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World Bank Document Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized RepoA No. 3290a-EGT FILE COPY Public Disclosure Authorized ARAB REPUBLIC OF EGYPT STAFF APPRAISAL REPORT OF THE BEHEIRA PROVINCIAL POTABLE WATER SUPPLY PT Public Disclosure Authorized May 7, 1981 Public Disclosure Authorized Water Supply and Sewerage Division Europe, Middle East and North Africa Regional Offs This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. ARAB REPUBLIC OF EGYPT APPRAISAL OF BEHEIRA PROVINCIAL POTABLE WATER SUPPLY PROJECT CURRENCY EQUIVALENTS Currency Unit = Egyptian pound (LE) = 100 Piastres (Pt) LE 1 = US$ 1.429 US$1 = LE 0.70 LE 1 million = US$700,000 1 SDR = US$1.228522 WEIGHTS AND MEASURES mm = Millimeter (1 millimeter = 0.039 inches) cm Centimeter (1 centimeter = 0.39 inches) m Meter (1 meter = 3.28 feet) km = Kilometer (1 kilometer = 0.62 miles) 2 2 km = Square Kilometer (1 Km = 247.1 acres) m3 = Cubic Meter (1 m3 = 264.2 US gallons) 3 3 m /day = Cubic Meter per day (1 m /day = 264.2 US gallons per day) m/hr = Meter per hour = (m/hr = 3.28 feet per hour) lcd Liter per capita per day (1 lcd = 0.26 US gallons per capita per day) l/sec = Liter per second (1 1/sec = 0.26 gallons per second) FOR OFFICIAL USE ONLY ABBREVIATIONS AND ACRONYMS AWGA Alexandria Water General Authority BWC Beheira Water Company CAPMAS Central Agency for Public Mobilization and Statistics COAA Central Organization for Accounting and Audit GOGWS General Organization for Greater Cairo Water Supply GOPW General Organization for Potable Water GOSSD General Organization for Sewerage and Sanitary Drainage MHR Ministry of Housing, Reconstruction and Land Reclamation NWSA National Water and Sewerage Authority ODA UK Overseas Development Agency PIU Project Implementation Unit SAS Standard Accounting System SCA Suez Canal Authority UNDP United Nations Development Program USAID U.S. Agency for International Development WHO World Health Organization FISCAL YEAR (Government of EGYPT and BWC) July 1 - June 30 This document has a restricted distribution and may be used by recipients only in the performance of | their official duties. Its contents may not otherwise be disclosed without World Bank authorization. p X ARAB REPUBLIC OF EGYPT STAFF APPRAISAL REPORT OF THE BEHEIRA PROVINCIAL POTABLE WATER SUPPLY PROJECT TABLE OF CONTENTS Page No. I. WATER SUPPLY AND SEWERAGE SECTOR .................. 1 Background ........................................ 1 Water Resources and Sewerage ...................... 2 Constraints to Sector Development ................. 3 Government Priorities in the Sector .... ........... 4 Sector Organization ............................... 4 Performance in Previous Bank Loans .... ............ 5 IDA's Objectives for the Sector ................... 6 II. PROJECT AREA ...................................... 7 General Features ................ , 7 Level of Service .................................. 7 Production .................................. 8 Distribution ...................................... 9 Other Supplies and Developments ................... 10 Sewerage .......... ................................ 10 III. DEMAND ASPECTS .................................... 12 Population ........................................ 12 Forecast of Demand ................................ 12 IV. THE PROJECT ....................................... 15 Project Objectives ............ ................... 15 Project Scope ..................................... 15 Project Description ............................... 16 Cost Estimates .................................... 18 Status of Engineering ............................. 19 Procurement and Project Implementation .... ........ 19 Construction Schedule ............................. 20 Credit Amount ..................................... 20 Monitoring Criteria ............................... 21 Land Acquisition and Water Rights .... ............. 21 This report was prepared by Messrs. R.G. MacWilliam (Senior Sanitary Engineer), and M.N. Shehadeh (Financial Analyst). TABLE OF CONTENTS (Cont'd) Page No. V. BENEFICIARY ...................................... 23 Introduction ..................................... 23 Organization and Management ...................... 23 Management Assistance ............................ 24 Staffing .......... ............................... 25 Training ......................................... 26 Billing and Collection ........................... 27 Accounting System ................................ 28 Audit ............ ................................ 28 Insurance ........................................ 29 VI. FINANCIAL ANALYSIS ............................... 30 Present Situation ................................ 30 Tariffs .......................................... 30 Financing Plan ................................... 34 Future Financial Performance ..................... 36 VII. ECONOMIC AND SOCIAL ASPECTS ...................... 37 Health Benefits and Environmental Impact .... ..... 37 Least Cost Solution .............................. 37 Economic Analysis ................. 37 Impact on the Poor ............................... 38 Risks and Safeguards ............................. 38 VIII. AGREEMENTS TO BE REACHED AND RECOMMENDATIONS ..... 39 Additional Information in Project File .... ....... 41 LIST OF ANNEXES Annex 1 Cost Estimate and Credit Allocation Annex 2 Construction Schedule Annex 3 Sector Organization Annex 4 BWC Organization Annex 5 Monitoring Indicators Annex 6 Demand and Population Forecasts Annex 7 Schedule of Disbursements Annex 8 Assumptions for Financial Projections Annex 9 Financial Statements Annex 10 Draft Terms of Reference for Management Assistance MAP IBRD Map No. 15469 B I CHAPTER I THE WATER SUPPLY AND SEWERAGE SECTOR Background 1.01 Egypt has an area of about one million km2 and except for the delta area and the coastal strip along the Mediterranean coast is practi- cally rainless. It is the cradle of one of the world's oldest civiliza- tions, some of the remains of which are still perfectly preserved in Egypt's arid climate. These are viewed annually by hundreds of thousands of visitors. In rural Egypt the tempo of life today seems unchanged through the centuries but in the large cities the symptoms of modern life are typically, traffic congestion, noise, pollution, uncollected garbage, slum housing and overcrowding. The Government is now beginning to tackle the problems of the cities by promoting and encouraging population redistribution to strategically planned new towns. Associated with this policy is an effort to try and stem the drift from the rural to the urban areas by improving living conditions for the rural population. 1.02 Based on the 1976 census carried out by the Central Agency for Public Mobilization and Statistics (CAPMAS), it is estimated that the present population of Egypt exceeds 40 million; at expected rates of growth, it will reach 53 million by 1990 and nearly 68 million by year 2000. About 14 million of the total population is concentrated in the cities of Cairo, Alexandria and the Suez Canal Zone, while about 18 million (45% of the total population) is located in the fertile Delta Region north of Cairo. Most of the country's production and economic activity is centered around the major and secondary cities. However, at the heart of Egypt's economy is its rich agricultural heritage, nurtured by irrigation from the Nile River and sustained by innumerable farming families living in small villages and settlements. 1.03 Administratively the country is divided into 26 governorates with the largest concentrations of populations in the six urban governorates of Cairo, Giza, Alexandria, Port Said, Suez and Ismailia. In 1977 eight economic planning regions were created each comprising a number of governorates presided over by High Committees for Regional Planning in each region; the committees consist of governors from the regions, representa- tives of various ministries and the head of a Regional Planning Authority, locally based, which is part of the Ministry of Planning. The planning regions are not an intermediate tier of Government but are a means of promoting cooperation and coordination of development between governor- ates. Meanwhile, a Local Government Act 43/1979 has extended the powers of governorates and increased their budgetary powers and financial resources allowing each governorate to prepare its own economic plan with agreed available resources. Governors hold the rank of minister and account directly to the President. -2- Water Resources and Sewerage 1.04 Egypt depends on the Nile River as its primary source of potable water. In conjunction with available groundwater, this source is ample to supply all the country's needs for the foreseeable future. A recently com- pleted UNDP financed Water Master Plan Study, for which the Bank was exe- cuting agency, confirmed that public water supplies will absorb no more than 5% to 6% of the total available resources. 1.05 Egypt's water supplies, outside Cairo, Alexandria and the Suez Canal cities fall into three broad categories: (i) the eleven regional systems built and operated by the General Organization for Potable Water (GOPW) in the provinces which serve numerous towns, villages and rural com- munities, mainly in the delta area; (ii) about 115 systems in the larger provincial towns operated by municipalities; and (iii) borehole or well
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