Morocco - Fez Historic City Rehabilitation

Report No. PIC877 Project Name Morocco-Fez Rehabilitation Project (@+) Region Middle East and North Africa Sector Urban Development Project ID MA-PE-5524 Borrower Kingdom of Morocco Project Coordinator Mr. Mohamed Fassi Fehri Governor, Fes Medina Fax: 212.5.63.53.09 Lead Implementing Agency Agence pour la Dedensification et la Rehabilitation de la Medina de Fes (ADER-Fs) 4, Avenue Zaid Ibn Harita Fez, Morocco Contact Mr. El Hajjami Managing Director, ADER-Fs Tel. 212.5.65.34.69/78 Fax. 212.5.65.38.83 Date initial PID prepared July 1994 Date this update prepared March 1997 Project Appraisal date March 1997 Project Board date June 1997 Background 1. Morocco's 30 medinas have been largely overlooked for much of the 20th century, since investment has been concentrated in areas outside the traditional urban centers. The result has been a serious deterioration of the historic building stock, urban infrastructure, and the urban environment. This decline has been compounded by rural migration and the exodus of the original inhabitants of the medina so that density of population in the medinas is high and income levels are often below national averages. The absence of a focused Government policy towards these historic cities and relatively low levels of investment have deterred their ability to provide satisfactory living conditions for their inhabitants. 2. A 1995 project survey indicates that 36 percent of the medina's population is below the poverty threshold, a proportion far exceeding the national average for both urban (10.4 percent) and rural (28.7 percent). Moreover, half of the housing stock is seriously decayed and housing occupancy levels surpass acceptable levels. This cycle of decline also affects the architectural heritage of Fs, despite recent efforts by Moroccan authorities to preserve selected monuments. However, data collected on the demand  for building permits to rehabilitate the housing stock, as well as on land transactions, indicate a potential for reversing the cycle of decline among all segments of the medina's population. A good indicator of the long-term benefits expected from the project is the leveraging ratio computed under the project's economic analysis. It shows that for every dollar of public funds invested under the project, more than US$3.0 will be invested by the medina's population over the long term. Project Objectives 3. The Fs Medina, a UNESCO World Heritage site since 1976 and center of Moroccan commerce and culture, has a high incidence of poverty and substandard living conditions. Under a comprehensive definition of cultural heritage as the historically built environment, encompassing the housing stock and the social structures which support it, the primary objective of the proposed project is the conservation and rehabilitation of the Medina through the empowering of its population and institutions, and by raising the national and international awareness of its cultural value. To reach this objective, the project will: (a) expand and accelerate ongoing conservation efforts; (b) consolidate partnerships between the public and private sectors, the Borrower, World Bank, and other donors; and (c) use the rehabilitation process to alleviate poverty. Project Description 4. The following components constitute the proposed project: (a) conserving cultural heritage through a variety of priority rehabilitation activities aimed at meeting community needs, upgrading the historic housing stock, and expanding the tourism offering; (b) providing priority access for emergency public services extending to the center of the medina, and facilitating logistical activities for residents and businesses, thereby creating favorable conditions for efficient urban development and private sector investment; (c) improving the urban environment and reducing poverty by instituting programs for solid waste collection and pollution reduction for small-scale industries, and creating employment through a labor-intensive public works program linked with the rehabilitation process, and training; and (d) strengthening the capacity of the municipality and responsible agencies to plan and carry out urban improvements. Benefits and Target Population 5. The target population is the residents of the medina (150,500 inhabitants), with special attention to those living below the poverty threshold (52,700 inhabitants). About one-third of the residents would benefit directly from improved infrastructure network, including an emergency network of some 14 km which would improve access to the medina for medical emergencies, fire brigades, security services, solid waste collection etc. Another direct benefit would be the creation of some 8,000 jobs over the next fifteen years, of which 50 percent would be targeted to the - 2-  poor under a specific poverty alleviation component. Benefits of the project would also accrue to various professional and artisan groups working in the medina; those individuals receiving training and technical assistance; local institutions, universities, NGOs, and neighborhood associations involved in the rehabilitation of the medina; and the tourism industry. The ultimate beneficiary, of course, would be the World Heritage city of Fs, whcih wuold benefit from the new rhythm of maintenance and rehabilitation and resulting inward investment. There would also be benefits at the national level, since the Fs experience would serve as a demonstration project that could be replicated in other medinas of Morocco. Project Cost and Financing 6. Total project cost is currently estimated at US$41.8 million, with a Bank loan tentatively placed at US$25 million. Under a grant from the Japan Policy and Human Resources Development (PHRD) Fund, an expanded program of rehabilitation, totaling US$65 million, was prepared and will be presented to a donors' conference in May 1997. During ths conference, particular focus will be put on the financing of activities which relate directly to the poverty alleviation component, including financing a line of micro-credit. Project Implementation 7. The Borrower would be the Government of Morocco (GoM) which would on-lend part of the loan to the two municipalities in charge of the medina (Fs-Medina and Fs-Jdid), and to the District of Fs (Communaute Urbaine). Among these entities, the Fs-Medina municipality is playing a key role in the day-to-day management of the medina, and would share most of the project cost with the Government. ADER-Fs was the main agency in charge of preparing the project, and will play a pivotal role during the course of the project. It will act as technical coordinator and advisor for all rehabilitation projects of historic interest. It will be in charge of the poverty alleviation component, which will be managed under a specific unit (Unite de developpement communautaire or UDC). Sustainability 8. The sustainability of project benefits will be dependent on two main factors: (i) the reaction of the medina's residents to overall improvements brought about by the project. According to this criterion, a sustainable project would imply an increasing level of private investment in the medina, particularly in the housing stock and in commercial and tourism activity. Over the long term, reaching a leverage ratio of three for each dollar of project funds would ensure this sustainability. The participatory approach adopted during project preparation should contribute to this goal; and (ii) the strengthening and effective participation of local entities, in particular ADER-Fs and the municipality of Fs- Medina. Both activities will be supported by the project, under the technical assistance component and an agreed-upon program of actions. -3-  Lessons Learned 9. Through an iterative process of analysis and consensus building, the project team, together with their Moroccan counterparts, defined a program of strategic actions that are most likely to overcome existing constraints to the process of rehabilitating the medina. Several grants, including one from the Japan Policy and Human Resources Development (PHRD) Fund, enabled a social assessment to be carried out, with the objective of establishing a forum for dialogue between residents and institutional stakeholders and identifying needs and concerns. Fs University and Harvard University (USA) also participated in these actions. It is a pioneering example of the use of social assessment and participation techniques to measure community preferences in regard to the rehabilitation of the historic built environment. and has informed project conservation priorities. 10. The project also demonstrates the importance of collecting data on the physical condition of the historic and social structures in targeting interventions to maximize benefit to the residents of the medina. This data made possible an alternative design for improving emergency access to the center of the medina which has reduced resettlement of residents down to 9 families. 11. Through a variety of institutional audits and assessment of training needs, the project has considered ways to strengthen local government's ability to improve selection of development priorities, deliver services, and manage resources. Administrative and operational efficiency will be addressed by introducing a computerized GIS database on the medina into local government administration, and strengthening by organizational structures for ADER and other related institutions. Environmental Assessment 12. The project has been rated a Category B project. Please see attached Annex. -4-  Contact Point: Mr. F. Amiot, Task Manager The World Bank 1818 H Street, NW Washington DC, 20433 Telephone: (202) 473-2372 Fax: (202) 522-1500 Note: This is information on an evolving project. Certain components may not necessarily be included in the final project. Processed by the Public Information Center week ending March 21, 1997 Environmental Annex The environmental category of the project was initially rated A, based on the UNDP prefeasibility proposal which should have led to the resettlement of more than 300 households. The new project design has minimized the resettlement to nine households, and includes positive actions to improve the environment of the medina. It is, therefore, proposed to rate the project under Category B. In spite of the extensive improvements to the medina's circulation system, particularly with the opening of an emergency network, the residential relocation load has been kept to a minimum by substituting demolitions of permanent structures by partial demolitions. As a result, the relocation load has been divided into two categories: permanent displacements due to the acquisition and demolition of a structure; and provisions for the temporary relocation of families, while partial demolitions and reconstruction of the affected structure is taking place. All structures affected by the project have been surveyed and a preliminary estimation of the modification works to be undertaken has been included in the project's cost. Interviews of households to be relocated or displaced temporarily have been undertaken in coordination with the local authorities, the Wali of Fs and the Governor of Fs-Medina. Data available on each household include: the number of members and relationship to the head of the household; employment information, including place of work; household income; location of educational establishment attended by school-age children. Nine households are to be relocated permanently. Five temporary relocation rental units have been set aside while modification works are undertaken in the 21 structures affected by the emergency network. No commercial relocation within the medina will be required as the polluting nature of the four displaced businesses requires their relocation in the new industrial zone of Ain Nokbi as part of a comprehensive policy affecting all polluting economic activities in the medina. The organization of the relocation process will be entrusted to a social unit within the prefecture. The unit will work in close cooperation with ADER-Fs and the municipality of Fs-Medina for - 5-  households living in Fs-Bali, and with the municipality of Mechouar for those living in Fs-Jdid. Its responsibilities will be to keep the concerned households informed of the process as it progresses; discuss their relocation options and assist them in making a timely choice; and assist them in organizing their move. Households requiring temporary relocation while structural work is being conducted will be given the option of moving into one of five apartments set aside for this purpose during the street improvement phase of the project, or receiving a monetary compensation equivalent to six months' rent should they prefer to move in temporarily with relatives or friends. A five-year follow-up study of displaced households is part of the project, and has been assigned to the social unit responsible for assistance to displaced households. The purpose of the study is to ascertain any variations in living standard resulting from temporary or permanent displacement in order to alleviate any drop in their standard of life. Families will be interviewed at six- month intervals, their situation assessed, and appropriate remedial measures taken as required by the social unit. - 6 -