Argentina - Bahia Blanca Port Project

 Bahia Blanca port project Report No: ; Type: Report/Evaluation Memorandum ; Country: Argentina; Region: Latin America And Caribbean; Sector: Ports & Waterways; Major Sector: Transportation; ProjectID: P005944 Argentina: Bahia Blanca Port Project (Loan 2805-AR) The Project Completion Note (PCN) on the Argentina Bahia Blanca Port Project (Loan 2805- AR, approved in FY87), was prepared by the Latin American and Caribbean Regional Office. The loan, for US$50 million equivalent, was approved on May 5, 1987. It was canceled in June 1992, with US$42.8 million undisbursed, and closed on December 31, 1993. This was the Bank's first port project in Argentina, and was intended to help the country's efforts to expand exports, notably gain, by improving its main grain port. More specifically, the project's objectives were to: (a) facilitate grain exports by rehabilitating the handling and shipping facilities at Bahia Blanca port; and (b) improve the institutional capabilities of the Borrower's port sector. The project comprised: (i) reconstruction of a grain elevator; (ii) civil and maritime works; (iii) engineering studies; and (iv) technical assistance . The project did not achieve any of its intended objectives. The funds disbursed, amounting to some 15 percent of the loan, were used to pay for: (i) retroactive expenses on works and equipment and; (ii) engineering design for the reconstruction of the gain elevator. The project was prepared and approved at a time of great economic instability in the country, when the overall quality of the Bank's portfolio was poor, a situation which, ultimately, led to the cancellation in 1995 of about a quarter of the total lending approved during 1985-1989. This project was particularly handicapped by an overly long gestation period, followed by rushed processing after appraisal; by a 16-month delay in effectiveness; and by national elections, less than one year after implementation started, which led to a new Government with substantially different priorities. Grain-handling operations were privatized in the early 1990s. Since none of the project objectives were achieved, OED rates the project's outcome as unsatisfactory and sustainability of the investments as uncertain since it is unclear which, if any, of the equipment and works financed under this loan have been used by the private operator. OED rates the project's institutional development as negligible. Bank performance is rated as unsatisfactory because of its poor assessment of Borrower's ownership at appraisal and for failing to cancel the project earlier despite clear warnings by supervision missions. The PCN, issued two years after project closing, is of satisfactory quality. No audit is planned. ........... ...........