Central African Empire - Third Highway Project

-D-cment of The World Bank FOR OFFICIAL USE ONLY RePort N*. 5037 PROJECT COMPIETION REPORT CENTRAL AFRICAN REPUBLIC THIRD HIGHWAY PROJECT CREDIT 847 AND CREDIT 1074 (SUPPLEMENr) April 16, 1984 Western Africa Region Transportation Division II This doment hss a restrcted distributioen ad may be used by reipents only in the pefonnance of their offidl dties It cutents may not otherwise be disclod withbot Wold Bak aothorition.  FOR OFFICIAL USE ONLY CENTRAL AFRICAN REPUBLIC PROJECT COMPLETION REPORT * .................... THIRD HIGHWAY PROJECT Table of Contents Page PREFACE ~~~~~~~~~~~~~~~(i) I P NREFACTIO......... *..a ............. ........ ................ 1 BASIC DATA SHFRT ....a...ioi...)..... o ..... HIGHLIGHT . .......T..... ... .... iiii)... I. IN TRODUCTION ....1.... -o..oo...* .......o II. THE SECTOR .......................... 2 III. PROJECT FORNTJLATION... . .............. o......... 4 IV. ION ....oN E .........O .. 6 V. ECONOMIC REEVALUATION................. o 9 IV. INSTITUTIONAL DEVELOPMENT......................... *o ... 11 VII. PERFORMANCE OF THE BANK AND BOERRO.ER t 11 VIII. IMPACT OF PROJECT...... 12 IX. CONCLUSIONS . 12 Tables 1. Contract Awards 2. Forecast and Actual Cost 3. Actual vs. Estimated Average Daily Traffic Volumes 4. Actual vs. Estimated Vehicle Operating Costs Annex 1 Borrower's Comments on the PCR | This document has a restricted distribution and may be usd by recipients only in the performance of their official duties. Its contents may not otherwise be discloed without World Bank authorizationt , ~~~~~~~~~  (i) CENTRAL AFRICAN REPUBLIC PROJECT COMPLETION REPORT TFIRD HIGHWAY PROJECT - CR. 874 & 1074 CA PREFACE 1. This Project Completion Report reviews the performance of the Third Highway Project for vhich Credit CA-874 and CA-1074 (Supplementary) in the amounts of USS15.5 million and SDR 3.5million (US$4.5 million equivalent) were made in November 1978 and December, 1980 respectively. 2. This report, prepared by the Vest Africa Region, is based on revievs of the project files, correspondence with the Borrower and examination of the transcripts of discussions concerning negotiations and board presentation. 3. In accordance with the revised procedures for project performance audit reporting, this Project Completion Report was read by the Operations Evaluation Department (OED) but the project was not audited by OED staff. The draft report was sent to the Borrower for comments; their reply is shown as Annex 1. .  BASIC DATA SHET fijact cows cU$ inus) no.? 31.0 d1 mt moment (us J 4/d Ua atnus) 15.5 1SWU3 AV _tlsead _54 _JS3.3 btu phyicl cui.aus cupltu 61 - 6161 me d of m ) 12 1U SinLastis latIettd and Actual W*bWeammat IpmsaaI saUms 4.50 940 34.00 19.30 I3.3d' Actual 139 32.14 3U."0 la.3 1941 *ctulsaZfes_nt. 31 1* 113 - 33 300 USt a Ctbaa1b ectma as 2 of a 31 in ILI At- a t Plea baIgvisa IBtluaitad AcemalL amelteFts Ia Ok 1111 137 3/7 maraziCsd:apptal 9/513/ . 15733222 !ffaeaiw s "ea 4/4113 4/4/7 10/W21U CLaaIa dam A32/f 06/8303 twenties Agony Afram" tupablisbul - -m, 7 Uzeetlas lintel. de_ _ bea Crate I4 Cr 1125-CA_ sea"rd kee.satias QWU/3 bans301. li.) I 10.3 mull". CUSS13.O millie. oquVIvema bula.o Numbr er bof of im ft ftrw F_"X ttin Oas .bkeba2 ?u,seUaa1324.73 YasaIy bamsulsIa nisa 12/51 Jffea1aa1 2/76. &M77 417 3 2 131116 S.a.ia - 106 2 1 111&676 Sugmuwiasae U2 61193 1 3 7/26/79 Iepa,vilaat 332 2/30 a 1 4130/3 lupwwiaisea IT 10160 I a 11/30/3 SuparvIslom 1 06161 a 3228 Al 5411 G.zZ ILloam uadisbvrma so at 12J:5J53. 315.5 aiuhI.. cdig pi" dul equlalnat, at pnca at SOR 3.5 Iidbe Peter ce.v_ bpar wa pafpad wit.n m Flo mnlmem.  (iii) CENTRAL AFRICAN REPUBLIC PROJECT COMPLETION REPORT THIRD HIGHWAY PROJECT - CR. B74 & 1074-CA HIGHLIGHTS 1. The project provided a total of US$ 20 million to help finance construction of the 145 km Bangui - Bossembele road and related consulting services. The Bangui - Bossembele road is the first part of the principal overland route via Garoua - Boulai on tne frontier with Cameroon and thence to the port of Douala. The Kuwait Fund provided US$3.6 million equivalent and the African Development Fund US$5.6 million equivalent to co-finance the road. The project was fully successful and the economic rate of return of 13% was about the same as the originally estimated 12%. The higher than expected truck traffic on the completed road offset the 21% increase in the project cost which resulted from additional work, higher than estimated inflation and currency realignments. A Supplementary Credit of SDR 3.5 million provided by the Association and a Kuwait Fund loan of US$1.8 million defrayed the project cost increase. 2. In association with the project, a program to rehabilitate the remaining part of the overland route from Bossembele to Garoua - Boulai on the frontier with Cameroon and thence to Douala was financed by the European Development Fund (EDF), French (FAC) and German (GTZ) bilateral agencies. The co-donors program was successful. 3. The following points may be of particular interest: (i) the understanding between the Association, EDF, FAC and GTZ, concerning the need and extent of road improvement (paras. 2.06 - 2.09); (ii) increase.in cost estimate and inclusion of co-donors in the project (para. 3.05); (iii) difficulties encountered in procurement, design and construction of the I'Bali bridge (paras. 4.05 - 4.06); (iv) success of the Road Fund (para. 4.10); and (v) institutional aspects (paras. 6.01-6.02).  CENTRAL AFRICAN REPUBLIC PROJECT COMPLETION REPORT THIRD HIGHWAY PROJECT - CR. 847/1074 CA I. INTRODUCTION 1.01 The project was the third financed by the Bank Group in the road sector of the landlocked Central African Republic (CAR). The first (Credit 146-CA, US$4.2 million, 1969), financed the paving and reconstruction of the Bangui-M'Baiki road (98 km) in 1972. The second (Credit 199-CA, US$4.3 million, 1970), financed equipment, material and technical assistance for a four-year highway maintenance program, which mainly because the Government was unable to provide local funds for recurrent maintenance was completed in a substantially reduced form early in 1975. 1.02 CAR with an area of about 620,000 km2 lies mostly on a high rolling plateau, which presents no geographical obstacles to transport. The country is landlocked and transport costs to distant ocean ports are high. The population of 2.3 million is concentrated mainly in the south and west of the country, the areas of greatest economic activity. Politico/Economic Situation 1.03 During the 1960s the economy, predominantly in the private sector developed satisfactorily. However in the 1970s growth slowed down and by the mid-1970s, when the Third Highway Project was being prepared, CAR's economy had deteriorated badly. It was affected by the drought in West Africa, and there was a significant decline in the quality of Government Administration. Cotton production was down 50%; output of the nationalized coffee plantations was reduced drastically; and the infant manufacturing sector was stagnating because inefficient public enterprises were squeezing out private ventures. In September 1979, a year after the Credit was approved, a new regime came to power. At that juncture the commercial agriculture sector had all but disappeared. The civil service was in disarray. Taxes were hardly collected and the Government was virtually bankrupt. Roads had become dilapidated through neglect and were urgently in need of rehabilitation.  -2- II. THE SECTOR 2.01 Most domestic transport is by road. The classified network consists of about 9,000 km of which about 450 km are paved. The larger unclassified network (about 11,000 km) consists mainly of seasonal secondary roads and unengineered tracks. Most trunk roads radiate from Bangui, the capital. The road network is generally adequate in extent and serves the populated areas. However at project preparation roads had deteriorated due to inadequate maintenance. 2.02 The country's primary access to the sea is the historic road/river/rail route south to the port of Pointe Noire (Congo). To reach Pointe Noire from Bangui (1,810 km) goods must travel 1,300 km by the Oubangui and Congo rivers to Brazzaville and then 510 km by rail. This route carries 90% of CAR's 200,000 tons annual freight but is only navigable eight months of the year. The alternative route via Cameroon is shorter and consists of the road from Bangui to Garoua-Boulai on the frontier from where it goes to N'Gaoundal (850 km). This is part of the Trans-African Highway. From N'Gaoundal most of the traffic goes by rail to Douala (830 km). The less expensive river route is attractive for the transport of bulk commodities, whereas the Cameroon route is attractive for higher value commodities and small shipments. 2.03 The draft 5-year plan for transport (1976-80) gave highest priority to improving the CAR section of the Cameroon route. The project provided for the rehabilitation of the fV-st section, the 145 km Bossembele-Bangui stretch. 2.04 The Directorate General of Public Works (DGPW) is responsible for the highway sector, and its Planning and Construction Directorate handles design of minor road works and small bridges. Traditionally, major projects are designed by foreign consultants. Road maintenance is the responsibility of DGPW through its two divisions and eight subdivisions. 2.05 Societe Centrafricaine des Transports Fluviaux (SOCATRAF), a mixed enterprise, is now responsible for freight and passenger transport on CAR's waterways. It has suceeded the state enterprise, Agence Centrafricaine des Transports Fluviales (ACCF) which was formed in 1970. ACCF by 1975 was deeply in debt due to a combination of poor management and organization, lack of qualified local staff, and declining traffic. ACCF has now become the holding company (para. 4.12). 2.06 In view of the inadequate road maintenance, the Association advised the Government in May 1976 that the financing of the proposed project would be contingent on the Government's establishment of a road maintenance program supported by foreign financial and technical assistance. The Government acquiesed, and after discussions and negotiations over a long period signed agreements on specific programs  -3- with FED and FAC in April/May 1978, and GTZ (Federal Republic of Germany) somewhat later. 1/ 2.07 FED assistance also included continuation of the existing training school, re-oriented to highway maintenance. FED assistance to the program was to total CFAF 1.2 billion (US$5.0 million) and included the provision of expertise to direct the donors maintenance program. The overall amount of the co-donors programs was about US$6.9 million. 2.08 In conjunction with the program, assistance was to be provided, beginning 1978, to enable the Government to mobilize its idle maintenance organization to do routine maintenance operations on the priority road network, using its field staff of "cantonniers" and existing equipment. For this purpose, the Government itself was to allocate CFAF 500 million (US$2.0 million) in 1978 and at least the same amount annually for the following three years to a special Road Fund account managed by DGPV. Independently of this, the Government was to have consultants make a highway maintenance study in 1977-78. 2.09 The arrangements whereby the Association-financed road was to be done by contractor and the maintenance program of the other donors done under their direct supervision was evidence of the concern over the capability of the Government, and Government institutions, to execute the program in the prevailing state of affairs of the country. In addition to this direct intervention of the donors the maintenance program was made as simple as possible. 2.10 When the political climate became more favorable in 1979, further assistance was quickly provided to the road sector. The cotton crop, the country's most important source of foreign exchange, had been declining for some years. FAC and CCCE (Caisse Centrale de Cooperation Economique), France's development bank, which had been involved in the financing of the cotton sector, mobilized a program to improve trunk and access roads in the country's main cotton growing area in the southeast. Under the program some 1,700 km of roads were rehabilitated by contractors at a cost of US$4.5 million. The rehabilitation was light, involving some grading, ditching, removal of vegetation, light lateritic coverage and the provision of essential turnouts. The rehabilitation of the cotton roads enabled the cotton crop to be salvaged that year. The Association has included in the preparation of the Fourth Highway Project, Cr. 1150-CA, provision to continue and consolidate the road rehabilitation effort in the cotton growing area. 1/ Subsequently Japan provided some equipment, but not funds for operating costs.  -4- III. PROJECT FORNULATION 3.01 The project comprised: (a) reconstruction of the Bangui-Bossembele road (145 km) to two-lane bituminous sealed standard, including the construction of a two-lane bridge on a modified alignment (to that of the existing one-lane bridge) at the M'Bali river crossing; and (b) consultant services for laboratory work related to construction and for prequalification of contractors and evaluation of bids. Chronology of Effectiveness 3.02 General The project was identified under the Second Highway Project, which financed the feasibility study and detailed engineering for reconstruction of the Bangui-Bossembele road (145 km). The study was prepared in June 1972; detailed engineering completed in October 1975 and an updated economic analysis in February 1976. Negotiations took place in November 1977. There were no major issues. It was agreed, however, that Board presentation would be contingent on signing of maintenance agreements with European donors and receipt and evaluation of bids for the road works; the latter because there were no major civil works executed in recent years and it was difficult to make reliable cost estimates. 3.03 Bidding Procedures Following ICB, bids were received before Board presentation in order to have realistic cost estimates. The original plan was to let all road works as one lot. Contractors were prequalified in April 1976 on this basis. The Government, however, in May 1976, requested that the new bridge for the M'Bali crossing should be separated from the other works to enable local contractors to bid. Eventually, the Association agreed, subject to prequalification of local contractors. DGPW employed consultants to complete detailed engineering and bidding documents and to prequalify contractors and evaluate bids. Ten firms were prequalifed to bid on both the road works and the bridge. Two local firms were prequalified for the bridgeworks. Bids, invited in Novenber 1977 were received and opened in April 1978. (Four firms submitted bids for the roadworks and three, including one local firm, for zhe bridgeworks.) 3.04 Effectiveness Satisfactory road maintenance agreements having been reached with the FED and FAC and the bids received in April 1978, the Board approved the project on September 5, 1978. It became effective on April 4, 1979.  -5- Cost Estimate and Financing 3.05 The estimated project cost was US$25.7 million equivalent net of taxes including contingencies ($22.4 million or 87% foreign and $3.3 million local). The Government exempted the construction contract of taxes and duties, estimated at $3.6 million. The Association financed 100% of foreign and 55% of local costs for the supervrision of civil works (laboratory services), and 100% of consulting services which were completed before the Credit was approved and financed retroactively in an amount of US$140,000. In retrospect, the Association's insistence on presenting the project to the Board only after receipt of bids was appropriate considering the substantial revision of initial appraisal cost estimates (based on the consultants' estimates made in 1975) from US$18.5 million to US$25.7 million. With the increase to US$25.7 million, other donors were needed. The Kuwait Fund agreed to provide US$3.6 million equivalent to finance a share of the foreign exchange cost of the road. The African Development Fund (ADF) agreed to provide US$5.6 million to finance foreign and local costs of the road jointly with the Association. 3.06 The table below summarizes the final financing arrangement: Foreign Local Total