Mauritania - Third Highway Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 4493 PROJECT COMPLETION REPORT MAURITANIA THIRD HIGHWAY PROJECT (CREDIT 519-MAU) May 16, 1983 Western Africa Regional Office This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.   FOR OFFICIAL USE ONLY PROJECT COMPLETION REPORT MAURITANIA THIRD HIGHWAY PROJECT (CREDIT 519-MAU) TABLE OF CONTENTS Page No. Preface. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .i Basic Data Sheet .... . . . . . . . . . . . . . . . . . . . . ii Highlights .... . . . . . . . . . . . . . . . . . . . . . . . . iv I. INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . 1 II. PROJECT PREPARATION AND APPRAISAL . . . . . . . . . . . . 3 III. PROJECT IMPLEMENTATION. . . . . . . . . . . . . . . . . . 7 IV. INSTITUTIONAL DEVELOPMENT ... . . . . . . . . . . . . . 19 V. ECONOMIC REEVALUATION .... . . . . . . . . . . . . . . 20 VI. PERFORMANCE OF THE GOVERNMENT, ASSOCIATION AND CONSULTANTS. . . . . . . . . . . . . . . . . . . . . . 22 Tables 1. Cost Estimates by Source of Finance . . . . . . . . . . . 25 2. Project Cost Estimates. . . . . . . . . . . . . . . . . . 26 3. Schedule of Disbursements ... . . . . . . . . . . . . . 27 Map IBRD 17243(PCR) 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.  I I  PREFACE Presented herewith is a completion report for the Third Highway Project in Mauritania, for which Credit 519-MAU for $3.0 million was signed on Nc*vrb 12, 1974. The project was co-financed by the Kuwait Fund ($3.2 million) and tV^ Canadian International Development Agency ($4.5 million). IDA disbursements of $209 million were completed on August 23, 1982, and the balance cancelled. The project completion report was prepared by the West Africa Region in December 1981 without a separate mission. No project performance audit report was prepared by OED. The completion report was sent to the borrower for comments; however, no comments were received.  0  - ii - BASIC DATA SHEET KEY PROJECT DATA Appraisal Actual or Item Expectation 1/ Current Estimate 2/ Total Proj,ect Cost (US$ million) 13.7 12.04 3/ Overrun ( - n.a. 4/ Credit Amount (US$ million) 3.0 3.0 Disbursed as of 8/23/82 3.0 2.944 Cancelled (9/21/82) None 0.056 Repaid None None Outstanding 3.0 3.0 Date Physical Components Completed 12/31/79 12/31/81 3/ Proportion Completed by 4/22/83 100% n.a. Proportion of Time Overrun - 29% 4/ Economic Rate of Return (%) 35% North, 16% South Negative 5/ Financial Performance Poor/Fair Institutional Performance Poor OTHER PROJECT DATA Item Original Retisions Actual or Plan Estimated Actual First Mention in Files or Timetable 1/72 1/72 Government's Application 7/72 7/72 Negotiations 9/74 9/74 Board Approval 11/12/74 11/12/74 Credit Agreement Date 12/11/74 12/11/74 Effectiveness Dwte 06/09/75 06/08/76 Closing Date 06/30/80 12/31/81 Borrower Republic of Mauritania Executing Agency 1) Ministry of Equipment for Infrastructure 2) Other Ministries for Technical Assistance Fiscal Year of Borrower Calendar Year Follon-on Project Name Fourth Highway Project Credit Number 1231-MAU Amount (SDR million) 3.4 Credit Agreement Date 05/20/82 1/ At an exchange rate of US$1 UM 50 2/ At an average exchange rate of US$1 = UM 45. 3/ Only part of the road program done and some of this only partially finished. 4/ See para. 3.42. 5/ Assuming roads not completed   - iii - MISSION DATA Item Sent Month No. of No. of Manweeks Date of By Year weeks Persons Report Identification/ Preparation/ Preappraisal Origin in/follow-up to Highway Maintenance Project Cr. 159-MAU Appraisal WAPHW 12/73 3 3 9 10/30/74 Supervision I 06/75 1 1 1 07/21/75 Supervision II 10/75 1 1 1 10/20/75 Supervision III 12/75 1 1 1 01/21/76 Supervision IV 11/76 3 2 6 03/10/77 Supervision V 06/77 2 1 2 07/20/77 Supervision VI 10/77 1 4 4 11/30/77 Supervision VII 12/77 .5 1 .5 02/01/78 Supervision VIII 01/78 2 1 2 04/21/78 Supervision IX 02/78 2.5 2 5 04/21/78 Supervision X 10/78 1 1 1 11/08/78 Supervision XI 11/78 1.5 1 1.5 12/14/78 Supervision XII 04/79 1.5 2 3 04/23/79 Supervision XIII 10/79 1.5 2 3 11/29/79 Supervision XIV 02/79 2 2 4 03/27/80 Completion None Total Supervision 21.5 35 COUNTRY EXCHANGE RATES Name of Currency: Ouguiya (UM) Year : Appraisal Year Average: 1974 Exchange rate: US$1= UM 50 Intervening Years Average (Disbursement Period): 1977-82 US$1- UM 45 Completion Year Average US$l= UM 45 4.22.1983  I  - iv - HIGHLIGHTS 1. The main purpose of the project was to continue the road maintenance program begun under the Second Highway Project, including improving the condition of the road system, strengthening the road maintenance organization, improving maintenance operations and training maintenance staff. The project included a betterment program on about 365 km of roads; the provision of highway equipment for maintenance and betterment works; technical assistance to the Ministries of Equipment, of Trade and Transportation, and of Planning; and a feasibility and detailed engineering study for the construction of the Rosso-Boghe road (200 km ). 2. Mauritania experienced severe economic and political problems which disrupted project implementation. The country suffered from several droughts, a guerrilla war, changes of Government, and worsening terms of trade, all of which further weakened the Governmentt s administrative ability and absorptive capacity. In addition, Mauritania left the CFAF zone, and France substantially reduced its technical assistance to the Ministry of Works, while the French project consultant experienced increasing difficulties dealing with the Government. These problems contributed to a substantial delay in procuring CIDA financed equipment, which in turn delayed the betterment component by about two years. Only 249 of 365 km of foreseen betterment works were partlv comDleted: little routine maintenance was implemented; and little training or institutional improvements were carried out. The actual project cost was close to appraisal expectations, but is not comparable because the project was reduced and the cost of completing the betterment works is not known. Little training was carried out, or institutional improvements made under the project because of the Governmentts preoccupation with country problems, its limited absorptive capacity, and possibly the poor relations with the French consultant. The overall economic return from the betterment works was re-estimated to be negative, assuming the roads are not completed, compared with an appraisal expectation of 16% for betterment roads in the North, and 35% for those in the South. The re-estimated economic return for one 50 km section which was successfully completed in the South by contractor was 13%, due to lower traffic and higher construction costs than expected at appraisal. The Fourth HIghway Project, which is not yet effective, includes studies and works which could eventually lead to the substantial completion of the betterment works in the reduced project. 3. The following points may be of special interest: (a) the effect of economic and political difficulties on project implementation (para. 3.02); (b) the effect on project implementation of withdrawing French technical assistance (para. 3.03); (c) the difficulty of implementing works by force account when institutions are weak (paras. 3.20 - 3.27);  - v - (d) the difficulty in improving project implementation when it is necessary to coordinate changes among three donors and an inefficient government administration (paras. 3.30 - 3.40).  I. INTRODUCTION 1.01 The transport system in Mauritania was rudimentary at independence. After the creation of the capital Nouakchott in a region devoid of basic infrastructure, the Government invested heavily in the 1960s in the transport sector. However the institutions involved in transport administration, planning and maintenance are not yet well developed. 1.02 External needs were and are met almost entirely by the ports at Nouadhibou and Nouakchott, airports in these cities, and a ferry service at Rosso near the mouth of the Senegal River which gives access to the transport system in Senegal. Internal transport needs are met by about 7,800 km of roads, of which 1100 km are paved and 600 km are improved laterite roads. Costs are high, particularly in the road sector because of the vast distances, topography and climate. 1/ Moreover, demand for road transport is relatively small, comprising mainly fuel, construction material and food. There is a railroad, 750 km in length, owned by Miferma, a private iron ore mining company, to ship ore from the mine in Zouerate to the port in Nouadhibou for export. 1.03 The road system comprises four main axes: north-south from the Algerian border to Rosso, east-west from Rosso to Nema bordering the Senegal River and from Nouakchott to Nema in the center, and a route linking Boghe, on the Senegal River, to Tidjika in the center of the country. Except for the first axis and part of the second and third, the roads generally have indefinite alignments, and sandstorms in the North and floods during the wet season in the South sometimes make it necessary to drive vehicles cross- country. 1.04 The Bank's involvement in the transport sector started in 1964 with a credit of US$6.7 million for the Road Project, Cr. 69-MAU, comprising engineering and construction of the 200 km Nouakchott-Rosso Road and a road maintenance study. The road was completed on schedule in 1969. 1.05 A second credit, Cr. 159-MAU, US$3.0 million, was made in 1969 for the First Road Maintenance Project, 2/ based on the maintenance study carried out under Cr. 69-MAU. It comprised the provision of new maintenance equipment, a central workshop, training center and training of staff, reorganization of the Directorate of Public Works, and the creation of four brigades for road maintenance. The bulk of the planned road improvements and limited routine maintenance were carried out; however, less than half of the target set for 1/ In 1975 the cost of transporting a ton 1,400 km from the port at Nouakchott to Nema was US$140 and took nine days. 2/ Hereafter called the Second Highway (Maintenance) Project.  - 2 - training staff was met at project completion in 1975. A cost overrun ot US$345,000 was experienced, of which US$176,000 was financed subsequently under the Third Highway Project. The Audit Report dated Februaryb6, 1978 commented on the inadequacies of man-power resources and the dependence upon external assistance for project execution, the need for trainin6, tne inadequacy of funds for maintenance, and the harsh physical environment and attendant high unit costs. 1.06 The Third Highway Project, Credit 519-YiAU, for US23.0 million, tne subject of this Completion Report, was designed to continue the effort begun under the Second Highway Project, namely improving the road system, further strengthening the maintenance organization and improving maintenance, ana continuing the training effort. The information used in preparing this report was obtained from files, site inspections and discussions during supervision missions, and the final report of the consultants. The scarcity of information available from the Borrower has somewhat limited the completeness of the report.  II. PROJECT PREPARATION AND APPRAISAL 2.01 In July 1972, the Government requested a follow-up project to the Second Highway (Maintenance) Project, which was then well-advanced, with the primary objective of consolidating and expanding the results of the latter. The Association appraised the Third Highway Project in September/October and December 1973 on the basis of information provided by the Ministry of Equip- ment (ME) and the consultants, and its own findings; negotiations were held in Washington in September 1974. The Association (IDA), the Kuwait Fund (KF) and the Canadian International Development Agency (CIDA) agreed to co-finance the project, and separate agreements were signed between the Government and these agencies. The US$3 million IDA credit was signed December 11, 1974. A. Project Description 2.02 The project consisted of the following: (a) a betterment program on about 365 km of roads; (b) provision of highway equipment for maintenance and betterment works; (c) technical assistance to the Ministries of Equipment, of Trade and Transportation, and of Planning; (d) feasibility study and detailed engineering for the construction of the Rosso-Boghe Road (200 km). Betterment Program 2.03 This comprised the betterment of about 365 km of road sections, mere earth tracks without definite alignments on which traffic was often inter- rupted, of which 165 km were in the North and 200 km in the Southeast. 1/ The works included earthworks on new alignments to avoid sandy or periodically flooded areas, and the construction of surface courses, drainage, and light river-crossing structures. Equipment 2.04 This component was to provide the necessary equipment to complete the existing fleet of the highway brigades, including two compactors tank trucks, a crane, and a lowbed trailer. It was also intended to provide some equipment to continue building-up the maintenance capacity of seven of the nine field subdivisions to adequate levels, Nouakchott and Nouadhibou being already sufficiently equipped. 1/ Atar-Choum (125 km) Akjoujt-Atar (40 km) Boghe-Kaedi (100 km) Kaedi-Kiffa (2 sections totalling 100 km)  -4- Technical Assistance 2.05 The project provided for 350 man-months of technical assistance mainly as an extension of that provided under the Second Highway (Maintenance) Project, as follows: - five mechanical experts for 2-3 years for the Equipment Division of the Ministry of Equipment to supervise the repair of highway equip- ment, train operators and mechanics and prepare maintenance/repair manuals; - three highway experts for 2-3 years for the Road and Airport Division to help reorganize and train the field subdivisions, and program and supervise their activities; determine the needs of the highway recurrent budget; implement adequate accounting procedures for highway operations; carry out engineering for the betterment program; and provide supervision of the highway brigades; - a training expert for 3-4 months to prepare a training program; - fellowships; - a short term training expert to mount training programs; and - a transport planner/economist for two years to assist the Ministry of Plan (MOP) in the analysis of transport investments and transport organization; and a transport expert for two years to help the Ministry of transport train truckers in management and accounting techniques. Feasibility Study and Detailed Engineering of the Rosso-Boghe Road (Z00 Km) 2.06 This Rosso-Boghe Road was the priimary link between the existing paved road network and the Senegal River Valley, the agriculturally most productive area of the country. It was served by a poor earth road which was closed during half the year due to flooding. It was the most heavily traf- ficked of Mauritania's unpaved roads, and a prime candidate for improvement. B. Cost Estimate 2.07 The total cost of the project was estimated to be about US$13.7 million equivalent, of which US$9.5 million was for foreign costs and US$4.2 million equivalent for local costs, including US$2.4 million for taxes. Tne cost estimate was based on price levels at the end of 1974; for the technical assistance component they were estimated on the basis of Bank-financed con- tracts for similar services at the time; for the betterment program they were estimated on the basis of preliminary road surveys, and for equipment they were based on CIDA's estimate. 2.08 The cost estimate included a 10% physical contingency for the betterment program and equipment, and price contingencies which reflected Bank guidelines as follows (see also Table 1):  1975: 11% for goods and services and 15% for civil worKs; 1976-79: 7.5% for goods and services, and 12% for civil works, excluding equipment. As CIDA provided the equipment, the 17A. price contingency they estimated for one year was included in the Bank's cost estimate. The project was expected to be completed by December 31, 1979. C. Co-financing 2.09 The arrangements agreed were: (a) the Association and KF would finance, jointly, the totai cost, ex-taxes, of technical assistance, pre-investment studles ana tne betterment program in the ratio 44/56; (b) CIDA would finance the foreign exchange cost of equipment and related services; and (c) the Government of Mauritania would finance taxes. 1/ 2.10 On this basis the financing plan was: IDA KF CIDA GOVT. TOTAL in US$'000 equivalent Technical Assistance 890 1,140 - - 2,030 Betterment Program 1,100 1,390 - 1,650 4,140 Equipment - - 3,495 a/ - 3,495 Feasibility Study 320 390 - - 710 Unallocated 690 880 1,005 720 3,29i Total Financing 3,000 3,800 4,500 2,370 13,670 a/ Including a grant of US$300,000 for consulting services. D. Covenants of the Credit Agreement 2.11 Covenants of special significance were as follows: (a) design standards for roads' betterment should be those agreed between tne Borrower and Association; (b) the opening of an account by the Borrower in the Treasury where funds equivalent to three months' project expenditures were to be maintained; (c) maintenance by the Borrower of the primary highway system and provision of funds therefor, and provision by September each year of the 1/ The Government also undertook to finance the recurrent costs of road maintenance and betterment works not included in the project.  - 6 - proposed highway maintenance program and associated recurrent budget for the following year for the Association's comments; (d) review by the Association prior to construction of any new major highway construction proposed and its maintenance cost implications; (e) provision of suitable counterparts to work with technical assistance experts; (f) setting up of an information system (para. 4.05); and (g) the control of axle loads. 2.12 During negotiations in September 1974, the IDA allocation was increased by US$1.0 million. No major issues were raised, and the Credit was signed December 11, 1974. It became effective on June 8, 1976. The long interval was due to delay in effectiveness of the KF agreement (paras. 3.39- 3.40) and to the appointment of consultants financed under the Technical Assistance component of the project (para. 3.10), both of which were conditions of effectiveness of the project.  - 7 - III. PROJECT IMPLEMENTATION 3.01 Many problems arose during project implementation, some with serious consequences, with the result that the scope of the project had to be substan- tially reduced, elements of the technical assistance component were ineffec- tive and institutional advances were limited. Much of the difficulty stemmea from the problems the country experienced during the 1970s, which affected other Bank Group-financed projects in Mauritania as well. The following three paragraphs are intended to provide some perspective on these problems. Country Problems During Project Implementation 3.02 Mauritania experienced a severe drought in the early 197Js with drastic human and economic consequences from the resultant decline of agricul- tural production and the massive loss in the livestock herd. In 1974 economic activity was just beginning to return to normal when the very large increase in the price of petroleum products, together with increases in other import prices, put pressure on the balance of payments and set the economy on an unprecedented inflationary path. This situation was exacerbated in 1975 when stagnation of the world steel market affected Mauritania's main export, iron ore. In 1976, after Spain relinquished its control over the Spanish Sahara, the Polisario (Front for the Liberation of Spanish Sahara) waged guerilla operations against both Mauritania and Morocco which had divided the administration of the territory between them, severely straining Mauritania's already limited resources. In 1977 there was another drought, and it was necessary to import large amounts of rice and millet of which only about half was grant financed. In 1978 Mauritania experienced a coup which led to a change in Government, with temporary disruption of the administrative activ- ities. The consequences of all this were not only to fully deplete the resources Government had for development and current operations including maintenance, but to impose an additional burden on the already limited numan resources and Government administration, and further weaken the effectiveness of Government operations, including those relating to the execution of the project. Technical Assistance Prior to Project Implementation 3.03 During the years previous to the project's approval, substantial French bilateral technical assistance was provided by FAG 1/ to the highway administration. When the project was approved, there were five expatriate experts in the central highway administration and one expert attached to each of the four highway brigades and nine routine maintenance field divisions. This was an integral element in the modus operandi for the administration and supervision of maintenance activities, and implicitly one basis on which the project was formulated. However in 1973 Mauritania discontinued using the CFAF (tied to the French Franc) as its unit of currency, leaving the franco- phone association. Since that time the Mauritanian unit of currency 1/ Fonds d'Aide et de Cooperation  - 8 - has been the Ouguiya (UM). i/ For this and possibly other reasons there was some diminution of the close relations France and Mauritania had enjoyed. In the event, FAC's technical assistance to Mauritania was substantially reduced in 1974/75, leaving ME's administration and field units considerably weakened. Moreover, the French consultant, which had been engaged for the first two highway projects and had enjoyed a good working relationship with the highway administration, began to experience difficulties at about this time. 3.04 It will become apparent that the Association's technical assistance activities met with severe difficulties in these changed circumstances, which could not have been foreseen. The betterment program could only have been mounted and executed efficiently if FAC technical assistance and/or the consusltant were given substantial responsibility for supervising construction, which did not happen (para. 3.14). The consultant was only able to give limited technical assistance to the highway field divisions, and the divisions were significantly weakened and their personnel reduced by the end of the project, although not only for this reason. A. Equipment and Procurement 3.05 The Government signed the agreement for an interest free loan of Can$4.2 million with CIDA in December 1975, for the purchase of equipment and spare parts a full year after the IDA Credit Agreement was signed, due to administrative delays. In the interests of simplifying procurement procedures, a grant of Can$0.3 million was made to hire a Canadian consultant to act as purchasing agent for the Mauritanian Government, and to be responsible for the procurement of the equipment in Canada. The agreement provided that a Govern- ment representative designated to handle procurement would exercise this duty jointly with the purchasing agent in Canada. The Government and CIDA selected a Montreal consulting firm to be purchasing agent in April 1976. However, the arrangements proved ambiguous, and after considerable delay the traditional system of sending documents to Mauritania for review and approval of the Government was adopted. The National Tender Board in Mauritania authorized the invitation for bids for the equipment only in October 1976. 3.06 In February 1976 the Government sent a delegation to Canada to finalize the equipment list with CIDA. Either then, or on the occasion of a visit of a subsequent delegation, two 18T compactor/rollers were omitted from the list which had been discussed with the Association during negotiations. Canadian suppliers submitted bids in December 1976. There were further misunderstandings between Government and CIDA concerning procedures, and the contracts were signed only by the summer of 1977. The first shipment of equipment arrived in Dakar in August 1977, but was delayed two months at Rosso, the entry port of Mauritania, to c:Larify the tax situation. The CIDA agreement excluded financing of taxes; however, the customs authorities held up 1/ The UM was tied to a basket of currencies throughout the project's implementation period.  the equipment until formal authorization was obtained from Government _uthori- ties in Nouakchott. The first shipment of equipment and trucks arrived at the Central Workshop in Nouakchott in October/November 1977, about one and one-half years after project effectiveness and three years after project signature. 3.07 A supervision mission in March 1978 learned of the lack of com- pactors/rollers and strongly urged the Government to request the use of CIDA's remaining funds to purchase two compactors. CIDA agreed to the purchase of the compactors as well as Canadian spare parts to rehabilitate equipment purchased earlier under the Second Highway (Maintenance) Project. The first compactor was delivered in early 1979. In late 1979, CIDA authorized procure- ment of the second compactor, from a non-Canadian source under the provisions of the agreement which allowed 1/3 of the goods and services to be non-Canadian. Fifteen non-Canadian landrovers delivered in late 1978 were procured on the same basis. CIDA-financed procurement was completed in mid-1980. 3.08 The foregoing delayed the betterment works by about two years. The lack of the compactors on the construction sites until 1979 affected the quality of works during two construction seasons and shortened the life of those roads which had still not been completed when the project ended. Association Procurement 3.09 The procurement of goods and services financed by IDA proceeded satisfactorily although with some delays. The largest item was the contract for construction of the Kiffa-El Moundere Road (para. 3.27). B. Technical Assistance Consultants' Contract 3.10 On the basis of proposals obtained from firms short-listed during negotiations, the Government selected a joint venture of a French and Canadian consusltants in January 1975; the French consultant, in fact, had been em- ployed under the first two credits and had assisted in preparing the third. When price negotiations were held with the consultants it became apparent that the cost of the services had been underestimated. This may have reflected the increasing difficulty of doing work in the country, as the consultants price was significantly above the appraisal estimate. The Government was unable to negotiate a price within the amount of financing which had been provided for technical assistance and eventually, the scope of the services was reduced. The Government signed a technical assistance contract for a 25 month period on a tax-exempt basis in March 1976; the base cost of the contract amounted to about US$900,000, and provided for about 235 man-months in contrast with the original 350 man-months envisaged at appraisal. An amendment to Credit 519-MAU, dated July 3, 1976, provided inter alia for this change. Ministry of Equipment (ME) 3.11 The consultants commenced activities in the field in April 1976. The road maintenance experts reviewed the road system, routine and periodic road maintenance requirements, and the evolution of the road maintenance  - 10 - budget. They also prepared a plan for the execution of the road betterment program and proposed accounting procedures for it. They submitted their report, Programme d'Entretien Routier, Rapport Initial, containing specific recommendations to the Government and the Association in October 1976. The Government never commented on the report. One reason may have been the death of the Director of Infrastructure. However, some of the recommendations were approved subsequently by the Government in independent decisions at the consultants' specific request. Ministry of Planning (MOP) 3.12 The planning expert worked at the MOP from December 1, 1976 to March 1, 1978. He estimated commodity flows and the rate of return of the Nouakchott-Nema Road, recommended road transport tariffs, studied bus transport in Nouakchott and prepared a report "Passengers and Freight Transport in Mauritania" which analyzed several sector issues. MOP considered that the planning expert made a useful contribution. Mlinistry of Trade and Transportation 3.13 A management expert was assigned to the Ministry of Transportation during January-November 1977. Although terms of reference called for him to study the trucking industry, he was used by the Director of Transportation to help with the administrative details of implementing the vehicle registration system. His services were underutilized. The Consultant's Participation 3.14 While the experts produced a number of studies and reports, they were frustrated in accomplishing one of their main objectives, namely carrying out a dialogue with the authorities on their findings, and participating in the implementation of appropriate policies and procedures. Instead, the Government did not react to the consultants reports and had little communica- tion with them. In the case of ME, this was attributed to the administration's managerial and technical weakness, and an unwillingness to delegate tasks to consultants or use them to make up for managerial deficiencies; and the Govern- ment's feeling that some staff assigned by the consultants were not fully competent. The staff were later replaced for various reasons. As a result the consultants' recommendations were sometimes regarded as a test of authority and challenged; decisions were postponed and recommendations often not followed. The consultants had no authority to give instructions to improve methods of work, with consequent waste, delays and inefficiency. Often, the consultants spent their efforts in routine tasks which underutilized their skills. This state of affairs applied as well to the consultants in their role as advisers in the road betterment component (para. 3.28) and was a major contributing factor to its inefficient execution. It also applied to the training activi- ties (para. 3.15-3.19). The limited and uncertain role to which the con- sultants were consigned seems to have stenLmed largely from the situation described in paras. 3.03-3.04, as well as a general lack of understanding of now to use consultants effectively.  - 11 - Training 3.15 The project was intended to continue the training of highway mainte- nance and workshop personnel started under the Second highway (Maintenance) Project, and to extend it to foremen and supervisors, on two levels: on-the- job training of counterparts assigned to work with expatriates, and formal training conducted by a training expert. Refresher courses qe-e planned for supervisory and management personnel as were fellowships for studying anroad. In mid-1976, the consultants' training expert evaluated the highway maintenance and workshop personnel and their training needs. His recommendations were submitted to the Covernment and Association in September 1976 in the "Kapport sur la Formation du Personnel des Services Routiers." The Government did not comment on the report and most of the recommendations were ignored. 3.16 The consultants' training specialist arrived in Nouakchott early in 1977 to implement the formal training program. In the beginning, the Govern- ment failed to assign personnel to training classes. Later, it did assign some but then prematurely reassigned them to other duties. In mid-1977, tne Minister of Construction nominated 40 workmen to the training program, out in November 1977, the Government discontinued the services of the training expert after only ten months in the country, and formal training ceased. Of the 40 workmen nominated, four drivers (10%) passed the consultants' test, twenty- seven (67%) required additional training and nine (23%) left the Government within six months. The Government advised the consultants in January 1976 that it did not intend to continue the training program. 3.17 The consultants' contract had to be extended several times because of delays in implementing the betterment program. A total of 232 man-months of consultants' services were expended on the project, compared with tne 23) man-months provided for in the contract amendment (para. 3.1U). The cost of their services is discussed in para. 3.43 and their performance in para. 6.U6. The consultants' contract terminated in June 1980. 1/ 3.18 In January 1978 a Bank training specialist visited Mauritania to review the situation, summing it up in his report of April 1978 as follows: (i) there were severe organizational and managerial weaknesses within ME, with little understanding of and support for training; (ii) personnel policies, including salaries, manpower planning, and advancement opportunities were weak; (iii) little effective training had been done under the project due to poor organization, lack of managerial support, and unwillingness ot supervisors to free personnel for training; and 1/ Following the expiration of the contract, the mechanical engineers' stay in Mauritania was prolonged until July 1980, financed by French bilateral assistance (FAC), to assist in equipment maintenance.  - 12 - (iv) there was an urgent need for a long-term training program, but the shortcomings were so pervasive that short-term improvements in job performance were likely to be marginal. 3.19 Following the change in Government in July 1978, the new administra- tion appeared to have a somewhat better attitude toward training. however, at that stage of project implementation, funds were insufficient to start a major effort and formal training was not resumed. There was some on-the-job training, for example, the two mechanics provided on-the-job training for workshop personnel. The Government, which had been unable to provide counterparts initially lacking qualified personnel did so to a modest degree. For example, in 1977 the Minister of Equipment was able to name two counterparts for nine expatriate consultants. Preinvestment Study 3.20 Consultants BCEOM/Lamarre Valois were selected for the feasibility study of the Rosso-Boghe Road. After the study was underway it became evident that the Government had decided to construct the main East-West highway between Nouakchott and Nema, eliminating the main justification for improving the Rosso-Boghe road. Consequently, in January 1976 the bank recommended to Government the discontinuation of the feasibility study, since improvement of the Rosso-Boghe Road appeared premature and not commensurate with the uncer- tainty of agricultural development in the Senegal River Valley. However, despite further representations, the study was continued and the feasibility study submitted to Government in May 1976. The ultimate construction of the Rosso-Boghe Road and use of the study may hinge on the proposed construction of the Diama Dam near the mouth of the Senegal River with the assistance of bilateral funds provided through the vehicle of the Office de Mise en Valeur du Fleuve Senegal (OMVS), which is responsible for the study and execution of a broad based development plan of the river in Senegal, Mali and Mauritania. The Diama Dam would provide a large irrigation command area along the shores of the river in Senegal and in Mauritania. The Rosso-Boghe Road would inter alia provide access to the irrigated area on the Mauritania side. C. Road Betterment Program 3.21 The initial objective of the project was to reconstruct 365 km of roads, mere earthtracks without definite alignment, to laterite road standards: (i) the Atar-Choum Road (125 km); (ii) a 40 km section of the Akjoujt-Atar Road; (iii) the Boghe-Kaedi Road (100 km); and two sections of the Kaedi-Kiffa Road (100 km). It was planned that four highway brigades would carry out tne earthworks under force account, and that contractors would construct the drainage structures and bridges. 3.22 When the Government realized that the Canadian equipment would not be delivered in the early stages of project implementation, it decided, with the agreement of the Association, to regroup the equipment available for the four brigades and central workshop, and to start construction of the Atar- Sequelil and Atar-Choum sections. The Government and Association also recognized by this time that project implementation problems were increasing  - 13 - and considered that two brigades would be more likely to succeed than four. These road sections were given priority as they linked the road from Nouakchott to the railroad from the iron mining area, this road having assumed special importance in view of the guerilla warfare which began in 1976. The highway brigade at Atar was equipped in April 1977 and work commenced. The residual equipment was assigned to the second brigade on the Boghe-Kaedi Road, on which 4 work began in July 1978, but at a slow pace due to the limited amount of equipment available. When the Canadian equipment arrived, it was distributed to the two brigades and a small amount allocated to the field highway mainte- nance divisions. 3.23 In May 1977, following a guerilla attack in the northern part of the country, the consultants' chief of mission (resident engineer) judged the region unsafe and requested that they be released from supervising the Atar-Choum Road. Following negotiations between the Government and the consultants in Paris, the resident engineer was replaced and it was agreed that only volunteers would be assigned to dangerous locations. By January 1978, the middle 53 km section of the Atar-Choum Road was completed except for compaction (para. 3.06) and drainage structures (para. 3.26). At that point, the workers went on strike because of the danger from guerilla activity. Thereafter, they worked only on the Atar-Sequelil section which was completed in 1979, including compaction of most of the length, but without drainage structures. This marked the end of road construction activity under the project in the North. After November 1978, the equipment was moved from Choum to Boghe, with a small amount moved to Kiffa, which enabled the Boghe- Kaedi Road betterment to proceed at a more normal pace. 3.24 It had become evident over time that there would be insufficient funds to complete the road betterment program. Delays and other factors increased the cost substantially. Consequently, the project was amended in June 1979 to, inter alia, reduce the betterment component to a total of 215 km comapared with the original 365 km as follows: Original Amended Partially - or Fully -/ Completed Atar-Choum 125 km 50 km 54 1/ Atar-Sequelil 40 45 45 1/ Boghe-Kaedi 100 70 approx. 100 1/ Kaedi-Kiffa 100 50 50 2/ 365 215 249 The amended targets reflected the de facto status of the Atar-Choum and Atar- Sequelil roads and reductions in the length of the Boghe-Kaedi and Kaedi- M'3out-Kiffa sections. 3.25 The shortage of funds also necessitated the cancellation of the plan to construct drainage works and bridges by contractors. A supervision mission agreed with the Government in October 1977 that simple submerged bridges should be constructed by two brigades specializing in concrete drainage structures to be created by the Borrower. It was further agreed that the  - 14 - construction of three larger bridges near Kaedi and M'Bout, which would De beyond the capability of the brigades, should be cancelled after an assessment showed that these roads would still be passable during most of the year. In spite of the fact that 30 km of the Boghe-Kaedi Road which contained two of the bridge locations were cancelled (para. 3.28) the Borrower improved this section to make it passable for much of the year. This work was financed in part with local funds which the Borrower had deposited to open tne Special Account but which were not withdrawn when it was closed a short time later (para. 3.36). 3.26 A March 1978 supervision mission found that the drainage brigades had not been formed and again urged the Government to establish them. In any event, they were not established for reasorLs which are obscure. It is possible the responsible parties in the administration misunderstood the distinction between the large and small bridges and drainage works in general. Action may have become stalled as the result of the many changes and difficulties within the betterment program and the difficult economic and political climate. Moreover, the Government may not have had access to funds to create these new units. In any case, the lack of submerged bridges and of drainage facilities on the improved roads led to heavy erosion of some sections from the high run-off which occurs during the rainy season. In fact, several sections of the Atar-Sequelil Road were washed away in 1979 by an extremely severe storm, and had to be rebuilt. The proposed Fourth Highway Project would provide drainage structures on the Boghe-Kaedi and Atar-Sequelil Roads, and engineering studies for the remedial works and three large bridges near Kaedi and M'Bout. This would eventually result in the substantial completion of the betterment works as amended in Credit 519-.LAU, June 1979 (para. 3.24), except for the provision of drainage structures and recompaction on the Atar-Choum section. 3.27 In view of the lack of progress on the Kaedi-Kiffa road, it was decided in 1978 to improve a 50 km section by contractor, although the Government had at the outset objected to contracting the betterment program. A contract for a fixed sum of UM 56.2 million (US$1.26 million) was awarded in August 1979 on a tax exempt basis to a Mauritanian contractor, for the entire works. The Government agreed to provide materials ana supplies such as spare parts, fuel, and water for compaction, which were difficult to obtain. The work proceeded satisfactorily, but contract funds were exhausted after completion of 38 km. There was a delay in completing tne remaining 12 km, which was finally done when arrangements were made to utilize the remaining Association funds. They were disbursed on an IDA 80% - KF 2U% ratio, compared with the 44/56 ratio (para. 2.08), at an additional cost of US$600,UUO. The work, which was completed by the end of 1980, is satisfactory. Quality of the Betterment Works 3.28 The Credit Agreement did not provide for the consultants to manage the betterment works and the Borrower did not generally follow the consultant's advice (para. 3.14). This, as well as the initial lack of compaction equip- ment, resulted in a number of deficiencies, i.e.: (i) materials were often not properly selected; (ii) the volume of water used was insufficient for optimum  - 15 - compaction; (iii) there was a lack of geotechnical control; and (iv) the volume of work was generally low, peaking at about 20-30,000 m3 per month. Production was hampered by: (i) lack of key equipment due to breakdowns; (ii) slow repair works; (iii) inexperience of operators; (iv) lack of funds (petty cash, special account); and (v) inadequate supervision and planning. The amended targets for road betterment were partially met by force account, and partly by contractor (para. 3.24). However, the force account sections were not provided with drainage structures, and one road section was not compacted. Lacking drainage structures, sections of these roads eroded or washed away, and become impassable, and will remain so until such damaged sections are rebuilt (para. 3.26). 3.29 After the change of Government in 1978, the Borrower made a greater effort to address the problems and to improve the quality of works. It was at this juncture that CIDA authorized the purchase of two compactors, and agreed to rent a compactor in the meantime. The Borrower gave some heed to the consultants' advice and in September 1978, the Government appointed a Project Director. Generally, execution of betterment works appeared to go ahead somewhat better after mid-1978, but with many of the chronic diffi- culties continuing. D. Maintenance of Roads 3.30 Under the project the Government undertook the general obligation to maintain the road network (para. 2.11). The highway experts (para. 2.05) were to assist in reorganizing the field subdivisions for highway maintenance, training the personnel, and programming and supervising their activities. The project also included CIDA purchase of some highway equipment for maintenance. 3.31 The improved road network increased from 1,500 km in 1970 to 2,800 km in 1980, due mainly to the construction with Arab agency funds of the 1,200 km paved Nouakchott-Nema Road. As desert roads need regular systematic mainte- nance to avoid deterioration this substantially increased the demand for road maintenance. 3.32 The road maintenance expenditures (Fonds Routier) exclusive of personnel costs (para. 2.11) were as follows: -------------------US$ Millions Equivalent------------------ 1973 1974 1975 1976 1977 1978 1979 1980 1.39 1.72 1.73 1.76 1.67 1.79 2.2 1.45 In real terms the funds allocated to road maintenance diminished over time, and insufficient funds were budgeted to maintain the network. Moreover, the Government found it necessary in view of its lack of funds to switch a significant portion of the budget allocations in 1977, 1978 and 1979 from maintenance to the road betterment program.  - 16 - 3.33 By 1977/78 the Government could not afford to pay salaries to the maintenance personnel due to Mauritania's severe economic and political difficulties. There was considerable attrition in the number of workmen and in 1978 routine maintenance practically came to a halt. The four brigades had been financed under the Second Highway (Maintenance) Project in 1971/72, experienced similar difficulties. By 1976 the equipment fleet needed rehaDil- itation and renewal. However, the Government had been decreasing the funds available for the brigades and the funds provided that year were insufficient to do the program, although the Rosso-Nouakchott Road, a main traffic artery, was fairly well kept up. 3.34 The highway divisions went through several reorganizations, includ- ing increases and decreases in the number of divisions, to no avail. The only equipment they received from CIDA was a few landrovers. The project contribu- tion to maintenance was very small in the face of the limited assistance specified in the project, the severe budget and administrative difficulties, and the disruption of FAC technical assistance (para. 3.03 and 3.04). E. Other Aspects of Project Implementation 3.35 The Borrower had undertaken to open a Special Account in the Treasury, with an initial deposit sufficient to finance project expenditures for three months, which was to be periodically replenished from the Credit Account. A second account, in a commercial bank, credited with funds withdrawn from the Special Account, was to be opened to cover small expenditures under the project. 3.36 The commercial bank account was never opened. Despite frequent requests the Government did not open the Special Account until December 6, 1977, US$450,000 equivalent being deposited December 29. However, on December 31, 1977, two days later, the Government enacted a new law eliminating all such special accounts in the Treasury, said to number 200-300 and to account for 2/3 of the budget, in compliance with the request of the IMF in the interests of stabilizing Mauritania's economy. 3.37 Subsequently the Special Account was replaced by a line item in the national budget, reimbursements from the Association and KF being deposited in the General Treasury. The Minister of Finance emphasized that such pay- ments were reimbursements for work prefinanced by the Government, and that it could not guarantee they would be used for project purposes. In fact, this system continued to be used only for payment of salaries and other direct expenses paid by the Borrower. The Special Account provision of the Credit Agreement was waived by the Association and new payment procedures, including direct disbursement to the supplier/contractor by the Association, were later adopted. The Association's Posture 3.38 As time progressed, concern grew within the Association as to where the Project was headed. Towards the end of 1977, it became evident the Project could at best meet only some of the original objectives and that it  - 17 - either should be reduced in scope to reflect the realities, or be termi-ated. The Association and KF agreed to the former course at the 1978 Annual Bank/Fund meetings. The Credit was amended in June 1979 (para. 3.24) to reduce the size of the betterment program and to drop the provisions for the Special Account and iellowships. Concurrent with this, the Project was exempted from taxes and duties, eliminating the Government's contribution. Co-donors 3.39 The Government and project experienced some difficulties in conjunc- tion with the co-donors. The most important were the long delay in procurement of CIDA-financed highway equipment (para. 3.05-3.08) and failure to provide compactors at the outset. The overlong delay in effectiveness of the Credit (para. 2.12) was attributable in part to a misunderstanding between the Association and KF concerning the inclusion in the project, subsequent to Credit approval, of the overrun on the Second Highway (Maintenance) Project (para. 1.05). The need for overrun financing was addressed in August 1975. In answer to the Government's request the Association advised the Government it should seek KF's approval to include the overrun of $195,000 in the project, since the Association and KF were jointly financing their share of the project. The Government was unable to obtain KF approval on the grounds that this element was not part of the package on which joint financing was based, and was an Association concern. To resolve the issue the Association agreed in March 1976 to employ part of the Association's unallocated category for the purpose. The Credit Agreement was amended in August 1976 to, inter alia, create a second technical assistance category of US$195,000 (reduced to US$175,000 in the June 1979 amendment). Inasmuch as KF did not make its loan effective until this was settled, the Association was unable to make the Credit effective until June 1976 in view of the KF cross-effectiveness condi- tion. The delay in the signing of the consultants' technical assistance contract (para. 3.00) would in any case have delayed effectiveness until March 1976. 3.40 The delay in reaching agreement on the June 1979 amendment, and on taking other steps to improve project implementation, must be partly ascribed to the need to first reach a common understanding among an inefficient Govern- ment administration, the codonors, and the Association. Compliance with Credit Covenants 3.41 The Borrower was unable to fulfill most of the important covenants (para. 2.11): (i) the provision of a special account in the treasury was eventually waived; (ii) the highways system was not adequately maintained, budgets for the purpose were inadequate and only a portion of the funds allocated under them were made available; (iii) information on proposed major highway construction was provided to the Association but its views were not ful:Ly considered; (iv) it was not possible for the Government to provide counterparts through most of the project. The standard covenant concerning efficient execution of the project was not met.  - 18 - Project Cost 3.42 Actual total project cost was ascertained to be US$12.04 million, including taxes. However, the scope of the project was greatly reduced, and the actual cost is not comparable with the appraisal estimate of US$13.7 million. The main reductions were: (i) the technical assistance actually provided amounted to 232 man-months against the original 330 man-months, and (ii) the betterment program actually carried out comprised about 249 Km vs 365 km originally planned; drainage systems were provided for only 20X of the total; and bridges were not built. The estimated and actual costs given in Table I, do indicate some differences but show mainly that the full amounts provided by the co-donors were expended, if on a smaller project. It is not possible to estimate the size of the cost overrun because the cost of bridges and other works required to complete the betterment program are not known. Disbursements 3.43 The Government was slow to transmit disbursement requests for direct payments and, in general, the pace of disbursements was slow, well behind appraisal estimates, until the end of the project. Only 66% of the funds had been disbursed by mid-1980, when, according to the appraisal estimate, the Credit should have been fully disbursed (Table III). At December 15, 1981 about 98% had been disbursed (Table III). The project was "completed" at about the end of 1980; however, the closing date of the Credit was extended to December 31, 1981, to enable disbursements to be completed. Credit Amendments 3.44 The Credit Agreement was amended twice: on July 3, 1976 to reduce the technical assistance component from 350 to 200 man-months (para. 3.10), provide US$195,000 in retroactive financing for the First highway Project (para. 3.39), and extend the completion date to December 31, 1980 and tne closing date to June 30, 1981; and again on May 31, 1979 to reduce the Detter- ment works from 365 to 215 km, exempt the project from taxes, and provide for 100% financing by external donors (the Association and the Kuwait Fund) (para. 3.24).  - 19 - IV. INSTITUTIONAL DEVELOPMENT 4.0.1 The project provided for a broad program of institutional develop- ment. While the experts provided for this purpose carried out a number ot studies there was little response to them from Government, except in the Ministry of Plan, and their overall impact was small (paras. 3.11-3.13). Tne training program experienced a similar fate, and the actual training done was quite limited (paras. 3.15-3.17). It became evident that institutional shortcomings were so pervasive that short-term training efforts were likeiy to have only marginal value. 4.02 This unsatisfactory experience appears to have stemmed from: (i) Government's preoccupation with the continuing grave country difficulties; (ii) limited ability of Government institutions to comprehend, absorb and utilize institution development activities; and (iii) the relatively poor relationship between Government and the consultants may also have contributed (paras. 3.03-3.04).  - 20 - V. ECONOMIC REEVALUATION 5.01 It is not possible to re-evaluate the economic return in a meaningful way because the roads were not completed, and will deteriorate rapidly without further intervention. Moreover, the presenat level of traffic on these roads is uncertain. The only available traffic counts are as follows: Date of Vehicles Percent heavy Road Sections Count per Day Vehicles North (Akjoujt-Atar-Choum) 10/72 40 28 South (Boghe-Kaedi-Kiffa) 1/74 24 83 The traffic count in the North was consistent with the appraisal estimate of 50 v.p.d. in 1974; however, the count in the South, made some months after project appraisal, was substantially lower than the appraisal estimate of 75 v.p.d. in 1974. Traffic patterns since these counts were taken have been erratic. In particular, military traffic :Ln the North has been unusually high due to the Polisario conflict; agricultura:L traffic in the South has grown slowly because of repeated droughts; and other traffic may have remained low because of Mauritania's economic difficulties. It is reported that most traffic in the South presentiy travels on the paved road on the Senegalese side of the river (see map), with the vehicles remaining in Senegal. The extent of this traffic is not known. 5.02 Betterment works of the type financed by the project would normally have a service life of about eight years. This is expected to be the case for the Kiffa El-Moundere section, which was properly constructed by the contrac- tor. However, there is considerable uncertainty over the serviceability and economic life of those road sections which were not provided with drainage and in one section, Atar-Choum, not compacted. The Boghe-Kaedi section, located in the South, is subject to heavy rainfall every year. The Atar-Choum and Atar-Akjoujt sections, located in the North, are subject to less frequent but nonetheless intense rainfall. The roads were in fact damaged during the 1979 and 1980 rainy seasons. It is therefore likely that to keep them in serviceable condition, major interventions will be required on these roads within about two years after they were partly constructed. The proposed Fourth Highway Project would finance the most urgent drainage structures, and include a feasibility study for the bridges and remedial works required to complete these two roads. 5.03 The roads which were partly constructed under the project perform important economic functions. The northern sections extend the country's main north-south road to the railhead at Choum. The southern sections form part of the main east-west road serving the Senegal River Valley, the agriculturally most productive area of the country. However, the economic return for the roads will be negative if they are not completed, based on a calculation of vehicle operating cost savings, even if rather optimistic traffic levels are assumed. 1/ This would be the case if the roads' service life is taken as two years, and traffic levels are assumed as follows:  - 21 - a) 1981 traffic in the North is 60 v.p.d. having grown 5% p.a. since it was counted in 1972; b) 1981 traffic in the South is 45 v.p.d., having grown 10% p.a. since it was counted in 1974, due to agricultural development; c) future traffic grows 10% p.a. as the economy recovers. 5.04 The rate of return from the completed Kiffa-El Moundere section in the South, which is expected to serve about eight years, would be about 13% assuming the above traffic levels and vehicle operating costs savings. This rate of return would have been more representative of the project as a whole if the roads had been completed. 5.05 The highway system was not adequately maintained during the project implementation period (para. 3.34), and the benefits from this element of the project were inconsequential. The overall rate of return from the project is therefor estimated to be negative assuming the roads are not completed. This compares with rates of return estimated at the time of appraisal, which were 16% for betterment works in the North, and 35% for those in the South. 5.06 The disparity between the expected and actual rates of return on the Kiffa-El Moundere section, putting aside the hypothetical nature of the traffic growth assumed, reflects the lower traffic than estimated at appraisal and the larger per kilometer construction cost, due to the delay in implemen- tation coupled with inflation, and the higher cost of contracting this section than doing it by force account. 1/ Vehicle operating costs used in the calculation were estimated by the Ministry of Plan in 1977 with technical assistance provided under the project as follows: Vehicle Operating Costs on Gravel/Earth Roads (UM/vkm at 1977) Excellent Poor Vehicle Condition Condition Car 6.5 10.6 12-ton truck 26.5 51.7 Bus (26 seats) 15.7 23.2  - 22 - VI. PERFORMANCE OF THE GOVERNMENT, ASSOCIATION AND CONSULTANTS AND CONCLUSIONS Government's Performance 6.01 The response of Government and institutions concerned with the project was often inadequate. With the pervasive country problems that beset the Government's administrative apparatus, it was difficult for it to give priority to project problems. After allowance for this, the fact remains that Government performance could have been improved upon throughout, as it did somewhat in the later stages of the project. The reasons for the foregoing are given in the section on institutional development (paras. 4.01-4.02). Association's Performance 6.02 On the basis of the record of the highway sector in Mauritania, there was little evidence to suggest that a major civil works road project, including 365 km of widely scattered betterment works, could be done by force account. Force account is usually associated with maintenance activities or works carried out by organizations with some record of sound organization, adequate management and reasonable accomplishment, which was not the case here. While the Government was against contracting civil works, it would seem that the Association might have made the issue of contracting vs force account a major consideration. The difference in results between force account work and of the 50 km Kiffa section done by domestic contractors provides ex-post evidence. Whether the consultants could have got the force account job done successfully if it had been given management responsibility is a matter of conjecture. Had the full FAC team remained in Mauritania, working in conjunc- tion with Government and the consultants, force account might conceivably have worked out. 6.03 On the institution-building side, supervision and other missions addressed the many problems in a reasonably direct and thorough manner. But Government was so often unresponsive as to make supervision for this purpose largely ineffective. While the Government was the source of this difficulty, it was also true that the Government did not have the capability to deal with the problems. For this reason, the project's technical assistance and related institutional-building elements appear altogether too ambitious and unrealistic. In retrospect, the Association's approach to institution building should have been on a simpler plane, with more modest objectives. 6.04 The Association was helpful to the Government in readily responding to the need to amend the Credit Agreement and project content to reflect changing conditions, although efforts were slowed by the need to cordinate changes with the codonors (para. 3.10). The frequency of supervision missions was generally adequate, but the extensive efforts made by the Association to assist the Government with its procurement problems may have reduced the time missions could spend on field works. However, there is little in the record to suggest that increased supervision would have significantly affected the outcome.  - 23 - 6.05 Whether, in 1977, the Association should have sought to terminate the project when it became apparent that, at best, the project could only be partially completed, and this with continuing difficulty, is a question. The Association was devoting a large amount of time and effort to.a question- able cause, and it was becoming increasingly unlikely that the country was going to obtain adequate benefit from the project. 6.06 Finally the engineering studies which were carried out for the Boghe-Kaedi road prior to project appraisal did not provide an adequate basis for estimating the cost of the bridges required to be constructed near Kaedi, due in part to the changing regime of the river. If the Association had insisted on more complete investigation prior to apraisal some of the subse- quent uncertainties over how best to complete the works could have been avoided. Consultants Performance 6.07 The consultants' success was at best modest, and there is some temptation to blame them, in part, for the poor infrastructure results and the lack of success in the technical assistance efforts. It would probably be an error to do so. While they were reluctant to continue in the North when guerilla activity became dangerous, this is understandable. In the latter stages of the project, they tended to employ less experienced staff, but this should be considered in the light of the reception the perhaps more experienced staff had been receiving. In the TA aspect, it was evident that regardless of what the consultants provided, Government was occupied with other things and the possible fruits of TA withered. The infrastructure situation is more complex. It is clear that the consultants were not given the job of managing the road betterment program but of advising on it. It is also manifest that the consultants leverage with the authorities and the supervisory staff directing force account activities was, in contrast with the past, small, presumably because of the changed relationship between the Government and FAC (paras. 3.03-3.04). Conclusions 6.08 The project was at best partially successful. Only about 50% of the originally planned infrastructure, or about 60% of the amended infrastructure program, was done. But some of it may not endure. The technical assistance provided for institutional development, and studies related thereto, were of limited effectiveness in meeting objectives. 6.09 The difficulties with the infrastructure components stemmed in the first instance from the use of force account, rather than a contractor, to do the work. The Mauritanians did not have a force account establishment capable of a job of the magnitude involved, particularly in view of the withdrawal of FAC technicians, and the Government's unwillingness or lack of understanding on how to use consultants to manage projects. In any case, the host of major country problems which beset the Government during the implemen- tation period, its institutional weaknesses and lack of financial resources  - 24 - would have made the implementation of any project very difficult. Finally, the involvement of co-donors coupled with an inefficient Government administration, made it more difficult for the Administrat:Lon to identify and respond quickly to project implementation problems when they arose. 6.10 A Fourth Highway Project for the purpose of completing the amended betterment program and reviewing road maintenance strategy was negotiated in December 1981. The lessons learned in the Third Highway Project are being taken into account. The civil works will be done by contractor, and institu- tional objectives are modest.  PROJECT COMPLETION FEPORT MAURITANIA THIRD HIGHWAY PROJECT (CREDIT 519-MAU) Cost Estimates by Source of Finance (Including Taxes and Contingencies, US$ Millions) AT At OtA15AL- T1?1TATZD MAL' l.t1 .d P.-tU9 Proj~~1 It.. I-~~~4t~ 1. lTDA I APOMSAL . f401.1O 0 -Ok 07 l.t. A4tt1 lDi S U7 = 2 tlDA t t... ! lot- _ Ilk _S 07 t CIDA S boI. ? CD tOTAL dt1l0-11o ot.0.0d 1. .ocvoleu1 A..1.- UC10I 4/IS 1.05 44 1.15 54 0.40 4.40 44 1.16 04 1.D6 *S 1.0~~~~~~~~~~~~~~~~~4 .5 3 C. 7 5,-MA 0.1U 100 0.18 - 3. ?t .-i. LV 11/77 0.35 44 0.4 5' 0.a0 0.50 44 0.64 54 1.14 100 4. Ct,U bj -s ltt 1/0 1.44 24 2.U 14 1.40 40 -6.DD 1.42 5 2.14 51 4.0 15 .. 50 10,0 P r-g A3) Iis 3. Lq.LpOOt CD1 4.30 100 4.34 4*50 200 4.30 100 tOtAL 00St 2.44 21 3.84 19 4.30 32 2.40 1s 13.70 5.00 23 1.94 33 4.50 3? 0.60 .2.04 1/ At 010.4.A r.t. 001.00, W s0. 2/ At *_kj ..w US I.00 CHW 45. t-4  - 26 - TABLE 2 PROJECT COMPLETION REPORT MAURITANIA THIRD HIGHWAY PROJECT (CREDIT 519-MAU) Project Cost Estimates (Including Taxes, US Millions) :