Madagascar - Antananarivo Water and Sanitation Project

Document of The World Bank FOR OFFICIAL USE ON4LY Report No. 8091 PROJECT COMPLETION REPORT MADAGASCAR WATER AND SANITATION PROJECT (CREDIT 1002-MAG) SEPTEMBER 28, 1989 Infrastructure Operations Division South-Central and Indian Ocean Department Africa Regional Office This document has a restricted distribution and may be used by recipients only in the perfonnance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  THE WORLD BANK FOR OMCIL USE ONLY Washington. DC 20433 U-SA. Offie o offvinhuoasw September 28, 1989 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on Madagascar Water and Sanitation Proiect (Credit 1002-MAG) Attached, for information, is a copy of a report entitled "Project Completion Report on Madagascar - Water and Sanitation Project (Credit 1002- MAG)* prepared by the Africa Regional Office with Part II of the report contributed by the Borrower. No audit of this project has been made by the Operations Evaluation Department. Attachment Tbhis dbumnth asaruuie disbutf and may be NW by bWeits aidy inte W(fam of their olikb dutba ItIl Cotnls maY M0 otheewi be dliwiod witou Wald 0ink *ull_dm  PROJECT COMPLETION REPORT MADAGASCAR WATER AND SANITATION PROJECT (CREDIT 1002-MAG) TABLE 0F CONTENTS Page No. PREFACE . ...................................................... i EVALUATION SUMMARY ............................................ ii PART I I. INTRODUCTION ................................... . 1 II. PROJECT PREPARATION AND APPRAISAL ....................... 1 Project Background ..................... 1 Identification ......................... 1 Preparation .......................... 2 Appraisal ................................... 2 Negotiations and Approval ...... ............. . 3 M4ajor Objectives of the Project ..... ............ . 3 Project Description ................. .. .............. 4 III. IMPLEMENTATION .......................... 4 Effectiveness ......................... 4 Project Management ....... ............... . 4 A. Major Revisions ................................. 4 B. Implementation Schedule ......................... 5 C. Procurement .5 D. Costs ........................................... 6 E. Disbursements ................................... 7 F. Performance of Consultants and Contractors ...... 7 G. Reporting ....................................... 7 IV. INSTITUTIONAL, FINANCIAL AND ECONOMIC PERFORMANCE ....... 7 A. Institutional Aspects ........................... 7 B. Financial Performance ........................... 8 C. Economic Justification .......................... 10 V. THE ROLE OF IDA ...................... ................... 10 VI. CONCLUSIONS ............................................. 11 PART II A. WATER SUPPLY ........... .................................... 12 I. INTRODUCTION ........................................ 13 II. PROJECT IDENTIFICATION, PREPARATION AND APPRAISAL ... 14 III. EXECUTION ........................................... 19 IV. OPERATING RESULTS ................................... 22 V. FINANCIAL BALANCE SHEET ............................. 23 VI. ROLE AND DEVELOPMENT OF INSTITUTIONS .... ............ 24 Thisdocument has a restricted distribution and may be used by recipients only in the performance of theirofficial duties. Its contents may not otherwise be disclosed without World Bank authorization.  TABLE OF CONTENTS (Cont.) Page No. B. DRAINAGE AND SEWERAGE ................. ..................... 27 Report on Sanitation in Antananarivo . .................... 29 C. SOLID WASTES ............................ ...... 45 I. INTRODUCTION . ................................. 4, II. PROJECT IDENTIFICATION, PREPARATION ANr APPRAISAL ... 48 III. EXECUTION ........................................... 48 PART III KEY PROJECT DATA..52 KEY ROJCT ATA............................................... 5 CUMULATIVE DISBURSEMENTS ....... ................................ 52 OTHER PROJECT DATA . ............................................. 52 MISSION DATA .......... 53 EXCHANGE RATES . ................................................. 53 PROJECT COSTS . ................................................. 54 PROJECT FINANCING .............................................. 55 JIRAMA BALANCE SHEET ......... .................................. 56 JIRAMA INCOME STATEMENT ........................................ 57 SOURCES AND APPLICATION OF FUNDS STATEMENT ............... ...... 58 FINANCIAL INDICATORS ........ ................................... 59 ECONOMIC PERFORMANCE ........ ................................... 60 CHARTS  i PROJECT COMPLETION REPORT MADAGASCAR WATER AND SANITATION PROJECT (CREDIT 1002-MAG) PPEFACE This ic the P:oject Completion Report (PCR) for the Water and Sanitation Project in Madagascar, for which credit 1002-MAG in the amount of USS 20.5 million was approved on April 1 1980. The Credit was closed on June 30, 1986, one year behind schedule. Seven million were cancelled on June 30, 1985, the remaining amount, US$ 13.5 million, was fully disbursed and the last disbursement was on November 4, 1986. The PCR was jointly prepared by the Infrastructure Operations Division of the South-Central and Indian Ocean Department, Africa Regional Office (Preface, Evaluation Summary, Parts I and III), and the Borrower (Part II). Preparation of this PCR was started during the Bank's final supervision mission of the project in December 1986, and is based, inter alia, on the Staff Appraisal Report; the Credit and Project Agreements; supervision Reports; correspondence between the Bank and the Borrower; and internal Bank memoranda.  ii PROJECT COMPLETION REPORT i MADAGASCAR WATER AND SANITATION PROJECT (CREDIT 1002-MAG) EVALUATION SUMMARY Obiectives 1. The project's major objetives were: (i) to improve and develop the existing water supply, sewerage, drainage and solid waste facilities in the Antananarivo area; (Li) to strengthen the relevant institutions to attain proper standards of operation and maintenance; (iii) to assist the Government in developing appropriate cost recovery policies; and (iv) to help the Government prepare a long-term development program for urban water supply (para.2.08). Implementation Exuerience 2. The wate.r supply component was implemented by JIRAMA, the national water and electricity company. On the technical side, its performance was very good: they prepared final design with their own staff, as well as the bid documents, and supervised the works satisfactorily. As regards the institution, the project played an important role in convincing JIRAMA to to implement a major reorganization and to reduce its staff (para.4.01). 3. On tbh financial side, the project was successful in addrcssing deficiencies in tariff policy and financial management. Although tb4 tariffs are not yet sufficient, no decision would have been obtained without the strong pressure exerted by IDA (para.5.02). 4. The Ministry of Public Works was responsible for implementation of the sewerage and drainage component of the project. Major difficulties oce.ured with the preparation of the final design and bid documents. It had been agreed that the Ministry would carry out the studies with its own staff but, later on, they requested IDA to finance a contract with a local consulting firm. IDA agreed but the performance of this consultant led to its replacement by JIRAMA, with IDA's concurrence. At that time, implementation was about two years and a half behind schedule (para.3.03). 5. In addition to the bad quality of the bid documents, the Ministry issued the invitation to bid without awaiting the IDA comments and approval. IDA required that the bidding process be stopped imediately and seven US$ million were cancelled on June 30, 1985 (para.3.05). 6. The rehabilitation of water and electricity facilities damaged by Cyclone Kamisy in April 1984 (US$ 2.9 million) was implemented by JIRAMA very efficiently (para.3.07). 7. Project completion took one year and a half more than foreseen in the appraisal schedule. nonetheless, the project completion time compares favorably with Bank water supply projects averages and with other Bank projects in East Africa (para.3.08).  il Results 8. On the water supply side, the project was successful in addressing deficiencies in water availability, tariff policy and financial management. As regards drainage and sewerage, the studies carried out under the project were used for the preparation of the Tana Plain Development Project which was appraised in July 1989 (para.6.01). Findinis and Lessons Learned 9. The main lessons to be learned are the necessity to have the final design available at appraisal, for at least a part of the project, and not to accept the recruitment of local consultat.ts if their experience and competence are not clearly established (para.6.02).  MADAGASCAR WATER AND SANITATION PROJECT Credit 1002-MAG Prolect Completira Report Part I: Project Review '&rom Bank's Perspective  REPUBLIC OF MADAGASCAR WATER AND SANITATION PROJECT (CREDIT 1002-MAG) PROJECT COMPLETION REPORT I. INTRODUCTION 1.01 Madagascar's population at the time of project identification in early 1977 was about 8 million, with an average density of approximately 14 inhabitants per km2. The population growth rate, at 2.52 per year, was average for the region. About 82X of the population was scattered in rural areas. The urban population, located in towns of more than 2,000 inhabitants, represented about 182 of the total population. Its rate of growth was around 6% p.a., and Antananarivo, the capital city, was by far the largest center in the country with more than 600,000 people. Its population has now reached 800,000 inhabitants, 1 million when the suburbs are included. 1.02 The principal institutions in the water and sanitation sector are the Ministry of Public Works, for sanitation, the Ministry of Industry and Energy, for water supply, and the Ministry of Health for both sanitation and water. The Antarianarivo Municipality is responsible for water supply, sanitation and garbage collection and disposal. The Municipality was unable to carry out its responsibilities because of insufficient human and financial resources. In 1976, JIRAMA (Jiro sy Rano Malagasy, which means Electricity and Water of Madagascar) was established as a totally goverrment-owned enterprise to operate power and water facilities throughout the country. It took over the operations of a private company (Electricite et Eau de Madagarcar, EEM) which had been nationalized earlier. Although EEM had a contract with the Municipality until December 1979, JIRAMA was established without the Aunicipality's concurrence, and this had bad consequences with respect to the payment of water charges by the Municipality. Under the framework of the International Decade of Water and Sanitation, a National Water snd Sanitation Committee, chaired by the General Director of Planning, has been established to assume a coordinating role. 11. PROJECT PREPARATION AND APPRAISAL Proiect Background 2.01 The Water and Sanitation Project was the first project financed by IDA in Madagascar for the water and sanitation sector. From 1971 to 1975, UNDP (with WHO as executing agency) financed a master plan and feasibility studies for the water supply and sewerage sector in Antananarivo. The studies, carried out by a foreign consulting firm, included an urban water and sanitation sector study for the whole country. At the time, a number of Bank missions to Antananarivo helped influence the direction of the studies. Identification 2.02 In December 1976, the Government formally requested that the Bank Include the Antananarivo Water and Sanitation Project in its lending  2 program. In February 1977, a Bank mission initiated discussions with the Government on the preparation of this project. It was agreed that it would be the first stage of the project designed by the UNDP financed studies (see para 2.01). The project had four physical components. The water supply component would meet the water demand up until 1986, with a service level of 60X of the population. The drainage component would reduce the frequency of floods in the low areas of the city caused by rainstorms and would substantially reduce the risk of city floods caused by intruding water. The sewerage component, although modest in size, would complete the sewerage facilities in the densely populated quarters of the city center where the situation was most critical. The solid waste component would improve the conditions of refuse collection and disposal arrangements. Preparation 2.03 In April and December 1977, an IDA mission completed the identification and initiated the preparation of the project. It was agreed that detailed engineering studies and supervision of works would be carried out by JIRAMA for the water supply component and by the Ministry of Public Works for the drainage, sewerage and solid waste components. The mission was asked to include a flood control component in the project, composed of several hydraulic works and an erosion control program in the catchments of the Ikopa River and its subsidiaries. Since these works were not supported by any feasibility study, the mission proposed that consideration be given to the financing of a global study which would first review all the ideas and studies already done on this subject, and justify among several alternatives which hydraulic works had to be constructed to protect the city against a 50-year flood cycle and prevent the yearly flooding of the surrounding ricefields which precluded the harvesting of two crops per year. Finally, it was agreed at appraisal that this sttudy would not be included in the project but would be financed by an engineering credit (Credit 1086-MAG, of SDR 1.8 million, signed on January 30, 1980), for which the agriculture division was responsible. Appraisal 2.04 The project was appraised in July 1973 by two IDA staff members. The Issues Meeting, held on August 21, 1978, discussed and reached conclusions on the following: (i) Financing Plan: the IDA Credit of US$ 15.0 million would finance only 522 of the total project cost of US$ 29.0 million, the meeting proposed to request the Government to seek co-financing from other external :-nders; (ii) Water Tariffs: aecording to the appraisal estimates, the water tariffs had to be doubled ovar the construction period in order to achieve a satisfactory rate of return. This could only be done in steps. The meeting recommended that the first step be a condition of Board presentation, rather than a condition of effectiveness; (iii) Tax resources: since only the Government had the authority to raise taxes, the meeting wanted to have confirmation that future allocations to the Sanitation Department of the Municipality would  3 be sufficient to meet the needs of that department for proper operation and maintenance of the facilities; (iv) Relending Terms: the meeting recommended to request clarification from the Government, since under previous projects assistance to municipalities had been done on a grant basis. 2.05 During a mission to discuss the Economic Report, in June 1979, it was said that the Government was ready to reject this project because of the Bank's tough conditions. Another Programs' mission, in December 1979, concluded that the only remaining issues would be the water tariffs and cost recovery for the Sanitation Department of the Municipality. Negotiations and Approval 2.06 Negotiations were held in Washington from December 10 through 14, 1979. The Malagasy delegation requested IDA to increase its contribution from US$ 17.5 to US$20.5 million since, due to the delays and new estimates of international and domestic inflation, the project cost had reached USS 33.7 muillion. By telex dated January 14, 1980, IDA agreed on a Credit amount of USS 20.5 million. Water tariffs were increased by 12% in January 1980. During negotiations, JIRAMA informed IDA that it had been engaged in operations which were not directly related to its public utility services, i.e., the manufacture of water meters and electrical home appliances. It was agreed that JIRAMA would limit its activities to public utility operations and before December 31, 1980, transfer to a separate entity the assets and obligations not related to public utility operations. It was also agreed, on Government's request, to extend from 30 to 35 years, including 5 years of grace, the repayment period for funds onlent to the Municipality. 2.07 The Credit was approved on April 1. 1980 and signed on May 8, 1980. Maior Obiectives of the Proiect 2.08 The major project objectives were: (a) to improve and develop the existing water supply, sewerage,drainage and solid waste facilities in the Antananarivo area; (b) to strengthen the relevant institutions to attain proper standards of operation and maintenance; (c) to assist the Government in developing appropriate cost recovery policies; and (d) to help the Government prepare a long-term development program for urban water supply.  4 Proiect Description 2.09 The project consisted of four physical components: (a) water supply, production and distribution; (b) drainage, collectors, storage basins, river dykes and a pumping station; (c) sewerage, collectors, pumping station and a pilot stabilization pond; and (d) solid waste, construction of 560 dumping containers, supply of 19 collection trucks, equipment to properly operate the existing landfill and improvement of the existing composting plant. 2.10 The project also included training for JIRAMA water supply staff and sanitation staff at the Municipality of Antanararivo, with the financing of 302 of the extension of the JIRAMA training center and a contribution to the cost of training abroad and locally. IIIW *HPLENENTATION Effectiveness 3.01 The initial date of effectiveness was October 8, 1980. It was twice postponed, to November 30, 1980, then to January 30, 1981. The only conditions of effectiveness were the signing of the subsidiary loan agreements between, on one side, the Government and, on the other side, the Municipality of Antananarivo and JIRAMA. The Credit was declared effective on December 17, 1980. Proiect Management 3.02 There were three executing agencies: (i) JIRAMA for the water supply component; (ii) the Ministry of Public Works for the drainage and sewerage component; and (iii) the Fivondronana (mt'nicipality) for the solid waste component. In order to assure good coordination between these agencies, the Government proposed that a staff of the General Directorate of Planning be appointed as Project Coordinator. IDA agreed but this solution proved to be very disappointing (para 3.14). A. Nalor Revisions Drainage and Sewerage Component 3.03 The major project revisions were due to the delays in carrying out the final design and the preparation of bidding documents for the drainage and sewerage components. It had been agreed that the Ministry of Public Works, the executing agency for these components, would carry out the studies with its own staff. Later on, they requested IDA to finance a contract with a local consulting firm. IDA agreed, but at the end of 1980  5 the performance of the consultant selected by the Ministry (SECMO) led to its replacement by JIRAMA in January 1982, with IDA's concurrence. At that time, implementation was about two years and a half behind schedule. 3.04 Since JIRAMA had no experience in drainage or sewerage, it selected,as sub-contractor, the foreign firm which had carried out the master plan and the feasibility studies for UNDP. Ic was a good choice, but this firm was only a sub-contractor, with no direct access to the Ministry. Bid documents were finalized by the Ministry and sent to IDA on August 28, 1984, without any drawing. IDA replied by telox, dated September 13, requesting to postpone the bidding process until IDA received the drawings and camment on the bid documents. 3.05 However, the bidding documents were issued on September 15, as scheduled. Because of this mis?rocurement, IDA required that the bidding process be stopped immediately, and proposed to cancel part of the Credit 1002-MAG and to prepare a new project, which would include the sanitation component of the present project and the flood control project studied by the Credit 1086-MAG. Seven million US dollars were cancelled on June 30, 1985. 3.06 During a mission, in December 1984, it was agreed to extend the closing date from June 30, 1985, to June 30, 1986, and to finance additional sanitation equipment for the Fivondronana and a program of urgent works, mainly rehabilitation of existing sewers and rehabilitation study for existing pumping stations (Isotry and 67 Ha), in order to eliminate adverse sauitary conditions within low-lying areas of the city. Cyclone Rehabilitation Prolect 3.07 On April 9 and 11, 1984, the regions of Antsiranana (Diego-Suarez) and Mahajanga were severely damaged by Cyclone Kamisy. An appraisal mission, in May 1984, proposed to finance rehabilitation of water and electricity facilities from Credit 1002-MAG, in order to contract [mediately for equipment and repair works. An urban development and drainage study for Mahajanga was also financed by the credit. The Development Credit Agreement was accordingly amended on May 21, 1985, and US$ 2.9 million were allocated to Cyclone rehabilitation. B.Imilementation Schedule 3.08 Project implementation was originally scheduled for a four-year period, but was not completed until June 1986, i.e., five and a half years, due mainly to the delays in carrying out the drainage and sewerage studies (para.3.03 and 3.04), and to the rehabilitation of water and electricity facilities damaged by Cyclone Kamisy (para.3.07). Otherwise, the project could have been completed one year earlier. C. Procurement 3.09 Procurement problems were the mai.s source of delays and led to the cancellation of the drainage and sewerage component. The Government's reluctance to recruit international consulting firms adversely affected the implementation: the local firm recruited for the drainage and sewerage  6 implementation: the local firm recruited for the drainage and sewerage studies was incompetent and was dismissed one year later, and after this experience the Ministry of Public Works awarded the contract to JIRAMA, a company relatively well-organized for the production and distribution of water and electricity but obviously not for drainage and sewerage studies. In many quarterly reports and in a letter from the Minister of Public Works, dated August 1, 1984, there were claims that JIRAMA did not carry out the studies correctly and in a timely manner. 3.10 In addition to the bad quality of the bid documents, the Ministry issued the invitation to bid without awaiting the IDA comments and approval (see para 3.05). This was due to the complexity of the Malagasy procurement regulations, which are extraordinarily long, cumbersome and complicated, and to the Government's reluctance to adapt them to international practices. Practically all bid documents and contracts need the approval of the UC-1-ission Centrale des Marches' (CCM), and this takes between four to six months. There is a study uader way made by Maheux Noiseux, financed by IDA (Credit 1161-MAG), which is looking at the procedures of the CCM. Once the findings of this study are complete, it will be possible to recommend changes to improve the procurement procedures in Madagascar. D.Costs 3.11 The comparison between appraisal estimates and actual costs of the project is shown in Part 3. It is difficult to provide any meaningful comparison, because the original project was revised, as previously stated: an important part of the project was almost completely cancelled (drainage and sanitation) and a new component was added for 2.9 million dollars (cyclone rehabilitation). In addition, during the implementation period, the exchange rate between the US dollar and the Malagasy franc rose from 225.8 FMg for 1 US dollar in 1980 to 769.8 FMg in 1986 (and 1234.3 FMg in 1987). Nonetheless, it is possible to explain the main differences: - civil works for water supply exceed appraisal estimates by US$ 1.8 million because of the delays and local inflation; - actual cost of civil works for drainage, sewerage and solid wastes was US$ 1.75 million instead of US$ 12.58 million because the drainage and sewerage component was reduced to some urgent works; - equipment and pipes for water supply amounted to US$ 2.54 million against US$ 6.52 million estimated at appraisal, because everything was imported from France, when the US dollar was very high against the French franc; - consulting expenses were very low for water supply because JIRAMA carried out studies and supervision by itself; - consulting expenses for drainage and sewerage were reduced by USS 1.5 million because there was no supervision of works; and - civil works, equipment and consulting services for the Cyclone Rehabilitation Project were added (for USS 2.67 million), since  7 this emergency component was not included in the project at the time of appraisal. E..Disbursements 3.12 Actual disbursements from the Credit by year compared with appraisal estimates are given in Part 3. Disbursements took place over five and a half years, as estimated at appraisal, but with a delay of one year. The delay was due primarily to a delay of six months of Credit effectiveness and to delays in making decisionsa on procurement. The original closing date of June 30, 1985 was extended by one year to June 30, 1986. 3.13 A graph (Part 3) also gives a comparison of the disbursement performance of this project with the disbursement profile for Madagascar. F.Performance of Consultants and Contractors 3.14 The consulting firm which had carried out the feasibility studies was competent, and the basic design criteria and approaches they proposed were followed. As explained in paras. 3.03 and 3.04, the local firms recruited by the Ministry of Public Works for the drainage and sewerage final design performed below expectations. The first was replaced by JIRAMA, which had no experience in drainage and sewerage. In addition, it has never been a consulting firm. The foreign firm, recruited as sub- contractor by JIRAMA, could not fully play its role, because it had no decision power. Moreover, its contribution was reduced because of a lack of foreign currency. IDA proposed to finance a new contract signed directly with it, but the Ministry did not follow up. 3.15 The overall performance of private contractors was very good. G. Revortina 3.16 Quarterly reports were submitted by JIRAMA in a timely manner to IDA for the water supply component. The other executing agencies, the Fivondronana and the Ministry of Public Works, who did not do the same because the project coordinator (within DGP), who was supposed to do the quarterly reports, was unable to carry out his duties. 3.17 An independant auditor was retained by JIRAMA for its own accounts. Audited accounts were prepared regularly through 1987. Delays occurred at the beginning, but generally the audit reports were recelved within one year after the end of the fiscal year, instead of five months, as required by the Project Agreement (section 4.02.ii). IV. INSTITUTIONAL. FINANCIAL AND ECONOMIC PERFORMANCE A.Institutional Aspects 4.01 One of the main objectives of the project was to strengthen JIRAMA and the Fivondronana. A reorganization study for JIRAMA was financed by the Credit and led to a profound reform of its structures,  8 implemented in February 1986. JIRAMA's organization charts at the beginning and at the end of the project are give:; in Part 3. Under JIRAMA's old structure, operations were shared between two directorates, on a geographic basist the Interconnected Areas and the External Areas. These directorates were abolished and replaced by three technical directoratess (i) Electricity Generation and Transmission; (ii) Electric Power Distribution; and (iii) Water Production and Distribution. In addition, operational activities are decentralized to the regional directorates, which have been given greater management autonomy. The regional directors are responsible directly to the General Manager. Between 1980 and 1985, the labor force declined by an average of 91 employees a year, or 4.2X per annum. The figures are as follows: 1980 1981 1982 1983 1984 1985 Managements 305 332 328 329 323 330 Others: 4,425 4,496 4,062 4,006 3,900 3,946 Total: 4,730 4,828 4,390 4,335 4,223 4,276 4.02 On the technical side, JIRAMA's performance was very good: they carried out final design with their own staff, and prepared the bid documents as well as the supervision of the works without any problem. The Cyclone component also was lmplemented in a satisfactory and timely manner, in less than one year. About 600 new house connections were installed every year. Operation and maintenance improved during the project implementations although the actual production of the water treatment plant is over the capacity of the station, the water quality remains acceptable. The new treatment plant, planned at appraisal for 1983-84, has not yet been constructed, however, the population served has increased from 858,000 (86%) in 1982 to 1,081,000 (89%) in 1986. To meet the future needs, Caisse Centrale de Cooperation Economique, from France, is ready to finance a new project including a treatment plant of 50,000 m3 per day and the reinforcement of the distribution system. In addition IDA is planning a Water Sector Project with a program of low cost house connections for Antananarivo, Toamasina and Antsirabe. 4.03 The project's impact on the Fivondronana was less important, since the majority of its component was cancelled, and its financial situation improved only in 1987, after the closing date. Bs Financial Performance JIRAMA - Overall Financial Situation 4.04 While JIRAMA's audited financial statements for 1979 to 1986 do not show a strong perrormance, a slight improvement can be detected in its annual results over the years. Operating income showed significant annual increases peaking at FMG 5.7 billion in 1985. The company, however, suffered net losses for four consecutive years, 1983-1986, largely due to heavy financial charges particularly in its electricity operations stemming from foreign exchange losses as a result of the weakened FMg. Its accounts receivables situation worsened progressively rising to 50% of total current assets in 1985 and 822 of total operating revenues in 1986, largely due to  9 overdue payments from central and local governments and state-owned companies. Steady increases were also evidenced over the 1980-86 period in the company's long-term liabilities (normal for a company undertaking expansion) and short term liabilities (a more worrisome trend due io increasing accounts payable and recourse to high interest bank overdrafts). Water Operations 4.05 At the time of project appraisal, the Government's stated objectives for its water operations were: to achieve financial viability through recovery of costs; to finance some 642 of its capital requirements for the period 1980-86 from internally generated sources; and to adjust its historically low water tariffs to achieve rates of return of 2.41 in 1981 and 1982 and 62 from 1983 onward. These objectives were partially achieved. Approximately 492 of its investments during 1980-86 amounting to FMg 12,330 million were financed from internally generated sources. JIRAMA was able to achieve and exceed the covenanted 62 rate of return for the first time in 1985 (two years later than had been anticipated) largely due to persistent financial management efforts, including regular tariff increases. Continued strong performance was affected, however, by a significant fall in sales, due to the deteriorating economic situation of the country. Among private subscribers, for example, average consumption declined by 4.72 between 1980 and 1986; a stagnation and reduction of commercial and industrial activities is also evident in the operating data. 4.06 JIRAMA's concern about its weak financial positior (particularly its accounts receivables situation) has led to a number of steps taken jointly with the Ministry of Finance with a view to liquidate the delinquent government accounts and prevent future arrears accumulation. The most important of these was the putting into effect of contracts with the consumers which will allow JIRAMA to effectively sanction government agencies by cutting off services. With respect to the management of the company's growing long-term liabilities stemming to a large extent from excbange rate differences, Jirama requested that the Government take over the exchange rate differentials resulting from matured loans. With respect to the decline in consumption, the Government is giving serious consideration to setting up a credit facility to encourage new connections to the water supply system to compensate for the decline in existing consumption. It is expected that the follow-on Bank-financed project would include a line of credit for household connections. 4.07 Beginning in 1986, JIRAMA initiated a rigorous financial reform program in the context of a Bank Group financed Energy Project (Cr. 1787- MAG). A combination of actions including debt relief on borrowings related to unproductive assets (power sector only), settling of Government related arrears through 1986, divesture of unproductive subsidiaries and power rate increases have contributed to a minor improvement in JIRAMA's financial situation for 1987 and 1988. Substantial improvement cannot be expected in the future, however, without: (1) adopting and regularly adjusting power and water rates to reflect investment, operating and maintenance costs and (2) resolving the basic budgeting and discipline problems responsible for the persistent arrears accumulated by the Central Administration. municipalities and the regional universities. Financial management within JIRAMA will also need to be reinforced by introducing integrated investment  10 and financial planning systems for water operations similar to those being used for power operations. Fivondronana of Antananarivo - Sanitation Division 4.08 Financial management of the Sanitation Division was expected to be strengthened through: (a) establishment of pro forma accounts in accordance with principles of accrual accounting; (b) certification of opening balance sheet as of January 1, 1980; (c) annual review of fixed assets and revaluation; (d) provision of Fivondronana's funds to the Sanitation Division calculated on the basis of the Division's pro forma accounts at least equal to the Division's operating, maintenance cost and capital expenditures; and (e) annual adjustment by JIRAMA on the basis of recurrent costs of drainage and refuse collection services to the rate of the surtax for development works collected by JIRAMA on behalf of the Municipality. Despite the proposals made at the time of appraisal and subsequent agreements reached with the Government, the financial position of the Sanitation Division remained weak throughout the project due largely to the lack of qualified personnel to implement and maintain an adequate accounting system. C. Economic Justification 4.09 The internal rate of return had been calculated at appraisal only for the water supply component of the project. It was 7.4% taking into account the tariffs proposed at appraisal, and only 2.3Z with the 1979 tariffs. In re-evaluating the economic rate of return for the water supply component, the actual cost of the project has been combined with the cost of the treatment facilities which had been constructed separately by JIRAMA (the second step scheduled for 1983 had not been realized). Also included in the cost stream are the future maintenance costs estimated at 5% of the investments costs. The actual costs were deflated to represent prices in 1980 which served as the base year (see Part 3). Costs and benefits were considered over the period 1980-2000. 4.10 On the basis of these assumptions, the economic rate of return was calculated to be 1.2%, compared to 7.4% at appraisal. The reasons for this difference are the following: (i) from 1980 to 1986, compounded inflation was 163% but water tariff increases were only 112%; (ii) expansion of the production facilities, scheduled for 1983-84 has not yet been done, which has limited the water sales; and (iii) completion of the works was behind schedule. The calculation of the ERR, however, underestimates the true economic rate of return, as the water revenues alone do not reflect the full economic benefits related to health and other environmental and social factors. V. THE ROLE OF IDA 5.01 IDA supervision was relatively continuous, as only one change in project officer occurred during the life of the project. During the implementation period, a total of 10 supervision missions visited Madagascar. The number of staff-weeks spent on this project, by task, is given below:  11 EX 1977 1978 1979 1980 1981 1982 1983 1984 1985 1936 1989 LOP 0.5 0.1 11.9 2.8 LENP 0.5 17.6 LENA 42.1 LENN 1.1 12.9 PAD 0.5 0.4 2.6 2.5 0.6 SPN 2.5 4.7 5.2 11.4 9.4 5.4 5.2 PCR 6.5 TOTAL 1.0 59.8 13.0 18.7 4.7 5.2 11.8 12.0 7.9 5.8 6.5 5.02 This represents a total of 146.4 staff-weeks for the whole cycle of the project. No consultant was recruited by IDA. IDA played an important role in convincing JIRAMA to implement an important reorganization and to reduce its staff. IDA was also instrumental in discussing the tariff increases with the Government. Although the tariffs are not yet sufficient, no decision would have been obtained without the strong pressure exerted by IDA. VI. CONCLUSIONS 6.01 On the water supply side, the project was successful in addressing deficiencies in water availability, tariff policy and financial management. On the drainage and sanitation side the bad performance of ti.e local consulting firms recruited, associated with the complexity of the Malagasy procurement procedures, jeopardized the entire component which was cancelled except for some urgent works. Nevertheless, the drainage and sanitation works will be reactivated, combined with flood control, under the Antananarivo Plain Development Project. The review of the existing studies, carried out for its preparation, led to major revisions and better coordination between the various components of the project. Concerning the Fivondronana, its deficiencies on the financial and technical sides are being addressed under the First Urban Project (Credit 1497-MAG). 6.02 The main lessons to be learned are the necessity to have the final design available at appraisal, as it is done now, and not to accept the recruitment of local consultants if their experience and competence are not clearly established.  12 MADAGASCAR WATER AND SANITATION PROJECT Credit 1002-MAG Proiect Completion Report Part II: Project Review from Borrower's Pcrspective Water Supply  13 Antananarivo Water and Sanitation Project Credit 1002-MAG PROJECT COMPLETION REPORT I. INTRODUCTION A number of public agencies are in.ilved in the weLer sector: the Miti stry of Industry, Energy and Mines, the inLStty of Public Works, the Ministry of Agricultural Production and Agrarian Reform, the Ministry of Animal Production and Water and Forest Resourtes, and the Ministry of Health. II iddition, non-governmental agencies still concern themselves with certain rual areas and there are one or twta muricipal authorities. Currently, a Warpr Supply and Sanitation Committee set up under the International Decade of Potable Water and Sanitation is responsible for coordinating, guiding and monitoring all water supply and sanitation activities. The general objectives for water supply are: - study of the means of providing a satisfactory waLet stupply to the entire population; - gradual construction of schemes aimed at serving tht whtolte population; - standardization of the terms (especially tariffs) otn which people are supplied; - financial viability of water supply entities; - recovery of water service costs. The City of Antananarivo Water Supply and Sanitation Project marks a decisive step forward since it helps meet the needs of the capital city, which contains more than a third of Madagascar's urban population. It also lays the bases for a long-term urban water supply development program and will provide a framework for later supply to rural areas. In 1976 the Government set up JIRAMA, a 100% state-owned enterprise responsible for building and operating water and electricity supply facilities throughout Madagascar. JIRAMA operates all urban water supply networks except  14 for a few municipal authorities. It takes over these authorities as and when the public finances permit. JIRAMA is also responsible for rural water supply lines and is expanding more and more into the rural areas through the construction of new conduits. II. PROJECT IDENTIFICATION, PREPARATION AND APPRAISAL Preparation of the project arose out of the City of Antananarivo Water Sector Master Plan study which was carried out by the French consulting firm of Omnium Technique Holding (OTH) on behalf of the World Health Organization (WHO) under the aegis of the United Nations Development Program (UNDP). The World Bank, which has kept in touch with the studies from the start, included this project in its lending program in December 1976 at the Government's request. Before going into the details of the "Initial Program" we shall recapitulate the history of the potable water supply system of the city of Antananarivo. A. The system was originally designed to supply the historic center, largely concentrated on the hillside. Water was drawn from a small natural lake, easily supplied by the Ikppa River. The production facilities comprise: - a water treatment plant at Mandroseza with a rated capacity of 85,000 m3/day of filtered water; - a general pumping station providing boosting and distribution of potable water 24 hours a day. From this production center, six feeders supply the city's main reservoirs (2 , 250, 1 x 350, 1 x 450, 1 x 500 and 1 x 600 mm diameter), climbing the hill slopes or circumventing the points of most difficult relief. A number of neighboring communes are currently served. The city is divided into several distribution zones or levels, comprising three main sections: - the medium-level zone, which supplies the bulk of city consumption (about 80%) and is fed directly by the Mandroseza pumping station and equipped with numerous reservoirs located between elevations 1334.7 m and 1344.7 m, i.e., about 95 m above the average level of the Antananarivo Plain (1,248 m); - the higher-level zones, which supply high areas (70-200 m above the plain) or remote sections, requiripg the use of boosters on the network; - the low-level zones, which supply piedmont or plain areas.  15 The approximately 500-km distribution network has been extended outward to serve the new neighborhoods. It also comprises boosters or relay stations that feed the higher zones. B. The "initial program" at that time comprised three separate parts: (1) The immediate program, covering the period 1975-76. comprising urgent works to be financed out of own funds: - construction of reserroirs R17-Obser-vatory (pilot reservoir) and R18-Ambohimamory (equalizing reservoir); - improvement of distribution by extending the Betongolo 350-mm conduit and strengthening the 200-mm conduit between the Anosibe grade crossing and the Western road terminal by a 300-mm conduit. - enhancing plant production reliability by laying a 200-r conduit to Alasora which could be used to pump Alasora underground water to Mandroseza in cases of exceptional shortage. (2) The first-stage program covering tAe period 1977-80. comprising: - increasing the plant's production capacity by 25,000 m3/day by strengthening the water intakes on the Ikopa River, installation of a new 2,000-m3/hr pump at the Ikopa intake station, construction of a grit removal tank, expansion of the raw water pumping station (one 1,500 m3/hr pump) and a 3,000-m3 tank; - constitution of the "low-level" zone with isolation of the two conduits to the right of the hills of Itaosy and Ampitatafika which feed the western outskirts in the event of failure of one of the conduits supplying R18, installation of a lifting station near Rlg to pump the water to R10 (Itaosy), piping and feeder links, reorganization of the West Plain network, and installation of the East Ring with the R12 as pilot reservoir; - supply of the outlying communes of Alasora, Ambohitrimanjaka and Ilafy. Supply of Alasora by a 200-mm conduit; supply of Ambohitrimanjaka by an independent system using the water table of the neighboring plain; supply of Ilafy by a 12-mm PVC pipe in the extension of the SOMACOU plant; - strengthening and expanding the distribution network by remaking reservoir R3-Ambohijatovo, with a reserve of 2,200 m3 compared with 1,100 m3 at present; linking the 600-mm feeder at the right of reservoir R17 to the 250-mm conaduits that partly supply the Guillet relay by means of a 400-m conduit; strengthening in stages of the 200-mm conduit linking Anosibe  16 tN Anosizato by a 300-mm conduit; construction of reservoir R19 (above-ground reservoir, 1,000 m3) and extension as far as this reservoir of the 250-mm conduit proposed for 1974 on the Hydrocarbons Road; replacement of the Ambohimanarina booster set by another, more powerful set; strengthening of the northern outskirts reserves by constructing a 500-m3 equalizing reservoir at the foot of Ambohidratrimo hill and laying a 200-m3 conduit which would link the booster to this reservoir. (3) The second-stage program, covering the period 1980-85, comprising: - expansion of the MandrosezA plant; - taking into service of a new 25,000-m3/day production unit (in 1982), raising production capacity to 100,000 m3/day with installation of two pumps on the "8 bars" level, construction of 3,000-m3 tanks, installation of a water intake pump on the Ikopa River and of a raw water pump at the plant, and taking into service of the bypass canal around the lake; - completion of conistruction of the 1,320-m level which will ring the city, with the following links: Fiadanana (R15)-Anosibe, Anosibe-Isotry, Isotry-Antanimena, Antanimena-Hydrocarbons, Hydrocarbons-Ampasampito (R22), R22-Mandroseza Plant; - strengthening of the "high level" zone (1,340 m); - strengthening of the "low level" zone (1,320 m) with construction of reservoir R22 (5,000 m3) and doubling of reservoir R15 (Fiadanana). Two pilot lines will link these two reservoirs to the plant; - extension and strengthening of the city periphery branches. in view of the operating constraints at that time (delay in start-up of the first segment of the works and rapid growth of demand, resulting in total saturation of production facilities), JIRAMA was compelled to finance out of its own funds, in addition to the immediate program, part of the works of the first segment (installation of the additional 25,000 m3/day unit). As a result, the project was negotiated with the World Bc-k on the b_sis of the first-stage program. Genesis A. The project was ijade necessary by a variety of factors: - saturation of the production and distribution facilities (for economic reasons, the maximum capacity of the plant matches that of the network);  17 - nearness of the concession expiration date; - lack of an overall plan and long-term development framework. B. The following agencies participated in project identification: * - the Administration, represented by the Mines and Energy Directorate. Its role was to provide coordination between the two parties (concession-holder and local authority); - IDA (International Development Association), the chief supplier of funds, which helped the participants identify the project; - the concession-holder, at that time the Societe Electricite et Eau de Madagascar (EEM), which later became the Societe Malgache de 1'eau et de l'Electricite (SMEE). C. Choice of the optimum solution was determined hy a feasibility study. Preparation, appraisal, negotiation and approval A. The project was conducted entirely by a local team of JIRAMA, from preparation through appraisal and negotiation to execution. B. (1) The changes in relation to the initial project mainly concern the execution timetable. However, some minor alterations were made: - addition of a %ck-up electrical pump set at the Ikopa River water intake; - addition of supplemental conduits to form a number of grids on the distribution network (R13-Talatamaty, road dike-Ambodimita). The administrative delays between the Administration and IDA caused the project in general to fall behind schedule, as shown in tables I and 2 below. On the other hand, both the dimensions and content of the works remain unchanged. B. (2) Following negotiation with IDA, a few corrections had to be made as a result of changes in demand centers due to the economic situation at that time. Thus, works scbeduled for the second segment had to be brought forward and a new spatial distribution of the consumption centers had to be effected, involving minor changes in the distribution system: - alteration of the shape of reservoir R19 (Ivandry) to take architectural account of the environment: upper-income residential neighborhood;  18 alteration of the shape and capacity of reservoir R21-Ambohidratrimo (change to 1,000 m3) in view of the appreciable increase in demand in this area; consequent modification of the number of grid and linkage conduits of the new demand centers. turpose The program of long-term development of JIRAMA is currently being formulated following setting-up of the new Economic Studies and Planning Directorate. Proiect descridtion A. Physical works The works comprise mainly: - increasing production capacity by building a raw water pumping station on the Ikopa with a 2,000-m3/hr pump (a second pump is installed as back-up) and a grit extractor, then by installing a 1,500-m3/hr raw water pump on Lake Mandroseza and also a filtered water pump, including raw water conduits, accessories and electromechanical equipment (control panel, transformer, etc.); - increasing the capacity of the main distribution conduits, involving a total of 33 km of diameters 125-350 mm; - increasing reserve capacity by building 4 reservoirs, at Ambohijatovo R3 (2,200 m3), Ampasampito R22 (2,500 m3), Ivandry Rl9 (1,000 m3) and Ambohidratrimo R21 (1,000 m3); - strengthening heavy maintenance equipment by acquiring a high-pressure Jet cleaner, a leak detection vehicle, two-way radios, electromagnetic flowmeters, compressor, pneumatic hammers, discharge pumps, pipe-cutter, winch, etc.; - increasing the trainee capacity of the Ambohimanambola Vocational Training Center (CFPA): construction of 6 new buildings: block A-D, dormitory for 64 trainees, total area 1,015 m2 including the upper floor; block AFG, lecture room, workshop and store, total area 898 m2; block F, electricity and safety lecture room and workshop, total area 195 m2; block E, diesel lecture room and workshop, total area 274 m2;  19 block G, CUR lecture room and workshop, total area 195 m2; * block B-R, cafeteria and kitchen, total area 171 m2; Rehabilitation of 3 existing structures: block 1, library and lobby; block J, basic workshop; block K-l., electrotechnical lecture room, workshop and measurement and testing connections; -- expansion of teaching equipment and material (water analysis, water system). B. Financial aspect In accordance with point J of the recommendations contained in appraisal report no. 2266a-4AG of January 26. 1980, a tariff study has been carried out by JIRAMA. C. Institutional aspect In May 1986, CEGOS, which was then carrying out a study mission concerning restructuring of JIRAMA, was asked to propose a training program for all water-sector personnel. The proposal presented was not satisfactory to JIRAMA. In November 1985 a new proposal, drawn up together with CGE (Compagnie Generale des Eaux), was approved in principle by IDA. A contract between the two parties to formalize joint action was signed in early 1986. A CGE expert mission to prepare for start-up of the training took place during February 1986. However, tne training program could not subsequently be put into effect for lack of credit funds. The project was, however, able to finance: - sending two administrative managers to CEFIGRE; - sending an engineer to a seminar in Dakar. III. EXECUTION Operations The equipment acquired under the project piping (lots 1-2-3) and electromechanical equipment (lots 4-5) -- improved water production operations by improving extraction and pumping reliability. On the distribution side, network output was raised with improved flow distribution and suitable service pressure.  20 In civil engineering works there is an appreciable reserve capacity, necessary for good response to consumption fluctuations, which gives a better level Or service. It can therefore be stated that no excessive deviation from the original projections has occurred and that on the whole the results obtained are satisfactory. 'Start-up of the project Start-up presented no special problems. Getting the invitatior. to tender documents into final shape took a little more time at the beginning but the regular tempo of operation was quickly reached. Execution of the project calls for no particular comments except that, generally speaking, the actual time taken to execute the works was longer than planned. All the works and services suffered more or less substantial delays except for the Ambohimanambola Vocational Training Center civil engineering works and laying of the piping. Pipe-laying had to be deferred owing to local currency financing problems but the works execution deadline was met (table 3). It is also noted that while expenditures all exceeded the projections, ti,ey remained within the credit ceiling (table 4). Contracting Temporary difficulties affected mainly the drafting of contracts at the beginning of the project (lots 1-2-3, supply of piping) because the texts in force in Madagascar sometimes conflict with those normally used for international consultations. A compromise was eventually found and, apart from delay in notification of some contracts, there were not too many deviations. Contractors and suppliers Overall, this calls for no particular comment except perhaps that the works contractor sometimes had difficulty in adhering to the conditions of tender out of concern for the deadline. In the case of suppliers, the few problems that arose concerned compliance with the administrative and general clauses. It should be noted that no price revision in the true sense took place since the execution deadline rarely exceeded 12 months, apart from lot 4-5 (14 months) for which the supplier did not request price revision. Training component The personnel training part was left until toward the end of the project. An overall program was approved by IDA but could not be executed for lack of credit funds. However, in view of the urgency, specific training opportunities were provided for a number of trainees. In addition, the Credit financed part of the works of construction of the JIRAMA Vocational Training Center, the balance being provided jointly by Credit 817-MAG, Andekaleka Hydroelectric Scheme.  21 Disbursements Disbursements fell well behind schedule, reflecting the execution delays. We give below for comparison the original table and the end-of- -project table (table 5). Execution timetable A. The werks completed by the original deadline concern the civil engineering works for the Ambohimanambola Vocational Training Center and pipe-laying (taking into account the late start of the work). They represent about 31X of project cost (table 6). B. The delay is due to two factors: - for lack of time, the invitation to tender documentation could not be properly detailed (for example, the test drillings were not done); also, bidders were asked to carry out prior inspection and studies of the sites and to take the results into account in their bids; - the bidder selected (the lowest bidder) was unable to take this aspect into account for reasons of economy; this is reflected in the difficulties encountered during execution (lot 7 in particular). On the other hand, where the bidder took all the difficulties into account at the time of his bid, the works could be completed ahead of time (lot 8); this applies only to pipe-laying. The same problem was encountered in remaking of roads, i.e., lack of in-depth advance knowledge, aggravated by changes in roads due to works carried out by the Ministry of Public Works after the contract was awarded. Generally speaking, the original timetable was not adhered to, owing to (a) a general time-slippage affecting the start-up of the operations, and (b) supplemental works due to either terrain difficulties or changes in quantities. Costs The actual costs are known precisely following settlement of the invoices for the various works and services. At the time of writing this report 99.9% of the actual costs are known. A. The actual costs are very exact. The actual expenditures effectively match the figures contained in the bids and the costs projected at appraisal (including the provisions for quantity overruns and price increases), both for the project as a whole and for each of its main components (table 7).  22 B. Costs rose where there were design changes (Ikopa intake, Ivandry and Ambohidratrimo reservoirs) or supplemental works affecting quantities. They were also affected by the exchange rate fluctuations. Overall, referring to the currency of account, the US dollar, the overrun provisions were adequate thanks to successive and lasting monetary realignments. The cost overruns were in this way wiped out, and overall it can be said that the cost of the project was less than projected. This left a residue which was used directly to finance operations supplementary to the basic project. Cleaning of Lake Mandroseza Lake Mandroseza, which is fed by pumping from the Ikopa River, silts up naturally due to erosion and river-borne material. The present theoretical water reserve is 12 days but the actual reserve is undoubtedly lower. The purpose of the operation is to increase the water reserve by clearing the Lake of sediment. Remote surveillance of the network The Antananarivo city network comprises 21 reservoirs and 9 boosters which are located far from the water plant. A car is used to monitor reservoir levels and booster condition and it is practically impossible to perform this task properly. Remote surveillance allows the data to be transmitted to the plant and makes it is unnecessary to intervene unless a breakdown occurs. IV. OPERATING RESULTS Between 1980 and 1986 total water sales volume rose by an average of 8.872. The sharpest increase (36.37%) was posted by municipal services (offices, wash-houses, street watering, miscellaneous). Consumption by private subscribers (households, industry, business) and government services (ministries and other consumers) fluctuates around 22. Among private subscribers, average consumption per subscriber declined between 1980 and 1986 by 4.70X, with the result that sales did not develop as projected. The fall in sales seems to be due in part to application of the tariff increases set forth in the appraisal report. Other factors that help to explain it are: - stagnation and reduction of commercial and industrial activities; - reduction in household purchasing power; - inadequacy of water financing resources. The first two factors, which are external tc JIRAMA, are difficult to overcome. The cash shortage, due to the increase in delinquent accounts (accounted for in large part by the decentralized local authorities), prevented JIRAMA from carrying out the necessary maintenance works. Thus, the  23 renewal and maintenance works carried out between 1980 and 1985 amount to about .... for the entire period. This deficiency is the underlying cause of the increases in direct water operating costs and is reflected in: - a decline in production capacity, which is now below rated capacity; - an increase in surveillance and maintenance labor costs; - the sharp fall in network output. V. FINANCIAL BALANCE SHEET JIRAMA's financial situation is characterized by rising trends in both (a) delinquent debtors and (b) long-term and short-term liabilities. Out of debtors of FMG 19.9 billion in the 1986 balance sheet, FMG 13.3 billion relates to government debts (central government FMG 7.4 billion, decentralized local goverumnents FMG 5.9 billion). The remaining FMG 6.6 billion is accounted for by large companies and households. Of the RMG 5 billion due from large companies, FMG 3 billion represents unpaid accounts of state-owned companies in difficulty. Financial rehabilitation operations have been started jointly with the Ministry of Finance with a view to liquidating these delinquent accounts: - payment of decentralized local government arrears out of the proceeds of charges and surcharges; - payment of central government arrears by the Ministry of Finance; - drafting of a new administration contract allowing JIRAMA to cut off service; - drafting of a program contract (contrat-plan) for settlement of future consumption billings. The development of long-term Liabilities results from updating of exterval debts. The contra to this updating, FMG 63.4 billion in 1986, constitutes the "exchange difference" which appears in .... Discussions have been initiated with the Government for the latter to take over the exchange differences resulting from matured loans. These exchange differences will be converted into a capital increase. Income Situation JIRAMA's income situation deteriorated steadily between 1980 and 1986. Overall, the cost of labor per quantity produced and sold was fairly stable and therefore constitutes fixed charges. The growth of unit cost of Labor in thermal generation from 1.87 to 3.60 is due to the reduction in volumes produced by the thermal power stations.  24 Electricity operations were marked by a rapid rise in unit cost of fuel, from 14.77 in 1980 to 47.95 in 1986. Other costs, accounted for largely by spare parts for upkeep and maintenance, al'o rose fairly sharply. In addition, the deterioration in the exchange rate meant that Electricity had to bear a fairly large share of loan interest. In Water, the most striking rise in unit costs was on the production side. Consumption of chemical products rose from 0.9 in 1980 to 5.76 in 1986. The rise in cost of energy consumed, from 7.50 in 1980 to 12.78 in 1986, is due to application of the new tariff policy. Other costs, relating to upkeep and maintenance of production and distribution facilities, rose because of inflation. Water Supply Finaacing JIRAMA posted net self-financing capacity of FGM 8,850 million for the years 1980 to 1986. The Government's participation of FMG 6,050 million has to be regarded as own funds since it is non-reimbursable. Self-financing by JIRAMA could therefore be put at FMG 14.9 billion. Investment during the period reviewed amounts to FMG 12,330 million. Kaintenance and renewal expenses amount to FMG 1,319 million. This represents 45% of the provision set up. Expenditure commitments could not be made owing to cash-flow difficulties. VI. ROLE AND DEVELOPMENT OF INSTITUTIONS Under JIRAMA's old structure, operations were shared between two directorates, primarily on a geographic basis: - the Interconnected Areas Directorate (Direction des Zones Interconnectees -- DZI); - the External Areas Directorate (Direction des Zones Ext6rieures -- DZE). The distinction between interconnected and external areas is becoming more and more artificial. First of aLl, the management of a number of isolated centers attached to the interconnected area resembles more that of external-area sectors. Second, the DZE also possesses interconnected localities such as Toamasina and Fianarantsoa. Moreover, these two directorates have instituted relatively heterogeneous management styles. Thus, each of the directorates possessed its own system of management, both for electricity and for water. These problems were aggravated by lack of a planning system. In order to coordinate and unify operations in each sphere of activity, the DZIs and DZEs were abolished and replaced by technical directorates:  25 - Electricity Generation and Transmission Directorate (Direction de Production et Transport Electricite), responsible for technical management of generating and transmission facilities; - Electric Power Distribution Directorate (Direction de Distribution d'Energie Electrique), responsible for technical management of electricity distribution facilities; - Water Production and Distribution Directorate (Directiotn de Production et Distribution d'Eau), responsible for technical management of water production and distribution facilities. Administrative coordination of operating activities is provided by the existing Audit and Internal Control Directorate. The investment function is the responsibility of three directorates: - Economic Studies and Planning; - Electric Power Plant; - Water Supply Plant and Works. With the object of installing a single management system for both electricity and water and on the technical and administrative sides within the near future, the organization unit has been converted into a Methods and Systems Directorate. Operational activities are decentralized to the regional directorates, which have been given greater management autonomy. The regional directors are responsible hierarchically to the Director General. NOTE: The tables referred to in the text have been omitted due to thpir illegibility.  26 ORGAN1ZATION CHART OF JIRAMA (February 1986) GENERAL MANAGEMENT Press and Public Relations _ Coordination and Contro Auditing. . . - ~~~~~~~~-ltMthods and Systems|- A 71 0 Liia ciaSW 3 C S AJ SWI 2 C E-f~~~~~~~~~~~d 'I-~~~~~~~~~~~~  27 MADAGASCAR WATER AND SANITATION PROJECT Credit 1002-MAG Proiect Com21etion Report Part II: Project Review from Borrower's Perspective Drainage and Sewerage  -48 Democratic Republic of Madagascar Antananarivo Plain Development Antananarivo, January 11, 1989 Project Office No. 089 FAR/LNT/BPPA/89 Subj: Report on Sanitation in Antananarivo Chief, Infrastructure Division South-Central and Indian Ocean Department World Bank Attn: Mr. Gerard Tenaille Washington, D.C. Dear Sir: Following your recommendation at the September 20, 1988 meeting to the Directorate of Planning in Antananarivo, I have the boqor to enclose a report on the Antananarivo urban sanitation studies and works carried out since 1950. The studies done in 1968 by Societe Grenobloise d'Etudes et d'Applications Hydrauliques (SOGREAH) are not included, owing to a lack of documents. Yours truly, Is/ Royal Raoelfils Director  29 Report on Sanitation in Antananarivo Background and Overview In 1949-50 the Water and Sanitation Company (Societe Eau et Assainissement -- SEA) submitted a preliminary design for a sanitation project in Antananarivo. That preliminary design covered some 1600 ha using a seperate system for drainage. Mr. Fontaine, an engineer, made a mission to Antananarivo in 1956, essentially to reconcile the SEA sanitation study with the master urban development plan for the city drawn up by the Department of Architecture, Urban Development and Housing. To that end, a master sanitation plan for an area covering 2,900 ha was formulated, i.e. approximately 1,300 ha more than in the SEA plan. In June 1973 Ommium Technique (OTH) began the studies on the water supply and sanitation project. The studies involved essentially three components: water supply, sanitation and drainage; disposal of solid wastes; and a fourth component which mapped out national plannin- for water supply and sanitation in Madagascar. For the studies on drainage and sanitation, OTH had formulated master plans for both storm and waste water. In the meantime, limited-scope works had been carried out. The Sixty-Seven Ha pumping stations were built respectively in 1955/56 and 1964/65. The Isotry pumping station collects water from networks in the combined system of the city center while the Sixty-Seven Ha station collects water from the networks of a seperate system (Ampefiloha Cite, Mahamasina watershed area and its environs). Collector It known as the "downstream network," was built in 1962. It reaches the Sixty-Seven Ha pumping station after running along the right bank of Andriantany canal and serves the above-mentioned watershed areas. At the same time, a collector partially encircling Lake Anosy was built and connected to Collector It. About 1960, purification stations were built at Ambohipo, University at Ankatso, Analamahitsy and Ivato. The Ivato station is the only one now in operaticn. Following the above-mentioned studies and in particular those done by OTH, a project agreement was concluded between the Government of Madagascar and the World Bank (IDA) in June 1980 with a view to finalizing the studies done by OTH for the first phase so that the works in question could be carried out. A studies contract was signed with SECMO-MADAGASCAR in 1980/81, but later cancelled. The Department of Urban Development and Housing within the Ministrv of Public Works reissued a limited invitation to bid, following which the JIRAMA-OTUI group was selected in 1982. The engineering studies awarded to that group took about two years (until mid-1984). It was pointed Out by the  30 donor that the disbursements were to end in June 1986 and as such the proposed works under the studies done by JIRAMA-OTUI could not be carried out given the very short time remaining (about one year). In the meantime, a contract for sanitation works in the low-lying areas of Antananarivo was signed with SARA et Compagnie and in early 1985 a contract was concluded with the COLAS company for the rehabilitation of the existing sewers in Antananarivo and the repair of the Isotry and Sixty-Seven Ha pumping stations. In 1986 the draft study entitled "Master Sanitation Plan" that included the studies done by JIRAMA-OTUI and was supplemented by the sanitation unit of the Department of Architecture, Urban Development and Housing was incorporated into the studies contract for Antananarivo Plain. That sanitation project is now pait of the Antananarivo Plain Development Project. Development of Master Sanitation Plans Documenits on the preliminary sanitation design prepared by SEA could not be located. It is merely known that the storm drainage system was separate and that the studies done by SEA were undoubtedly revised and supplemented by the team led by Mr. Fontaine. A. Fontaine Report The Fontaine Report (January 21, 1957) essentially reconciled the sanitation study prepared in 1949-50 by SEA with the Antananarivo master urban development plan. To that end it drew up a sanitation master plan, together with -- still within the framework of that master plan -- an FMG 300 million sanitation works program to be carried out in three years (estimated at that time). The sanitation master plan (Fontaine Report) had three parts: - Fill operations for low-lying areas; - Storm drainage; - Disposal of waste water. As mentioned earlier, the master plan covered an area of more than 2,900 ha and a total population of 189,924. Of that total, some 160,000 people lived within the area.* 1. Fill operations for low-lying areas The notion of fill operations for low-lying areas originated with the urban development plan at the time, which called for extending Antananarivo over more than 1,000 ha of low-lying areas. Gravity drainage of *TN: Logic of original is elusive; translated literally.  31 runoff water was impossible without coordinated fill operations in accordance with a master plan. A pumping system was consequently devised for storm dra4nage and the some 1,000 ha divided into a large number of zones, each of which was to have a pumping facility. Average height Zone Area (ha) ml of Fill of fill (m) Northeast 185 3,748,000 2 Southwest (a) east of Andriantany Canal 75 1,102,000 1.50 (b) west of Andriantany Canal 620 7,040,000 1.15 Southeastern basin 210 1,070,000 0.50 1,090 12,960,000 1.30 The fill operations posed two main problems: (a) investment: about FMG 4 billion; (b) site for extracting the some 13,000,000 m3 of fill material. 2. Storm drainage AccorGing to the report, Andriantany canal was the main storm collector for Antananarivo, and the drainage of runoff water posed serious difficulties there. The dimensions and very low slope of the canal severely limited its flow to below current volumes. Nevertheless, except for sevaral unfavorable months, it did not appear that the situation as a whole was too bad. This was because of two reasons: - There were a number of regulating basins such as Lake Anosy, Lake Behoriri1ba and Lake Tsimbazaza, which eased the runoff problem. Along its entire length Andriantany canal was bordered by rice fields, which it could irrigate or drain. The study had taken into account the comments made by the Department of Architecture (Ministry of Public Works) on tne 1949-50 study, regarding grading, outlets, the calculation of runoff flows and water storage ponds (retenues), and determining the drain sections. The pre-existing outlets that still remain are the Mamba and Ikopa Rivers and Andriantany canal.  32 As the plain still had the characteristics of a "polder" during the flood season, the master plan envisaged doubling the (capacityl of Andriantany canal by builling another that would run immediately south of Soanierana and to the west along the newly expanded low-lying areas of Antananarivo, and later rejoin Andriantany canal to the north. The Fontaine project had assumed the Adriantany canal's intake would be maintained at Tanjombato along with the construction of a dam that could be opened or closed between that intake and southern Antananarivo. Consequently, the project proposed using the upstream stretch of the canal for the ricefield irrigation studied by the rural engineering offices. At the same time, Andriantany canal could also be used, with the dam lowered, to transport irrigation water outside the rainy season to irrigate the ricefields downstream of Antananarivo. The doubling of the canal was thus called for in the project to transport all rainwater from the southeastern valley to downstream of Antananarivo, along with the runoff water from a portion of the low-lying extensions to the west. The works envisaged for Antananarivo's storm drainage network as a whole, including the necessary secondary collectors in the expansion areas and the water storage ponds, would represent an investment of FMG 1.1 billion. 3. Disposal of waste water The Department of Architecture had moreover concluded from its findings that the study prepared by SEA could serve as a framework for the waste water system. The main objective of the Fontaine master plan was essentially to update the overall thrusts of that study, given the urban development plan at the time and its projections regarding the expansion areas and the future population there. About 160,000 people lived in the area to be developed. For water consumption, supply in 1956 (inl Antananarivo was 21,000 m'/day, of which connected customers accounted for a maximum of 43X. The remainder corresponded to standpipes and losses. Given the small number of private connections to the sewerage system (1,756), the project ostimated that the maximum volume of waste water conveyed by the sewers was about 7,000 m'/day. The project called for basic treatment of weste water before discharge into the Ikopa. Treatment was done by auto-purificaticn (lakes) or simple decomposition. The pump sites were as follows: - a flood pump in Andohatapenaka; - a main pumping station in Isotry;  33 a pump at Ankadifotsy; a pump for the Manjakaray-Nanisana area; three facilities for the expansion area west of Antananarivo; a facility for the low-lying area south of Antananarivo. Amount of Investments waste water drainage system FMG 2,200,000,000 purification stations FMG 1,000,000,000 FMG 3,200,000,000 Recapitulation of estimates excluding TUT fill of low-lying areas FMG 4,000,000,000 storm drainage FMG 1,100,000,000 waste water drainage FMG 2,200,000,000 purification stations FMG 1,000,000,000 FMG 8,300,000,000 Conclusion The FMG 300 million works program represented only a small portion of the sanitation picture. B. OTH Report I. Storm Drainage Master Plan The study for the storm drainage system by and large covered the area in the prefecture of Antananarivo. The prefecture covers about 8,000 ha, of which 5,000 ha are hills and 3,000 ha plains. The master plan sought to identify the most economic solution to meeting the needs relating to water supply using rainwater between the present and the year 2,000. Current problems, which are discussed at length in the study on the existing system, are of two types: (a) Localized floods due to the inadequacy or lack of secondary collectors. The flood water can be reabsorbed in about an hour. (b) Generalized floods in several neighborhoods located downstream, owing to the inadequacy of the mains and shortcomings of the outlet system, which can cause the water to stagnate for several days in the low-lying areas.  34 The prospects and demographic changes projected in the socioeconomic report suggest, for a medium-case scenario, that the population in the prefecture will be 900,000 by the year 2,000. The population at the time was 400,000. I.1 Description of the project Because it has the characteristics of a polder, the embanked urban area requires downstream pumping. The complicated relief of the hills, large number of watershed areas and sudden break in slope between the hills and plain require many upstream water storage ponds. The primary network consists of three main north-south canals: - the Sixty-Seven Ha canal, which runs up to the downstream retention pool (basin d'accumulation); - doubling of Andriantany canal; - Andriantany canal, with the two branches east of Eastern and Masay Valleys. (a) Downstream pumping station A site for the station had been selected along the banks of the Mamba in order to avoid large backflows from the retenticu ponds. The water passes through a reservoir upstream of the pumping station, and which is crossed by a canal and extended by an embanked channel. This system would provide 30-year protection against the floods of the Mamba. Water retention works (fermeture) to the north of the city consisted of raising the height of the dike on the left bank to 1251.50 [?m], requiring two additional operations: - strengthening of the dike: Laniera Road from Soavimasoandro to the Mamba; - relocation of the Laniera drainage outlet beyond Highway RN4 (Mahajanga Road) downstream of the new dike route. Alternatively, an embankment between Soavimasoandro and Ambohimanarina had been envisaged (route of the future main bypass). (b) Pre-pump and retention ponds The ponds to the west would be embanked up to 1249.20 [ml and those to the north up to 1248.20 (ml. Spillages were also planned for the overflow of excess water above the elevations of 1248.90 and 1247.90 in the secondary reteation ponds.  35 (c) Primary network The primary plain network would consist of the existing Sixty-Seven Ha canal extended to the retention pond (south of Anosipatrana) by an earthen structure 10.80 m high (de plaford). In its upstream portion, the canal would be laid up to the storm reservoir (24 ha) to the right of Highway RN1 (Arivonimamo Road). Andriantany canal and its downstream doubling Rerouting was planned from Anosipatrana Road to Antanimena, connecting at elevation 1246.00 at the confluence with the Masay outlet. Its doubling, starting from the center, would have the identical profile. (d) Unserved urban areas -- conservation raeasures The adoption of service standards had ultimately led to limiting the infrastructure for the large basins of the city center, plain and east. The use of the low-lying areas and ricefields as natural retention areas or a storm reservoir would make it possible to postpone urbanization as long as possible, conservation measures in these areas were adopted (eg. construction ban). (e) Irrigation and drainage system Andriantany canal, the primary irrigation channel for its urban run, serves as backup collector (?collector de garde) and must be protected from the rain. The irrigation system now receives its water from Tanjombato Dam, where the Andriantany canal originates. A diversion structure with a capacity of 10m3/sec 400 m from the Soanierana Dam running east-west and then north-south to Anosipatrana Road, where it would connect with the existing irrigation system, consequently mt'st be built. I.2 Phases of the Proiect The project has three phases: I.2.1 For the short run: 1980 (a) Construction of the downstream pumping station with a capacity of 8m'/sec (outlet operations) with northern reservoir (70 ha). Raising'the height of the dikes on the Mamba and northern water retention works; (b) Recalibration of the Andriantany canal with discharge collectors from the city center and extension via a new downstream canal to the right of the northern industrial area;  36 (c) Douoling uL Andriantany canal from Isotry to the northern reservoir, with discharge works from Andriantany canal to the right of the city center; (d) Connection of the Sixty-Seven Ha with the new canal referred to above; (e) Storm reservoirs for the eastern valley and the confluence with the Masay up to the Andriantany and the mains from the eastern valley; (f) Repair of the secondary and tertiary structures in the city center (Tsaralana in particular, Mahamasina); Additional secondary and tertiary structures in the Eastern Valley, Anatihazo, Antohomadinika and Ambohimanarina. New structures from the industrial area of AmbodiLsiry; Connection of the southern section of the Andriantany (north Ambohimanarina) (g) Protection of Lake Mandroseza (h) Diversion of the irrigation network. Paras. a, b, c, d, and e are part of the program for the short run. I.2.2 For the medium run: 1990 (a) Primary canal from Masay Valley to the storm reservoir of Nanisana Valley; (b) Final outlet of the Sixty-Seven Ha canal; (c) Retention pond and pumping north-south of Ambohimanarina with connection to the northern reservoirs; (d) Plain storm reservoir with connection to the Sixty-Seven Ha canal; (e) Kain primary reservoirs in the southern industrial area; (f) Additional secondary and tertiary struczures of Ivandry, Soavimasoandro, and Tsimbazaza; (g) Storm reservoir and retention ponds in the Tsimbazaza Valley with southern pumping station; (h) New secondary and tertiary structures on the plain and the left bank of the Masay. 1.2.3 For the long run: 2000 (a) Development of additional retention areas; (b) Mains in the valley upstream from the Masay; (c) New secondary and tertiary structures for the plain and Wlasay Valley.  37 1.3 Estimated initial investment cost (millions of FMG) 1980: 2,767.46 1990: 1,277.73 2000: 224.54 4,269.93 II. Master Waste Water Plan The scope of the study of the waste water system covers the same urban area as that of the rainwater system. The objectives of tLe project can be summarized as follows: (a) Ensure the collection of waste water: - downstream from the combined system where it is stored; - by a new system when service standards so justify. That system would have to be extended to the individual or collective connections. (b) Eliminate localized pollution: - Andriantany canal, Lake Anosy and Lack Behoririka, if necessary building intercepting collectors; (c) Transport effluents from the urban area towards natural outlets. 11.1 Service Districts - District I: from Soanierana to Sixty-Seven Ha (Western Plain) - District II: city center - District III: watershed basin of the eastern valley - District IV: part of the Masay watershed basin - District V: Tsimbazaza watershed basin - District VI: area downstream of the plain - District VII: Lake Mandroseza - District VIII: valley occupied by the University - District IX: northern areas of Analamahitzy II.2 Constraints associated with existiam structures The waste water system of Anatanarivo essentially has two major structures: (1) A separate collecteo in the western plain (District I). This major structure has serious problems with water tightness. It connects with the Sixty-Seven Ha pumping station. (2) A set of combined system collectors in District II, which dump into the Andriantany.  38 II.3 General structure The Antananarivo sewerage has three distinct units (see map): - a main network that collects 90Z of effluents; - two secondary networks, each with its own purification facilities. Located downstream of the general collectors, the drainage facilities are comprised of: pumping stations, gravity activated backflows or pipelines, general pipeline, intake structures for discharge into the river or treatment, etc. There are three purification stations at present: - University and Ambohipo in the valley descending towards the Ikopa; - Analamahitsy on the southern slope of the Mamba. II.4 Execution phases One of the objectives of the master plan was to carry out only the strictly vital works and to select the structures giving the best price-service yield. Given the density threshold beyond which the collective equipment is indispensable (density threshold = 150 inhabitantsiha), the study on works phasing resulted in: (1) postponing the collective equipment for districts where the density thresholds had not been attained; (2) giving priority to areas where the cost/collected flow ratio was most favorable; (3) first carrying out the additional works in those districts alreauy having infrastructure, where sometimes minimal works can increase the return on the entire system; (4) requiring that construction permits take the foregoing into account, such that the density thresholds are not exceeded in the areas where collective sanitation is not planned. The works that cannot be put off are: - District I, in particular Lake Anosy; - District II; - Collector VI and all related structures (pumping and backflow) to the connections with the sewer on Andrianampoinimerina Avenue (formerly Avenue de la Reunion); - Collector for the northern industrial area.  39 The works in the eastern valley czn be considered next priority. All purification facilities can and should be postponed and would therefore be part of subsequent works phases. From a practical standpoint, this first phase would nevertheless make it possible to: (a) clean up of the most critical pollution points (Andriantany) and move that pollution into an area where the impact of the damage is limited (Ikopa); (b) connect all new expansion districts (southern industrial area, eastern valley, northern industrial area, etc.); (c) build all structures for the major urban restructuring works: railroad station neighborhood, Isotry neighborhood, all areas bordering on the Andriantany, etc. II.5 Cost of works The cost of the sewerage works envisaged under the master plan for the year 2000 is about FMG 4 billion. Of that total, two-thirds would be for tertiary equipment, i.e. the servicing of urban land, either in the current city area, owing to delays that have already occurred, or in the areas of future expansion. A comparison of this estimate with the population figures shows that the sewerage works would total FMG 4,500/inhabitant (FMG 6,500/inhabitant taking into account solely those served); the basic infrastructure would represent FMG, 1500/inhabitant, including purification. III. Flood control The report discussed the present and future hydrological conditions of the Ikopa and its affluents, as well as the constraints that these rivers pose for sanitation in the city. The main objective was that the city must: - protect itself against the risks of flooding from the river (dikes); - ensure storm drainage, above the dikes. Works priority was split into two phases: (a) Phase 1: - general strengthening of the existing dike on the right bank, without raising the height of the dike; - dredging of the bed between Tanjombato and Mahitsy; - construction of an eastern spillway at Tsiazompaniry.  40 IV. Action program for solid waste disposal until 1980 The proposed program did not envisage major modifications to current infrastructure, but sought to present a list of low-cost actions that would [? improvel the current situation and provide adequately for the disposal of waste until 1980. It can be summarized as follows: - establishment of collective multicellular containers in order to: - permit airtight equipment at the collection point - ensure more rapid loading of vehicles; - strengthening of the vehicle fleet, which needs to be totally replaced; - waste disposal through the establishment of a true controlled landfill, if possible west of the city; - rehabilitation of composting facilities and their development for reasonable yields and good quality 'f products (10,000 tons/year) Investments necessary by 1980 1. Collection - collection infrastructure: containers FMG 49,600,000 - vehicles FMG 83,600,000 2. Disposal - landfill FMG L9,000,000 - composting (10,000/year) FMG 33,845,000 - additional dumping FMG 9,000,000 FMG 195,045,000 C. Studies carried out by JIRAMA-OTUI A project agreement (Credit 1002-MAG of May 1980) was concluded between the Government of Madagascar and the World Bank (IDA) for sanitation works in Antananarivo. A studies contract was let to SECMO Madagascar in 1980, but was later cancelled. In 1982-the sanitation engineering studies for Antananarivo were contracted to JIRAMA-OTUI under Credit 1002-MAG, Contract No. 9369/82. The contract covered: - a study of [infralstructure and operations;  41 - study of electromechanical facilities; - study of electric and special equipment for the storm and waste water sanitation structures. The work also covered the entire study phase, from technical feasibility (1975) to price quotations from engineering firms (end 1982). This required additional design research involving: - an analysis of the urbanization of areas involved in the works under the first phase; - a review of unit costs and differential inflation with possible impact on financial calculations; - adaptations of the project in the wake of recent developments in technology; - study of overall arrangements for areas where the tertiary system was to be installed. These services were broken down into eight headings: 1. storm water pumping station 2. crossing structures (ouvrages de traversee) 3. storm reservoirs in the eastern valley and downstream retention basins 4. temporary pumping station for waste water 5. temporary main for waste water 6. pilot station at Ampasimbe 7. tertiary waste water structures 8. irrigation and drainage canals. An addendum to the contract was signed in June 1983, changing the contracting parties and adding several additional services. The following study headings were added: 9. raising the height of the dikes on the Mamba 10. discharge collector at Tsaralalana 11. collector 1I2 at Tsaralalana 12. collector at Highway RN4; 13. intercepcor VI. The contractor (JIRAMA) was also requested to provide procurement services (automotive spare parts, photocopier, drafting supplies, etc.) and logistical support. Execution until December 1984. With Addendum 1 the contract amount was FMG 118,766,745, including taxes.  42 The location of the works is on the attached maps. Execution of the Works I. Collector I, This collector, known as the "downstream network," was built in 1962. It runs along Andriantany canal and reaches the Sixty-Seven Ha pumping station (respective dimensions from upstream downstream: 0 700 - 0 900 - 0 1,000). II. Peripheral collector around Lake Anosy About the same time as the above collector, a collector running partially around Lake Anosy was built by the Bati-Service firm. This sewerage network collects effluents from the Mahamasina Nord watershed area and, through a storm spillway near the lake, connects with collector It. III. Partial rehabilitation of the sewerage system in the critical low-lying areas of Antananarivo A contract (No. 9449 FNDE/83) was let to SARA et Compagnie for the rehabilitation of the sewerage network in the critical low-lying areas of Antananarivo. The contract amount was FMG 29,135,158, including taxes, under Credit 1002-MAG. The operations were very localized and included: - construction of a siphoni culvert (dalot siphon) to the right of former Highway RNI at Anosibe; - repair of a storm spillway northwest of Lake Anosy and a rainwater pipe; - construction of covered street drains at Ho Chi Minh Square (Ampefiloha) with cross slabs of reinforced concrete under the paving. Execution took 75 days. IV. Contract No. 9519 Contract No. 9519 was concluded with the COLAS firm for rehabilitation of the existing sewerage network in Antananarivo. The works were supervised and monitored under Contract No. 9554 by SETEC International. SETEC also did a diagnostic study of the Isotry and Sixty-Seven Ha pumping stations, with training of staff from the Ministry of Public Works and the Municipality of Antananarivo Renivohitra.  43 The services provided by the contractor involved large-scale dredging (Lakes Anosy and Behoririka) and the rehabilitation or renovation of collectors of all types and all sizes with their related structures such as sidewalk hydrants, manholes plus necessary repairs to paved areas, ditches (demi-carniveaux) and sidewalks so that the water could be transported to the collectors. The works were broken down into lots and delimited by the following main roads: Lot 1 ( orthern district) - Rue Pasteur - Rue Razafinjohany Albert - RN4 - Rue Rasamimanana - Rue Razafindramanta - Rue Ramisaray - Rue Ravoninahitriniarivo - Dredging of Lake Behoririka Lot 2 (northeastern district) - Rue Razafindralambo Pierre - Rue Pasteur Rabezony Hans - Avenue de Bataillon Malagasy - Rue Gilbert Desvallon - Rue Docteur Moss - Rue Boudry Robert - Dredging of Andravoahangy canal Lot 3 (southwestern district) - Rue Charles Rabemananjara - Rue Ramamonjisoa - Rue Docteur Ranaivo - Rue Razafindranovona - Rue Rainibetsimisaraka - Rue L.P. Camo - Rue Radama I - Rue G6neral Ratsimandrava - Dredging of Lake Anosy. The amount of the contract was FMG 719,256,720, including taxes. Execution period: 12 months. A map showing the above streets is attached to this report.  44 Conclusion Over the last 30 years few sanitation works have been carried out, although the studies covered a long period. Moreover, both population growth and urbanization continued, causing problems with the current capacity of the existing networks and drainage to the outlets. The sanitation project, particularly for the plain and in part in .the urban area, has now been incorporated into the Antananarivo Plain Project, under which the works wiLl be carried out only in 1990, although reductions (allegements) of at least 50% are desirable for floods on both the plain and in the city center.* Lastly, the foregoing analysis of the sanitation system should be continued with a view to carrying out works, even if they are only on an ad hoc basis. Antananarivo, January 5, 1989 Is/ Anderson Rasoamaronaka Chief, Urban Development Office Encl.: Mpps *TN: As the original french is unclear, the English rendition is only approximate.  45 MADAGASCAR WATER AND SANITATION PROJECT Credit 1002-HAG Pro1ect Completion Report Part II: Project Review from Borrower's Perspective Solid Wastes  46 Democratic Aepublic of Madagascar Municipality of Antananarivo Renivohitra No. 4776/FVP/ANT/RV/DEL/A.l. Antananarivo, (date obliterated] President, Executive Committee Municipality of Antananarivo Renivohitra to President, International Development Association Attn. Mr. Buky Washington,. D.C. Subject: Water and Sanitation Project (Solid Wastes Component) Dear Sir: I have the honor to enclose the completion report for Part C (Solid *Wastes) of Project 1002-MAG (Antananarivo Water and Sanitation Project). Yours truly. Is/ [illegible] Vice President  47 Credit 1002-MAG Antananarivo Water and Sanitation Proiect Part C (Solid Wastes) Completion Report I. Introduction In addition to Parts A (Water Supply) and B (Drainage and Sewerage), Credit 1002-MAG had a third component called Part C involving the collection, disposal and treatment of solid household wastes. Prior to the project, the solid wastes collection and disposal system was reasonable in terms of the quantity collected but inadequate in terms of disposal and conditions of collection. People disposed of solid wastes in three types of containers: a small number of private bins, collective bins and numerous fixed concrete containers. The collective bins were often stolen and the concrete containers not well designed, so wastes were of en carelessly dumped in uncontrolled areas (outside collective bins, in illegal dumping areas, in drainage canals, etc.). Solid wastes were collected at 820 locations spread over 14 districts. Each district generally had two collection routes, the collection truck being full at the end of a route. Each district was served by one vehicle (6 to 8 ton truck running about 50 to 70 km per day and manned by two teams in shifts). Wastes were generalty collected at night and the same trucks used during the day for sewerage, roads and other works. At the time, 160 tons of household wastes were collected a day, meeting about 90% of needs. All urban areas with a population density of more than 25 inhabitants/ha were served. After collection, wastes were dumped 8 km from the city center on Toamasina Road on an area covering 15 ha. The landfill was not properly operated, as wastes were not covered periodically with earth. Nevertheless, burning, disinfestation, grading and compaction were performed regularly. Although in use since 1966, the area could still be used for a few more years. Small quantities of wastes were composted by facilities which included handling equipment, a hammermill and a composting area covering 450 m2 where refuse stacked in heaps was periodically turned over until the putrescibles decomposed. The hammermill theoretically had a capacity of 10,000 t/year but lack of presorting, screening and adequate handling equipment limited production to 600-800 t/year. Only 200-300 t/year of compost was sold because its quality was poor. Although the percentage of putrescibles was very high (75%), the quality was poor because of the presence of dangerous debris (scrap iron, glass, etc.) as a result of the lack of presorting equipment.  48 II. Project IdentiFication, Preparation and Appraisal Following the feasibility studies by OTH, project negotiations in December 1979 in Washington resulted in Appraisal Report No. 2266A-KAG of January 25, 1980 and the signature of a credit agreement between the World Bank and the Malagasy Government on May 8, 1980. According to the appraisal report, the solid wastes component would include: 1. The construction of additional collective dumping containers for household wastes in Antananarivo (80 containers of 600-liter capacity and 480 containers of 300-liter capacity). Each container would be of multicellular construction, each cell housing a plastic bin of 150-liter capacity; 2. The supply of 19 ordinary trucks of 6-8 tons capacity to reinforce and partially replace the fleet of vehicles used to collect solid wastes throughout the city; 3. The supply of heavy equipment (bulldozers, wheeled and tracked loaders, weigh bridge, 4 trucks) to make the existing dumping site a real "controlled" sanitary landfill and maintain it as such; 4. Improvement of the existing composting facility to enable it to produce 10,000 t/year of good quality compost. III. Execution Following the signature of the credit agreement on May 8, 1980, the following operations were carried out:  FVP/ANT/RV Share World Bank Already To Be Paid, Including Item InTotal (IlDA) Paid Excluding TU* TU I EquiPmezkt 23 dump trucks 375,687,750 277,585,171 49,099,828 49.002,750 3 tanker trucks 86,485,750 60,479,678 14,795,322 11.280,750 Rolling stock 263.904,990 208,864,470 23,299,125 55.040.520 Lightweight vehicles 191.366.525 137,478,589 28,927,086 53,887.936 Wheels 74,845,680 55,743,761 9.339,439 19,101,919 Insecticides 49,985,100 44,372,772 5 612.328 Standpipes 350,175,000 271,461,750 33,038,250 78,713,250 Meters 14,333,600 11,507,272 959,728 2.829,328 Metal containers 38,341,805 21,671,455 11,669,245 16,670,350 Equiptiient for treatment ol household wastes 586,814,731 456,326,811 53,946.968 130,487,920 Subtotal 2,031,940,931 1,545,491,729 63,825,150 166,792,069 417,014,723 I I SLUaMiH a) JIRAMA (OTUI) 133,900,000 56,027,498 51,959,488 b) SOMEAHi-SOGREAH (ON treatment plant) 33,151,500 22,908,225 10,243,273 c) OINIKA 77,786,000 24,630,516 53,155,484 ^