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Implementation Completion Report (ICR) Review - Mekong Transport And Flood Protection Project


  
1. Project Data:   
ICR Review Date Posted:
03/24/2014   
Country:
Vietnam
PROJ ID:
P042927
Appraisal
Actual
Project Name:
Mekong Transport And Flood Protection Project
Project Costs(US $M)
 143.91  218.49
L/C Number:
C3448
Loan/Credit (US $M)
 110.00  142.97
Sector Board:
Transport
Cofinancing (US $M)
   
Cofinanciers:
Board Approval Date
  12/20/2000
 
 
Closing Date
06/30/2006 06/30/2011
Sector(s):
Roads and highways (80%), Flood protection (14%), Central government administration (6%)
Theme(s):
Rural services and infrastructure (50% - P) Infrastructure services for private sector development (50% - P)
         
Prepared by: Reviewed by: ICR Review Coordinator: Group:
Peter Nigel Freeman
Robert Mark Lacey Christopher David Nelson IEGPS1

2. Project Objectives and Components:

a. Objectives:

According to the Development Credit Agreement (DCA, Schedule 2) the project aimed to assist the Borrower to: i) complete the rehabilitation of National Highway 1 (NH1) to improve the main road network, ii) include increased protection for certain flood-prone segments; and iii) improve the efficiency of the regional (rural) transport network in the Mekong Delta.

The project's development objectives (PDO) as stated in the Project Appraisal Document (PAD) (page 2): to stimulate the commercial use of an improved transportation network, improve access to rural areas by connecting them to the main trade and movement corridors, and ensure permanent access to regular flood-prone areas.

This review is based on the statement of objectives in the DCA.

Additional financing in the amount of US$25 million was approved on June 20, 2007 in order to cover a financing gap caused by escalating costs and extension of the project to include the construction of the Ganh Hao II Bridge (GH2). The project development objectives were not changed.

b. Were the project objectives/key associated outcome targets revised during implementation?
No

c. Components:
The project had four components:

Component 1: Upgrading 180 km of Highway 1 between Can Tho and Ca Mau in the Mekong Delta. (PAD Estimate $76.21 million; ICR Actual $130.93 million) This component included the rehabilitation of the existing carriageway as well as the rehabilitation or replacement of culverts and 21 bridges (with less than 25 meter span) to accommodate 30 ton gross vehicle weight (GVW) vehicles. The Japan Bank for International Cooperation (JBIC) committed support for the rehabilitation of longer bridges through parallel financing.

Component 2: Upgrading 182 km of national and provincial roads in the extended Mekong Delta transport system covering 18 provinces. (PAD Estimate $18.09 million; ICR Actual $49.79 million) The sections to be upgraded included: (i) three segments of NH1 between Ca Mau and Nam Can, totaling 54 km; and (ii) 12 sections of national and provincial roads, totaling 128 kilometers. The latter activity, targeting various national and provincial roads, was referred to as the Mekong Delta Network Improvement (MDNI) sub-component.

Component 3: Protecting an aggregate of 38.8 km of 17 flood-prone sections of Highway I between Dong Ha and Quang Ngai in the central coastal area. (PAD Estimate $20.24 million; ICR Actual $18.89 million) This component was to protect selected sections against flooding events up to a once every 10 years severity level through grade raises and adequate cross drainage.

Component 4: Strengthening institutions. (PAD Estimate $7.01 million; ICR Actual $18.88 million) This component included five technical assistance (TA) interventions: (i) strengthening of Ministry of Transport (MoT) management, including the planning, monitoring, and organizational functions, as well as the provision of information technology (IT) resources; (ii) implementation of new road and bridge design standards; (iii) enhancement of road safety audit, blackspot treatment, and heavy traffic management—complemented by the physical upgrading of 12 hazardous locations and the supply of 10 mobile scales and three permanent weigh stations; (iv) final design of a future road maintenance project; and (v) project management support to the MoT implementing agency, Project Management Unit 1 (PMU1).

Revised Components and Other Significant Changes. The most significant changes during implementation were: (i) six new bridges on the Ca Mau –Nam Can section of NH1; (ii) changes to institutional strengthening priorities; (iii) cancellation of mobile scales and permanent weigh stations; and (iv) revised scope of the blackspot improvement program.

When the additional financing was approved, the following three indicators were added to the results framework in order to reflect the inclusion of the GH2 Bridge investment in Ca Mau city under the MTFP Additional Financing credit: (i) reduction in travel time by bus between Bac Lieu and Dam Cung; (ii) number of accidents per 100 million vehicle-km on GH2 Bridge; and (iii) fatalities per 100 million vehicle-km on GH2 Bridge.

d. Comments on Project Cost, Financing, Borrower Contribution, and Dates
Project Cost. The total project cost at appraisal was estimated at US$ 143.91 million. At completion the final cost was US$ 218.49 million. Variation orders (VOs) of approximately US$23 million associated with the project‘s five major international competitive bidding (ICB) contracts required a reallocation of proceeds from the unallocated category of the original credit. The VOs reflected changes in design standards, increased quantities, and revised unit prices generated by revisions to the road alignment, unforeseen changes in construction site conditions, higher than expected traffic levels, and input price inflation.

Financing

IDA Credit
The original credit was US$ 110 million, with US$ 25 million added through additional financing. After cancellations and allowing for depreciation of the VND against the USD the final amount disbursed was US$ 142.97 million.

Japan Bank for International Development (JBIC) was to provide US$ 33.92 million for bridge construction through parallel financing (ICR page 4). The final figure for this activity was US$ 75.52 million.

Credit cancellation. In May 2011 funds from both the original credit and the additional financing, totaling SDR 8.5 million (US$ 13.5 million equivalent) and SDR 3.4 million (US$ 5.5 million equivalent), respectively, were cancelled. This included technical assistance for strengthening Ministry of Transport (MoT) management capacity. Towards the end of the project the MoT requested cancellation of mobile scales and permanent weigh stations because it first wanted to complete a detailed heavy load control master plan.

Dates. The original credit‘s closing date was extended three times for a total of five years: (i) for 18 months (through December 2007); (ii) for 36 months (through December 2010, coterminous with the closing date for the additional financing credit); and (iii) a final period of six months (through June 2011). The additional financing credit was extended once for six months (through June 2011). The delays had several root causes,including (i) the timing of IDA‘s handling of key decisions regarding eligibility of MoT dependent state owned enterprises; (ii) the Borrower‘s inability to meet counterpart funding requirements to finance resettlement activities; (iii) insufficient mobilization of working capital by the primary contractors on the National Highway 1 civil works; and (iv) lack of proactivity by the project management unit (PMU1).


3. Relevance of Objectives & Design:

a. Relevance of Objectives:
High
The project's objectives are relevant to Vietnam‘s development goals. They are consistent with the current Country Partnership Strategy (CPS) for the Fiscal Years 2012-2016 and the former CPS for the Fiscal Years 2007-2011, particularly in respect of contributing to the country’s foreign trade and competitiveness, through the creation of a more reliable transport network.

The project also promoted social inclusion by expanding the network regionally to reach the poor, and rural communities. This is relevant to current government policy as expressed in its Transport Sector Strategy. The Authorities observed that traffic growth has outpaced road rehabilitation and more substantial investments were needed to reverse that trend, reduce congestion, segregate road traffic, and upgrade national road standards. Moreover, there was a strong need to extend transport connectivity to rural populations in the Mekong Delta, ensuring permanent access with the seasonally flooded central coastal region.

b. Relevance of Design:
Modest
While the statement of objectives was clear and measurable, two of the three objectives were output rather than outcome oriented. The definition of the PDO did not reflect all project components. In particular it largely excluded the goals pursued under institutional strengthening. As a result, there was no explicit causal chain between these goals and the proposed technical assistance activities, such as Ministry of Transport management strengthening or the need for official adoption of updated road and bridge standards. The sequencing in the implementation of the activities, however, was clear.


4. Achievement of Objectives (Efficacy) :


Complete the rehabilitation of National Highway 1. Substantial
Outputs:
i) Upgrading 234 km of National Highway 1 (NH1) in the Mekong Delta has improved connectivity and thus competitiveness for the towns and cities along the road segment to the larger markets of Can Tho, Ho Chi Min City (HCMC), and beyond. In terms of smoothness the rehabilitated roads show an improved International Roughness Index (IFI) from 6-8 down to 3, while NH1 was upgraded from 7 to 7.5 m standard to 12 m standard.
ii) Upgraded guidelines were completed for road safety auditing and blackspot removals and staff training took place. The implementation of an axle load control program with provision of 10 mobile scales and installation of three permanent way stations was cancelled at the request of the Government, but guidelines for a road safety audit were adopted.
iii) Technical assistance intended to strengthen MoT‘s long-term strategy, planning, staffing, and management functions (including the development and roll-out of an appropriate IT architecture) was cancelled. However, the funds were utilized with Bank agreement for a feasibility study of a bypass at Ca Mau and widening of the NH1 between Can Tho and Phung Hiep.
iv) As a result of the road safety audit, the Vietnam Roads Administration proactively began to select blackspots for elimination. Two of the 14 locations were funded by the credit and 12 through other sources. No data are yet available to show whether accidents have been reduced as a result of these activities.
v) From a quality assurance and engineering perspective, final inspection of the fully completed NH1 road sections in both the Mekong Delta and the central coastal area concluded that the quality of construction was very good. Furthermore, MoT‘s own internal evaluation considered the quality of works and hand-over process to local road management authorities "exemplary."
Outcomes:
i) The volume of freight conveyed in the corridor increased from 7.2 million tons in 2005, to 11.5 million tons in 2010, well exceeding the target of 9.7 million tons.
ii) Freight tariffs have shown a steeper than expected real price decrease between 2005 and 2010 of 22.2 percent for rice shipments, 24.6 percent for petroleum shipments and 19 percent for cement shipments. The target was an overall decrease of three percent in real terms. This has likely been exceeded, but no evidence is provided as to the extent to which market forces influenced these prices.
iii) It was expected that travel time saving between Can Tho and Ca Mau by bus would be 0.4 hours. The actual saving was, however, one hour or three times better. For all traffic a reduction of 66 percent in time saved was anticipated. In the event the time saving was 68 percent which was slightly better than the target.
iv) Because the Government decided to defer the axle-load control program until after a detailed master plan of the country's entire network had been completed, this item was cancelled and thus there was no improvement in the incidence of vehicle overloading.

Improved efficiency of rural transport network. Modest
Outputs:
Some 98 km out of a planned 128 km rehabilitation of rural national and provincial roads in the Mekong Delta network were completed (76 percent), with improved riding quality (from IRI 8 to IRI 4.5). The shortfall was due to delays and a funding gap. Despite additional finance, not all planned roads could be covered by project closure.
Outcomes:
Connectivity was improved by linking the southern town of Nam Can to the NH1. Travel time on this route was reduced by 68 percent relative to the baseline meeting the target. Time on other routes was not measured and so there was no evidence concerning time savings, although some savings and improved efficiency were likely.

Increased protection from flood prone road sections. Substantial
Outputs:
The flood resiliency of nearly 40 kilometers of NH1 in central Vietnam was improved.
Outcomes:
The duration of road closures in four flood prone locations was reduced from 11 hours to 5 hours (exceeding the target) by project closure. Although this did not eliminate the problem, it reduced the risk and occurrence substantially.

5. Efficiency:

Modest
An ex-post economic cost-benefit analysis was carried out. The returns for the upgrading of 180 km of NH1 between Can Tho and Ca Mau, and 54 km of NH1 between Ca Mau and Nam Can accounted for 83 percent of total project costs at completion and 73 percent at the time of appraisal. A similar analytical approach to that used at appraisal was adopted. Net benefit and cost calculations for the ICR economic analysis were based on: (i) pre and post project historical traffic measurements, (ii) updated traffic forecasts over an 18 year horizon (through 2028), (iii) updated benefit and cost parameter unit values, and (iv) final project implementation costs (including counterpart and co-financed funds) and construction schedules. The resulting Economic Rate of Return (ERR) estimates, by road section, are presented in the ICR as follows:

The ICR stage ERR is estimated to be 16.8 percent and 41.2 percent, respectively, for the Can Tho-Ca Mau and the (54 km) Ca Mau-Nam Can sections of NH1. Updated return estimates are roughly in line with appraisal estimates in the first road section (14.6 percent), but significantly higher than appraisal estimates in the second (smaller) road section (21 percent). The large difference in estimated returns for the upgrading of the Ca Mau-Nam Can section at completion relative to appraisal is due to markedly better historical travel time performance post-completion: while it was estimated at appraisal that buses would make the 54 km journey in 120 minutes by the first year of operations, the actual travel time observed was 67 minutes, or almost a full hour faster than originally modeled. It is concluded that investments made in both sections remain economically justified.

Implementation, however, took nearly twice as long as originally envisaged (five additional years) and required additional financing in order to achieve its expected outputs (ICR, page 16), Although the project scope was increased, this accounts for only part of the cost overrun. The cost overruns for the rural network led to insufficient funding to undertake the full extent of improvements originally planned. Key issues affecting the delays were uncertainties about the eligibility of the participation of state owned enterprises (SOEs), lack of coordination between the Ministry of Transport and the Ministry of Finance regarding budgeting and appropriation of resettlement funding, and weak project management.

a. If available, enter the Economic Rate of Return (ERR)/Financial Rate of Return at appraisal and the re-estimated value at evaluation:


Rate Available?
Point Value
Coverage/Scope*
Appraisal:
Yes
15.8%
78%
ICR estimate:
Yes
23.5%
83%

* Refers to percent of total project cost for which ERR/FRR was calculated

6. Outcome:

The objectives were highly relevant to the country‘s development priorities, though the relevance of the project design was modest. Of the three sub-objectives two were substantially achieved and one modestly. Road network reliability was improved by reducing NH1 closures through flood-prone areas. The economic rate of return of the investments was above the reference 12 percent opportunity cost of capital and better than forecast at appraisal because of higher than expected traffic growth. Nevertheless, the implementation horizon was nearly twice as long as originally envisaged and required additional financing which proved insufficient to achieve all the expected outputs. Many of the project beneficiaries - especially local populations living in and around the NH1 - could have received the investment benefits five years earlier with more efficient implementation.

a. Outcome Rating: Moderately Satisfactory

7. Rationale for Risk to Development Outcome Rating:


Political risk: Negligible to low. The assets developed under the project, particularly those along National Highway 1 will continue to retain strategic importance for the government as NH1 not only represents Vietnam's highway backbone, but is the primary thoroughfare connecting greater HCMC with the southern provinces.
Technical risk: Moderate. NH1 and Mekong Delta Network Improvement rehabilitation works continue to perform satisfactorily after several years of operation, and routine maintenance has been carried out in most of the early works segments (ICR page 17 ). However, in rapidly growing regions like the Mekong Delta there is a risk that road travel demand may grow faster than anticipated, causing higher than expected congestion and accident rates, thereby increasing maintenance requirements and leading project investments to reach capacity sooner. A further risk stems from the fact that the axle load reforms had not been introduced by project closure.
Financial risk: Moderate. There is no clear indication in the ICR of overall maintenance requirements or whether there would be sufficient funding to meet them. This risk is partially mitigated by continued Bank engagement through the proposed Vietnam Road Asset Management Program, which is expected to support Vietnam's road management strategy for prioritization of preventive maintenance.

a. Risk to Development Outcome Rating: Moderate

8. Assessment of Bank Performance:

a. Quality at entry:
There was no quality at entry assessment rating. A strategic approach should have been adopted and agreed with the Borrower on the issue of the participation in bidding by state owned enterprises (SOEs), which would have avoided serious delays later. Quality at entry could also have been strengthened through more robust risk mitigation measures, since it was clear that the borrower's capacity was inadequate. The preparation of institutional strengthening activities could have been more closely aligned with government sector priorities to foster greater ownership of outcomes. Despite some training activities the Borrower was not ready to handle the financial management requirements of the Bank. The number of households affected by the project was underestimated. Efforts by the Bank team did, however, ensure early completion of many preparation tasks, including the readiness of detailed engineering designs, support for the setup of a more transparent compensation and reporting mechanism by the implementing agency and training of PMU1 staff in order to better manage resettlement activities.

Quality-at-Entry Rating: Moderately Satisfactory

b. Quality of supervision:
There was no quality of supervision assessment. The project experienced long delays in the procurement and implementation of five major ICB contracts. The Bank assisted the client to achieve the intended objectives, but the Ministry of Transport (MoT) supported state-owned enterprises (SOEs) were eventually allowed to bid after much debate, but only on a "by exception" basis. A Memorandum of Understanding regarding the use of SOEs had been concluded between the Bank and the Government, but there was a dispute as to whether the contracts in the project were commenced prior to the MoU signing date. In particular there was indecision regarding the use of SOE subcontractors. At a project management level, several challenges, such as the lack of sufficient working capital available at project sites, delays in the flow of counterpart funds for resettlement compensation, and enabling the client to meet its monitoring and reporting obligations, were ultimately resolved after introducing more persistent and tighter supervision. A number of just-in-time monitoring missions had to be conducted to look more closely at particular areas, such as technical audits and environmental and social safeguards compliance reviews. Safeguards inadequacies were addressed but the ICR does not clearly indicate whether there was compliance with safeguards policies.

Quality of Supervision Rating: Moderately Satisfactory

Overall Bank Performance Rating: Moderately Satisfactory

9. Assessment of Borrower Performance:

a. Government Performance:
The lack of coordination between the Ministry of Transport (MoT) and the Ministry of Finance for budgeting and appropriation of resettlement funding was a systemic issue impacting early implementation according to the ICR (page 18). While it is understood that their responsibility was to allocate scarce funds programmatically. there were delays. Repeated requests for policy waivers on SOE eligibility were likely indicative of MoT‘s marginal commitment to market reform in the transport sector. According to the Borrower's completion report the two main contractors subcontracted all works to SOE subcontractors. While the SOE reform agenda was in its early stages at the time decisions were, nevertheless, inordinately slow. There were also delays in the Borrower's handing over of the construction site to the contractor which highlighted institutional weaknesses and inadequate administration. The Government's commitment was sufficient in the end to achieve the development objectives with the target outputs and outcomes mostly achieved, but the project took five years longer than planned and, while there were some factors beyond the Government's control, more effective management of the transport sector program would have aided the timely flows of counterpart funds and helped reduce delays.

Government Performance Rating: Moderately Unsatisfactory

b. Implementing Agency Performance:
The implementing agency, called Project Management Unit 1, and housed in the MoT, initially proved ineffective and did not satisfy management requirements for the project’s implementation including the overseeing of safeguards, where it clearly had insufficient knowledge and capacity. There was a reluctance to move away from support of state-owned enterprises. There were issues regarding insufficient working capital on site by the primary contractors leading to delays, ongoing procurement issues and poor financial management. Timely submission of quarterly financial management reports was unsatisfactory. The implementing agency failed to submit the necessary performance indicator information in a timely fashion. When collusive practices were identified, however, the agency, aided by the central government, did move decisively to ensure that the affected contracts were re-bid. Under IDA's guidance implementation eventually improved to a minimum compliance level to finally get most of the job done.

Implementing Agency Performance Rating: Moderately Unsatisfactory

Overall Borrower Performance Rating: Moderately Unsatisfactory

10. M&E Design, Implementation, & Utilization:

a. M&E Design:
M&E design for the original credit featured seven appropriate outcome indicators, some of which were indirect proxies for outcomes but which, nevertheless, were reasonably attributable to the achievement of both the project objectives and expected impacts to intended beneficiaries. These outcome indicators provided inter alia evidence about savings in travel times and reductions in the incidence of flood related road closures. Progress with indicators was to be measured by the Ministry of Transport and their consultants from records of traffic surveys and accident reporting. Baseline measurements for most indicators were not made prior to implementation.

b. M&E Implementation:
Baseline measurements of most indicators did not become available until after the mid-term review, data quality and collection did improve gradually over time. During project implementation three additional outcome indicators were introduced in the additional financing credit aimed at assessing the transport efficiency and the road safety impact of constructing the GH2 Bridge. In preparation for their actual measurement, such indicators were slightly adjusted by the Borrower to make them more useful. The revised indicators adequately reflect progress relative to the project development objectives and the outcomes are directly attributable to the GH2 Bridge investment.

a. M&E Utilization:
There is little evidence of utilization of the M&E framework. The ICR indicates that the implementing agency was overly focused on completion of the physical construction of NH1, and did not provide sufficient attention to monitoring and reporting activities. The outcome indicators on accidents at the nine blackspot locations financed with Government funds (as opposed to IDA funds) were not measured, because the works began at a late stage.

M&E Quality Rating: Modest

11. Other Issues:

a. Safeguards:

Environmental. The project was classified as an Environmental Category A operation. As well as triggering an Environmental Assessment (OP/BP 4.01), the Indigenous Peoples (OP 4.20) and Involuntary Resettlement (OP 4.30) safeguards were triggered. The possible risks were construction related environmental impacts that could have been avoided with proper implementation of the environmental management plan. However, the implementation agency PMU1 failed to acquire competent environmental staff to oversee the construction and dismantled its environmental unit. This led to serious hazardous worker health and safety, and pollution risks in the air, water, and ground. The breaches in safeguards led to remedial actions including re-opening the unit with new (but inexperienced) environmental staff and initiating training for them. This could have been avoided through better supervision by the PMU1 agency. The ICR does not indicate whether there was an improvement in the performance of the environmental staff after training had taken place. Although remedial actions were implemented, there is also no clear statement of compliance with OP 4.01.

Social. The project complied with agreed-upon social safeguards even though there were some delays for the affected households (ICR page 11). The Resettlement Action Plan (RAP) had projected that 14,429 households would be affected, but some 20,546 affected households were eventually identified. This generated a 30 month extension to the resettlement program. The compensation paid more than doubled, however, from US$ 22.7 million to US$ 48.0 million (ICR, Annex 4) and a substantial proportion was paid out in the first year of the project and in accordance with the RAP (ICR, Annex 8, Borrower ICR). There is no specific statement as to the level of satisfaction of the recipients about the way compensation was handled, but it must be assumed that the delays were not helpful.

In terms of addressing the needs of the ethnic minority groups under OP 4.20, an Ethnic Minority Development Plan (EMDP) was implemented in which the PMU1 implemented a rehabilitation program for the relocated minority families. About 11 percent of the project affected persons in the Can Tho-Ca Mau section belonged to the Khmer minority and five percent to the Hoa minority, respectively. The province with the highest proportion of ethnic minority PAPs was Soc Trang (31 percent Khmer and nine percent Hoa). Special training and assistance needs for ethnic minority project affected persons were identified through socioeconomic surveys and further confirmed through public consultations. PMU1 prepared and implemented a rehabilitation program for those families in accordance with the EMDP (the ICR does not give details). The Bank provided regular guidance on EMDP implementation and rehabilitation planning to PMU1-South staff, which had no experience in ethnic minority issues prior to the project. There is no clear statement of compliance with OP 4.20.

b. Fiduciary Compliance:

Financial management (FM). The preparatory activities to underpin FM performance included PMU1 staff training, improvements to the database, monitoring resettlement compensation, and capturing resettlement expenditures relative to physical progress indicators. However, during construction and resettlement the PMU1 failed to turn in first quarterly Project Financial Management Reports (PMRs) in a timely fashion. The reports were only submitted three years after effectiveness with negative consequences. PMR quality did eventually improve to barely satisfactory; however tardiness remained an unresolved issue (ICR page 12). To tackle this problem, technical assistance for FM was initiated in July 2006, but still, no quarterly FMRs were submitted in 2008 and only in mid-2009 did the submissions resume. The ICR does not mention whether the project was externally audited and if so whether the auditor's opinions were unqualified.

Procurement. The procurement process for the civil works started early with bidder pre-qualification 16 months in advance of project effectiveness. However, contracts were awarded behind the set schedule (MD1, MD2, and FL1 contracts were signed in February 2003) 15 months behind schedule. The MD3 and FL2 contracts were signed two years later than expected. One of the main issues is linked to the Ministry of Transport dependency on the State Owned Enterprise’s eligibility to participate in the procurement of these contracts. This led to different interpretations and multiple concerns due to the lack of clarity on this issue in the Bank’s procurement guidelines. Moreover, during the National Competitive Bidding (NCB) procurement for construction of three failed bridges in the MD2 section of NH1, the Bank received an anonymous allegation that collusive practices had taken place in the award process. The Ministry of Transport with the PMU1 conducting the investigation debarred 4 firms for violations during the bidding process. These packages were then re-bid, awarded, and ultimately implemented.

c. Unintended Impacts (positive or negative):

d. Other:



12. Ratings:

ICR
IEG Review
Reason for Disagreement/Comments
Outcome:
Moderately Satisfactory
Moderately Satisfactory
 
Risk to Development Outcome:
Moderate
Moderate
 
Bank Performance:
Moderately Satisfactory
Moderately Satisfactory
 
Borrower Performance:
Moderately Satisfactory
Moderately Unsatisfactory
Government commitment was barely sufficient to meet the development objectives and there was marginal commitment to market reform in the transport sector. There were substantial delays related to both resettlement funding and SOEs. The implementing agency was ineffective for much of the project and did not satisfy management requirements for project implementation including the overseeing of safeguards, where it clearly had insufficient knowledge and capacity.  
Quality of ICR:
 
Satisfactory
 
NOTES:
- When insufficient information is provided by the Bank for IEG to arrive at a clear rating, IEG will downgrade the relevant ratings as warranted beginning July 1, 2006.
- The "Reason for Disagreement/Comments" column could cross-reference other sections of the ICR Review, as appropriate.

13. Lessons:
The following three lessons selected from the ICR are deemed the most significant:

Where a road construction industry is dominated by state-owned enterprises, a strategic approach, agreed between the Bank and the Government, is necessary to establish a competitive and efficient market.

Better management of capital resources can improve implementation efficiency and reduce delays. A more accurate estimation and subsequent timely availability of counterpart funds, particularly for land acquisition and resettlement, would help keep projects within their expected delivery schedule.

The definition of the project development objectives should reflect all project components. In this case, it largely excluded the goals pursued under institutional strengthening. As a result, there were no objectives-level performance indicators targeting technical assistance based activities, such as Ministry of Transport management strengthening or the need for official adoption of updated road and bridge standards.

14. Assessment Recommended?

No

15. Comments on Quality of ICR:

The ICR is fairly comprehensive and provides most of the elements necessary to evaluate the project. The report is clearly written and reasonably balanced in its assessment of outcomes and ratings. It is also candid in its reporting of the anonymous allegation of collusive practices faced in procurement of national competitive bidding. There are, however, some shortcomings. Given that this was a Category "A" project, an omission is a clear statement concerning compliance with OP 4.01. There is also no mention of whether the audit reports were unqualified. Content of the ICR would have been improved with input from the Japan Bank for International Development (JBIC) on the bridges it financed in parallel with IDA, but, while this information was requested, no reply was received.

a. Quality of ICR Rating: Satisfactory

(ICRR-Rev6INV-Jun-2011)
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