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Implementation Completion Report (ICR) Review - Urban Sector Rehab


  
1. Project Data:   
ES Date Posted:
08/29/2005   
PROJ ID:
P002758
Appraisal
Actual
Project Name:
Urban Sector Rehab
Project Costs(US $M)
 141.3  135.2
Country:
Tanzania
Loan/Credit (US $M)
 104.9  97.7
Sector, Major Sect.:
Central government administration, Sub-national government administration, Roads & highways, General water/sanitation/flood protection sector,
Law and justice and public administration; Law and justice and public administration; Transportation; Water sanitation and flood protection
Cofinancing (US $M)
 21.8  25.8
L/C Number:
C2867      
   
Board Approval (FY)
  96
Partners involved
KfW, Ireland and Netherlands 
Closing Date
06/30/2004 12/31/2004
         
Prepared by: Reviewed by: Group Manager: Group:  
Nilakshi M. De Silva
Roy Gilbert Alain A. Barbu OEDSG

2. Project Objectives and Components:

a. Objectives
To assist the Government of Tanzania to achieve sustainable economic development and urban poverty alleviation through (i) rehabilitation of basic infrastructure and expansion into high priority under-served areas in eight project towns, Dodoma and Dar es Salaam; and (ii) improvement of urban local government management and financing capacity.

b. Components
(A) Rehabilitation and expansion of infrastructure services (appraisal estimate US$83.4 million; actual cost US$93.1 million) in eight project towns and Dodoma, covering municipal infrastructure services such as roads, storm drains, sanitation, solid waste management, water supply and sewerage;

(B) Community-based infrastructure upgrading (appraisal estimate US$10.8 million; actual cost US$11.1 million) in Dar es Salaam including support for water supply services;
(C) Institutional strengthening ((appraisal estimate US$23.1 million; actual cost US$29.3 million) including training, technical assistance and provision of maintenance related goods and equipment to municipal councils;
(D) Studies (appraisal estimate US$2.8 million; actual cost US$1.8 million) for future project preparation.

c. Comments on Project Cost, Financing and Dates
Final project costs were 96% of appraisal estimates. The DCA was amended twice to reallocate funds under component B to include an emergency borehole drilling program during the 1997 drought, and to limit infrastructure upgrading to only two, rather than six, communities because of higher than expected community demand for tarmac roads. Most of the fall in the value of the IDA credit from US$105 million equivalent to US$98 million equivalent was due to the appreciation of the US dollar against the SDR at closing (in SDR, 98% of the credit was disbursed, leaving an undisbursed balance of US$1.7 million equivalent that was cancelled). About 81% of counterpart funding and 119% of cofinancing had been raised by project closing. The project got off to a slow start and closed six months later than scheduled, primarily because project funds were needed beyond the original closing date to support activities related to the preparation of the follow-on project.


3. Achievement of Relevant Objectives:

The project has contributed to economic development in project towns by developing basic infrastructure and these improved urban amenities have created an attractive environment for private sector investment. While project investments may not be the only contributory factor, the ICR reports a significant increase in startup of new income generating activities such as hotels, shopping centers and other service facilities, tourism has increased and various products are more readily available in the market. Also, satisfaction with services has lead to enhanced willingness among urban residents to pay other council dues, which augurs well for sustainability of project investments. While the project’s direct impact on poverty alleviation is less clear, several positive effects are reported. Social infrastructure development has improved access to essential services by the poor. The time spent each day on fetching water, mostly by women and children, fell from 2.5 hours on average to less than half an hour. In Dar es Salaam, the bore-hole drilling program has provided safe water to about 100,000 inhabitants in poor peri-urban areas. Finally, the opening of new enterprises and expansion of existing ones to take advantage of the new infrastructure, has lead to an increase in employment opportunities which is also expected to benefit the poor.
Specific Objectives:
(i) Achieved. Service delivery has improved in all project towns. In particular, road and drainage works have reduced vehicle operating costs, improved accessibility, safety and reduced maintenance costs. Improvements in water supply infrastructure have resulted in the percentage of people served with piped water increasing from 56% to 86% and the number of connections increasing by nearly 100%. Water is now available 24 hours in most towns and the amount of unaccountable water has decreased from 40% to 35%. Finally, improved sanitation, solid waste management, water supply and sewerage services are reported to have lead to a decrease in the incidence of communicable diseases, especially water-borne and skin diseases.
(ii) Achieved. Urban local government management and financing capacities have improved over the project period. A total of 1,508 persons, mainly municipal employees, were trained under this project, and the resulting benefits include timely decisions, quality and timely reports, better understanding of the planning process, quality of communications and improved labor relations. Technical assistance provided under the project has contributed to the implementation of a property valuation system which has more than doubled municipal revenues - increasing from Tshs 2 billion in 1996 to Tshs 7.5 billion in 2004. The project supported the creation of semi-autonomous Urban Water and Sewerage Authorities (UWSAs) which are managed efficiently. The financial capacity of UWSAs have also improved over the project period, with revenue increasing from Tshs 1.8 billion in 1996 to Tshs 10 billion in 2004. UWSAs in all project towns and Dodoma meet their maintenance and operating costs and in most cases generate surplus revenue for limited expansion works.

4. Significant Outcomes/Impacts:

A large number of basic infrastructure facilities were rehabilitated under the project, including 102km of roads with sideline drains, construction of 13 bus stands and 311 pit latrines in 188 schools and improvement of 8 solid waste dump sites. Under the water supply subcomponent, rehabilitation works include replacement of pipes and pumps, rehabilitation of treatment plants, construction of storage tanks and extension of the distribution system. Sewerage systems were rehabilitated and cleaned in seven towns and 14 sludge ponds and 26 treatment ponds have been constructed. In addition, under the community infrastructure component in Dar es Salaam 20.8 km of roads were rehabilitated, 12.9 sewer lines were rehabilitated/constructed and 28 emergency bore-holes and systems were installed.
  • The road, sanitation, solid waste, water and sewerage subcomponents exceeded their physical targets or met their targets at substantial cost savings. For example, road rehabilitation exceeded targets by 55%, the number of bus stands constructed exceeded targets by 100% and additional works were also performed under the water and sewerage components. The cost savings are attributed to the use of competitive bidding, appropriate packaging and proactive supervisions by project staff.
  • All the project infrastructure and equipment, such as vacuum tankers, septic tanks, skips, skip pads, skip loading vehicles and wheel loaders, are being maintained and are in good condition at project closing.
  • All eight project towns ranked at the top in the Environmental Health Competition of 2003 and 2004, which is conducted by the Ministry of Health and covers city, municipal and town councils. The evaluation is based on a matrix of about 21 criteria covering waste management, hygiene and sanitation, clean and safe water etc - all activities financed by the project.
  • All project subcomponents were implemented by the private sector, which has now become accepted practice, supported by the procurement laws of the country.
  • Property values in areas covered by the community infrastructure component have increased by almost 100% and property rents have doubled in both planned and unplanned settlements in the vicinity.

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

None.
6. Ratings:ICROED ReviewReason for Disagreement/Comments
Outcome:
SatisfactoryHighly SatisfactoryThe project achieved - and sometimes exceeded - its major objectives efficiently without major shortcomings.
Institutional Dev.:
SubstantialSubstantial
Sustainability:
LikelyLikely
Bank Performance:
SatisfactorySatisfactory
Borrower Perf.:
SatisfactorySatisfactory
Quality of ICR:
Satisfactory

7. Lessons of Broad Applicablity:

The project experience provides many lessons including:
  • The project demonstrates the importance of establishing base-line data for key output-impact indicators. This is particularly relevant for projects addressing poverty alleviation because, in the absence of baseline data on poverty, the project's impact is difficult to assess. Establishing baselines allows performance during implementation to be monitored with reference to the project's development effectiveness as well as allowing for better assessment of project outcome/impact at completion.
  • Implementation arrangements, with a project team under the guidance of a Steering Committee, contributed to the successful execution of this complex project. These arrangements allowed faster decision making. Having permanent secretaries of relevant ministries participate in the Steering Committee also helped to obtain timely approval of sectoral decisions. Setting up Project Support Units in each town also proved an effective means of local skills transfer and supervision.
  • High quality of works and improved services in the early stages can alter public perceptions and generate support for additional project implementation. The sequencing of project executions, which initially focused on small works with significant benefits, gained community support for the subsequent implementation of the project.
  • Bank’s supervision strategy for large infrastructure projects must be well structured, followed in a disciplined fashion and include exhaustive site visits. Status reports were obtained from Municipal councils and UWSAs well ahead of supervision missions. Also, supervision missions visited all project towns to consult directly with councils and UWSAs, which had the effect of heightened vigilance among contractors, consultants and other service providers.

8. Audit Recommended?  Yes

          Why?  To verify outcomes, learn more about the poverty impact of the project and to maximize learning from the successful implementation of this project for other similar projects.

9. Comments on Quality of ICR:

The ICR is well written. A great deal of information about project performance has been well organized and clearly presented, providing a good analysis of the project. The ICR has some shortcomings, however; it makes evaluative statements relating to, for example, improvements in traffic, public transport, tourism, economic activities, neighborhood security and the incidence communicable diseases without adequate evidence. The report is also too long, being more than twice the length recommended in the ICR guidelines.

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