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Implementation Completion Report (ICR) Review - Second Transport Sector Project


  
1. Project Data:   
ES Date Posted:
07/26/2001   
PROJ ID:
P000530
Appraisal
Actual
Project Name:
Second Transport Sector Project
Project Costs(US $M)
 121.4  Not Available
Country:
Chad
Loan/Credit (US $M)
 37  50.1
Sector, Major Sect.:
Highways,
Transportation
Cofinancing (US $M)
 47.1  Not Available
L/C Number:
C2520      
   
Board Approval (FY)
  93
Partners involved
European Development Fund (EDF), French Cooperation Agency (CFD), BDEAC, OPEC Fund 
Closing Date
12/31/1998 06/30/2000
         
Prepared by: Reviewed by: Group Manager: Group:  
Kavita Mathur
Christopher D. Gerrard Alain A. Barbu OEDST

2. Project Objectives and Components:

a. Objectives
The objectives of the project were to:

  • help stimulate industrial and agricultural development and regional trade through consolidated improvements in transport sector efficiency, with a focus on continued reductions in vehicle operating costs and improvement in the efficiency of the transport market;
  • continue to improve public investment efficiency, transparency and budgetary management;
  • improve internal resource mobilization to meet the long-term need for routine road maintenance;
  • promote private sector involvement in road maintenance and strengthen the road transport industry; and
  • streamline and continue to improve public administration of the sector.

b. Components
Physical Component: (i) periodic and routine maintenance of the priority road network of 4760 km; (ii) rehabilitation of about 300 km of secondary roads; and (iii) rehabilitation of bridges and culverts . Institutional Strengthening Component: (i) consulting services for civil works design and supervision, soil research studies and testing, and technical and financial audits; (ii) consulting services for promoting private small and medium construction contractors and small truckers; (iii) technical assistance and training for transport sector institutions; (iv) implementation of regional integration action plan; and (v) implementation of transport sector environmental plan.
Revised Components
The Bridge and Culvert Rehabilitation sub-component was dropped. The institutional strengthening component was reoriented to: (i) address head-on the transport sector policy problems, both within and outside the sector, (ii) establish the requirements and action plans to improve financial and technical management of key sector institutions; (iii) develop more appropriate approaches to road network management; and (iv) carry out a major study to define a coherent national transport strategy.

c. Comments on Project Cost, Financing and Dates
At appraisal the Bank approved US$37 million. To cope with the January 1995 currency devaluation, the Bank in March 1995 approved a supplemental credit of US$ 12.7 million . The total project cost and cofinancing at project closing are not available in the ICR. The project closed on June 30, 2000, eighteen months after the original closing date.


3. Achievement of Relevant Objectives:

Physical targets for routine and periodic maintenance were largely met.
  • Periodic maintenance was carried out on 1,140 km.
  • Rehabilitation was done on 353 km of secondary roads.
  • The efficiency of the project is substantial. The total physical investment resulted in an IRR of 39.8%. However, the net present value for some rehabilitation works was negative and overall IRR was 11%.
Most of the institutional objectives were achieved.
  • Management and accounting systems in CAER (Compte Autonome d'Entretien Routier), BNF (Bureau National de Fret) and CISCP (Coordination Unit) were introduced.
  • The Road Agency, OFNAR (Office National des Routes ) was restructured into National Road Maintenance Company SNER (Societe Nationale d'Entretien Routier), managed under private sector management principles.
  • The National Flag Carrier, Air Tchad was liquidated in 1999. Technical assistance was provided to identify suitable air transport operators to take over Chad's traffic rights.
  • In order meet the long-term needs for road maintenance, the government in 1994 established CAER, a road fund outside the regular budget. CAER had limited success in providing funds for maintenance and in 1998 the resources form CAER were reintegrated into the government budget. However, the CAER was replaced by FER (Fonds d'Entretien Routier) in 2000. The design of the new second-generation road fund has to a large extent remedied the weaknesses of CAER.
  • The project was successful in creating an enabling environment for private road contractors and promoting private sector involvement in road maintenance. Extensive training program was carried out. Force account is no longer being used for road rehabilitation and maintenance.
  • Basic procedures for environmental assessment for road projects were introduced. An Environmental Unit within the Roads Directorate was established.

4. Significant Outcomes/Impacts:

The significant impacts of the project are:
  • It facilitated the creation of a second-generation road fund FER to provide sufficient funds for road maintenance.
  • It promoted the use of private contractors for road maintenance and introduced the concept of performance-based road maintenance contracts.

  • 5. Significant Shortcomings (include non-compliance with safeguard features):

    Quality at entry was weak as there was no overall strategic plan that would provide the basis for rational planning and management.
    1. The technical designs for the physical road investment components were inadequate and underestimated the costs. During the implementation this was rectified, leading however, to higher real costs.
    2. The execution of road maintenance was frequently interrupted for long periods due to lack of funding.
    3. At the mid-term review, technical assistance to MTPTHU's Directorate General and Roads Directorate was terminated without establishing the transition arrangements.
    6. Ratings:ICROED ReviewReason for Disagreement/Comments
    Outcome:
    SatisfactorySatisfactory
    Institutional Dev.:
    SubstantialSubstantial
    Sustainability:
    LikelyLikely
    Bank Performance:
    SatisfactorySatisfactory
    Borrower Perf.:
    SatisfactorySatisfactory
    Quality of ICR:
    Satisfactory

    7. Lessons of Broad Applicablity:

    The ICR identifies the following lessons of broad applicability:
      (i) Technical assistance and consulting services should mainly provide methods and tools to achieve performance results. They should be limited to specific tasks for which local capacity is not available.
      (ii) There is a need for close coordination within the Bank and between the Bank and the IMF on the formulation and implementation of sector specific policies.
      (iii) Political commitment in the form of a legislation is crucial to establish a Road Fund that is independent and operates at arms length from the government, and that has secure maintenance funding.
      (iv) Significant social benefits accrue from low-volume roads that are not easily measurable by means of traditional economic evaluations.

    8. Audit Recommended?  No

              Why?  

    9. Comments on Quality of ICR:

    The quality of ICR is satisfactory. The cost tables in Annex 2 are incomplete: figures for actual total project costs and the government and cofinanciers contribution are not available.

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