi I-oua 3.02 The road connects the capital, Aecra, and the adjoining principal port of Tema (a combined population of about 540,000) with Kumasi, the second largest city (population 260,000). All the routes to the north of the count'ry radiate from Kumasi. The existing road via Kibi has a bituminous pavement of inadequate strength and its condition varies from poor to very poor. The pave- ment is narrow, from 18 to 20 feet, as are the shoulders. Drainage is inade- quate. The terrain is mostly rolling, and hilly in parts. The alignment on about a quarter of the total length is bad, with sharp curves, steep gradients and insufficient sight distance. Travel speed is generally within the range of 25 to 40 mph. The distance from Accra to Kumasi by the existing road is 168 mi, whereas by the proposed new direct route it would be only 134 mi (of which 128 mi would be new construction). 3.03 The feasibility study showed that a new road should be built on a direct route rather than that the existing road be improved. The design for the new road will provide for a two-lane bituminous surfaced pavement on an alignment having a 60 mph design standard with no steep gradients (see Annex 1). B. Takoradi-Kumasi Road 3.04 The road connects Takoradi (population with adjoining Sekondi 125,000), the second main port which handles much of the export tonnage, with Kumasi. There are two existing roads, both inadequate and unnecessarily long. The shorter one, which is chiefly used, is via Cape Coast, far to the east of the direct line. It has a bituminous pavement of insufficient strength, is in poor condition, and is under 20 feet wide for about half its length. The other road is via Tarkwa, far to the west, and Dunkwa; it also has a bitumi- nous pavement except for about 35 mi between Bogoso and Dunkwa. The 60 mile section between Dunkwa and Kumasi is paved and, with the exception of about 10 mi near Kumasi, is of adequate standard. The paved sections between Dunkwa and Takoradi are inadequate in strength, width and alignment, and are in poor condition. The unpaved section is narrow, poorly aligned, sunken and badly drained, and is often impassable during the rainy season. The length of the existing road via Cape Coast is 185 mi and that via Tarkwa is 188 mi.  3.05 The feasibility study revealed that the best economic solution is to buiLd a new road on a direct alignment between TakoraUdi and Lu-ikwa, w1ith1 spurs to connect with Tarkwa and with Beposo (on the Takoradi-Cape Coast-Accra Road). The route would then foliow the existing road between Dunkwa and Kumasi except for a new alignment of about 9 mi near KPumasi. The total dis- tance between Takoradi and Kumasi will be reduced from 185 mi to 139 mi. The detailed engineering for the 107 mi of new alignment (including the two spur roads) will be for a 2-lane road of 60 mph design standard, avoiding steep) gradients (see Annex 1). C. Execution 3.o6 The Public Works Department of the Ministry of Works will be respon- sible for the project. The Department obtained proposals from a number of consulting firms acceptable to the Association for carrying out the engineering services forming the project. Out of the six firms who submitted proposals, the Government, in agreement with the Association, selected the French firm Ingeroute (for the Accra - Kumasi highway) and the American firm Louis Berger (for the Takoradi - Kumasi highway) and has negotiated draft contracts accept- able to the Association. The contracts will be signed before the signing of the proposed credit agreement. 3.07 The estimated total cost of the engineering project is US$2.2 million equivalent, of which the foreign exchange component (to be financed under the credit) is expected to be US$1.5 million, or about 70% (see Annex 2). The local costs of about US$700,000 would be met by the Government and assuraznce of this was obtained during negotiations. The cost estimates have been de- rived from the draft contracts negotiated with the consultants. 3.08 The duration of the project would be two years. Assuming the credit becomes; effective in mid-1969, a forecast of the annual disbursements, ancL local funds cash flour would be: In US$ million (US$1 = New Cedi 1.02) 1969 1970 1971 Total Annual disbursements 0.4 0.9 0.2 1.5 (foreign cost) Local costs 0.2 o.4 0.1 0.7 Tot&l costs n.6 1.- 3_ 2.2 no rAAe! cor.sactst -io +he t ,a.. + os 1A --. a+ -^siiA Td U iS4 +o 50 mil 3.i .*L LJUOV.LI.J&.5 . 14 u.W% - -C "%.L*.D _W - --V _ -- lion and would form the basis of a future project. A tentative aim would be for a proy. tjJ o be -a --- - -pproA --A e c c on+a Vo be awarded by September 1971, in time for the dry season. Construction wculd tU.hen tske abbourt 30 montiLls. Nio proltles are anticipated in acquiring 4t he ri ght of-way; most of the land is already Government owned and the Government has audequatue po-iers to acquire the remainer.  IV. ECONOMIC EVALUATION 4.01 The economy of Ghana is expected to grow at 4-5% a year in the next few years. In line with this, highway traffic is expected to grow at 5-6% a year. This is a somewhat conservative estimate sinee the railway traffi4 ij5 largely confined to bulk export goods like cocoa, timber, bauxite and manga- nese ore, whose total volume is not expnectedi tn regiQtPe any large in'reiRe, and the roads would have to carry most of the general traffic whose increase would be more dirpntlv relatpd to national income growth. The area served by the project roads contains over 60% of the population, including the three lsr0at urban aoreas of Accra/Tma, Kumsl and Takoradi/Sekond4, and has the greatest potential for future economic growth. 4.02 To provide a basis for traffic forecasts to evaluate the proposed road 4iprovements, the Pbl4c Workl 4 _---- mnt m automati raf-P-P-4c coun+s r -w-s -~~~~~~~~~~~~~~~~~~~~~~~~~~~~~_ __p nV_ vF-; %&- v-s ,>- V.L - v 4..La at several points on the Accra-Kumasi-Takoradi routes during March-August 1967, -. d o r i gi4-n=~de-stir,nat-ion sunveys dd r-ing T.ly-1 .A.-s 96. Ths trafi studies-P ----44_ ~S' .'~ *+~~J.~aL ~~LL V~j~ ~.LA.AJ.JL ULL.LJUrAe LLDUO J.7 I LLA01 LIL LL. L.L% LLA%.LC0 showed that there were, on average, 1,050 vehicles per day on the Accra-Kumasi route, 4 of whi.h 40%wer cars ar.d Ah rest coreris veice -tuk - ---d. * ~~ 'J* `L~ _w/. W-UL 1 0 L1U. IJ 1CO0L. vUAIUI%L;.L. V xurucl - aOUU buses). At present, of the two routes connecting Accra to Kumasi, the route vr;o Kf -P "-Aslo 1A 41. b o1 A I-- I 1- o 1 4 Sh| I ss tha bAl _t ;_1,| 4-r PP c and ._- *.O - / * C> o g- J7. J .LS %'I L JLO.. Le %, cJf %A2 L. s JA the route via Kibi (also 168 miles long) the rest. The new road will be 134 -lez long, a s, 0irV.L1, of1 34 miles in travel diU.Lstlce, andu Lha-ve bUtLeCr des and alignment features. About 75% of the traffic, representing the entire t;=ougL trafc - W-ll U.LvCrt to the ne-w roadu wnen it, is built. Because of the substantial reduction in travel distance and consequently in travel costs, some additional traffic -would also be generated from existing areas of econo- mic activity; such traffic is estimated to amount to 10% of diverted traffic in the beginning, rising to 20% or more in the course oI 10-15 years. In ad- dition, the new road would open new areas for settlement and economic activity, givirng rise to new production of timber as land is cleared and then to crops as cultivation starts. All of these benefits together are expected to yield an economic return of 22% over an estimated 20-year economic lire ror the new road, including costs of construction, engineering, supervision of construc- tion and right-of-way. 4.03 On the Kumasi-Takoradi route, the number of vehicles per day was on average 560 in 1967, of which 20% were cars and the rest commercial vehicles. The present road is 185 miles long, but the new road will be only 139 miles, saving 46 miles in travel distance and will have better design and alignment features. Almost 90% of the traffic, representing through traffic, is ex- pected to divert to the new road. In addition, as in the case of the Accra- Kumasi road, there will be substantial generated traffic from existing areas of economic activity and additional production resulting from the opening of new areas for settlement and cultivation. Together these benefits are esti- mated to yield an economic return of 23% over the 20-year economic life of the new road.  - T - V. RECOM nAJTIONS 5.01 The proposed project has been well prepared and the Government, in consu:ltation with the Association, has selected two firms and negotiated draft contracts for carryJing out the detailed engineering comprising the project. the signing of such contracts is expected shortly and would be a condition of effectiveness of the proposed credit. 5.02 During negotiations, agreement was reached with the Government on the folloving principal points: (i) provision of the local funds necesseay to carry out the project (para. 3.07); (ii) keeping the Association informed of progress on the transport sector study and consultation with the Association on the implementation of its recommendations, including particularly those pertaining to road maintenance (para. 2.08); (iii) keeping the Association informed of interim measures taken to deal with the backlog of road maintenance (para. 2.09); and (iv) refunding the proposed credit, if requested by the Association, out of the proceeds of any future Bank loan or IDA credit fcr construction of the highways to be engineered under the proposed credit. 5.03 The proposed project is considered suitable for a credit of US$1.5 million equivalent for a term of 10 years including a 2-year period of grace. June 9, 1969   ANNEX I EKO,osed Engirneering Credit for Highways Design Standards and Preliminary Estimates of Construction Cost A. Design Standards (proposed by consultants in feasibility studieo financed by UiD?P): i. Design Speed 60 m.p.h. 2. Max. Gradient 5% for max. length of 800 ftj. 7% for max. length of 500 ft. 3. Width of surfacing 24 ft (for design hourly vo:Lunes over 200 vehs/hr) 22 ft (for design hourly voLumes 100 to 200 vehs/hr) 4. Design wheel load (pavement) 10,000 lbs. 5. Design bridge loading BS 153, Type HA. B. Construction (_ost (preliminary estimates nrepared by consultants in feasibility studies financed by UNDP): Estimated Cost of Consru+- + 4on US$ million (i) Accra - Kumasi Road 25 (ii) Takoradi - Kumasi Road 20 Total (including contingencies) 45 Note: US$ 1 = New Cedi 1.I02 February 28, 1969  ANNEX II MHANA Proposed Engineering Credit for Highways tTa+v Etia+mn4-le Foreign Local Total Exchange Cost Cost US$ US$ USTg- (i) Detailed Engineering of 700,000 305,000 1,005,000 1/ Accra - r11mAq1 hi ghwaynu (lump sum contract) (ii) Deailed E of 665,000 330,000 995,000 2/ Takoradi - Kumasi highway (iii) Contingencies (10%) 135,000 65,000 200,000 Totals 1,500,000 700,000 2,200,000 Total Foreign Exchange Cost US$ 1,500,000 equivalent (to be financed under the Credit) 1/ Based on contract negotiated with Ingeroute (France) 2/ Based on contract negotiated with Louis Berger (US) Note: US$ 1 = New Cedi 1.02 June 5, 1969  Li P P E R Y O L T A PR C. pNandom ~ ; ~ s/( \ ,goMwla ) _ .- r i A 9 z iti~~Nr ( ~~~Goasoo( Xju Y , ilSl 4rUZ csO -f yl-KI.- 'S\v\^t~~~~bini i A sta , HN Wi Ut so V L. <sAIOKI PLA R9U2X/VhF\