China - Liaoning Urban Transport Project

Document of The World Bank Report No: 36308 IMPLEMENTATION COMPLETION REPORT (TF-29447 TF-25511 SCL-44530) ON A LOAN IN THE AMOUNT OF US$150 MILLION TO THE PEOPLE'S REPUBLIC OF CHINA FOR A LIAONING URBAN TRANSPORT PROJECT June 29, 2006 Transport Sector Unit East Asia and Pacific Region  CURRENCY EQUIVALENTS (Exchange Rate Effective June 12, 2006) Currency Unit = RMB RMB 1.00 = US$ 0.124 US$ 1.00 = RMB 8.05 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS ASPT - Anshan Public Transport MV - Motorized Vehicle ASTM - Anshan Traffic Management MVECS - Motor Vehicles Emissions Control Strategy ATC - Area Traffic Control NCB - National Competitive Bidding CAS - Country Assistance Strategy NMV - Non-Motorized Vehicle EA - Environmental Assessment NPV - Net Present Value EAP - Environmental Action Plan PAD - Project Appraisal Document EIA - Environmental Impact Assessment PHRD - Policy and Human Resources Development EPB - Environment Protection Bureau Fund ERR - Economic Rate of Return PIP - Project Implementation Plan FSPT - Fushun Public Transport PPMO - Provincial Project Management Office FSTM - Fushun Traffic Management PO - Project Office GOC - Government of China PSR - Project Supervision Report ICB - International Competitive Bidding PT - Public Transport ICR - Implementation Completion Report RAP - Resettlement Action Plan LUCRPO - Liaoning Urban Construction and SOE - Statement of Expenditures Renewal Project Office SYPT - Shenyang Public Transport LUTP - Liaoning Urban Transport Project SYTM - Shenyang Traffic Management MOF - Ministry of Finance VOC - Vehicle Operating Costs Vice President: Jeffrey Gutman, Acting EAPVP Country Director David R. Dollar, EACCF Sector Manager Jitendra N. Bajpai, EASTR Task Team Leader/Task Manager Shomik Mehndiratta, EASTR  CHINA CN-Liaoning Urban Transport CONTENTS Page No. 1. Project Data 1 2. Principal Performance Ratings 1 3. Assessment of Development Objective and Design, and of Quality at Entry 2 4. Achievement of Objective and Outputs 7 5. Major Factors Affecting Implementation and Outcome 14 6. Sustainability 15 7. Bank and Borrower Performance 16 8. Lessons Learned 19 9. Partner Comments 21 10. Additional Information 32 Annex 1. Key Performance Indicators/Log Frame Matrix 33 Annex 2. Project Costs and Financing 37 Annex 3. Economic Costs and Benefits 40 Annex 4. Bank Inputs 43 Annex 5. Ratings for Achievement of Objectives/Outputs of Components 46 Annex 6. Ratings of Bank and Borrower Performance 47 Annex 7. List of Supporting Documents 48 MAPS 1. Shenyang Map (IBRD No. 30063R) 2. Fushun Map (IBRD No. 30062R) 3. Anshan Map (IBRD No. 30061R)  Project ID: P041890 Project Name: CN-Liaoning Urban Transport Team Leader: Shomik Raj Mehndiratta TL Unit: EASTR ICR Type: Core ICR Report Date: June 29, 2006 1. Project Data Name: CN-Liaoning Urban Transport L/C/TF Number: TF-29447; TF-25511; SCL-44530 Country/Department: CHINA Region: East Asia and Pacific Region Sector/subsector: Roads and highways (89%); General transportation sector (7%); Sub-national government administration (4%) Theme: Infrastructure services for private sector development (P); Pollution management and environmental health (P); Municipal governance and institution building (S); Access to urban services and housing (S) KEY DATES Original Revised/Actual PCD: 03/29/1996 Effective: 06/01/1999 12/28/1999 Appraisal: 02/25/1999 MTR: 06/01/2001 12/18/2002 Approval: 03/30/1999 Closing: 12/31/2004 12/31/2005 Borrower/Implementing Agency: PEOPLE'S REPUBLIC OF CHINA/Liaoning Urban Construction and Renewal Project Office (LUCRPO) Other Partners: STAFF Current At Appraisal Vice President: Jeffrey S. Gutman Jean-Michel Severino Country Director: David R. Dollar Yukon Huang Sector Manager: Jitendra N. Bajpai Jitendra N. Bajpai Team Leader at ICR: Shomik Raj Mehndiratta Richard G. Scurfield ICR Primary Author: Rakhi Basu 2. Principal Performance Ratings (HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=Highly Unlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible) Outcome: S Sustainability: L Institutional Development Impact: M Bank Performance: S Borrower Performance: S QAG (if available) ICR Quality at Entry: S Project at Risk at Any Time: No  3. Assessment of Development Objective and Design, and of Quality at Entry 3.1 Original Objective: The development objective of the project (PDO) was to improve urban transport system productivity so as to facilitate economic and social development within the project cities. Specifically, the project was designed to: (1) alleviate bottlenecks in the road system through the development of high grade facilities, secondary roads, rail crossings, missing links and widenings, (2) increase efficiency and effectiveness of the public transport (PT) through the development of bus corridors and passenger facilities and modernized maintenance facilities; (3) improve maintenance of road investments through development of modernized and sustainable pavement management system; (4) improve environmental sustainability of project investments through development of a motor vehicle emissions control strategy (MVECS); (5) improve operational efficiency and safety of the road system through channelization of modal traffic and development of Non Motor Vehicle (NMV) facilities, signalization and other traffic management measures; and (6) strengthen local capacity of urban transport system management through study tours, technical assistance and targeted training. 1/ Assessment of Objectives - The objectives of the project were clear and supported the Government's priorities of the time. The major issues facing the urban transport sector in China stemmed from increasing motorization, rapid urbanization, inefficient public transport and poorly coordinated institutional arrangements for managing urban traffic. Specifically, urban traffic congestion was already an important constraint to urban productivity. To address these issues, a symposium was held in Beijing in 1995, and identified five principles that should guide urban transport planning and operations in China. The 2/ sector-related Country Assistance Strategy goals of the project were to: (i) promote growth with economic stability; (ii) alleviate infrastructure constraints; and (iii) safeguard the environment. For the three project cities of Shenyang, Fushun and Anshan, the project was designed to contribute to these goals by increasing city-wide productivity and raising the standard of living for the cities' inhabitants, through targeted and sustainable improvements to the urban transport system. From a sectoral perspective, this was the third urban transport operation undertaken by the Bank in China in the early-to-mid 1990s. At the time of appraisal, the road network in the three project cities was inadequate with poor conditions on the secondary and tertiary system. Public transit was steadily losing mode share to minibus and auto/taxi travel due to slow operating speeds (in the city center public transport speeds averaged 12 km/hr. and 5-8 km/hr. in the peak period), and a poor route and transfer network. A public transport reform program had been initiated in each city to maintain and attract public transport riders through improved services while reducing the need for subsidies. Limited application of traffic ____________________________________ 1/ It should be noted that the development objective (DO) in the PAD are not consistent with the objective stated in the legal agreement, but is not different in substance. The report has used the DO from the PAD since it was more complete. 2/ The suggested actions based on these principles were the following: (i) reform urban transport administration; (ii) upgrade the status of traffic management; (iii) prepare a strategy to mitigate motor vehicle air and noise pollution; (iv) develop policies to manage traffic demand; (v) develop a strategy for mass transit; (vi) reform public transport management and operations; (vii) develop a financing strategy for the transport sector; (viii) strengthen the framework for transport planning and capacity building. - 2 -  management measures primarily due to a lack of knowledge of traffic management practices had resulted in deteriorating road conditions. In all three cities, comprehensive planning, regulation and policy-making for the sector were weak, and traffic management and planning activities were not well developed or coordinated. Viewed against this background, the project objectives were clear and well related to the analysis of the issues in the sector and responsive to the borrower's needs at that time. The rationale of the project was rooted in the traffic management program which was expanded in scope from area traffic control to include other elements such as channelization, NMV route development and parking, and in the road maintenance component which was expanded from equipment purchase to include some rehabilitation works. However, the most significant redesign of the infrastructure component during project preparation supported transformation of the public transport component to include public transport reform and the provision of bus priority facilities. As a result, this component evolved from one which was heavily vehicle-oriented to a broader based program of reform and investment. Thus the project objectives represented a balanced emphasis on physical works and institutional capacity building in the sector. However, the project was ambitious, and contained features, some of which were in advance of their time. In retrospect, what made the project's strength, the new ideas and concepts it introduced were also its major weakness. Besides traditional elements of road upgrades and expansions, it included bold actions on road maintenance, traffic management and bus priority. Therefore, it was complex with regard to institutional arrangement, scope and design. There were three cities, each with four subcomponents, a large number of investments in each component, to be managed by several institutions. The project was risky due to the introduction of new concepts in light of weak local experience and institutional capacity. While these risks were well worth taking to advance the thinking on traffic management and bus priority, these components were designed without a full understanding that a significant cultural shift had to occur for some of these concepts to be successful. This was a notable weakness in the project and was felt throughout its life. 3.2 Revised Objective: The project development objectives have remained unchanged. 3.3 Original Components: There were four components, one each for the cities of Shenyang, Fushun and Anshan, and a fourth component for institutional strengthening and technical assistance (TA). Each city component comprised of four subcomponents: public transport, traffic management, infrastructure, and road maintenance. In general, the investment components in each city were designed to achieve the corresponding objectives 1, 2, 3 & 5 above, while the institutional strengthening was designed to achieve objectives 4 & 6. The components were scoped taking account of the sector issues in each city discussed in Annex 15 of the PAD. The subcomponents in each city were: Shenyang Public Transport. Construction of a bus maintenance repair facility, bus terminus and bus priority facilities, including a proposed exclusive center-lane busway. Traffic Management. Traffic management improvements to 38 local roads including channelization of intersections, road widening, an area traffic control system, traffic signs and markings, the development of pedestrian facilities and the provision of 18.1 km of NMV exclusive roads. - 3 -  Road Infrastructure. Construction of three major east-west corridors: Beiye-Lianhe corridor,. the Jianshe-Nanwu Road improvements and the Pangjiang Jie Street section of the First Ring Road. It also included the construction of the Gonghe Railway overpass, the Gonghe Interchange, the Fangxinig Square interchange. Road Maintenance. Re-surfacing and reconstruction of 43 local roads, and the purchase of road maintenance equipment. Fushun Public Transport. Provision of modern bus maintenance equipment and development 6.7 km of exclusive bus priority facilities on existing and improved roads. Traffic Management. Improved traffic management facilities along two major road corridors and in one area, and seventeen junctions will be included in a coordinated traffic control system. Road Infrastructure. Construction of 18.5 km Hunhenan expressway along the south bank of the Hun River, and a parallel 18.3 km local service road. The project will also finance the Wanxin bridge and interchange. Road Maintenance. Reconstruction and paving of 15.5 km of roadway, along four routes and purchase of modern road maintenance equipment. Anshan Public Transport. Construction of 6.2 km of tramway and 5.4 km of busway, purchase of equipment, and construction of a bus transfer station which will serve 17 bus routes. Traffic Management. Channelization of eight junctions, development of 5.6 km of NMV exclusive roads, and finance of off-street parking facilities, provision of traffic signal equipment, signs and marking, and specialized management vehicles. Road Infrastructure. Construction of nine facilities including improvements to the principal north-south (Jianguo) corridor in the city, the Wuyi interchange, and the Shahe Bridge (which will provide an improved truck route to the north of the city). Road Maintenance. Reconstruction of Hongqi Road (4 km), sidewalks along six roads, and selected improvements to other urban roads. The TA component consisted of consulting services to support project management, (bidding document preparation and construction supervision), domestic and international training and seven studies: (i) Bus priority design; (ii) Public transport reform; (iii) Area traffic signal control (ATC) system; (iv) Parking policy; (v) Traffic accident analysis; (vi) Road Maintenance plans; and (vii) Motor vehicle emission control strategy (MVECS). 3.4 Revised Components: During the first year of implementation, Shenyang informed the Bank that the city was going to construct a major new East-West Expressway through the city center. Such construction was inconsistent with the basis of the Bank-financed road infrastructure component in the city which was designed on the - 4 -  understanding that a major new road building within the center of the city should be avoided as far as possible. The proposal to construct this major new road, announced without any consultation with the Bank, undermined some of the rationale for the original Bank-financed component in Shenyang. A reappraisal of the value of the subcomponents that were to be financed by the Bank in Shenyang, was therefore required. The main changes resulting from the reappraisal were the cancellation of the Jianshe-Nanwu expressway and the extension of Beiyi Lu out to the second ring road. The public transport component was also changed: the bus maintenance facility and the Da Dong bus terminal were dropped because of land acquisition difficulties. The Fushun road infrastructure component was also modified; the Project financed a different bridge (Yong'An) from the one originally appraised (Wang Xin). A summary of the most significant changes to each project component is provided below. Shenyang Public Transport. The bus maintenance facility and the bus terminal were deleted. This reduced the total cost of the component by more than 75%. Traffic Management. The main change was redesign of the NMV roads for non-motorized vehicles. Road Infrastructure. The Jianshe-Nanwu expressway was cancelled and a 4 km section was included to extend the Beiyi Road westwards to the Second Ring Road. Road Maintenance. This component increased significantly in size from 43 roads with a length of 51 kms to 67 roads with a length of 76 kms. Seven new roads were added to the original list of 15 road sections. Fushun Road Infrastructure. Replacement of the construction of Wanxin Bridge with the reconstruction of Yongan Bridge. Road Maintenance. Some road sections were added to the maintenance works, and expansion joints were placed in the existing bridges. Anshan Road maintenance. Investment was increased from one road 4 kms. long to include seven roads with a total length of 20.86 kms. Revised Component Summary Overall, the revisions were not major, the most significant being the use of the unallocated amount and a shift in loan funding from works for construction of road infrastructure to works for road maintenance (supporting project objective 3 to improve maintenance). A smaller reallocation increased the amounts to be spent on traffic management in support of project objective 5. There was no restructuring, and so the reallocation was presented to the Board, for approval on a "No Objection" basis. 3.5 Quality at Entry: There was no formal quality at entry assessment. Based on the analysis undertaken for the ICR, the quality at entry of the project is rated moderately satisfactory. - 5 -