Algeria - Housing Infrastructure Project

Report No. PIC484 Project Name Algeria-Housing Infrastructure Project Region Middle East North Africa Sector Urban Development Project Code DZPA4973 Implementing Agency Government of Algeria Ministry of Housing (Ministere de l'Habitat) 135, rue Didouche Mourad Algiers, Algeria Contact: Mr. Zakour Tel: 213.2.74.76.38 Fax: 213.2.74.75.43 Date this PID Prepared October 1993 Projected Appraisal Date July 1997 Projected Board Date December 1997 1. Project Objectives. Against Algeria's current background of political and economic uncertainty, improvement of the housing sector's performance is seen as one way to effectively alleviate social tensions and pave the way for broader long-term reforms. In this connection, the Government has embarked on an in-depth reform of the housing sector, including, inter alia, strengthening the land registration system with Bank assistance under the Cadastre project. The Government appears willing and able to establish a sound land market, launch private housing development, and rationalize the trade-offs between urban and agricultural land use. For this, the Government will have to build trunk infrastructure within urban limits and sell urban Government land to the highest private bidders. Appropriate urban regulations, cost recovery provisions, and land taxes should accompany this process. The proposed project concentrates on land management and development. The project objectives are to: a) improve land market operation and infrastructure cost recovery; and b) increase urban land supply. 2. Project Description. The project provides: (a) trunk infrastructure for urban expansion areas in the four major cities: Algiers, Oran, Constantine, and Annaba, areas in which Government land would be auctioned to private developers (759 of project cost) (b) construction material imports to meet the demand induced by the project (% of project cost); and (c) technical assistance to improve the land market operational environment and infrastructure cost recovery. 3. Project Cost and Financing. Project cost is estimated at $400 million. A Bank loan would finance the foreign exchange part of the first component (50 percent of its cost). The Government would finance the remaining 50 percent. Cofinancing is being sought for the second component. Technical assistance would be financed by the Bank loan. 4. Project Implementation. The project would be implemented over  5 years. The first component would be implemented in two steps: first, construction of trunk infrastructure and auctioning land tracts to developers, and second, development of these land tracts and reselling plots to households. The second component would be implemented by selected importers, who would buy foreign exchange at market rate and resell materials to established retailers. An inter-ministerial project unit would implement the third component and coordinate the whole project. 5. Environmental Aspects. Improving urban land management and limiting urban encroachment on rural land are at the heart of the project. The project is expected to have a positive environmental impact, and would support the environment cell created within the Ministry of Housing under a previous Bank project (Housing Completion and Sector Development Project). The project is rated category B. Contact Point: Public Information Center The World Bank 1818 H Street N.W. Washington D.C. 20433 Telephone No.: (202)458-5454 Fax No.: (202)522-1500 Note: This is information on an evolving project. Certain components may not necessarily be included in the final project. - 2 -