Independent Evaluation - Home > Search

Implementation Completion Report (ICR) Review - Roads Rehabilitation Project

1. Project Data:   
ES Date Posted:
Project Name:
Roads Rehabilitation Project
Project Costs(US $M)
 406  476.2
Loan/Credit (US $M)
 60  55.5
Sector, Major Sect.:
Central government administration, Roads & highways,
Law and justice and public administration; Transportation
Cofinancing (US $M)
 180  180
L/C Number:
Board Approval (FY)
Partners involved
Inter-American Development Bank (IDB) 
Closing Date
09/30/2000 09/30/2003
Prepared by: Reviewed by: Group Manager: Group:  
Kavita Mathur
Peter Nigel Freeman Alain A. Barbu OEDST

2. Project Objectives and Components:

a. Objectives
The overall objective of the project was to help the Government of Panama implement its Road Rehabilitation Program. The Bank loan is a part of a major funding from IDB. The specific objectives of the project were to: (a) increase competition in the road transport industry and provide the foundation for future regulatory reform;

(b) improve the management of the transport sector through the coordination of investments and the formulation of policies;
(c) continue strengthening the administration and maintenance of roads, through support to the Ministry of Public Works (MOP) in: (i) pavement management and (ii) private sector participation in maintenance;
(d) assist the MOP in removing the existing road maintenance backlog and preventing its future occurrence through the implementation of a well-coordinated rehabilitation and maintenance program; and
(e) reduce traffic congestion and provide more efficient, safer and reliable passenger transport service in the city of Panama and other major cities in the country.

b. Components
The project would finance a four year (1994 -1997) slice of the Government of Panama's (GOP) publicly financed Road program. The main components were:
(i) urban streets (actual US$ 102.1, Bank US$ 17.9): (a) street rehabilitation and/or widening and maintenance, intersection improvement, improved signalization and traffic management and (b) institutional reforms and regulatory changes in public road transport;
(ii) inter-urban roads (actual US$ 309.8, Bank US$ 29.8) covering the improvement, rehabilitation and maintenance of roads and bridges; his included the carrying out of sub-projects and a pilot maintenance program for inter-urban roads.
(iii) policy reform and institutional strengthening (actual US$ 34.3, Bank US$ 7.7) aimed at (a) reforming the regulatory policy of the for-hire road transport services, improving the overall transport sector planning and policy formulation, (c) training MOP staff to prepare projects for private sector implementation and to manage contracts, (d) preparing studies for follow-up activities.

c. Comments on Project Cost, Financing and Dates
The original loan closing date of September 2000 was extended twice. The first extension of 18 months (until March, 2002) was granted for: (i) the completion of the rehabilitation of the Volcan to Cerro Punta Road; (ii) safety investments on critical roads (black spot improvements and intersection, pedestrian bridges, and signing and marking in Panama City), (iii) the rehabilitation of priority streets in secondary cities; (iv) the extension of the pilot routine maintenance program; (iv) a training program, and (vi) implementation of a computerized infrastructure management system.
The second extension to September 30, 2003 was given at the Government’s request in order to complete the installation of the computerized accounting system as well as to complete the safety component activities and some road rehabilitation works, which were in execution. A third extension of 9 months was denied by the Bank mainly because of the age of the project.

3. Achievement of Relevant Objectives:

The objective to increase the competition in the road transport industry and to provide the foundation for future regulatory reform was partially achieved. A Land Transport Authority (ATTT) was created to plan, manage and regulate the land transport sector. The capacity of ATTT is fairly weak and it needs additional funding for institutional coordination and for the development of its capacity to adequately regulate the land transport sector. The implementation of the for-hire goods transport (which was deregulated) was not enforced.
The objective to improve the management of the transport sector through the coordination of investments and the formulation of policies was partially achieved. The Transport Sector Coordination Unit (TSCU) under the General Secretary of MOP was created and assigned the responsibility for the overall coordination of transport investments and policies. This unit was essentially non-operational since MOP had no statutory authority over the transport modes handled by other ministries. Subsequently, with the concessioning of railways and major ports, some of the TSCU key functions were taken over by the newly created ATTT. The project activities in this regard were less advanced than expected due to delays in establishing ATTT (only done by year 2000).

The objective to strengthen the administration and maintenance of roads, through support to the Ministry of Public Works (MOP) was partially achieved. The pavement management system was successfully set up while targets for contracting out maintenance were not achieved. A pavement management unit was created to assist MOP's planning and maintenance directorates through a computerized Pavement Management Information System (PMIS). MOP staff was trained in the use of Highway Design Maintenance (HDM) model. However, the road management system needs to be linked to all operational units of MOP especially the National Directorate of Maintenance (DINAMAN) and Program and Planning Directorate (DIPRODI). The project promoted private sector participation through the development of a pilot maintenance program with different contracting options. However, due to shortage of funds, MOP was unable to contract out maintenance to the private sector.

The objective to assist the MOP in removing the existing road maintenance backlog and preventing its future occurrence through the implementation of a well-coordinated rehabilitation and maintenance program was partially achieved. Physical targets were largely met. 215 km of inter-urban roads were rehabilitated (43 km with improved signalling). 10 km of the Capira-Sijalices section of the Pan-American Highway was widened. 18.7 km were maintained through the pilot routine maintenance program. To improve road maintenance funding, MOP prepared the Law for the creation of a Road Fund. This has yet to be approved.

The objective to reduce traffic congestion and provide more efficient, safer and reliable passenger transport service in the city of Panama and other major cities in the country was partially achieved. The project finance construction of pedestrian bridges, road sign programs in Panama City and other major towns, horizontal and vertical signals, and realignments to improve road safety and eliminate accident black spots. As these improvements are focused on specific locations, it is difficult to assign specific effects on overall traffic congestion or road safety. Regarding passenger transport, ATTT is responsible to improve passenger transport services. As mentioned earlier the capacity of ATTT is weak and needs to be strengthened.

The IDB considers the project implementation to have been fully successful.

4. Significant Outcomes/Impacts:

The environmental capacity was improved through the establishment of an Environmental Unit (EU). The EU is responsible for ensuring that the guidelines for environmental assessment of transport projects are complied with and the adverse environmental impacts of road projects are adequately mitigated.
  • The preparation and implementation of the Indigenous Peoples Development Plan (IPDP) has increased the awareness of the needs and rights of indigenous people while developing and implementing transport projects. Indigenous communities took full ownership of the IPDP and used this plan to leverage funds for implementation by indigenous initiation not only from Bank financed projects such as the Social Investment Fund (FIS) project but also from other donors and Government institutions.
  • The project assisted in the development of a Road Fund Law through the study for Financing Mechanism for Maintenance.

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

The quality at entry was poor. The proposed investments were geared more towards road rehabilitation with less emphasis on the policy and reform measures.
  • There were delays in project implementation due to: (a) insufficient as well as untimely release of counterpart funding; (b) high staff turnover due to changes in government administration; (c) bureaucratic and lengthy procurement and payment procedures; (d) unfamiliarity with World Bank Standard Bidding documents; and (e) delays in establishing an accounting and financial control system.
  • The project did not develop an appropriate M&E system to follow throughout the implementation period so as to measure outputs, outcomes and impacts, nor did it include initially any computerized project financial management and monitoring systems. Also, the Action Plan Matrix for Policy Reform and institutional Strengthening was not carefully monitored.
  • The overall financing for maintenance has decreased over the project's life and the number of kilometers of the national network maintained has accordingly decreased.
  • 6. Ratings:ICROED ReviewReason for Disagreement/Comments
    SatisfactoryModerately Satisfactory[The ICR's 4-point scale does not allow for a "Moderately Satisfactory" rating]. The project achieved its objectives only partially (see section 3).
    Institutional Dev.:
    LikelyNon-evaluableProgress was made in improving the capacity if MOP to plan and execute projects. However, the overall financing for routine and periodic maintenance has decreased over the projects life. The sustainability depends on the approval of the Law for the creation of a maintenance fund financed through user charges.
    Bank Performance:
    Borrower Perf.:
    Quality of ICR:

    7. Lessons of Broad Applicablity:

    An operational manual that describes a summary framework of the project design, policies, definitions, indicators, procurement procedures, guidelines and plans should be agreed with the Bank, prior to effectiveness. Also, the borrower should install a financial management system at the same time.
    • Detailed implementation action plans and specific measurable indicators and targets are essential monitoring tools to evaluate project outcome and impact. They are also “early warning devices” that can identify delays and issues early enough to propose timely remedial measures.
    • The Bank supervision missions should not just focus on the procurement of civil works, goods and consultants but should also provide technical support to local staff in implementing the policy reforms.
    • For successful implementation of IPDP, the beneficiary indigenous communities should have ownership during both the planning and implementation stage.

    8. Audit Recommended?  No


    9. Comments on Quality of ICR:


    © 2012 The World Bank Group, All Rights Reserved. Terms and Conditions