Rwanda - Second Water Supply Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 6602-RW STAFF APPRAISAL REPORT RWANDA SECOND WATER SUPPLY PROJECT March 31, 1987 Regional Project Department Eastern and Southern Africa Regional Office This document has a restricted distribution and may be used by recipients only in the performance of their oficial duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS Currency Unit - Rwandese Franc (FRw) US $1.00 - FRw 84 FRw 100 = $1.19 WEIGHT AND MEASURES Metric British/US Equivalents 1 meter (m) = 3.3 feet 1 hectare (ha) = 2.47 acres I are (100m2) = 0/02 acre 1 kilomenter (km) - 0.62 mile 1 square kilometer (km2) - 0.39 square mile (sq. m.) 1 kilogram (kg) = 2.2 pounds (lb) 1 liter (1) = 0.26 US gallon (gal.) 1 metric ton (m ton) =2204 (lb.) GLOSSARY OF ABBREVIATIONS AfDB - African Development Bank AfDF - African Development Fund AIDR - Association Internationale de Developpement Rural BADEA - Banque Arabe pour le Developpement Econonique en Afrique BNR - Banque Nationale du Rwanda CCCE - Caisse Centrale de Cooperation Economique CDF - Comwunal Development Fund CIC - Interministerial Coordination Committee COFORWA - Compagnons Fontainiers du Rwanda ELECTROGAZ - National Water and Electricity Company FAO - Food and Agriculture Organization FRw - Rwandese Franc GDW - General Directorate of Water GTZ - Deutsche Gesellschaft fur Technische Zusammenarbeit GOR - Government of Rwanda MPWE - Ministry of Public Works and Energy NFRWS - National Fund for Rural Water Supply NGO - Non-governmental Organization SNV - Netherlands Volunteer Service UMUGANDA - Compulsory Community Labor UNDP - United Nations Development Program UNICEF - United Nations Children's Fund  _; FOR OfMCIAL UU ONLY RWANDA SECOND WATER SUPPLY PROJECT STAFF APPRAISAL REPORT Table of Contents I. THE SECTOR Country Background ....................... . I Water Resources 2.oo.oo...o......o...oo.......o......o...s...oo.2 Sector Organization . Levels of Service 0 Sector Objectives ................ Sector Development 4 Sector Constraints 0 Previous Bank Involvement . It. POPULATION, WATER SUPPLY SERVICE AND DE4AND IN THE PROJECT AREA Project Area **. o..oo.o............... 00000000900.00,.o.0.o00.6 Population .{ . ooo. o.o.. ..... . ..........*.. 000000 0 0 0.00.00.00.0..6 Level of Service . ....000000000060000090000*000000........... 0.6 Existing Water Supply 6 Water Consumption and Demand oo6ooooo.oooo Rationale for Bank Participation ......oo.oo..o...oo...o...... o7 1II. THE PROJECT Genesis o00ooo000o0o000o0.0o0.......00*0.60,00....... 0.00.0.0.0.0.8 Project Objectives 8 Project Description 9 Project Cost .0..0..00...0.9..000000, 10 Project Cost Summary 00 Project Financing Plan 12 Implementation 13 Procurement ..........,.14 Disbursement 10 IV. THE BENEFICIARIES Introduction 1. . . . . . . . 17 The Communes .......................... 17 Organization 17 General Directorate of Water 09 Organization 1. Finance 20 Staffing 2. Technical Assistance 20 Training .0 000000000000.....0......, 21 Iustitutional Arrangements 22 Implemetation........................... ,....... ,00,.022 Operation and Maintenatnce 02 This document has a retwicted distribution and may be used by recipients only in the poffonmnce| of their of Eiel duties. Its contents may not otherwise be diaclsed without World Bank authoftiogtn.  -il- V. FINANCIAL A1ALYSIS Introduction .. ............ ., , ,, ,, 24 National Fund for Rural Water Supply ..........................24 Assets , .*.o.o000oo 00000o0ooo00000o0o0000*000000o000.0. ,, ,25 Demand Projections o.................... .............*,,o,oo,.25 Cost Estimates 26. oo.....oo ...o0000oo0oo... .o....o. oo....o026 Tariffs *o.ooo.oo.oo 00000000 0000000oo0oo *oooooo**o00000 .26 Renewal Costs ,*o .o...... o..o...o....oo..ooo.*oo.. 000.00.0.27 VI. ECONOMIC AND SOCIAL ANAYLYSIS Project Benefits *ooooeooooo.oooooooo.*6**oo00o000000oo00o.0o.028 Affordability ,28o.oo*o.*.ooo ooooo*, 000000000000000000028 Project Justification o.................0......................30 Least Cost Solution .................oo. ...oo..o.o*.*.*.*oo.oo30 Environmental Impact *30.o..oso....oo.3 Women's Role o....o.oo..ooo....................o* **, *.*.o.ooo30 Impact on Poverty Group 310 0000*3o**..*o o** **1*.0000000031 Project Risks ...............ooo..o.oo.o.,.oo.oo...o..o.oo..oo.31 Monitoring 32....oo..oooo.............os.....o.o.o.ooo...oo..oo32 VII* AGREEMENTS REACHED AND RECOMMENDATIONS Agreements reached 33.oooo.oo.oo.......ooo......o.ooo..........33 Conditions of Credit Effectiveness ............................*34 LIST OF ANNEXES Annex 1: Morbidity and Mortality Rateso..........................*35 Annex 2: Existing Rural Water Supply Systems**o..................o36 Annex 3: Government's Policy for the Rural Water Supply Sector....38 Annex 4: Fourth Development Planoooooooo..oo.oo.......o......o.o.o40 Annex 5: Rural Population in 1984oooooo.oo.oo.oo.oooooo...ooo...oo41 Annex 6: Population sdrved in 1984 by Protected Springs, Gravity systems aid systems with pumpingo.o.oo....o........oo.ooo42 Annex 7: Level of Service in the Lava Region*oo*.,.o.ooo.ooo.o....44 Annex 8: Detailed Cost Estimateso.o.oo.oo.oo................... ,o45 Annex 9: Implementation Scheduleoo.oo..oooooo.ooooo....ooo..o.o...48 Annex 10: Estimated Schedule of Disbursements.o.ooo.........oo...o.49 Annex 11: Organization chart of GDW.....o.o.o..oooooooo.ooooooo...50 Annex 12: Annual Budget Allocations of GDW in FRwv..oo........o....51 Annex 13: Rwanda Second Water Supply Technical Assistance. ..ooo...52 Annex 14: Project Unit Job Descriptions............................55 Annex 15: Outline of Training Program.oooooo.oooooooooo...ooooooo..58 Annex 16: Institutional Arrangements.............................e.65 Annex 17: Population Projections, Lava Region..oo.,oo...............7 Annex 18: Water Consumption for the Project, Lava Region..o........68  Annex 19s Financial Forecasts 1992-2000, Lava Region West, Intercommunal Authority ...... oo.......o 0 .0.00.0.........69 Annex 20: Communal Revenues and Costs 1992, Lava Region West.......*71 Annex 21: Assets and Renewal Provisions 1992-2000, Lava West ...... 73 Annex 22: Lending Conditions .............. 000o*00000000000 0.00.0.75 Annex 23: Assumptions for Financial Projections ....................76 Annex 24: Selected Documents and Data Available in the Project File77 This report is based on the findings of an appraisal mission which visited Rwanda in September 1986. The mission consisted of Messrs. G. Tenaille (IDA), F. Dents and J. Doolan (Consultants). Mr. M. Benouahi (IDA) assisted with the preparation of financial projections.  -iv- RWAINDA Second Water Supply Project Credit and Project Summary Borrower: Republic of Rwanda Beneficiary: Ministry of Public Works and Energy Amount: SDR 11.9 million (U.S. $15.0 million equivalent) Terms: Standard IDA terms Project Objectives: The main objectives of the project would be (a) to improve the quality and quantity of water provided to the rural population, thereby improving public health and the living conditions of women and children who often must walk long distances to carry water; (b) to strengthen institutional arrangements and introduce cost recovery measures for the rural water supply sector; and (c) to increase the responsibility of local communities in the maintenance and management of water supply facilities. Project Description: (a) Rehabilitation and extension of rural aqueducts in the Lava region; (b) establishment and implementation of a national program for rehabilitation, operation and maintenance of rural water supply systems throughout the country; and (c) strengthening of the General Directorate of Water (GDW) as well as the communes and the users associations through the provision of expertise, vehicles, equipment and training. Benefits: The major benefit of the proposed project would be the availability of safe potable water for about 500,000 persons living in scattered rural settlements, and an improvement of their health. The project would also foster the development of communal responsibility for infrastructure serving the population directly and result in considerable improvements in the planning, implementation, and supervision of rural water programs at the country level. Risks: The major risks concern the maintenance of the systems. Experience in Africa has shown that the most promising results are derived from delegating responsibility to the village level and fostering the sense of communal ownership, while providing adequate back-up services and tehnical assistance. Questions still remain whether the beneficiaries can be sufficiently motivated over a long tive to make the necessary monetary outlays, and to join into ccmmunal efforts to maintain and repair the system. The planned demonstration campaigns as well as the efforts to sensitize local leaders and administrators should help minimize this risk.  Project Cost Summary US$ million ILo.al Foreign Total I a. LAVA REGION CONPONENT - ----- Production Civil Vorks I 1.690 2.603 4.293 1 Equipsent 1 0.907 4.002 4.909 1 Sub-total 2.597 6.605 9.202 1 : I Transmission and distribution Pipe supply 1 0.634 12.444 13.079 1 Reservoir Equipment 1 0.076 0.191 0.267 1 Sub-total 0.710 12.635 13.345 : Pipe laying 9.615 4.409 14.024 1 Civil Morks 1 0.976 1.503 2.479 1 Housing I 0.092 0.142 0.234 Sub-total 1 10.683 6.054 16.737 1 Total 1 11.393 18.689 30.082 : TOTAL a 1 13.990 25.294 39.284 1 b. CONSTRUCTION SUPERVISION I 0.942 2.042 2.884 1 c. REHABILITATION PROGRAMI 4.200 7.800 12.000 1 d. STRENGTHENING OF 8DM 1 I Equipment 1 0.040 0.534 0.574 1 Technical Assistance 0.357 0.519 0.876 Training 1 0.404 0.890 1.294 1 Project Unit 1 0.877 1.170 2.047 1 TOTAL d 1 1.678 3.113 4.791 TOTAL BASE COSTS 20.710 38.249 58.959 Physical Contingencies 1 2.099 3.794 5.EC3 Price Contingencies 1 3.957 3.392 7.350 i TOTAL PROJECT COST I 2S.766 45.436 72.201 1 5:x=3Xa 5XXa S=  -vi- Financing Plan US$ Million Government 3.90 Communes 1.55 IDA 15.00 CCCE 16.00 BADEA 7.25 Austria 7.00 Switzerland 8.30 UNDP 0.70 AIDF 12.50 TOTAL 72.20 Estimated Disbursement: IDA Fiscal Year: FY88 FY89 FY90 FY91 FY92 FY93 FY94 FY95 Annual 1.05 2.40 3.30 2.85 2.20 1.50 1.20 0.45 Cummulative 1.05 3.45 6.75 9.65 11.85 13.35 14.55 15.00 Economic Rate of Return: Not Applicable Staff Appraisal Report: Rwanda - Second Water Supply Project Report No. 6602-RW IBRD 20081  I * THE SECTOR Country Background 1.01 Rwanda is a small landlocked country which depends on Uganda, Kenya and Tanzania for its access to the sea. With an area of 26,338 square kilometers and a population of 6.0 million people, Rwanda is the most densely populated country in Africa:228 per Km2 but 400 per 1km2 of usable land. Only 5% of the population lives in urban areas. Smallholder, rainfed agriculture is the predominent feature of the rural sector. There are about one million smallholdings. Population pressure has resulted in diminishing farm size with more than half of the farm families occupying less t1an I ha and another 30X between 1 and 2 ha. The population is increasing at a rate of 3.7% per annum, Life expectancy at birth is estimated at 47 and infant mortality at 137/1000o 1.02 GNP per capita estimated at US$290 in 1985 is among the lowest in the world. Average annual rural family income is about US$550 (US$100 per capita). Limited natural resources, population pressure, scarcity of qualified and experienced manpower, and isolation from main trade routes are the main contributors to the country's poverty. 1.03 The topography is hilly to mountainous with elevation increasing from east to west. The country is characterized by a wide diversity in agro-ecological situations and corresponding farming systems. The western part (Lake Kivu), the central high plateau and the northern volcanic highland areas have the highest agricultural potential. The semi-arid eastern savannah, traditionally a grazing area sparsely populated, is now almost fully settled as a result of the recent control of the tsetse fly and mounting population pressure elsewhere in the country. 1.04 Up to the present, food production seems to have kept face with population growth roughly maintaining national food self-sufficiency. However, national statistics indicate that the growth of agricultural output may be slowing down after a period of relatively strong growth, 5.8% per annum in the period 1974-81. During the period 1981-84, the average annual growth rate is estimated at about 3.5%, less than the population growth rate of 3.7% per annum. Maintaining a general food balance in the future under increasing land constraints will require a major effort to intensify production at the farm level. 1.05 The local administration consists of ten provinces (prefectures) and 143 communes. Each commune is divided into several sectors or "hills" which correspond to the physical hills. There are about 1814 hills in the country.  -2- Water Resources 1.06 Rwanda is a hilly country with good rainfall and two rainy seasons. Rainfall increases with elevation from east to west, from 730 mm to 1,600 mm per year. Because of its geology and climate, there are many springs and sv-face waters in the country, except in the eastern part of the country, where the only resource is ground water, and in the Lava Region, where rainfall Is good but volcanic ground is porous and cannot retain water. Therefore, in the highest part of this region, the population has to walk 10 to 15 kms to find water. Generally, due to a lack of sanitary protection the quality of water provlded by the natural sources is either doubtful (unprotected springs) or really poor (streams, marshlands). This lcuds to water-borne diseases which represent more than 70% of all endemic diseases (see Annex 1). It is estimated that 80% of infant mortality is due to the lack of safe water. Sector Organization 1.07 Initiated under the International Drinking Water Supply and Sanitation Decade, a National Water Supply and Sanitation committee (CNEA) was created in early 1981. It was headed by the Secretary General of the Ministry of Natural Resourcas, Mines and Quarries now within the Ministry of Public Works and Energy, and includes representatives of all the Ministries involved directly or indirectly in the sector. The Committee had only a consultative role. It was to advise the Government on all matters relating to water and sanitation, especially the organization of the sector and the coordination of different activities. Its main achievement had been to inform Government officials of sector needs and constraints, and to study alternatives for reorganization of the rural water supply subsector. The Ministry of Natural Resources was abolished in January 1984 and its responsibilities for water supply were transferred to the Ministry of Public Works and Energy. A new committee was established on October 12, 1984, called the Interministerial Coordination Committee (CIC) for urbanization, housing, water and energy. It is headed by the Minister of Public Works and Energy and includes respresentatives of the ministries of Transport, Agriculture, Health, Education and Finauce. This CIC has to determine sector policies and to oversee their implementation. It has reviewed the Institutional study for rural water supply financed by Credit 1345-RW and approved its recommendations. 1.08 According to the statute (Decret-Loi 18) approved in 1976, the parastatal Electrogaz has exclusive responsibility for water and electricity distribution throughout the country. However, its activity has been more limited, both in practice and according to legislation approved more recently. In practice, Electrogaz serves only Kigali and eleven other urban centers. Its activities are supervised by the Ministry of Public Works and Energy (MPWE). Water supply in strictly rural areas has since January 1984 been under the responsibility of the General Directorate of Water (GDW) of the same Ministry, even though the original statutes of Electrogaz have not been changed. In between are 22 "sous-prefectures with both rural and urban features, the responsibility for which is currently under discussion.  -3- 1.09 Until the creation of GDW, the lack of rural water supply institutions and the absence of financial resources prevented the upgrading of rural water supply facilities and resulted in poor operation and maintenance. A total of 292 rural water supply systems have been constructed (see Annex 2). Many of those constructed by the "Association Internationale de Developpement Rural" (AIDR) were also entrusted to AIDR for operation and maintenance, However, funds allocated yearly to AIDR for operation and maintenance were not increased adequately over the years to compensate for inflation and facilities are In poor condition. AIDR went bankrupt in October 1985. 1.10 The role of GDW is to take over the sector and to implement the new Institutional and cost recovery policy recommended by the institutional study (see para. 1.07) and approved by the Government. Because of Its lack of experience, GDW needs technical assistance and training. GTZ is already committed to provide two experts for two years. PAO would provide a legal expert to prepare a revision of the water legislation and the proposed project would provide two other technical assistants (see para. 4.14). Levels of Service 1.11 About 46% of the urban population is served through private connections (25%) or standpipes (2'%). In rural areas, 16% of the populatiou had access to the 2549 standpipes existing at the end of 1984 and 47.42 is served mainly through springs, which are partially protected, and also through wells. People not served (36.6%) rely on unprotected spriugs and polluted streams and ponds which are at relatively great distances. 1.12 A WHO sprvey showed that 252 of the urban populatiou was served by septic tanks and 35% by pit latrines. Another survey carried out in May-July 1984 showed that 84% of the rural population had access to pit latrines. This percentage is very high and compares to 30% in Burundi. Sector Objectives 1.13 The Government's objectives for rural water supply in the long term are to manage water resources in order to meet the needs of all the population, agriculture, livestock and industry. For the period ef the fourth development plan (1987-1991), the objectives are to put in place the institutioaal and legal framework for a rationalized water management. The necessary decisions were taken by the Government Council on November 15, 1985 (see Annex 3). It was decided, in accordance with the recommendations of the institutions'a study, to give the communes full responsibility for water management, with the participation of users associations. The beneficiary families should cover the full cost of operation, maintenance and renewal of the facilities. Financing for investments would be obtained from the National Fund for Rural Water Supply (NFRWS), to be created as a special account of the existing Communal Development Fuud. 1.14 The Fourth Development Plan (see Annex 4) includes water supply projects for an amount of PRw 11,467 million (US$ 136.5 million) of which PRw 433 million (US$ 5.15 million) is for studies. All of these projects are sound and justified but the program is too ambitious for the  Implementation capacity of the country. Moreover, financing for FRw 1,290 million (US$ 15.36 million) has still to be found. During project Implementation, an updated three year investment program would be submitted by October 31, each vear to IDA for its review and comments, and the Government would ensure that investments in the water supply sector are technically, financially and economically justified. IDA would also be given the opportunity to review and comment GDW's annual budgets for the following fiscal years (see para. 4.12). Sector Development 1.15 In spite of the limited absorptive capacity and the institutional weakness of the sector, several water supply projects are under construction or under preparation. Water systems in Kigali and Butare have recently been developed under a project financed by the African Development Bank (AfDB). IDA is financing a project for five secondary centers and Caisse Centrale de Cooperation Economique (CCCE) for four others. Moreover, AfDB is financing a study called "Kigali 2,000" for a project aimed at meeting the needs of Kigali for the year 2000. 1.16 In rural areas, water supply is being actively developed, mainly by NGOs. COFORWA (Compagnons Fontainiers du Rwanda) has built 93 rural water supply systems and developed an interesting cooperation policy for construction, operation and maintenance. They do not start the works until a users'association, represented by a water committee, is created. The association contributes to the construction and participates in operation and maintenance. The association also participates in decisions about the financial contribution due yearly by every family. The committee is responsible for the collection of this revenue and for its use. Another NGO, SNV (Netherlands Volunteer Service) is also deeply involved in rural water supply. They have built 37 systems and have developed a method to sensitize ne population to the value and use of safe water. Most of the new systems are now managed by users' committees with financial contributions from the beneficiaries. Twenty-six systems are currently being operated by the communes. Sector Constraints 1.17 The main constraints in the water supply sector are the lack of financing for operation and maintenance and the shortage of qualified staff in the ministry responsible for the sector. This results in inadequate planning and project selection, poor supervision and lack of decision making capacity on organizational and cost recovery aspects. 1.18 In the urban water supply sub-sector, the main issue is the low rate of house connections, due to the high cost of the connection and, up to now, the lack of payment facilities. Under the First Water Supply project (Cr. 1345-RW) the Bank has financed 1000 house connections in five secondary centers and arranged with Electrogaz that they be paid for by the customer over a period of several years. Another issue is the amount of arrears accumulated by the Government and the Municipalities. The Credit Agreement of the first project (Cr. 1345-RW) required that the total amount of receivables due from governmental customers not exceed three month's billings. Due to this covenant, negotiations were held between the Government and Electrogaz, and this issue is being resolved.  -5. 1.19 In the rural water supply sub-sector, the bankruptcy of AIDR (see paragraph 1.09) left a vacuum which is difficult to fill. The GDW is still a young and weak institution suffering accutely from a shortage of skilled staff and a lack of resources. (see para. 4.07). Previous Bank Involvement 1.20 The Bank is involved in a first water supply project (Credit 1345-RW of SDR 12.0 million, signed on 7*7.83) to rehabilitate, reinforce and extend the production and distribution facilities for potable water in the five secondary centers of Cyangugu, Kibungo, Kibuye, Ruhengeri and Rwamagana. Implementation of this project is almost completed, ahead of schedule. The project also included the construction of a training center in Kigali, for electricity and water, and the establishment of a training program. In addition, the project included detailed engineering studies for rehabilitation and extension of rural aqueducts in the Lava Region and an institutional study of the rural water supply sub-sector in Rwanda. These studies, now completed, have been reviewed by the Government and the Bank. They are the basis of the proposed project.  -6- II. POPULATION, WATER SUPPLY SERVICE AND DENUID IN THE PROJECT AREA ProJect Area 2.01 The scope of the project extends to all rural areas throughout the country; i.e. in the 143 communes. The main component of the project, the rehabilitation and expansion of water supply in the Lava Region, is located in eleven communeq of two "prgfectures": Gisenyi (Rubavu, Kanama, Rwerere, Mutura-and Karago)and Ruhengeri (Nkuli, Mhkingo, Kinigi, Kigombe, Nkumba and Kidaho) (see Tap no. 20081). The second component of the project, a national program for the rehabilitation and maintenance of rural water supply systems throughout the country will be based on the priority needs of rehabilitating existing rural water supply systems (see para. 3.13). Population 2.02 In 1984, the rural population of Rwanda was 5.531 million. Annex 5 gives the figures for each prefecture with population density and growth. The average annual growth rate is 3.10% per annum in the country, varying from 1.45% in Gikongoro to 4.50X in Kigali prefecture. The growth rate is 2.45% per annum in Ruhengeri prefecture and 3.35X in Gisenyi prefecture. In the Lava Region, the population of the eleven communes involved in the project is estimated at 485,300 inhabitants in 1985 and 688,500 in 1995. Annex 7 shows the population in 1985 and 1995 for every commune. Level of Service 2.03 The percentage of the rural population presently served is 63.4X, of which 47.4% is served by protected springs and 16% by water supply systems (see Annex 6). On average, 36 families are served by a protected spring and 62 by a standpipe (see Annex 6, page 2). The rest of the rural population is served mainly by unprotected springs or has no satisfactory access to safe water. 2.04 In the Lava Region, 60.0% of the population was estimated to have been served in 1985 in the ten communes involved in the project. This percentage should reach 96.7% in 1995, after completion of the project (see Annex 7). If we consider the more limited area covered by the project, the percentage of the population served would be increased from 39.2% in 1985 to 96.3% in 1995. Existing Water Supply 2.05 The rural population of Rwanda is presently served by 12,956 protected springs and 292 water supply systems, of which 243 are gravity systems (97 built by AIDR, 93 by COFORWA and 37 by SNV), 6 gravity systems with treatment (AIDR), 42 systems with pumping (of which 37 were built by AIDR), and 1 system with pumping and treatment(AIDR). These 292 systems provide water through 2,549 standpipes (see Annex 2). Water Consumption and Demand 2.06 A survey carried out in 1984 by the consultants (BCEOM) showed that the average consumption varied from 8 lcd (liters per capita per day) in the rainy season to 12 lcd in the dry season. When distance is  -7- significant (5 to 10 kms.), consumption falls to about 5 lcd, particularly during the rainy season. These figures are far below international standards and should be compared to 20 lcd in other similar countries. Since the project would provide a standpipe within a distance of about 1,000 m for everybody, it is believed that the demand will reach 12 lcd in 1992 when the project is completed and 15 lcd by the year 1995 in the project area. In a household having 5.6 people on average, the demand per family would be 67.2 and 84 liters per day, respectively. All the public institutions such as public buildings, hospitals, schools, etc., would be served by direct connections. Private connections would also be installed under the project. The project would satisfy the water demand up to the year 2,000 for most of the systems. For the remaining systems, additional works, implemented in a second stage from 1995 to 1998, would be needed. Rationale for Bank Participation 2.07 The Bank's objective In the water supply sector is to support the Government's efforts to implement a new sectoral policy aimed at giving the communes full responsibility for water supply in rural areas and establishing a new system of water charges to be collected at the communal level from all beneficiary families to cover operation, maintenance and renewal costs. This policy has been designed by the institutional study financed by the Bank under the first water supply project, and drafted by the Government following many discussions with Bank missions, meetings and a round table on water supply organized by UNDP in January 1986. Due to extensive consultation with other donors, particularly CCCE, this policy i. supported by every donor involved: CCCE, AfDB, BADEA, Austria and Switzerland. The proposed project provides a good opportunity of implementing this new policy throughout the country and the leadership role of IDA ensures that adequate attention will be paid to institutional and cost recovery aspects for the sector as a whole.  -8- III. THE PROJECT Genesis 3.01 The proposed project is the result of a continuing dialogue between the Bank and the Government on the development of the rural water supply sub-sector, and on ways to finance the operation and maintenance of the existing systems. An institutional study, finance' under the First Water Supply Project (Cr. 1345-RW) was completed in December 1985 and was the basis of a round table conference, sponsored by UNDP in Kigali from January 20 to 22, 1986, which provided au opportunity to promote coordination in the sector and to attract cofinancing.Feasibility and final design studies for the Lava Region were also financed by Credit 1345-RW: the final report and draft bidding documents were delivered in February 1986. All bid documents will be finalized by June 30, 1987. 3.02 Moreover, an inventory of rehabilitation requirements for the country as a whole will shortly get urderway, with financing from the Study Fund of the Ministry of Planning. By no later than the date of project effectiveness the study is expected to have identified overall requirements as well as the most urgent needs, which would form a first phase of a country wide rehabilitation program. The framework for implementation of this program has been agreed (see para. 3.13). The communes, assisted by NG0s, would submit a request, including the proposed cost recovery system, for appraisal by GDW. Financing would then be obtained from the National Fund for Rural Water Supply (NFRWS), (see para. 5.03). Project Objectives 3.03 The project objectives are: (a) to strengthen the capacity of GDW and of the communes to perform their functions through detailed functional analyses, manpower development, provision of equipment and the creation of a National Fund for Rural Water Supply (NFRWS) to improve the efficiency of resource flows into the sector; (b) to improve the quality and quantity of water provided to the rural population throughout the country through the establishment of a national water system rehabilitation and maintenance program under the direction of GDW;  -9- (c) to assist with the financing and implementation of the rehabilitation and expansion of five water supply systems in the Lava Region (NorthWest Rwanda.) Project Description 3.04 the proposed project would include the following components: (a) rehabilitation and extension of six water supply systems in the Lava Region, covering an area of about 1000 km2 and serving about 400,000 people in 1992 and 500,000 in 2000: (i) Sebeya and Yungwe-Bikore systems. Treatment Plant 5750 m3/day 2 Reservoirs 1000 i3 1 Reservoir 600 m3 1 Reservoir 400 m3 2 Reservoirs 300 m3 Length of pipes: 60 km Standpipes: about 105 (ii) Mizingo-Mutura system 2 Treatment plants: 1000 m3/day and 250 m3/day Pumping statlon: 1440 m3/day Reservoir 1000 m3 Length of pipes: 40 km Standpipes: about 36 (iii) Mutera system Treatment plant 500 N3/day Pumping station 4320 m3/day (serves also the Cretes system) 1 reservoir 200 m Length of pipes: 50 km Standpipes: about 20 (iv) Upper Mutobo system Treatment plant (already built) 12300 m3/day Pumping Station 2160 m3/day 1 reservoir 2000 m3 Length of pipes: 65 km Standpipes about 66 (v) Lower Mutobo system Treatment plant (already built) 12300 m3/day Reservoir 1500 m3 (already built) Length of pipes 150 km Standpipes about 122  - 10 - (vi) Cretes system Treatment plant (already built) 12300 m3/day Mutobo Pumping station 4,320 m3/day (serves also the Mutera system) Reservoir Mutobo 1,500 m3 Gahira pumping station 2,300 m3/day Muhingo pumping station 1,150 m3/day Reservoir Muhingo 700 m3 Reservoir Gahira 300 m3 Reservoir Gasizi 2,000 m3 Reservoir Kora 700 m3 Reservoir Suza 700 m3 Reservoir Kinigi 300 m3 Length of pipes 135 and 16 km of force mains Standpipes: about 121 (b) Engineering services for construction supervision. (c) establishment of a national program for rehabilitation, operation and maintenance of rural water supply systems and implementation of this program. (d) strengthening of the General Directorate of Water (GDW) as well as the communes and users associations through the provision of expertise,vehicles, equipment and training, in order to implement the new policy for rural water supply. The Lava Region component is shown on Map IBRD no. 20081. Project Cost 3.05 The total cost of the project is estimated at FRW 6,065 million (US$ 72.2 million), of which US$ 45.4 million, or approximately 63%, represents the foreign exchange component. Base cost estimates are expressed in prices as of January 1987. Cost of works were estimated on the basis of consultants' detailed design. Since goods and equipment for project purposes would be imported free of customs duties and internal taxes, base costs are net of tax liabilities. Taxes on locally procured goods (mainly cement and fuel) estimated at 6% of local costs have been Included in the estimate. They amount to FRW 134.9 million (US$ 1.60 million). The cost estimates are detailed in annexe 8, and summarized below:  -ll- Project Cost Susmary : FRo llillion 5 USS million I Percentage! Local Foreign Total 5 Local Foreign Total I of Total 5 a. LAVA RE61ON COMPONENTI ------5-- , . _ Production Civil Works 1 141.960 218.652 360.612 1 1.690 2.603 4.293 1 5.951Z Equipment 5 76.188 336.168 412.356 5 0.907 4.002 4.909 ' 6.80Z1 Sub-total 1 218.148 554.820 772.968 1 2.597 6.605 9.202 1 12.74Xt Transmission and distribution 5 Pipe supply 1 53.256 1045.296 1098.552 1 0.634 12.444 13.078 1 18.11XI Reservoir Equipsent 1 6.384 16.044 22.428 1 0.076 0.191 0.267 1 0.37Z1 Sub-total 1 59.640 1061.340 1120.980 1 0.710 12.635 13.345 1 18.4821 Pipe laying 5 807.660 370.356 1178.016 I 9.615 4.409 14.024 1 19.4221 Civil Works l 81.984 126.252 208.236 1 0.976 1.503 2.479 1 3.4325 Housing 1 7.728 11.928 19.656 l 0.092 0.142 0.234 5 0.32Z1 Sub-total 1 897.372 508.536 1405.908 5 10.683 6.054 16.737 1 23.1821 Total 1 957.012 1569.876 2526.888 1 11.393 18.689 30.082 1 41.6625 - a _ _------ O ----- -- i - TOTAL a 1 1175.160 2124.696 3299.856 1 13.990 25.294 39.284 1 54.4121 b. CONSTRUCTION SUPERVISION 1 70.728 171.528 242.256 5 0.842 2.042 2.884 1 3.9921 c. REHABILITATION PROSRAM 1 352.800 655.200 1008.000 1 4.200 7.800 12.000 1 16.62X1 a---------- ------ ----a---- ---- ---- d. STRENGTHENING OF BOW ' I a a Equipment 1 3.360 44.856 48.216 1 0.040 0.534 0.574 t 0.8021 Technical Assistance : 29.5d8 43.596 73.584 1 0.357 0.519 0.876 1 1.21X1 Training 1 33.936 74.760 108.696 1 0.404 0.8