Central African Empire - Third Highway Project

Report No. 1246-CA FILE COPY Appraisal of a Third Highway Project Central African Empire August 21, 1978 Western Africa Projects Department Highways Division FOR OFFICIAL USE ONLY Document of the World Bank 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 Currency Unit = CFA franc (CFAF) US$1.00 = CFAF 245 CFAF 1 million = US$4,081 Fiscal Year January 1 - December 31 SYSTEM OF WEIGHTS AND MEASURES: Metric Metric British/US Equivalents I meter (m) = 3.28 feet (ft) 1 kilometer (km) 2 = 0.62 mile (mi) 1 square kilometer (km ) = 0.386 square mile (sq mi) I metric ton (m ton) = 2,204 pounds (lb) ABBREVIATIONS AND ACRONYMS ACCF - Agence Centrafricaine des Communications Fluviales AfDF - African Development Fund ATC - Agence Transcongolaise des Communications CFCO - Chemin de Fer Congo Ocean DGPW - Directorate General of Public Works EDF - European Development Fund FAC - Fonds d'Aide et de Cooperation FRG - Federal Republic of Germany GTC - Groupement des Transporteurs Centrafricain MT - Ministry of Transport ONAF - Office National d'Affretement PK - Pointe Kilometrique UNDP - United Nations Development Programme voc - vehicle operating costs vpd - vehicles per day  FOR OFFICIAL USE ONLY CENTRAL AFRICAN EMPIRE APPRAISAL OF A THIRD HIGHWAY PROJECT Table of Contents Page No. SUMMARY ..................................................................... i- i 1. INTRODUCTION .................................................. . 1 2. THE TRANSPORT SECTOR ...... ........................... . 2 A. Economic Setting ........................................... 2 B. The Transport System ................. .......................... 2 C. Transport Planning . ...a.. . .... ... ... .............. . . . . 5 3. HIGHWAYS oo..... ... o................... .................................... 7 A. The Network ................................................ 7 B. Characteristics and Growth of Road Traffic ................. 7 C. The Road Transport Industry ................................. 8 D. Administration ........................................................... 3 E. Planning and Financing .... . . . . . . . . ........... 9 F. Engineering and CoAistruction ..* ....... 11 G. Maintenance . ................................................ 11 4. THE PROJECT .. ................................................... 15 A. Description ................... . ............................ 15 B. Cost Estimates ................ ............................. 16 C. Execution .................................................. 18 D. Financing and Disbursements ................................ 19 5. ECONOMIC EVALUATION ............................................ 20 A. General .................................................... 20 B. Regional Development .......................................... 20 C. Traffic ......................................... 21 D. Economic Return ................................. 22 E. Sensitivity Analysis ....................................... 22 F. Distribution of Benefits ........ .................................. 23 6. AGREEMENTS REACHED AND RECOMMENDATION ................ .......... 23 This report has been prepared by Messrs. D. Jovanovic (economist), S. Hayden and G. Trnka (engineers) following an appraisal mission in March 1976, and two post-appraisal missions in April 1977 and April 1978. | 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.  TABLES 1. Composition of the Hfghway Network in 1976 2. Traffic Development in River Ports 1970 - 197-5 3. Investments in Transport Sector during 1971 - 1975 Plan 4. Draft Investment Program for the Transport Sector in the New Five- Year Plan 1976 - 1980 5. Vehicle Fleet Development 1971 - 1975 6. Highway Expenditures 1971 - 1975 7. Estimates of Government Revenue from Road Users 1973 - 1975 8. Design Standards for Reconstruction of Bangui-Bossembele Road 9. Estimated Schedule of Local Cost Financing 10. Estimated Schedule of Credit Disbursements 11. Estimates of Vehicle Operating Costs 12. Estimated Economic Returns of the Reconstruction of Bangui- Bossembele Road ANNEX 1. Economic Evaluation of Bangui-Bossembele Road Reconstruction CHART Organization of Department of Public Works MAPS IBRD 12228 IBRD 12229  C.A.E. APPRAISAL OF A THIRD HIGHWAY PROJECT SUMMARY i. The Central African Empire (C.A.E.) is a landlocked country about 1,700 km from the nearest ocean port (Douala). The flows of C.A.E.'s external trade are very sensitive to transport costs because of the long distances between production centers and ocean ports and the fact that the scarcity of known natural resources causes heavy dependence on imports. The country's main access to the sea is the Trans-Equatorial route (which is run by Agence Transcongolaise des Communications, ATC) to the port of Pointe Noire (Congo), a distance of about 1,810 km. However, a shorter route via Cameroon is grow- ing in importance, due partly to shortcomings of the route via Congo. The Douala port handles about 10% of C.A.E.'s external trade: it is estimated that in 1976 over 200,000 tons of C.A.E.'s export/import traffic used the ATC route, while about 20,000 tons were transported via Cameroon. The routes are competing and complementary at the same time. Assuming that the volume of C.A.E. export/import traffic will grow at about a modest 3% per annum, by 1985 approximately 65,000 tons or about 20% of total tonnage is expected to be transported via the Cameroon route; by 1995 its share could reach 40% of the total volume of the export/import traffic or 170,000 tons. Nevertheless, the ATC route is expected to keep more than 50% of C.A.E.'s external trade or over 200,000 tons per annum. ii. The internal transport infrastructure is generally adequate in extent for the country's level of development. In the draft 1976-1980 Five- Year Plan (draft plan) the Government gives high priority to improvement of the route to Cameroon (Bangui-Bossembele-Cameroon Border road), to construc- tion of about 30 bridges in different regions and to a maintenance program for secondary roads. On the Association's initiative, the Government and participating foreign donors prepared a four-year program for maintenance of primary roads. In addition, the draft plan calls for construction or im- provement of about 1,300 km of trunk roads. The draft plan appears ambitious, and it is uncertain how the entire program will be financed. In the period 1971-1974, capital investments in the transport sector amounted to about CFAF 7.9 billion (US$32.0 million), or about 28% of total capital expenditure in the country. iii. Bank Group lending in the transport sector has totalled about US$8.5 million to help finance two highway projects, one in 1969 for about 100 km of road construction, and the second in 1970 for a 4-year road main- tenance program. The construction works of the First Highway Project were satisfactorily completed. The Second Highway Project, however, was not successful; its execution was hampered mainly by the Government's continuous lack of funds for recurrent maintenance expenditure.  - ii - iv. The main objective of the proposed Third Highway Project is to improve a major trunk road, Bangui-Boali-Bossembele (145 km), which also serves as the first section of C.A.E.'s access route to the ocean via Cameroon. Landlocked C.A.E. cannot rely exclusively on the Trans-Equatorial route which is useable only about eight months per year and which does not provide satis- factory services for transit traffic. Construction of the Bangui-Bossembele- Cameroon Border road would provide year-round access to an ocean port and reduce transit time. For these reasons and the significant local traffic it carries, the road is given high priority in the draft plan. The proposed project consists of the reconstruction of the Bangui-Bossembele road to two-lane bituminous sealed standard. v. The Association made the financing of this project contingent upon the Government's arrangement for a minimum road maintenance program supported by foreign assistance. The aim is to initiate necessary maintenance on limited networks and to have the Government gradually increase its effort. vi. The cost of the project is estimated at US$25.7 million equivalent net of identifiable taxes and duties; foreign costs amount to US$22.4 million (87%) and the local cost component is US$3.3 million equivalent (13%). The Government has exempted the project from taxes and duties which would amount to an additional US$3.6 million equivalent. The proposed Credit of US$15.5 million would finance 60% of the cost. The Government has committed itself to finance part of the local component of project costs. However, in view of its tight fiscal situation it was agreed that co-financing from external sources is needed in order to cover almost the entire net-of-tax cost. The African Development Fund will finance US$5.6 million and the Kuwait Fund US$3.6 mil- lion. The Government will provide US$1.0 million. vii. The Directorate General of Public Works (DGPW) will be responsible for execution of the project, with the assistance of consultants for com- pletion of preparatory work. FAC experts already assigned to DGPW will supervise construction. viii. Detailed engineering was completed in October 1975 and some addi- tional work on the designs and the bidding documents were completed in October 1977. DGPW employed consultant Louis Berger (USA) to carry out this work together with the prequalification of contractors and evaluation of bids. The reconstruction works will be done by unit price contracts, the award of which will follow international competitive bidding (ICB) in accord- ance with Bank Group guidelines. To enable participation of local contract- ing firms in bidding for bridgeworks, the project works have been split into two contracts i.e. roadworks for the entire road and bridgeworks for the new structure at M'Bali River. Ten foreign firms have been prequalified for both contracts and one local firm for the bridgeworks contract only. Separate bids for each contract or a combined bid for both contracts were invited in November 1977. ix. Costs for civil works are based on the detailed engineering studies and were finalized after the results of bid opening were received in April 1978. There was no ICB in the country for four years; therefore to ensure the  - iii - most realistic estimate of total project costs, the Government proceeded with ICB prior to submitting the project to the Association's Board of Executive Directors for approval of the Credit. Of the 11 firms prequalified, 4 con- tractors submitted their bids for roadworks and 3 contractors tendered for bridgeworks. After having evaluated the bids, the Government proposes to award the contracts to the lowest evaluated bidders. Contracts for the construction works are expected to be awarded in September 1978, and to take about two and a half years to complete. x. Credit proceeds would be disbursed on the basis of 60% of total expenditures for construction costs net of taxes and duties. The Govern- ment has requested the Association to consider retroactive financing up to a limit of US$140,000 for consultants' fees for finalization of detailed engineering designs, prequalification of contractors and evaluation of bids. Disbursement would be on the basis that the proposed IDA Credit of US$15.5 million would finance the following: (i) for reconstruction of Bangui- Bossembele road, 60% of the total cost of items net of taxes and duties; (ii) for supervision of construction, 100% of the foreign cost and 55% of the total cost of laboratory services; and (iii) for consulting engineering services, 100% of foreign cost. xi. The economic return for paving the road was estimated on the basis of benefits from vehicle operating cost savings to normal and generated traffic, maintenance cost and distance savings. The economic return for paving Bangui-Bossembele road (145 km) is 12%; the return for paving the first section is about 13% and for the second section about 11%, with a first year return of 10% and 8% respectively. Under sensitivity tests, the rate of return on the whole road still remains 10% when the cost is increased by 10% and benefits decreased by 10%. xii. The bulk of project benefits is related to savings in agricultural freight transport and long distance transport to and from Bangui, basically measured in normal traffic, and generated traffic benefits. In addition, the reconstruction of the road will produce time savings, and reduce accidents and road maintenance costs. Finally, it is anticipated that the economy as a whole will benefit from the project by improvement of C.A.E.'s part of its export/import outlet via Cameroon. xiii. Agreement having been reached on the issues set forth in Chapter 6 of this report, the proposed project is suitable for a Credit of US$15.5 million to the Government of Central African Empire on standard IDA terms.   C.A.E. APPRAISAL OF THIRD HIGHWAY PROJECT 1. INTRODUCTION 1.01 Central African Empire has a basic transport infrastructure gen- erally adequate in extent to match the country's level of development. Over recent years, the Government's development strategy has been to upgrade major trunk roads (mostly in the south) where the Bangui-Bossembele-Bouar-Cameroon Border road has been given particular attention. For the landlocked C.A.E. the reconstruction of the road will improve a long desired and needed alter- native to the Trans-Equatorial route for access to the ocean. 1.02 The proposed project would be the third financed by the Association in the transport sector of C.A.E. The First Highway Project (Credit 146-CA, US$4.2 million, 1969), financed the paving of Bangui-M'Baiki road (98 km) which was satisfactorily completed in 1972. The Second Highway Project (Credit 199-CA, US$4.3 million, 1970) consisted of a four-year highway main- tenance program, including procurement of equipment, spare parts, materials and technical assistance for project management and training. Due to Govern- ment's financial inability to meet necessary recurrent road maintenance costs, use of road maintenance equipment for other than project works, and unsatisfactory training results, the program's scope was significantly re- duced. The project was unsuccessful and was finished in early 1975. 1.03 Preparation of the proposed project began in 1970 under the Second Highway Project which also provided financing for the feasiblity study and detailed engineering for the Bangui-Bossembele road. The study was prepared in June 1972, but the execution of detailed engineering was deferred due to low traffic at that time. Detailed engineering was finally completed in October 1975, and an updated economic analysis was completed in February 1976. 1.04 The project cost is estimated at US$25.7 million equivalent net of identifiable taxes and duties; foreign costs amount to US$22.4 million (87%) and local costs amount to US$3.3 million equivalent (13%). The proposed Credit of US$15.5 million would finance 60% of the cost. The Government has exempted the project from taxes and duties, which would total US$3.6 million equivalent. 1.05 This report is based on studies carried out by the DGPW consultants, Louis Berger (USA), and on the findings of an appraisal mission, consisting of Messrs. D. Jovanovic (economist), S. Hayden and G. Trnka (engineers), which visited C.A.E. in March 1976, and post-appraisal missions in April 1977 and April 1978.  - 2 - 2. THE TRANSPORT SECTOR A. Economic Setting 2.01 The Central African Empire with an area of about 620,000 km is located in Equatorial Africa. A landlocked country, the C.A.E. is faced with high transport costs to reach remote trade outlets. Most of the country lies on a high rolling plateau which presents no particular geographical obstacles to transport, but long distances put a strain on the transport system. The sparse population, growing at about 2.2% annually, is estimated at about 2.0 million in 1978. It is concentrated mostly in the south and west of the country, where the areas of economic activity are located. 2.02 In recent years the Gross National Product (GNP) has been stagnat- ing in real terms; GNP per capita was estimated at about US$230 in 1976. Natural resources include agriculture and livestock potentials in the south and west, substantial forest reserves in the southwest and some minerals, diamonds (near Berberati) and uranium deposits (near Bakouma). About 80% of the population is engaged in agriculture and forestry, together account- ing for about 40% of GNP. Principal exports from 1973 to 1976 were timber products (30%) and diamonds (23%) followed by coffee (22%) and cotton (16%). This represents a major shift in the composition of exports in 1970 when diamonds accounted for 41% of export value, cotton and coffee 22% each, and timber 6%. While the increase in the value of coffee exports was caused by world market, diamond production has fallen, the cotton sector has stagnated and the timber industry underwent a swift expansion which was halted in 1975 and 1976 because of decreased demand in Europe. Despite an average increase of about 8% in export tax revenues from 1970 to 1975, overall budgetary deficits continue (US$11.4 million in 1975 as compared to US$16.0 million in 1976) mainly due to increased import prices and inadequate fiscal and budgetary management. B. The Transport System 2.03 The domestic transport system is simple and relies mainly on road transport. The present road network consists of about 11,000 km of classi- fied primary and secondary roads of generally low standards (only about 300 km are paved) and about 11,000 km of unclassified feeder roads and tracks (Table 1). Major trunk roads radiate from Bangui, C.A.E.'s capital. The main internal transport axis is C.A.E.'s part of Trans-African Highway (Cameroon Border-Bossembele-Bangui-Sibut-Zaire Border, about 1,300 km) connecting the country from east to west (see Maps). Details of the road system and of the characteristics of road transport are given in Chapter 3. Access to the Ocean 2.04 The flows of C.A.E.'s external trade are sensitive not only to the high transport costs caused by long distances to the nearest ocean ports (CFAF 19,000-34,000/ton or CFAF 11-20 per t/km), but also to inefficient services provided on existing routes. External transport is therefore an  - 3 - important factor to the economy, since the high transport costs make the country's exports less competitive as well as inflate the domestic prices of imports. The country's primary access to the sea is via the Trans-Equatorial route (para. 2.05) running from N'Djamena (Chad) south to the port of Pointe Noire (Congo). To reach Pointe Noire from Bangui, goods must travel a river/ rail route of approximately 1,810 km: 1,300 km by the Oubangui and Congo rivers to Brazzaville and then 510 km by rail from Brazzaville to Pointe Noire. The alternative route via Cameroon is shorter with a total distance of about 1,680 km (Bangui-Douala). It goes from Bangui to N'Gaoundal by all-weather road (about 850 km) and thence by railway (830 km) to the port of Douala which offers significant savings in maritime freight; via n'Gaoundere the route is 1,815 km. 2.05 The Trans-Equatorial route handles most of C.A.E.'s external trade traffic, but its share has been gradually declining in recent years. Pre- sently, the Trans-Equatorial route carries about 90% of C.A.E.'s external trade, while the Cameroon route carries the rest. In 1976 it is estimated that about 200,000 tons of C.A.E. export/import traffic used the ATC route, while over 20,000 tons were transported via Cameroon. The routes are com- peting and complementary at the same time. The less expensive river link of the ATC route makes it attractive for the transport of bulk commodities, namely timber, fuel, cement and cotton. The Cameroon route is attractive for higher value commodities and small shipments, such as textiles, vehicles, foodstuffs, beverages, leather, paper, coffee, tobacco, etc. Assuming that the volume of C.A.E.'s export/import traffic will grow at about a modest 3% per annum, by 1985 about 65,000 tons or 20% of total tonnage is expected to be transported via the Cameroon route; by 1995 its share could reach 40% of the total volume of export/import traffic or 170,000 tons. Nevertheless, the ATC route is expected to keep more than 50% of C.A.E.'s external trade or over 200,000 tons per annum. However, in the case of slower growth (less than 3% annually) of the external trade volume, the ATC share of the traffic is expected to be more affected. 2.06 Agence Transcongolaise des Communications (ATC), formed in 1969, is the successor to a multi-national agency, the Agence Transequatoriale des Communications (ATEC), created in 1958 by the Congo, Gabon, C.A.E. and Chad to manage the 2,900 km route from N'Djamena (Chad), through Bangui to Pointe Noire. Now a Congo national agency, ATC still performs many func- tions of the former ATEC by virtue of agreements among the countries concerned. ATC owns and operates an integrated system comprising: (a) the Atlantic Ocean port of Pointe Noire; (b) a railway, Chemin de Fer Congo Ocean (CFCO), from Pointe Noire to Brazzaville; and (c) river ports (including Brazzaville) and river services on the Congo-Oubangui-Sangha rivers. There are several diffi- culties in C.A.E.'s relying exclusively on this corridor. It is not useable all year round since the Oubangui river is navigable only about eight months during the year. Furthermore, since 1972 the ATC system has had difficulties in handling the traffic. The principal bottleneck in the system has been the railway. ATC's services have deteriorated, causing particularly long delays  - 4 - for transit traffic of C.A.E. It is expected, however, that the operation of the ATC system will improve. 1/ 2.07 The Cameroon route, useable all year round, has constraints which prevent C.A.E.'s using it to a greater extent. The road section in C.A.E. (595 km) and a few bridges along the road need improvement or reconstruc- tion which is given the highest priority in the draft Five-Year Plan (para. 3.11). The Government is seeking external financing for road sections after Bossembele, and it can be reasonably assumed that this portion of the route will be improved by 1984/85. In Cameroon, the road section via N'Gaoundal is also part of the Trans-African Highway and 140 km (out of about 250 km) have just been paved. The problem lies in the Douala-Yaounde corridor and in the congested port of Douala. The situation will be improved by exten- sions and reorganization of the port and with the planned construction of a new marshalling yard. 2/ River Transport 2.08 River transport, particularly important for export/import traffic, follows the Oubangui, Lobaye and Sangha rivers, totalling about 2,000 km. Agence Centrafricaine des Communications Fluviales (ACCF), a state enter- prise with financial and administrative autonomy under the authority of the Ministry of Transport, was created in 1970. ACCF is responsible for freight and passenger transport on C.A.E.'s waterways and partly on the ATC route to Brazzaville. In 1976 total tonnage transported by ACCF was about 245,000 tons. Due to its poor management and organization, shortage of qualified local staff and to declining traffic partly due to the economic situation in the C.A.E., ACCF's financial position has been deteriorating. By 1976 its total debt was about CFAF 1.5 billion, of which over CFAF 700 million was owed to ATC (Congo). A study of the ACCF, financed by Fonds d'Aide et de Cooperation (FAC), was completed in September 1975. It calls for the general reorganization of and improvement in management, an increase in the technical assistance team from 12 to 19 experts and an increase in the fleet. Efforts 1/ ATC has been trying to improve the various components of its system and its current investment plan (1974-1978) calls for improvements amounting to US$234 million to be financed mainly by international and bilateral sources. The Bank Group has already contributed two credits of US$16.2 million (in 1972 and 1973, Cr. 297-COB) and a US$38.0 million loan (1976, Loan 1228-COB). 2/ The total cost of the Douala port extension and modernization project is estimated at about US$120 million equivalent. In August 1976 the Bank Group approved a loan of US$15 million and IDA credit of US$10 million. The balance would be provided by other international and bilateral insti- tutions and by the Government of Cameroon. The project is expected to meet the port of Douala's needs through 1985. The growing traffic con- gestion between Douala-Yaounde led to a study of alternative investment policies for road and rail in this corridor. The Bank Group made two loans to Cameroon railways totalling US$21.2 million; the last one (Loan 1038-CM) included the Douala-Yaounde transport corridor study which is underway.  - 5 - have also been made to increase ACCF operational capacity. The European Development Fund (EDF), FAC and bilateral aid from the Federal Republic of Germany (FRG) financed a project under which a tugboat and four tankers were purchased. The project was completed in 1976. 2.09 The ports of C.A.E. are managed by ACCF. Both their operational efficiency and maintenance of their facilities need improvement. The port of Bangui with a capacity of about 300,000 tons per year is the largest by far. The traffic in the port declined 10% annually in the period 1970-1975 (Table 2), falling to 166,000 tons, of which approximately 30,000 tons was Chad transit traffic. The port of Zinga, also on Oubangui River, is small and used when vessels cannot reach Bangui because of low water level. Salo on the Sangha River is not a real port and handles timber exports only (about 60,000 tons/year). The FAC-financed study recommended creation of a separate management to operate Bangui port more efficiently and to take better care of existing port facilities. Air Transport 2.10 C.A.E. has an international airport at Bangui which handles about 95% of the country's total air traffic. The air traffic is low and stag- nating; in 1973 the airport had a traffic volume of 6,800 tons and 24,000 passengers. The rest of the air traffic is spread over about 12 scattered secondary airfields. Twelve expatriates assist C.A.E. in civil aviation; additional qualified local staff is needed. The country has two airlines: (i) Air Centrafricaine, Government-owned, with two old planes - one DC 3 and one Beach Baron; the company operates at a loss which is covered by the general budget; (ii) ACAV (Agence Centraficaine de Voyage) is a private enterprise of mixed capital with two Caravelles and specializes in unsched- uled international flights. C. Transport Planning 2.11 Development plans in the transport sector are initiated by the Ministry of Transport, and those specifically for roads by the Ministry of Public Works, in the form of investment proposals. On the basis of these preliminary proposals, the Ministry of Planning puts together a draft plan which is submitted to the Council of Ministers for further review and finally to the Emperor. For most investments, however, this institutional arrangement is overshadowed by imperial decision-making, to the extent that the above process can be reversed with investment proposals originating from the emperor. Having the power centralized to such a degree creates institutional weakness in the established planning process. 2.12 The Ministry of Transport (MT), formally responsible for transport policy and coordination, needs qualified staff to strengthen policy making and investment planning. The planning is actually reduced to investigations on a project-by-project basis. At the request of MT, UNDP is considering financing a transport planning specialist, who would only alleviate the staffing problem in the Ministry. However, several nationals are at schools abroad, and the Ministry expects them to be available in a few years.  2.13 During 1971-1975 (within the previous five-year plan) total invest- ments in the economy as a whole amounted to about CFAF 39.0 billion, of which capital investment in the transport sector amounted to about CFAF 7.9 billion (US$32.0 million) or about 20% of total capital expenditures. The development of the transport infrastructure has been slow, with emphasis on improving the trunk road network and the facilities of ACCF. About 70% of the total invest- ment in the sector was devoted to highways, 25% to river transport and 5% to air transport (Table 3). 2.14 Although the transport sector's share appears adequate, in absolute terms investments in the sector were insufficient considering its importance and requirements. The country's increasing reliance on imports and exports can be expected to increase the sensitivity of its landlocked economy to changes in quality and cost of transport services both within the country and on external access routes to the sea. It appears that the Government has realized that, and in the draft plan (Table 4) the proposed program for the transport sector calls for an enormous increase in investments amounting to about CFAF 65.0 billion (US$265 million) or 43% of total planned investments in 1976-1980 mostly for the highway sector (paras. 3.11-3.12). The financing of the program relies almost entirely on external sources, and the program appears too ambitious. Although the Government recognizes the importance of road maintenance, little has been achieved in the field. Preliminary agree- ment on a maintenance program was reached at a meeting held in Bangui in April 1977 between the Government and foreign donors (EDF, FAC, FRG and World Bank) (para. 3.22). Due to this new development, the sector targets originally set in the plan will need to be revised, since expected external resources will be partly shifted to road maintenance. 2.15 Coordination of the various transport modes is not a problem in the C.A.E., since road transport is the dominant mode and does not actually compete with river transport. However, the organization of air transport and particularly of river transport and ACCF need improvement and require action by the Government. Following the recommendations of the FAC-financed study, the Government agreed that, with the assistance of external donors, it would prepare a program to rehabilitate river transport and ACCF opera- tions. The program is expected to be completed in 1978 and will be submitted to the Association for comment. The program is expected to concentrate on improving management (possibly providing additional technical assistance)and on improving maintenance and utilization of ACCF and Bangui port facilities. Highway Sector Lending 2.16 The current situation in the C.A.E. does not permit the sector lend- ing approach for transport. The sector's capabilities are too limited due to basic shortcomings such as a lack of qualified staff with managerial cap- ability, as demonstrated in the execution of the previous road maintenance program, and a severe shortage of local funds for all economic sectors. Therefore, a project-by-project approach will remain the appropriate form of lending for the C.A.E. in the foreseeable future.  3. HIGHWAYS A. The Network 3.01 There are about 11,000 km of classified primary and secondary roads of which only about 300 km are paved (Table 1). The remainder are gravel or earth roads of generally low design standards, and some of these are periodi- cally closed during the rainy season. There are also about 11,000 km of unclassified feeder roads and tracks connecting areas of agricultural activity. The Directorate General of Public Works (DGPW) in the Ministry of Public Works is responsible for the entire network of about 22,000 km (para. 3.07). 3.02 The C.A.E.'s road network is generally adequate in extent and serves all populated areas in the country. Primary roads have been inadequately maintained (para. 3.18), while secondary and feeder roads have deteriorated due to the complete lack of maintenance over the past several years. Further- more, about 30 bridges on the trunk road network are damaged or unuseable and require urgent reconstruction which is partly underway (para. 3.11). The terrain in the country, with some exceptions in the north, is generally easy, and natural road construction materials are available. B. Characteristics and Growth of Road Traffic 3.03 Traffic density patterns follow the location of economic activity in the south and southwest. Transport demand is seasonal because of the pre- dominance of agriculture. Collection of traffic data is the responsibility of the DGPW, but traffic counts so far have been carried out only for selected roads whose reconstruction is planned by the Government in the draft plan. A counting system to cover the entire primary road network has not yet been established. Based on export/import and transit traffic volumes and on estimates of internal production, the total tonnage transported in the C.A.E. is estimated now at about 350,000 tons per annum. 3.04 The available data on the motor vehicle fleet indicate an annual rate of increase of 8% in the period 1971-1975 (Table 5). In 1975 the fleet consisted of about 14,700 units of which about 80% were light vehicles. Although the fleet might have been overestimated due to inadequate data collecting (vehicles no longer in use might have been kept in), the existing truck fleet was more than adequate to serve past requirements. However, the trend towards increasing use of the Cameroon route will require some change in fleet structure and further increase in trailers' capacity, which grew at 18% per year in this period. Lack of data (such as fuel consumption) prevents a more accurate estimate of average traffic growth on the network. The estimate made by consultants in 1969 of 8% per year now appears high and does not follow the recent performance of C.A.E.'s economy. It is more reasonable to assume that average annual traffic growth is currently in the vicinity of 5%.  - 8- C. The Road Transport Industry 3.05 Public freight transport is handled by the Office National d'Affretement (ONAF), a state-owned company with administrative and financial autonomy, and by numerous private transporters. ONAF was created in 1969 and is under the authority of the Ministry of Transport (MT). Its fleet is steadily growing and in 1976 reached 180 trucks and trailers with total payload capacity of 2,200 tons. ONAF has somewhat improved its management and eliminated its past deficit. It has a privileged position and controls most road freight transport except cotton and timber. Over 30% of total road freight traffic (other than cotton and timber) is carried directly by ONAF. Urban and interurban passenger transport is handled by the Compagnie Nationale de Transport Routier (CNTR), a state-owned company under the authority of MT, and by about 50 individual transporters. 3.06 The majority of public freight transport is handled by more than 50 private transporters, who are required to obtain licenses from the MT (valid one year). MT also provides authorization for the purchase of commercial vehicles. Private transporters are organized in the Groupement des Transpor- teurs Centrafricain (GTC), a private organization which represents its members in dealing with Government organizations (including ONAF). The trucking in- dustry is divided between ONAF and GTC. Public transporters are required to obtain authorization from ONAF for each freight transport; this is routinely provided. For its organizational role in transport distribution and services, ONAF charges GTC 7% of its total net annual revenue. Although the justifica- tion of this arrangement could be questioned, the situation in the freight transport industry appears fairly reasonable since ONAF is trying to achieve more efficient allocation of freight transport. In order to pursue this policy, ONAF is planning to open offices in the interior. Further analysis, however, of the organization of the industry is needed. The present tariffs, which were set in 1975, are within the tariff range in the African Region (CFAF 14-24 per ton/km). The tariff for general merchandise is CFAF 18 per ton/km, while for special commodities (fuel, cotton, foodstuffs) the tariff is lower, ranging from CFAF 13-15 per ton/km. D. Administration 3.07 DGPW is responsible for the administration, design, construction and maintenance of the primary road system, government buildings and river works. DGPW's jurisdiction was extended in October 1975 when it took over about 17,000 km of the secondary and feeder roads and tracks from Genie Rural and was made responsible for their maintenance. DGPW consists of three directorates and a laboratory (see chart). The Directorate of Planning and Construction has three divisions which are responsible for studies and planning, supervision of new road construction, and building works. The Directorate of Road and River Maintenance is in charge of maintenance operations and the management of DGPW's equipment pool. This directorate has four divisions, two of which constitute its field organization covering two regional districts, each divided into four sub-divisions. The other two divisions are in charge of  - 9 - equipment and workshops, and of river works. The Directorate of Administra- tive and Financial Services is responsible for overall administrative and financial matters and staff training. The DGPW laboratory carries out soil surveys and soil and materials tests for highway design and construction. 3.08 All three divisions of the Directorate of Planning and Construction are staffed exclusively by French technical experts. Twenty-two engineers and technicians, who are provided under a long-standing FAC technical assis- tance program, operate this directorate efficiently. The Directorate of Road and River Maintenance is inadequately staffed by local technical per- sonnel, consisting of one engineer and about a dozen technicians. Adequately maintaining the entire road network, for which the DGPW is responsible, is beyond the directorate's present capability. The Directorate of Administrative and Financial Services is also staffed by local personnel with the exception of the EDF-financed training school which employs three expatriate training officers. The DGPW laboratory is staffed by two French expatriates, one local engineer and two local technicians; it has the technical competence to perform its duties, but its facilities and equipment are obsolete and incomplete. 3.09 Except for the Planning and Construction Directorate, the DGPW's staffing situation is unsatisfactory, especially in the Road and River Main- tenance Directorate where a serious shortage of specialized staff exists. Most of the managerial and technical competence depends on the FAC technical assistance program, and the continuation of this assistance, particularly for the Planning and Construction Directorate, is crucial to the DGPW's overall operation. French authorities have indicated, in discussions, that this assistance will continue. 3.10 In DGPW, there is a program to provide civil engineering training to nationals at different levels. About 10 Central Africans are studying engineering in Europe, and an equal number of higher grade technicians are receiving advanced training in Europe, Ivory Coast and Senegal. There are about 80 students training as lower grade technicians in Chad and Mali. In addition, an EDF-financed training school was established in Bangui in 1974 with an output of about 40 civil works inspectors, foremen and mechanics in each two-year cycle. EDF support will continue until 1980. Although the training efforts seem to be well organized, it is unlikely that they will result in any significant additions to DGPW's staff. E. Planning and Financing 3.11 The draft plan for the highway sector (Table 4) includes upgrading major primary roads, reconstruction of about 30 bridges scattered in different regions and a maintenance program for secondary and feeder roads. The highest priority is given to the construction of Bangui-Bossembele-Cameroon Border road (595 km). The draft plan also includes construction of M'Baiki-Mongoumba road (115 km), as well as improvement of C.A.E.'s section of the Trans-African Highway (pavement strengthening of Bangui-Damara 68 km and construction of Sibut-Bambari-Bangassou road 553 km). In addition the draft plan also envis- ages the construction or improvement of about 600 km of other trunk roads. However, implementation of the plan is proceeding slowly; at present only six  - 10 - of the 30 bridges are being reconstructed under the first phase of an EDF program. In the second phase, EDF would continue with the bridge projects and would finance pavement strengthening of the Bangui-Damara road. On the Association's request, a four-year maintenance program of the primary road network, to be financed by foreign aid, has also been included (paras. 3.22-3.27). 3.12 The draft plan, calling for construction or improvement of more than 1,900 km of roads in 5 years, is unrealistic, and it seems unlikely that financing for the entire program will be obtained. Since the transport demand in C.A.E. is, with some exceptions, generally low, major investments in road construction are not economically justified. A more realistic approach would be to limit construction plans to the high priority road to Cameroon, the projects under the above EDF program (para. 3.11) and the maintenance program to preserve the primary network from further deterioration (paras. 3.22-3.27). 3.13 Highway expenditures are financed from two sources: the national budget and foreign aid (principally from EDF, FAC and the Bank Group). Current and capital road expenditures in 1971-1975 totalled about CFAF 9.4 billion (US$38.5 million equivalent) of which CFAF 5.5 billion (US$22.4 million) or about 60% was spent on investment and the rest on road mainte- nance (Table 6). 3.14 Road users contribute to the national budget through taxes levied on fuel (CFAF 32/litre on gasoline, CFAF 13/litre on diesel oil), taxes and duties on imported vehicles and spare parts, and taxes for vehicle registra- tion, licensing and inspection, and road tolls. Total revenues from all road user sources over the period 1973-1975 amounted to about CFAF 3.6 bil- lion (US$14.7 million equivalent) (Table 7). Government expenditures for the highway sector over the same period were much less, totalling about CFAF 1.2 billion (US$4.9 million). 3.15 The most important source of revenue from road users is the taxes levied on fuel, which amounted to more than CFAF 700 million in 1975. Ac- cording to the covenants (Sections 4.03 and 4.04) in the Development Credit Agreement of the Second Highway Project (Credit 199-CA), as much revenue as needed for adequate maintenance should be allocated annually from fuel taxes to the Road Fund, which was established in 1971. If these revenues are not sufficient to provide necessary maintenance funds, the Government should increase budgetary allocations to the Road Fund by means of fuel tax increases or other measures. In practice, however, the funds allocated annually for road maintenance are only about half the revenue from fuel taxes (Tables 6 and 7) and consequently maintenance is neglected. The Government acknowledges the inadequacy of the maintenance budget and funding, and after a recent review of the matter, confirmed that it would allocate CFAF 500 million in 1977, and at least the same amount annually thereafter, to a special account in a local bank. This Road Fund account will be operated by the Ministry of Public Works and the funds will be used exclusively for maintenance operations.  - 11 - F. Engineering and Construction 3.16 DGPW's Planning and Construction Directorate prepares designs for minor road improvement works and simple bridge structures; design for major projects is done by foreign consultants. At present, C.A.E. has not estab- lished its own set of highway design standards, and French practices and design techniques are widely used. The Directorate of Planning and Construc- tion has prepared bridge loading regulations, vehicle regulations, some typical construction specifications and conditions of contract, all based on French practice. 3.17 The domestic construction industry is small and at an early stage of development. In building construction, there are several local contrac- tors who can compete with foreign firms. Two or three local contracting firms have experience in constructing minor bridges. There are no local contractors specializing in roadworks or capable of undertaking a sizeable road contract; all major road construction work to date has been done by foreign contractors. All road projects except for the Bangui-M'Baiki road (IDA Credit 146-CA) have been done under the auspices of EDF or FAC. As a result, only contractors of the EEC countries have been employed. G. Maintenance 3.18 Maintenance of the primary and secondary highways is handled by the Directorate of Road and River Maintenance through two regional divisions and eight subdivisions. Each subdivision is responsible for routine maintenance operations which are carried out by its own field staff of "cantonniers" and some equipment. In addition, there are two heavy equipment units engaged in maintenance and rehabilitation works. DGPW is in charge of one unit, which is assigned to Garoua Boulai on the road to the Cameroon border. Since most of DGPW's equipment provided under the IDA Second Highway Project is not operational and requires rehabilitation, the unit, engaged in road regravel- ling works, has been strengthened by a new fleet of 15 trucks recently procured by the Government on a supplier's credit. However, the unit is experiencing operational difficulties, including a continuous shortage of recurrent funds for fuel and lubricants, and lack of spare parts and of trained personnel. The second heavy equipment unit, established by FAC in 1975 to assist DGPW in carrying out road rehabilitation works, is engaged in regravelling primary roads in the forestry region of Berberati in the western district. It is equipped with US$1.5 million worth of equipment, and its operations are fully financed and supervised by FAC. The unit operates suc- cessfully but DGPW has little say in its management and no attempt is being made to develop a C.A.E. team to eventually take over the operation. 3.19 The four-year maintenance program (IDA Credit 199-CA) provided equipment and technical assistance. Continuous lack of Government funds for purchase of fuel, lubricants and spares slowed the works and made it necessary to reduce the scope of operations several times during the project period. Although the project achieved very little in physical terms and in training of personnel, it made the Government aware of the importance of regular main- tenance works. In DGPW there is no doubt about the necessity of an adequate country-wide maintenance program, but Government budgetary constraints prevent its implementation. On the Association's request, the Government recently  - 12 - reviewed the matter and committed itself to execute a four-year maintenance program on selected primary roads (paras. 3.22-3.27) in cooperation with foreign donors. 3.20 Highway maintenance is a chronic problem in C.A.E. Most roads have developed from tracks and have sub-standard formation and inadequate drainage, making maintenance difficult. In 1975 some 17,000 km of secondary and feeder roads and tracks were added to DGPW's maintenance responsibility but without corresponding budgetary support. Existing equipment, most of which is either obsolete or non-operational because of the lack of spare parts, was insufficient for the work. In 1977 the Government procured new maintenance equipment (US$650,000) and a fleet of 50 tippers and 10 tankers (US$4.5 million) on supplier's credits; the equipment is being delivered. However, the tippers and the tankers are huge, and their suitability for DGPW maintenance opeations is still to be proved. In general, the lack of trained supervisors, operators and mechanics is clearly evident in the organization and quality of the maintenance work carried out by DGPW. Although budgetary constraints are severe, the Government has established a clear policy on maintenance of primary roads by approving and participating in the foreign- assisted four-year maintenance program. 3.21 Expenditures for routine maintenance and administration are provided by the national budget, while a limited amount for heavy maintenance is pro- vided by FAC. The amounts allocated to the Ministry of Public Works for highway maintenance represent about 2.5% of Government's total current ex- penditures. This is comparable with most of the countries in the West Africa Region (average allocation is 2-3%), but the amounts actually made available (always less than budgeted) and spent on highway maintenance have been insuf- ficient to meet the requirements (Table 6). 3.22 In view of the inadequate road maintenance, the Association advised the Government in May 1976 that the financing of the proposed project was contingent upon the Government's arranging for the establishment of a minimum road maintenance program supported by foreign financial and technical assis- tance. The Government accepted the Association's condition and requested assistance from potential foreign donors. After lengthy preparatory discus- sions, the Government invited the potential donors, namely EDF, FAC and FRG, to meet in Bangui in April 1977. At the meeting, the Government confirmed that it assigned the highest priority to the Bangui-Bossembele road project and assured the foreign donors of its willingness to start and actively par- ticipate in a highway maintenance program. The Government reached preliminary agreement with EDF, FAC and FRG on the arrangements for the program (paras. 3.23-3.29), which were satisfactory to the Association. Later, in April and May 1978, Government signed agreements with EDF and FAC on specific programs, stipulating the scope of the programs; the Government's signing an agreement with FRG will be a condition of effectiveness of the proposed Credit. 3.23 The assistance for highway maintenance is expected to start in the fall of 1978. It would mobilize the Government's idle maintenance organiza- tion to execute routine maintenance operations on the priority road network (including the IDA-financed Bangui-M'Baiki road) using its field staff of "cantonniers" and existing equipment. To make DGFW's maintenance organization  - 13 - productive, the Government allocated CFAF 500 million (US$2.0 million) in 1978 and will allocate at least the same amount annually for the next three years to a special Road Fund account in a local bank. This account is managed by the Ministry of Public Works and the funds are used exclusively for mainte- nance operations, namely wages of "cantonniers", fuel and lubricants, spare parts, and materials. The Government intends to rehabilitate some existing maintenance equipment and to use funds from the 1978 budget to purchase spare parts. Using the rehabilitated equipment, the Government intends to launch maintenance operations in parallel with the program of foreign donors (para. 3.24). Also, the Government signed a contract with consultants Louis Berger (USA) to execute a highway maintenance study which started in November, 1977; the final report should be available in late 1978. 3.24 External donor agencies will assist the Government by providing and operating independently: (a) one rehabilitation and one light equipment unit (provided by FAC and FRG), and (b) one heavy equipment unit (provided by EDF). The units will carry out periodic maintenance, i.e. regravelling and rod reshaping works, on the Bossembele-Garoua Boulai section of the most important route from Bangui to Cameroon and on other selected high priority primary roads. The present FAC unit will also be engaged in maintenance works after completion of its current rehabilitation project by 1979. Although such a program will cover only 640 km of the primary road network (para. 3.27), its objectives would be the initiation of proper maintenance operations in the country and gradually increased efforts by the Government. 3.25 In addition to providing one heavy maintenance unit for regravelling works and operational costs for four years, EDF assistance will include con- tinuation of the existing EDF training school (reorienting the program towards highway maintenance) and services of technical experts, namely an expatriate coordinator for the overall maintenance program and mechanical experts for rehabilitation of Government's existing equipment. The EDF assistance will start in 1978 with continuation of the training school, recruitment of the coordinator (to be placed in DGPW as Assistant Director in October 1978) and other expatriates, and with procurement of equipment for the heavy unit imme- diately thereafter. The EDF assistance to the program would total CFAF 1.2 billion (US$5.0 million). EDF will also direct the overall foreign-assisted maintenance program; their experts will work closely with Government personnel both at managerial level and in the field. Government workshops and spare parts will be used to rehabilitate the existing equipment with the help of expatriates. This could be a good continuation of a working relationship between foreign and local staff. 3.26 To form a rehabilitation unit FAC will provide in the fall of 1978 part of the equipment and funds to cover its operating expenditures for two years; totaling CFAF 175 million (US$0.7 million). FRG will provide the other part of the equipment and funds for operational expenditures for up to four years, totaling CFAF 294 million (US$1.2 million). In 1979 FAC will provide one light unit and its existing heavy unit at Berberati would also be used for maintenance program operations, after the work at Berberati is finished. Providing program performance is satisfactory, FAC would most likely continue  - 14 - financing operating expenditures of the units after the initial two years. Both FAC and FRG have agreed to EDF's managing the overall program and to Government personnel's participation in the operations for training purposes. 3.27 The road network to be maintained under the program and the dis- position of particular units used will be as follows: (i) one heavy unit, provided by EDF in 1978, on regravelling the Bossemtele-Garoua Boulai section (300 km) of the road to Cameroon; (ii) one rehabilitation and one light unit, provided by FAC and FRG in 1978, on regrading the Bossembele-Bossemtele section (140 km) and maintaining the road to Cameroon; and (iii) one heavy unit, which may eventually be provided by FAC in 1979 from the existing equipment at Berberati, on regravel- ling of the Sibut-Bambari road (200 km). Overall foreign aid will be about CFAF 1.7 billion (US$6.9 million) and the primary network covered by the foreign-assisted maintenance program will total 640 km. 3.28 The extent of road network to be covered by the Government is not yet known. The sections of roads to be maintained by the DGPW units will be identified after the arrival of the EDF coordinator (para. 3.25) and after the recommendations of the maintenance study (para. 3.23) are received. However, the existing organization of "cantonniers", which is in charge of daily routine maintenance operations, is spread throughout the whole country. 3.29 At the April 1977 meeting, the foreign donors discussed with the Government its contribution to the Road Fund over the next four years. Gov- ernment officials confirmed that CFAF 500 million (US$2.0 million) would be allocated annually but were unable to indicate any likely increase above that amount. The Government assured the foreign donors of its intention to continue highway maintenance operations after the four-year program period and even- tually to take over from foreign donors the management and financing of main- tenance. However, the Government officials felt it was too early to formulate a view on whether further foreign financial assistance would be needed. 3.30 The Association is satisfied with the arrangements made by the foreign donors for road maintenance assistance with Government participation. However, in view of the Government's current budgetary constraints, the Asso- ciation will regularly review the status of the Government's contributions to the maintenance program (para. 3.23). To attain this objective, the Government and the Association have agreed on annual budgetary allocations (1978-81) of CFAF 500 million for highway maintenance and on the timing of their disbursement.  - 15 - 4. THE PROJECT A. Description 4.01 The proposed project consists of the reconstruction of the Bangui- Boali-Bossembele road (145 km) to two-lane bituminous sealed standard, in- cluding engineering services by consultants, and of the laboratory services for the supervision of construction works to be carried out by DGPW with the assistance of FAC personnel. 4.02 The Bangui-Bossembele road is one of the three principal road outlets from the capital, the other two being Bangui-M'Baiki road and Bangui- Damara road. Of these three roads, only the Bangui-Bossembele road (see map) is not bituminous sealed. The start of the existing road and of the project is located north of Bangui at PK 11.5 on the Bangui-Damara road which was built under FED financing in 1968. The volume of traffic on the Bangui-Damara road is high, and its two-lane bituminous sealed carriageway in the section near Bangui is in bad condition and requires pavement strengthening. The Government has not yet found an external source of financing to improve 8 km of the road. It agreed, however, that as a temporary solution a force account unit of DGPW will carry out the most urgent repairs. 4.03 The first 84 km to Boali Post of the Bangui-Boali-Bossembele road passes through low, flat terrain and rolling savanna at an average elevation of 350 to 400 meters. From Boali Post the road follows hilly terrain for about 6 km, crossing the steep escarpment of Boudou at PK 90. After Boali Falls (PK 94) the road reaches a plateau (elevation over 600 meters) and continues through rolling and occasionally hilly forest to the village of Bossembele (PK 157). The total length of the existing road is 148 km. The present Bangui-Bossembele road is an all-weather road and is 5.0 to 5.5 meters wide, with laterite surface. Despite the generally good condition of the road, movements of heavy vehicles are restricted during the rainy season, with all vehicles weighing over 2.5 t barred from using the road, usually for about six hours after rain, to allow the carriageway to dry. The road was not en- gineered and was constructed mainly by clearing and grubbing the ground and spreading a layer of lateritic soil. As a result most of the road is at or below the level of the surrounding ground and drainage is unsatisfactory. However, its horizontal and vertical alignments, with some exception, are adequate and allow reasonable travel speeds in dry weather. 4.04 There are two major river crossings on the existing road, M'Poko River at PK 23.6 and M'Bali River at PK 57.4. Both crossings are provided with single-lane bridges, 73 meters and 55 meters long respectively. The bridge structures are of reinforced concrete and are in satisfactory condi- tion. The bridge at M'Bali River is, however, poorly sited with dangerous curves at both approaches.  - 16 - 4.05 Geologically the basement of the savanna region in the Bangui-Boali section is constituted of quartzite, diorite, conglomerate and sandstone for- mations while quartzites and schists are found at the plateau of Bossembele. These formations should provide suitable road pavement building materials, and they seem to be available in adequate quantities and within reasonable hauling distances. Subgrade soils are lateritic with a significant clay con- tent. They exhibit high plasticity but do not swell and their permeability is low. The subgrade bearing strengths are fairly high, with average CBR's over 35%. 4.06 The proposed project road on the improved alignment will be 145 km long and will be constructed to a two-lane bituminous sealed standard. It will have a carriageway 6.0 m wide on a formation 8.0 m wide (Table 8). A design speed of 80 km/h has been adopted for geometric design and a maximum permissible single-axle load of 13 tons considered for pavement design. The carriageway wearing-course will consist of a double bituminous surface treat- ment on a base and sub-base course with an overall thickness of 30 cm. The design standards (Table 8) are consistent with the projected traffic require- ments, terrain configuration and general soil conditions in the area; they are also in general accordance with the standards presently being considered by the Trans African Highway Coordinating Committee. The proposed reconstruc- tion includes provision of adequate drainage for the project road and the construction of a two-lane bridge on a modified alignment at M'Bali River crossing. The existing bridge at M'Poko River will remain in use. 4.07 The feasibility study and the detailed engineering for the recon- struction of the Bangui-Bossembele road were prepared by consultants Louis Berger (USA) and financed under the Second Highway Project (Credit 199-CA). The study was completed in June 1972. The detailed engineering was deferred due to low traffic volume at that time, but was completed in October 1975 and submitted, together with the bidding documents, to the Association for review and approval. Recently some minor work has been done to finalize detailed engineering and bidding documents. The DGPW employed Louis Berger (USA) to carry out this work together with the prequalification of contrac- tors and the evaluation of bids, which was completed in April 1978. B. Cost Estimates 4.08 The total project cost (construction period 1978-1981) is estimated at US$25.7 million equivalent, net of identifiable taxes and duties; foreign costs amount to US$22.4 million (87%) and local costs amount to US$3.3 million equivalent (13%). The Government has exempted the construction contract from taxes and duties, which woul total about US$3.6 million equivalent. Earth- works average about 5,500 m /km and reconstruction cost per kilometer is about US$170,000 including physical and price contingencies. Details of cost estimates (in first quarter of 1978 prices) are given below:  - 17 - -CFAF Million-- -