Cameroon - Second Water Supply Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 9650 PROJECT COMPLETION REPORT REPUBLIC OF CAMEROON SECOND WATER SUPPLY PROJECT (LOAN 1753-CM) JUNE 14, 1991 Occidental and Central Africa Department Infrasttucture Operations 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 The official monetary unit is the CFA franc which is tied to the French franc in the ratio ef 50 CFAF to 1 French franc. During implementation, the average exchange rate nas been US$1 - 415 CFAF. ABBREVIATIONS AND ACRONYMS CCCE - Caisse Centrale de Coopgration Economique (France) CDC - Commonwealth Development Corporation (UK) DCW - Direction Centrale des March4 DEW - Directorate of Energy and Water MINEP - Ministry of Economy and Planning MINMEN - Ministry of Mines and Energy SNEC - Soci6t6 Nationale des Eaux du Cameroun SONEL - Socift6 Nationale d'Electricit4 du Cameroun WHO - World Healtl Organization THE WORLD BANK F OFFICIAL USE ONLY Washington, D.C. 20433 U.S.A. Office of DiectarCeneral Operatins Evaluation June 14, 1991 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on Cameroon - Second Water Surply Project (Loan 1753-CM) Attached, for information, is a copy of a report entitled "Project Completion Report on Cameroon - Second Water Supply Project (Loan 1753-CM)" prepared by the Africa Regional Office. No audit of this project has been made by the Operations Evaluation Department at this time. Attachment 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. FOR OFFICIAL USE ONLY REPUBLIC OF CAWMB0t( SECOND WATER SUPPLY PROJECT (LOAN 1723-C) TABLE OF. CONET Page No. Preface . . . . . . . . . . . . . . . . . . . . . . . . .. Basic Data Sheets . . . . . . . . . . . . . . . . . . . . ii Evaluation Summary . . . . . . . . . . . . . . . . . . . . v 1. INTRODUCTION . &............ . . . . . . . II. PROJECT IDENTIFICATION. PREPARATION AND APPRAISAL . . . . 3 A. Origin. . ............. . . . . . . . 3 B. Project Preparation and Appraisal...... . . . . . 3 C. Negotiations.. ............... . . 4 III. PROJECT IMPLEENTATION. ........... . . . . . . . 4 A. Effectiveness and Covenants. .......... . . . 4 B. Revisions.. ................. . 6 C. Project Implementation Schedule . . . . . . . . . . . 6 D. Procurement . . . . . . . . . . . . . . . . . . . . . 6 E. Project Costs and Disbursements. ........ . . . 7 F. Performance of Consultants and Contractors . . . . . . 8 IV. OPERATING PERFORMANCE........ . . . . . . . . . . . 9 A. Water Produced and Sold. ........... . . . . 9 3. Metered Connections. . .......... . . . . . 9 C. Operation and Maintenance and Productivity . . . . . . 9 V. FINANCIAL PERFORMANCE. . .......... . . . . .10 VI. INSTITUTIONAL DEVELOPMENT AND STAFFING........ . . . 12 VII. PROJECT JUSTIFICATION. . ............ . . . 14 VIII. BANK PER.ORM#JCE, CONCLUSION AND LESSONS LEARNED . . . . . 16 ANNEXES I Detailed Project Description . . . . . . . . . . . . . . . 18 II Project Cost Summary . . . . . . . . . . . . . . . . . . . 20 III Compliance with Covenants . . . . . . . . . . . . . . . . 21 IV Disbursement Schedule . . . . . . . . . . . . . . . . . . 28 V-1 SNEC Income Statements . . . . . . . . . . . . . . . . . . 29 V-2 SNEC Balance sheets . . . . . . . . . . . . . . . . . . . 30 V-3 SNEC Funds Flow Statements . . . . . . . . . . . . . . . . 31 VI-1 Service Level in Douala and Yaoundd . . . . . . . . . . . 32 VI-2 Economic Analysis . . . . . . . . . . . . . . . . . . . . 33 VI-3 Net Incremental Benefits . . . . . . . . . . . . . . . . . 35 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. REPUBLIC OF CAMEROON SECOND WATER SUPPLY PROJECT (LOAN 1753-CM) PROJECT COMPLETION REPORT PREFACE This is the Project Completion Report (PCR) for the Second Water Supply Project in Cameroon, for which Loan 1753-CM in the amount of US$21 million was approved on September 6, 1979. The loan closing date was extended by slightly over two years to September 30, 1986. It was fully disbursed and the last disbursement was on November 5t 1986. The PCR was prepared by the Infrastructure Operations Division, Occidental and Central Africa Department of the Africa Regional Office based on the Staff Appraisal Report, supervision reports, legal documents, project correspondence files and other documents relevant to the project. Following standard procedures, OED sent ccpies of the draft PCR to the Borrower for comments; however, none were received. - iii - REPUBLIC OF CAMERO SECOND WATER SUPPLY PROJECT (LOAN 1753-CM1 PROJECT COMPLETON REP0 T SAIC DATA SHEET KEY PROJECT DATA Appraisal item Estimate Actual TotIl Project Cost (USS millIon) 51.4 /1 53.4 Overrun (S) -- 4.0 Total Project Cost (FCFA million) 11315.0 221860. Overrun (N) -- 96.0/b Loan Amount (USS million) 21.0 21.6 Date Physical Components Completed 66/83 06/88 Proportion Completed by Above Date (%) 76 140 Proportion of Time Overrun (5) -- 75 Economic Rate of Return 7 5 Financial Performance Good Bad Institutional Performance Good Fair CDC Co-finance (UK9 million) 6.75 /c 6.75 OTHER PROJECT DATA item Appraisal Actual Government Application Appraisal 10/78 -- Negotiations 06/79 -- Board Approval 09/8/79 -- Signing Date 12/11/79 -- Effectiveness Date 03/12/80 /d 06/12/81 Closing Date 6/30/84 09/3/86 /g Borrower Government of Cameroon Beneficiary Soci6t6 Nationale des Faux du Cameroun Fiscal Year: Borrower July 61 -- June 3 Seneficiary July 01 -- June 36 /I Based on average exchange rate during implementation of CFAF 416/US81. /b In terms of total costs of the project. Thie percentage Io really 26% when compared to the percentage completed. For explanation see pars. 3.11. /c US815.0 million equivalent. /d The effectiveness date was postponed five timeo by three months each, on avorage. /. Date of lost disbursement. - iv - CUMULATIVE ESTIMATED AND ACTUAL LOAN DISBURSEMENTS (USS million) Item FY80 FY81 FY82 FY83 FY84 FY8S FY88 Estimated 0.5 8.7 9.7 15.7 21.0 0 0 Actual 0 0 0.0 0.9 5.1 10.8 21.0 Actual/Estimated (9) 0 0 6 8 24 61 100 MISSION DATA Number Number Number of Det. of Type of Mission Month/Year of Days of Persons StaffWeeks Report Post-appraisal 01/79 ** -- Supervision 1 09/79 5 1 0.7 10/22/79 Supervision 2 08/80 7-16 8 4.7 05/27/80 Supervision 8 11/80 14 2 4.0 12/22/88 Supervision 4 05/81 4 8 1.7 07/01/81 Supervision 5 12/81 14 3 8.0 02/01/82 Supervision 6 11/82 & 1 0.7 11/19/81 Supervision 7 06/88 6 3 2.8 07/01/88 Supervision 8 03/8 7 8 8.0 06/04/84 Supervision 9 06/64 9 3 3.9 07/80/84 Supervision 10 12/84 7 3 8.0 01/07/85 Supervision 11 11/86 17 3 7.3 01/30/86 Supervision 12 05/88 6 2 1.4 05/28/88 Total number of missions = 13 Total number of staffweeks a 89 COUNTRY EXCHANGE RATE Name of Currency: CFA France Appraisal Year (1979) -- Exchange rate: 0.00455 Intor..Years' Average (1981-88) -- Exchange rate: 0.00241 Final Disbursement Year (1986) -- Exchange rate: 0.00286 EPUBLIC OF CAHRO0N SECO WAT SUPPLY PROJECT (LOAN 1753-C0) NoJECT CmFLRTION REPORT EVALUALTI0B SUIMMRY 1. The project was designed to meet the recamendations of a sector study carried out in 1974 under a BanklWHO Cooperative program whose objective was to better define the sector goals under the Fourth (1976-1981) and the Fifth (1981-86) 5-Year plans. The major goal under these plans was to accelerate creation of water supply systems in major urban centers. In this context, the project's objective was to provide water systems in 13 secondary centers, extend the distribution systems in Douala and Yaounde, the two largest cities, and strengthen the Cameroon water sector organization, particularly the daily management and operation of SNEC, the urban water utility. The total cost of the project was estimated at $51.4 M, of which IBRD would finance $21 K and CDC would cofinance UKE6.75 M ($15 M equivalent). 2. The physical scope of the project was enlarged during project implementation to include water systems in three more secondary centers. All the physical components for the centers were executed under the project. In Douala and Yaounde, it was intended in part to rehabilitate and improve the treatment stations. However, SNEC preferred to extend the plants. Apart from this modification, all the physical components were also completed. 3. The total cost of the project as implemented amounted to $53.4 M, about 96 percent higher in CFA terms than the appraisal estimate but only 25 percent higher iL CFA terms than the costs of the revised project (i.e., inclusive of three more secondary centers). The cost overrun was easily absorbed by the higher average exchange rate prevailing during the course of the project (415 CFA instead of 220 CFA/US$ at appraisal). 4. Procurement differences between Cameroon and the Bank over particularly the 16 center contract caused an 18 month delay. Together with a late effectiveness of 18 months, altogether a three-year delay affected the timely completion of the project. 5. The poor financial performance of SNEC is attributed to much delayed and few tariff increases (one in 1982 and another in 1986) and excessive arrears from both Government and private consumers. The late arrival of the financial advisor (in 1986) did not help SNEC in addressing the poor financial situation earlier. 6. The major covenants that were not met are (a) the review of concession agreements between the Borrower and SNEC; (b) settlement of bills relating to the Borrower's department and services within three months; (c) annual adjustment of tariffs; (d) generation of rates of return on fixed assets as specified; and (e) the preparation of five-year financial forecasts. - vi - 7. The overall economic rate of return (ERR) of the project is now estimated at five percent, to be compared with a seven percent rate expected at appraisal. On a sub-project basis, ERRs achieved in the individual centers proved to be more volatile, due to cost overruns and excessively optimistic consumption forecasts for the secondary centers. As a consequence, the need for cross-subsidization between the two major cities and the secondary centers has increased. The adoption of appropriate technologies. such as slow sand filtration plants, will, however, allow to keep operation and maintenance costs in the smaller towns at a minimum and enhance the sustainability of project benefits. REPUBLIC OF CAMEROON SECOND WATER SUPPLY PROJECT (LOAN 1753-CM PROJ9C.T GOMXLETI1 R8PR I. IKMM=i 1.01 This report reviews the Second Water Supply Project in Cameroon (Loan 1753-CM) for which an IBRD Loan of $21.0 M was approved on September 6, 1979 and signed on December 11, 1979. The Project was completed on June 30, 1986 and the Loan closed on September 30, 1986. The Borrower is the Government of Cameroon with re.lending in the amount of $18.1 M to the Soci6t6 Nationale des Eaux du Cameroun (SNEC). the major executing agency and principal beneficiary. Joint financing was provided in the amount of £6.75 M ($15.0 H equivalent) by the Commonwealth Development Corporation (CDC). 1.02 At the time of appraisal, sector organizations and responsibilities were as follows: (a) The Ministry of Economy and Planning (MINEP) provided general investment guidelines, and sought external financing for investments; (b) The Directorate of Energy and Water (DEW) of the Ministry of Hines and Energy (MINMEN) was in charge of overall planning, design and construction supervision of new urban watar supply systems, and operation of small urban water supply systems; it also assumed the Itutelle" of SNEC; (c) SNEC was entrusted with planning, design and construction supervision of extensions and operation of major urban water supply systems: and (d) The Directorate of Rural Engineering and Community Development of the Ministry of Agriculture was responsible for rural water supply. There has been no major change during project execution in the sector organiza- tional set-up, except that construction supervision is now mostly entrusted to SNEC. 1.03 Sector goals under the Government Plan (1976-Zsl) were as followes (a) provide water supply by 1981 to about 70 major urban centers; (b) increase water supply facilities in rural areas to cover about 50 percent of the rural population: (c) complete studies that would lead to ,'iplement water systems in smal'l centers in the succeeding plan so as to reach a 100 percent service level target in urban centers by 1986; and (d) in the sanitation and drainage sectors, prepare and update studies for major centers, particularly Douala and Yaoundd, and implement emergency drainage works in Douala and Yaound6. At the end of 1985, 50 major urban centers were operational. Another 46 were due to be commissioned end of 1986 (at this moment it is not known how many have - 2 - actually been commissioned). By then, about half of the major urban centers would be equipped with modern water systems. Over a hundred small semi-urban centers are also equipped with packaged treatment plants. Because of the absence of cost recovery and poor institutional framework, SNEC has refused to take over operation of these systems which were implemented by MINNEN. Rural water supply level still lingers around 20 to 25 percent. Drainage and sanitation studies have been carried out, either under Bank financing or the Nationml udget, and major drainage work proposed under the IBRD-financed Douala Infrastructure Project appraised in March 1985 are to be executed. 1.04 Urban water subsector issues identified at appraisal comprised the following: (a) inadequate senior management stafffng, due to hasty elimination of expatriate personnel, and inadequate tariff levels in the past greatly impaired SNEC's effectiveness; (b) to increase service levels, SNEC ought to be entrusted design and construction supervision responsibilities mostly vested to the Ministry; and (c) DEW suffered from lack of appropriately trained personnel. SNECs management has somewhat Improved through injection of better local qualified staff in the years since appraisal. Tariffs have been increased (par%. 5.03). Although the organizational responsibilities remained the same on paper, In practice, SNEC now asaumes almost total responsibility for construction supervision and shares responsibility with LEW for design of major urban systems. DEW still remains understaffed particularly at engineering level. 1.05 SNEC is a public enterprise with ownership as followss Soci4ta Nationale d'Electricitd du Cameroun (SONEL) 11 (67 percent), Government (20 percent), Caisse Centrale de Cooperation Economique, France (CCCE) (11 percent) and municipalities (2 percent). It was created in 1967 and operates under a concession syster. By 1979, it operated 20 urban centers, including Yaoundd and Douala, the two largest cities in Cameroon. It is under the tutelle of MINHEN which must approve tariffs and investment programs. SNEC's Board comprises 12 members elected by shareholders, eight being Government members, two from CCCE, one from municipalities and one from the Economic and Social Council. There has been no change in SNEC's ownership or status. 1.06 The project's main objective was to provide the major stepping stone towards achieving 100 percent potable water service for the urban population by 1990, or more specifically under the project: (a) thirteen secondary centers were to be provided with a reliable potable water supply to be managed by SNEC; (b) distribution systems of Dounala and Yaoundd were to be extended so that by 1983, 70 percent of the population would be serviced, with 1/ Government owned 80 percent of SONEL; Government's share in SNEC was therefore effectively 74 percent. particular attention to low income areas which covered about 46 percent of the two cities; (c) the groundwork for an organized sanitation and drainage sector for Douala and Yaoundd would be laid by carrying out technical and financial studiess (d) a pilot public health education project would be initiated to increase public health awareness and to materialize potential health benefito that could be derived from the project; and (e) the Cameroon water sector organization would be strengthened, particularly the daily management and operations of the water services of SNEC. 1.07 The project has been instrumental in part for resolving sector issues and achieving sector goals. The number of urban water supply systems has more than doubled with about half constructed by the project. Tariff increases of around 100 percent were implemented in 1982, but these restored SNEC's financial situation to a satisfactory level only for FY ending 1982. Construction supervision capabilities were developed by SNEC staff. Drainage studies have also been carried out enabling the identification of major drainage works under the proposed Douala Infrastructure Project. II. PROJECT IDENTIFICATION, PREPARATION AND APPRAISAL A. Origin 2.01 The First Water Supply Project (Loan 604-CM) was completed in 1974. As there was no immediate follow-up to that project, continuity and growth of sector institutions, and thus generation of funds for expansions in Douala, Yaoundd, and secondary centers was interrupted. Therefore, Government requested the Bank/WHO Cooperative Program to carry out a Sector Study in 1974 to better define sector goals under the Fourth (1976-81) and the Fifth (1981-86) 5-Year Plans. The identification of the Second Project was both the result of recommendations of the Sector Study and the continuing sector dialogue with the Government. B. Project Preparation and Appraisal 2.02 The project was prepared jointly by MINMEN, SNEC and the Bank. The feasibility studies of the 13 secondary centers, identified from a priority list established by the Sector Study, were carried out by a consultancy firm, and financed under an IDA Technical Assistance Credit (Credit 673-CM). Studies for the urgently needed improvements to the Douala and Yaoundd systems were conducted by an engineer seconded to SNEC by a foreign water supply company. Bank consultants made in-depth assessments of the Douala and Yaoundd treatment plant facilities and urban poverty aspects. 2.03 Appraisal of the project took place in September/October 1978. The components appraised remained essentially the same as identified and prepared. However, although the Bank consultant who reviewed the treatment facilities in Douala and Yaound6 recommended that rehabilitation would increase production to 4- desired levels and would be the least cost solution, SNEC preferred to build new facilities rather than optimize existing ones. 2.04 The project as appraised was costed at $51.4 M, with a foreign component of $36.0 M. (A detailed project description is at Annex I.) This cost included the rehabilitation of the Douala treatment plant as it was recommended by the consultants. It became, however, already apparent during appraisal that SNEC/Government preferred an extension rather than a rehabilitation for the treatment plant. This, the only major technical issue, was never really resolved until implementation of the project (para. 3.06). C. Negotiations 2.05 Started on May 4, 1979, with representatives from both SNEC and Government, it soon became apparent that two issues, hitherto thought manageable, became major stumbling blocks and caused negotiations to be suspended a week later on May 10, 1979: (a) The delegation reserved Section 4.02 of the draft Loan Agreement and the draft letter referring to this Section, which requires Government to revise the current concession contracts with SNEC, and provide that SNEC and the Government are responsible for providing all the urban population with reliable and potable water by 1990, with particular emphasis on low income populations who would be provided with standpipes and social house connections. (b) Another important reservation was made by the delegation on Sec- tion 4.03(b) (i) of the Loan Agreement, whereby it is required for the Government to guarantee the future timely payment of municipal arrears. (Without this, the financial viability of SNEC would be compromised.) 2.06 Between July 1-5, 1979, negotiations were completed by telex and issue (ii) was resolved by Government agreeing to pay arrears beyond three months' billing. No mention could, however, be found in the files about the Cameroonian's position regarding issue (i). The Loan Agreement on the other hand contains a watered down consultation clause about the subject (Sec- tion 4.03(b) (ii)). Section 4.02 was incorporated in the Loan Agreement unchanged. An additional point that Government brought up in the past negotiation correspondence was its desire to onlend to SNEC at Bank terms without the envisaged two percent spread. III. PROJECT IMPLEMENTATION A. Effectiveness and Covenants 3.01 On March 11, 1980, the effectiveness date was postponed for the first time as Government/SNEC had not yet provided the Subsidiary Loan Agreement and the Legal Opinion. It took four more three-month extensions until these documents were finally produced and the project became effective on May 12, 1981, 18 months after signing and 21 months after Board approval of the Loan. 3.02 The L/A and ?/A had a combined total of 19 specific covenants besides the standard ones for this type of project, pertaining mostly to financial targets and review of concession contracts. A complete description is given at Annex III. The borrower and beneficiaries have performed poorly in meeting the agreed-upon goals and targets. The most important ones that were never really met are: (a) review by June 30, 1980, or such other date as may be jointly agreed upon, existing concession agreements between the Borrowers and SNEC (Section 4.02, LIA); (b) Borrower shall cause its departments and services to pay to SNEC, within not more than three months after billing, all charges for water consumption (Section 4.03); (c) adjust annually water tariffs to achieve financial targets (Sec- tion 4.03 b. L/A); (d) SNEC undertakes to manage its finances in such a way as to generate a rate of return on fixed assets of at least five percent until June 30, 1983, six percent for FY84, and seven percent thereafter (Sec- tion 4.04 P/A); and (e) SNEC prepares and submits to the Bank annually, not later than June 30, a five-year financial forecast (Section 4.07 P/A). 3.03 It is important to realize that covenants (a) and (b) already created a bottleneck during negotiations (para. 2.05) and it can be assumed safely, that Government merely yielded during the post-negotiation telex exchange in order to get the project to the Board, fully aware that both covenants were unrealistic in the Cameroonian context. Indeed, discussions with the Bank about simplifying concession contracts never got underway. Today, the contracts are essentially unchanged. Similarly, arrears on account of public services and enterprises were never lower than at least five months' billing: Arrears (CFAF mil lIon) End of June: 1979 198 1981 1902 1988 1904 1985 1986 Pubi le 730 669 593 800 1,600 8,600 8,700 7,500 Private 770 965 938 1 2 2 6. N.A. Total 1U4m a LJn &M ,m L ILM i JaL (81111ng Mos.) 7 a 5 5 8 15 14 3.04 Moreover, as SNEC took over billing of private consumers from SONEL in 1983-85, arrears started to augment as customers realized that SNEC does not possess the necessary infrastructure nor the political authority to cut off services. These arrears, combined with Government's slow response in adjusting tariffs, contributed principally to SNEC's negative results over the years under the review. In addition, the lack of timely tariff adjl, tments caused SNEC to - 6 - never meet the rate of return targets set under P/A Section 4.04 (see para. 3.02(d)). 3.05 In addition to the unexpected problems created by inadequate tariff revisions, SNEC experienced other problems in meeting covenants. The rate of return calculation proved elusive, as SNEC lacked -- and continues to lack -- the sophisticated accounting techniques for the revaluation of assets which are clearly beyond the scope of SNEC staff. Moreover, although a cost accounting system has been established, it is not sufficiently refined to provide data for each of the 16 centers. Yaoundd and Dounala so as to analyze costs and benefits. Last but not least, the five-year financial forecast required annually has been prepared but once during project implementation (Section 4.07 P/A). This can also be attributed to lack of skilled, experienced personnel. Moreover, in fairness to SNEC, it has to be said that not all data necessary to prepare a meaningful projection has been forthcoming from Government as it continued to contract bilateral and multilateral aid to finance water supply systems in secondary centers without asking questions about sustainability. This problem is discussed in more detail in para. 5.02 (c). B. Revisions 3.06 Owing to the delay in effectiveness and over procurement issues. project costs were revised upwards to CFAF 17.7 billion from CFAF 11.3 billion at appraisal. This cost revision was done during a May 1981 supervision and the major contributing elements, besides inflation, were the inclusion of four additional secondary centers at Batibo, Fundong, Mundenba and Nguti. 21 These centers were added to the project at the request of Government on the clear understanding that any surplus costs would have to be paid by Government. However, given the strong appreciation of the US$ over the implementation period, additional costs were easily absorbed by the Loan. Towards the end of the major contract disbursement period, in November 1985, it became actually necessary to increase civil works and equipment disbursement percentages to 90 percent from 38 percent in order to make full use of loan proceeds. This rise was justified since SNEC's own cash generation fell short of projections and, thus, also its contribution to project cost. C. Project Implementation Schedule 3.07 Overall, the execution of the physical components suffered a three-year initial delay, partly because of late effectiveness (para. 3.01) and partly because of procurement differences (para. 3.08). On the other hand, the contractor executed these components in reasonable time despite difficult logistic conditions which impeded mobilization and start-up particularly in the sixteen centers. Generally, all physical components have been completed within previously planned execution periods. D. Procurement 3.08 Adherence to Bank procurement guidelines required strenuous effort and perseverance on the part of Bank staff because of a multitude of inadequacies relating to advertising, incorporation of Bank comments in final tender documents, bid evaluation criteria, bid opening and bid evaluation. The fact 21 Of the new total 17, one center was eventually dropped. -7- that the Direction Centrale des March4s (DCM) had the authority and the responsibility to intervene and review contract processing compounded the problem. The DCM consistently referred to Cameroonian regulations regardless of the requirements of the Loan Agreement and Bank guidelines. 3.09 Contract award for the 16 center components, however, became the major issue of procurement differences between Cameroon and the Bank, that eventually caused an 18-month implementation delay. The bid evaluation criteria set out in * the tender documents were unclear. Despite Bank requests for modifications, changes were not always made. Subsequently, bid evaluation reports prepared by SNEC and DCM did not propose any contract award. SNEC's view was that the lowest . bidder did not provide in its bid a treatment process that guaranteed acceptable water quality. The Cameroonians then decided to re-bid on their understanding that the bidders could alter their unit prices. The Bank insisted on reviewing all original bids and came to the conclusion that the lowest evaluated bid was indeed a responsive bid. The Bank objected to the re-bidding and insisted that the contract be awarded to the lowest evaluated bidder (original bid). The treatment equipment percentage cost was small compared to the overall cost and as there was a substantial difference between the lowest and second lowest bids, the Bank advised that negotiations be carried out in good faith with the lowest bidder and that SNEC could therefore ensure during negotiations alternative satisfactory treatment processes. The resolution of this issue took a long time after various exchanges but Cameroon finally agreed with the Bank's position. E. Proiect Costs and Disbursements 3.10 A detailed comparison of project costs at appraisal compared with those at completion is at Annex II. These costs can be summarized as follows: Total Costs (CFAF million) Component A. Appreieal (s ) B. Revision (X) C. Completion (X) g (X) (1) 18 Centers Water Supply Systems /1 5,470 48 8,420 48 15,819 /h 71 188 (1l) Douala Water Supply 8,060 27 4,400 25 2,898 12 f1 (III) Yaound6 Water Supply 680 6 2,930 16 1,875 9 64 (Iv) Technical Assist. A Consultants 1,210 11 1,030 6 1,685 7 152 (v) Studies 895 8 896 6 208 1 23 Total I M a= M ULM Mi /I Revision for 16 centers instead of 18 as at appraisal. /b This includes eame 2,500 million CFA of additional works directly negotiated between MINMEN and the contractor without SNEC's involvement. The Bank did not participate in the financing of these works. 3.11 Owing to a substantial revision in project scope, comparison of completion costs to appraisal costs is not relevant. Completion costs should be compared with costs of revised project scope. Cost overrun calculated on this basis is, consequently, approximately 25 percent. - 8 - 3.12 A comparative disbursement schedule is at Annex IV. Given the 18 months' delay in effectiveness as well as the initial procurement problems, actual disbursements lagged substantially behind Appraisal estimates. Thus, the first major disbursement of some $5 M equivalent did not take place until year five (1984) after Board approval. Start-up expenditures were financed out of SNEC's cash generation as follows: Year Ending June 30: 1979 1980 1981 1982 1983 CFAf Million 325 511 438 1639 2472 3.13 CDC's co-financing share of E6.75 M corresponding to $15 M equivalent at appraisal was disbursed in two lump sum payments during the earlier years of project implementation. Using the average exchange rate of the IBRD Loan, CDC's share only amounted to approximately $9.4 M due to a smaller appreciation exchange rate of the E sterling. This shortfall contributed in part towards the increase in the Bank's disbursement percentage from 38 to 90 towards the end of the project in November 1985 (para. 3.06). F. Performance of Consultants and Contractors 3.14 The distribution systems of the Douala and Yaoundd components were designed and their construction supervised by the same consultants. SNEC was generally satisfied with their performance. The treatment plant of Douala was planned to be rehabilitated, following the recommendation of a Bank consultant (para. 2.02). However, SNEC preferred to carry out an extension and thus financing for this component was excluded from the IBRD Loan. Final design of the 16 center component was contracted out by MINMEN and was carried out by a different consultant other than the ones who did the feasibility studies. SNEC was not happy about the change in consultant. Eventually, supervision of construction was assigned to a project coordinator recruit2d from a third consulting firm, backed by a few engineers from the consultants who did the feasibility studies and Cameroonian site engineers posted on each construction site. Several design changes had to be undertaken during construction, caused partly by unforeseen terrain conditions, interference from the local inhabitants in some cases and by less than sufficient detailed design contributed by the change in consultant. 3.15 SNEC was satisfied with contractor performance on the Douala and Yaound4 components. On the sixteenth center component, mobilization and start-up problems arose which had a direct impact on construction quality. The wide geographical spread of the construction sites, together with difficult logistic conditions required extensive efforts on the part of the contractor. The fact that the contractor was sufficiently backed up with a considerable pool of manpower and equipment resources enabled the contractor to overcome the initial problems within reasonable time and construction improved to a satisfactory level until completion. - 9 - IV. OPERATING PERFORMANCE A. Water Produced and Sold 4.01 The following table indicates that both water production and water billed have increased on average about 8.5 percent per year from FY78 to FY85 in comparison to 13.5 percent per year forecast at appraisal. SNEC Water Production Water Produced (MS) Water Biled (Mms) X B111in FY Appralsal Actual Appraisel Actual Appralsel Actual 1976 88.6 -- 24.7 - 71 1979 36.5 36.4 27.0 26.2 7 72 1980 48.1 88.8 32.8 27.6 71 71 1981 53.7 43.0 37.8 89.6 71 71 1982 60.1 47.8 42.1 84.4 71 72 1983 67.1 52.9 47.0 89.4 71 74 19084 75.6 58.8 52.9 88.0 71 67 1986 84.8 61.8 69.4 44.1 71 72 Unaccounted for water on average was satisfactory throughout. with the exception of FY84 when billing responsibilities were being transferred from SONEL (The Cameroon Electric Company) to SNEC. Forecast at appraisal was more or less correct. B. Metered Connections 4.02 The average percent annual increase in metered connections has been quite impressive (13.5 percent) although not as much as that forecast at appraisal (16 percent). Number of Metered Connections FY78 FY79 FY89 FY81 FY82 PYeS FY84 FY66 Appraisal -- 86,878 46,198 64,880 62,299 71,681 81,469 98,654 Actual 32,989 88,918 42,371 61,096 58,947 68,697 78,464 81,986 C. Operation and Maintenance and Productivity 4.03 In general, quality of operation and maintenance level of SNEC is satisfactory. The total number of centers operated by SNEC has increased more or less as forecast at appraisal. Productivity as measured by number of connections/staff has, however, fallen wall below expectations (see table below), a decrease from 57 to 43 compared to an increase from 57 to 101, forecast at appraisal. - 10 - Personnel Productivity: No. of Centers Productivity: (Connectlons(Staff) FY Appraisal Actual AOPrelsel Actual Appraisal Actual 1976 ** 678 -- 20 ** 57 1979 648 648 24 20 57 67 1986 7568 736 82 20 81 88 1981 787 919 41 87 69 56 1982 823 1208 41 42 69 49 1988 847 1369 48 44 76 so 1984 888 1616 48 47 92 46 1986 922 1878 50 5 101 48 1986 ** 2285 -- -- * 4.04 A positive aspect of the project as regards operation and maintenance has been the execution of slow sand filtration plants in 8 of the 16 secondary centers. As there has been a general reluctance and unfamiliarity with this appropriate technology for surface water treatment, it is hoped that their existence in Cameroon would convince other Western African countries of their suitability to minimize operation and maintenance constraints, particularly in secondary centers. V. FINANCIAL PERFORMANCE 5.01 SNEC's Finances. Although SNEC complied with the covenant (P/A Section 4.01 (a)), statements as per Annex V are not sufficiently representative of the financial position to permit a test of the financial covenants (para. 3.02). Principal reasons for that aret (a) Since 1981/82, Audit Reports have consistently mentioned that concession assets operated by SNEC are not properly reflected in the Balance Sheets. The 1984/85 Audit advances, for the first time, the figure of CFAF 9.0 billion ($28.7 M) as an estimate of such assets that are not accounted for. (b) Exchange rate adjustments due to the US dollar and E Sterling fluctuations are accounted for on the total outstanding U.S./fixed assets in 1985, rather than stretched over payment years. The Auditors indicate that assets are therefore over-valued by some CFAF 200 million ($0.6 M). (c) Inventory control or lack thereof, a continued source of criticism on the part of the Auditors, renders SNEC's total value of stocks too high by some CFAF 60 million ($0.2 M) at June 30, 1985. 5.02 Nevertheless, an attempt to calculate the rate of return on average net fixed assets in operation during FYs ending 80 through 85 yielded the following results: - 11 - Rate of Return (f) on Average Value of Net Fixed Assets yesar: 79/80 08 18 28 88 48 Appraisal Estimate 4.7 4.3 5.3 6.1 5.5 6.8 Actual 1.0 0.1 2.4 8.1 -2.8 -6.2 This comparison clearly demonstrates that targets were never met. Other reasons for the shortfalls were: (a) Revenues from water sales rose substantially less than anticipated during appraisal with 1984/85 actual figures only reaching 66 percent of estimates. The adverse result was compounded by the fact that operating, as well as non-operating, costs rose faster than estimated and by 1984/85 exceeded estimates by CFAF 1.9 billion ($6 M) or 15 percent. This indeed resulted in a net loss of CFAF 134 million ($0.4 M) against a forecasted net income of CFAF 3.9 billion ($12.5 M). (b) Through no fault of its own, SNEC was forced to finance a considerable amount of public arrears (para. 3.03) which, by 1985 and 1986, reached CFAF 3.7 billion ($11.8 M) and CFAF 7.5 billion ($23.9 M), respec- tively. It did so mostly through revolving short-term line of credits with local banks. Given the prevailing high interest rates on short-term bank overdrafts of 18 percent in 1986, this practice imposed an unusually heavy interest charge of some CFAF 650 million ($2.1 M) on its income statement. (c) Last but not least, owing to SNEC's parent Ministry's commissioning of bilaterally financed urban water schemes in numerous small towns without the required customer base to render the schemes financially viable, SNEC's maintenance costs rose disproportionately to revenues. 5.03 Equally devastating proved Government's reluctance to annually adjust tariffs in line with prevailing inflation (para. 3.02 (c)). Indeed, the only tariff adjustment during project implementation took place in October 1982, when it was finally decided to raise average tariffs from CFAF 120, to 220/ma. Commensurate with Government's informal policy to freeze tariffs for four years, the latest tariff adjustment occurred in October 1986, to CFAF 242/mf?, with yet another freeze in effect until 1990. Meanwhile, inflation alone should have driven up tariffs by some 70 percent over the period under review. The Commercial Department undertook a study in early 1986 to determine tariffs required to cover operating costs, including debt service for 1985. The result suggested an average tariff of FCFA 420/mn ($1.34/mn) nationwide; variations ranged from a low of FCFA 202/m3 in Yaoundd with a high of FCFA 2304/m ($7.34) in Ebolowa (South Province). 5.04 This uneven performance of SNEC per population center led to annual injections of capital on the part of Government, the majority shareholder, as follows: - 12 - Annual Equity Contribution (Million CFAF) 1980/1 191L82 1982/8 1983/ 4 1984/86 Share Capital 1500 -- -- -- -- Subvention * /1 2178 3812 5092 6630 6737 /I Shown as Subventions in the financial statements; was, however, used to finance capital expenditures. These capital flows were required to maintain an acceptable debt/equity ratio over the years under review as SNEC increasingly financed its operations by short- and long-term credits. By financing watcr supply installations through outright subventions which appeared in SNEC's net worth, Government obviously took care of Section 4.06 a) of the Loan Agreement. There is no doubt that SNEC's managerial and financial capacity sorely lags its accumulation of technically sophisticated installations nationwide; what needs, therefore, an answer, is: how much longer is Government going to be in a position to inject sufficient capital to sustain SNEC's operations at an acceptable level? It is safe to conclude the chapter by stating that the project as conceived neglected to sufficiently address the institutional side of SNEC thereby leaving installations which cannot be sustained by operating cash generation. VI. INSTITUTIONAL DEVELOPMENT AND STAFFING 6.01 An improvement program was recommended at appraisal to improve SNEC's organization and management. More specifically, changes recommended were that: (a) operating regions would be increased from three to four with greater responsibilities given to regional managers recruited from SNEC rather than from SONEL's staff; (b) SNEC would create its own Commercial Department and discontinue using SONEL for billing and collection services; (c) SNEC would revise its accounting systems and procedures; (d) an internal audit unit would be created; and (e) annual five-year forecasts of its financial status would be prepared. Operating regions have been increased to four with greater responsibility given to SNEC's regional managers. SNEC has taken over totally billing and collection services from SONEL. While billing has improved, collection on the other hand has deteriorated (see para. 3.03). Its accounting systems and procedures remain inadequate and its new audit unit not performing satisfactorily (see para. 5.07). Annual five-year forecasts have not been prepared on a regular basis (see para. 3.02). 6.02 Para. 4.03 stated the substantial increase in personnel, in fact more than double the appraisal forecast (see table below). Large numbers of staff were particularly recruited in the semi-skilled and unskilled categories. There - 13 - is no sign of abatement in the continuing recruitment process. Such overstaffing will no doubt have an adverse effect on overall operational costs. SNEC Staffing Senior Staff Junior Staff Semi-Skilled A Appraisal FY Tech. Admin. Tech. Admin. Unskilled Staff Total Forecast 1978 -- -- -- -- -- 578 678 1979 28 16 61 40 504 648 648 1980 38 18 78 47 662 738 768 1981 35 27 89 55 718 919 787 1982 50 40 118 74 926 1,208 828 1983 72 8 119 92 1,038 1,359 847 1984 73 42 123 123 1,254 1,815 888 1985 78 53 160 164 1,423 1,878 922 1986 105 53 200 201 1,676 2,235 6.03 The implementation of the Management Improvement Program required that SNEC would be reinforced by a team of technical assistants in operations, in accounting, commercial activities and training. At the time of appraisal, it was considered that the departure of expatriates which formed part of an overall Cameroonisation program was too hasty. Indeed, their number decreased but however picked up again as the need to assist SNEC in its ever increasing activities became necessary as shown by the table below. SNEC Technical Assistance 1979 1980 1981 1982 1983 1984 1985 1986 Operations 2 2 2 8 3 8 4 2 Studies A New Works 3 2 4 5 5 4 5 4 Commercial 1 1 1 1 1 1 2 2 Financial -- -- -- -- -- -- 1 Training-- -- -- 1 1 1 1 1 Total A as g A is The financial advisor was only recruited in 1986 much later than necessary as evidenced by the poor financial performance of SNEC (see para. 5.01). Technical operations however were well backed up throughout the project implementation period. 6.04 Very little training was carried out between 1979-82. Indeed, during that period, only 11 technicians and 3 administrative officers followed training courses. However, between 1983-86, an intensive training program was put into effect following the arrival of the training officer, a total of 396 staff followed a training course, out of which there were 29 technicians, 36 adminis- trative officers, 211 skilled and semi-skilled personnel and 120 junior administrative staff. - 14 - VII. PROJECT JUSTIFICATION Project Benefits 7.01 Project objectives were largely met in terms of completed works. Piped water systems were substantially expanded in five secondary centers. Inadequate water systems previously operated by MINMEN were fully rehabilitated and expanded and new systems were installed, thus providing safe water in 11 other centers. The technical option retained will also warrant low-cost and sustainable operation and maintenance of the production facilities in the smaller centers (para. 4.04). In addition, secondary and tertiary distribution networks and storage capacities were increased by 16 percent in Douala and Yaound4. 7.02 Studies contemplated within the Project were only partially carried out. The drainage studies allowed to identify the major works required to eliminate acute flooding problems in Douala. The Hygiene Education identifica- tion study which would have provided guidelines for a health education pilot project was not launched, due to a continuous lack of interest on the part of the Health Ministry. Service Levels 7.03 It is estimated that 220,000 additional people have benefitted from the project, which is substantially lower than the 700,000 expected at appraisal. A 100 percent service level objective has been achieved in secondary centers, but service levels in Douala and Yaound6 amount, respectively, to 52 percent and 49 percent compared to SAR estimates of 75 percent. SAR forecasts were based on (a) the implementation of a shared yard connection program, allowing to install 11,000 yard connections serving on average 30 people; and (b) a dramatic increase in the number of standpipes, particularly in low-income areas. To that effect, provisions were included in the L/A (a) to cause Government and SNEC to revise existing concession contracts in order to incorporate obligations to ensure a full coverage of urban areas by water service (Section 4.02(a)); and (b) to ensure timely payments of water bills by municipalities for standpipe consumption (Section 4.03(a)). 7.04 As stated in para. 3.03, both covenants were unrealistic in the Cameroonian context and were never met. Government was reluctant to authorize tariff increases which would have allowed SNEC to expand the service and SNEC proved to be lukewarm in promoting yard connections. A pilot program was initiated in 1986 in secondary centers but is devoted to conventional connections and has yet to be extended to the major cities. Only 121 standpipes were installed in Yaoundd and Douala during the project (vs. 390 forecast in the SAR), and the total number of standpipes in operation continued to decrease along the trend observed before. As a result and although SNEC's performance in installing private connections has been satisfactory (para. 4.02), the present service levels in Douala and Yaound4 are almost identical to those prevailing in 1978. (A detailed comparison of SAR and actual estimates is provided in Annex 6-1.) 7.05 It appears that the major constraint to the development of water service has been the rapid growth of slums and squatter areas in Douala and Yaoundd. However, the project allowed to finance a minimum level of urban planning and to identify and prepare an urban project aiming at the restructuring and provision of basic infrastructure services, including water supply in low - 15 - income areas. This project is currently ongoing in Douala and would provide a comprehensive solution to an issue which proved to be beyond the capabilities of the water utility alone. Rates of Return 7.06 The economic rate of return (ERR) of each sub-project has been calculated using incremental revenue derived from water sales as a prCy of * benefits. Detailed calculations are prov..ded in Annex 6-2. A comparison of ERR estimates in the SAR and after project completion is given in the following table. Economic Rate. of Return and Average Incremental Costs in Prolect Centers ERR AIC Estimates Center Estimates (CFAF/M3) /l SAR After Completion SAR After Comletbion X X 1. Douela 20 12 122 -- 2. Yeound6 7 16 144 -- 8. Secondary Centers Average 2 0 19 297 Bafang S -1 16 861 sues -2 2 2"0 217 LImbe 5 4 162 210 Mamfe 8 2 125 222 Tombe I 10 -2 112 829 Ball -4 0 288 818 Jakiri 0 -8 288 324 Kumbo -1 1 256 380 Mbengwi 2 -3 28 424 Njinikov 2 -5 221 435 Nkembe -1 -5 351 700 Wum 4 3 208 257 Satlbo /k -- -9 -- 698 Fundong /k -- -7 ** 625 NOut1/ -- -4 --47 Mundemba /b -- -4 -- 614 4. Overall Project 7 6 /I Mid-1978 prices /b Centers added to the project after the appraisal stage 7.07 The overall ERR of the project is now estimated at 5 percent which compares with the 7 percent ERR contemplated in the SAR. However. on a sub-project basis, ERRs achieved in the individual centers proved to be more volatile. Contrary to SAR estimates, the Yaound4 sub-project is now forecast to be more profitable than the Douala sub-project, which reflects lower unit costs of network expansion in the former city. In the secondary centers, results have - 16 - been modified for two major reasons. First, capital costs were often higher than expected in a number of centers. Actual expenditures were, for instance, three times as high as forecast in the SAR in Bali, Jakiri, Mbengwi, and Tombel. In addition, although the overall present consumption is close to SAR estimates for the whole of the secondary centers, demand forecasts, particularly in terms of service connections, failed to materialize in Bafang, Njinikom and Nkambe. The four towns added to the project generate negative ERR9, which is attributable to the small size of the centers, each of them regrouping less than 5,000 inhab- itants. Average Incremental Costs 7.08 The Average Incremental Cost (AIC) is normally considered as a proxy for long range marginal cost (LRMC). Due to the limited scope of the works executed in Douala and Yaoundd, which were exclusively devoted to distribution and storage facilities, AICs have not been calculated for those cities. Individual AICs of the secondary centers have been reestimated and are given in para. 7.06. Expressed in mid-1978 interior prices, AIC is on average 50 percent higher than forecast in the SAR, with more substantial variations in Bafang, Mamfe, Tombel, Mbengwi, Njinikom and Nkambe. AIC values are highly correlated to the size of the centers. AIC in the range of CFAF 200 to 250/mn are observed in the towns regrouping more than 15,000 people, with the noticeable exception of Bafang while the smallest centers are over the CFAF 500/mn threshold, equivalent to CFAF 1,000/mn in 1986 prices. VIII. BANK PERFORMANCE CONCLUSION AND LESSONS LEARNED 8.01 Differences on procurement between Cameroon and the Bank greatly affected the early years of project implementation. The Bank correctly maintained a firm position throughout in order to adequately adhere to the Loan Agreement and Bank guidelines. On the Douala and Yaound6 components, this position was undermined by the mere fact that Cameroon having then a fairly sound financial footing decided to finance themselves the subcomponents whenever they disagreed with the Bank. 8.02 Cost overruns particulirly on the sixteen center component were substantial. Appraisal estimates were, on the one hand, overly optimistic. Delays in start-up, difficult terrain conditions, intervention of DEW for consultant recruitment and for contract negotiation for additional works, substantial redesigning and interference of local inhabitants all contributed also to the overruns. 8.03 In correctly advising the Caneroonians on the introduction of slow sand filtration plants, the Bank has contributed in a significant way in encouraging the use of suitable technology. Most West African countries are either unfamiliar or reluctant to utilize this technology. It is hoped that their existence in Cameroon will convince other West African countries of their suitability to minimize operation and maintenance constraints, particularly for secondary centers. 8.04 On average there were two supervision missions per year. Most missions consisted of three staff. Over the seven year supervision period, there have been four different engineers, four different financial analysts, and two - 17 - different economists. Greater continuity, particularly for the financial analysts (three changes during 1984-86) might have enabled better handling of financial problems during implementation. It can be spe lated with the benefit of hindsight that more intensive financial supervision during the latter years of implementation might hat;e resulted in correcting some of the problems on the financial perforn,ance of SNEC, but no conclusion on this aspect would be objectively supportable. 8.05 Numerous covenants were included in the Loan and Project Agreements. It appears that the number of covenants and the content of them were rather ambitious from the beginning. About two thirds of them were met. Amog.; those that were not met (a) payment of administration bills within three months' billing proved difficult to realize in practice; (b) review of Concession Agreements was not done and seemed in fact not necessary; and (c) annual adjustment of tariffs proved also rather difficult to implement as Government commitment to cost recovery is half-hearted. 8.06 It can be safely concluded that the project was successful on technical aspects. Institutional development was hampered particularly due to the intervention of MINMEN, thus reducing SNEC's autonomy. Financial performance was unsatisfactory. Delay in the recruitment of the financial advisor proved particularly bad for SNEC's financial situation. Accumulation of arrears, much delayed response to tariff adjustments, and increased recurrent costs all contributed to the adverse situation. It is hoped that in the years to come SNEC's financial rehabilitation could start in the proper direction for a recovery. It will be necessary to carry out in the near future a sector investment review particularly for recurrent expenditures and corresponding revenues. It will be also necessary to reprioritize future sector investment programs. End of 1986, an almost equal number of centers as the number existing were to be ccmmissioned which will adversely increase recurrent expenditures. - 18 - ANNEX I Page 1 of 2 REPUBLIC OF CAMEROON SECOND WATER SUPPLY PROJECT LOAN 1753-CM PROJECT COMPLETION REPORT Detailed Project Description A. Water Supply Facilities (Physical Works) (i) Water supply systems in 13 secondary centers consisting of nine treatment plants with capacities ranging from 30 e8/hr to 250 e1/hr, 10 treated water reservoirs with capacities ranging from 260 ma to 1,500 ae, and 300 km of transmission and distribution pipes; (ii) Reinforcement and expansion of water distribution, trans- mission and storage facilities for Douala, including 220 km of pipeline and two treated water reservoirs of 1,000 e3 and 3,000 m' capacities and improvement of treatment facilities; (iii) Reinforc&:ent and expansion of the water distribution, storage, treatment and pumping facilities for Yaoundd, including construction of about 50 km of pipelines and two treated w.ater reservoirs of 2,000 m' and 3,000 e? capacities and improve..ent of treatment and pumping plant; and (iv) Constructio: of public standpipes and the introduction of a social house connection program. B. Studies and 'echnical Ac istance (i) Design and construction supervision of the water supply and operating facilities outlined above; (ii) Master plan studies for water production, transmission and distribution for Douala and Yaound4; (iii) Sewerage and drainage urban master plan studies for Douala and Yaoundd; (iv) Additional urban development studies for Douala and Yaound4 to provide a basis for the water supply, sewerage and drainage studies; (v) Feasibility studies for future extensions to other SNEC secondary water supply systems, including possible ground water research and standardization of equipment; - 19 - ANNEX I Page 2 of 2 (vi) Provision of about 18 man-years of training and management advisors for SNEC; and (vii) Consultants' services for promotion of local civil works contractors and manufacturers for the water supply and sanitation sectors. C. Management and Operation Improvement Program A program of specific actions to be undertaken by SNEC to strengthen its management and organization to ensure efficient operation of its facilities, improve project implementation and upgrade the level and quality of its services. D. Public Health Education (i) Consulting services (4 man-months) for the purpose of defining the elements of a rational health education program for the realization of full health benefits from the investment in water supplies; and (ii) Consulting services (12 man-months) for the detailed design, and for the supply of vehicles. REPUBLIC OF CAMEROON SECOND WATER SUPPLY PROJECT, LOAN 1763-CM PROJECT COMPLETION REPORT Project Cost Summary SAR Estimate Revision Actual Project Component Million CFA Million USt Million CFA Million USS Million CFA Million USS A. 13 (16) Center Component 1. Production: Equipment 725 3.3 -- -- 1923 4.6 Civil Works 1027 4.7 2748 -- 4134 10.0 2. Distribution: Equipment 865 4.0 1635 -- 3113 7.5 Civil Works 819 3.7 2267 -- 2271 5.5 3. Construction of Buildings 47 0.2 -- -- 430 1.0 4. Improvement of Existing Installations 112 0.5 -- --200 0.5 S. Contingencies 1872 8.5 1770 -- 3748 9.0 5467 24.9 8420 33.7 16819 38.1 B. Douala Component 6. Production: Equipment 218 1.0 -- -- -- -- Civil Works 370 1.7 1562 -- 1624 2.5 0 7. Distribution: Equipment 927 4.2 1091 -- 739 1.8 Civil Works 645 2.9 728 -- 607 1.4 8. Contingencies 898 4.1 1017 -- 323 0.8 3058 13.9 4398 18.1 2693 6.5 C. Yaound6 ComFonent 9. Production: Equipment 150 0.7 -- -- -- -- Civil Works 10e 0.5 316 -- 545 1.3 10. Distribution: Equipment 150 0.7 1121 -- 612 1.5 Civil Works 85 0.3 748 -- 609 1.2 11. Contingencies 199 0.9 742 -- 29 0.5 684 3.1 2927 12.0 1875 4.5 D. 12. Studies & Technical Assistance (SNEC) 1210 6.4 1033 3.2 1565 3.8 E. 13. Studies (Covernment) 896 4.1 896 3.6 208 0.5 Total Project Cost 11315 51.4 17874 76.6 22160 53.4 " 21 - ANNEX III Page 1 of 7 REPUBLIC OF CAMEROON SECOND WATER SUPPLY PROJECT, LOAN 1768-CM PROJECT COMPLETION REPORT Comllnce with Covenants Section Covenants Met Not Met Comments LOAN ACREEMENT: 4.02 (a) The Borrower shall: (1) by June 30, 1980, or X Discussed during such other date as may be agreed with the Bank, Supervision Mission undertake jointly with SNEC a review of the but never acted existing concession agreements between the upon by either $NEC Borrower and SNEC in order to standardize and or Covernment simplify the concession arrangements and (pare. 3.02). exchange views with the Bank on any changes in said agreements proposed to be made as a result of such review; and (ii) make arrangements satisfactory to the Bank to obligate SNEC, under its concession agreements with the Borrower, to expand the water supply systems operated by SNEC, and to provide for the financing of such expansion, with the objective of making avail- able an adequate, safe and reliable supply of potable water to the population of the Borrower's urban areas. 4.02 (b) The Borrower, the Bank and SNEC shall period- X Same as above. ically exchange views on the execution of the concession agreements and any further amendment, suspension or abrogation thereof or addition thereto which would be desirable to Improve the efficiency of SNEC's services. 4.03 (a) The Borrower shall: (i) pay and cause its X Para. 8.02 departments, services and agencies to pay to SNEC, within not more than three months after billing, all charges for water consumption; and (iH) cause such departments, services and agen- cies to present their proposals for budgetary appropriations to cover such charges on the basis of their consumption during the current fiscal year and their estimates of consumption increases. 4.03 (b) The Borrower shall: (i) cause its local councils X Para. 3.03 to pay to SNEC, within not more then three months after billing, all charges for water con- sumption due from such councils; and (ii) if and to the extent any such charges remain unpaid after such period, use all regulatory powers available to it to effect prompt payment to SNEC of any outstanding amounts due by such councils. - 22 - SECOND WATER SUPPLY PROJECT, LOAN 1788-CM ANNEX II Compliance with Covenants (continued) Page 2 of 7 Section Covenants Met Not Met Comments 4.64 Without limitation upon Its obligations under X Section 8.01 (b) of this Agreement, the Borrower shall from time to time review the rate of policies and structure of SNEC with the Bank and SNEC and shall take, promptly as needed, all measures (including, without limitation, approval of appropriate rate Increases) required on Its part to enable SNEC to carry out its obligations under Section 4.64 of the Project Agreement. 4.65 The Borrower shall take or cause to be taken all X action necessary to prevent any use or diversion of water which would affect matsrially and adversely the water supply systems operated by SNEC and, in particular, to avoid any pollution of the water sources for such systems which would endanger the quality of the raw water used by such systems. 4.06 (a) By December 81, 1979, the Borrower shall x determine the amount due to SNEC, under the concession agreements between the Borrower and SNEC, as a contribution to the cost of the take-over of the water supply systems In secondary urban centers currently operated by SNEC. (b) By June 30, 1981, the Borrower shall settle, in x CFAF NO mlIon accordance with arrangements acceptable to the paid In 1982 of Bank and SNEC, the amount determined to be due which CFAP 269 to SNEC in accordance with paragraph (a) of this million for (a) Section as well as the amount of two hundred abeve. forty million CPA france (CFAF 240,00,M) due to SNEC on account of the take-over of the water supply systems of Douala and Yaound6. PROJECT AGREEMENT 8.02 SNEC shall establish, by December 81, 1979, and X But not thereafter maintain an internal auditing and satisfactory. management control unit with such functions, authority and staffing arrangements as shall be satisfactory to the Bank. 8.08 SNEC shall take out and maintain with respon- X sible insurers, or make other provisions satisfactory to the Bank for, insurance against such risks and in such amounts as shall be consistent with appropriate practice. - 23 - SECOND WATER SUPPLY PROJECT, LOAN 1763-CM ANNEX III Compitance with Covenants (continued) Page 8 of 7 Section Covenants Met Not Met Comments 8.04 SNEC shall at all times take all steps necessary X to maintain Its corporate existence and the right to carry on Its operations, including the Parts of the Project for which It Is respon- sible, and shall take all action necessary to acquire and to retain such land, Interests in land and properties, and to acquire, maintain and renew such concessions, licenses, consente, franchises or other rights as may be necessary or useful for the execution and operation of the facilities included in said Parts of the Project and the conduct of its business. 8.05 Except as the Bank may otherwise agree, SNEC X shall not sell, lease, transfer or otherwise dispose of any of Its property or assets except in the ordinary course of business. 3.06 (a) SNEC shall review with the Borrower the X existing concessions agreements between the Borrower and SNEC and take all action within its powers to standardize and simplify the con- cession arrangements and to provide for the expansion of the water supply systems operated by SNEC in such agreements, all as provided in Section 4.62 (a) of the Loan Agreement. (b) SNEC shall duly comply with Its obligations X There has been no under any concession agreement between the change in conces- Borrower and SNEC. The Borrower, the Bank and sion agreements. SNEC shall periodically exchange views on the execution of the concession agreements and any further amendment, suspension or abrogation thereof or addition thereto which would be desirable in order to Improve the efficiency of SNEC's operations. FINANCIAL COVENANTS: 4.01 (a) SNEC shall maintain records adequate to reflect X See Para. 5.01 In accordance with consistently maintained appropriate accounting practices Its operations and financial condition. Starting with the fiscal year ending on June 80, 1980, such records shall in particular include, without limitation to the generality of the foregoing, balance sheets showing all the assets of, or operated by, SNEC, including those financed by the Borrower or consumers. - 24 - SECOND WATER SUPPLY PROJECT, LOAN 1768-CM ANNEX III Compliance with Covenants (continued) Page 4 of 7 Section Covenants Met Not Met Comments (b) SNEC shall retain, until one year after the X Closing Date, all records (orders, invoices, bills, receipts and other documents) evidencing any expenditures for Parts A through C (1l) of the Project on account of which withdrawals are requested from the Loan Account on the basis of certificates of expenditure, and shall enable the Bank's accredited representatives to examine such records. 4.02 SNEC shall: (1) have its accounts and financial Partially mt. statements (balance sheets, statements of income (1988 Audited and expenses and related statements) for each Accounts not l*t fiscal year audited, in accordance with appro- in.) priate auditing principles consistently applied, by independent auditors acceptable to the Bank; (i) furnish to the Bank as soon as available, but in any case not later than six months after the end of each such year, (A) certified copies of its financial statements for such year as so audited, and (B) the report of such audit by said auditors, of such scope and in such detail as the Bank shall have reasonably requested including, without limitation to the foregoing, a separate opinion by said auditors in respect of the expenditures and records referred to in Section 4.01 (b) of this Agreement as to whether the proceeds of the Loan made available to SNEC and withdrawn from the Loan Account on the basis of certificates of expenditure have been used for the purpose for which they were provided; and (111) furnish to the Bank such other Infor- motion concerning the accounts and financial statements of SNEC and the audit thereof as the Bank shall from time to time reasonably request. 4.03 Starting with the fiscal year ending on June S0, X 1980, SNEC shall not any longer make provision for an gAmortlesement de Caducit and shall apply one single annual depreciation and renewal charge calculated on the basis of the current value of ail fixed assets of, or operated by, SNEC in accordance with methods acceptable to the Bank. - 25 - SECOND WATER SUPPLY PROJECT, LOAN 1768-CM ANNEX pl Compilence with Covenants (continued) Page 5 of 7 Section Covenants Met Not Met Commentas 4.64 (a) 8INEC shell take all measures (including, but not X limited to, proposals to the Borrower for in- creases in SNEC's rates) required to enable SNEC to earnt (1) sufficient revenues to cover the operating expenses of its water supply systems; and (11) except as the Bank may otherwise agree, an annual rate of return of not less than 4 in the fiscal year ending on June a0, 1980, not less than 5 In each fiscal year thereafter until June 80, 1983, not less than 65 In the fiscal year ending on June 80, 1984, and not less than 7X in each fiscal year thereafter. (b) For the purpose of this Section: (1) the annual rate of return shall be cal- culated In respect of each fiscal year, In terms of a percentage, by dividing the net operating revenue plus all other net Income of SNEC for the year, from whatever source, by the average of the current values of the net fixed assets in operation at the beginning and the end of that year; (Ii) the term 'net operating revenue' means the difference between SNEC's: (A) grose operating revenues, and (6) operating expenses; (111) the term 9operating expeneseO means all costs of operation by SNEC of Its water supply system, including adequate maintenance expenses and adequate provision for depreciation (cal- culated in accordance with methods acceptable to the Bank) and for taxes or payments to the Borrower in lieu of taxes, if any, but excluding amortization of, and Interest and other charges on debt; and (iv) the term 'current value of not fixed assets in operation' means the gross value of all fixed assets operated by SNEC (including customer connections) less accumulated depre- ciation, both as revalued from time to time in accordance with methods of valuation acceptable to the Bank. 4.05 Until compfetlon of Parts A, 8, and C (1) of the X In 1986, SNEC Project, SNEC shall not undertake any capital constructed a new investment other than the Project estimated to N.Q. building for cost more than the equivalent of one million about USS2.5 M dollars (81,09,000) in the aggregate per annum, equivalent. unless the Borrower and the Bank have reached an understanding on such investment. - 26 - SECOND WATER SUPPLY PROJECT, LOAN 1763-CM ANNEX III Compliance with Covenants (continued) Pag. 6 of 7 Section Covenants Met Not Met Commente 4.66 (a) Except as the Bank may otherwise agree, SNEC X shall not incur any debt, other than for financing Parts A, 8, and C (1) of the Project, unless Its net revenues for the fiscal period ended prior to such incurrence, whichever Is greater, shall be not le than 1.5 times the maximum debt service requirements for any succeeding fiscal year on all debt, including the debt to be incurred. (b) For the purposes of this Section: (1) the term Odebt means any debt of SNEC maturing by its terms more than one year after the date on which it is originally incurred, including debt for the service of which SNEC Is responsible and debt guaranteed by SNEC; (Ii) the term Qn*t revenues$ meane gross rev- enues from all sources, adjusted to take account of SNEC's rates in effect at the time of the incurrence of debt even though they were not in effet during the fiscal year or twelve-month period to which such revenues relate, less all operating and administrative expense* and pro- vision for taxes, if any, but excluding provisions for depreciation and debt service requirements; (III) the term Odebt service requirements* means the aggregate amount of amortization (including sinking or purchase fund payments, if any) of, and Interest and other charges on, debt; (Iv) debt shall be deemed to be incurred: (A) under a loan contract or agreement on the date of such Loan contract or agreement, and (B) under a guarantee agreement, on the date the agreement providing for such guarantee hee been entered into but only to the extent the guaran- teed debt is outstanding; and (v) whenever it shall be necessary to value, in terms of currency of the Borrower, debt payable in another currency, such valuation shall be made on the bests of the prevailing rate of ex- change at which such other currency is, at the time of such valuation, obtainable for the purposes of servicing such debt or, if such other currency is not so obtainable, at a rate of exchange acceptable to the Bank. - 27 - SECOND WATER SUPPLY PROJECT, LOAN 1768-CM ANNEX III Compliance with Covenants (continued) Page 7 of 7 Section Covenants Met Not Met Comments A.07 SNEC shall annually prepare and furnish to the Partially met. Bank, by June 89 of each year, financial pro- Only submitted one jections for the next succeeding five fiscal (in 1988.) years in order to assess and plan the future development of its financial condition. - 28 - ANNEX TV REPUBLIC OP CAMEROON SECOND WATER SUPPLY PROJECT, LOAN 1763-CM PROJECT COMPLETION REPORT Dlsburement Schedule * *ooceacce~~~~ gag g 8 t-------------------- --- 2 e X 4 WOe 00 8e l ? . ... . . . . . . . . .- d N -- -- - - - C cp 0 0 r-T-= uolII,w s n 04b noa 4 in . g 4 m - -A 0* mo° e ce Ji- - -~1 -u001 fin ig Igs £11 wal ii1~ enotfinje må~ i 1 1 1 pi! p581 :l 19 3511*0 !kis 1112!133 1 11 il - I de 4 1 c. i§mej§ I-e om-s på - - 30 - ANNEX V-2 ~SEG VAm amL li2T L8AN 1718-CM Soåttd Whiaa d=m aug du Camun tSMM omta= aha 1/ ASSETsZ Apra eal Aca o pa A4 Achum§ l lAGtM Approilal Actual Appraial Actuel Appraeal Act0 ---1979 ~ 1979/0 1o/m 10/m 0191/ 1l/GR iuo 9l2a 1918/84 1~/84 1984/85 19%4/85 a/ Concion: Overnanh 7 078 6 842 10 489 1 4-0 26 254 8501 s8i 4/ 34 800 se18 48 00 88N 54 012 S 901 07778 13 8 077 1/ 100 184 2/ Oaprciabion (Caducit.) (5 1u7) (903) (7 R2M> (1 OIK. 09 0> (1 0) (18 83> (1 451) (17 672) (1 71> (28 103) (1 404> Ne6 294 11-75 835979 18 110 4410 16190 84-455 20240 406 2488 77 01 34017 OtherAamat. 777 1 077 1013 2076 9 520 13 188 Daprecishin (83) (48) (C7) (900 (1 M) (2 873) Nma 421 tig 9a 1 167 7 9W 10813 F;Med Aata-in oration 29 48 12 200 35 979 13 731 44 19M 16 128 4 488 21 413 68 405 32 878 77 081 44 830 -under Canr. 2284 443 185 884 28 42 712 2951 4126 355 2 40 4 7 4 179 -other 0 174 0 347 0 m00 0 329 0 259 0 50 TOTAL FDÐ ASSES 1 62? 12 37 80 14 Z17 40 73 17 819 57 400 25 068 09 260 35 477 a1 410 49 8m Inventory 748 1 140 777 2101 973 3078 1219 390 1 309 4 730 1 82 5291 Receivaa 1 43M 1318 168m 3490 1940 4854 a 0 8340 2748 a 08 821 10957 0ukful Receivabie l ) (141 ( ) ( 4(01 SONEL W N8G i 21P1(2aV41 Other 761 719 82 1 144 900 2 8m 1072 2417 1 206 1085 1 88 3549 Cash&84nk 1 330 44 1 00 125 18 a 80 7a5 s 1927 215 2211 94 TOTAL c~.Ut ASSES 4 278 4 10 4 712 7 730 8 408 11 711 0 806 14 984 7 387 17 489 8 902 25 424 TOTAL ASSETS: 35 902 17 012 42 250 22 8=8 82 141 29 080 88 711 40 76647 52 916 90 332 72 968 UABILITUES & EJIT7: Share Capital ~ 800 ö 00 500 800 800 1 00 800 1 800 800 1 500 500 1 500 Retaingd EarnMna 1 80 139 2 0a 98c 4 M81 294 0 518 88 9 208 (111) 13 119 (249) öau. Suventiono 14 6G 7 075 18 137 0251 16 0m 18378 16 918 18 470 18 087 2( 153 19 448 29 800 Lang tara deb 7 880 2195 9074 2013 1254 1 83 16 699 4721 20165 7 70 21 735 13 964 Prouiiaon for Renmol 2 88 4 24 2741 5 209 71 27 2376 7816 2 11 9 44 1901 12 37 Rovaluation Reervaa 7264 0 10 218 13816 18 235 2 81 30222 TOTAL LIADILITI/Jw 34 428 14 184 40 478 17 0 0 047 ii=8 Z61 41 88i3= 73 740 41 85 88 922 57 480 Other Proviaiona 360 14 484 30 0s 40 800 0 679 0 788 0 Account PyabeI 449 982 88 18 40 730 2 e 914 8 04 1 131 4 798 1 374 8 812 Other Creditora inci. S^i. 175 1 058 198 2 204 212 2 218 284 8 170 257 4 503 283 5 178 shor a trm port L.T. de6 00 878 872 868 198 380 Short term debh 491 414 862 297 047 284 782 394 840 1 667 65 4 463 ajU ABILITI 5 1475 288 1 772 47444 2 000 8794 2 470 748 2907 11 361 8410 15408 TOTAL LIABIlTIES & EOW : 35 901 17 012 42 250 22 888 82 141 29 080 63 711 40 2 76 647 82 916 90 832 72 968 . -.. - - --so.... a.mmmee... os.• •mm.w.....m.. - - - - -. -- - Current Rehiom: 2.90 1.47 2,66 1.74 2.8 2.02 2.85 2.01 2.54 1.53 2.62 1.51 Dah/Equity Retioo: 0.25 0.46 0.28 0.67 0.19 0.97 0.16 0.56 0.15 0.44 0.16 0.30 1/ Aud;itcod. 2/ Annual Roc no longar differentiate bot~een ty~e of masets. 3/ Th 1984/85 Audib Repot del iver* a qual fied statman6 only 64 saer*Ing thet. oving to e number of dIfci.n.ls in the accunte, fonancial *tat~emnte do not accurately reflech ~*' financial situation as of June 30 (Se. chater V). 4/ Appraical Ror doen not differntate batmaen type of fi*xed amta. alit .l ili ils iii a i fi i i | tt r Itfiié |Ilisi il i i il 1 i i ä 09. |alÖiiss l i 118 11 i ii |l*lni ils-mIils ikll ii91 |l0li-i 5 il 1 i i ii ä lhliis, is i l iiilailåsä il äg - 82 - ANNEX VE-1 REPUBLIC OF CAMEROON SECOND WATER SUPPLY PROJECT LOAN 1758-CM PROJECT COMPLETION REPORT Service Level in Douala and Yaound 1978 1988 Actual SAR Estimates Actual Douala 1. Total Population 584,000 (160) 1,259,60 (108) 698,000 (10) 2. Population Served 310,000 (54) 944,000 (75) 477,000 (62X) ** Private Connections 115,000 (20%) 832,000 (285) 267,000 (80W) -- Yard Connections -- -- 240,000 (195) -- * ** Standpipes 200,000 (34) 372,000 (8B) 201,000 (22X) 3. Number of Connections 11,600 88,000 26,700 -- of which Yard Connections -- -- 8,000 -- -- - 4. Number of Standpipes 229 820 230 Yaound6 1. Total Population 873,000 (1003) 748,60 (1003) 684,006 (1003) 2. Population Served 208,000 (543) 657,000 (753) 317,000 (493) -- Private Connections 129,000 (35) 289,000 (323) 26,000 (BOW) ** Yard Connectiong -- -- 96,000 (18) -- -- -- Standpipeas 74,000 (19X) 222,000 (80) 62,000 (163) 8. Number of Connections 12,900 31,000 25,5600 -- of which Yard Connections -- -- 8,200 -- -- -- 4. Number of Standpipes 85 370 71 - 33 - ANNEX VI-2 Page 1 of 2 REPUBLIC OF CAMEROON SECOND WATER SUPPLY PROJECT LOAN 1753-CM PROJECT COMPLETION REPORT Economic Analysis A. General ERR calculations have taken into accounts (i) as benefits, the additional revenues accruing to SNEC from incremental consumption generated by the project; (ii) as costs, project's capital costs and the additional operating costs corresponding to the incremental consumption. Calculations are carried out over a 30 year period after commissioning of the facilities. Renewal of equipment (excluding civil works and pipes) is expected to take place 15 years after this date. A discount rate of 10 percent has been used in the present worth calculations required to determine AIC. B. Incremental Consumption Douala and Yaoundd The incremental consumption derives from the potential number of new customers connected to the network. This number is assumed to be in proportion with the length of distribution pipes laid under the project. Secondary Centers In the five centers (Bafang, Buea, Limbe, Mamfe, Tombel) where an adequate network existed before the project, the incremental consumption in 1986 is assumed to be in proportion with the share of the number of connections installed under the project in the total number of connections. In other centers, the 1986 consumption has been estimated using an average yearly consumption of 240m'/connection and of 2,500m/standpipe. Consumption is expected to grow at 8 percent rate. The growth of the incremental consumption is limited by the production capacities installed under the project. C. Capital Costs Capital costs are investment costs of works executed under the project. The following deflators have been used to calculate costs at mid 78 prices: - 34 - ANNEX VI-2 Page 2 of 2 Year: 1978 1979 1980 1981 1982 1983 1984 1985 1916 Deflator 1.00 1.06 1.14 1.26 1.43 1.61 1.81 1.95 2.09 D. Incremental Operating Costs Variable costs (electricity and chemicals) and personnel costs have been estimated from SNEC 1985/86 budget for Douala, Yaoundd and the five existing centers. A cost of CFAF 10/m3 (at mid-78 prices) has been charged to the eleven other centers where personnel costs are assumed to be CFAF 5 million/year. Yearly maintenance ccsts amount to one percent of the capital cost of civil works and pipes and 3 percent of equipment installed. E. Results Results of the ERR and AIC calculations are provided by the following table, along with the net benefits st-eams for each center. •”一迎吧邑黑挫 纏華華華華奪華•“&“丰擊‘安“寫‘言屆華•”丰華••群丰．離．擊彎’華 藝謝‘&&&&&&&&&&&&&&&&&&&&&&&&”莖 讓排’&&&&&&&&&&&&&&&&&&&&&&&&&&&&”聖 巒．，…•，．一。，,．。，..-.．一，。一•－－一。騙二 韻輯寧’&,&“呂””細長鑰鳥賽華丰•”華•釁蒼釁擊擊擊擊擊釁釁”安“ ,&”。，,”一”細～-－…“。鴉－.0．••••••••••悶，. 曰祠聖但靈中坤究．,．•舛‘個閑界唱州個．．•’口哺，，州•日間d，磚•曰個D口口口口口口口口口•口•口口個自口口口口口口，．徑聖個巴 廉，千？～二～一一，-----------－一甲零‘ 一，二，…細．~－一，,&～。，一。••－---－一。－一。悶•， 蓬’?&.，一當 ，平華寧”&&&&&&’甲”&&&&&&&&&&&&”華藝邑 論 ，華華華‘&&&&&&&&&,,&&&&&&,&&&,’徒“ .,,,&&&&&&’。一，’一’‘•一二””二二二”}&- 徑，騙奮甲甲。”&&,&，卜卜““覃戶h．、，州冉卜卜卜‘卜卜州州叮聖霎― 董，,”·？一― 認＿一― &&.0一0,&&,．州一。．”••••－一••••••。••一。啊，&- 藝丰”&－一，----------－一妒’&- 。，&&”。一”一”一•一二’&&&&&&&&&&&&&&&,- 仕一‘•；&，一，,”•••••••斗－－一••一••一•••一三呂名― 讓。’·”二一― 蠱。””一’一•’&&&&&&&&&&&&&&&&&&‘寫，&1 1.&&&”一”’一’一•一”•••一•一•”一•一學”，〕 1.&&&&‘•’二”&&&&&&&&&&&&&&,- i〔’&&&&&&&&&&&&&&&&&&,&,1 曰一－一～•－－二，.－一•－-.&.,，一，,．一•一。。－－一潤州“l 一戶，•中他員面面j面e閱州唱．吃•妒個馴叫口．’口口口口口•頗口口•口口個口口口個口口口個口個口個口口口口口個口個口唱開•口～豐至豐乞乏■ 話。？&”一”一― 日一－--.--．一。一•．－一•－-.&&&&．•••必•．•。紹，。l 膩屆口巨州豆自中．．•目．邊口唱e闢鉀•仰唱個甲目奮目，口澗口唱口，口，口，口，煙，個，口，口，•，藝，唱，口，•，•，』之三豐乏甲l 豐里，”、？▼＿一― -－一遛l 一跑■ 屆它l 日－------------------------－一。－一。：呈藝― ＿餐雙註整雙號要雙實賽秀細藝秀藝熙藝藝鳥賽秀賽雜濺凡濺號發濺濺濺養羈騙萬；合斤― 日口彎霎軍I ’一―