Burkina Faso - Ougadougou Water Supply Engineering Credit

 ICRR 10334 Report Number : ICRR10334 ICR Review Operations Evaluation Department 1. Project Data : OEDID : OEDID: C2519 Project ID : P000310 Project Name : Ougadougou Water Supply Engineering Credit Country : Burkina Faso Sector : Urban Water Supply L/C Number : CR 2519-BUR Partners involved : Agence Francaise de Developpement (AFD) Prepared by : Klas B. Ringskog, OEDST Reviewed by : Hernan Levy Group Manager : Gregory K Ingram Date Posted : 08/18/1999 2. Project Objectives, Financing, Costs and Components : Objectives : The objectives were to (i) finance studies and technical assistance needed for the preparation of the future Ougagougou Water Supply Project (OWSP); (ii) lay the groundwork to improve the quality at entry of this project and for its successful implementation; and (iii) test the commitment and ownership of the government and the capacity of the Office National de l'Eau et de l'Assainissement (ONEA) to improve water sector management before making further massive investments . Components : The project comprised (a) the design and preparation of final bidding documents for the OWSP; (b) the assessment of the future environmental impact of the OWSP, comprising a mitigation plan, a resettlement plan, and a review of riparian issues related to the dam construction; (c) the establishment of a project unit within ONEA responsible for implementation of water supply projects; and (d) the provision of technical assistance, training, office equipment and vehicles to strengthen the capacity of ONEA in project design and management . Costs: Total project costs were SDR 4.70 million ( US$ 7.10 million) as compared to the appraisal estimate of SDR 4.76 million. Financing : An IDA credit financed US$ 4.20 million and AFD financed the balance of US$ 2.9 million. The credit was approved in FY93 and closed on March 31, 1998, 21 months behind schedule. 3. Achievement of Relevant Objectives : The objective of preparing the engineering studies were satisfactorily completed in 1997, including final design and bidding documents for the dam and transmission main under the OWSP, the final design and bidding documents for the water treatment plant and the distribution network; and an environmental assessment and resettlement plan for the 2,500 persons to be displaced as well as a mitigation plan . These outputs are being used to prepare the OWSP for which appraisal is planned in FY 2000. In contrast, the Institutional Strengthening objective to test the commitment and ownership of the Government and the capacity of ONEA to improve water sector management before making further substantial investment, was not achieved. 4. Significant Achievements : The necessary engineering studies were completed within the cost and time budget . 5. Significant Shortcomings : The Institutional Strengthening under the project was supported by a Performance Contract to improve ONEA . However, the Government failed to honor the performance contract starting in 1995, which led to a decline in ONEA's financial situation. An evaluation of the technical assistance provided by GTZ has confirmed the shortfalls of the Performance Contract strategy . Only a sound institutional arrangement with a private operator can offer sustained improvements in ONEA's institutional and financial performance . 6. Ratings : ICR OED Review Reason for Disagreement /Comments Outcome : Unsatisfactory Unsatisfactory  Institutional Dev .: Partial Negligible OED institutional development rating is prompted by the fact that ONEA's institutional and financial performance continue to be weak. Sustainability : Unlikely Unlikely Bank Performance : Deficient Unsatisfactory The ICR and OED ratings are equivalent Borrower Perf .: Deficient Unsatisfactory The ICR and OED raings are equivalent Quality of ICR : Satisfactory 7. Lessons of Broad Applicability : Long-term technical assistance does not guarantee long -term institutional strengthening of a public water supply company. Lasting improvements require an enabling framework and contractual incentives for a private operator to improve efficiency of financial performance . 8. Audit Recommended? Yes No 9. Comments on Quality of ICR : Satisfactory