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World Bank Document FiLE COPY RESTRICTED Report No TO- 533a Public Disclosure Authorized This report was prepared for use within the Bank and its affiliated organizations They do not accept responsibility for its accuracy or completeness The report may not be published nor may it be quoted as representing their views INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION Public Disclosure Authorized APPRAISAL OF A HIGHWAY ENGINEERING PROJECT MALAWI Public Disclosure Authorized September 6, 1966 Public Disclosure Authorized Projects Department CURRENCY EQUlVALENTS Currency Unit - Malawi Pound (ME:) U S $1 = ME 357 ML 1 = U S $2 80 ML6 1, 000 000 = U S $2, 800, 000 FISCAL YEAR January 1 - December 31 WEIGHTS & MEASURES English MALAWI APPRAISAL OF A HIGHWAY ENGINEERING PROJECT TABLE OF CONTENTS Page No. SUNMARY I INTRODUCTION 1 II BACKGROUND 1 III TRANSPORT IN MALAWI 2 General 2 Railways 2 Roads 3 Lake Transport 3 Transport Development Plan 3 Transport Coordination 4 IV THE PROJECT h V ECONOMIC JUSTIFICATIO01\ 6 VI CONCLUSIONS ATD RECOIIEHDATIONS 7 TABLE Design Standards MAP Malawi, Highway System This report is based on the findings of a mission in December 1965 to Malawi composed of lIessrs. Soges and Jaycox of the Bank. MALAWI APPRAISAL OF A HIGHWAY EN1GINEERING PROJECT SU4ARY i The Government of Ilalawi has applied for an IDA credit to help finance consulting engineering services in connection with a future road construction program ii The project (see map) would provide the following services 1 Trunk road (Ml), Zomba - Lilongwe, 168 miles Detailed engineering, design and preparation of tender documents 2 Trunk road (M4), Lilongwe - Zambian border at Mch1in*e, 90 riles Review and revision as necessary of the detailed engineer- ing and cost estimates prepared by the Ministry of Works 3 Blantyre/Limbe - Lilongwe road Engineering and economic route-selection studies i1i The engineering services in connection with the first two roads would be completed in a neriod of about 12 months Item 3 above was begun in September 1965 and completed in February 1966, the work having been done at the suggestion of IDA to establish thie best route between these towns IV The total cost of the project is estimated at about US$575,000 equivalent, including contingencies The foreign exchange component is estimated at about 85 per cent, or US4h490,000, and would be financed by the proposed credit The Ministry of Works of the Government would be executing agent v During credit negotiations, the Government indicated that restric- tions on licensing of road transport between Blantyre/Limbe and Lilongwe have been removed, and assurance was given that no such licensing or other restrictions which might limit the growth of road transport between these two cities would be imposed without prior agreement between the Borrower and the Association The Government is preparing a program for investment in construction or improvement of agricultural feeder roads in areas of high agricultural potential served by the roads to be engineered under the Project, so that implementation of the program can be commenced during the period of construction of the roads covered by the Project vi The rate of return on the estimated investment required to im- prove the Zomba-Lilongwe road appears to be in excess of 15% However, detailed engineering for this road and the review of the engineering and cost estimates for improving the Lilongwe-Zambian border road are needed to determine accurately the justification and scope of the proposed con- struction project - 1i - Vil The project provides a suitable basis for an IDA credit of US$490,000 equivalent, whlch would include reimbursement for the route- selection studies already carried out bv consultants The proposed term of the credit is 10 years including a two-year period of grace MALPWI APPRAISAL OF AN ENGINEERING CREDIT FOR HIGHIWAY RECONSTRUCTION 1 INTRODUCTIOTN 1 1 The Government of Malawl applied for an IDA credit in February 1965 to help finance reconstruction and bituminous paving of the main north-south trunk road between Zomba (the capital) and Lilongwre, and of the main road between Lilongwe and the Zambian border near M4chinje The Government's appli- cation covered a total of 258 miles of road and was based on a transport sur- vey financed by USAID, and feasibility studies carried out by the Ministry of Works 1 2 An IDA mission visited Malawi in April/May 1965, and raised questions as to the desirability of reconstructing the existing road between Zomba and Lilongwe as proposed In particular, the mission recommended that alternative road locations be investigated by consultants prior to further IDA cons3deration These studies have been carried out by Brian Colquhoun and Partners, UK consultants, the consultants' draft report was presented to an IDA appraisal mission to Malawl in December 1965, and the final report was received in February 1966 The consultants' findings support the Govern- ment's original application Since cost estimates for construction of the roads are not firm, and it will be some months before the justification, scope of project and appropriate amount of a construction credit can be determined accurately, the Government has requested that the Association proceed now with the consideration of a credit for the detailed engineering of the road project 1 3 This appraisal report is based on the Government's application, the engineering and economic investigations of the choice of alternative routes carried out by the consultants at IDA's request, and on the findings of the appraisal mission consisting of Messrs Soges and Jaycox 1 4 This would be the first lending operation by the Bank or IDA in Malawi Malawi, formerly Nyasaland and a terrltory of the Federation of Rhodesia and Nyasaland (1953-1963), was not a beneficiary of any of the Bank loans to the Federation 2 BACKGROUND 2 1 Malawl is a long, narrow, landlocked country of east Africa, situ- ated in the Great African Rift Valley It has an area of about 45,700 sq miles, of which over 20% consists of lakes The land area is about the size of Portugal The country is over 550 miles long and less than 50 miles wide at its narrowest point Altitudes range from about 200 feet above sea level in the south to over 8,000 feet in the north A major Rift Valley escarpment runs the lengtll of the country separating the Lake Malawl plain (1500 ft ) from the plateau to the west (4500 ft ) Most of the main rivers - 2 - flow from west to north-east into Lake Malawl, with the exception of the Shire River which flows south from the southern end of the Lake and feeds into the Zambezi River These geographical and topogiaphical characteristics present difficult problems for inter-regional transpoitation 2 2 M4alawils population is estimated at 4 million, growing at the estimated rate of 37 per annum, which makes it one of the most densely popu- lated areas in Africa Gross Domestic Product was estimated in 1965 at about T 55 million (0155million) per capita income is very low at about $40 About 40% of estimated GDP is attributed to subsistence agriculture Commercial agriculture contributes about 18% of GDP, the main commercial crops are tea, tobacco, groundnuts, and cotton 2 3 During the decade of the country's membership in the Federation, its economy grew at the low annual rate of 3 5% Per capita income did not grow perceptibly From 1961 through 1964 the economy virtually stagnated due to the political uncertainties associated with the dissolution of the Federation and the achievement of national independence (July 6, 1964) In 1965, the economy apparently registered a 10% growth in real terms, reflect- ing renewed concentration on economic goals and favorable growing weather for major crops 3 TRAMSPORT IN MALAWI General 3 1 Malawi's transport system consists of 6,200 miles of roads of all classifications of which only about 250 miles are bituminous paved, most only to single-lane width, 290 miles of rail line which forms the domestic section of the rail link to the Indian Ocean port of Beira in Mozambique, three lake service ships and 14 barges which provide freight and passenger transport on Lake Malawl, and light aircraft services to 13 airfields within the country This transport network is generally inadequate to serve the country's transport requirements and hinders economic development Railways 3 2 The privately owned Malawl Railway is poorly aligned, and its equipment is generally outmoded and badly maintained The railway is saddled by a rate structure designed to subsidize exports by placing high rates on inports The Government, by virtue of its ownership of a special class of shares, has veto powers in the Board of Directors The Govern- ment intends that in due course the rail line from Salima to Balaka will be abandoned, and that a new 110 mile rail link will be built from the main line south of Shire Bridge through Liwonde and east to join the existing Mozambique system at Nova Frelxo, thus linking lalawi and the Indian Ocean port of Nacala As a corollary to these developments, it is proposed to dredge the Shire River from Lake Malawi to Liwonde Liwonde would then replace Chipoka as the main lake port and point of ship/rail transhipment The project road, M1, the main trunk road of the country, also passes through Liwonde, which would become the transport hub of Malawi Roads 3 3 The road system consists of 3,100 miles of trunk and secondary roads, for which the Ministry of Works is responsible, and 3,100 miles of district roads and tracks
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