Cameroon - Fifth Highway Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 3473-CM STAFF APPRAISAL REPORT UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT May 21, 1982 Western Africa Projects Department Highways Division 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 Currency Unit = CFA franc (CFAF) US$1 CFAF 270 CFAF 1 million = US$3,704 FISCAL YEAR July 1 - June 30 SYSTEM OF WEIGHTS AND MEASURES Metric Metric British/US Equivalents 1 meter (m) 3.28 feet (ft) I cubic meter (m3) 1.31 cubic yards (cu yd) 1 kilometer (km) 0.62 mile (mi) i square kilometer (km2) = 0.386 square mile (sq mi) I metric ton (ton) = 2,205 pounds (lb) ABBREVIATIONS AND ACRONYMS CAMAIR - Cameroon Airlines CAMSHIP - Cameroon Shipping Lines S.A. CAR - Central African Republic CIDA - Canadian International Development Agency DH - Department of Highways DHM - Division of Highway Maintenance DNW - Division of New Works DOT - Department of Transportation DSP - Division of Studies and Planning in MOT FAC - Fonds d'Aide et de Cooperation (France) Labogenie - National Civil Works Laboratory MINEQ - Ministry of Equipment MINEP - Ministry of Economic Affairs and Planning MINT - Ministry of Transportation MIHEU - Ministry of Housing and Urban Affairs NCEEP - National Civil Engineering Equipment Pool NPA - National Port Authority RPU - Road Planning Unit REGIFERCAM- National Railroad Company of Cameroon TPB - Training Production Brigade TPCU - Transport Planning and Coordination Unit URC - United Republic of Cameroon VOC - Vehicle Operating Costs VPD - Vehicles per Day  FOR OFFICIAL USE ONLY UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT STAFF APPRAISAL REPORT Table of Contents Page No. I. THE TRANSPORT SECTOR ....................................... 1 A. Background ............... ...... 0- ............ 1 B. The Transport System ..................2........ 2 C. Transport Priorities of the Fourth Development Plan 4 D. Transport Planning, Policy and Coordination .... ... 5 E. Sectoral Development ..6............. .... ........ 6 II. THE ROAD SUBSECTOR ....................................... 7 A. The Network ........................ . ................. 7 B. Road Transport Characteristics ..................... 9 C. Road Transport Industry ............................. 10 D. Administration and Planning ..... ..................... 11 E. Staffing and Training ......... ......... .......... . 14 F. Financing ............... 15 G. Engineering and Construction . . 16 H. Procurement .. 17 I. Construction Industry ... ............. . 17 J. Maintenance.. 18 K. Past Bank Group Assistance . . 18 III. THE PROJECT . . .19 A. Objectives.... 19 B. Description . . .. 19 C. Status of Detailed Engineering.. 22 D. Project Cost ....23 E. Financing ....25 F. Implementation ....27 G. Procurement ....28 H. Disbursements ....28 IV. ECONOMIC EVALUATION.. ... . .... ... ... 29 A. General... ... 29 B. Project Benefits and Beneficiaries ..30 C. Economic Analysis ...................... .......... 31 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.  Table of Contents (continued) Page No. V. AGREEMENTS REACHED AND RECOMMENDATION .......................... 33 TABLES ........................................................... 35 ANNEXES 1. Past Bank Group Assistance .................................. 48 2. Terms of Reference for Consulting Engineers to Evaluate the Condition of the Paved Road Network and to Design Road Reconstruction and Maintenance Programs .... ............... 50 3. Outline Terms of Reference and Qualifications of Experts for the Highway Department in the Ministry of Equipment ....... 56 4. Outline Terms of Reference for the Technical Assistance to the Ministry of Transport ............................., 58 5. Outline Terms of Reference and Qualifications of Experts for Labogenie, the National Civil Works Laboratory ............ 61 CHART - World Bank 22296 ........................................... 13 MAPS IBRD 15470 IBRD 15471 lR This report was prepared by Messrs. K. Ohbi (Economist), S. I. Majtenyi (Engineer) and P. Ludwig (Senior Engineer). It is based on the information provided by the Government and the consulting firm Gauff (Germany), and the findings of a highway appraisal mission to Cameroon in October/November 1980 consisting of Messrs. H. R. Young (Senior Engineer), P. Ostenc (Senior Engineer), S. I. Majtenyi and K. Ohbi. Post appraisal visits were made to Cameroon in March and June 1981.  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT STAFF APPRAISAL REPORT I. THE TRANSPORT SECTOR A. Background 1.01 Cameroon, roughly triangular in shape, covers about 475,000 km2 and ranks 20th in size among the continental African States. The country's diversified topography, numerous climatic zones, uneven distribution of population and economic activities, the predominance of Douala as the major industrial center and its common borders (about 4,450 km) with six countries are of particular importance to transport. Landlocked Chad to the northeast relies on Cameroon for its principal access to the sea while the Central African Republic to the east is finding it increasingly attractive to trans- port high value/low bulk goods via the shorter and quicker Cameroonian land links instead of the Bangui-Brazzaville-Pointe Noire route. 1.02 The annual growth rate of Cameroon s population (about 8.3 million) has accelerated from 1.8% in 1970 to 2.4% at present. However, the population density is low (about 17.5 per km2) and its distribution is highly uneven. Urban population is growing three to four times faster than the national population. Douala (about 600,000 inhabitants) is the major port and dominant commercial/industrial center followed by Yaounde (about 400,000 inhabitants), the administrative and political capital. Their combined population of about one million is more than doubling every decade and represents about 40% of the urban population living in towns of over 5,000 inhabitants. Other urban areas of note are Nkongsamba, Garoua, Maroua, Bamenda, Baffousam and Kumba. Because the population is unevenly distributed and the country has 18 major ethnic groups, the Government wants to develop the transportation system in general and the road network in particular, to help achieve national unity. As a result, the improvements in accessibility between rural and urban areas lead to: (i) an increasing demand for rural passenger transport because urban dwellers retain close ties with their villages; and (ii) a growth in freight transport to supply the cities with food. 1.03 GDP growth averaged 7.3% per annum during the first three years of the Fourth Plan (FYs 77-79) compared with the average 4.5% growth during Second (FYs 66-71) and the Third (FYs 72-76) Plan. GNP per capita has reached about US$560. Rapid expansion in agriculture, manufacturing and mining supported by increased consumption and investments contributed to the growth which is sustained by favorable prices for cocoa and coffee. This expansion reflects, in part, the Government priority to the development of agriculture (para. 1.17) which is expected to continue expanding. Forestry exploitation also is expected to increase in view of the new concessions opened at Deng Deng (near Belabo) and the favorable long term price projections for logs and sawn woods. An oil refinery is under construction at Port Limboh, near  - 2 - Victoria, and production is expected to start in late 1982. Current produc- tion of offshore oil (about 5 million tons per year) is expected to double during this decade. However, prospects for exploiting iron ore near Kribi and bauxite at Minim and Martap (southwest of the railroad terminal at Ngaoundere) are modest in the near future. Overall, the outlook for continued growth of the economy appears favorable. Further expansion in agriculture, forestry and mining will, however, be dependent, among other factors, on the maintenance, improvement and expansion of the transport system. B. The Transport System 1.04 The Cameroonian transport system is import-export oriented and focused on Douala, the major port, and the road-rail Trans-Cameroon route to Yaounde and the Chad border. The physical infrastructure consists of: (i) about 64,800 km of roads, of which nearly half of the kilometerage is unclassified, seasonal earth roads; (ii) 1,153 km of railway; (iii) the dominant port of Douala and the secondary ports of Victoria, Tiko, Kribi and the major private timber port at Campo; (iv) the seasonal port of Garoua on the Benoue river; and (v) the international airports at Douala and Garoua, the large domestic airport at Yaounde and a dozen smaller domestic airports. 1.05 Cotton from northern Cameroon is transported by road to Ngaoundere and thence by rail to Douala for export, a combined distance of some 1,500 km. Cocoa and coffee from the western highlands and the central mountains are carried by road or by rail about 200-300 km to Douala. Palm oil, rubber and tropical fruits are produced on the coast and require only a short haul to be exported. Total exports of logs and sawn wood exceeded 600,000 tons in 1979. Many of the logs exported through Douala are hauled by rail for an average distance of nearly 400 km. Roads 1.06 Details of the road sub-sector are given in Chapter II. Railways 1.07 The railway, whose main lines are the Trans-Cameroon line (Douala- Ngaoundere, 913 km) and the western line (Douala-Nkongsamba, 160 km), are operated by Regie Nationale des Chemins de Fer du Cameroon (REGIFERCAM), an autonomous state agency under the responsibility of the Ministry of Transport. The railway carries mostly timber, petroleum products, manufactured imports, cotton and cocoa. Freight increased steadily between FYs 73-79 at an average annual rate of 9% in ton-km and 4% in tons carried. In FY 79 freight traffic reached nearly 1.4 million tons over an average of 405 km, or about a half billion ton-km. The Trans-Cameroon line carried over 90% of the tonnage. Passenger traffic, however, declined steadily from over 1.7 million passengers in FY 73 to 1.4 million in FY 79.  -3- 1.08 Financially, REGIFERCAM is operating at a loss but steps are being taken to solve operational and managerial problems. External donors are financing the track realignment between Douala and Yaounde, the oldest and most heavily used section, as well as the purchase of locomotives and rolling stock. However, realignment of the last section of the track between Edea- Maloume (Eseka-Maloume) is still subject to its economic feasibility. The large investments involved would make debt servicing critical for the railway without giving it a competitive edge over road transport when the reconstruc- tion of the Douala-Yaounde road is completed in 1985. Consequently, the Government and the Bank agreed under the Fourth Railway Project that the Edea Maloume section would be realigned only if it was economically justified. Additionally, the Fourth Railway Project provides for measures to improve REGIFERCAM's operations, marketing, tariffs and finances as well as studies to review the pricing and regulatory environment of freight transport with the objective of attaining a competitive mechanism for the allocation and distribution of freight in the corridor. Ports, Shipping and Inland Waterways 1.09 Douala, the principal port, handles about 90% of Cameroon's foreign and transit trade. Between 1972-79, traffic grew at an average 8.5% annum, with imports growing at over 10% p.a. and exports at just over 3% p.a. In 1979, nearly half of the exports were logs and sawn wood, while about a quarter of all imports were petroleum products and 15% were clinkers. Over the last two years, the port's capacity has been more than doubled to about 6 million tons through a program of construction, re-equipment, training and reorganization of personnel. The substantially completed Second Douala Port Project (Loan 1321/Credit 657 CM, US$25.0 million, 1976) assisted in the reorganization and capacity expansion. 1.10 The secondary ports of Victoria and Tiko have been losing traffic to Douala. Annually, the two handle between 21,000 tons to 23,000 tons of exports; mainly palm products, cocoa, coffee and some bananas. The lighterage port of Kribi handles about 190,000 tons of exports mainly logs from nearby areas, and about 10,000 tons of imports. The small river port at Garoua on the Benoue is navigable to Nigeria from mid-July to mid-October. Its annual throughput of about 20,000 tons is evenly divided between exports (mainly cotton) and imports (mostly fertilizers). None of these ports provide a forseeable alternative to Douala. However, considering the long term con- straints to the physical and economic growth of Douala, the Government has initiated proposals to identify and evaluate a second deep water port. The Rocher de Loup site in the Kribi region (in the southeast) is presently favored. 1.11 The generally well managed National Port Authority (NPA), an autonomous public corporation under the responsibility of the Ministry of Transport, is in charge of operations for the ports of Douala, Kribi, Tiko, Victoria and Garoua. NPA is financially self supporting and in FY 79 it generated CFAF 1.7 billion (US$7.2 million) from operations.  - 4 - 1.12 Cameroon Shipping Lines S.A. (CAMSHIP), formed in 1975, has devel- oped fairly successfully. The Government, the National Investment Company, and Unimar, a West German shipping company, have equal shares in CAMSHIP. The fleets six ships total about 75,000 dead weight tons. Additionally, CAMSHIP has a chartered banana boat of 4,100 dead weight tons. CAMSHIP carried about 32% of the export tonnage (excluding banana and other fruit) and around 29% of the import tonnage (excluding liquid cargo) between Douala and Northern Europe in 1978. Regular operations to Western Mediterranean ports started in 1979. CAMSHIP had a small deficit in FY 79. 1.13 CAMSHIP receives favorable treatment from the Shippers Council of Cameroon which controls cargo allocations. Since its reorganization in 1978, the Council has substantial financial resources at its disposal. It receives 0.3% of the value (F.O.B.) of all trade and has started to use these funds to study the production, marketing and transport of major commodities. The first of such studies, on coffee, has been published. Air Transport 1.14 The air transport industry in Cameroon comprises Cameroon Airlines (CAMAIR) which operates scheduled passenger and cargo flights and charters, the Armed Forces and small companies that operate charters and carry freight. CAMAIR (formed in June 1971) is owned 75% by the Government and 25% by Air France with which it has reciprocal marketing arrangements. It operates domestic services (which are generally unprofitable) between Douala, Yaounde and 12 other domestic airports, and profitable international services between Douala, West and East Africa, and Europe. Its passenger fleet consists of a Boeing 747, one Boeing 707, three. Boeing 737s, and one de Havilland Twin-Otter. The cargo fleet is made up of one C107 (converted Boeing 707) and two leased C310 Hercules. 1.15 Douala, where the runway has recently been extended, is the prin- cipal international airport. Garoua, the secondary international airport, is not much used. The feasibility of an international airport at Yaounde is also being examined by the Government. Difficult terrain, high costs, problems of splitting traffic between Douala and Yaounde as well as operating schedules are among the hinderances to this new airport. Model Split of Traffic 1.16 On a country-wide basis, road transport dominates all other trans- port modes. Rail represents an alternative to road only in two corridors: (i) Douala and Bafoussam, where road transport is the dominant mode; and (ii) the Douala-Yaounde-Ngaoundere corridor where 75% of the through traffic is carried by rail. (Internal waterways and domestic aviation account for minor shares in domestic transport.) C. Transport Priorities of the Fourth Development Plan 1.17 Since four-fifths of the Cameroonian labor force is engaged in agriculture, the Government gives priority to its development. (The sector produces about 40% of the GNP and about 70% of export revenues.) However, as  large areas of the country are still isolated or are served by rudimentary infrastructure, the Fourth Development Plan recognized the need to develop secondary and feeder roads to provide access to the domestic markets for agricultural products. To improve transport for commodities such as cocoa, coffee and, increasingly, timber, significant investments have been made in ports, trunk roads and railways serving the major producing areas. Other transport-related goals of the Fourth Plan, which expired in June 1981, included the fostering of regional integration (para. 1.02) and developing international links (para. 1.01). 1.18 The overall investment program under the Fourth Plan (over US$900 million in 1978 prices) was excessive vis-a-vis the absorptive capacity of the transport sector. As a result, a number of projects in advanced planning stages have been deferred to the Fifth Plan. Among these are: the completion of the Douala-Edea-Yaounde Road, paving of the Bafoussam-Yaounde road, possibility of a second deep water port and realignment of the railroad between Eseka and Maloume (para. 1.08). 1.19 Traditionally, resource allocations to the transport sector have been influenced by the Government's regional development policy which is aimed at satisfying socio-political demands. Limited planning capabilities and lack of clear priorities on whether to pave the national roads or expand the secondary network have sometimes resulted in poor investment decisions. The Government's limited transport planning and management capabilities are also responsible for the weak project designs and delays in their execution. Recent Government actions and Bank assistance aimed at improving transport planning are reviewed below. D. Transport Planning, Policy and Coordination 1.20 The Ministry of Transport (MINT) is legally charged with non-urban transport planning. It was created in 1970 following Bank recommendations and was reorganized in 1976. Its responsibilities include sector management and policy coordination. MINT needs strengthening in order to do its job properly; especially to plan and coordinate inter modal investments. 1.21 MINT's major obligations are: (i) to review, coordinate and screen transport investment proposals prepared by other ministries and public agen- cies under its supervision; (ii) to formulate sector management and opera- tional policies and guidelines; and (iii) to review, regulate and authorize tariff structures and rates for REGIFERCAM, NPA and CAMAIR. With only about ten professional staff who have limited experience and inadequate exposure to transport planning, MINT is weak and unable to effectively coordinate invest- ments in the sector (para. 1.08). An economist, financed under the Third Highway Project helped MINT conduct a comprehensive origin destination survey. Another economist, financed under the Technical Assistance Project, advised MINT's Transport Planning and Coordination Unit (TPCU) on general planning,  - 6 - policy and coordination matters. Past technical assistance to MINT did not fully achieve its objectives because there were no suitable counterparts. Nevertheless continued assistance to MINT is indispensable because no other agency is strong enough to take over all of MINT's functions without over burdening itself. The Government has assured the Bank that it will appoint qualified counterparts and has begun to recruit them. The proposed project would therefore continue past technical assistance and expand its scope (para. 3.12). 1.22 The Ministry of Economic Affairs and Planning (MINEP) one of the better organized and staffed ministries, has done some transport planning in the context of development planning. However, it lacks the technical expertise needed to evaluate the increasingly sophisticated investment deci- sions which now need to be made in the transport sector. Therefore, to help MINEP formulate the transport component of the Fifth Development Plan (para. 1.18) an economist/planner was financed under the Technical Assistance project to help coordinate transport sector allocations with investments in the demand-generating agriculture and forestry sectors. This was necessary because MINT lacked the capacity in this field which will be developed under the proposed project. 1.23 The Road Planning Unit (RPU) in MINEQ has now become operational and started to plan highway investments and prioritize major road maintenance activities. RPU is headed by an able transport economist and supported by a full time statistician. An economist financed under the Fourth Highway Project is helping RPU make a start in undertaking feasibility studies. 1.24 MIHEU, created in 1979, is responsible for urban transport planning. This ministry has just begun to acquire appropriate personnel and is not expected to become active in urban transport planning before late 1982. In view of the rapid rate of urbanization in Cameroon this ministry is expected to assume a key planning role in the coming decades. E. Sectoral Development 1.25 The Bank and the Government are engaged in a dialogue on the need to strengthen transport sector management. The Government was quite responsive to the need for planning but initial attempts to reinforce the organization and administrative machinery for planning and policy-making met with limited success. Recent developments indicate a more positive attitude. Government 4 reorganization in late 1979 removed housing from MINEQ's control which will enable it to concentrate on the evolving needs of the road network. MINT plans to enlarge the scope of TPCU and upgrade it to the Division of Studies and Planning (DSP). The proposed staffing (about 5 professionals and needed support personnel) is adequate. 1.26 The Government planning effort to date has been based on a project- by-project approach which was adequate when the transport investment alterna- tives were clear cut. Now, however, more sophistication and rational procedures  - 7 - for sectoral allocations are needed because increasingly complex investment choices must be made to sustain Cameroon's generally healthy economic growth. The evolution of a systematic, long-term plan has also been hampered by scarce technical expertise. Concerned by these shortcomings, the Government has requested Bank financing for a national transport survey (para. 3.09 ) to provide it with a longer-term perspective of the sector's needs. DSP, with technical assistance provided under the proposed project (para. 3.12) will supervise the consultants who will carry out the transport survey. The survey is expected to form the basis for the transport component of the next develop- ment plan and influence the actual investments made in the sector in the last two years of the Fifth Development Plan. 1.27 The Bank's sectoral objectives continue to be two-fold: (i) to develop the Government's transport planning capacity; and (ii) to strengthen the management of the transport sector, particularly the efficient utilization of existing infrastructure, coordination of transport modes, and improved project implementation and monitoring. The proposed project will assist the Government in meeting these objectives through technical assistance to DSP and provision for a transport survey which will provide the Government with a blue print of long term sector investments based on sound technical and economic principles and a ranking of investment priorities. While technical assistance under the Fourth Highway Project is helping RPU plan the construction and maintenance of the network, assistance under the proposed project will help MINEQ implement and monitor effectively the construction of the Edea-Yaounde section of the Douala-Yaounde road (paras. 3.08, 3.10 and 3.11). II. THE ROAD SUBSECTOR A. The Network 2.01 Cameroon, with about 65,000 km of roads, has an extensive network judging from the 0.14 km per km2 road density which compares favorably with neighboring countries. 1/ However, paved roads account for but 4% of the total network and are concentrated around Douala, Yaounde and Garoua where the network is most developed. 2/ Elsewhere, large parts of the country are still isolated or served by the most rudimentary infrastructure (para. 1.17). Beside the paved roads, all weather accessibility on the classified network, which totals about 32,800 km, is possible to some extent on the engineered national gravel roads. The rest of the classified network provides mainly dry season access. The unclassified network consists mainly of non-engineered seasonal tracks which are generally in poor condition and serve limited traffic. The evolution of the network is shown below using the functional classification system adopted in March 1979: 1/ Nigeria = 0.16 km/km2, Chad = 0.02 km/km2, Gabon = 0.02 km/km2, Congo = 0.03 km/km2 and CAR = 0.04 km/km2. 2/ The density of paved roads is four times less in Cameroon (0.005 km/km2) than in Nigeria (0.02 km/km2).  -8- % Average 1972 1976 1980 Annual Growth (km) (km) (km) 1972-1980 Classified Network - Paved Roads 1,400 2,000 2,400 7.0 - Gravel and Earth Roads 19,500 24,300 30,400 5.7 National 1,000 2,000 4,200 19.6 Provincial 2,300 2,800 5,900 12.5 Departmental 2,200 5,700 6,100 13.6 Rural 14,000 14,800 14,200 - - Total 20,900 26,300 32,800 5.8 Unclassified Network - Earth Tracks 22,000 28,000 32,000 4.8 GRAND TOTAL 42,900 54,300 64,800 5.3 Source: Ministry of Equipment, November 1980. 2.02 Overall, the classified network's annual growth rate of about 6% since 1972 reflects the Government's priority for developing the road sub- sector (paras. 1.02 and 1.17) and the economic development trends in the country. The paved network has grown at a slightly faster annual rate (7%) during the same period. Inasmuch as the development of traffic on individual links has resulted in their class redesignations from time to time, the growth rates for specific classes do not necessarily reflect trends in new construction. The Division of Highway Maintenance (DHM) uses the classifica- tion for budgeting road maintenance expenditures which in recent years have been adequate (para. 2.35). 2.03 The condition of the network varies from good to poor. The three dominant economic regions (northern, central and western) are connected by partly paved roads which frequently become impassable during the rains. Con- sequently, Yaounde in the central region is isolated sometimes simultaneously from the agriculturally rich western highlands and from the port of Douala, especially when the railroad is also closed. Edea, approximately half way between the two cities, is an important industrial center and generates most of the country's electric power. Its economy depends on reliable access to Yaounde and Douala. The existing paved road between Douala and Edea (92 km) is in an advanced stage of deterioration and unmaintainable in its present condition. Construction of this section on a substantially shorter alignment started in 1980. The construction of the Edea-Yaounde section is therefore one of the Government's highest priorities and forms part of the proposed project.  - 9 - B. Road Transport Characteristics Vehicle Fleet 2.04 Estimates of the size and composition of the vehicle fleet are shown in Table 2.1. The fleet is estimated at about 83,000 vehicles (excluding two wheelers). As MINT keeps no reliable data on the scrappage or retirements from service, the estimates of fleet size are open to a margin of error. The trend in registrations, however, reflects generally, the increasing level of economic activity in the country. Overall, annual registrations increased from under 2,000 in 1960 to about 16,000 in 1978. The average annual growth over the last 18 years has been around 13%. High growth for vans and trucks and the growth in diesel fuel consumption reflects demand for freight trans- portation. About 59% of the fleet consists of passenger cars and is located mostly in the urban areas. Vans account for about 18% of the fleet while the rest (23%) consists of heavy vehicles. Fuel Consumption by Road Users 2.05 Fuel consumption grew from about a quarter million cu.m. to over half a million cu.m. between 1973-79 (Table 2.2). During the same period, use of diesel fuel grew more rapidly than gasoline with the respective growth rates being 12% and 8% per year. The increase in diesel consumption conforms with the increased truck registrations and freight transportation. The rela- tively lower increase in gasoline consumption is attributed to the increasing numbers of motorcycles (excluded from fleet estimates) and the more energy efficient automobiles in the fleet. As most of the gasoline and diesel is consumed by road vehicles, the 8% to 12% order of magnitude of annual growth is in line with the growth of the vehicle fleet and the demand for road transport. 2.06 The evolution of retail fuel prices in Douala is shown in Table 2.3. The average price (Table 2.4) of gasoline is over US$2.0 per gallon, depending on the grade and additional transport distance from Douala. Diesel retails upwards of US$1.60 per gallon, again depending on the location and distance from Douala. 2.07 Cameroon imports all of its refined fuel products but domestic pro- duction is expected to come on stream about 1982. Therefore, the opportunity costs of producing gasoline and diesel have been considered as their C.I.F. values at Douala. A comparison of these with the domestic retail prices (net of taxes, Table 2.5) shows that consumers pay significantly more than the opportunity cost of either gasoline or diesel. Overall, the C.I.F. value of gasoline represents 36% and diesel about 43% of the retail price. Import duties account for about 22% and 14%. A fuel price stabilization levy repre- sents about 25% of the retail price while another fifth of the retail price goes to agricultural stabilization funds. The combined effect of the various taxes on gasoline and diesel is estimated to have generated over US$70 million toward road user taxes in 1979.  - 10 - Traffic 2.08 Since 1966, the Maintenance Division of the Department of Highways (DH) has conducted traffic counts for one week, every quarter, over the network maintained by DH. The national, principal provincial and departmental roads are covered and give a fair indication of the historic traffic volumes, composition and growth on specific links. As no systematic analyses of the available data exists, traffic growth rates are better estimated indirectly through trends in the growth of the national fleet, fuel consumption and growth of freight transport. These are estimated to be between 10% to 12% per year; about twice the average rate of growth of GDP during the last decade. However, paved roads, linking significant population and economic centers, have historically experienced higher growth rates which is confirmed by experience on past Bank projects. 2.09 The last country-wide road traffic survey was produced by con- sultants in 1967. MINT completed the most recent survey based on a two day count in July 1978. The results of the countrywide origin-destination survey financed under the Third Highway Project are available since March 1982 and are being analyzed. Additionally, for specific projects, consultants under- take volume counts and origin-destination surveys as a routine part of feasi- bility studies. Overall, paved roads (about 4% of the network) carry about 45-50% of the non-urban traffic while unclassified roads (about 50% of the network) carry only about 10% of the nonurban traffic. Of over one billion non-urban vehicle-km travelled in 1979, about 90% were on the classified network, the maintenance of which is the responsibility of DH. C. Road Transport Industry Regulations 2.10 The industry is subject to a minimum of regulations and entry is virtually unrestricted. MINT issues operating and trade licenses. Vehicle weights and Limensions follow the revised Highway Code of September 1979 which restricts loads to: (i) 10 tons on a single axle; (ii) 17 tons on a double axle; (iii) 16 tons on two axles; and (iv) 35 tons for tractor trailers. From the point of view of maintenance, the revised axle loads represent an improve- ment on the former limits of 13 and 19 tons on single and double axles respec- tively. Vehicles are limited to a maximum of 2.5 m width and 4 m height. Maximum length varies with the chassis configuration: (i) 11 m for single chassis trucks; (ii) 15 m for articulated trucks; and (iii) 18 m for tractor. trailers. These vehicle weights and dimensions apply only to new vehicles. Operations and Organization 2.11 The road transport industry is competitive and characterized by small firms owning one or a few trucks. Although it suffers from financial instability, it provides basic services and is growing in line with domestic demand.  - 11 - 2.12 Most freight requiring special handling is transported by either the larger trading houses hauling on own account or specialized firms. Para- statals such as SODE-COTON mainly haul on own account and operate sizable fleets. Timber and petroleum are generally transported by the concessionaires although specialized domestic firms have entered the market. International freight to Chad and CAR is handled by domestic and foreign firms. Cameroon's bilateral quota for Chad is handled through affiliates of SOGETRANS. The CAR traffic is less attractive to Cameroonian haulers because the road between the border and Bangui (500 km) is poor. 2.13 MINT authorized tariffs are generally low and do not reflect dis- tance or surface conditions. Consequently, truck and bus services tend to be concentrated between localities served by good roads. However, the low tariffs discourage the full development of trucking services even on paved roads because the owner/operators barely recover running costs from the official tariffs. Poor management among owner/operators, low tariffs and keen competition, explain the high rate of bankruptcies in the industry. On paved roads, low tariffs encourage overloading among the owner/operators which would be better controlled through action to be taken during the ongoing Fourth Highway Project which provides for the installation and operation of permanent weighing stations at strategic locations on paved roads. DSP, with technical assistance by consultants, will examine the issues in the industry and the structure and mechanism for pricing of transport during the transport survey to be carried out under the project. 2.14 There are three truckers consortia, one each in the southern, central and northern parts of the country. The northern consortium, SOGETRANS, based in Ngaoundere is the most active. It controls Cameroon's share of international traffic to Chad. Its members haul about half of the freight to and from the Northern province and trans-shipments at Ngaoundere are allocated between its members. 2.15 Non-urban passenger transport is controlled by another consortium with offices in major cities. It regulates schedules, issues tickets, runs several bus stations and lobbies on behalf of members. MINT, in addition to setting tariffs, allocates seating capacity and licenses mechanically safe vehicles for passenger transport. Tariffs are generally adhered to but accompanied baggage charges are unregulated and negotiable. An estimated 10% of passengers are carried in unlicensed private carriers but the practice is generally confined to remote areas. D. Administration and Planning Ministry of Transportation (MINT) 2.16 MINT's Department of Transportation (DOT) is responsible for, inter alia, vehicle registrations and inspections, issuing drivers permits, estab- lishing criteria for road safety, preparing road transport legislation, studying road transport costs and authorizing tariffs. Major shortcomings  - 12 - in the Ministry include a lack of clear perspective on the evolution of public transport and the development of the road transport industry through appropriate guidance, incentives or legislation. The task is made difficult because of poor record-keeping and operational inefficiencies. Although progress is now being made (para. 1.25) the Government has been slow in strengthening the planning capacity of the Ministry which is a gradual and long-term task. Ministry of Equipment (MINEQ) 2.17 MINEQ's main responsibility is the highway sector with minor involve- ment in technical education, and auxiliary services such as the National Civil Engineering Equipment Pool (NCEEP) and Labogenie, the civil works laboratory (see Organization Chart on following page). MINEQ's Department of Highway (DH) plans, constructs and maintains the classified road network and those feeder roads which are constructed and maintained under international agreements.. DH has a central office in Yaounde and nine provincial offices and forty two subdivisions. DH has a de facto Central Feeder Road Unit which coordinates the activities of different groups (local authorities, various Government Agencies, autonomous cooperatives and private companies) involved in building and maintaining the rest of the unclassified road network. The organization of MINEQ could be improved by giving more authority and resources to the divisions. The main weakness of MINEQ, however, is the lack of experienced senior level management. 2.18 The NCEEP is an autonomous agency under a nominal control of MINEQ. NCEEP rents heavy equipment to Government and private organizations and in particular to the Division of Highway Maintenance (DHM). Recently the Govern- ment appointed a Project Coordinator who, among his other duties, will liaise between DHM and NCEEP because the existing relationship between the two institutions is unsatisfactory. DH and NCEEP operational priorities should coincide sufficiently to achieve the longer-term objective of encouraging more efficient utilization of existing infrastructure. The national trans- port survey under the proposed project would study ways and means to ensure managerial and operational improvements and recommend appropriate procedures to the Government for their implementation. In the interim, the Government has confirmed that NCEEP would seek DH clearance before renting equipment to organizations other than MINEQ.  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT ORGANIZATION OF THE MINISTRY OF EQUIPMENT _ - _ _ _ _ _ mm _ _ _ _ _ _ _ _MINISTER OF EQUIPMENT I F m m ~~~~~~ m m G E N E R A~~~~RL SERTY NATIONAL CIVIL IVIL ~~~~~~~~~~~~~~~~~NATIONAL COLLEGE TRAINING SRE TRUSTEESHIP ENGINEERING LABOGENIE OF TECHNOLOGY DIVISION SCUHOOL EQUIPMENT POOL HIGHWVAYS GENERAL DEPARTMENTS DEPARTMENT ADMINISTRATION 7PLANNING DIVISION DIVISION TECHNICAL UNIT OFNEWWORKS OF HIGHWAY MAINTENANCE ADVISORS RIDGE STUDIES CE1NTRAL ROAD STUDS ANDCOSTRUCTION EUPNTAD SERISION FEEDER ROAD AND CONSTRUCTO OFFCEFROGAM OFFICE UNITICE PROVINCIAL OFFICES FAR CENTER SOUTH LITTORAL ORT ~~~~~~~~~~~~~~~~~~~~~~SOUTH WS BMAROUA O;GAROUA BAMENDA BAFOUSSAM YAOUNDE BERTOUA EBOLOWA LVICTORIA IDOUALA KOUSSERI NGAOUNDERE KUMBO DSCHANG BAFIA ABONG-MBANG KRIBI KUMBA BNKONGSAMBA SUBDIVISIONS MOKOLO IBATI NKAMBE BAFANG MONATELE BATOURI BSANGMELIMA HMAMFE WYABASSI YAGOUA FMEIGANGA WMBENGWI BANGANGTE SNANGA-EBOKO P YOKADOUMA EDEA TCHOLLIRE WUM FOUMBAN IAKONOLINGA NGUELEMENDOUKA MBOUDA MBALMAYO MESEKA SOtURCE: MINISTRY OF EQUIPMENT World Bank -22296  - 14 - 2.19 Labogenie, the National Civil Works Laboratory, is also an autono- mous agency under the nominal control of MINEQ. It is supervised by a com-- mittee representing eight Government organizations and ministries. Day-to--day operations are managed by the laboratory's director. The laboratory performs field tests for civil works and has four divisions: (i) roads; (ii) soils and foundations; (iii) materials, and (iv) explorations, to carry out the specific tasks. Most of the laboratory's equipment is worn out and needs to be replaced. It has no room for expansion at its current location and needs additional storage, testing and office space to handle an increasing volume of work. The laboratory has ambitious plans to develop satellites in all important cities of the country. Due to numerous constraints, this last objective calnot be met in the near future. The project will assist the laboratory in the first step in its development program (para. 3.13). E. Staffing and Training 2.20 DH has about 2,000 permanent employees, including about 30 engineers (graduated from foreign colleges and universities), 124 technicians, 127 foremen, 290 mechanics, 226 operators and 264 drivers. The rest are mostly clerks and laborers. DH is short of experienced managers, supervisors and professionals. To partially alleviate this problem, FAC (France) provides three technical assistance experts to assist DH's headquarters staff. Addi- tionally, the proposed project will provide three more experts to strengthen DH's project-related administrative capacity (para. 3.11). However, the shortage of Cameroonian professionals is likely to continue until MINEQ can attract and retain more engineers (para. 2.23). 2.21 NCEEP has about 530 permanent employees, including 16 professionals, 200 mechanics, 120 operators and drivers. NCEEP attracts better qualified personnel than DH partially because NCEEP's salaries are higher than those of DH and partially because management has been able to motivate staff. Of the nine expatriates provided by FAC, six continue to assist NCEEP in its workshop operations while three assist it with the training of operators and mechanics. Additional assistance is provided under the Fourth Highway Project. 2.22 Labogenie's staff (8 engineers, 4 geologists, and 31 technical assistants) is insufficient to handle the rapidly increasing volume of work. The director is capable but some of the engineers and most of the technicians need training in laboratory and field exploratory techniques. The proposed project will assist Labogenie in this effort (para. 3.13). 2.23 Cameroon has been developing facilities to meet the large training needs. About 20 civil engineers graduate each year from the National Superior Polytechnical College. The National College of Technology (ENAT) and the Survey School at Buea also graduate about 120 mid- and upper-level techni- cians who are required to work for the Government for a minimum of ten years. MINEQ's Training Division is developing courses to upgrade mid-level employees to assume positions of greater responsibility. NCEEP operates two training  - 15 - centers: (i) the Training Center for Mechanics in Douala which has an annual capacity of about 30 mechanics; and (ii) the Training Center for Operators in Yaounde which has an annual capacity of about 40 operators. Training for road maintenance operations is being provided under the ongoing Fourth Highway Project and the Federal Republic of Germany (para. 2.36). In addition, a total of 32 man-years of training will be provided under the Fifth Highway Project through Bank financing of fellowships to DH and Labogenie Staff (paras. 3.11 and 3.13). F. Financing Road Construction Investments 2.24 Table 2.6 shows the sources of finance available to the central Government for road construction during FYs 72-78. Approximately half the funds came from foreign sources, mainly in the form of loans. The investment budget accounted for about a third of the expenditures while the remainder was financed from outside the budget. Not included in these figures are road construction outlays by local governments (probably an additional 10%) and by public and private enterprises, on which data is incomplete. 2.25 During the Third Development Plan Period (FYs 72-76) Central Govern- ment expenditure on road construction was about CFAF 36 billion (US$153 mil- lion) in 1976 prices or CFAF 43 billion (US$183 million) in 1978 prices (equivalent to about US$205 million in 1981 prices). Outlays fluctuated widely and increased substantially for the last two years of the Third Plan, i.e., 1975 and 1976, when annual outlays reached about CFAF 13 billion in 1978 prices. 2.26 The Fourth Development Plan (FYs 77-81) set a road investment target of CFAF 94 billion (US$400 million) expressed in 1978 prices, or 43% of the overall transport investments. This target was nearly double the estimated road investments during the Third Plan. The plan assumed that foreign sources of finance would cover 52% of total outlays, a similar proportion to that during the Third Plan period. However, due to shortages of foreign finance, domestic budget constraints and the completion of a number of major projects, the level of investment fell off during the first two years to CFAF 11 billion in FY 77 and CFAF 6 billion in FY 78. Data are incomplete on Government investments in FYs79-81 but MINEP's estimates indicate that as of June 1981 only about 25% of the planned investments in roads were realized (para. 1.18); partly because the Government's investment targets tend to be indicative. With the development of RPU, future investment targets are expected to be based on rational and firmer project priorities. Road Maintenance Expenditures 2.27 Road maintenance costs, financed under the recurrent budget, re- mained approximately constant in real terms during the Third Plan Period at about CFAF 3.0 billion (US$11 million) p.a. During that period the classified network maintained by the Government increased substantially, and the allowance  - 16 - per kilometer for road maintenance actually decreased by about 30% in real terms. The percentage of total road expenditures allocated to road mainte-- nance also decreased from about 40% to 20% between FYs 72-76. The Government has, however, begun to take steps to reverse this process as required by a covenant under the Fourth Highway Project and adequate funds (over CFAF 200,000/km) are now being allocated. Road User Charges 2.28 Road user charges are quite high and the annual tax on vehicles has recently been doubled. Taxes and custom duties on new vehicles (70% to 80% on private cars and 50% to 65% on other vehicles), spare parts and tires (50% to 60%) are the main source of revenue. Annual tax on private cars varies with engine size up to a maximum of CFAF 30,000 but is only paid for vehicles less than four years old. The tax on vans, buses and trucks is CFAF 30,000, provided the vehicle is not more than six years old. The other major source of revenue is tax on fuel which in October 1979 averaged about CFAF 52/litre for gasoline and CFAF 36/litre for diesel. 2.29 During the Third Development Plan, revenues from the highway sector were estimated at CFAF 74 billion (Table 2.7) in 1976 prices. During the same period, expenditures on construction (CFAF 36 billion in 1976 prices) and maintenance (CFAF 15 billion) totalled CFAF 51 billion or about 70% of revenue. During FYs 77-78, outlays on road construction (about CFAF 19.9 billion) and maintenance (about CFAF 6.1 billion) are estimated at about CFAF 26 billion compared with the road revenues of about CFAF 44.5 billion, indicating that aggregate road revenues are more than adequate. G. Engineering and Construction 2.30 Cameroon's variety of climatic, topographic and geotechnical condi- tions influence road design, construction and maintenance. The topography is flat in the western coastal areas, rolling in the north and east and mountainous in the central and north-western parts of the country. Construc- tion materials are generally poor: laterites have a high plasticity and the abrasion characteristics of crushed stone are often around the limit of acceptability. The coastal area is swampy and subject to intensive precipita- tion. The northern part of the country is savannah with precipitation being a small fraction of that in the coastal areas. In the coastal and central areas, construction and maintenance activities are limited by the six-month rainy season but are less restricted in the north. General geological and hydrological information is available from earlier surveys, but data at spe- cific locations may not be available which may make it difficult to estimat,e peak stream and river flows. 2.31 The Division of New Works (DNW) within DH is responsible for the design and construction of roads. The DNW employs consultants for major design works and supervision of construction. As DNW does not have its own specifications and standards for geometric, pavement and structural designs, it relies on French specifications which are adapted by consultants for specific  - 17 - projects. Pavements sometimes are designed and/or constructed to standards which are too low; possible reasons include: (i) underestimation of traffic; (ii) poor quality control during construction; and (iii) materials specifica- tions which may not be met economically. The design for the proposed project takes account of these factors. H. Procurement 2.32 Contracts for major civil work projects are awarded on the basis of prequalification and competitive bidding by contractors and in the case of works financed by international agencies, subject to procurement guidelines of the agency involved. Contractors registered in Cameroon are classified according to their capacity and are allowed to bid only on works consistent with their capacity. The DNW prepares the prequalification and bidding documents and the Central Tender Board (Commission Centrale des Marches) is in charge of prequalification and calling for and evaluating bids. In excep- tional cases, the Central Tender Board may decide to negotiate a contract with a single consulting firm or a contractor. The DNW is represented at Board meetings. Contracts for major consultancy services have also begun to be awarded following prequalification and competitive bidding by consulting firms. The Central Tender Board does not have enough personnel or streamlined procedures to handle its increasing scope of responsibilities. This situation combined with a rigid interpretation of guidelines, sometimes cause delays in procurement. I. Construction Industry 2.33 The major contractors are foreign firms. About 350 local firms are engaged in building construction and now, some of them are bidding on small road construction contracts. Most of the domestic firms are in the small-to- medium capacity range and include one large domestic firm (Nanga et Cie); they have no experience in executing large paved road construction projects. During preparation of the Fourth Highway Project, a consultant financed by the Bank reviewed the status of the domestic contractors and recommended an action program to upgrade the domestic construction industry. Consultants have been engaged to assist the Government on these recommendations. Domestic contrac- tors can obtain credit for equipment procurement under favorable terms and numerous training opportunities are available to them. The Government awards small culvert and laterite road construction as well as paved road resealing contracts to domestic contractors. In coming years, the domestic construction industry is expected to participate in urban street construction, water supply extension, and sewerage works in addition to building construction. The Bank approved two projects to help the small and medium capacity firms. The first, US$3.0 million to the Cameroon Development Bank for the "Small and Medium Scale Enterprise Project" (Cr. 575-CM) was implemented between 1975-81. The second, approved in November 1980, is a follow-up project which provides a US$15.0 million line of credit to the Cameroon Development Bank and the National Assistance Center of Small and Medium Enterprises.  - 18 - J. Maintenance 2.34 The DHM within DH is responsible for maintaining all classified and some unclassified roads. The present road maintenance organization dates from 1968 when the Government created NCEEP from the existing DH road equipment and repair facilities with additional new road maintenance equipment provided by FAC. At that time, FAC also reinforced DH and NCEEP staffs by adding several technical assistance experts, and the Government adequately funded road main- tenance operations. The situation deteriorated, however, when FAC began to phase out technical assistance, the length of the road network increased, budget allocations for road maintenance per unit length decreased in real terms and, as a consequence, NCEEP had no funds to renew its road maintenance equipment. Under the Fourth Highway Project, a major effort is being made to upgrade road maintenance, replace worn out equipment and train equipment operators, mechanics and foremen. After initial difficulties, includiing delays in appointing consultants project implementation started in late 1980. 2.35 The road maintenance budget, which is now adequate, has been in- creased substantially and will permit a rational evaluation of needs and the allocation of funds. The maintenance budget grew as follows during the past eight years: Highway Maintenance (in current CFAF millions) Fiscal Year 1972 1976 1980 1981 Maintenance 1,910 3,170 6,449 7,120 2.36 The unclassified feeder roads network is still the responsibility of various Government agencies and local authorities, but DH's Central Feeder Roads Unit coordinates their activities. As a step in the new maintenance effort, the Federal Republic of Germany has started a project to assist in maintaining and repairing the paved Figuil-Maroua-Maltam road (300 km). This work is being expanded under the Fourth Highway Project. K. Past Bank Group Assistance 2.37. The first three Bank highway projects concentrated on the construc- tion of trunk roads while the fourth was directed at strengthening the road maintenance capacity. The Bank has also financed feeder roads construction in line with the evolving needs of the country. Seven projects have been or are being implemented in the sub-sector; a summary of these projects is provided in Annex I.  - 19 - III. THE PROJECT A. Objectives 3.01 The objectives of the proposed project are to assist the Government in reconstructing a section of the economically important Douala-Edea-Yaounde road, to improve the Government's capacity for road rehabilitation and trans- portation planning and coordination, and to lay the foundation of a maintenance and rehabilitation program for the country's paved road network. B. Description 3.02 To achieve these objectives, the project consists of: (i) civil works: (a) construction of the Edea-Yaounde section (181 km) of the Douala-Yaounde Road; and (b) construction of new buildings for Labogenie. (ii) consultant services: (a) to supervise construction of the Edea - Yaounde road; (b) to prepare a national transport survey; and (c) to evaluate the existing paved road network. (iii) technical assistance to strengthen: (a) the Highway Department in the Ministry of Equipment; (b) the Planning Department in the Ministry of Transportation; and (c) the National Civil Works Laboratory (Labogenie). Road Construction 3.03 Reconstruction of the Douala-Yaounde Road has the highest priority in the Government's current investment program. Detailed engineering of the road was started in 1977 under the Fourth Development Plan when the Government engaged consultants Gauff (Germany) to carry out the engineering for a four lane divided highway. However, the expected traffic volume did not justify theser high standards at this time, and the Government, in consultation with  - 20 - the Bank, instructed the consultants to change the design to a two lane paved road, with the option of adding two further lanes at a later stage. The Bank financed the revised study under the Fourth Highway Project. At a co-donors' meeting held in Brussels in May 1980, the Government used the revised study, which was submitted by the consultants in early 1980, to obtain financing commitments for the entire road. 3.04 For technical and financing purposes, the Government divided the Douala-Yaounde Road into two sections: Douala-Edea (65 km) and Edea-Yaounde (181 km). Section I from Douala to Edea comprises lots 1 to 5. Since Lot 1 (3 km) is still within the urban area of Douala it was not included in the calculation of the cost and the economic justification of the Douala-Yaounde Road. During negotiations the Government agreed to award all contracts for the construction of Section I by December 31, 1982. For most of the lots construction is underway. 3.05 Section II from Edea to Yaounde comprises lots 6 to 9 which are financed by six different agencies. The Kuwait Fund, the Islamic Bank and the Abu Dhabi Fund, finance construction of lot 6 (41 km). The Bank finances construction of lot 7 (65 km). The Kingdom of the Netherlands and private sources in the Netherlands signed a loan agreement with the Government in June 1981 after which a contract was awarded to a Dutch joint venture for the construction of lot 8 (62 km), also in June 1981. Construction on this lot has started. Finally, the Government of Canada has signed an agreement to finance the construction of lot 9 (13 km). During negotiations the Government agreed to inform the Bank of any proposed modification of design standards or extensions of construction deadlines for any lot of the Douala-Yaounde Road. 3.06 The existing laterite-surfaced road between Edea and Yaounde follows a poor alignment and is frequently closed to traffic during the rainy season. Even in the dry season, the road is in poor condition and is difficult to maintain given the heavy traffic which calls for a paved surface. The new road is located mainly on a new alignment through lightly inhabited country. It is about 6 km shorter than the existing road. From Edea, the alignment is in flat terrain gradually increasing to hilly in lot 6 and becomes mountainous towards the east end of lot 7 and through much of lot 8. Lot 9 is in rolling terrain and comprises a connector leading into Yaounde and a bypass around the city. Construction of lot 7 will follow in its entirety a new alignment. There are three small bridges on this lot. The proposed design standards (Table 3.1) are consistent with the standards used for the Douala-Edea Road and other paved roads in Cameroon, and are appropriate for the forecast traffic. They are based on a design speed of 80 km/h and a maximum gradient of normally 6% which exceptionally may be as high as 8.5%. The pavement will consist of a crushed stone sub-base, an asphalt bound crushed stone base, and a surface of bituminous concrete. The pavement will be 7.40 m wide with 2 m shoulders.  - 21 - Building Construction 3.07 A new building is needed to expand Labogenie's headquarters in Yaounde as the existing facility is too small to ensure that equipment is housed properly. The site for the new building has been expropriated and plans are being prepared. In Douala, the existing laboratory needs an extension for which the plans have been completed. Procurement of laboratory equipment will be subject to the substantial completion of the new buildings. Consultant Services 3.08 Construction Supervision. To permit better coordination during the construction of Section II, the Government with the consent of the co- donors, has requested the Bank to finance the supervision of construction of all the lots in the Section (lots 6-9). During negotiations, the Government agreed that consultants will be employed to supervise construction of lots 6-9 during the entire construction period. Whereas supervising consultants have been engaged for lot 8, the appointment of consultants for lots 6, 7 and 9 constitute a condition of loan effectiveness. 3.09 Transportation Survey. The terms of reference prepared by the Ministry of Transport for a national transportation survey have been agreed by the Bank and the Government is seeking a firm of consultants to provide these services. The survey will be carried out by consultants under the responsibility of the Division of Studies and Planning (DSP) within MINT and in close cooperation with the MINEQ (RPU). Its objective is to provide a long-term perspective on the sector and rational criteria for sector policy formulation and implementation. The project will finance the survey which is estimated to require about nine staff-years of consultants services. During negotiations the Government agreed to employ consultants under terms and conditions acceptable to the Bank and to exchange views with the Bank on the results of the survey. 3.10 Evaluation of the Paved Road Network. The Fourth Highway Project addressed the maintenance of the laterite roads and only the routine mainte- nance of the paved roads. The expanding network and the increasing traffic on the paved roads now necessitate the development of a maintenance policy for these roads. The proposed project will provide 12 staff-years of consulting services to measure typical axle loads and to evaluate the level and composi- tion of traffic and the condition of the paved road network by laboratory testing of sample cores and pavement deflection measurements. The study will recommend an optimum maintenance strategy for periodic maintenance, define the useful life of these roads and determine when and to what standards they should be rehabilitated or reconstructed. The study will be carried out in close cooperation with Labogenie so as to establish within Labogenie the capacity to perform pavement evaluation on a continuing basis. During nego- tiations, the terms of reference (Annex 2) were agreed upon with the Govern- ment, which also agreed that consultants will be employed under terms and conditions acceptable to the Bank.  - 22 - Technical Assistance 3.11 Highway Department. To alleviate the problem of staff shortages (para. 2.20) and to facilitate the processing of contracts and the supervi- sion of consultants and contractors, the project provides a team of three engineers for four years (Annex 3). The Government has selected consultants, acceptable to the Bank, and agreed during negotiations to nominate a counter- part to each of the three experts. The appointment of the team and nomination of the counterparts constitute a condition of loan effectiveness. To maintain and update the levels of Highway Department staff the project provides 24 man-years of fellowship for staff that already has been employed at least for 3 to 5 years in the department. 3.12 Ministry of Transportation. The Ministry of Transportation intends to upgrade its Transport Planning and Coordination Unit (TPCU) to a Division of Studies and Planning (DSP) which will be the Ministry's principal transport planning, policy formulation and coordination agency. Since the Government's intention to increase its transport planning and coordination capacity is justified and appropriate, the project will assist the Government in its effort by providing five staff-years of economist/planner services and two staff-years of unallocated services for short-term experts, who would advise DSP on such matters as the improvement of operating procedures and the estab- lishment of a statistical unit. The Government has provided DSP's work program, and the outline terms of reference (Annex 4) have been agreed upon. During negotiations, the Government agreed that a counterpart to each of the experts will be nominated prior to the arrival of the experts. 3.13 Labogenie. To assist the national laboratory with the first phase of its long-term expansion program (para. 2.19) in strengthening its capacity for handling field and laboratory work, the project provides nine staff-years of technical assistance, eight one-year fellowships, procurement of laboratory equipment and construction of laboratory and office space in Yaounde and Douala. The terms of reference and qualifications of the experts (Annex 5) were confirmed during negotiations. The laboratory personnel will be sent to overseas schools and institutions to upgrade their technical skills. During negotiations, the Government confirmed the preliminary list of laboratory equipment proposed by Labogenie of which a final version will be submitted before June 30, 1983 for comments by the Bank and the experts employed under the project. The Government confirmed also that Labogenie staff for the fellowships will be selected not later than December 31, 1982. C. Status of Detailed Engineering 3.14 Consultants Gauff carried out the detailed engineering of the Douala-Yaounde Road in early 1980. According to French engineering practiceI, some of the final details were left undesigned (e.g., foundation details, steel reinforcement for concrete structures) and are to be completed by the  - 23 - successful bidder. Pavement design will also be completed during the early stages of execution of the works when the various soil types can be clearly defined. This practice is normal in francophone countries and the 10% physical contingency included in the cost estimates should cover possible quantity variations. D. Project Cost 3.15 The total cost of the project, net of taxes, is estimated at about US$219 million, with a foreign cost component of about US$170 million. The proposed Bank loan will finance the foreign exchange costs of the construction of lot 7, and all other project components with the exception of civil works for lot 6, 8 and 9. The Government has exempted all construction, consultant and technical assistance contracts from taxes. Thus, the component of local taxation is negligible and has not been considered in the estimates. Detailed cost estimates are as follows:  - 24 - US$ million at January 1982 prices Foreign as Proposed Local Foreign Total % of Total Loan 1. Construction Lot 6 (40.4 km) 6.9 23.1 30.0 77 - Lot 7 (65.3 km) 10.6 35.7 46.3 77 35.7 Lot 8 (61.8 km) 12.0 40.3 52.3 77 - Lot 9 (13.0 km) 4.3 14.6 18.9 77 - 2. Supervision of Lots from 6 to 9 Edea-Yaounde (180.5 km) 2.0 8.1 10.1 80 8.1 3. Technical Assistance (a) Highway Department. Tinistry of Equipment 0.3 1.4 1.7 82 1.4 (b) Planning Department, Ministry of Transpor- tation 0.2 0.8 1.0 80 0.8 4. Fellowships for Highway Department 0.1 0.6 0.7 90 0.6 5. Development of Labogenie (a) Building construction 0.6 1.3 1.9 70 1.3 (b) Equipment 0.2 1.7 1.9 90 1.7 (c) Fellowships - 0.2 0.2 100 0.2 (d) Technical assistance 0.3 1.0 1.3 77 1.0 6. Preinvestment Studies (a) Transportation plan 0.3 1.0 1.3 78 1.0 (b) Evaluation of paved roads (2,400 km) 0.3 1.4 1.7 82 1.4 Total excluding contingencies 38.1 131.2 169.3 77 53.2 Physical contingencies (10% on items 1, 5(a), 5(b)) 3.5 11.7 15.2 77 3.9 Price contingencies 7.7 26.6 34.3 78 11.9 TOTAL PROJECT COST 49.3 169.5 218.8 77 69.0 Front End Fee on Banks Loan - 1.0 1.0 100 1.0 Total Financing Required 49.3 170.5 219.8 78 70.0  - 25 - 3.16 The base cost estimates have been derived as follows: (i) Road Construction: cost estimates are based on bids for lots 6, 7 and 9 and the contract amount for lot 8. (ii) Building Construction: costs are based on per m2 prices for similar buildings constructed recently. (iii) Laboratory Equipment: a preliminary list of equipment needed for the laboratory established by Labogenie and priced according to supplier quotations. (iv) Consultant Services and Technical Assistance: The cost of con- struction supervision is based on priced proposals by consultants. This represents about 70 staff-years of consultant services at about US$12,000 per staff-month including salary costs, fees, international travel, and local subsistence and transport, the going rate of similar services in Cameroon. The cost of the transportation survey is based on 9 staff-years at US$12,000 per staff-month. The same estimate also applies to the pavement evaluation study (12 staff-years), and the technical assistance to the Highway Department (12 staff-years), the Ministry of Transport (7 staff-years) and to Labogenie (9 staff-years). 3.17 An allowance of 10% has been added for physical contingencies and the price contingencies are based on Bank guidelines. During negotiations, the cost estimates were agreed in the light of the latest available prices. E. Financing 3.18 A part of the foreign cost financing will be provided by a Bank loan of US$70.0 million of which about US$48.4 million will be for the road con- struction component. In addition, co-donors participating in the construction part would finance US$91.5 million while the Government would finance the remaining US$9.0 million of the foreign cost financing. The Government would also provide all the local cost for both the construction and non-construction components. The following are the details of the financing plan.  - 26 - A. Construction Estimated Cost Loan Amount Lot Number Length km US$ million US$ million Financing Agency 6 40.4 41.2 31.4 Kuwait/Islamic Bank/Abu Dhabi Fund 7 65.3 62.8 48.4 IBRD 8 61.8 64.4 43.7 The Netherlands 9 13.0 23.7 16.4 CIDA Subtotal 180.5 192.1 139.9 B. Other Project Items 26.7 20.6 IBRD TOTALS 218.8 160.5 3.19 To realize the economic benefits of the project construction com- ponents, it is essential that construction of all lots be completed at about the same time. Financing arrangements for lots 6, 8 and 9 of Section 2 have been completed and the effectiveness of the loans for these sections by the co-financiers constitutes a condition of effectiveness of the Bank's loan. As noted in para. 3.04, work on Section 1 is already underway. The financing for that section is secured and the financing plan is as follows: Estimated Cost Loan Amount Lot Number Length km US$ million US$ million Financing Agency 1 3.3 22.8 21.8 BAD/BADEA 2 14.2 23.2 20.3 France 3 2.3 11.4 6.3 The Netherlands 3 a bridge 10.0 7.0 FED 4 40.6 45.3 39.9 France 5 4.4 11.3 10.2 France TOTALS 64.8 124.0 105.5 The total estimated cost of Sections 1 and 2 is US$316.1 million of which US$245.4 million will be provided by external financing agencies including the Bank. In view of Cameroon's economic outlook, in particular its expected oil revenues, the Government should have no difficulties to finance the balance of US$70.7 million for the construction of the Douala-Yaounde road and US$6.1 million for the other project items. The above financing arrangements were confirmed during negotiations.  - 27 - F. Implementation 3.20 The Ministry of Equipment (MINEQ) will have the responsibility for the implementation of all project components with the exception of the transportation survey and the technical assistance to the Division of Studies and Planning for which the Ministry of Transport (MINT) will be responsible. 3.21 MINEQ will be assisted by consultants in the project implementation, in particular in the supervision of the construction of Section II, carried out by contractors. The following chart shows the expected schedule of imple- mentation of each component of the project; this schedule was confirmed with the Government during negotiations. TIMING OF COMPONENT ACTIVITIES 1981 1982 1983 1984 1985 1986 Road Construction - Lot 6- - Lot 7- --- - - Lot 8 - - Lot 9 _ Technical Assistance - Highway Department - - Planning Department _ Fellowships for Highway - Department Labogenie - Bldg. Construction - - Fellowships - Equipment - Technical Asst. _ Transportation Plan - Evaluation of Paved Roads -  - 28 - 3.22 The technical assistance provided to Labogenie will review the personnel requirements of the laboratory and propose candidates for overseas studies, study the equipment needs of the laboratory and finalize the procure- ment list. The experts will assist Labogenie's Director in formulating a practicable program and to carry out its implementation. G. Procurement 3.23 Procurement under the project will be in accordance with the Bank's procurement guidelines. The following procedures would apply: Project Element Procurement Procedure Road Construction International Competitive Bidding (ICB). Building Construction Local Competitive Bidding procedures, which are satisfactory. Laboratory Equipment Equipment items, not exceeding US$10,000 and accumulative not to exceed US$300,000 may be procured through limited international tenderiLng on the basis of offers from at least three suppliers. Major equipment under ICB. Consultant Services and Consultants short-listed by Government, to Technical Assistance to submit proposals. The qualifications and the Highway Department experience of the consultants selected as wel]L as the terms and conditions of contract to be approved by the Bank. Technical Assistance to Where Government chooses to use consulting firms the MINT and Labogenie for the provision of technical assistance, the above procedure applies. If Government decides to hire individual experts, final selection based on the experts' curriculum vitae, and terms and conditions of contract to be subject to Bank approval. The above procurement procedures were discussed and agreed upon with the Government during negotiations. H. Disbursements 3.24 The Bank loan would be disbursed as follows: Civil Works 77% of total cost Equipment 100% of foreign cost Consultant Services & Technical Assistance 80% of total cost Fellowships 90% of total cost  - 29 - An amount o-: US$16.0 million would remain unallocated. To allow for the financing of the cost of supervision by consultants of the ongoing construc- tion of lot 8 (para. 3.05) and for the cost of consultants to provide assis- tance to the DH (para 3.11), the project includes an amount of maximum US$1.5 million for the retroactive financing of these expenditures incurred after February 1, 1982. All disbursement applications would be fully documented. The estimated schedule of disbursements is shown in Table 3.2. Disbursements will be somewhat faster compared to the disbursement profile for the transpor- tation sector in Cameroon because bids for lot 7, the major item of Bank financing in the project, have been evaluated and construction of lot 7 could thus start shortly after Board presentation. IV. ECONOMIC EVALUATION A. General 4.01 Upgrading of the Douala-Edea-Yaounde Road has high priority (para. 2.03). Its paving would provide all weather road access in the country's dominant transport corridor, increase capacity to accommodate the growing demand for transport and link, by road, the port of Douala to the capital. Currently, the poor condition of the unpaved Edea-Yaounde section makes it virtually impassable during the rains, and, during the rest of the year, transport costs are high. 4.02 The economic evaluation has been carried out in two stages: (i) for the whole of the Douala-Edea-Yaounde Road; and (ii) for the Douala-Edea and Edea-Yaounde sections. Project costs include: (i) base construction costs; (ii) physical contingencies; and (iii) supervision of works. The analysis is based on the consultants' feasibility study and updated to reflect the findings of the appraisal and post appraisal missions. 4.03 Distance savings, i.e., avoided vehicle operating costs form the major basis for the evaluation of the Douala-Edea section. The existing road is virtually unmaintainable because of its advanced deterioration. Heavy and costly maintenance, required more and more frequently, has not been able to arrest the accelerating rate of deterioration. The technical options consist of (i) either rehabilitating and reconstructing the section on the existing alignment; or (ii) construction on a substantially new alignment. While the former option is estimated to be about a third less costly, the latter results in 36 km of distance savings and is the preferred technical and economic solution. 4.04 The evaluation of the Edea-Yaounde section is based on road user savings. The existing earth road provides mainly dry season access. When the road is opened to traffic in 1986, about 1,700 vehicles a day are expected to use it. Over 70% of these vehicles would be the normal traffic. This traffic load would be beyond the physical capacity of a laterite road especially because of the long rainy season and difficult terrain through much of the Edea-Yaounde section. Under these conditions, the maintenance of the existing road would be impracticable.  - 30 - 4.05 The economic rate of return on construction investments in the entire Douala-Edea-Yaounde Road is a satisfactory 26%. A 20% increase in construction costs would lower the rate of return to an acceptable 22%. The estimated rates of return for the Douala-Edea section is 28%, and 24% for Edea-Yaounde, the proposed project road. Details of the economic analysis are shown in tables 4.1 through 4.3. B. Project Benefits and Beneficiaries 4.06 The bulk of quantified benefits for the Edea-Yaounde section are due to road user savings resulting from the upgraded road conditions. Overall, about 75% of the benefits accrue to normal traffic and result from vehicle operating cost savings. Benefits to generated and diverted air passenger traffic make up another 10% of the total while the rest are from savings in road maintenance costs. The net benefits attributed by consultants to traffic (representing about 10% of the total road traffic) diverted from the railroad to the road have been excluded from the analysis considering the distances over which this diversion would take place and the nature of the commodities involved. Benefits due to diverted air passenger traffic have been prorated on the basis of length relative to the complete road and have been assumed to stagnate in 1990 with no corresponding increase in growth thereafter. 4.07 Unquantified benefits would include cargo and passenger journey time savings, avoided road closures, improved quality and comfort of passenger transport and increased level of economic activity in the entire corridor. Although these benefits have not been quantified, they could be substantial. 4.08 The Edea-Yaounde section is expected to have widespread beneficia- ries: it would provide reliable year-round access and reduce transport costs in the corridor linking two major urban centers of the country. Immediate beneficiaries would include the road users: automobile owners, passenger transporters and truckers. As the transport industry is competitive, some of the reduced transport costs are expected to be passed on to consumers in the form of reduced costs and to small farmers in the form of increased farm gate prices for regional commodities such as cocoa. All weather access would also remedy the occasional shortages of staples and fish (from Douala) which occur because the road is intermittantly closed in the rainy season. In the final analysis, the country as a whole would benefit from a reliable transport facility and reduced costs. 4.09 Additionally, the project is designed to have an impact on institu-- tional development. Continuation of technical assistance to MOT is expected to increase the ministry's planning and sector management capacity through the transfer of planning technology and the improvement in records management. The proposed national transport survey would be the basis for developing a systematic long term perspective on the evolving needs of the sector, deline- ating future project priorities, providing a rational basis for intrasectoral investment allocations and training Cameroonian counterparts in formulating, implementing and monitoring transport plans. Technical assistance to  - 31 - Labogenie would assist in the development of this long range approach and provide effective support for the control of civil works. The implementation of the pavement monitoring and evaluation study would provide DH with capacity to improve paved road maintenance through timely periodic intervention which would help to postpone costly reconstruction on some of the network. Finally, technical assistance to DH would be instrumental in ensuring the proper control and execution of the construction part of the project. C. Economic Analysis 4.10 Existing traffic volumes are based on the consultants' origin- destination surveys (conducted in April 1979), the consultants' feasibility study and the analysis of DH traffic counts for 1975 through 1980 on specific sections of the Edea-Yaounde Road. Freight transport data were used as a check on the base volumes of trucks. The estimated traffic on the road in the opening year is: Estimated Traffic (vpd) in 1986 Normal Generated Diverted 1/ Total Air Rail Passenger Car 502 62 170 - 734 Minibus/Van 318 - 8 14 340 Bus - - - 14 14 Medium Truck 325 40 - 145 510 Heavy Truck 123 16 - - 139 Total 1,268 118 178 173 1,737 1/ Consultants estimates. Source: GAUFF (Consultants), MINE and mission estimates 1980. 4.11 Normal traffic growth is estimated indirectly through the national trends in motor vehicle registrations, fuel consumption and other indicators such as the evolution of GDP and growth trends on past Bank-assisted projects in Cameroon. Based on these trends, the annual growth rate of 10% through 1990 and 6% thereafter is retained and appears reasonable. DH volume counts were useful to check the composition of traffic. 4.12 Generated traffic is estimated based on the consultants demand/cost elasticity model using marginal cost differences but has been revised down- wards from the original estimates to reflect lower than the consultants' estimated savings from paving the road. Estimates of traffic diverted from the rail and air are based on the consultants' feasibility study.  - 32 - 4.13 Vehicle operating costs were established by consultants (Table 4.4) and have been modified to reflect the increased fuel prices since January 1979. All economic costs and benefits are calculated in 1980 values and are net of taxes. 4.14 Because numerous segments of the existing Edea-Yaounde road have capacity constraints even for the present traffic, are intermittently closed, are inadequately drained and are below grade, the "without" project scenario assumes rehabilitation in 1982. Periodic regravelling is conservatively estimated at once every three years. Estimated routine maintenance reflects engineering judgment and the intensity of traffic. The "with" project scenario includes overlays every eight years in addition to routine mainte- nance, including patching, sealing cracks and drainage maintenance. The economic life of the project road is twenty years and the opening year is 1986. Value of travel time saved, distance savings (resulting from a negligible decrease in length after construction) and salvage value have been excluded from the analysis. 4.15 Based on project costs and benefits, the best estimate of the economic rate of return is 24% and the net present value, discounted at 12%, the estimated opportunity cost of capital in Cameroon, is about US$37 million. Because some elements of the analysis may be less reliable than others, sensitivity tests have been done to measure how much they vary the rate of return. The tests address: (i) possible cost underestimation of proposed works; (ii) the possibility that in addition to (i), rehabilitation of the existing road and periodic maintenance also could have been underestimated; (iii) the possibility that road user savings may be overestimated; (iv) the possibility that air passengers would not divert to the road; (v) the possi- bility that base traffic could have been overestimated; and (vi) the risk that the quantified costs and benefits of the project do not reflect efficiency criteria which would mean that net benefits may be biased. 4.16 The following results were obtained: Scenario Economic Rate of Return Best estimate 24% 20% construction cost increase 21% 20% increase in paved road construction and periodic maintenance costs with a similar increase in unpaved road periodic maintenance costs 20% Additionally, road user saving decrease by 20% 18% No benefits from diverted air traffic 24% Traffic decreases by 20% 21% Costs and benefits valued at efficiency prices with labor-assigned shadow wages 26%  - 33 - The sensitivity tests indicate that construction is economically feasible under various reasonable combinations of adverse conditions. Separate statistical tests on the expected net present value, assuming reasonably beneficial and adverse outcomes of the project, also indicate similarly positive results, based on which, it is extremely unlikely that the rate of return would be below 12%. 4.17 Apart from the possible quantity variations outlined in para. 3.14, the works have few technical risks as they are based on sound engineering principles, involve normal road construction practices and will be supervised by competent consultants. But, there is a risk that the proposed technical assistance to MOT may not achieve its intended objectives due to slow imple- mentation. Nonetheless the proposed technical assistance would be indis- pensable for the development of DSP's planning capacity because MOT intends to turn it into its principal planning and policy coordinating arm. Additionally, MOT and the Bank have already agreed on the terms of reference for the proposed technical assistance and the transport survey. V. AGREEMENTS REACHED AND RECOMMENDATION 5.01 During negotiations, the following was discussed and agreed upon with the Government and incorporated as covenants in the Loan Agreement: (i) the construction of all lots of the Douala-Edea Road would be contracted by December 31, 1982, according to acceptable engi- neering standards; the Bank should be informed of any modifica- tion of design standards and extension of construction deadlines (paras. 3.04 and 3.05); (ii) procurement for laboratory equipment will be subject to the sub- stantial completion of new laboratory buildings (para. 3.07); (iii) consultants will be appointed under terms and conditions acceptable to the Bank to: (a) supervise construction of lots 6-9 during the entire construction period (para. 3.08); (b) carry out the trans- portation survey (para. 3.09); and (c) evaluate the paved road system (para. 3.10); (iv) results and recommendations of the transportation survey will be discussed with the Bank (para. 3.09); (v) counterparts will be nominated prior to the arrival of each expert for the technical assistance to the Ministry of Transportation (para. 3.12); and (vi) the Government will present to the Bank for review and comment (a) before June 30, 1983, a final list of equipment to be purchased for Labogenie (para. 3.13); and (b) not later than December 31, 1982, a list of fellowships for laboratory personnel (para. 3.13).  - 34 - 5.02 During negotiations, the following items were reviewed and confirmed with the Government: (i) the terms of reference for technical assistance for Ministry of Transport (para. 3.12) and for Labogenie (para. 3.13); (ii) a preliminary list of the required laboratory equipment proposed by Labogenie (para. 3.13); (iii) cost estimates for the project (para. 3.17); (iv) the financing arrangements for the project and the Douala-Edea road construction (para. 3.19); and (v) the implementation schedule for each element of the project (para. 3.21). 5.03 The following are conditions of loan effectiveness: (i) the appointment of consultants to supervise construction of lots 6, 7 and 9 (para. 3.08); (ii) the appointment of a team of three engineers to assist the Highway Department and the nomination of counterparts (para. 3.11); and (iii) the effectiveness of the Loans by the co-financiers for Section 2 (para 3.19). 5.04 The proposed project is suitable for a loan of US$70 million equi- valent on standard Bank terms to the Government of the United Republic of Cameroon.  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT National Motor Vehicle Registrations, 1960-1979 (Excluding Two Wheelers) Year Passenger Cars Vans Trucks Buses Special Purpose Total 1960 830 550 190 180 100 1,850 1965 1,850 800 370 210 250 3,480 1970 3,900 - 1,000 300 300 5,500 1971 3,700 - 700 400 200 5,000 1972 2,200 1,100 700 400 200 4,600 1973 5,500 1,700 700 400 200 8,500 1974 7,800 2,700 2,400 500 200 13,600 1975 8,600 2,800 1,600 900 300 14,200 1976 6,800 2,200 1,500 800 400 11,700 1977 7,300 2,400 1,800 1,000 500 13,000 1978 9,100 2,900 2,300 1,000 500 15,800 1979 NA NA NA NA NA NA Average Annual Growth (%) 1960-1978 14.0 10.0 15.0 10.0 9.0 13.0 1965-1978 13.0 10.0 15.0 13.0 7.0 12.0 1973-1978 11.0 11.0 27.0 20.0 20.0 13.0 Estimated Vehicle Fleet-/ Number 49,000 15,000 11,000 5,000 3,000 83,000 % 59 18 13 6 4 100 1/ Mission Estimates based on data in files. > Source: Ministry of Transport, November 1979. Note: Fleet figures are subject to considerable margin of error.  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Fuel Consumption by Road Users for Selected Years, 1968-1979 Fuel Imports (metric tons) -/ Fuel Imports (m ) 2/ Fuel Consumption (m ) -/ FY Gasoline Diesel Total Gasoline Diesel Total Gasoline Diesel Total 1968 70,000 71,000 141,000 93,000 82,000 175,000 -- -- -- 1973 94,000 120,000 214,000 125,000 138,000 263,000 133,000 137,000 270,000 1978 144,000 208,000 352,000 192,000 239,000 431,000 217,000 266,000 483,000 1979 -- -- -- -- -- -- 233,000 312,000 545,000 Annual Increase Metric Tons m m3 1968-1978 10% 9% 1973-1978 10% 10% 12% 1973-1979 - - 12% 1/ Source: Government Import Statistics, Cameroon. 2/ Assuming density in metric tons per m or gm per cc of 0.75 for-gasoline and 0.87 for diesel. 3/ Source: Ministry of Economy and Planning, Cameroon December 1980  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Evolution of Retail Fuel Price for Selected Years, 1971-1979 (CFAF/litre, Douala-Bonaberi) - 1971 1973 1973 1974 1976 1978 1979 1979 (November) (July) (October) (February) (October) (May) (February) (October) Gasoline Super 48.20 52.80 55.00 72.50 81.70 90.70 101.00 117.00 Ordinary 42.10 44.70 46.30 63.80 72.90 81.90 92.00 108.00 Diesel Fuel 27.70 29.50 30.70 53.70 58.50 66.30 73.30 89.30 Percent Increase 4 November 1971-October 1979 July 1973 - October 1979 February 1974 - October 1979 Gasoline Super 143.O 122.0 61.0 Ordinary 157.0 142.0 69.0 Diesel 222.0 202.0 66.0 Source: Ministry of Transport, November 1980.  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Retail Price of Motor Fuel in Selected Cities-l/ CFAF/litre, October 1979 C.I.F. Douala Garoua Koussari Douala Including Taxes Net of Taxes Including Taxes Net of Taxes Including Taxes Net of Taxes Gasoline Super 40.67 117.00 63.74 128.00 74.74 146.00 92.74 Ordinary 38.30 108.00 57.96 119.00 68.96 137.00 86.96 Diesel Fuel 38.37 89.30 53.58 108.00 72.28 126.00 90.28 U.S.$/Gallon, October 1979 Gasoline Super 0.73 2.16 1.15 2.31 1.35 2.63 1.67 Ordinary 0.69 1.95 1.04 2.14 1.24 2.47 1.57 Diesel Fuel 0.69 1.61 0.97 1.95 1.30 2.27 1.63 1/ Taxes include import duties, cross product subsidies and price stabilization levies. 1 U.S. Gallon , 3.785 litres, 1 U.S.$ - CFAF 210 Source: IBRD, Draft Cameroon Energy Report, October 1979.  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Comparison Between Domestic Retail and International Petroleum Product Prices -/ (U.S.$/barrel, October 1979) Domestic Retail Average European and Ratio of Domestic Retail to Price Caribbean Price International Price Gasoline Super 88.62 45.00 1.97 Ordinary 81.90 42.00 1.95 Diesel Fuel 67.62 42.00 1.61 1/ Average bulk spot price, FOB, Caribbean and Rotterdam. Inclusion of transport costs to Cameroon would lower somewhat the price ratios. Source: IBRB Draft Cameroon Energy Report, October 1979. U'  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Government Road Construction Outlays, l/ 1972-1978 (CFAF million, 1978 prices by fiscal Year) 2/ 1972 1973 1974 1975 1976 1977 1978 Investment Budget 2,242 2,188 3,376 1,469 2,745 4,679 6,314 Extra-Budgetary 389 770 112 2,566 2,681 1,083 171 Foreign and Domestic Borrowings 418 4,798 1,159 6,719 5,727 3,897 2,353 Foreign Subsidies 29 858 169 2,666 1,980 910 102 TOTAL 3,078 8,614 4,816 13,420 13,133 10,569 8,940 Inflator (Construction cost index) 1.77 1.70 1.55 1.31 1.21 1.11 1.00 1/ Additional expenditures were incurred by public and private organizations including local governments. 2/ Domestic borrowings were recorded only for FY1973 and totaled about CFAF 500 million. Source: Ministry of Economy and Planning, January 1981. t  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Road Revenues,-/ 1972-1978 (CFAF million) 2/ 2/ 1972 1973 1974 1975 1976 1977 1978 New Vehicles 5,683 6,551 6,750 6,623 8,503 9,680 14,000 Spare parts and tires 1,800 1,759 1,583 1,504 2,110 3,050 2,900 Fuel 5,610 6,516 5,724 5,503 5,393 6,820 6,900 Annual tax on vehicles 673 607 439 432 450 550 600 TOTAL 13,766 15,433 14,496 14,062 16,456 20,100 24,400 1/ January 1976 prices for 1972.- 1976. Average 1978 prices for 1977 - 1978. H 2/ Preliminary figures based on MOT and mission estimates, consumption estimates. Source: Ministry of Economy and Planning, December 1978; MOT and mission estimates November 1980, January 1981.  - 42 - Table 3.1 UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Design Standards for the Edea-Yaounde Road Geometric Design Standards Design Speed : 80 km/hour Minimum Radius of Curvature : 450 m Maximum Gradient : 6% exceptionally 8.5% Width of Pavement : 7.40 m (two lanes) Width of Shoulders : 2.00 m (each side) Width of Right of Way :70 m (minimum) Zone non oedificandi : to be agreed during negotiations Structural Design Features Pavement: Surface Course : 6 cm asphalt concrete (hot mix) Base Course : 12 cm asphalt binder crushed stone (or equivalent) Sub-base Course : 25 cm cement stabilized laterite (or equivalent) Service Life : 20 year (overlay at 15 years) Design Traffic : T4 type corresponding to 5 x 106 passes of 13 tons equivalent axle load Bridge: Bridge Width : 10.40 m Bridge Loading : French standards, Class 1 bridge; Ministry of Equipment, France CCTG, Fascicules 65 and 66  - 43 - TABLE 3.2 ESTIMATED SCHEDULE OF DISBURSEMENTS IBRD Fiscal Year Cummulative Disbursements and Quarter Ending at End of Quarter (US$ '000) 1983 December 1982 2,000 March 1983 12,000 June 1983 14,000 1984 September 1983 17,000 December 1983 20,000 March 1984 23,000 June 1984 26,000 1985 September 1984 29,000 December 1984 32,000 March 1985 37,000 June 1985 42,000 1986 September 1985 46,000 December 1985 50,000 March 1986 55,000 June 1987 60,000 1987 September 1986 64,000 December. 1986 67 000 March 1987 69,000 June 1987 70,000  UNITED REPUBLIC OF CAMEROON Douala-Edea-Yaounde Road Summary of Economic Costs and Benefits (1980 U.S.$ million) Road Section Douala-Edea- Edea-Yaounde- Total Const./Maint. Avoided Distance Benefits to Const./Maint. User Cost Benefits to Net Year Cost Savings Savings Diverted Air Traffic Cost Savings Savings Diverted Air Traffic Benefits 1 19.000 4.600 19.000 2 35.500 --- 3.200 35.200 3 64.640 --- -- 58.940 64.640 4 0.000 ~ ~ - ~ ~~ 35 24Q 14.240 5 0.076 15.642 ___ 10.240 13.732 2.052 36.550 6 0.076 17.206 0.785 - 0.076 15.105 2.196 36.823 7 0.076 18.927 0.840 - 0.076 16.616 2.349 38.732 8 0.076 20.820 0.899 28.064 18,277 2.514 70.650 9 0.076 22.901 0.962 - 0.076 20.105 2.690 46.658 10 7.600 25.192 1.029 - 0.076 22.116 2.878 58.739 11 0.076 26.704 1.029 28.064 23.443 2.878 82.194 12 0.076 28.306 1.029 -33.940 24.850 2.878 23.199 13 0.076 30.004 1.029 - 0.076 26.341 2.878 60.252 14 0.076 31.804 1.029 28.064 27.921 2.878 91.772 15 0.076 33.713 1.029 - 0.076 29.596 2.878 63.216 16 0.076 35.735 1.029 - 0.076 31.372 2.878 71.014 17 7.600 37.879 1.029 28.064 33.254 2.878 110.705 18 0.076 40.152 1.029 - 0.076 35.250 2.878 79.309 19 0.076 42.561 1.029 - 0.076 37.365 2.878 83.833 20 0.076 45.115 1.029 - 5.800 39.606 2.878 82.904 21 0.076 47.821 1.029 - 0.076 41.983 2.878 93.711 22 0.076 50.961 1.029 - 0.076 44.502 2.878 96.492 23 0.076 53.732 1.029 28.064 47.172 2.878 132.951 24 0.076 56.956 1.029 - 0.076 50.002 2.878 110.865 IRR Best estimate ~ 26.4% Const. cost increase 20%= 22.4% I/ See Table 4.3 for details. 2/ See Table 4.4 for details. APRIL 1981  UNITED REPUBLIC OF CAMEROON Douala-Edea Section Summary of Economic Costs and Benefits (1980 U.S.$ million) Savings in 1/ 2/ Maintenance Construction Avoided- Benefits- Construction Reconstruction New Alignment Old Alignment and Mainte- Distance to Diverted Net Year New Alignment Old Alignment Periodic Routine Periodic Routine nance Costs Savings Air Traffic Benefits 1 14.400 -14.400 -14.400 2 38.400 -38.400 -38.400 3 35.700 30.000 -35.700 - 5.700 4 9.000 30.000 21.000 21.000 5 0.124 0.200 0.076 15.642 - 15.718 6 0.124 0.200 0.076 17.206 - i7 82 7 0.124 0.200 0.076 18.927 0.840 19.843 8 0.124 0.200 0.076 20.820 0.899 21.795 9 0.124 0.200 0.076 22.901 0.962 23.939 10 0.124 0.200 0.076 25.192 1.029 26.297 11 12.400 20.000 7.600 26.704 1.029 35.333 12 0.124 0.200 0.076 28.306 1.029 29.411 13 0.124 0.200 0.076 30.004 1.029 31.109 14 0.124 0.200 0.076 31.804 1.029 32.909 15 0.124 0.200 0.076 33.713 1.029 34.818 16 0.124 0.200 0.076 35.735 1.029 36.840 17 0.124 0.200 0.076 37.879 1.029 38.984 18 12.400 20.000 7.600 40.152 1.029 48.781 19 0.124 0.200 0.076 42.561 1.029 43.666 20 0.124 0.200 0.076 45.115 1.029 46.220 21 0.124 0.200 0.076 47.821 1.029 48.926 22 0.124 0.200 0.076 50.691 1.029 51.796 23 0.124 0.200 0.076 53.732 1.029 54.837 24 0.124 0.200 0.076 56.956 1.029 58.061 Rates of Return Best estimate = 28.4% Const. cost increase 20% = 23.7% No benefits to diverted traffic = 28.1Z Base year traffic decrease 20% = 22.3% Efficiency prices and shadow wages = 29.7t (see note 3, Table 4.4) 1/ Traffic growth of 10% per annum up to 1990 6% thereafter 2/ Benefits begin in 1986 after completion of Edea-Yaounde section. Annual growth 7% up to 1990 and constant thereafter. APRIL 1981  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT The Project. Edea-Yaoumde Section Summary of Economic Costs and Benefits (1980 U.S.$ million) Savings in 2/ Maintenance Construction Benefits to- Construction Rehabilitation New Road Old Road and Mainte- User CostI Diverted Air Net Year New Road Old Road Periodic Routine Periodic Routine nance Costs Savings Traffic Benefits 1 4.600 - _ 4.600 _ 4.600 2 35.800 39.000 + 3.200 - + 3,200 3 59.200 0 0.260 -58.940 - '58.940 4 35.500 0.260 -35.240 - -35.240 5 20.100 28.400 - + 8.300 13.732 22.032 6 3.500 0.260 3.240 15.105 2.196 14.061 7 0.336 0.260 - 0.076 16.616 2.349 18.899 8 0.336 28.400 28.064 18.277 2.514 48.555 9 0.336 0.260 0.076 20.105 2.690 22.719 10 0.336 0.260 - 0.076 22.116 2.878 24.918 11 0.336 28.400 28.064 23.443 2.878 54.385 12 34.200 0.260 -33.940 24.850 2.878 -6.212 13 0.336 0.260 - 0.076 26.341 2.878 29.143 14 0.336 28.400 28.064 27.921 2.878 58.863 15 0.336 0.260 - 0.076 29.596 2.878 32.398 16 0.336 0.260 - 0.076 31.372 2.878 34.174 17 0.336 28.400 28.064 33.254 2.878 64.196 18 0.336 0.260 - 0.076 35.250 2.878 38.052 19 0.336 0.260 - 0.076 37.365 2.878 40.167 20 34.200 0.336 28.400 - 5.800 39.606 2.878 36.684 21 0.336 0.260 - 0.076 41.983 2.878 44.785 22 0.336 0.260 - 0.076 44.502 2.878 47.304 23 0.336 28.400 28.064 47.172 2.878 78.114 24 0.336 0.260 - 0.076 50.002 2.878 52.956 Rates of Returns Best estimate = 24.5X Net Present Value Const. cost increase 20% - 20.9% All const., rehabilitation and periodic maintenance costs increase 20% - 20% Net present value discounted at 12% = US$88.97 million 4- User cast savings decrease 20% - 18.3% - it pr ent value Hbscounted at 15% = US$37.51 million No benefits to diverted air traffic = 24.1X Expected Net present value at 12% *US4a.67 milliou Base year traffic decreases by 20% = 19.8% with a standard deviation of US$9.21 million. Efficiency pKices with shadow wages = 26.1% w 1/ Traffic growth of 10% per annum up to 1990 and 6% thereafter. 2/ Annual growth of 7% per annum up to 1990 and 0% thereafter. 3/ Efficiency values converted on following basis; CF Construction and periodic maintenance = 0.69 CF routine maintenance = 0.73 = SCF CF User cost savings and benefits to diverted air traffic = 0.77 Shadow wage skilled labor = 0.70 Shadow wage unskilled labor = 0.55, APRIL 1981  UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Vehicle Operating Costs/km (CFAF net of taxes, 1980 prices) Paved Road Condition Unpaved Road Condition Vehicle Type Good Fair Poor Bad Good Fair Poor Bad Passenger Car 21 23 25 32 23 28 32 38 Van/Mini Bus 39 41 52 66 44 58 74 90 Medium Truck 97 103 160 163 106 140 179 219 Heavy Truck 339 359 454 583 371 505 649 798 Source: Gauff: Route, Douala-Edea-Yaounde, Etude Economique (1979) and estimates. Harris, Inc: L'Entretien Routier (August 1977).  ANNEX 1 - 480 - Page 1 UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Past Bank Group Assistance 1. Bank group assistance to the Cameroonian road subsector started in 1964 with the provision of a Technical Assistance grant of US$200,000 for the feasibility studies of improvements on the Ngaoundere-Garoua Road (246 km). This was followed in 1968 by an Engineering Credit of US$600,000 for detailed engineering of that road in addition to the Tiko-Victoria Road (22 km). On the basis of these studies, the First Highway Project was pre- pared in 1970. The Second and Third Highway Project followed in 1973 and 1978 respectively. The strategy for Bank Group assistance to the road subsector has been in line with the evolving needs of the subsector. The first three projects were implemented to fill the gaps between major trunk road connecting populated areas with considerable economic potential. The Feeder Roads Project, approved in 1977 and currently facing implementation difficulties, addresses the needs of the rural/agricultural roads in accordance with the Government's emphasis on rural development. The Fourth Highway Project which was approved in 1978, is now being implemented after initial delays and is aimed at improving the DH capacity to organise, plan and execute the routine and periodic maintenance of the unpaved network. The Bank Group has also provided funding for four railway projects and two port projects. Since 1964, Bank assistance to the Cameroonian Transport Sector has totalled US$268.3 million in loans, credits and grants. Overall the Bank Group experience with removing the physical transport handicaps to Cameroon's development has been satisfactory. However, success in developing the institutional framework has been less satisfactory and needs bettering. Various components of the proposed Fifth Highway Project would tackle this including strengthening and streamlining the Governments transport planning and coordinating capacity. 2. The First Highway Project (Loan 663/Credit 180 CM, US$19.9 million, March 1970) included construction of the Ngaoundere-Garoua and Tiki-Victoria Roads to paved standards and preinvestment studies for the improvement of the Garoua-Mora (258 km) and Douala-Kekem (161 km) Roads. The Tiko-Victoria Road was satisfactorily completed in April 1973. Construction of the Ngaoundere- Garoua Road encountered technical difficulties when, during the 1973 rainy season, about 60 km of completed sections started to break up because of poor drainage. The drainage design was modified, failing sections were repaired and the road was completed without a significant increase in the expected volume of works in June 1975 two years later than expected. The road is in good condition. As a result of inflation, the delayed completion of the works increased construction costs. The Government bore the entire overrun, but the Bank agreed to finance an additional US$2.0 million to compensate for the devaluation of the US dollar during project execution. The Project Performance Audit Report (No. 1574, April 29, 1977) for the First Highway Project concluded that, in addition to reducing delays in project implementation, the Government should better coordinate transport activities. Improvements are being carriecd out partially under the Technical Assistance, the Third and Fourth Highway Projects. The transport sector survey proposed for financing under the proposed project has also been designed to achieve this objective.  - 49 - ANNEX 1 Page 2 3. The Second Highway Project (Loan 935/Credit 429 CM, US$48.0 million September 1973) comprised construction of three trunk roads to paved standards, a road maintenance study, and technical assistance. Construction of the Pont du Noun (Bafoussam)-Foumban road (50 km) was satisfactorily completed in December 1976 of the Figuil-Mora section (163 km) of the Garoua-Mora Road in July 1977, and of the Douala-Kekem Road in July 1978. The road maintenance study was completed in May 1978 and served partly as the basis for preparing the fourth project. Technical assistance has been provided to DH since April 1977. The reconnaissance study of forestry evacuation roads was com- pleted in December 1978. The project suffered from the 1973-74 world-wide inflation, which nearly doubled its total cost. Consequently, the Government agreed to defer construction of the Garoua-Figuil Road section (95 km) under the Third Highway Project. A supplementary Credit of US$15.0 million was approved in March 1976 to help alleviate the burden imposed on the Government by the project's cost overrun. 4. The Third Highway Project (Loan 1515 CM, US$16.5 million, April 1978) included construction of the Garoua-Figuil Road section deleted from the Second Highway Project and technical assistance to strengthen transport planning and coordination within the Ministry of Transport. Construction was completed in July 1979 but technical assistance is continuing. The Project Completion Report for the Second and Third Highway Projects (July 17, 1980) concluded that the impact of the substantial increase in project cost on the economic benefits was offset by larger than expected increases in traffic. The re-estimated rates of return for the two projects were about the same as expected during appraisal (20%). The Project Completion Report also noted that progress in developing transport-related institutions has been slow compared with considerable progress made in upgrading the land transport system over the last decade. 5. Implementation of the Feeder Roads Project (Loan 1494/Credit 749 CM, US$11.1 million, December 1977) started in 1978. The project includes creation of the Central Feeder Roads Unit within DH and a four-year construc- tion program for 2,200 km of feeder roads. Project implementation is behind schedule because the organization in charge is understaffed and because of shortage of local funds. The Government is to submit for Bank approval a modified program for project execution reflecting considerable feeder road construction cost increases. 6. The Fourth Highway Project (Loan 1723/ Credit 926, US$48 million, August 1979) comprises training of staff and workers for road maintenance, maintenance of about 17,000 km of roads and rehabilitation of 1,700 km through force account and domestic contractors, technical assistance to the domestic construction industry, two permanent weighing stations, and pre-investment studies for the proposed project and forestry evacuation roads. Implementa- tion of the Fourth Highway Project has started after initial difficulties with recruiting consultants, equipment procurements, setting up the training brigade and the training center.  - 50 - ANNEX 2 Page 1 UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Terms of Reference for Consulting Engineers to Evaluate the Condition of the Paved Road Network and to Design Road Reconstruction and Maintenance Programs Introduction 1. The Government of the United Republic of Cameroon intends to carry out a study on systematic methodologies for maintenance, conservation, and betterment of its paved road network which comprises about 2,400 km constructed at various times to differing standards and carrying variable traffic flows. The Government will need the services of experienced consultants to carry out the proposed study in collaboration with Labogenie, the Government's Civil Works Laboratory. The aims of the study are to evaluate the condition of the selected roads, define a reconstruction and maintenance policy, establish a hierarchy of needs, design the reconstruction and maintenance programs, estimate their costs, and for the top priority items to prepare appropriate engineering design and contract documents in preparation for the award of contracts. Consultants should liaise with Lavalin International on questions related to cost and techniques of routine maintenance of paved roads. At present Lavalin is in the field implementing a maintenance program under the Fourth Highway Project. 2. It is expected that the major portion of the work will involve determining the appropriate thickness and timing of asphaltic concrete over- lays, or reconstruction of pavement and base courses over a certain length, or resealing or surface dressing other sections after necessary local repairs have been carried out. The study should be complete including evaluation and if needed the redesign of drainage structures, ditches, shoulders, pavement width and possibly minor corrections of the alignment. The study should optimize the reconstruction and maintenance system and minimize the total cost. 1/ The reconstruction and maintenance system should include all possible activities ranging from reconstruction through rehabilitation, pavement widening and strengthening, surface dressing, resealing and repair of drainage structure and ditches to routine maintenance. The selected activities should be scheduled in an optimum sequence. 1/ For reference purposes, consultants may use "Pavement Management Systems" by R. Haas and W.R. Hudson. McGraw-Hill Book Company (1978).  - 51 - ANNEX 2 Page 2 Objectives 3. The objectives of the study are: (i) to evaluate the different pavement structures' capacity to withstand present and future traffic conditions under the various regional, topographic, and climatic conditions; (ii) to design reasonably phased reconstruction and maintenance programs for the whole paved road network; (iii) to prepare economic and engineering feasibility studies for the proposed reconstruction and maintenance programs; and (iv) to prepare the final engineering and bidding documents for work on those sections which should be undertaken during the first three years. Scope of Consultant Services Phase I 4. Consultants should carry out: (i) an inventory of about 2,400 km of paved road network including existing conditions of the roads (alignment, grades, pavement structure, and drainage, etc.); (ii) an estimate of traffic based on the existing data (traffic count including its composition, loads and projection); (iii) an inventory of the geotechnical conditions including a qualitative and quantitative evaluation of construction materials; (iv) visual inspection, sample recovery, and in situ and laboratory tests and pavement roughness measurements as deemed necessary; (v) deflection tests of the existing pavements once before the rainy season and once at the end of the rainy season; 1/ (vi) pavement evaluation in light of the existing conditions; (vii) review of the existing roads and study alternative reconstruction and maintenance policies; 1/ For reference purposes consultants may use "Measurement of Pavement Deflections in Tropical and Sub-Tropical Climates" by H.R. Smith and C.R. Jones. TRRL Laboratory Report 935 (1980).  - 52 - ANNEX 2 Page 3 (viii) establishment of a hierarchy of needs and a proposal for a phased reconstruction of the maintenance program; (ix) economic and engineering feasibility studies of the road sections of the program; and (x) recommendations. Phase II 5. Following agreement between the Government and the Bank, consul- tants should prepare the detailed engineering and bidding documents for sections of roads that need reconstruction or maintenance during the first three years. A. Phase I, Feasibility Study 6. The objectives of the feasibility study are to design a phased reconstruction and maintenance program for the whole paved network and to define the immediate optimum economic solution for each identified road section. The consultants should compare feasible alternatives and: (i) determine the technical characteristics of each section to be reconstructed or maintained; (ii) estimate the cost of executing the immediate and future works; and (iii) evaluate the benefits. 7. The feasibility study will include: (i) Traffic studies. Additional traffic counts and composition and load estimates should be carried out on the selected road sections. The following vehicle types should be used: heavy trucks (greater than 5t load) and buses, light trucks, vans and land rovers, and cars. For each section of road studied, forecasts of traffic shalL be established for each five-year period during the economic life of the proposed investments. The forecasts should be established witl the help of origin-destination surveys of typical users of the existing corridors. (ii) Study of road transport costs. For each technical solution con- sidered, the operating costs for each type of vehicle as well as its evolution during the economic life of the investment will be studied. The costs of routine and periodic maintenance will be included, as well as the costs of reconstruction. The interrela- tionship between traffic, the vehicle operating costs, maintenance costs and the cost of reconstruction will be considered.  - 53 - ANNEX 2 Page 4 (iii) Technical investigations. Consultants should undertake all perti- nent topographic, soils, hydrological and pavement surveys and testing of the performance of the existing pavement to determine all technical characteristics of the identified road sections. Bridges, culverts and ditches will also be examined and the neces- sary repair or reconstruction works defined. The documents neces- sary for the execution of these works will be prepared, including investigations for foundations studies and hydrological surveys for drainage works. The consultants should also give special attention to selecting the materials best adapted for the construc- tion of the subgrade, sub-base, the base and wearing courses. They should identify and carefully evaluate the quality and quantity of materials of the borrow pits and rock quarries within economical hauling distance of the road. They should also, if necessary, carry out soils surveys and identify quarries and borrow pits for road maintenance in the regions where these needs were identified in Phase I. (iv) Economic comparison of the solutions examined. To define the economically most advantageous solution, a comparison will be made of the total transport costs on the road (including all vehicle operating costs) for the economic life of the proposed investment, as well as the costs of investments and maintenance associated with the different solutions considered. The comparison is to determine the optimum technical characteristics as well as the timing of the investment. Normal, generated and diverted (if foreseen) traffic will be separately identified. Other benefits to be quantified are: the savings due to time-savings for the transport of high-value goods, and reduction in spoilage of perishable goods. 8. The various solutions will be compared to a reference solution, which is defined as the continued use of the existing road, on its present alignment, without major improvements and with the appropriate maintenance as required. The economic rate of return and the net present value discounted at 12% will be determined for each solution, as well as the first-year return (comparison of investment costs to benefits the first year after completion). A sensitivity analysis will be performed to account for uncertainty in any of the cost and benefit parameters entering into the calculation. Any possible interdependence among the variables should be considered. 9. The costs to be taken into account are economic costs, i.e., net of taxes and adjusted to reflect the scarcity or surplus of the resource. B. Phase II, Detailed Engineering and Bidding Documents 10. This step will include the preparation of final engineering, cost estimates and bidding documents for the works selected by the Government on the basis of the feasibility studies' recommendations. It will include the final detailed topographic surveys and geotechnical studies to complement the work done during feasibility studies as well as the staking of the road center line and structures with permanent references.  -54- ~ANNEX 2 Page 5 11. The bidding documents will be prepared for international competi- tive bidding with prequalification of contractors, in accordance with the Guidelines for Procurement under World Bank Loans and IDA Credits. The consultants will recommend the grouping of the contract works according to the directives of the Government. 12. As soon as the necessary elements for the detailed definition of the works are shown, the consultants will prepare a prequalification dossier. It will include an invitation to apply for prequalification as well as a brief descriptive notice on the nature of the works. The consultants will also prepare the newspaper announcement and the circulars for informing the embassies and representatives of Bank member countries and Switzerland. 13. The bidding documents shall include: (i) all drawings necessary for pegging the road centerline, surveying cross-sections and grades for construction of sub-grades, base course, ditches, shoulders and the pavement, as well as for all drainage structures and bridges and the associated accessories and equipment; (ii) the general conditions of contract, especially concerning the rules about performance bond, price adjustment formulas, insurance to be provided and advance payments; (iii) the special conditions of contract, including the technical speci- fications and materials and the quality control and measurements procedures; (iv) schedule of unit prices; and (v) the quantity estimate. 14. Consultants should also prepare a confidential report which should comprise the detailed cost estimate, broken down into foreign costs, local costs and taxes. The foreign cost will include, in particular, the following: depreciation of imported equipment, imported materials and supplies, salaries and benefits for expatriate personnel, overheads and profits of the contrac- tor, as well as the main foreign exchange cost of goods produced in Cameroon which are used in the project. 15. Consultants should consider subcontracting some of the geotechnical and pavement investigation to Labogenie to the degree warranted by its capacity and desire to execute these works. During the last year of the project, consultants should train Labogenie-s personnel to continue the work and consultants should transfer the remaining tasks to Labogenie in such a manner that the maintenance program will continue without interruptions.  55 ANNEX 2 Page 6 16. Reporting: 1. Inception Report: (due 6 months after signature of the contract) - should contain observations on visual inspection of the paved road network, detailed program, schedule and cost estimates. The proposed program and costs will be discussed with the Government and Bank and if needed program will be modified following written order of the Government. 2. Feasibility Report: (due two years after signature of the contract) Phase I report. - should contain all measurements, data, observation, analysis and recommendation as described in the Terms of Reference. The draft report is due 21 months after signature of the contract to the Government and the Bank for review and comments. 3. Final Engineering, Bidding Documents, Confidential Report Phase II Report. (due three years after signature of the contract) - should contain all documents and reports specified in the Terms of Reference. Draft documents should be submitted to the Government and the Bank 2.5 years after the signature of the contract for review and comments.  - 56- ANNEX 3 Page 1 UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Outline Terms of Reference and Qualifications of Experts for the Highway Department in the Ministry of Equipment A. Terms of Reference The three experts will assist the Director of the Highway Department in monitoring the construction of the Douala-Yaounde road. The managerial civil engineer will be assigned to the Director-s office and will report to the Director directly. Two other engineers will be assigned to the New Works Division (Sous-Direction des Travaux Neufs) and will report to the managerial engineer through the Sous-Directeur des Travaux Neufs. In particular, they will: 1. assist the Highway Department in management, procurement, budget and financing matters to assure the efficient and rapid execution of the works; 2. assist the Highway Department in supervising consultants and contractors; 3. review technical proposals and decide a course of action; if the cost, environmental or political implications of the proposals are significant, the experts should discuss the proposal with the Director for the purpose of obtaining his approval; 4. monitor contractor's work schedules, construction progress, and evaluation of costs; 5. in a monthly progress report, advise the Government and the financing agencies about work progress, problems and their proposed solutions and the evolution of project costs; 6. prepare and process withdrawal applications; in particular, to be responsible for obtaining all necessary signatures in Cameroon and ensuring that they are sent to the financing agencies within two weeks from the date of signature of the supervising ^onsultants; 7. accept the work of contractors; 8. train Cameroonian counterparts in managerial and supervisory assignments in such a manner that these counterparts can efficiently substitute for the experts at the end of their assignments; and  _ 57 _ ANNEX 3 Page 2 9. make a critical evaluation of the project in a final report to the Government and the financing agencies. This report should contain the history of the project, give specific details about the problems and explain the adopted solutions. It should also give all the relevant cost and benefit data which will help in the evaluation of the project. The experts should submit a draft version of their report three months before their depar- tures. They will finalize their report during the last month of their stay by incorporating the comments of the Government, Bank and other financing agencies who participated in this project. B. Qualifications Three persons having the following qualifications will be required for about four years: 1. Managerial Civil Engineer The expert should be a well-qualified senior engineer with at least ten years professional experience, of which five should be in a managerial position supervising projects exceeding US$100 million. The expert should have broad experience in technical, administrative, scheduling, cost and management matters, and should be fluent in French. 2. Structural Engineer The expert should be a well-qualified engineer with at least five years professional experience in design of structures and supervision of contractors. He should be fluent in French and have some administrative experience. 3. Highway Engineer The expert should be a well-qualified engineer with at least five years professional experience in design of highways and supervision of contractors. He should be fluent in French and have some administrative experience.  - 58- ANNEX 4 Page 1 UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Outline Terms of Reference for the Technical Assistance to the Ministry of Transport General 1. The Government of Cameroon intends to create a Division of Studies and Planning (DSP) in the Ministry of Transport (MINT). DSP will replace the Transport Planning and Coordination Unit which has been in operation since 1978. MINT discussed a tentative work program for the proposed DSP with the Bank and is now formalizing it. The project provides for the continuation and extension of the technical assistance to MINT provided under the Technical Assistance Project and the Third Highway Project which consisted of 54 man- months. 2. Objectives Technical assistance to DSP is expected to help MINT analyze pending issues of the Transport Sector, provide specific recommendations to the Government and, when needed, assist the agencies involved in the transport sector. DSP is expected to become the major policy formulating and planning arm of MINT in the coming years but, owing to the Ministry's limited experience in these fields, technical assistance will be indispensable in DSP's formative years. Major objectives of the technical assistance, among others, would be: (i) analyses of transport development and inter-model transport co- ordination (investment programs in the sector, review of feasibility studies of the different transport projects included in the Fifth Development Plan, rail/road coordination, etc.); (ii) analyses of specific sector issues (review of the transport survey to be compiled by consultants, analyses of road transport costs and of the road transport industry, etc.); (iii) ad hoc recommendations on policy matters (transport tariffs, road transport legislation, airport relocation, etc.); (iv) assistance to the transport sector agencies on occasional basis (issues specific to REGIFERCAM, NPA, Civil Aviation, etc.); (v) training of Cameroonian counterparts (on-the-job training for DSP staff, brief seminars/workshops sessions for staff in the transport sector agencies on an ad hoc basis);  - 59 - ANNEX 4 Page 2 (vi) data collection and analysis (creation and continuous updating of a simple data bank for the transport sector to be available to all interested parties). 3. Scope of the Technical Assistance The Fifth Highway Project will provide for about 84 man-months of assistance to DSP. It will be distributed as follows: (i) Senior Transport Economist (about 36 man-months) will be respon- sible for making DSP fully operational and advising MOT and the Government on relevant transport issues and policy matters related to the sector as mentioned in para. 2. He will be responsible for training Cameroonian staff and making preparations for the conduct of the transport survey to be carried out by consultants; three months after his arrival, he will prepare a detailed work program for the following year and an indicative program for the subsequent two years. He will have extensive background in transport planning and coordination of all modes as well as extensive experience in development planning in developing countries, including Africa. (ii) Transport Economist (about 24 months) will coordinate his work with the Senior Transport Economist and assist him in executing the agreed work program. He will be responsible for training the assigned Cameroonian counterpart to execute items (i) and (ii) and will liaise on a regular basis with the Road Planning Unit in the Ministry of Equipment; he will have at least five years of experience in transport planning in developing countries and possess a good knowledge of statistics and transport modelling. (iii) Short-term Specialists (about 24 months) The Senior Transport Economist, in consultation with the head of DSP and the Secretary General of MOT, will determine the need and timing of the arrival of short-term specialists in Cameroon and prepare and clear with the Bank specific terms of reference for each of their assignments. 4. Services and Facilities to Be Provided by MINT (i) MINT will provide two suitably qualified counterparts to work exclu- sively with the Senior Transport Economist and one suitably qualified counterpart to work with the Transport Economist. Additionally, MINT will appoint a competent head who will work in close coordination with the Senior Transport Economist. MINT will also ensure that the Technical Assistants have real access to all Government authorities and available data relevant to their services. (ii) MINT will provide adequate transport, office and secretarial facili- ties for the efficient utilization of services to be provided by the technical assistance.  - 60 - ANNEX 4 Page 3 5. Schedule of Reports The Senior Transport Economist will be responsible for submitting the following reports to the Minister of Transport (through the Secretary General) and the Bank (2 copies): (i) a detailed annual work program three months after his arrival in Cameroon, and quarterly progress reports describing in detail the work accomplished during the quarter and a revised work program for the following quarter; (ii) individual reports for members of the technical assistance team and short-term specialists at the end of their assignments; (iii) a draft final report at the completion of the technical assistance work and a final report one month after receipt of comments; and (iv) other reports as may be requested by the Secretary General of MINT.  - 61 - ANNEX 5 Page 1 UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Outline Terms of Reference and Qualifications of Experts for Labogenie, the National Civil Works Laboratory A. Terms of Reference Four experts will assist the Director of Labogenie to work out a viable laboratory development program and to implement it. The experts' primary responsibility is to develop Labogenie's capacity to provide effective laboratory support to the construction of the Douala-Yaounde Road. At the Director's written request, the experts may also advise Labogenie concerning other programs ranging from exploratory drilling and field measurements and laboratory works related to building and road construction studies and mainte- nance of paved and laterite roads. In particular, the team will consist of: 1. A managerial civil engineer, specialized in geotechnical engineering, will be assigned to the Director's office as an adviser for three years. He will be responsible for designing and scheduling the development program and supervising its implementation. He will schedule the arrival of the other three experts and will supervise their work. He will review: - the training requirements of the existing laboratory personnel and make recommendations to the Director during the first year of his assignment; - the personnel management policies of the laboratory, and needs in qualified personnel; - the activity areas of the laboratory and the equipment require- ments to support these activities. He will: - improve the efficiency and quality of the laboratory and field work; - select personnel and establish teams, schedule and supervise their field and laboratory work and give specific, detailed instructions for carrying out their work; - submit a status report, plans and recommendations to the Director and the Bank at the end of each year of his assignment. The Government and the Bank will discuss these reports and the Director will advise the expert in writing on the approval, modification, or rejection of the proposed plans and recommendations.  - 62 - ANNEX 5 Page 2 2. A field exploratory equipment specialist will plan and supervise the field geotechnical exploratory program for two years. He will: - review the personnel and equipment requirements of the teams; - train personnel in specific tasks; - process the procurement of laboratory and field equipment and review delivery and acceptance tests; - plan, schedule and execute field exploratory and laboratory testing programs; - interpret results and findings; - write reports; and - train personnel in interpretation techniques and in report writing. 3. A senior laboratory technician will plan and implement a laboratory testing program and be responsible for the related procurement matters for three years. He will: - review equipment needs; - review personnel requirements; - devise, schedule and supervise an upgrading training program for laboratory personnel; - provide on-the-job training for laboratory personnel; - develop job descriptions for each laboratory technician and give them specific instructions to carry out their work; - implement the training expert's recommendations; and - process the procurement and review the delivery and acceptance tests. 4. A training expert will design and implement a training program for one year. He will: review and evaluate the qualifications and skills of laboratory personnel; define training needs and plan a training program;  - 63 - ANNEX 5 Page 3 during the fourth month of his assignment, he will present a status report, detailed plan and schedule of implementation of a training program. Following the review of the report by the Bank, the expert will implement the approved program; train a Cameroonian training officer; and gradually phase out his program by handing over all his respon- sibilities to the other experts and the Cameroonian training officer. B. Qualifications 1. Managerial Civil Engineer The expert should be a well-qualified senior engineer with at least ten years' professional experience of which five should be in a managerial position in a civil works laboratory. The expert should have broad experience in all laboratory and field exploratory works, administrative, management and scheduling matters. The expert should be fluent in French and demonstrate some experience in developing countries. 2. Drilling Master The expert should be a well-qualified technician knowledgeable in field exploratory equipment and techniques. The expert should have three years' experience in charge of exploratory work programs. He should be fluent in French and demonstrate training and report writing capabilities. 3. Senior Laboratory Technician The expert should be a well-qualified technician knowledgeable in laboratory equipment and be familiar with indoor testing techniques. The expert should have five years' experience in charge of laboratory work. He should be fluent in French and demonstrate training and report writing capabilities. 4. Training Expert The expert should be a well-qualified civil engineer with five years of training experience. He should be fluent in French and have some experience in developing countries.  I I  I B R 0 15470 -~~~~~~~~~~ 5' ~~~~~~~~~~~~~~~~~JANUARY lgel0 M A LI A /T,,0h o~oo4k -, V ~~~~~~~~~~~~~~~~A - - ~ WI ' 0. / .CENTRAL A RICAN 1O ,, CAMEROONN r"2 "C'"~~~~~~~~~~~~ /CONGO~ Z AIR E i:.ooc I'IIII <'GABON ( 0', / fBto'' UNITED REPUBLIC OF CAMEROON FIFTH HIGHWAY PROJECT Rood under construCtionI 10' Rools zonAtruciaO under K National o 0 40I O 00 ~ 100 120 14014 F0g0 Looooved Roads, KILOMETERS to 00 Ia nol ~ ~ ~ ~ ~ ~ ~ ~ ~ 0--~o IF U