China - Hebei Earthquake Rehabilitation Project

Report No. PID6713 Project Name China-Hebei Earthquake (+) Rehabilitation Project Region East Asia & Pacific Sector Urban Project ID CNPE56491 Borrower The People's Republic of China Implementing Agency Hebei Province (HP), Zhangjiakou Municipality and Zhangbei, Shangyi, Wanquan and Kangbao Counties. Date PID Prepared April 15, 1998 Appraisal Date February 28, 1998 Board Date May 29, 1998 Country and Sector Background China has recorded some of the most severe recorded earthquakes in the world. Since 1900, there have been 664 earthquakes with magnitude over 6 on the Richter Scale, of which 107 registered over magnitude 7, or around 30 percent of world earthquakes of that size. The death toll from earthquakes in China in the twentieth century exceeds 600,000, accounting for over 50 percent of the world total. Chinese earthquake specialists have predicted that, after a decade of relative calm, China is entering a period of high seismic activity that is likely to last for 12 to 15 years. At 11.50am on 10th January 1998 an earthquake of magnitude 6.2 on the Richter scale occurred on impoverished rural areas on Bashang plateau in Zhangjiakou Municipality. The epicenter was at the border of Zhangbei and Shangyi counties at latitude 41.10o and longitude 114.30o. The earthquake was followed by a large number of aftershocks, with a total of 481 being recorded in the week following the earthquake. Fifteen of these measured over 4.0 on the Richter scale. The earthquake caused extensive damage over an area of some 2,600 sq. kms (km2) covering Zhangbei, Shangyi and Kangbao counties on the plateau, and Wanquan county adjacent to the plateau. The affected area includes 37 townships, 585 administrative villages and 1,824 other villages with a population of 471,000. Of the above, 15 townships, 281 administrative villages and 696 other villages, containing a total population of 241,000 were seriously affected. Within these areas the intensity of the earthquake was VIII measured on the modified New China Intensity Scale (NCIS). There were 49 recorded deaths and 11,439 injuries. A total of 136,000 rooms collapsed and a further 264,000 rooms were damaged, leaving a total population of 44,000 homeless. Zhangjiakou Municipality (ZM) consists of the Bashang plateau in the north, bordering on Inner Mongolia, and the Baxia plain to the south. The total area of the municipality is 36,947 km2 , containing a total population of 4.4 million. There are four counties located on the Bashang plateau - Zhangbei, Guyuan, Kangbao and Shangyi, with a total area of 12,480 km2. The altitude of the plateau varies from 1,300 - 1,600 meters above sea level.  Average annual temperature on the plateau is 2.6 OC, and the lowest recorded temperature is -34.8 OC. The average length of frost free period is 110 days, with a minimum of 70 days. Water resources are scarce, with most of the supply coming from wells. The area supports dry land agriculture, with limited areas of irrigation using ground water. Soil conditions are poor and the economic base is weak, with per capita incomes of the order of Y 1,000 per year. Objectives The primary objective of this project is to assist in the restoration of economic and social activities following an earthquake in ZM in north-west Hebei Province, through the restoration of social and economic infrastructure and priority production facilities. A second objective is to strengthen the socio-economic situation in the area through enhancement of productive activities which would alleviate the extreme poverty. The economic and social benefits of rapid recovery in these impoverished counties would be considerable. The total population, which is homogeneous, to directly and equally benefit from the project is estimated at about 250,000, most of whom are poor. Description The project would support emergency reconstruction, repair and rehabilitation programs to be carried out in HP from about April 1998 through about September 2000. The components and their investment costs, including engineering and management costs, are in (a) Housing - $12.6 million: reconstruction and/or repair of about 15-20,000 houses; (b) Health Care - $1.6 million: (i) reconstruction and/or repair of about 26 health care facilities; and (ii) purchase of equipment; (c) Grain Storage - $2.8 million: reconstruction of, and/or repairs to, about 25,600m2 of grain storage facilities; (d) Water Conservancy - $5.4 million: (i) reconstruction of, and/or repairs to 130 drinking water facilities, including distribution networks; (ii) reconstruction of, and/or repairs to water conservancy facilities, e.g., 730 wells, buildings, canals, bridges, aqueducts, etc.; and (iii) repairs to the Friendship reservoir; (e) Education - $10.4 million: (i) reconstruction of about 600 schools; and (ii) purchase of school equipment; (f) Irrigation - $7.7 million: (i) installation of 4,500 shallow stone wells, 300 big dug wells and 200 tube wells ; (ii) installation of some 500 small sprinkler irrigation systems; and (g) Institutional Development - $0.1 million: technical assistance, training and support to Municipal, County and Township level agencies, particularly for building standard development, project management and monitoring. Financing The estimated cost of the reconstruction project, including engineering and management costs, is $41.1 million of which IDA finances some 70t through a credit of SDR 21.1 million under standard terms and conditions. Implementation The emergency rehabilitation project would be implemented in accordance with a detailed Operations Implementation Plan prepared by the -2 -  Municipality. ZMG has already established a Municipal Project Management Office, headed by the Vice Director of the Zhangjiakou Finance Bureau (ZFB), while project offices are to be established at the affected counties and townships level. Sub-project offices would be established in the affected sectors, e.g. health, education etc. Implementation would be carried out by line agencies including the county level construction bureaus. Given the magnitude of the investments required to be made in the affected areas over a limited time frame, the PMOs at the provincial and municipal levels, the project and sub-project offices at the county and township levels, may need to be strengthened, and the personnel skill mix adjusted to reflect the needs of the project. Sustainability The early establishment and maintenance of project and subproject offices should minimize the risk of delays in implementation. HPG has identified assured sources of revenue from which the necessary counterpart funding would be provided. Untimely or ineffective operation and maintenance arrangements with the local farmers for the cooperative irrigation facilities may endanger the sustainability of the facilities, but familiarity with these provisions in the area will mitigate this risk. Lessons Learned from Previous Bank Group Assistance The program approach, pioneered in the North China Earthquake Project and adopted successfully in the Inner Mongolia and Yunnan Earthquake Reconstruction Program (due to close in December 1998), is proposed for this project. In the North China Earthquake Project, the relevant lessons learned as highlighted in the Bank Group's Operations Evaluation Department (OED) Performance Audit Report dated June 27, 1996, included: (a) the importance of strong local leadership and local project management offices; (b) attention to the Borrower's views; (c) minimization of bottlenecks in the project's cash flow to accelerate urgent reconstruction activities; and (d) the benefits of using "fast track" project processing in the Bank Group. Poverty Category The project provides for targeted interventions in an officially designated poor area in China. The dry-land irrigation schemes aim at strengthening the socioeconomic conditions through increase in agricultural productivity. Environmental Aspects The emergency project is primarily focused on rehabilitating, restoring and preserving the environment and facilities damaged by the earthquake. The project has been rated at "B" and is expected to contribute to environmental improvement. No resettlement is involved in the project. Staff, employees and households of condemned structures have been rehoused in temporary structures located in open spaces in the vicinity of the damaged structures and would move back in after completion of construction or repair. Program Objective Category: Emergency Assistance Credit - 3 -  Contact Point: The InfoShop The World Bank 1818 H Street, N.W. Washington, D.C. 20433 Telephone No. (202)458 5454 Fax No. (202) 522 1500 Note: This is information on an evolving project. Certain activities and/or components may not be included in the final project. Processed by the InfoShop week ending August 14, 1998. - 4 -  Annex Because this is a Category B project, it may be required that the borrower prepare a separate EA report. If a separate EA report is required, once it is prepared and submitted to the Bank, in accordance with OP 4.01, Environmental Assessment, it will be filed as an annex to the Public Information Document (PID) . If no separate EA report is required, the PID will not contain an EA annex; the findings and recommendations of the EA will be reflected in the body of the PID.