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         Tuli block roads project

The Botswana Tuli Block Roads Project, supported by Loan 3248-BT for US$14.9 million equivalent, was approved in FY91. The loan was closed in FY96, one year earlier than scheduled, with an undisbursed amount of US$2.45 million reflecting cost savings. The Implementation Completion Report (ICR) was prepared by the Africa Regional Office with the borrower's report attached as Appendix B.

The objectives of the project were: (i) to provide road links necessary for the development and integration of the Selebi-Phikwe and the Tuli Block area; (ii) to strengthen the road maintenance capacity of the Ministry of Works' Roads Department (RD); and (iii) to improve road planning and programming capability. Project components included construction of the Sefophe-Martin’s Drift (134 km) and Bobonong-Lekkerpoet roads (66 km), both roads leading to the South African border, and consulting services for supervision of construction and a study of road maintenance organization.

The project’s physical and institutional development objectives were achieved; the roads were constructed and RD's maintenance planning was strengthened. However, the development objective of the roads was only partially achieved. The Government’s plan was to diversify the economy of the town of Selebi-Phikwe by linking it with South Africa and making it a center of agricultural trade for the Tuli Block area. While construction of the project roads meant that the local farmers were able to take advantage of the liberalized markets in South Africa, trade was mainly directly between the Tuli Block farms and markets in South Africa, not with Selebi-Phikwe. The lack of locally developed markets in Selebi-Phikwe has meant that local consumers have not benefited to the extent possible since most locally produced fruits and vegetables are reimported from South Africa. However, farmers have benefited from the all-weather roads. The reestimated economic rate of return for the project is 23 percent compared to the 15 percent estimated at appraisal, mostly due to higher than projected traffic on project roads, but the reestimated rate of return of 10 percent for the Bobonong road is low for a paved road. Plans to develop agriculture in the road influence area have not yet transpired and changes in agricultural production have not been monitored. Road user charges were not increased, as covenanted, mainly due to Government's policy to adopt a regional system of road user charges within the South African Customs Union. However, budgetary funding of road maintenance has been adequate and Government is now considering setting up an autonomous Road Administration with its own road fund.

OED concurs with the ICR in rating the project’s outcome as satisfactory and its sustainability as likely. Roads are likely to be adequately maintained. Agricultural production has increased with little input from Government and is likely to be sustained as long as the South African market remains open. OED also concurs with the ICR that institutional development objectives were substantially achieved but has rated overall institutional development as moderate because the project, while helping to improve maintenance planning and programming, did not otherwise have a major impact on institutions in the road sector during project implementation. The Bank’s performance is rated as satisfactory despite a lapse in supervising compliance with covenants relating to road user charges and auditing of project accounts during the last half of project implementation.

A major lesson is that, at appraisal, agreement should be reached on monitoring the impact of projects throughout implementation using well defined monitorable indicators to assess the magnitude of benefits and their distribution among beneficiaries (for example, large or small farmers), so as to detect early on whether projected benefits are being realized.

The ICR is comprehensive and is rated as satisfactory.

No audit is planned.

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