China - Fujian Provincial Highway Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 12267-CRA STAFF APPRAISAL REPORT CHINA FUJIAN PROVINCIAL HIGHWAY PROJECT NOVEMBER 17, 1993 MICROGRAPHICS Report No: 12267 CHA Type: SAR Transport Operations Division China and Mongolia Department East Asia and Pacific Region This document has a restricted distribution and may be used by reipients only in the perfonnance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS (as of July 1993) Currency name = R.enminbi Currency unit = Yuan (Y) = 100 Fen $1.00 = Y 5.75 $0.174 = Y 1.0 FISCAL YEAR January 1 - December 31 WEIGHTS AND MEASURES 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 mile (mi) 1 square meter (m2) = 10.76 square feet (sq ft) I square kdlometer (kIm2) = 0.4 square miles (sq mi) 1 hectare (ha) = 0.01 (kin2) = 2.47 acres (ac) = 15 mu I mu = 666.7 sq m = 0.0667 ha 1 kilogram (kg) = 2.2046 pounds (lbs) 1 metric ton (m ton) = 2,204 pounds (Ibs) PRINCIPAL ABBREVIATIONS AND ACRONYMS USED ADT - Average Daily Traffic HPDI - Highway Planning and Design Institute CTF - Consultant Trust Funds HSRI - Highway Scientific Research Institute E&M Electrical & Mechanical ICB - Intemational Competitive Bidding EA - Environmental Assessment JST - Joint Supervision Team EAP - Environmental Action Plan LCB - Local Competitive Bidding EIRR - Economic Internal Rate of Return MOC - Ministry of Communications 8FYP - Eighth Five-Year Plan (1991-95) MOF - Ministry of Finance FHCEI - Fujian Highway Consulting NPV - Net Present Value Engineers, Inc. NTHS - National Trunk Highway System FP - Fujian Province PCC - Provincial Construction Commission FPECDO - Fujiian Provincial Expressway pcu - Passenger Car Unit Construction Directorate Office PMS - Pavement Management System FPEPB - Fujian Provincial Etvironmental PRC - People's Republic of China Protection Bureau PRCIS - Provincial Road Construction Industry FPEPRI - Fujian Provincial Environmental Study Protection Research Institute RAP - Resettlement Action Plan PPHAB - Fujian Provincial Highway RDB - Road Data Bank Administration Bureau RDP - Road Development Program FPTD - Fujian Provincial Transport RNIP - Road Network Improvement Progran Department 7FYP - Seventh Five-Year Plan (1986-90) FPTPDI - Fujian Provincial Transport Planning SAA - State Audit Administration and Design Institute SPC - State Planning Commission FYRR - First-Year Rate of Return TA - Techn.ical Assistance GOC - Government of China TCU - Technical Coordinating Unit GOVAI - Gross Output Value of Agriculture TOR - Terms of Reference and Industry vpd - Vehicle per day  r FOR OMCIL UR ONLY CHINA FUJIAN PROVINCIAL HIGHWAY PROJECT LoAN PROJECT SummRY Borrower: People's Republic of China Beefciary: Fujian Province Amount: $140 million equivalent Terms: 20 years, including S years of grace, at the Bank's standard variable interest rate Project Objectives: The project has been designed to (a) support the continued development of road infrastructure in Fujian Province to facilitate mobility and increase the efficiency of ro4d transport in the interest of stimulating economic activity; (b) develop an action plan for the strengthening of the provincial road construction industry; (c) assist in the development of institutional capabilities for transport planning and investment prioritization; and (d) ficilitate the transfer of highway construction and maintenance technology through staff training and the provision of equipment. Projet Dsripton: The project comprises: (a) the construction of the Xiamen- Quanzhou four-lane divided, access-controlled highway (81.4 kn); (b) a Road Network Improvement Ptogram (RN1P), including the upgraang (58.3 EIn) and paving (202.7 kn) of seven rural arterial roads; (c) construction supervision of the Xiamen-Quanzhou Highway and the civil works included in the RNIP; (d) purchase of equipment for highway operation and maintenance, road laboratories, a road data bank and a pavement management system, (e) a study of the provincial road construcdon industry; and (f) staff taning. Project Beneits: The main quantifiable benefits associated with development of the highway and the seven rural arterial roads include savings in vehicle operating costs, travel time, and road maintenance costs, and savings through reduction of taffic accidents. Benefits from the projects would accrue to road users, including the operators of freight and passenger transport services, enterprises and farmers, in the form of reduced vehicle operating costs. The Province would This document has a rstricted disttibution and may be used by tecipients only in the performance Iof their ofciaW duties. !ts contents may not otherwise be disclose without World Bank authorization.  -ii benefit from reduced cost of road maintenance, and a broad segment of the community would benefit from the reduction in traffic accidents. Benefits, particularly from the RNIP, would accrue from improved access to remote areas through fostering accelerated economic growth and greater mobility for social activities. Institutional benefits accrue from the involvement of local personnel in project preparation, requiring partcularly rigorous treatment of economic and environmental assessments, engineering design, technical specifications and construction practices. Such exposure will provide benefits far beyond the implementation peiod of the proposed project through the expence gained by the persomnnel involved. The specific attention given to the road construction industry in Fujian Province to encourage its transition to market-orientated operations is also an initiative with good potential for long-term benefits. Pisks: Based on the experience with ongoing highway projects, the main risk i implementation delay, paricularly for the highway component. Because of the difficult subsoil conditions along some of the highway alignment, the relatively high number of tunnels and bridges to be constructed and the extensive rock excavation involved, there are major risks of delay in the timely completion of the highway. Since the Fujian Province is a first-time borrower for a major Bank-financed highway project, the lack of experience in executing major Bank-financed highway projects adds an element of risk to smooth project implementation. However, project preparation has benefitted significantly from the Bank's previous expeience in similar highway projects in China, the participation of foreign experts in the design of the highway and the preparation of the bidding documents and technical specifications, the stringent prequalificaton of contractors, and the careful fonnulation of supervision to ensure regular monitoring and effective quality control.  -in - Nvjed Costs: jg EDrwgn Inta - ($ million) - A. Works 1. Hlighway 188.9 126.0 314.9 2. Electrical add Mechanical Works 1.3 5.2 6.5 3. Road Network Improvement Prograir. _U I2Q Subtotal 21= 13f.Q2 3A B. $Suoion 1. Highway 5.9 2.5 8.4 2. Road Network Improvement Program u -, .suibtotal L LI C. Egidpment 1. Highway Opeations and Maintenance 0.2 2.1 2.3 2. Labortories 0.1 0.4 0.5 3. Road Data Bank/Pavement Management System DA DA Q Subtotal D. Sdy & Trining 1. Road Consttion Industry 0.1 0.2 0.3 2. Staff Training Q v Subtotal Q LD Base7. 3 146.1U 3. fXSitngencie 1. Physical La 21.7 14.2 35.9 2. Price 15A S 4h2 Subtotal 111. 22 14A Land acquisition 24.6 0.0 24.6 Total 1 175. 7 S28. La Ten percent of Items A and Bl. 1k Identifiable ta and duties are about Y 106.4 million ($18.5 million). Taxes and duties would not be financed from the proceeds of the loan.  - iv - E1andag P1n: LQca1 Foreign oItal -- ($ million) Pwvincial government 304.4 35.7 340.1 Centrl government 48.7 - 48.7 IBRD - 140.0 140.0 Total Finacn =53. 175. 528 Estimated Disbursements: Bank For 19924 1995 k 122 1226 1222 19 -------------($ million) -- Annual 18 9 15 20 30 34 14 Cumulative 18 27 42 62 92 126 140 Poverty Categary: Not Applicable. Economic !Ytate of Retum: 25 percent  . v - 1 The Tisport Sector ................. . . . 1 A. Introduction . 1 B. Traffic .. . ... .. 1 C. T