Morocco - Third Water Supply Project

Document of The World Bank FI COP FOR OFFICIAL USE ONLY Report No. P-3061-MOR REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE KINGDOM OF MOROCCO FOR A THIRD WATER SUPPLY PROJECT May 6, 1981 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.  KINGDOM OF MOROCCO THIRD WATER SUPPLY PROJECT FISCAL YEAR January 1 - December 31 CURRENCY EQUIVALENTS Currency Unit Dirbam (DH) DH 1 US$0.24 US$1 DH 4.20 WEIGHTS AND MEASURES Metric System British/US System 1 meter (m) 3.28 feet (ft) 1 kilometer 0.62 miles (mi) 1 bectare 2.47 acres GLOSSARY OF ABBREVIATIONS ONEP Office National de l'Eau Potable FEC Fonds d'Ecuipement Communal (Communal Infrastructure Fund)  FOR OFFICIAL USE ONLY KINGDOM OF MOROCCO THIRD WATER SUPPLY PROJECT LOAN AND PROJECT SUMMARY Borrower: Kingdom of Morocco Beneficiaries: The Office National de l'Eau Potable (ONEP); the water supply agencies (Regies) in the cities of Casablanca, Fes, Marrakech, Meknes, Tetouan, Safi, Oujda, Tanger, Rabat-Sal6, Taza and Kenitra, as well as other Regies which may be agreed upon during project implementation; the Hydraulics Department of the Ministry of Equipment; and a government agency to be designated sbortly. Amount: The equivalent of US$87 million. Terms: Seventeen years including four years, of grace, at an interest rate of 9.6 percent per annum. On-Lending Arrangements: The Government will onlend the proceeds of the loan allocated to ONEP (about $45.8 million) and the Regies (about $38.1 million) on terms identical to the loan's, as in the financing plan below. The Government would use the remaining $3.1 million for the water resource development component and for the rural water systems study. Project Description: The primary objective of the project is to improve access to safe water supply of the low income population of at least 11 major towns and 80 smaller centers, and to bring water or improved water supply to the population around Karia Ba Mohamed and in'the Ziz valley from Errachidia to Erfoud, as well as on the Tafilalet plain around Rissani. The project consists of: (i) revolving funds to finance credit granted to low income households for house connections in at least 11 major cities and about 80 other population centers; (ii) a line of credit to ONEP, referred to later as the sector loan component, for subprojects consisting of improvements and expansion of water supply facilities in about 32 small centers; (iii) construction of two regional water supply systems, in the areas of Karia Ba Mohamed (about 7,300 | 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.  - ii - inhabitants), and Errachidia - Erfoud - Rissani (170,000 inhabitants); (iv) the development of water resources in some 24 centers; (v) the acquisition of laboratory equipment, water meters, leak detection equipment and materials, and eauipment for maintenance and surveys; and (vi) technical assistance, training and studies. The beneficiaries of the project would consist of (i) approximately 1.6 million low income inhabitants of the cities and other centers referred to above, constituting about 275,000 households who would finance their house connections through the revolving funds financed under the loan; and (ii) some 600,000 people living in the small centers served by the two regional systems or in the centers to benefit from the sector loan component. The implementation of the project does not pose any special risks. Estimated Cost: The total project cost is estimated at US$169 _ million apportioned as follows: Local Foreign Total % of Item -------US$ Million--------- Total A. Sector loan component 15.6 10.0 25.6 15 B. Regional Water Supply Systems 16.5 9.5 26.0 15 C. Equipment and Materials 1.6 1.8 3.4 2 D. Water Resources Development 2.9 2.3 5.2 3 E. Consulting Services, Technical Assistance and Studies 4.5 3.4 7.9 5 Base Cost 41.1 27.0 68.1 40 Physical Contingencies 3.5 2.2 5.7 4 Price Contingencies 9.5 6.0 15.5 9 F. Fund for House Connections 27.9 51.8 79.7 47 Total Project Cost 82.0 1/ 87.0 169.0 100 I/ Includes $7.2 million in duties and taxes.  - iii - Financing Plan ONEP Govt. FEC Bank Total --------------US$ Million--------------- ---------Local