Benin - Fourth Highway Project

Document of FIL COPI The World Bank FOR OFFICIAL USE ONLY Report No. 3212-BEN BENIN FOURTH HIGHWAY PROJECT STAFF APPRAISAL REPORT April 9, 1981 Western Africa Projects Department Highways Division This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS Currency Unit = CFA Franc (CFAF) US$1.00 = CFAF 220 CFAF 1 million = US$4,546 FISCAL YEAR January 1 - December 31 WEIGHTS AND MEASURES: Metric System Metric British/US Equivalents 1 meter (m) 3.28 feet (ft) 1 kilometer (km) 0.62 mile (mi) 1 square kilometer (km2) 0.386 square mile (sq. mi) 1 metric ton (m ton) 2,204 pounds (lb) 1 hectare (ha) 2.47 acres 1 cubic meter (m3) 1,308 cubic yards ABBREVIATIONS AND ACRONYMS BOAD Banque Ouest Africaine de Developpement CAA Caisse Autonome d'Amortissement (Ministry of Finance) CARDER Centre d'Action Regionale pour le Developpement Rural CERFER Centre Regional de Formation pour l'Entretien Routier, Togo CNERTP Centre National d'Essais et de Recherches des Travaux Publics DAMB Direction des Affaires Monetaires et Bancaires DRDR Division des Routes de Desserte Rurale (Feeder Roads Division) DRP Direction des Routes et Ponts (Directorate of Roads and Bridges) DTT Direction des Transports Terrestres EDF European Development Fund FAC Fonds d'Aide et de Cooperation, France FR Fonds Routier (Road Fund) GNP Gross National Product ITC Inter-ministerial Technical Committee MTPCH Ministere des Travaux Publics, de la Construction et de l'Habitat (Ministry of Public Works, Construction and Housing) MTC Ministere des Transports et des Communications OCBN Organisation Commune Benin-Niger des Chemins de Fer et des Transports SONACOTRAP Societe Nationale de Construction et des Travaux Publics STI Subdivision des Techniques Industrielles (Equipment Maintenance Division) UNCDF United Nations Capital Development Fund  FOR OFFICIAL USE ONLY PEOPLE-S REPUBLIC OF BENIN FOURTH HIGHWAY PROJECT STAFF APPRAISAL REPORT Table of Contents Page No. I. THE TRANSPORT SECTOR .......................................... 1 A. The Land, Population and Economy ..................... 1 B. The Transport System .. ........... .................... 1 C. Transport Policy and Sector Management .... ........... 2 D. Bank Group Assistance to the Transport Sector ........ 3 II. THE HIGHWAY SUBSECTOR. ... ....... 4 A. The Network... 4 B. Characteristics and Growth of Road Traffiic.. 4 C. Road Transport Industry .... .... 5 D. Road Safety and Vehicle Regulation ................... . 5 E. Road Administration ................... ... .. ........... 6 F. Staffing and Training . . . 7 G. Road Planning . .. 8 H. Road Engineering, Construction and Procurement 8 I. Road Maintenance ...................................... 9 J. Financing ... 10 K. Previous Highway Projects . . . 12 III. THE PROJECT ....14 A. Objectives... ................. . . 14 B. Description ....14 C. Cost Estimates ....18 D. Procurement ......................................... . 19 E. Implementation . .................. .................... 20 F. Financing, Disbursements and Reporting. 20 IV. ECONOMIC EVALUATION ....27 A. Laterite Road Rehabilitation Program .28 B. Paved Road Rehabilitation and Resurfacing .30 C. Sensitivity and Risks .30 V. AGREEMENTS REACHED AND RECOMMENDATIONS . .31 This report was prepared by F. Johansen (Sr. Economist) and C.J.D. Lane (Highway Engineer) on the basis of an appraisal mission in Benin in July 1980. 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.  - ii - ANNEXES 1. Outline Terms of Reference for the Technical Assistance for Road Rehabilitation, Training and Road Safety. 2. Documents available in the Project File. MAP IBRD-15423 CHART World Bank-22135  I. THE TRANSPORT SECTOR A. The Land, Population and Economy 1.01 The People&s Republic of Benin covers 112,600 km2. It lies between Nigeria to the east, Togo to the west and Upper Volta and Niger to the north; it has a southern seaboard of some 150 km. The terrain is mostly flat or rolling except for the Atacora mountains in the northwest, and changes from sandy soils in the south to clayey soils of various types in the north. The south has two rainy seasons with an annual average rainfall of 1,300 mm; in the north a single rainy season averages 1,000 mm. 1.02 According to the results of the 1979 census, Benin has about 3.3 million inhabitants of whom 1.8 million are concentrated in the three coastal provinces (about 11,700 km2) where about 800,000 live in urban areas, especially Cotonou and Porto Novo, and 1 million live in rural areas with a density of 154 persons/km2. Population densities decrease consider- ably northwards, to about 30 persons/km2 in the center (Zou) and 12, persons/ km2 in the north (Borgou and Atacora). The populaLtion growth rate is about 2.6% p.a. While the rural population has been increasing at only 1.3% on average and has even decreased in Zou and Mono provinces, the urban popula- tion has been increasing at 8%. 1.03 The mainstay of Benin's economy is agriculture. In the south, the land is intensely cultivated, but even so, food production is not enough to meet local consumption. In the north only about 4k% of cultivable land is actually under cultivation but it produces enough for an exportable surplus; livestock is also reared there. Agricultural production stagnated during the 1970s; fishery output, traditionally an important food item in the south, has declined because of a rise in the salinity of Lake Nokoue. The value of production per rural inhabitant varies widely: the highest, about $110, occurs in the center, about $90 in Borgou, and as low as $50 in Oueme. Productivity in agriculture can be greatl, improved and is one of Government's objectives, the more so as the income increase essentially depends on improving agriculture, as Benin has feew other exploitable natural resources. 1.04 The one-third of the population engaged in other than agricultural activities produces two-thirds of the GNP. The transport and trade sectors are especially important as Benin handles most of Niger's import-export traffic, and in recent years has also handled part of Nigeria's traffic. Secondary and tertiary sector incomes show even greater disparities than in agriculture but are in general higher and increase the average income per capita to an estimated $250 (1979). This is one of the lowest in the world. B. The Transport System 1.05 Transport is particularly important in Berlin, as it serves both domestic needs and the transit needs of neighbors; it contributes about one-fourth of the GNP and absorbs about one-fourth of public investment - $250 million of the $1,110 million 1977-80 investment program.  - 2 - 1.06 The port of Cotonou is the focal point of the system; it was built in 1965, and has four general cargo berths, a jetty for bulk cargo, a transit area and a fishing quay. An expansion is in progress, involving an additional 610 m of general cargo berths with transit sheds, hardstandings, road and railway services, and a new cut-off breakwater. Its total cost is estimated at $50 million, financed by IDA and seven other agencies. The port handled about 1.4 million tons in 1979, almost half destined for Nigeria via the coastal paved road (38 km), and about 25% for Niger, via the OCBN 1/ railway to Parakou (440 km) and from there via the Parakou-Malanville paved road (320 km). This rail/road combination is known as "the Benin route". 1.07 The OCBN railway is jointly owned by Niger and Benin. It operates the main line from Cotonou to Parakou and charters trucks to carry goods from Parakou to Niger; two-thirds of general cargo and all fuel oil products are apportioned to truckers from Niger. OCBN also operates the Cotonou- Segboroue and Cotonou-Pobe railway lines, which carry mainly passengers. In all, the railway carries about 80 million ton-km per year and after the Government, is the second largest employer in Benin. To protect the railway, Government discouraged upgrading the road parallel to the rail line and only allowed cars and light trucks, and occasionally heavy trucks after paying a fee, to use the two railroad bridges adapted to accommodate road traffic and which were the sole means of crossing the Zou and Oueme rivers, thus keeping road traffic to a minimum. However, a road bridge over the Zou was opened in 1980 and one on the Oueme will be built as part of the Dassa - Parakou road, probably in 1982-84. 1.08 The country's only international airport at Cotonou handles some 4,000 flights annually; in 1978, these carried about 39,000 passengers and 3,900 tons of freight. Benin has also five small airfields, but domestic air transport is not important. Benin is a shareholder in Air Afrique and UTA and runs the domestic carrier Air Benin. 1.09 Road transport is the most important means of moving goods and passengers. The paved network comprises only about 900 km, recently built or being resurfaced or rehabilitated. There are about 2,700 km of gravel roads and about 3,700 km of feeder roads, most of which are in poor condi- tion. Details of the road sector are given in Chapter II. C. Transport Policy and Sector Management 1.10 Responsibility for transport policy is shared between the Minis- tries of Transport, Public Works and Planning but there is only ad-hoc cooperation between them. The Ministry of Transport is responsible for the collection and analysis of transport statistics, the review of tariffs, and preparation of investment proposals. The Ministry of Planning has identi- fied lists of improvements and study needs, but no "plan" as such has been prepared, as the priority needs are expected to absorb most of the available financing. The Government's main objectives in the transport sector are upgrading of low standard roads, following priorities set by traffic growth and developments in agriculture; improving road maintenance capacity; and 1/ Organisation Commune Benin - Niger des Chemins de Fer et des Transports.  increasing the comparative advantage of the "Benin route" vis a vis competing routes by completing the paved road to parallel the railway and also extend the railway to the Niger border Niger is studying its further extension to Niamey. 1.11 Several actions are already underway to make the North-South or Benin route more attractive. The port is being expianded and should have sufficient capacity to meet foreseeable needs. The European Development Fund (EDF) is assisting in financing the paving of the Bohicon-Dassa Zoume road section paralleling the railway, and has already financed a feasibility study for paving the remaining gravel section, from Dassa Zoume to Parakou (210 km). The study concluded that paving would yield a rate of return of about 14%; the detailed engineering is being prepared and is expected to be completed in 1981. The construction cost is estimated at about $50 million, and EDF is prepared to finance about half that amount. The paving of the Dassa-Parakou road will probably take place in 1982-84 and will certainly cause a diversion of some Niger traffic from rail to road. On the railway side, the Fonds d'Aide et de Cooperation (FAC) financed a feasibility study on extending it to Niamey; the study concluded that such an extension would yield a return of about 13%. As a result, FAC is considering helping to finance the works, expected to cost $750 million, and both the Benin and Niger governments are seeking additional sources of financing. However, support has not been encouraging. The consultant's report is thought to be overly optimistic and there are many risks involved, as for instance the instability of the uranium market, and traffic diversion to the road; a more realistic rate of return would be as low as 4%. To ensure the continued use of an improved "Benin route", the Governments of Benin and Niger have signed an agreement by which 90% of Niger-s import-export traffic will travel via that route. 1.12 The Government also intends to improve the access to landlocked Upper Volta, for which it has recently cofinanced the international bridge at Porga and has commissioned a study financed by BOAD 1/ to determine which alignment south of Djougou should be adopted and improved: via Parakou or via Savalou. Efforts are also underway to improve about 700 km of feeder roads through IDA, EDF and the UN Capital Development Fund (UNCDF) assistance, and some 470 km of main roads under the Third Highway Project. Further, IDA has approved an additional feeder road project, while EDF is prepared to finance some gravel road rehabilitation, and the proposed project would assist in further institution building and road maintenance and upgrading. D. Bank Group Assistance to the Transport Sector 1.13 The Bank Group has supported the transport sector in Benin with five projects: four road projects and one port project. The total cost of these five projects is $108.7 million with an IDA contribution of about $50.8 million. The first project (Credit 215-DA, $3.5 million 1970), was for highway maintenance; the second (Credit 415-DA, $20.8 million, 1973), for the reconstruction of the Parakou-Malanville road and 2 sections of the Bohicon-Godomey road; the third (Credit 746-BEN, US$10 million, 1977) for 1/ Banque Ouest Africaine de Developpement.  - 4 - reconstruction of the remaining section of the Bohicon-Godomey road and maintenance and rehabilitation of main roads; the fourth (Credit 717-BEN, $5.5 million, 1977) for construction of feeder roads; and the fifth (Credit 826-BEN, $11 million, 1978) to expand the Cotonou Port. The Bank has thus supported the transit corridor role, upgrading of most of the important roads, and institution building, including training. Experience under previous highway projects is discussed in Chapter II. 1.14 The Bank strategy is to continue past efforts: feeder road up- grading under the second feeder road project; institution building, training and upgrading of gravel roads under the proposed Fourth Highway Project; while a fifth highway project would assist in paving the last gravel section of the main north-south road. The Bank does not, however, support the railway extension (para 1.11). II. HIGHWAY SUBSECTOR A. The Network 2.01 Benin has a road network of reasonably adequate extent, about 7,270 km. Some 900 km are paved, some 2,700 km are laterite-surfaced and the remainder are earth roads, many impassable during the rainy season. The road density follows population density: around 130 m/km2 in the coastal areas, 70 m/km2 in the center and 55 m/km2 in the north, with an average of 65 m/km2. Paved roads are mostly 6m wide and most are in satisfactory structural condition, though the 6m width is already inadequate for the main interstate routes. Engineered gravel roads have been poorly maintained in the past; some 270 km are being regravelled under the Third Highway Project, and the proposed project will improve another 500 km, with a further 200 km being improved though not completely regravelled under routine maintenance each year. Few feeder roads are all-weather roads, but almost 1,400 km should be by the end of the various feeder road projects (para. 1.12). Road Network by Classification and Surface Type - 1980 Primary International National Secondary Tertiary Roads Roads Roads Roads Total % ----------------------(km)--------------------------- Paved 782 112 - - 894 12 Gravel 1,162 992 539 - 2,693 37 Earth 179 - - 3,500 3,679 51 Total 2,123 1,104 539 3,500 7,266 B. Characteristics and Growth of Road Traffic 2.02 According to available but inadequate data, the vehicle fleet was about 11,000 in 1970; 12,000 new plates were issued when registration pro- cedures were unified in 1975. The 1980 fleet estimate based on registration  - 5 - data to 1978 and a growth rate of 4.5% p.a. is 15,000 vehicles, of which about 50% are passenger cars, 30% small trucks and 20% iare heavy vehicles (Table below). Fuel consumption decreased in 1973 and 1974 but recovered in 1975 and since then has increased about 3.5% p.a. Vehicle Registrations - 1970-78 Vehicle Type Passenger Pick Trucks Trucks Trucks (over 13t) Special Year Cars Ups 1.5-7t 7-13t & Trailers Buses Purpose TOTAL 1970 384 75 83 168 66 - 5 781 1971 354 58 182 115 81 3 3 796 1972 380 - 214 135 97 - 4 830 1973 320 113 131 80 92 1 10 747 1974 244 37 183 88 90 1 10 653 1975 557 385 162 97 104 2 5 1,312 1976 1,019 160 187 105 152 71 23 1,717 1977 1,525 77 970 107 366 5 47 3,097 1978 1,980 98 1,205 100 479 12 60 3,934 1978 fleet 6,763 1,003 3,317 995 1,527 95 167 13,867 (estimate) Source: Directorate of Land Transport, March 1980. C. The Road Transport Industry 2.03 There is no restriction on the setting up of trucking companies, and the road transport industry consists of a number of semi-public and private enterprises. The most organized is the Nigerien-Beninese TRANS-BENIN which complements the OCBN for international freight. Six transport companies, one in each province, operate to satisfy social needs rather than to make profits. These companies, however, break even and are self-sufficient, charging a flat rate CFAF 22 per ton-km. Private truckers, mostly small operators with four vehicles or less provide mostly local, short distance services, and most of the interstate and national transport. In addition, some enterprises have their own fleets to meet their transport needs. While the Ministry of Trans- port establishes fares for the private transport services, they are not enforced and truckers charge what the market will bear and cross-subsidize customers in a competitive environment. D. Road Safety and Vehicle Regulation 2.04 The Land Transport Directorate (DTT) of the Ministry of Transport and Communications (MTC) is responsible for road regulations in Benin. Increased awareness of the problem of traffic accidents prompted MTC to create a National Committee for Road Safety in 1978, which under the Ministry's  - 6 - direction, started working in 1979. The committee's program, though stili rudimentary, consists of improving road traffie regulations, an educational campaign, regular vehicle inspection, and better road signs. The traffic regulations will be reviewed by a regional committee under the Conseil de l'Entente 1/, to achieve uniformity among the member countries. Vehicle inspection is done by each Public Works subdivision--taxis every three months, trucks every six months and others once a year--but is limited by lack of installations and equipment. Those who comply do so mostly because the insur- ance company requires a vehicle inspection certificate. Road signing and marking, if any, is done as part of the initial road construction. The pro- posed project would aid the Government in improving road safety (para. 3.10). 2.05 Although the official axle-load limit is 13 tons, a regional study under the Conseil de l'Entente will be launched in 1981 to determine whether another limit would be more appropriate; the Association has been involved with the terms of reference for the study. The Government wants to enforce the axle limit in order to prevent road deterioration, especially on the interstate routes. To this effect, two weighbridges have been installed, one at Parakou (but which is out-of-order after being damaged by an over- weight truck), and another at Malanville; both control mostly traffic to Niger. In the past, DRP personnel merely weighed vehicles, lacking any means of enforcing legal limits. Enforcement at the Parakou weighbridge is now assured by the presence of police; while the weighbridge is out of order, the bill of lading is inspected and overloaded trucks are sent back to the railway depot to unload as required. Still, violations seem quite common. The DRP plans to repair the weighbridge at Parakou, and to install two other weighbridges on the coastal road to check traffie in the south. As there are no penalties for violations, appropriate regulations should be issued and enforced. The proposed project would assist in improving regulations governing axle load limits and enforcement, and would provide two new weighbridges (paras. 3.10, 3.11). E. Road Administration 2.06 The Ministry of Public Works, Construction and Housing (MTPCI), through its Directorate of Roads and Bridges (DRP), is responsible for con- struction and maintenance of the primary and secondary roads, and some 1,200 km of feeder roads. Responsibility for the remainder of the roads (mostly unclassified) nominally lies with the Ministry of Interior and local authori- ties, but will be taken over gradually by DRP. DRP has five divisions: Road Maintenance, Equipment Maintenance, Feeder Roads, Studies, and Super- vision of New Works (these are described under subsequent headings). The Directorate operates through four district offices which in turn have three to five subdivisions. The organization is shown in Chart 22135. The national laboratory (CNERTP) operates as an autonomous state owned firm, but under the supervision of MTPCH. The laboratory which is adequately equipped and staffed, does materials testing for Government and contractors. 1/ The Conseil de l'Entente is an organization of Benin, Ivory Coast, Niger, Upper Volta and Togo to promote and coordinate political, social, and economic policies.  - 7 - 2.07 The structure and quality of senior technical management of DRP are adequate. DRP's main problem is poor administration: cumbersome proce- dures, insufficient staff and high turnover considerably delay works and result in unnecessarily higher costs. For example, recently, two years have elapsed between a call for tenders and delivery of the equipment. To overcome this deficiency, an Administrative Division is being set up to improve anci accelerate DRP's processing of contracts, purchases, payments, analytical accounting and other routine matters. So that this division can become operational quickly, the Ministry is prefinancing the construction of office space, under an extension to a contract for the construction of a building for the Feeder Road Division, financed under the First Feeder Road Project. The Ministry has already assigned some staff to the division, trained under the First Feeder Road Project or under the Third Highway Project, and the proposed Project would further assist in establishing the Administrative Division (para. 3.03). F. Staffing and Training 2.08 DRP currently employs about 1,000 people of whom about 700 are permanent employees and 300 (mainly laborers) are employed on an annual basis with financing from the Road Fund. This nuiber is too large compared to the equipment available; however, there are shortages of competent admini- strative and workshop staff and middle-level managers. Like similar institu- tions elsewhere, DRP and particularly its mechanical branch, suffer the usual competition from the private sector. The creation of a limited number of new posts for qualified personnel will not be difficult, but recruitment of experienced people will be. 2.09 Until recently, Beninese engineers and technicians were trained mostly in France or Bamako, Mali, but in 1980, the first three-year course at the new College Polytechnique Universitaire du Benin was completed with 16 graduates in civil engineering of whom at least five are expected to join MTPCH. Training at "Adjoint Technique" level for civil engineering techni- cians is given at the Complexe Polytechnique Coulibaly during a special one year course financed under the Third Highway Project, which graduated 12 students last year, all of whom have entered DRP. At DRP's request, the course is being repeated this year. The quality of the graduates is encourag- ing and they are gaining experience fast within the various branches of DRP. Mechanical technicians receive a sound training at the Regional Training Center for Road Maintenance (Centre Regional de Formation en Entretien Routier CERFER), in Lome, Togo. Benin has a quota of 15 places a year, as deter- mined by its subscription to CERFER's running costs. MTPCH has requested an increase in its quota but at present all that CERFER is able to offer beyond the quota are special courses for field repairmen and equipment operators, to be run during the center's vacations; the proposed project would finance the Beninese participation (para. 3.06). Various colleges and trade schools provide (very) basic training for lower level mechanics and tradesmen. The IDA-financed skills upgrading center is nearing ecimpletion in Cotonou, but will mainly benefit private companies.  -8- 2.10 The major needs at present are: (i) for the new graduates to gain on-the-job experience; opportunities for this are created by the various expatriate-supervised feeder roads and regravelling brigades now operating and to be continued in the proposed projects; and (ii) upgrading the skills of the existing work force. Meeting this last need will be the main thrust of the proposed project's training effort (para. 3.05). G. Road Planning 2.11 Road planning is done on an ad-hoc basis as a result of a rather informal association between the MTC's Directorate of Studies and Planning (which received three man years of expert assistance under the Third Highway Project), DRP which does minor feasibility studies and traffic counts; and the Ministry of Planning, Statistics and Economic Analysis. There is a reasonable data base of transport statistics but there is little or no formal planning at the road network level; the list of road projects which emerges from this process is usually subject to close scrutiny by prospective lenders by whom projects are subsequently fully appraised. At the feeder road level, a capacity to appraise projects based on a proper data base and methodology has been established in the Division of Rural Roads, created under IDA's First Feeder Roads Project, and which has become the focus of the hitherto uncoordinated rural road activities. H. Engineering, Construction and Procurement 2.12 The Divisions of Studies and Supervision of New Works reviews all engineering studies, supervises new construction works with the assistance of consultants as needed, and occasionally executes minor engineering work and field surveying. Soil and materials testing for new works is done by CNERTP. In the southern half of the country good materials are scarce and the proposed project will support a small research by CNERTP into this problem. Engineering and supervision for major road construction works is done by consultants, and works are executed mainly by foreign contractors. In 1976, the Government established a National Construction Company (Societe Nationale de Construction et des Travaux Publics, SONACOTRAP), which in a joint venture with a foreign firm, is executing resurfacing works under the Third Highway Project. Other local, private contractors are mainly engaged in housing and can only do small projects. Rather than develop private domestic contractors, the Government intends to increase its own force account capacity for minor road works and SONACOTRAP for major ones. However, small local firms would build the drainage structures involved in the laterite roads rehabilitation program (para 3.18). 2.13 With foreign donor assistance, DRP has developed its force account capacity to carry out both periodic maintenance and rehabilitation/upgrading of the laterite main roads and for feeder road construction. Two equipment- intensive brigades are satisfactorily executing a regravelling program on selected main roads with assistance provided under the Third Highway Project. Each brigade has an output of about 80 km a year of 9-8m platform width and  gravelling on 7m, at an average cost of $13,000/km including technical assistance. Five brigades are 'building feeder roads, one brigade financed by EDF, and four under the First Feeder Road Project; two more are foreseen under UNCDF financing. Four of these brigades are labor intensive with minimum equipment back-up; each has recently achieved an output of about 45 km a year, of 6-5m platform width, and gravelling over 4m, at an average cost of $11,200/km, including technical assistance. The intermediate and the equip- ment intensive brigades build about 75 km and 100 km a year, respectively, at a similar cost. 2.14 Equipment-intensive brigades are used on main roads because labor- intensive brigades are not economical for this kind of work. For the long sections of the main network to be upgraded, an equipment-intensive brigade can advance almost three times faster than a labor-intensive brigade, while achieving better and more lasting quality and realizing benefits earlier. Labor-intensive brigades, on the other hand, seem well-suited and economical for building feeder roads, at least in the densely populated south where labor is readily available and the prevailing monthly wage is CFAF 9,900; soils and terrain conditions are also favorable inL this area. Already about 700 persons are employed in feeder road construction and many more for mainte- nance. Laborers are recruited to work within commuting distance of their homes, thereby avoiding transport and feeding on the site problems. A labor- intensive brigade will be tried in the north under the Second Feeder Road project. 2.15 Contracts for major highway projects are awarded on the basis of international competitive bidding. The Studies and New Works Division calls for and evaluates bids; a representative of the President of the Republic must by law participate in the evaluation. The Minister of Public Works signs the contracts and the Minister of Finance countersigns. Government procurement procedures provide adequate safeguards but their weakness lies in the long delays they impose for even small contracts. DRP intends to investigate ways to open accounts to be settled monthly with its major suppliers, including the national oil supplier SONACOP. I. Road Maintenance 2.16 Routine maintenance is carried out at sub-division and sector level (see Chart) by permanent DRP staff paid by the state budget. The geographical coverage of sub-divisions is generally adequate; a new unit is to be created at Pehunko when the existing sub-division at Natitingou is upgraded to an "arrondissement". Routine maintenance of paved roads is done by DRP teams which have been re-equipped under the Third Highway Project. Grading and ditch clearing are executed by machine, while the clearing of pipes and culverts and patching are done by hand. Staffing levels are at present "generous" but will hopefully become "adequate" with the increased tempo of activity anticipated. Funds for wages, operations, and equipment maintenance are not in balance, with equipment available resulting in an under-utilization of labor. As a result DRP is mioving to more labor-intensive methods of routine maintenance, and is devising umeans to finance equipment purchases (para. 2.22). Special brigades for feeder road maintenance are  - 10 - attached to each "arrondissement", but there is a proposal to redistribute responsibility for feeder roads geographically among the subdivisions, and to finance it by a small levy to be included in the official prices (baremes) of cash crops. 2.17 Periodic maintenance of paved roads is done by contract. 111 km are being resealed under the Third Highway Project, and there are no plans to create any force account capability for this type of work. Periodic mainte- nance of laterite roads is done by force account, according to annual programs of works which are budgetted on a job-by-job basis. At present two brigades are working, under the Third Highway Project, one in the north and one in the south, manned by the staffs of the appropriate arrondissement and mostly with equipment that was previously assigned to routine maintenance. Under the proposed project, the teams would remain intact but be completely re-equipped. Their existing equipment will be re-assigned to routine maintenance. 2.18 Mechanical repair and maintenance services are provided by the Equipment Division (STI) which, although belonging to DRP also provides services for Government cars in Cotonou and to private companies. Its main workshops, stores and offices in Cotonou are more than adequate in extent, but are ill-equipped for their task, under-financed and lack the administrative means to obtain and pay for parts and materials quickly. Outside Cotonou are an "annex" at Parakou, which was never really established physically or financially, and the "garages" at each subdivision which handle only oil changes and minor adjustments and replacements. The proposed project would train workshop staff, establish two repair centers outside Cotonou, and supply some additional equipment to the Cotonou workshops, (para. 3.04). J. Financing 2.19 DRP activities and road construction and maintenance are financed from four principal sources. New construction is financed mainly by multi- lateral or bilateral agencies with the Government contributions of about 30% of the cost of projects under its development budget through the Caisse Autonome d'Amortissement (CAA). Periodic and routine road maintenance are financed by the Road Fund (FR), set up for road maintenance and road related studies in 1970, and which receives money from two principal sources: a portion of the tax levied on sales of gasoline and diesel fuel; and contri- butions from the state budget. In addition MTPCH has its own budget for salaries of permanent staff, office and administrative expenses. Total expenditures for road construction and maintenance are shown in Table 1. 2.20 The Road Fund is administered by a board chaired by the Minister of Finance. An annual budget is established; the Director of DRP is res- ponsible for the funds, and expenditure is administered by an accountant proposed by the Ministry of Finance, which also audits the accounts. Maintenance total funding although much improved is still not adequate. Under the Third Highway Project, the Government agreed to increase alloca- tions from all sources of maintenance from CFAF 400 million in 1976 to CFAF 900 million in 1980. 'While these levels have been observed, the mission  - il - estimates that the minimum level required for FY 1982 will be CFAF 1300 million. The contribution from gasoline taxes, CFAF 4 per liter, represented about 8% of the pump price in 1970, but is now only about 3-4% at present fuel prices to consumers: CFAF 130, 127 and 104 per liter of super, re