Somalia - Technical Assistance For the Baardhere Project

Document Of The World Bank FOR OMCIAL USE ONr Rep No. 12093 PROJECT COMPLETION REPORT SOMALIA TECHNICAL ASSISTANCE FOR THE BAARDHERe PROJECT (CREDIT 1856-SO) JUNE 28, 1993 MICROGRAPHICS Report No: 12093 Type: PCR Agriculture and Environment Operations Division Eastern Africa Department Africa Regional Office 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 EQUWALENS 1987 JS$ 1 = So.Sh. 105.2 1988 US$ 1 = So.Sh. 170.5 1989 US$ 1 = So.Sh. 490.7 ABBREVIATIONS GOS GovLllment of Somalia GTZ German Aid Agency IDA International Development Association MJVD Ministry of Juba Valley Development USAID United States Agency for International Development GOVERNMEN FISCAL YEAR January 1- December 31  FOR OMCIAL USE ONLY THE WORLD BANI Washington, D.C. 20433 U.S.- Office ox' Director-General Opefatons Evaluation June 28, 1993 MEMORANDUM TO EXECUTIVE DIRECTORS AND THE PRESIDEN. SUBlJECT: Project Completion Report on Somalia - Technical Assistance for the Baardhere Project (Credit 1856-SO) Attached is the Project Completion Report on Somalia - Technical A.istance for the Baardhere Project (Credit 1856-SO) prepared by the Africa Regional Office. Part II of this report, normally preparea by the Borrower, is missing because of the political disruption in Somalia. The main objective of this IDA project was to provide technical assistance (TA), mainly via the financing of studies and expatriate advisors, to the Ministry of Juba Valey IDevelopment (MJVD) with a view to completing preparation/design of the Baardhere Project (The Baardhere Project involves the construction of a large dam, with related hydropower and irrigation facilities, in the Juba Valley of Somalia). The IDA TA project also had an institutional development (ID) component (mainly training) aimed at strengthening MJVD's capacity to manage project implementation. According to the PCR, the TA project was on the whole successful because it did in fact achieve its main objectives of determining the feasibility of the Baardhere Project and completing its preparation. A twinning arrangement between MJVD and an engineering services organization was evidently a successful one, and the studies, training and other activities were carried out expeditiously. The near-term institutional development impact is rated as partiaL In the event, however, deteriorating conditions in Somalia completely halted work on the Baardhere Project While it is unusual for a Bank/IDA project to warrant an overall rating of satisfactory even though sustainability of benefits is unlikely, this is such a case. Because of abnormal country circumstances, it is understandable that the PCR should not be complete. However, even making allowances for these circumstances, a number of important issues related to Borrower involvement in project preparation, "ownership" and lessons learned could have been treated more thoroughly. Given country conditions, no audit is planned at this stage. Attachment I This document has a restricted distribution and may be used by recipients only in the r smance of their official duties. Its contents may not otherwise be diclosed without World Bank authorization.  FOR OFICIAL USE ONLY PROJECT COMPLETION REPORT SOMALIA TECHNICAL ASSISrANCE FOR THE BAARDHERE PROJECT (CR.1856-SO) TABLE OF CONTENTS Pame No C8fu .............. . . . . . . . . . . .. . . . . . . . . . . i EvluatonSummary iii PART I: PROJECT REVIEW FROM BANK'S PERSPECTIVE .. I P,ojectIdentity .. 1 Background .1. Projec Objectives and Description .. 2 Projec Design and Organization .. 2 Project Implementation ..... 2 Projec Results .. 3 Sustainability .. 3 IDA Performance .. 3 Bonower Perfrmance .. 4 ConsWting Services .. 4 Project Relationship .. 4 Project Documentation and Data .. . 4 Lessons Learned .. 4 PART U: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE .. 6 PART III: STATISTICAL INFORMATION .. 7 1. Related IDA Credits . 7 2. Poject Thetable .. 8 3. Credit Disbursement .. 8 4. Projet Implemetaon .. 9 S. Project Costs and Financing .. 10 6. Project Results .. 11 7. Status of Covenas .. 13 8. Use of Bank Resoure .. 14 This document has a restricted distribution and may be used by recipients only In the performance of their official duties. Its contents mny not otherwise be disclosed without World Bank authorization.  i - PROJECT COMPLETION REPORT SOMALIA TECHNICAL ASSISTANCE FOR THE BAARDHERE PROJECT (CREDIT 1856-SO) PREFACE This is the Project Completion Report for Technical Assistance for the Baardhere Project in Somalia for whirb C.redit 1856-SO in the amount of SDR 4.3 million (US$5.5 million equivalent) was approved on December 1, 1987. Due to the civil war in the country the project was suspended in March 1991, nine months before the official closing date of December 31, 1991. SDR 1.1 million remains undisbursed. The last disbursement was made on April 30, 1991. Parts I and m of the report were prepared by the World Bank's Agriculture and Environment Oparations Division, Country Department II, Africa Regional Office. A draft could not be sent to the Borrower for comment. Due to the security situation in Somal!a, no field visits could take place. The report was based on the President's Report, Development Credit Agreement, supervision reports, correspondence betwecn the Bank and Borrower, and internal Bank memoranda.  - iii - PROJECT COMPLEION REPORT SOMALIA TECHNICAL ASSISTANCE FOR THE BAARDHERE PROJECT (CRlDfT 1856-SO) EVALUATION SUMMARY Introduction 1. At the time of project formulation, only 8.5% of Somalia's cultivable land was cultivated, with water being the main constaint. Studies showed that new irrigation investments would ensure a sustainable anual growth in crop production of about 5%. The construction of a multipurpose dam on the Juba River at Baardhere was identified as the main potential for irrigation and hydropower. IDA and several other donors financed preparation of a number of pre-;nvestment studies but in 1987, an IDA mission to Somalia fund that the preparation process was encountering serious issues from lack of coordination and supervision. The mission proposed a technical assistance credit to assist in completing preparation of the Baardhere Project. Project Objectives 2. By providing technical assistance and training, the project was to strengthen the institutional capacity of the Ministry of Juba Valley Development (MJVD) to complete the preparation of the Baardhere Project and to determine its feasibility and financing so that a sound decision could be taken about implementation. The project included the remaining studies and specialist inputs needed to complete preparation of the Baardhere Pioject, and was to strengthen MJVD's capacity to make a significant contribution to the project's implementation in the event of a decision to proceed. Project lmplementation 3. The credit became effective April 1, 1988. MJVD signed a contract establishing a twinning agreement with an engineering services organization. The arrangement was to enable the Somalis to benefit from the agency's experience, facilitate the recruitment of short-term specialists, provide Somali staff with short-term on-the-job training, and support MJVD's capacity to administer and supervise consultants engaged in planning and design. Ihe final team comprised three Somali specialists (team leader, irrigation engineer, and economist), and two expatriate specialists from the twiming organization (dam and specifications engineer). Project vehicles, office equipment, furniture and supplies were procured. Review of contractor applications to qualify for the civil works construction followed soon afterwards. A total of 13 trainees were placed in overseas MSc courses and 11 project staff participated in short-term training in various countries. 4. One problem encountered by the project was the lack of counterpart funds for operating costs. To overcome the problem, the Credit Agreement was amended to include a new category of expenditure for opeaing costs so that IDA funds could be .-eallocated for this purpose. To completf the  - iv - environmental work and training program, GOS requested a one-year extension of the credit closing date to December 31, 1991, which was granted by IDA. However, shortly afterwards, the Government was overthrown and the Bank group suspended all credits to Somalia. A number of suppliers could not be paid for goods delivered because there was no govermnent to authorize disbursement. Projedt Results 5. The Project achieved its objectives of completing the preparation of the Baardhere Project and determining its feasibility. Reports produced covered topics such as: drainage and salinity control, hydrological sedimentation and water quality, ro^kfill embankment alternative design, power optimization, economic and macroeconoinic analysis for the dam project, surveys of bench mark on the dam site, tender documents, and prequalification for civil works contractors. Those studies concluded that the dam was an ecoaomical solution for water and power provision in southern Somalia. Other studies addressed crucial issues related to the construction of the dam: riparian rights, resettiement, health hazards, water use legislation, land tenure legislation, refugees, environment. Sustainability 6. Since the Baardhere Project is not expected to take place in the foreseeable future, the technical assistance credit will not have any sustainable impact on the country. Lessons Learned 7. Due to the civil war, disbursement could not be completed and a number of goods suppliers who had not taken insurance against the political risk were not paid by either the Government (which no longer existed to issue withdrawal applications from the credit) or their country's export credit insurance. In view of the worsening political situation of the country, and anticipated evacuation of international personnel, IDA might have instructed the resident mission and the last supervision mission to concentrate on the project's financial management, including reconciliation of the special account, and clearing outading payments so that they could be settled before the country plunged into anarchy - the uniquely dramatic and lasting nature of which was admittedly difficlat to predict. This is a major lesson to be learned by IDA and suppliers of goods and services in countries experiencing serious social and political instability.  PROJECT COMPLErION REPORT SOMALIA TECHNICAL ASSISTANCE F'OR THE BAARDHERE PROJECT (CR.1856&SO) PART I: PROJECT REVIEW FROM BANK'S PERSPECTIVE Project Identity Name Tecbnical Assistance for the Baartdere Project Credit Number 1856-SO RVP Unit Africa Region County Somalia Sector/Subsector Agriculture Background 1. Of the 638,000 sq km of Somalia's land area, only 13% is suitable for cultivation. Ot this, only 8.5% was cultivated at the time of project formulation, with water being the main constaint. Studies showed that n irrigation investments would ensure a susainable amnual growth in crop production of about 5%. At the time of project formulation, the constuction of a multiprpose dam on the Juba River at Baardhere was identified as the main potental for irrigation and hydropower. The Baardhere Project, a complex and costly operation etimated at $300 million, was part of Somalia's public investment program and a key component of the national development strategy for both the agriculture and power sectors. 2. Various feasibility stdies carried out in the 1970s had reconfirmed the priority of the Baardhere Project. These studies were completed for constuction of a concrete dam. IDA agreed to assist the Government of Somalia (GOS) in completing project preparation and, subject to appraisal findings, to finance the project with other donors. In preparation for this, IDA financed studies of future institutional arrangements, flood protection and resettlement needs, USAID financed an environmentai and social assessment, and GTZ carried out a master plan for development of the Juba Valley. Detailed design for an alternative rockfitl dam was also undertaken with Chinese assistance. 3. Almost all the water flowing ia the Juba River in Somalia is derived from its catchment area in Ethiopia and partly in Kenya. To assess whether the proposed Baardhere Project would be adversely affected by water use in Ethiopia, IDA requested Ethiopia to provide details of its water use plans within the Juba River catchment, and contracted consultants to update an earlier review of likely future use of Juba River water within Ethiopia. This review, together with other studies conducted by various consultants, concluded that even reduced flows of up to 33 % would be unlikely to jeopardize the project's viability.  -2- Project Objectives and Descriptlon 4. Project Objectives. By providing technical assistance and training, the project was to strengthen the institutional capacity of the Ministry of Juba Valley Development (MIVD) to complete the preparation of the Baardhere Project and to determine its feasibility and financing so that a sound decision could be taken about implementation. The prk jee Icluded the remaining studies and specialist inputs needed to complete preparation of the Baardhere Project, and was to strengthen MJVD's capacity to make a significant contribution to the project's implementation in the event of a decision to proceed. 5. Project Description. The main project component was the establishment of a Core AdvLtory Team within MJVD, consisting of six qWiified Somali sponalists and three expauiate resident advisors, supported by short term consultants. Tne advisory team was to assist MJVD in supervising consultants studies and completing preparation of the Baardhere Project and its appraisal by IDA and other donors. The project was to provide funds for technical assistance, training, vehicles, transit accommodation and storage, firniture and equipment and incremental operating costs. Project Design and Organiation 6. IDA involvement in the Baardhere Project began in 1983, whea the proposed Juba Valley development program was under review. Later on, when the selection of the dam was reconfirmed as a priority, IDA fmanced several studies leading to project preparation. In March 1987 an IDA mission visited Somalia to supervise the preparation of the Baardhere Project, and found that the preparation process was encountering serious issues, inparticularunsatisfactory supervisionofthepreparationprocess and weak donor coordination by GOS. In its Aide Memoire the mission proposed a technical assistance credit to assist in completing preparation of the Baardhere project. The proposal was in line with Government's desire to complete preparation of the project. 7. The technical assistance project was negotated in Washigton in October 1987. The negotiations did not result in any changes in the project. IDA financed US$5.5 million out of a total project cost of $5.8 million. The project was to be implemted over a 30 month period by MJVD. During negotiations, it was indicated that, subject to progress of the technical assistance project, appraisal of the Baardhere Project could take place at the end of 1988. Project Implementation 8. The Credit became effective April 1, 1988. The hiring process for the advisory team started promptly thereafter. MJVD negotiated a contract estabishing a twinning agreement with an engineering services organization. The arrangement was to enable the Somalis to benefit from the agency's experience, facilitate the recruitment of short-term specialists, provide Somali staff with short-term on-the- job training, and support MJVD's capacity to administer and supervise consultants engaged in planning and design. IDA cleared both the agreement and the experts proposed by the agency. In May 1988 GOS appointed a Somali expert as team leader. By October 1988 the expatriates were in place, and M1VD had already started interviewing Somali candidates for the economist and ifrrigation engineer posts. Once fully established the final team comprised three Somali specialists (team leader, irrigation engineer, and economist), and two expatriate specialists from the twinning organization (dam and specifications engineer).  9. The Advisory Teau began the procurement process in August, 1988. By October of that year the project vehicles had already arrived 'n Mogadishu. Office equipment, finxiture and supplies, were procured locally. Review of contractor applications to qualify for the civil works construction followed soon afterwards. 10. Selection of suitable candidates for training under the Credit started soon after effectiveness. A tota of 13 trainees were placed in overseas MSc courses in various disciplines. At the same time, a program of short term training for 11 project staff was carried out at universities in several countries. A six-month course to improve English language proficiency of project staff was completed in 1990. 11. One problem encountered by the project was the lack of counterpart funds for operating costs. To overcome the problemn, the Credit Agreement was amended to include a new category of expenditure for operating costs so that IDA funds could be reallocated for this purp-4se. 12. To complete the environmental work and training program, GOS requested a oneyear extension of the credit closing date to December 31, 1991, which was granted by IDA. However, shortly afterds, the Government was ovehrown and the Bank group sus.oended all credits to Somalia. The project could not be completed and no follow up was possible on the Baardhere Project. Project Rults 13. The project achieved its objectives of completing the preparation of the Baardhere Project and detemining its feasibility. From April 1988 to December 1990, various consulting groups produced reports related to Baardhere Project preparation, including topics such as: drainage and salinity control, hydrological sedimenation and water quality, rocdfihl embankment altenative design, power optmizaton, economic and macroeconomic analysis for the dam project, surveys of bench mark on the dam site, tender documents, and prequalification for civil works contractors. Those studies concluded that the dam was an economical solution for water and power provision in southern Somalia. Other studies addressed crucial issues related to the construction of the dam: riparian rights, resettlement, health hazards, water use leglation, land tenure legislation, refugees, environment. 14. The advisory team was actively involved in supervising and coordinating the various consulting groups and donors, and in reviewing all the studies produced by consultants, including the engineering studies, the economic analysis of the proposed project, tender documents, prequalification of contracts, and supervision of tendering procedures. The advisory team reached the conclusion that all the studies produced left no doubt as to the economic feasibility of the Baardhere Project. Susanability 15. Since the Baardhere Project is not expected to take place in the foreseeable future, the technical assistance credit will not have any sustainable impact on the country. IDA Performance 16. After many years of discussions and investigations into the feasibility of the dam, it became evident that lack of supervision and coordination had become a major cause of delay. The Association therefore identified the need for technical assistance to speed up preparation of the Baardhere Project.  -4 - The project was simple and well designed, and was processed quickly. During implementation, there was constant dialogue with the Government and clse correspondence with the project team. The performance of supervision missions and the Bank office in Mogadishu was satisfactory. 17. A total of four supervision missions were fielded between April, 1988 and November 1990, with good staffing continuity. After the initial period of project implementation, when efforts were put on the establishment of the advisory team, supervision missions focussed on the completion of the preparation studies for the Baardhere Project as described above, and on outstanding issues associated with the construction of the dam, such as riparian rights, resettement and environmental aspects. The last supervision mission was carried out in November, 1990. It reported a deterioration of the security situation in the country. Extensive areas had become inaccessible, and there was a high incidence of violence, with little or no law enforcement. In retrospect, the mission should have concentrated on supervising the project's financial management, including reconciliation of the special account and clearing outstanding payments to suppliers. This could have reduced the number of suppliers that could hot be paid for goods delivered once there was no longer a government to authorize disbursement. This situation, which would have been difficult to predict, still prevails at the time of the writing of this report. Borrower Plerformance 18. Borrower performance was satisfactory especially in light of the political and security deterioration during project implementation. The lack of counterpart funds was a major problem but all other credit covenants were in compliance. Consulting Services 19. The performance of the advisory team was good. In a letter to the Minister oV National Plannng, dated November 1988, IDA praised the advisory team for the progress it was making in completing preparation of the dam project, and for its diligence in preparing monthly reports that were said to be most informative and useful to all potential donors. Proje Relationship 20. IDA's relat;onship with MIVD and other parts of Goverament was good. Project Documentation and Data 21. The credit agreemen: and Memorandum of the President provided an adequate framework for review of project implementation. The studies conducted under the project were available in the Bank's files. Lessons Learned 22. Due to the civil war, disbursement could not be completed and a number of goods suppliers who had not Laken insurance against the political risk were not paid by either the Govermment (which no longer existed to issue withdrawal applications from the credit) or their country's export credit insurance. In view of thi worsening political situation of the country, and anticipated evacuation of international personnel, IDA might have instmcted the resident mission and the last supervision mission to concentrate  on the project's financial management, including reconciliation of the special account, and clearing outstanding payments so that they could be settled before the country plunged into anarchy - the uniquely dramatic and lasting nature of which was admittedly difficult to predict. This is a major lesson to be learned by IDA and suppliers of goods and services in countries experiencing serious social and political instability.  -6- PART U: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE Due to the civil war, Parts I and m could not be sent to the Borrower for comment.  -7 - PART m: STATICAL INFORMATION 1. Related IDA Credits Credit 1tle Purpose Year Sta Farahaane Irigation Increase production of food and cash 1989 Suspended Rehabilitation Project crops on about 5,600 small private Cr.2063-SO farms through improvement of the (US$ 28.5 million) irrigation system and water use efficiency. Establish effective irrigation management and introduce water charge as a cost recovery mechanism to ensure the sustainability of the rehabilitation program.  -8- 2. Project Timetable Date Planned Date Revised not Actual Identification 3/1987 - 3/1987 Preparation 5/1987 - 5/1987 Appraisal - 6/1987 Credit Negotiation - - 10/1987 Board Approval - - 12/1/1987 Credit Signature - - 1/4/1988 Credit Effectiveness - - 4/1/1988 Credit Closing 1211990 12/1991 1/ 12/1991 Credit Completion 1991 2/ 1/ One one-year extension granted by IDA 2/ All operations in Somalia suspended 3. Credit Disbursement ($ million) Year Appraisal Estimaes Actual Cumulative % of Total Cumulative % of Total 1988 1.25 23 2.14 39 1989 3.61 66 3.29 60 1990 5.07 92 3.95 72 1991 5.50 100 4.26 77  -9- 4. Project Inplementation Indicators Planned Actual Recruitment of core advisory team leader and staff 1/1988 1988 Recruitment of resident advisors for core advisory 1/1988 1988 team Studies Engineering services and document revision (Documents and specifications for civi works and 2/1988 1988 power) Power optimzaton 2/1988 1988 Review of Ongoine Studies Review findings of agricultural, environment, resettlement, institutional, and power studies 3/1988 1988 Analysis of project costs, financing, and implementation arrangements 4/1988 1988 Assistance During Project Processing Assistance during donor appraisal and negotiation procedures and coordination between donors 1/1988 to 7/1990 done Contacts with panel of experts 1/1988 to 12/1990 done Trainin No.of staff receiving training n.a. 145  - 10- S. Project Costs and Finandng A. Project Costs (US$ M) Item Appraisal Estimate Actual a/ l ___________________ Local Foreign Total l Technical Assistance 0.02 2.54 2.56 l Training - 0.72 0.72 _ _ _ _l Vehicles, Furniture, Equipment 0.04 0.34 0.38 _ _l Civil Works 0.06 0.17 0.23 l Operational Costs 0.10 0.15 0.25 _ l Contingencies 0.02 0.37 0.39 _ l Refinancing of PPF and SPPF - 1.25 1.25 | Total 0.24 5.54 5.78 a/ Due to the civil war in the country, no information on actual costs could be obtained. B. Projecd Fluadng (VS$ M) Source Appraisal Estimate Revised a/ AcWal IDA Credit CBS, MOGAD. AC 1185 0.20 Civil Works 0.23 0.23 0 Veh. Furn. Equip. 0.38 0.38 0.32 Technical Assistance 2.57 2.42 1.86 Training 0.73 0.73 0.63 Operating Costs 0.15 0.13 Reflnancing of PPF&SPPF 1.25 1.25 1.12 Unallocated 0.34 0.34 0 Total 5.50 5.50 4.26 Government 0.28 0.28 n.a. Total 5.78 5.78 n.a. at Revised as of June 1989.  - 11 - 6. Project Results A. Training Disciplines No.of Staff Overseas graduate study Engineering, Economics, 13 (2 years) Irrigation, Geology Overseas short term Project analysis, 11 training (6 months or less) Dam construction and operation, Irrigation construction, Resettement, Adminisrfion of multi- purpose projects, Monitoring and evaluation On-henjob traiing in Somalia 121  - 12 - B. Studies T itle Putpose Status Impact Baardheere Dam Provide techrucal information Completed Modified or substituted Project Design necessary to understand the in 4/1987 the corresponding content Studies: Design design of revised project of the project design Report Addendum components. report. Baardheere Dam Revise the cost estimate Completed Provided revised total cost Project Tender document. in 1211988 of the project and the Design: Cost Estimate costs of each implementing stage and various contracts. Homboy Area and Update the feasibility studies Completed Reviewed various issues Smallholder Banna conducted in the past in light in 4/1987 of the project including Cultivation in the of the changed conditions in cropping pattern, farm Lower Iba Valley the Juba valley. budget, irrigation and Assessment of efficiencies, agricultural Agricultural Benefits: services, labor Homboy Feasibility availability, flood Study protection and drainage facilities, training, environmental problems. Study for Verify that the Baardheere Completed Recommended that the Optimization of power component is in 9/1988 power component of the Power Facilities economically attractive Baardheere Dam Project, Daraasadda addition to the electric system being by far more Wanaajinta Qalabka of Somalia; optimize the economic than any Tamarta electro-mechanical thermal addition to the installation, the reservoir electric system, should level and operation, be implemented as soon determine the corresponding as possible; the maximum energy production, evaluate normal water level in the the effect of possible futre reservoir can, with certain water abstractions from the reservations, be risen to Juba river upstream of the but not higher than 144 m Baardheere Dam. a.s.1.; the power facilities should be implemented in l ~~~~~~~~~~~~~~~~~~two stages.  - 13 - 7. Status of Covenants Covenant Status 3.01(a)&(b) Compliance. Government commitment to project implementation. 3.03(a) Compliance. Establish within MJVD a core advisory team by 1/1/1988. 3.05 Compliance. Submit training plan for approval. ~|