Document of The World Bank

FOR OFFICIAL USE ONLY Public Disclosure Authorized

Report No: 23330

IMPLEMENTATION COMPLETION REPORT (CPL-36850)

ON A

LOAN Public Disclosure Authorized IN THE AMOUNT OF US$65 MILLION EQUIVALENT

TO THE

REPUBLIC OF PARAGUAY

FOR

THE EIGHTH HIGHWAYS PROJECT

Public Disclosure Authorized FEBRUARY 20, 2002

Finance Private Sector and Infrastructure Department Country Management Unit - LCC7C Latin America and the Caribbean Regional Office

This document has a restricted distribution and may be used by recipients only in the performance of their I official duties. Its contents may not otherwise be disclosed without World Bank authorization. Public Disclosure Authorized CURRENCY EQUIVALENTS (Exchange Rate Effective November 27, 2001) Currency Unit = Guarani I Guarani = US$ 0,000214 US$ 1 = 4660 Guaranis

FISCAL YEAR January 1 to December 31

ABBREVIATIONS AND ACRONYMS

CAS Country Assistance Strategy CONAVI National Housing Council CORPOSANA Municipal authority of sewage and water services in Asunci6n DINATRAN National Transportation Directorate DPP DRH's Department of Planning and Projects DRH Directorate of Highways EU MOPC's Environmental Unit FONPLATA Fondo para la Cuenca de la Plata GoP Government of Paraguay HDM Highways Design&Maintenance Standards Model IBRD International Bank for Reconstruction and Development ICB International Competitive Bidding IDB Inter-American Development Bank IERR Internal Economic Rate of Retum IRI International Roughness Index JBIC Japan Bank for International Cooperation MOPC Ministry of Public Works and Communications MTR Mid-term Review OPIT Transport Planning Office PPF World Bank's Project Preparation Facility SAR Staff Appraisal Report SETAMA Metropolitan Transportation Secretary SIAMV Integrated Road Maintenance Management System USecPWC Undersecretariat of Public Works and Communications UsecT Undersecretariat of Transport UsecA&F Undersecretariat of Administration and Finance

Vice President David de Ferranti Country Manager/Director: Myrna L. Alexander Sector Manager/Director: Jose Luis Irigoyen Task Team Leader/Task Manager: Paulus A. Guitink PARAGUAY HIGHWAYS VIII

CONTENTS

Page No. 1. Project Data 1 2. Principal Performance Ratings 1 3. Assessment of Development Objective and Design, and of Quality at Entry 2 4. Achievement of Objective and Outputs 4 5. Major Factors Affecting Implementation and Outcome 11 6. Sustainability 13 7. Bank and Borrower Performance 14 8. Lessons Learned 16 9. Partner Comments 18 10. Additional Information 19 Annex 1. Key Performance Indicators/Log Frame Matrix 20 Annex 2. Project Costs and Financing 24 Annex 3. Economic Costs and Benefits 26 Annex 4. Bank. Inputs 27 Annex 5. Ratings for Achievement of Objectives/Outputs of Components 28 Annex 6. Ratings of Bank and Borrower Performance 29 Annex 7. List of Supporting Documents 30 Annex 8. Log Frame: Mid-Term Review 31 Annex 9. Map of Project Components 34 Annex 10. Project Evaluation by the Borrower 35

Project ID: P007913 ProjectName: Eighth Highway Project Team Leader: Paulus A. Guitink TL Unit: LCSFT ICR Type: Core ICR Report Date: February20, 2002

1. Project Data

Name: Eighth Highway Project LIC/TFNumber: CPL-36850 Country/Department: PARAGUAY Region: Latin America and Caribbean Region

Sector/subsector: TH - Highways

KEY DATES Original Revised/Actual PCD: 01/30/1990 Effective: 07/20/1994 Appraisal: 06/12/1992 MTR: 06/23/1997 Approval: 12/21/1993 Closing: 06/30/1999 06/15/2001

Borrower/lmplementingAgency: GOVERNMENT/MOPC Other Partners:

STAFF Current At Appraisal Vice President: David de Ferranti Shahid Javed Burki Country Manager: Myma Alexander A. Sanchez Sector Manager: Jose Luis Irigoyen Ping-Cheung Lok Team Leader at ICR: Paulus A. Guitink William Matthey ICR Primary Author: Paulus A. Guitink

2. Principal Performance Ratings (HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=Highly Unlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible) Outcome: S Sustainability:UN InstitutionalDevelopment Impact:M Bank Performance:S BorrowerPerformance: S

QAG (if available) ICR Quality at Entry: S Projectat Risk at Any Time: Yes 3. Assessment of Development Objective and Design, and of Quality at Entry 3.1 OriginalObjective: The project was the first Bank-assisted operation in Paraguay's Transport Sector since 1982. Its development objectives aimed to: (a) strengthen the Ministry of Public Works and Communications organization; (b) improve its capacity to construct roads and to maintain them; (c) relieve urban problems or reduce the environmental hazards and the nuisance caused by the frequent flooding along Asunci6n's ringroad; (d) facilitate the use of the ports of Villeta and San Antonio to increase exports; (e) reduce the transportation costs of exporting soybeans to Brazil; (f) improve environmental assessment skills of MOPC's Environmental Unit (EU); and (g) assist MOPC in establishing a National Vehicle Registry.

3.2 Revised Objective: Project objectives were not revised during implementation. However, project impact, outcome and output were detailed specifically during the preparation of a logical framework at project mid-term review to monitor project performance and risks. The project matrix is presented in the annexes.

3.3 OriginalComponents: To achieve the objectives described above, the project included the following components: 1. Road Improvement. This component comprised the improvement of key national road links: (i) 58.6 km of roads of Route 1 in the southern access to Asunci6n from Paraguari to Ita and from Ita to Cuatro Mojones; (ii) 12.3 km of the Asunci6n's ringroad from Cuatro Mojones to Route 9 widened to four lanes, including construction of three overpasses, rehabilitation of three main at-grade intersections, and improvement of two main storm-drain canals; and, (iii) 17 km of roads of Route 3 paved in the northern access to Asunci6n from Limpio to Emboscada; 2. Road Rehabilitation. This included the resurfacing of 100 km of Route 6 from the junction with Route 7 to km 100 South of the junction; 3. Pilot Soil Stabilization Program. The program consisted of the improvement of approximately 28 km of unpaved rural roads by applying various types of soil stabilizers to such roads and monitoring and evaluating the performance of these products; 4. Consulting Services. This included the provision of consulting services to assist MOPC in the supervision of civil works, preparation of engineering designs, a study to devise alternatives to handle the increased flow of water carried by the Ytay and Lambar6 creeks, and a study to improve accesses to the greater Asunci6n area. The project also included technical assistance aimed at: (i) strengthening MOPC's organization and management capacity; (ii) establishment of MOPC's Environmental Unit; (iii) strengthening of the Directorate of Roads and Highways Department of Planning and Projects; and, (iv) implementation of a National Vehicle Registry. The project also included provision of equipment required for the implementation of various technical assistance components.

3.4 Revised Components: The loan was amended in April 1999 and August 2000, but the original project components were maintained throughout implementation. The first amendment included: (i) a downward adjustment of the percentage of loan disbursements for civil works to secure Bank financing throughout the project implementation period; (ii) an actualization of local counterpart funds required to complete the project and the amount of funds stipulated for road maintenance; (iii) broaden the scope of the unpaved roads stabilization pilot program by "applying stabilizing agents

-2- to test sections along such roads" and allow direct contracting with qualified suppliers; and (iv) update project implementation indicators. The second amendment intended to provide incentives to improve project implementation and included a redefinition of the paripasso and a reallocation of the loan proceeds to reflect financing demands from different categories.

3.5 Quality at Entry: Quality at entry is marginally satisfactory. The project objectives were consistent with the CAS, which focused on improving the conditions to attract private investment and improving the efficiency of the public investment to achieve long-term sustainable growth that would enable Paraguay to remain competitive within the context of MERCOSUR. Because of the long distances to deep-water ocean ports, transport efficiency is critical to maintain the competitiveness of Paraguay's exports. The project addressed major transport issues to reduce congestion to Asunci6n Port, including the diversion of exports to alternative ports such as Villeta and San Antonio and improving traffic flows along trunk routes providing access to Asunci6n from the North and the South. In doing so, the project is very relevant to the transport sector of Paraguay and to the economy as a whole.

However, project design failed to make adequate provision for a number of elements crucial to successful implementation:

* Insufficient attention to risk assessment and consequences of risks identified. Although weak implementation and management capacity for such a large and complex investment program and shortage of counterpart funds were recognized by the SAR as constituting a major risk in the short and medium-term, the project design did not incorporate any strategies for mitigating those risks. While the project included very stringent safeguards to ensure proper management of land acquisition and resettlement of affected people, the risks for project implementation of having to comply with these, for the country new requirements, were not identified, a problem that was aggravated by the weak analysis of the resettlement issues and the low priority given to the resettlement program. In addition, this was the first project in Paraguay to use the new Bank standard bidding documents, which resulted in substantial delays because local procurement practices had to be adapted first;

* The institutional strengthening component of the project was not adequately prepared and as a consequence implementation of this component took considerable more time than anticipated. On the other hand, the expectations were overly ambitious for the short timeframe envisaged for the provision of the technical assistance. The component also suffered from the deteriorating macro-economic situation which resulted in cancellation of various proposed training activities to strengthen professional capacity within MOPC;

* Insufficient attention was given to the design of adequate institutional arrangements for implementation of the project and no financial resources were allocated to project management, not even through the use of counterpart resources. Apart from a better institutional framework, project implementation would have been facilitated by the preparation of an organizational and operational manual and development of project performance and monitoring indicators. Only during the Mid-term review in June 1997, adequate project performance and monitoring

-3- indicators were developed. This problem was caused in part by the limited resources available through the PPF for the preparation of the project, which affected the quality of the preparation studies. 4. Achievement of Objective and Outputs 4.1 Outcome/achievement of objective: The achievement of project development objectives is rated satisfactory, despite the two-year delay at the start of project implementation and the slow implementation progress during the last two years before the closing date. The original loan closing date of June 15, 1999, was extended twice. The first extension until December 31, 2000, was included in an amendment given in order to (i) adjust downward the percentage of loan disbursements for civil works to secure Bank financing throughout project implementation; (ii) update local counterpart funds required for completion of the project and the amount of funds stipulated for road maintenance; (iii) broaden the scope of the unpaved roads stabilization program by "applying stabilizing agents to test sections along such roads" and allow direct contracting with qualified suppliers, and (iv) update project implementation indicators. The second extension until June 15, 2001, was given at the Government's request, to allow completion of the civil works and implementation of MOPC's institutional component. Despite these delays most of the intended project outputs and outcomes have been achieved. With regard to Asunci6n's ringroad works, the Government is committed to the completion of the physical works, which is now estimated to finish in April 2002. An assessment of each of the development objectives follows.

(a) Strengthening of MOPCs organization. The institutional strengthening of MOPC is rated satisfactory. Despite implementation delays in hiring the institutional and management consultant and in implementing the consultant's recommendations, MOPC has implemented most of the consultant's recommendations and has made progress in increasing its efficiency by: (i) improving managerial capacity of the Undersecretary of Administration and Finance through upgrading the information system procedures, streamlining administrative processes for payments of contractors, and implementing a new government accounting system SIAF; (ii) strengthening of the EU through training of staff and workshops and improving its organizational structure; (iii) providing a regulatory framework for transport through the preparation and promulgation of a Transport Law; (iv) creating a unit to manage resettlement programs; and, (v) initiating the refocusing of the Directorate of Roads and Highways (DRH) on its core functions through the development of a strategy for outsourcing maintenance operations. The (DRH) is also designing a road concession program to expand private sector participation in the financing, operation, rehabilitation and maintenance of roads. An Inter-American Development Bank (IDB)-supported study identified 811 km of national roads with traffic volumes sufficient to consider conversion into toll roads. These concessions will provide a total investment of US$400 million over the 25-year concession period.

As mentioned above, MOPC designed a new Transportation Law with the technical assistance provided through the project. In September 2000, Congress approved Law 1.590, which regulates the National Transportation System. The Law created not only the National Transportation Directorate (DINATRAN), but also the Metropolitan Transportation Secretariat (SETAMA). These institutions, already in operation, are expected to develop policies and

-4 - regulations for the national and international passenger and goods surface transportation within the Paraguayan economy. This is an important achievement that will contribute to the improvement of the transportation sector efficiency.

In addition, the project supported MOPC in the preparation of the final engineering designs to improve drainage conditions along the Ytai and Lambare creeks. Flooding along these two creeks is expected to increase as a result of the improved watershed of the drainage works included in Asunci6n's ringroad improvement. MOPC is seeking financial support for the required investments to mitigate these floodings.

Although the technical assistance component has focused on improving MOPC's managerial capacity, there is still room for improvement. The management study has provided MOPC with an institutional action plan that contains some activities yet to be carried out. Some of these activities include the creation of the National Traffic Safety Council, a unit for strategic planning, and the strengthening of its human resource management which implies creating a performance evaluation system, rationalization of personnel, designing a new salary scale and improving the recruitment system. The MOPC is in the process of completing the first two activities. Regarding the Human Resources action plan, the proposed activities are not within the competence of MOPC and must be analyzed and implemented within a broader context aimed at a Public Sector Reform Project.

(b) Improving MOPCs capacity to construct and maintain roads. The objective of improving MOPC's road construction capacity was achieved satisfactorily. This was demonstrated through the capacity to implement an ambitious transport investment program for 1998-2001. At Mid-term review it was expected that MOPC would have increased its road projects spending considerably, aiming at US$768 million (not including maintenance) over the aforementioned period. Due to macroeconomic and fiscal restrictions and resulting implementation delays, this investment program could not be executed as envisaged. However, the level of expenditures was still much higher than in previous years.

During this period, the actual expenditures averaged about US$63 million per year. In individual years, expenditures fluctuated from a high of US$91 million in 1999 to a low of US$31 million in 2001. This level of expenditures was generated mainly as a result of the external financing which included IDB, JBIC, IBRD and FONPLATA projects, showing that MOPC has gradually increased its capacity to implement when compared to the average US$24 million expenditures registered over the 1981-1990 period. As per October 2001, MOPC has completed about 1,007 km of road rehabilitation and paving works through externally financed projects. The objective of improving MOPC's road maintenance capacity was addressed by: (i) increasing the allocation of funds to secure maintenance continuity: The loan agreement required that the Borrower provide an annual budget allocation of US$14.2 million with the purpose of securing the maintenance of national roads, other than the roads rehabilitated or improved by the project. Although not sufficient to cover all maintenance needs, the Borrower has complied, on average, with this requirement over the project life, which contributed to the conservation of the most important part of the national road network; and (ii) the design of a road maintenance model that

- 5- allows planning, programming and controlling all maintenance activities required to maintain the highway network Coordination between the Bank and IDB in tackling the maintenance problem resulted in: (a) IDB technical assistance to develop a management information tool for road maintenance - the SIAMV model - which is used by the Division of Conservation to estimate budget requirements, and, (b) assesment of opportunities and constraints to outsourcing of maintenance: since 1998, the Directorate of Highways has been gradually implementing a pilot road maintenance program that delegates maintenance to third parties, following recommendations made by the SIAMV management study. This initiative together with the concession program under preparation will provide an excellent opportunity to improve efficiency in maintenance operations, expand their coverage and, potentially, reduce the amount of local funds needed.

(c) Relieving urbanproblems or reducing environmental hazards and the nuisance caused by the frequent flooding along Asuncion 's ringroad. This objective was partially achieved and is rated satisfactory. The project supported the improvement of four key roads linking southern and northern access to Asunci6n, including Mime Lynch Asuncion's ringroad. Only three out of the four road subprojects were fully completed with substantial impact on the southem and northern accesses of the envisaged transportation system: Paraguari-Ita, Ita-Cuatro Mojones and Limpio-Emboscada. It is important to mention that the impact of the project on quality of life of the people living close to the completed works is expected to be substantial.

Asunci6n's ringroad could not be completed fully before the June 15, 2001, the closing date of the project, which, due to delays in the implementation, included an 18-month and subsequent 51/2-month extension. The approximately three and one-half year total delay resulted from: the long bidding process, the slow acquisition of land, and the relocation of affected people, all of which affected the commencement of this complex road.

Another factor that later affected the implementation of the mentioned roads was that the bids received for It,-Cuatro Mojones road and Asunci6n's ringroad were significantly higher than the expected cost at appraisal. In addition there were additional cost over-runs for civil works during the implementation. Main reasons for these cost increases were the poor quality of the design studies which underestimated costs significantly, as well as the substantial time between completion of the engineering studies and the start of the works during which rapid urbanization converted parts of the ringroad area from rural into suburban, requiring additional drainage and other works. This resulted in an increase in counterpart funds, which jumped to US$71 million from the originally estimated US$25 million. As a result of this increase, they had problems in mobilizing the counterpart funds needed on a timely basis since mid-1998. The shortage of local funds interrupted not only the construction of the ringroad for six months, but also that of the other roads, especially during the 2000-2001 period. This also happened to other projects in the road construction sector due to severe fiscal restrictions in the Government of Paraguay (GoP).

The construction of Asunci6n's ringroad (Works III-Mme Lynch) is not only the most complex of all the civil works under the project, but also will be the one to make a substantial impact on improving road access to Asunci6n. As of October 2001, there has been an implementation progress of 85.5% of the physical works and the GoP has budgeted the required funds for the

-6- completion of the works in 2002. The GoP has assured the Bank that completion of all on-going works of the ringroad is expected by June 2002 and is currently issuing specific treasury bonds to finance it. Although the physical works of the ringroad have not been completed, the satisfactory rating is based on the fact that so far, the environmental hazards caused by frequent flooding along the ringroad have been fully eliminated since last year due to the construction of proper drainage system and flood control canals already in place.

Once the works on Asunci6n's ringroad are completed, a substantial improvement of the level of service (mainly congestion reduction and improved safety) is expected. The impact of such infrastructure improvements, however, will be further enhanced if the initiatives proposed under the Transportation Master Plan for Asunci6n are implemented. The Master Plan encompasses medium and long-term investments needed to: (i) eliminate flooding along the main access roads to the Asuncion area; (ii) improve heavily congested traffic junctions (some of these will be undertaken by the municipalities within the Gran Asunci6n area); (iii) improve hazardous black spots; (iv) improve drainage systems; and, (v) build and operate a freight transfer station (through a public private partnership). In addition the drainage improvements along the ringroad (Mme Lynch) will increase flooding of the downstream Ytai and Lambare creeks. As mentioned earlier, engineering designs to mitigate flooding of both creeks were completed with Project funds. The works are seen as necessary environmental mitigation measures because of the extensive concentration and shedding of water flows that the improvement to the ringroad area will bring about. The GoP is committed to financing these works in the medium term.

(d) Facilitating access to the Ports of Villeta and San Antonio. This objective has been achieved satisfactorily and will be highly satisfactory once Asunci6n's ringroad is fully operational. The southern access (Road Paraguari-ItA-Cuatro Mojones) to Asunci6n has been completed and is already having a substantial impact on economic development and on improving the accessibility to the ports of Villeta (public operators) and San Antonio (private operators). In terms of economic development, the profile of the zone along the Ita-Cuatro Mojones road section has drastically changed from a rural into an urban area, generating increased private investments, such as shopping centers, gas stations, local micro-enterprises and other urbanization aspects. In terms of accessibility of the ports, traffic congestion to the ports of San Antonio and Villeta has been reduced substantially, improving efficiency of the ports. It is important to mention that in the San Antonio area, approximately ten new small private ports have been established since 1995, which have substantially benefited from the rehabilitation of the southern access to Asunci6n. -

In relation to the impact on the Port of Villeta, it was expected that a substantial part of the Asunci6n export flows would be diverted to the Villeta port, generating a larger increase in the export volume than for the Asunci6n port in comparison with 1994 levels. Because of external factors not foreseen at the time of appraisal this is unlikely to happen. In September 1994, Congress approved Law N° 419, which regulates the construction and operation of private ports. This Law gives the private sector the opportunity to invest and operate private ports along the Paraguayan rivers, as occurred in the San Antonio area. This, together with Paraguay's economic recession, affects the export volume of the port of Villeta, slowing down its growth.

-7- The accessibility to the ports will be further enhanced with the paving of Asunci6n's northern access (Limpio-Emboscada). This road section together with the improvement of the Emboscada-Tacuara road of Route 3 included under an IDB-funded project shortens the traveling distance between the northern part of the Region Oriental and Asunci6n by 80 km, thus improving the accessibility to Villeta and San Antonio ports. The Emboscada-Tacuara road is under construction but behind schedule and is now expected to be finished by December 2002.

(e) Reducing transportationcosts of exporting soybeans to Brazil. This objective was achieved satisfactorily. Located in the eastern part of the country, ouside the Asunci6n area, Route 6 forms part of the strategic network for Mercosur integration and the principal road for soybean exports to Brazil. Therefore, its improvement responds to the original project objective 3.1(e) to reduce the transportation costs of soybean exports to Brazil. The completed works extend the life of the pavement and reduce its roughness, with a positive 20.3 percent reduction in the average operating costs for all vehicles. Moreover, MOPC has awarded a concession to upgrade Route 7, converting it into a four lane road up until the access to Puente La Amistad, which facilitates transportation of soybeans to Brazil. This concession enhances the achievement of the project objective, especially if we consider that soybeans alone represents between 30 to 40 percent of the registered exports of Paraguay and the agricultural zone along both roads generates 70 percent of the soybeans exported.

(f) Improving environmental skills within MOPC. This objective has been achieved satisfactorily. A Ministerial decree issued on June 11, 1999, established the new organizational structure of the Environmental Unit, a very important accomplishment. Because of this new organization, the Unit has increased its personnel from three professionals to twenty experienced and trained staff. As a result, the Unit is carrying out environmental evaluations and proposing mitigation plans for road investments prepared by the Directorate of Highways. Also, the Unit has been actively involved in monitoring on-going works funded under IDB, JBIC and Bank projects through the project cycle: revising feasibility studies and monitoring the works of civil works contractors.

(g) Establishing a National Motor Vehicle Registry. This project objective has been accomplished satisfactorily but in a different manner from that initially envisaged. The objective was achieved without direct involvement of the project other than defining the mechanism for MOPC to access relevant data collected through the Registry (as mandated by law). Law 608/95 assigned the establishment and responsibility for a National Motor Vehicle Registry to the Judiciary's Direcci6n General de Registros Pzublicos-DGRP. The new Registry procedures reflect the intention of eliminating the use of circulation permits for vehicles illegally imported from neighbouring countries. Currently, it is estimated that approximately 150,000 vehicles out of 600,000 were illegally "imported" in Paraguay. The Registry has been fully operational since January 2000 and as of October 26, 2001, 200,000 vehicles were registered. It is expected that all vehicles will be registered by May 31, 2002. The MOPC, DINATRAN and the Police will access relevant data for transport research and planning activities collected through the Registry. However, placement of the Registry outside the sector ministry responsible for transport, where it can be found in most other countries, may have an impact of the efficiency and effectiveness of information exchange.

-8 - 4.2 Outputs by components: The project achieved most of its outputs and the overall assessment of the project outputs is rated satisfactory. The principal achievement of the project is that there are now: (i) 58.45 km of improved roads in the southern access to Asunci6n; (ii) 17.20 km of paved roads in the northern access to Asunci6n; (iii) 100 km resurfaced on Route 6; (iv) 31.3 km of unpaved roads tested with low-cost technologies through the application of stabilizing agents; (v) completed Asunci6n Transportation Master Plan for the next 20 years; (vi) completed final designs for improvement of the Ytay and Lambare creeks; (vii) strengthened managerial capacity of MOPC; (viii) incorporated environmental awareness within MOPC; (ix) adopted road maintenance culture; and, (x) the establishment of the National Motor Vehicle Registry.

The output construction of 12.3 km Asunci6n's ringroad between Cuatro Mojones and Route 9 was achieved partially and is rated unsatisfactory. In terms of implementation, this was the most complex part of the project. Two overpasses located between Av. Mariscal Lopez and Av. Francisco Ayala road junctions of Madame Lynch Avenue have not been completed as planned. The estimated total cost of Asunci6n's ringroad is approximately US$70.53 million, of which US$60 million has already been spent. The implementation progress is 85.5 percent of the physical works. The GoP will finance and complete the civil works based on a tentative -optimistic- schedule to finish the physical targets in June 2002. The total cost includes US$2.1 million allocated to finish the sewage system along the ringroad because CORPOSANA, the municipal authority responsible for providing water and sewage services to Asunci6n's ringroad urbanized area, could not maintain its commitment to execute the sewage works with its own budget due to a cancellation of a World Bank loan and lack of internal funds.

Another output by component that could be achieved only partially and is rated marginally satisfactory was the pilot soil stabilization program of unpaved roads. Although the pilot design and the supervision during the application of the stabilization agents was carried out by a consulting firm, the monitoring and final testing after one year of trial period included in the same contract were not adequately performed by the supervision consultant. The Final Report was delivered by the consultant six months after completion of the last pilot section - where a 1 year trial was agreed in the TORs - and did not include a cost-effectiveness analysis of the stabilization agents and its impact on routine maintenance, and lacked monthly monitoring of completed sections and laboratory testing on the road sections. The Department of Rural Roads carried out only a superficial visual testing based on physical performance before and after heavy rains with traffic, but this was clearly insufficient to provide conclusions and recommendations for future application. Therefore, MOPC cannot yet adopt these low-cost technologies for stabilization of unpaved roads in other projects.

4.3 Net Present Value/Economic rate of return: The economic analysis ex-post of the road improvements and rehabilitation components was undertaken using the HDM III model. The main differences between ex-ante and ex-post analysis were an overall cost increase of 70.5%, and a larger construction period. The principal benefits in the "with the project" compared to the "without the project" include: (i) savings in vehicle operating costs due to road improvements and rehabilitation; (ii) time savings for passengers; and, (iii) savings in routine maintenance. The ex-post internal economic rate of return (IERR) for the

-9- road component (97% of the total project cost) was estimated at 21.3% and the ex-post NPV at about US$84.23 million equivalent. The estimated IERRs for the roads are positive ranging between 18.8% for Cuatro Mojones-Jct. Route 9 (Asunci6n's ringroad) and 28.4% for Route 6- Jct. Route 7. Although the ringroad is not yet fully operational, the ex-post economic rate of return for the project is still satisfactory.

4.4 Financialrate of return: Not applicable

4.5 Institutional development impact: Even though the institutional component took eight years to be implemented, the project provided significant contributions to the institutional development of the transport sector in Paraguay. In particular, the project assisted in: the development of the Transport Law that created a National Transport Directorate (DINATRAN) and a Metropolitan Transport Secretariat (SETAMA); the improvement of budget allocations for maintenance of the road network over the project implementation period; promotion of private sector participation through gradually outsourcing road maintenance and the introduction of road concessions; the development of a Transport Master Plan for the Asunci6n metropolitan area; introduction and testing of low-cost stabilization technologies to reduce maintenance cost of rural roads; establishment of the National Motor Vehicle Registry; establishment of a Unit to prepare and implement resettlement programs; and the strengthening of MOPC's institutional and managerial capacity. In regard to the latter, the project assisted MOPC in strengthening the Under-secretariat of Administration and Finance, the Directorate of Roads and Highways, the Directorate of Project and Planning, and the Environmental Unit, among others. As a result, MOPC is carrying out better analysis in terms of: (i) contracting out feasibility studies and engineering final design; (ii) monitoring supervision of civil works and road construction with private companies; and, (iii) performing and supervising environmental evaluations.

Although it took approximately three and one-half years to implement the Project's resettlement program (originally expected to be executed in twelve months), MOPC belatedly managed the reallocation and compensation process of affected vulnerable groups and allowed the start of civil works for the three key roads included in the program. According to a survey, most resettled households (owners, occupants and tenants) were generally satisfied. In most cases, the adopted solutions represented an improvement in the quality of life of the families on the 550 affected properties. Overall, there were two primary benefits to the affected households: (i) they obtained land tenancy; and, (ii) they experienced an improvement in the physical condition of their residence. The evaluation showed that the living conditions for more than 70 percent of the affected people has improved, especially regarding the tenurization of property titles. Based on this experience, MOPC is in the process of creating a real estate unit to assist vulnerable people and implement resettlement programs.

The human resources institutional policies recommended by the management consultants to strengthen productivity within MOPC could not be applied or implemented due to the broader context of state reform this has to be placed in. However, MOPC has prepared and assigned resources to prepare an intensive technical training program for its personnel for the next fiscal

- 10- year. It is important to mention that in previous years, the MOPC has budgeted financial resources for training, but implementation was not possible due to lack of financial means. 5. Major Factors Affecting Implementation and Outcome 5. 1 Factors outside the control of government or implementing agency: El Nifio phenomenom. Heavy rains due to El Nifno partially delayed the execution of civil works in 1997-1998, especially on the construction of the ringroad and adjacent drainage canals.

Use of World Bank Standard Bidding documents. This was the first project in Paraguay that used the World Bank Standard Bidding Documents which required substantial adjustments to previously used local practices. It took considerable time before agreement was reached between MOPC and the Bank on the format of the documents to be used for prequalification and bidding.

Deteriorating macro-economic situation contributing to shortage of local counterpartfunds. A deteriorating macro-economic situation aggravated the problem of shortage and untimely provision of counterpart funds caused by poor design quality, implementation delays and inefficient administrative procedures. Problems with counterpart funding reduced project performance throughout the implementation of the project. The civil works and the institutional component implementation processes were affected by the lack of local budgetary resources, which became particularly acute during the last two years of implementation. This situation also plagued implementation of other projects in the transport sector in Paraguay resulting in a severe financial crisis in the construction sector and slowing and sometimes interrupting all ongoing civil works. The Government has tried to meet the contractor's demands for payment by issuing Government Treasury Bonds, selling the bonds in the local market or paying the contractors with bonds. The Government has also used this financial mechanism to cover MOPC's recurrent budget.

5.2 Factors generally subject to government control: Weak Assessment of MOPCs Institutional Capacity to Execute the Resettlement Program. At project start MOPC had a very small staff and inadequate organizational structure and procedures to undertake expropriation and land acquisition, and reallocate 1,882 people or 550 properties.

Project implementation arrangements failed to create a dedicated Project Implementation Unit. The responsibility of project execution belonged to MOPC but was divided among the Undersecretary of Public Works through the Directorate of Highways, the Directorate of Goods and Supplies, the Environmental Unit, the Undersecretary of Administration and Finance, and the Undersecretary of Transport. The DRH was responsible of providing overall coordination and reporting requirements; however, the project did not include the preparation of the organizational functions and Operational Manual which could have stated clearly their main functions, administrative responsibilities, budget resources, office space, equipment and personnel assigned to project on a full time basis. The lack of a special unit or a core group dedicated exclusively to this project generated delays in the day-to-day administration and timely decision making.

Parallel civil works subproject for the ringroad sewage canceled by CORPOSANA. The municipal water company for Asunci6n was unable to comply with bidding schedules for sewage/drainage works intended to connect with the drainage system to be built under the ringroad subproject. In order not to delay implementation indefinitively, the project assumed the necessary civil works generating unforeseen cost overruns and delaying the implementation of the ringroad subproject.

Changeover in government administration. Over the life of the project, Paraguay had three different governments. This resulted in different ministers and several changes in project coordinators. This adversely affected continuity and resulted in weak performance in project implementation.

5.3 Factorsgenerally subject to implementing agency control: Inadequate project organizational structure. The MOPC did not have an adequate organizational structure to implement the project. This was reflected in the poor management of the resettlement program and in the slow bidding prequalification process during the early phases of the project.

Engineeringdesigns. The initial engineering designs and technical specification studies prepared by the consultants with PPF funds were not suited to site conditions, resulting in the need for major variations during construction which generated cost overruns, see table below.

_"_*ll+WOrk:I 1~WrkaCost,USiMlllan . 2.9 iorldbrSk t Es- mEa drBeurg farBfddlnFa.datu.bieif' B1idd1niAfusifCosua Paraguarn- Ita3.34.184.615.93 Ita-Cuatro Mojonesl8.423.8724.9634.6 Cuatro Mojones-Jct Rt 926.938.2047.056.51 Umpio-Emboscada6.2-4.524.98 Resurfacing Route 66.1-6.769.24

Protracted procurement process. The process of contracting civil works and consulting services was permanently delayed, time consuming and out of the average bank standards in terms of execution time. These factors contributed substantially to the need to extend for twenty four-month the closing date of the project

Lack of experience in resettlement programs. The MOPC lacked previous experience in managing complex land acquisition, relocation of affected people and resettlement procedures as specified by Bank resettlement guidelines.

Project Monitoring. The key performance indicators identified at the Mid-term review through formulation of a project logical framework was not followed by MOPC to monitor and supervise outcome such as statistics operation of poIts, periodic traffic survey, traffic counts on access to ports, among others. Also, the project did not plan nor budget for any impact evaluation study, or the collection of data, which might have been useful to evaluate the outcome and impact of the project. The most extreme example is the soil stabilization pilot program which successful implementation depends on a thorough monitoring and evaluation process. However, monitoring has been incomplete (not on a monthly basis and only including visual inspections) and evaluation is still pending.

- 12 - Inappropriate grouping of roadsfor bidding. The project included cumbersome procurement of works procedures while Asunci6n's ringroad was the only complex road that required prequalification. Also, the prequalification process was excessively long taking up 24 months.

5.4 Costs andfinancing: As per October 31, 2001, the total cost of the project amounted to US$136.29 million equivalent, which is 51 percent higher than the appraisal estimate of US$90 million equivalent. The Government counterpart funds increased substantially from US$25 million planned at appraisal to about US$71.3 million, principally to finance road construction cost overruns.

The most significant source of increase was the high cost of the road improvement component, which jumped to about US$122.48 million from about US$70 million. This increase was primarily caused by cost overruns of Asunci6n's ringroad and Ita-Cuatro Mojones road subprojects. The actual cost of widening and improvement of the ringroad was about US$6,717,556 per km compared to an original estimate of US$2,933,780 per kIn, while for Ita-Cuatro-Mojones, costs jumped to US$1,049,946 per km from US$650,939 per km. The project, at appraisal, was to be financed 72% by the Bank and 28% by the GoP; while the actual figures are 47.7% and 52.3% respectively. Project costs details are given in Annexes 2a (Project Costs by Component), 2b (Project Costs by Procurement Arrangements) and 2c (Project Financing by Component).

6. Sustainability 6.1 Rationalefor sustainabilityrating: Sustainability of the project is rated unlikely. The Loan Agreement (Section 3.04) provided that borrower should allocate resources of an amount equivalent of US$ 14.2 million annually to finance the maintenance of roads. Over the life of the project, the Borrower has complied with this requirement, which contributed to the conservation of the road network. However, taking into account the current severe fiscal crisis, the low level of actual financial resources allocated to road maintenance, and the absence of a sustainable road maintenance financing mechanism, there is a high risk of deferring road maintenance, which would result in a rapid deterioration of the national road network.

It is recommended to discuss with GoP the desirability of a follow-up project in order to enhance sustainability of the completed project and to assure continuity and consistency in the reform of the transport sector. A follow-up project could comprise investments related to the improvements of the drainage conditions along the Ytay and Lambar6 creeks, TA to facilitate outsourcing of road maintenance and concessioning of roads, and supporting MOPC's institutional development.

6.2 Transition arrangementto regular operations: In order to ensure the sustainability of the project's investments and institutional achievements, several actions or transition arrangements to regular operation are needed: (i) continue the transferring of resources in timely manner to the Conservation Department for the maintenance of the road network, giving priority to the newly rehabilitated roads; (ii) increase road maintenance outsourcing by expanding the performance-based maintenance contracts pilot program; (iii)

-13 - initiate the road concession program of 811 km that will cover the maintenance of southern access (Paraguari-Ita-Cuatro Mojones) and the rehabilitated 100 km of Route 6; (iv) complete the pilot soil stabilization program to reduce the road closures and maintenance costs of rural roads by adopting low-cost stabilization technologies; (v) continue monitoring environmental and socio-economic impacts of construction and rehabilitation of roads and upgrade the EU to a Department Level; and (vi) continue with the technical staff training program proposed by consultants.

In accordance with the proposed project logical framework, the optimum timing for a future impact evaluation will be year 2003.

7. Bank and Borrower Performance Bank 7.1 Lending: The Bank's performance during the project preparation stage is rated marginally satisfactory. A multi-disciplinary team prepared the project with additional inputs from sector experts. The sector strategy approach (project objectives were relevant and aligned with CAS), the technical and economic viability of the selected roads were thorough and comprehensive. The team also developed a complete set of terms of reference to hire consultants to prepare the engineering studies, the pilot stabilization program for unpaved roads, and the institutional development component. The project covered most of the sector transport issues.

In hindsight, the project team could have spent more time on: developing a comprehensive resettlement program following Bank's guidelines (estimating the time, plan of action, external factors and surrounding environment, key milestones, core group, etc.); assessing the role of CONAVI assisting involuntary resettled population; designing a better institutional set up to execute the project especially after a long period of inactivity which resulted in a lack of experience and professional capacity; assigning resources for the administration of the project: assessing borrower financial, procurement and workload capacity; reviewing technical feasibilities studies; and in preparing monitoring indicators to measure impact, outcome and outputs, and carefully analyzing the Bank conditionality of not disbursing funds for four roads until completion of the resettlement program. As a result, the loan had very limited disbursements until late 1997, almost three years after signing the loan.

7.2 Supervision: As discussed earlier, the project suffered major startup delays. The supervision of the Bank is characterized by two distinct phases: a first phase rated unsatisfactory and a second phase rated satisfactory. The first phase which covers the implementation start until mid term review is rated unsatisfactory. It was characterized by less proactive stance, lack of timely feedback and poor results on the ground, despite 3 supervision missions a year. MOPC commented that the communication with the Bank suffered during this period. There were two task managers both of them transport engineers.

The second phase started at mid-term review in 1997, when the project status changed to a satisfactory performance. The Bank developed a project logic framework defining impact and output performance indicators and identifying the implementation risks. Good supervision

- 14 - reports, adequate plan of actions and a better dialogue between the Bank staff and the MOPC staff characterized the second phase. Supervision reports highlighted major project implementation issues and corrective measures agreed upon such as the lack of counterpart funding, difficulties regarding construction of roads, the substantial increase in cost due to additional works, and the modification of disbursement procedures. In general, the Bank team did a good job of supervising the physical works of the project. However, there were also some shortcomings in the supervision during this period, as flagged by a Quality of Supervision Assessment for FY00, which rated supervision performance marginally satisfactory for that year. The QSA found difficulties in the handling of compliance with financial management requirements, poor attention to the institutional strengthening component, inadequate skills mix of supervision teams, and the incomplete use of performance indicators. However, through a joint affort of sector management and the new TTL these issues were addressed during the last year of supervision, resulting in clean audit reports for 1999 and 2000 and an Action Plan for institutional strenthening. On average, the project was supervised twice a year and implementation progress and ratings were adequately reported. There were three task managers during this phase. The Bank conducted 15 supervision missions and the project supervision took a total of 142 staff weeks.

7.3 Overall Bankperformance: Overall Bank performance is rated marginally satisfactory, despite less-than satisfactory performance during preparation and early years of supervision. Early advice was given to the Borrower on the scope of the ICR, and the definition and measurement of performance indicators linked to objectives as planned at the Mid-Term Review with the Logical Framework of the project. Problems identified by the QSA for the FY00 supervision period were addressed adequately.

Borrower 7.4 Preparation: Borrower performance during preparation is rated marginally satisfactory, despite the poor quality of engineering design for road improvement, which generated substantial cost overruns, and despite the poor preparation of the resettlement program. However, the Borrower participated actively in the preparation of the project. MOPC staff with the assistance of consultants prepared the various technical and economic analysis of the project.

7.5 Government implementation performance: Government implementation performance was marginally satisfactory overall. Despite several periods of insufficient counterpart funding, the project received high priority from the Government relative to other donor financed projects, particularly in its physical components. The Government showed its strong commitment to the project by increasing the local counterpart fund share from US$25 million to US$71.3 million, the timely allocation of budgetary resources for maintenance of the road network as planned in the loan agreement, and its willingness to continue supporting the financing of Asunci6n's ringroad to completion by allocating the required resources for the fiscal year 2002 which helped to attain all project objectives. Less satisfactory were the long institutional battle over where to locate the Vehicle Registry and the cumbersome bureaucratic procedures for processing international contractor payments.

- 15 - 7.6 Implementing Agency: MOPC performance was marginally satisfacory as well. In terms of project management during the startup, the project was unsatisfactory. MOPC showed lack of commitment to resolving the voluntary and involuntary resettlement in a timely manner. In hindsight, the agency could have dedicated more staff, more resources, better planning and more coordination between the Assessment, Legal and Finance Departments and the Environmental Unit. According to the appraisal, the latter was supposed to be in charge of coordinating the implementation and supervision of the resettlement program but this never happened. Also, the lack of a core team dedicated to the project on a full time basis created a protracted procurement process, especially during the prequalification process for the first three roads. While the centralization of fmnancial accounting functions within MOPC resulted in inadeqaute project financial accounting which was flagged in the 1999 Audit Report, MOPC responded adequately upon notification by the Bank resulting in an unqualified audit opinion for 2000.

7.7 OverallBorrower performance: Overall Borrower performance is satisfactory. Throughout the implementation period, the Borrower maintained a strong commitment to attaining the project's physical targets. The limited perfornance of the implementing agency was balanced by the Government's good performance and further counteracted by the achievements registered by the project at the end.

8. Lessons Learned Key lessons learned from the Paraguay Eighth Highway Project are:

A. Project Design and Policy Implications

(a) Project design to reflect project complexity. The scope of the project was correctly identified and appraised but it was overly ambitious, because it included the rehabilitation of the Asunci6n's Ringroad, a key urban transport road, without appreciating the problems originating from the complex traffic and environmental characteristics of this road and the inexperience of the country with applying the Bank's safeguard policies. The complexity is reflected in the civil works and services which include (i) the construction of three viaducts, the improvement of three main intersections and a canal storm-drainage, sewage works and (ii) the implementation of an involuntary resettlement program, which had more than three hundred properties. A two-phase project design with a first phase including the less complex civil works in terms of resettlement and procurement to gain experience in this unfamiliar area, followed by a second phase that included Asunci6n's Ringroad would have provided more time for a thorough preparation of the Ringroad component.

(b) Carry out the engineering designs studies before bidding and avoid delays in the design-bidding-start of works process. Underestimation of construction costs in the design phase lead to higher than expected bids and significant cost over-runs during construction. The higher costs were caused by: (i) the lack of detailed engineering designs as part of the bidding documents; and, (ii) the long time lapse between studies and start of civil works which confronted contractors with outdated studies. Experience has shown that unless detailed and updated engineering design studies are available before bids are requested, the financial bids received from

- 16 - contractors are often much higher than the estimated construction costs to cover the additional risk. Also, in those cases where construction bids were based on incomplete or outdated design studies, technical specifications needed to be modified during construction and additional works were necessary, which also contributed to higher than estimated construction costs.

(c) Include sustainability enhancing conditions in the Loan Agreement that can be simply monitored. The Loan Agreement (Section 3.04) stipulated that the Borrower had to allocate resources in an amount of US$ 14.2 million equivalent annually for the purpose of financing the maintenance of road network. During the implementation of the project, the Borrower has complied with this requirement which was relatively simple to monitor. Apart from contributing to the conservation of the national road network, this helped to initiate a maintenance policy dialogue with Government.

B. Project Implementation

(d) Follow through with the use of project monitoring indicators, select key measurable institutional indicators, and assign a monitoring and evaluation responsibility to the implementing agency. Although not included in the project design, the project, at mid term review, developed a set of monitoring indicators to measure output, outcome and impact. However, MOPC failed to understand its purpose and did not use them for project management or as a monitoring tool "early warning device", thus reducing effective monitoring and complicating measuring progress in fulfilling the development objectives. In addition, the project did not include appropriate indicators for the institutional component. The monitoring and evaluation of effectiveness of the institutional component could have been improved with the inclusion of clear and measurable indicators. Without these indicators, it was difficult for Bank supervision teams to identify delays and issues early enough to propose timely remedial measures. Clear responsibility for planning and monitoring project performance and targets must be allocated to the implementing agency.

(e) Design Project Implementation Arrangements carefully. Successful implementation of the project depends to a large extent on the establishment and operation of an adequately staffed or well managed Project Special Unit or core team, qualified and fully trained at the out set to properly apply administrative and financial management procedures, including procurement and disbursement. In a country such as Paraguay, where institutional weakness in the public sector is common, effective project implementation requires use of Project Special Units or the assignment of a core team on a full time basis until the overall public service has been strengthened. In this sense a complete Operational Manual is required.

(I) Assess organizational capacity prior to the start of project implementation. The organizational and institutional capacities of the implementing agency need to be assessed adequately, in particular the resources allocated to administration, personnel, procurement, training and budget. In addition, attention should be paid to data collection and management. During the 8-years of project implementation, various units and staff kept relevant project data separately in different departments. Since there was not a central data system or unit, it took a long time to pull together the information required for the ICR.

- 17 - (g) Prepare the Resettlement Plan well before project appraisal, define key indicators and monitor implementation. All preparation activities related to land acquisition, resettlement, relocation of affected people and financial resources should be completed well before securing the financing that will support the investments and the start of the civil works procurement. The experience in the implementation of the Resettlement Program provides the following lessons: (i) the Government's capacity and commitment to pay compensation in a timely manner as scheduled should be verified up-front; (ii) develop a follow-up plan, (iii) assess the implementing agency capacity to execute the program; (iv) assign a project team on a full time basis during the implementation of the resettlement; (v) revise status of land tenurization and land registration system within the municipality or city; (v) provide financial, technical, social and legal assistance to the agency in charge of the resettlement; (vi) monitor closely with key indicators and expected results; and (vii) assign financial resources for impact evaluation or survey after the execution of the resettlement.

(h) Lack of continuity in political environment and project management negatively affect implementation. Successful implementation of the project is highly dependent on the stability of key project management staff, both at the local and Bank levels, and a stabile political environment. Project implementation suffered from various changes in Ministers, projects coordinators and, on the Bank side, task managers. The project implementation organization should be located high enough in the Ministerial hierarchy to have easy access to decision makers and to permit fluid, constructive dialog with other operational units.

(i) Implementation capacity problems require intense supervision, to be reflected in supervision budgets. Bank supervision missions should be geared to provide technical support to local implementation staff in order to keep the basic concepts of project design on track and to discuss required mutually acceptable adjustments. In addition, missions should be equipped to assist in resolving questions of administrative detail delaying or impeding project implementation. Where implementation capacity is weak, missions should include technical, procurement and financial specialists as required, not only in the initial stages of project implementation, but over the life of the project. Where the QAS noted insufficient skills mix of supervision missions, the large amount of technical issues requiring the task manager's attention already drained the supervision budget, making more frequent and/or various expertise missions impossible. 9. Partner Comments (a) Borrower/implementingagency: A final evaluation report prepared by the Borrower is included in the Annexes. The Borrower's conclusion is that despite the difficulties encountered during preparation and implementation of the Project, most of the project objectives were achieved satisfactory, substantially contributing to the country's progress. The project was instrumental for the development of safer and quicker road infrastructure, prompting socio-economic growth in the affected areas, creating employment, improving access to health and education services, and contributing to a reduction in transport costs which promoted commercial activities and tourism.

- 18 - Although various changes in Government caused implementation delays in the institutional strengthening component, significant progress was made in strengthening the organization and management of the administrative processes and various intraministerial committees were established as per the Bank's recommendations, such as for Strategic Planning and Human Resources.

Despite a deteriorating macro-economic situation over the life of the project, Government remained committed to its implementation and compliance with obligations included in the Loan Agreement. The extreme complexity of the project, the lack of local experience with such complex works, the first time use in Paraguay of standard World Bank documents and safeguard policies, all contributed to delays in implementation: local technical and administrative procedures and documents had to be adapted to these standards with frequent less than optimal results and extensive interpretation discussions.

The Borrower's technical observations focus on the importance of improving the quality of engineering designs and establishing quality control mechanisms, the necessity of developing a National Road Investment Strategy and management information system, and the need for training government and private sector professionals in new construction and maintenance methods and administrative processes. (2) Cofinanciers: Not Applicable (c) Otherpartners (NGOs/private sector): Not Applicable 10. Additional Information

- 19 - Annex lo. Key Performance Indicators/Log Frame Matrix

Annex la Key Performance Indicators/Log framework

Key Performance hdRataors SAR Estimate Actual NT D 7t.^n~MPONENT

A. Road Impronvements Km Km

Civil Works I (Paraguari - Ita) 24.00 22.65 Civil Works II (Ita - Cuatro Mojones) 34.60 35.80 avil Works III ( Cuatro Mojones - Jct. Rt 9) 12.30 10.50 (85.5%) Civil Works IV ( Limpio -Emboscada) 17.00 17.20 Land Acquisition (properties) 512 550

., Road Rehabilitation Civil Works V (Resurfadng Route 6) 100.00 100.00

ClviII Works VI. Stabilization Program 40.00 31.30

IZ. CONSU7dTlN SERVICES

l sgDnaserD Services

Civil Work Supervision Civil Works Supervision Executed Design Rehabilitabon of RT. 6 Study Executed Pilot Stabilization Program Pilot Study Program Executed Engineering Design of Creeks Study Executed PPF Engineering Services Detailed Engineering Design Roads Executed

B. Studies

Asunci6n Transportation Master Plan Study Executed PPF Environmental Studies Study Executed 7 anchn1csO Anssistance &Training

MOPC's Management Strengthening Study Study performed Environmental Unit Workshops &Training Executed DPP Strengthening Workshops & Training Executed National Vehicle Registry National Vehicle Registry Implemented by Ministry of Justice

PPF TA Expenditures Studies Studies performed Il2= EQUIPMENT Computers and software Equipment installed

- 20 - Annex lb Key Indicators for Project Operation

Project Conpia,ents Unit SAR Estimate Actual ROADS C:vli Wosrks 1t Paraguari Ith1 Km 24.00 22.65

Clvlg Works 11 (Iti Cuatro Mojones) Km 34.60 35.80

Civil Works III (Cuatro Mojone3ct. Rt9) Km 12.00 10.50 3 Viaduct, at grade crossing with signal lights, otary, storm drainage improvements Civil Works IV (LimpleEmboscada) Km 17.00 17.20

Clvii Works V (Resurfacing Route 6) Km 100.00 100.00 Clvil Works VI (Stabilization Program) Km 40.00 31.30 MOPC's RoadMalntenance budget US Million 1994 10.70 13.7 1995 14.20 17.4 1996 14.20 18.2 1997 14.20 15.9 1998 13.00 15.9 1999 13.00 11.2 2000 13.00 12.5 2001 13.00 12.0 Average Traffic (IMD) Vehides per day 1 990 2001 Total Trucks Total Trucks Paraguari - Ita 2 450 653 5 090 1001 Its - Cuatro Mojones 5 147 774 19.430 2 324 Cuatro Mojones - ]ct. Rt 9 12 131 1 607 16 476 2 109 Umpio -Emboscada 647 332 1 488 477 Resurfadng Route 6 1 646 431 verage Road Roughness IRI Paraguari - RI 3 2.5 RI - Cuatro Mojones 3 2.5 Cuatro Mojones - Jct. Rt 9 3 2.5 Limpio -Emboscada (Route 3) 3 2.5 Resurfadng Route 6 3 2.5 TuOI freolglh Ports (1996) Ports (2000) Asund6n Private Asund6n Private Ports Ports Exports Thousand tons 108 295 168 603 Imports Thousand tons 222 930 170 1 034 Cabotage Thousand tons 5 3

Total freight . Ports (1996) Ports (2000) Asund6n Villeta Asund6n Villeta Exports Thousand tons 108 83 168 183 Imports Thousand tons 222 46 169 49 Cabotage Thousand tons 5 71 3 339

-21 - Annex Ic Studies included in project

StudF- Purp"ose ' sia - -- Impact of Study

1. Engineering Designs for Engineering design for the rehabilitation Completed Road rehabilitated resurfacing Route 6 of 100 km

20 Urban Master Plan for the This study provides medium and long- Completed The study will improvE great Asuncion Area term investments in the Asundon urban drainage and safety o area. Asuncion's main accesses

EngineeringDesigns for Ytay Improve drainage conditions along Ytay Completed Reduce flooding alon and Lambard creeks and Lambare creeks hese two creeks due t construction of Asuncion' Ring road. To be finances by GOP or follow o operation.

4. Pilot Program of EarthRoad Determinate specifications and Application of agents Reduce the maintenance Stabilization operation and maintenance completed. cost of unpaved roads comparative M&E incomplete .______costs of soil stabilization agents

5. Strengthen MOPC's Design improved macro-management Phase I Completed Raise the effectiveness Organization methods to help MOPC discharge its Phase 11completed and efriciency of the Phase I- Diagnosis, responsibilities in a more effective and MOPC's overall Recommendations, Discussio cost efficient manner, taking into organizational performance and ExamInation of account the strategic altematives Alternatives, Development ol available to the MOPC to accomplish its the Plan of Action, Initial objectives Implementation and Preliminary Assessment of Results Phase II- Evaluation of the Results of the Plan of Action :mplemnentat,on's

- 22 - Annex Id Institutional Arrangements of the Project

Components Executing Agency Operation & Maintenancet continuity of Program Road Rehabilitacon Directorate of Highways Under secretanat of Public lWVorks Road Maintenance Directorate of Highways Under secretariat of Public Works Nabonal Vehide Registry Directorate of Land Transport Minisbry of Justice und6n Transport Master Plan Planning Office Under secretariat of Transport

Annex le Road Works Costs Tables

I, fl,nTriabon pe, Rcraj Seetior, r,fraJS Estinatets (COssIr 199 uis'3

LUrrigdl th Idth Wonrk 'Work 1hoo Costs i C 6:,st'Kri1

(|kn) (.i i CIls5 I '_. lcLr'. tv ('JS1 m0iit'o, (L`L$SrKm) Road Improvements 87.90 70.5 802,105 Paraguari - Ith 24.00 n.a. Improvements Rehabilitation Overlay 4.1 171,898 Ita - Cuatro Mojones 34.60 n.a. Improvements Widening Widening to 4L 22.5 650,939

Cuatro Mojones - Jct. Rt 9 12.30 n.a. Improvements Widening Widening to 4L 36.1 2,933,780

Umpio -Emboscada (Route 3) 17.00 n.a. Rehabilitabon Reconstruction Reconstruction 7.8 457,147 AC

Resurfadng Route 6 100.00 n.a. Rehabilitabon Rehabilitation Overlay 7.3 72,510 CPNilo Stabilization Prqpnm 40.00 n.a. Preservaton Preventive Stabilization 1.2 29,895 I_Pedodic Treatment _

inroniation r- Roacl Selertio4, AppLsal rsbrnates,',costE in 2OO UJS$

Leritth WViitn l/VLrl l'VirKWork I ts (I 1 (,st/Knr

(k rr') {ri ').uasS T ^pe ALtv :-I, (IJS$ rniih-on, ."I SS, i n'-) IA Road Improvements 86.15 122.48 1,421,706

Route 1. Paraguari - Ib 22.65 n.a. Improvements Rehabilitabon Overlay 7.28 321,523 ItA - Cuatro Mojones 35.80 n.a. Improvements Widening Widening to 4L 37.59 1,049,946

Cuatro Mojones - Jct. Rt 9 10.50 n.a. Improvements Widening Widening to 4L 70.53 6,717,556

Umplo -Emboscada (Route 3) 17.20 n.a. Rehabilitation Reconstruction Reconstruction 7.08 411,343 AC lr Road1 RehablDitation Resurfadng Route 6 100.00 n.a. Rehabilitation Rehabilitation Overlay 10.13 101,30 C. Pilte Stabilization Progra 31.30 n.a. Preservation Preventive Stabilization 0.57 18,211 -. - Periodic Treatment (1) Costs include Land Acquisition, design, supervision, works and contingendes.

- 23 - Animnem 2. 1Firoject Costs and Financing Annex 2a Project Cost by Component

Appraisal AuWatl~i4wii Percecftagje of Project Cost By Component Estimate Estinmate Appraisal US$ million US$ million I. ROAD COMPONENT 79.00 133.18 1690/ A.Road Improvements 70.55 122.48 174% B. Road Rehabilitation 7.25 10.13 1400/ C.Pilot Stabilization Program 1.20 0.57 480- IL CONSULTING SERVICES 10.40 2.93 280/ A. Engineering Services 6.74 0.28 4/ B. Studies 0.71 0.25 350/ C.Technical Assistance & Training 2.95 2.40 810/ III. E~QUIPMENT 0.60 0.18 300/ OTL PR0WECT COSTS 90.001 136.29i 1510/

Annex 2b Project Costs by Procurement Arrangements (Appraisal Estimate) (US$ million equivalent)

j~~t~~4ft*~~~~ Procuremnent Mathod)

Categorles ______ipraisal lEstimate______ICI NCB Other NBF Total L.Civil Warkw 72.80 1.20 5.00 79.00 (56.20) (0.80)(00)57) 2. Equipment 0.60 0.60 (0.40) (0.40) 3. Consulting Services ~~~~10.40 10.40 (7.60) (7.60) TOIrAL ~~~~~72.80 1.20 11.00 5.00 90.00 (56.20) (0.80) (8.00) (0.00) (65.00)

-24 - Annex 2c Project Costs by Procurement Arrangements (Actual/Latest Estimate) (US$ millions/equivalent)

Expenditure Procurement Methodt" Categories l Actual/Latest Estimate ICB NCB Other NBF Total I.Clvhi Works 119.97 0.30 13.00 133.27

______(64.52) (0.30) (0.00) (64.82) o. Equipment _ 0.18 - 0.18 (0.17) (0.17) S. CoFIsuBtIng Services 2.84 2.84 (0.01) (~~~~~0.01) TOTAL 119.97 0.30 3.02 13.00 136.29

(64.52) (0.24) (0.18) (0.00) (65.00)

(1) Figures in parenthesis are the amounts financed by the Bank loan. All costs include contingencies.

Annex 2d Project Finandng by Component (in US$ million equivalent)

Conmponent Appraisal Estimate Actual/Latest Esftmatel Percentage ofAppraisali Bankl | Govt. Bank Boat. Govt 1. ROAD COMPONENT 57.00 22.00 61.90 71.28 109% 324% A. Road Improvements 50.76 19.79 56.09 66.39 111% 336% B. Road Rehabilitation 5.44 1.81 5.29 4.84 97% 267% . Pilot Stabilization Program 0.80 0.40 0.51 0.06 64% 15% I. CONSULTXNG SERVICES 7.60 2.80 2.92 0.01 38% 0% . Engineering Services 5.70 1.04 0.27 0.01 5% 1% B. Studies 0.50 0.21 0.25 50% 0% C. Technical Assistance & 1.40 1.55 2.40 171% 00/0 Training Ill EQUIPMENT 0.40 0.20 0.18 45% 0% OTAL 65.00 25.00 65.00 71.29 100% 285%

Annex 2e Financing (in US$ million equivalent):

[ Estimated DIn Actual XDI I Bank 65.00 72.22% | 65.00 | 47.69% Govemment 25.00 27.78% 71.29 52.31% TOTAL 90.00 100.00% 136.29 100.00%

- 25 - Annex 3. [aonovnc Costs and Benen HS

Com,ponef"t SAR Estimate Actual Costs NPV IERR Costs NPV IERR US$ US$ US$ uss ______. .millionm illion _ m illion million ______._ A. Road gmpravemenf___ Paraguarf - Ita 4.0 l 8.90°/ 7.3 23.8 Ita - Cuatro Mojones 23.0 14.300/4 37.6 27.1 Cuatro Moiones -Ict. Rt 9 36.6 27.40°/a 70.5 18.8 Umpio -Emboscada (Route 3) 7.7 = 10.80°/ 7.0 26.3

Resurfacing Route 6 1 7-3 10.0 1 28.4

- 26 - Annex 4. Bank Inputs (a) Missions: Stage of Project Cycle No. of Persons and Specialty Performannce Rating (e.g. 2 Economists, I FMS, etc.) Implementation De%elopment MonthvYear Count Specialty Progress Objective

Supervision 04/08/1994 2 TM, (TE), TE S S 08/11/1994 2 TM, TE U S 01/20/1995 2 TM, TE U S 0707/1995 2 TM, TE U S 11/10/1995 2 TM, TE U S 02/16/1996 1 TM U S 05/24/1996 2 TS, TE U S 10/10/1996 2 2 TE's U S 06/27/1997 2 HE, TS U S 12/06/1997 2 TM, TS S S 06/26/1997 2 TM, HE S S 11/25/1998 2 TM, HE S S 06/19/1999 2 TM, E S s 12/12/1999 2 TM (TS), SD S S 06/30/2000 1 TM S S 10/25/2000 3 TE, HE, FS S S ICR 04/05/200 1 2 TM, FS S S EN - Engineer, EC - Economist, ENV - Environment Spedalist, FS - Financial Spedalist, HE - Highway Engineer, SD - Social Development Specialist, TE - Transport Economist, TM - Task Manager, TS - Transport Specialist.

(b) Staff:

Stage of Project Cycle Actual/Lalest Estimate No. Staff weeks US$ ('000) Supervision 142.2 538.4 ICR 1.4 26.0 Total 315.1 1051.6

- 27 - Annex 5. Ratings for Achievement of Objectives/Outputs of Components (H=High, SU=Substantial, M=-Modest, N-Negligible, NA=Nct Applicable) Rating L Macro policies O H OSUOM O N * NA Sector Policies O H OSU*M O N O NA [9 Physical O H *SUOM O N O NA ED Financial OH OSUOM ON *NA F Institutional Development 0 H * SU O M 0 N 0 NA E Environmental O H OSU*M O N O NA

Social Ol Poverty Reduction O H OSUOM O N * NA Ol Gender OH OSUOM ON *NA O Other (Please specify) OH OSUOM ON * NA * Private sector development 0 H * SU O M 0 N 0 NA * Public sector management 0 H O SU O M 0 N 0 NA O Other (Please specify) O H OSUOM O N * NA

-28 - Annex 6. Ratings of Bank and Borrower Performance (HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory)

6.1 Bank performance Rating

D Lending OHSOS OU O HU El Supervision OHS OS OU OHU El Overall OHS OS O U O HU

6.2 Borrowerperformance Rating

El Preparation OHS OS O u O HU E Government implementationperformance O HS O S 0 U 0 HU El Implementation agency performance OHS OS O U O HU El Overall OHS OS O U O HU

- 29 - Annex 7. List of Supporting Documents

* Project Supervision Reports 1994 - 2001 * Amendment to the Loan Agreement 1999 * Amendment to the Loan Agreement 2000 * Quality of Supervision Assessment FY00 * Project Files * Economic Evaluation ex-post of Higways VIII civil works, November 2001

- 30 - Additional Annex 8. Logframe: Mid-Term Review

PARAGUAY Eighth Highway Project (Loan 3685-PA) Mid-Term Review Log Frame Monitoring and Critical Risks and Narrative Summary Key Performance Indicators Supervision Assumptions CAS Objective By year 2003... (CAS Objective to Bank Mission) Support efforts to achieve * exports handled through the ports of * Statistics operation * Paraguay's macro-economic long-term sustainable growth San Antonio and Villeta increased of Ports conditions remain favorable; within the context of over the 1994 levels at a pace * Periodic traffic * Government furthers its MERCOSUR by improving greater than that for the Asunci6n surveys OPIT commitment to increasing the conditions for attracting Port; * MOPC's annual private sector participation in private investment and * traffic flows along the system of reports infrastructure. improving the efficiency of access to Asunci6n freed from the * Infrastructure projects support public investment. interferences experienced in the economic growth and provide past due to major flooding or equitable access to the excessive congestion in key road poorer/disadvantages groups junctures; * use of private sector resources in undertaking and/or financing road activities increased by contracting out/delegating to third parties 100% of activities along international corridors and 50% along the trunk and rural roads systems; * MOPC's capacity to implement projects strengthened, increasing annual budgetary execution from 50% in early 90s to not less than 90%, and accomplishing 90% of physical targets under its investment plan on time and within budget as planned; . road closures and maintenance costs of rural roads reduced by adopting low-cost stabilization technologies

- 31 - Narrative Summary Key Performance Indicators Monitoring and Critical Risks and Supervision Assumptions Project Development By year 2000... (Dev. Objectives to CAS Objectives * the environmental hazards and the * Traffic surveys Objective) * Reduce urban problems nuisance caused by frequent major performed by OPIT. * Current trend in intemational through works which reduce floods along Asunci6n's ringroad * Completion of trade to/from the ports of flooding of and congestion eliminated through improvements to paving works on Rt. Villeta and San Antonio along Asunci6n's ringroad the road and drainage system; 3 between continues within the plans with medium and long-term Emboscada and Cnel MERCOSUR framework; improvements to eliminate flooding in Oviedo with IDB * MOPC's capable of managing the Great Asunci6n area, and final funding; a large investment program, engineering for-improvement of the * Traffic counts on which entails a two to three- Ytay and Lambar6 creeks made access roads to ports fold increase in spending available for implementation under of Villeta and San levels. follow on operations; Antonio. * Funding for the medium and * the level of service (expressed by the * Final reports long-term plan to eliminate volume/capacity ratio) on Asunci6n's prepared by flooding in the Great Asunci6n ringroad and the existing road from consultants. area becomes available. San Lorenzo to Ita increased, as a * MOPC remains committed to result of widening the road and implementing the long-term building viaducts in the thtee most * Monitoring of plan for institutional * Facilitate the use of trafficked intersections, and of MOPC's institutional strengthening after completing altemative ports: deviating about 20-50% (depending strengthening those activities funded by the on section) of existing traffic onto new program project. * Reduce transportation costs south access; of exporting soybeans to * travel distance between northem part Brazil: of the Regi6n Oriental and Asunci6n reduced by 80 km after paving the * Improve sectoral Limpio-Emboscada (north access) management and planning road and the Emboscada-Tacuara links capabilities within MOPC on Rt. 3 included in the IDB-funded project; * accessibility to the ports of Villeta and San Antonio improved by upgrading the Asunci6n ringroad and its north and south accesses; * pavement condition of Rt 6 between Rt. 7 and Km 100 improved and vehicle operating costs lowered through a 23% reduction in average roughness indicator (to IRI=2 after its resurfacing in 1999) * program for strategic planning implemented within MOPC by end- 1998 and interaction among MOPC areas enhanced; * performance indicators for MOPC's administration and finance area achieved by end-1998; * MOPC's human resource- base strengthened by implementing by end- 1998 (1) a training program in project management, and (2) a performance management system for staff; * low-cost technologies for stabilization of unpaved roads successfully tested and adopted by MOPC for routine application in other projects;

- 32 - Monitoring and Critical Risks and Assumptions Narrative Summary Key Performance Indicators' Supervision Project Outputs By year 2000 * Project supervision * (Outputs to Dcv. Objectives) * Key road links improved or * about 58 km of roads in the south access to reports and * Functioning of improved drainage rehabilitated Asuncion improved Implementation system not hampered by (I) * Studies and technical * about 12.3 km of the ringroad between Completion Report, inadequate maintenance of assistance programs under Cuatro Mojones and Rt. 9 widened to four * Annual audits of infrastructure, and (2) rapid, poorly the project successfully lanes, three viaducts built, and two main project accounts, planned urbanization of area. completed. stomm-drain canals improved; * Evaluation ofresults * Paving of Rt. 3 links included * about 17 km of roads in the north access to by MOPC under under the IDB-funded project Asuncion paved; Phase 11of the completed as planned. * about 100 km of Rt. 6 resurfaced; institutional * about 40 km of unpaved roads stabilized strengthening with low-cost technologies; program. * investment and institutional plans adopted by MOPC and the municipalities in the Great Asunci6n area to (1) eliminate flooding along the area, (2) improve traffic flows through major intersections and roads providing access to Asuncion; and (3) improve traffic safety; * macro-management methods dtsigned to help MOPC discharge its responsibilities in a more effective and cost efficient manner; * environmental awareness within MOPC and other related agencies increased and social assistance policies adopted for use in other projects that need relocation of vulnerable people Project Components By mid-term review (mid 1997) (Components to Outputs) * Improving the northem and * acquisition of land and resettlement of * Certification that * Project completion not hampered southem road accesses to people affected by the upgrading of land has been or significantly delayed by: (i) Asunci6n and the Asunci6n Asunci6n ringroad and south access purchased and shortages in, or untimely release Ringroad completed; affected people of, counterpart funds, (ii) * Rehabilitating Route 6. * contracts for improvement of access to compensated/re- contractors' lack of capacity to * Piloting unpaved-road Asunci6n (Works 1,n and 111)awarded; located, undertake the works within the stabilization technologies * engineering designs for resurfacing of Rt. 6 * Work and agreed timeframe, and (iii) * Providing engineering completed; supervision contracts inability of MOPC and its services to supervise civil * consultant for engineering the pilot issued, supervisors to control costs during works and design the pilot unpaved road stabilization program hired. * Reports prepared by work execution; unpaved road stabilization * final designs for improvement of the Ytay consultants. * Coordination between MOPC and program, the resurfacing of and Lambar6 creeks completed; * Receipt of works by the mumicipadities of the Great Route 6, and the * Phases I and n of Asunci6n Transportation MOPC Asunci6n area enhanced. improvements to the Ytay Master Plan completed; and Lambar6 creeks; * First phase of technical assistance program * Carrying out the Study for completed and Implementation Plan agreed Asunci6n Transportation upon; Master Plan. By project end (end 2000) * Strengthening through * All civil works completed; technical assistance MOPC's * results of pilot unpaved-road stabilization organization and program appraised; management, DPP and EU. * Study for Asunci6n Transport Master Plan completed (Phases m -I); * Second Phase of technical assistance program completed.

Baseline and targeted values should be shown, with the latter divided into values expected at mid-term, end of project and full impact

- 33 - - 34 - Additional Annex 10. Project Evaluation by Borrower MINISTERIO DE OBRAS PUBLICAS Y COMUNICACIONES

INFORME FINAL DE EJECUCION

DEL

OCTAVO PROYECTO DE CARRETERAS

PRESTAMO No 3685-PA BIRF

Diciembre, 2001

- 35 - OCTAVO PROYECTO DE CARRETERAS

INFORME FINAL DE EJECUCION

INDICE

1. EVALUACION DE LOS OBJETIVOS Y METAS

II. EVALUACION DE LOS RESULTADOS OBTENIDOS

111. DESEMPENO DEL PRESTATARIO

IV. DESEMPENO DEL BANCO MUNDIAL

V. LECCIONES CLAVES APRENDIDAS PARA FUTUROS PROYECTOS

INFORME DE FINAL DE EJECUCION DEL OCTAVO PROYECTO DE CARRETERAS

1. EVALUACION DE LOS OBJETIVOS Y METAS DEL PROYECTO

El Paraguay es un pals mediterraneo ubicado en el centro de la America del Sur entre los rios Parana, Paraguay y Pilcomayo. Linda con Bolivia, Brasil y Argentina. Su economia se basa principalmente en la exportaci6n de soja y algod6n que, juntos, representan mas del 70 % de sus ingresos totales por exportaci6n. Debido a las grandes distancias que se requiere cubrir para llegar a puertos oceanicos de aguas profundas, la eficiencia y los costos del transporte son crucia-les para las exportaciones paraguayas.

La modalidad principal para la movilizaci6n de cargas y pasajeros es el transporte por carreteras, alrededor del 85% del volumen total de transporte para los mercados intemos e internacionales es realizado por carreteras, pues este medio se ha desarrollado en forma mas acelerada por la mayor cobertura territorial que ofrece la red vial, su mayor flexibilidad para atender la demanda de comercializaci6n interna y regional, asi como la de transporte puerta a puerta.

En este contexto, la economia del pals ha tenido un fuerte desarrollo en la decada del 80, para luego sostener un crecimiento mas moderado en la dedada del 90.

- 36 - Sin embargo, la expansi6n y/o mejoramiento de la infraestructura del transporte no acompafn6 al crecimiento mencionado y rapidamente comenz6 a manifestarse la insuficiencia de esta infraestructura como un factor de restricci6n al desarrollo nacional, y como un obstaculo importante para la expansi6n de la producci6n y el comercio exterior.

El Banco Mundial ha participado apoyando al subsector de carreteras desde el ano 1951, financiando la compra de equipos para construir caminos secundarios como parte de un proyecto agropecuario. Desde octubre de 1961 se han aprobado siete proyectos de carreteras, por un total de aproximadamente 149 millones de d6lares.

Por lo expuesto precedentemente, el Ministerio de Obras Publicas y Comunicaciones y el Banco Mundial, han desarrollado el 'Octavo Proyecto de Carreteras", orientado principalmente a la reducci6n de costos de transporte, el desarrollo de los corredores de exportaci6n e importaci6n, desarrollo de carreteras para el fomento de la producci6n agropecuaria y la facilitaci6n del seguro acceso a todos los distritos del pais.

Los objetivos fundamentales a lograr con el 80 Proyecto de Carreteras fueron los siguientes:

a) Fortalecer la organizaci6n del MOPC y promover el trabajo en equipo a su mas alto nivel; b) Mejorar la capacidad del MOPC para construir y entregar caminos de buena calidad y mantener correctamente los mismos; C) Aliviar los problemas causados por la rapida urbanizaci6n; d) Reducir el riesgo medioambiental y las molestias a personas y empresas, causadas por la frecuente inundaci6n del area de circunvalaci6n de Asunci6n; e) Facilitar el uso de los Puertos de Villeta y San Antonio para incrementar exportaciones; f) Reducir los costos de transportes para la exportaci6n de soja al Brasil; g) Mejorar la capacidad de la Direcci6n de Vialidad del MOPC en el diseno y planificacion de obras viales; h) Mejorar la capacidad de evaluaci6n medioambiental; y i) Prestar asistencia al MOPC para establecer el Registro Nacional de Vehfculos.

El proyecto incluyo:

A. Obras Civiles (i) mejoras viales: a) Paraguari-lta-Gurambare-Ypa-ne-Nemby-Cuatro Mojones; b) Cuatro Mojones-Defensores del Chaco-Ma-dame Lynch-Empalme Ruta 9; y c) Limplo-Emboscada; (ii) rehabilitaci6n vial: renovaci6n de la superficie de 100 km de la Ruta 6 entre el empalme con la Ruta 7 y el km 100; (iii) Programa piloto de estabilizaci6n de caminos sin pavimentar: tratamiento de 80 km de caminos sin pavimentar, con aceites sulfonados para probar si el proceso se adapta y es aplicable en el Paraguay;

B. Servicios de Consultoria (i) servicios de ingenierfa para: supervisar las obras civiles, dirigir el pro-grama piloto de estabilizacion de caminos sin pavimentar, disefar las obras de renovaci6n de ia Ruta 6, e ingenieria y diseno de mejoras a los riachuelos Ytay y Lambare;

- 37 - (ii) estudios: preparacion de un Plan Maestro del Transporte para Asunci6n; (iii) asistencia tecnica: examen de la administraci6n del MOPC, asistencia a la unidad del medio ambiente, fortalecimiento de ia capacidad de diseno y planificaci6n de obras viales, y la implementaci6n de un registro nacio-nal de vehfculos; y

C. Equipamiento: Adquisici6n de computadoras para implantar el registro nacional de vehi-culos, y equipos y maquinas para un laboratorio de suelos y materiales.

Durante la ejecuci6n del Proyecto, de manera permanente y con apoyo de las misiones peri6dicas del Banco, se fueron evaluando los avances alcanzados y las dificultades presentadas, por lo que no ha sido necesario la modificaci6n integral de ninguno de los objetivos fundamentales del Proyecto, salvo la implantaci6n del Registro Nacional de Vehiculos puesto que durante la ejecuci6n del Proyecto, ha sido promulgada la Ley N° 608/95 que asigna al Poder Judicial la responsabilidad de ejecutar dicho programa, saliendo del ambito del MOPC, por lo que, al ser eliminado del Proyecto este componente, la adquisici6n de computadoras que se previ6 para el efecto, han sido adquiridas para el fortalecimiento de la Unidad Ambiental y para el Departamento de Evaluaci6n y Control de la Direcci6n de Vialidad. Ademas fueron excluidos del Proyecto, la compra de equipos y maquinarias para un laboratorio de suelos y materiales teniendo en cuenta que dicha adquisici6n estaba prevista en un programa con financiamiento del Gobierno del Jap6n.

Sin embargo, en lo que concierne a las metas establecidas, como resultado del mejoramiento en los disenos iniciales de los proyectos, mayores costos de las obras y disponibilidad de recursos locales, fue necesario realizar reajustes en relaci6n a los costos, plazos y financiamientos previstos

Al realizar la evaluaci6n de Proyecto, es muy importante resaltar que debido al desfasaje entre la realizaci6n de los estudios previos y la ejecuci6n de las Obras, las metas establecidas para dos de ellas no fueron alcanzadas en el tiempo previsto para el ultimo desembolso del Prestamo (15 de junio de 2001), estimandose que se estarfa logrando para el pr6ximo mes de abril de 2002, con financiamiento netamente local. Situaci6n esta, no acorde con los plazos reducidos que exigia urgentemente el pafs para solucionar los graves problemas de acceso a la Capital, principalmente con las inundaciones que se sucedian en la via de circunvalaci6n, que con cada lluvia de mas de 70 mm (normal en el verano) interrumpia el transito por varias horas, quedando Asunci6n sin salida, y una poblaci6n importante directamente afectada por la inundaci6n de su vivienda.

Se presentaron ademas, exigencias de caracter extemo que el Proyecto debi6 superar con el fin de lograr los objetivos y metas propuestas, pudiendo mencionarse entre los mas relevantes a los derivados de la amplitud, complejidad y caracteristicas particulares de la obra civil mas importante del Proyecto como es el mejoramiento de la Avenida de Circunvalaci6n de Asunci6n, tramo Cuatro Mojones-Defensores del Chaco-Ma-dame Lynch-Empalme Ruta 9, donde se conjugan los problemas propios de la ampliaci6n de una via en una zona sub urbana, con los problemas de la canalizaci6n de cursos de agua, con frecuentes inundaciones no solo de la zona de obras sino tambien las viviendas adyacentes, y con desagues pluviales y sanitarios precarios existentes.

Sin embargo, a pesar de los inconvenientes que se afrontaron, la adecuada gesti6n de los responsables administrativos y operacionales de los organismos ejecutores permiti6 alcanzar

- 38 - satisfactoriamente la mayoria de las metas establecidas en el Proyecto, y que estan contribuyendo sustancialmente al progreso del pafs, convirti6ndose el Octavo Proyecto de Carreteras en un factor importante del desarrollo de vias alternativas mas seguras y rapidas, impulsando el crecimiento de diferentes actividades socioecon6micas propias de cada zona, promoviendo la generaci6n de puestos de trabajo, el acceso a servicios de salud y educaci6n, y coadyuvando a la reducci6n de los costos del transporte con lo que se fomenta el intercambio comercial y turistico. II. EVALUCION DE RESULTADOS

El presupuesto programado inicialmente fue del orden de US$ 90 millones y los costos finales de inversi6n sobrepasaron los US$ 136 millones, tal como se muestra en el ANEXO 1, lo que representa 52 % mas del monto estimado en la fase de preparaci6n, y que implic6 una mayor participaci6n de Aporte Local que sobrepas6 los US$ 71 millones, aumento equivalente a casi tres veces mas de lo previsto que fue de US$ 25 Millones.

Cabe sefialar que la mayor diferencia, se encuentra principalmente en los incrementos de costos de los Componentes de Obras Civiles, como se muestra en el ANEXO 2, debido principalmente a: 1. el tiempo transcurrido entre la etapa de finalizaci6n de los estudios en 1993, y la licitaci6n / contratacion de las obras en 1997. Este tiempo ha sido empleado en dos actividades principales, a. acordar entre el M.O.P.C. y el Banco, las bases y condiciones de los documentos de precalificaci6n y licitaci6n para contratar las obras y las supervisiones, ajustandolos a las Normas Locales y del Banco que no son muy claras y expeditivas, y b. Ia reubicaci6n de la poblaci6n afectada por las obras, y la adquisici6n de los derechos de posesi6n de las tierras para implantaci6n de las mismas, ocasionados por la falta de una Unidad de Bienes Inmobiliarios en la estructura organica del M.O.P.C., encargada de procesar todos los requerimientos en esa materia.

2. La realizaci6n de mejoras adicionales no contempladas en los Disenos Finales de Ingenieria, consecuencia de imprecisiones y/o defectos en los proyectos y por mayores volumenes de trabajo que los inicialmente previstos, porque en el tiempo transcurrido entre la etapa de disenio y de ejecuci6n de las obras, se ha producido una rapida urbanizaci6n en la zona. Ademas se tuvieron que realizar obras nuevas que debian ejecutar otras instituciones (CORPOSANA).

El aumento sustancial de los requerimientos de recursos locales, que no siempre estaban disponibles oportunamente, ha ocasionado regularmente una reduccion del ritmo de ejecuci6n de las obras, si no la paralizaci6n por algunos periodos de hasta seis meses..

En cuanto a las modificaciones principales de los contratos de obras fueron:

Obra 1: Rehabilitaci6n y Pavimentaci6n de la Ruta 1 Tramo: Paraguari - Yaguar6n - ltd.

1) Sustituci6n de los tramos de banquinas con empedrado base por una base drenante de concreto asfaltico. 2) Inclusi6n de cunetas revestidas, cord6n cuneta, construcci6n y reposici6n de empedrado, alcantarillas tubulares, barandas de hormig6n para puentes, Cord6n

- 39 - protector de borde, barras transversales en banquinas, pedraplenes, y drenes subterraneos. 3) Ensanche de calzada para darsenas, incluir disipadores en las cunetas con marcadas pendientes, cambiar barandas deterioradas o construirlas en puentes existentes, e incrementar la "Senalizaci6n Vertical". 4) Inclusi6n de la construcci6n de una variante en la zona urbana de Yaguar6n que permita la circulaci6n en sentido unico para la travesia de la Ciudad.

Obra I: Rehabilitaci6n y Pavimentaci6n de Acceso Sur a Asunci6n, Tramo: Ita - Guarambar6 - Nremby - 4 Mojones

1) Cambio de perfil rural a urbano, por la rapida urbanizaci6n de la zona. 2) Variaci6n de excavaciones de distintos tipos, terrapl6n, bacheo, pedraplen, drenes, empedrado, conducto de desague pluvial, por la presencia de suelos no aptos, desechos y material de arrastre, mayor deterioro de la calzada, y empalmes con calles transversales. 3) Modificaci6n de cantidades de excavaciones, terraplenes, cord6n cuneta, cuneta revestida, revestimiento de taludes con tepes, gaviones entre otros, por la urbanizaci6n de la zona, por la presencia de rocas mayores a las previstas, de suelos inadecuados, y napas freaticas muy altas. 4) La inclusi6n de varias obras nuevas para el mejoramiento del tramo: Ita - Itaugua como Via de conexi6n con el acceso Sur a Asuncion, para la readecuaci6n hidraulica de la Ruta N° 1, construcci6n de caseta de peaje en la Ruta N° 1, iluminaci6n de los cruces Ita, Guarambare, Ypane y sefializaci6n vertical en p6rtico.

Obra 111: Circunvalaci6n de la Ciudad de Asunci6n Tramo: 4 Mojones-Defensores del Chaco-Madame Lynch-Empalme Ruta N° 9

1) Ejecuci6n de un canal revestido de hormig6n complementado con un muro de contenci6n superior de mamposter[a de piedra bruta, en sustituci6n del canal de mamposter[a de piedra bruta y solera de hormig6n, previsto en el proyecto original. Se plante6 como consecuencia de las necesidades de incluir el revestimiento del canal, que de no efectuarse, las erosiones originarian su colapso, y la modificaci6n completa de las conducciones de los aportes pluviales laterales de pista por variaciones de las condiciones originales de escurrimiento, caudales y parametros de diseno. 2) Los proyectos de Viaductos, del diseno de la via, del drenaje superficial de pista, de excavaciones de bolsones de pista, de excavaci6n comun, eliminaci6n del item subrasante mejorada con cal, modificaci6n del paquete estructural para calzada existente, y de obras complementarias debido a la eliminaci6n de tuneles peatonales. 3) Como consecuencia de la interrupci6n de las obras de alcantarillado sanitario programadas por Corposana, por cancelaci6n del Prestamo del BIRF, el MOPC tuvo que incluir en el Proyecto la parte del alcantarillado que interfiere esta obra. 4) Modificaci6n de pista y aportes laterales, y la creaci6n de nuevos items: cambio de canal abierto por estructuras celulares en zonas puntuales, estructura de

-40 - disipaci6n, incorporaci6n de cruce vehicular y puentes peatonales sobre el canal, extensi6n del empalme con la Ruta a Villa Elisa, incorporaci6n de cruces semaf6ricos, rampas peatonales de hormig6n armado, calles laterales de viaductos, drenajes superficial y profundo de pista y calles adyacentes, pavimentaci6n de calles afectadas por los aportes de desagOes fluviales

Obra IV: Rehabilitaci6n y Pavimentaci6n de la Ruta 3 Tramo: Limpio - Emboscada - Acceso Norte a Asunci6n

1) Elevar la rasante en zona Ilana y plana sin cursos definidos de drenajes y con suelos de baja calidad, y ejecuci6n de pedraplen en tramos donde la rasante tiene poca altura y agua subterranea a poca profundidad, aumentar la longitud de pilotes, sustituci6n de viviendas, oficinas, y laboratorio, por casetas. 2) Mejorar el diseho de las banquinas y los drenajes ante el incremento sensible del volumen de transito 3) Por exigencias ambientales se incluye construcci6n de cunetas revestidas de hormig6n para evitar erosiones en los taludes de la obra. 4) Modificar las cantidades de excavaci6n tipo C (Roca), alcantarilla de Hormig6n Armado, Hormig6n estructural, varillas de acero, pedraplen, empedrados con cord6n de hormig6n, por la aparici6n de roca en la zona urbana de Emboscada, empalmes con calles nuevas, existencias de zonas inestables con basuras y agua.

Obra V: Recapado Ruta 6 'Dr. Juan L. Mallorquin", Tramo Norte (Empalme Ruta 7 - Km. 100)

Por el desfasafaje producido entre la epoca del diseno y la ejecuci6n de la Obra, por la determinaci6n exacta de los c6mputos metricos, y por las pruebas realizadas sobre metodos constructivos, se introdujeron modificaciones de las cantidades de excavaci6n en roca, alcantarillas de hormig6n armado para nuevos accesos, sustituci6n de barandas de hormig6n en puentes, imprimaci6n asfaltica, riego de liga, bacheo con concreto asfaltico incrementado por la aparici6n de nuevas fallas superficiales, y sustituci6n de Geotextil por concreto asfaltico.

Obra VI: PROGRAMA PILOTO DE ESTABILIZACION DE SUELOS DE CAMINOS VECINALES El programa ha sido desarrollo por la Direcci6n de Caminos Vecinales, y consisti6 en la construcci6n de pistas de pruebas de 500 metros por cada producto estabilizante, en diferentes tramos de caminos de tierra, con diferentes tipos de suelo, siendo ejecutados los Trabajos en cinco tramos de la Regi6n Oriental y dos tramos de la Regi6n Occidental, totalizando 27.8 Km, han sido utilizados productos de distintas procedencias; y los resultados han sido satisfactorios en cuanto se ha podido llegar a realizar una evaluaci6n del comportamiento de los productos estabilizantes con los diferentes tipos de suelo, sin embargo, es necesario continuar el sistema de monitoreo y evaluaci6n que incluya los

-41 - estudios de transito antes y despues de la ejecuci6n de los trabajos, la medici6n del grado de deterioro de cada tramo, impacto ambiental positivo y negativo y el analisis econ6mico.

En resumen, los beneficios del Proyecto resultaron altamente provechosos, inicialmente con la dinamizaci6n de la actividad econ6mica en las areas de influencia a traves de la generaci6n de empleo, y globalmente por los beneficios directos en los costos operativos de los vehiculos con una significativa rentabilidad, especialmente en las vfas de acceso a Asunci6n; Con respecto a los beneficios indirectos, bienestar de la poblaci6n, mejoramiento de la competitividad de los productos de exportaci6n y mayor estabilidad econ6mica interna del pafs, se ha observado un crecimiento sustancial que ha favorecido a la poblaci6n en general.

PROGRAMA DE FORTALECIMIENTO INSTITUCIONAL MOPC Los cambios de Gobierno ocurrido desde agosto de 1998, han motivado un atraso de la aprobaci6n definitiva del informe final del consultor, y la puesta en marcha del Plan de Acci6n propuesto. Sin embargo, se pueden puntualizar avances significativos logrados en el sector de la organizaci6n y gesti6n administrativa, y actividades tales como la creaci6n del comite de Planificaci6n como organismo Tecnico-Consultivo de planificacion estrategica, tactica y operativa del MOPC, y del Comite de Recursos Humanos para el desarrollo y la implementaci6n del Plan de Accion propuesto.

En el sector transporte y, con la promulgaci6n de la Ley NO 1590, se crea el nuevo marco legal del sector transporte. Dicha Ley regula el sistema nacional de transporte, creando la Direcci6n Nacional de Transporte (DINATRAN), ente autartico, encargado de dictar normas y administrar el transporte terrestre nacional e internacional de pasajeros, cargas y servicios especiales. La citada Ley, crea tambien la Secretaria del Transporte del Area Metropolitana de Asunci6n (SETAMA), encargada de dictar normas y administrar el transito y transporte terrestre en la citada Area. Considerando que la Ley NO 1590 tiene falencias en la competencia y coordinaci6n entre DINATRAN y la SETAMA, el MOPC esta estudiando las propuestas de modificaci6n de la citada norma Legal.

Referente al fortalecimiento de la Unidad Ambiental del MOPC, se han incorporado recursos humanos, se la dot6 de infraestructura fisica apropiada, y se han adquirido los equipos informaticos, y libros de texto para mejorar su capacidad de gesti6n.. En este ambito se realiz6 en la etapa final de implementaci6n del Proyecto, un estudio de evaluaci6n de los Programas y Medidas de Mitigaci6n Ambiental aplicados en la construcci6n de las obras del Octavo Proyecto de Carreteras, cuyas conclusiones principales muestran la escasa participaci6n de la Unidad Ambiental en el proceso de preparaci6n del Proyecto y de la ejecuci6n del mismo, recomendandose que en futuros proyectos se corrija esta deficiencia.

PLAN MAESTRO ACCESO DE ASUNCION

El estudio del Plan Maestro Accesos de Asunci6n, realizado por la Consultora LatinoConsult-Comycsa, ha sido entregado y puesto a consideraci6n de los municipios afectados por el estudio recomendando su implementaci6n. El trabajo incluy6 un plan de inversiones de obras y acciones institucionales tendientes a mejorar la circulaci6n del transito automotor en los accesos principales, mejorar el drenaje de areas criticas evitando la clausura en los dfas de Iluvias, disminuir el numero de accidentes de transito y poner en marcha

-42 - programas de educaci6n vial.

Ill. DESEMPEF4O DEL PRESTATARIO Es importante resaltar la decisi6n y el compromiso del Gobierno del Paraguay con el Banco Mundial para el diseno y ejecuci6n del Octavo Proyecto de Carreteras, asi como el cumplimiento de las obligaciones establecidas en el Convenio de Pr6stamo, especialmente en la implantaci6n del Marco Legal del sector Transporte, del Registro Nacional de Vehiculos, y el fortalecimiento Institucional, impulsando la optimizaci6n de la gesti6n administrativa, procurando mejoras financieras en el ambito de los derechos de los usuarios.

Se califica de satisfactorio el desempeno realizado por el Prestatario (Gobiemo, MOPC, Organismos Ejecutores), lograndose alcanzar al termino del Proyecto con los objetivos y la mayoria de las metas previstas, y utilizar casi en su totalidad los fondos disponibles. El interes y responsabilidad demostrados en los aspectos tecnicos y administrativos, y las coordinaciones permanentes con el Banco, permitieron la identificaci6n y soluci6n oportuna de los problemas, que en determinados casos obligaron a reajustes o modificaciones de metas que asegurasen el logro del Proyecto.

Es importante resaltar que la preparaci6n del Proyecto fue altamente compleja en la definici6n de las obras civiles, debido a la faita de experiencia local en este tipo de obras, para plantear las soluciones a los problemas que se presentaban. Se requiri6 de una intensa y estrecha actividad de coordinaci6n entre los Organismos involucrados del Estado y el Banco, considerando la premura del Gobierno de mejorar las vias de acceso a la Capital, y por el otro lado lo prolongado de los procedimientos que establecen las Normas del Banco, por lo que no fue posible asignar tiempos prudentes que permitieran lograr oportunamente todas las metas previstas, terminar todas las actividades prioritarias, y realizar las evaluaciones respectivas en las areas tecnicas, econ6micas, financieras, institucionales y medio ambiente. Asimismo, a fin de ayudar al M.O.P.C. buscando asegurar los resultados, se contrataron los servicios de consultorfas especializadas que apoyaron en la elaboraci6n de Terminos de Referencia y Bases, en el desarrollo y revisi6n de los Estudios para la ejecuci6n de las obras.

Con respecto a la etapa de ejecuci6n, el cumplimiento de los programas de actividades desarrollados para cada componente asi como el seguimiento de los indicadores claves de implementaci6n y de desempeno, facilit6 el logro de practicamente todas las metas establecidas y/o revisadas. Durante esta etapa, se revisaron las metas de los componentes y los montos asignados, y en concordancia con el Banco Mundial se reajustaron algunas metas, principalmente por mayores costos de inversi6n que los inicialmente previstos, resultado de los Concursos y Licitaciones llevados a cabo.

Es importante senalar que durante la ejecuci6n del Proyecto se produjeron cambios de Gobierno, hechos que no tuvieron incidencias negativas, puesto que todas las autoridades que se sucedieron demostraron una amplia identificacion con el proyecto, coadyuvando tanto al M.O.P.C. como los Organismos Ejecutores para realizar las funciones tecnicas y administrativas pertinentes, que tuvieron en consecuencia, un desempenio satisfactorio, mejorando la calidad de los resultados a medida que transcurri6 el Proyecto.

Con el Octavo Proyecto de Carreteras se implementaron por primera vez los nuevos documentos estandarizados, y procedimientos de cumplimiento obligatorio establecidos en las

-43- Normas del Banco, que en esos momentos no eran de conocimiento ni de aplicaci6n regular en los sistemas vigentes en el M.O.P.C., por lo que los Organismos Ejecutores demoraron un precioso tiempo a fin de adecuar, innovar y aplicar todas las actividades y procesos tecnico - administrativos, a las mencionadas normativas, lo que represent6 un riesgo para alcanzar a cabalidad los objetivos y las metas propuestas. Ademas, como dichos documentos no resultaron muy claros, durante la ejecuci6n del Proyecto ha generado frecuentes discusiones por las diferentes interpretaciones que se les dio.

IV. DESEMPENO DEL BANCO

La permanente participaci6n del Banco durante las etapas de preparaci6n, evaluaci6n y supervisi6n fue muy importante para el logro de los objetivos y metas, brindando continuo asesoramiento administrativo y operativo en todos los niveles, lo que facilit6 superar contratiempos y dificultades que se fueron presentando durante el desarrollo del Proyecto. Igualmente, a traves de las visitas de las misiones y comunicaciones realizadas desde Washington, los funcionarios del Banco demostraron inter6s, experiencia y conocimiento, coordinando y dialogando con los diferentes Organismos del Estado y en determinados casos interviniendo en reuniones de trabajo con los consultores, proponiendo acciones y/o altemativas con el prop6sito de solucionar los problemas suscitados.

El Banco desde los trabajos de preparaci6n demostr6 una amplia identificaci6n con los objetivos del Proyecto, que coincidian con ia Estrategia Integral del Gobierno en promover el desarrollo de pais, fomentando la producci6n agropecuaria, por medio de la reducci6n de los costos de transporte, construyendo y manteniendo una infraestructura vial en buenas condiciones, y a la vez se afirmaban bases s6lidas para promover el fortalecimiento, la organizaci6n y la capacidad del M.O.P.C..

En la etapa de evaluaci6n inicial, el Banco a traves de un grupo profesional multidisciplinario cumpli6 una labor de analisis y revisi6n del trabajo realizado en la primera etapa, identificando los posibles riesgos que implicaria la ejecuci6n del Octavo Proyecto de Carreteras, y aportando soluciones concretas, obteniendose como producto final el Informe de Evaluaci6n NO 11305-PA del 24 de noviembre de 1993, en el que se analiza detalladamente el sector transporte y la situaci6n econ6mica del pais, los objetivos y caracteristicas del Proyecto, los acuerdos alcanzados y las recomendaciones para la ejecuci6n 6ptima del mismo.

Ya durante la implementaci6n del Proyecto, en el proceso de contrataci6n de las obras civiles, se hizo notoria la falta de agilidad para acordar oportunamente con el M.O.P.C., ya sea de los terminos de las bases y condiciones de los documentos de precalificaci6n y licitaci6n, o de la evaluaci6n de las propuestas recibidas.

En la etapa de supervisi6n, el Banco asisti6 continuamente al M.O.P.C. a traves de visitas al pars por las misiones, equipos de trabajo y comunicaciones desde Washington, evaluando los avances y logros obtenidos, colaborando en la identificaci6n y soluci6n de problemas, formulando recomendaciones y aprobando requerimientos, mostrando celeridad y flexibilidad a propuestas planteadas por el M.O.P.C., con el afan de superar dificultades y optimizar la ejecuci6n del Proyecto. En casos especificos con prontitud aprobaron la modificaci6n parcial o total de metas y la consiguiente reestructuraci6n de los costos del Proyecto. Asimismo, las respuestas del Banco a solicitudes de No Objeci6n en terminos de tiempo razonables, principalmente para asuntos de tramite de presupuestos adicionales de obra y supervisi6n

- 44 - permitieron el normal desenvolvimiento de los trabajos.

V. LECCIONES CLAVES APRENDIDAS PARA FUTUROS PROYECTOS

En la fase de preparaci6n de los proyectos para la estructuraci6n de los cronogramas de actividades (estudios y obras), debe tenerse en cuenta tiempos razonables y flexibles que permitan cumplir adecuadamente con los trabajos requeridos en tiempos prudentes, a fin de no arriesgar la calidad de los trabajos. En el caso especifico de proyectos viales, los ubicados en zonas urbanas o suburbanas, considerando los cambios dinamicos que se producen en su entorno, es conveniente delimitar tramos cortos para contrataci6n de obras, en lo posible no mayores de 7 Km., con plazos estimados entre 12 y 18 meses, ya que facilita un mejor manejo de gesti6n y el cumplimiento de las obligaciones contractuales; ademas, debe evaluarse con mucho esmero las paralizaciones causadas por las Iluvias y sus consecuencias para los fuertes periodos de lluvia en el verano.

Durante la realizaci6n de los Estudios previos (desde la Factibilidad hasta el Diseno Final), ademas de establecer los tiempos prudenciales, es indispensable un buen control de calidad, si es necesario contratando profesionales especializados en supervisi6n de proyectos, dando especial atenci6n a los estudios topograficos, geol6gicos, hidrol6gicos, climatol6gicos y ambientales, con enfasis en la fase de investigaci6n de campo, pruebas de suelo y subsuelo; Asimismo, debe estudiarse minuciosamente la soluci6n de puntos criticos, banquinas apropiadas, el disenio de drenajes eficientes, la mitigaci6n de impactos ambientales negativos y la optimizaci6n de la seguridad vial en todos los tramos. Los Terminos de Referencia de Diseffos finales de Ingenieria deben incluir los trabajos necesarios para que el M.O.P.C. tenga liberada la franja de dominio donde se implementaran las obras viales, y estimar prudentemente el tiempo que insumiria estas actividades, a efectos de incluir en los cronogramas pertinentes. La aprobaci6n de los Estudios Finales de Ingenieria debe ser muy exigente, ya que se asegura la culminaci6n exitosa de las obras, caso contrario durante la ejecuci6n se presentaran defectos, deficiencias u omisiones, que podrian generar retrasos y presupuestos adicionales con porcentajes muy elevados en relacion con el presupuesto establecido en el contrato, poniendo en riesgo los objetivos del Proyecto.

Los Estudios Finales de Ingenieria de obras viales, requieren adicionalmente de una revisi6n especializada en el aspecto de seguridad vial, con el objetivo de reducir los problemas relacionados a los disenios, lo que permitira minimizar significativamente los posibles gastos futuros por modificaciones o correcciones posteriores. Es importante considerar en los terminos de referencia para los Estudios, los conceptos fundamentales de seguridad vial y durante la fase de construcci6n la aplicacion de auditorias.

Para futuros concursos o licitaciones, con el prop6sito de optimizar resultados y evitar poner en riesgo la culminaci6n oportuna de estudios u obras durante la selecci6n, el M.O.P.C. ha propulsado la nueva Ley de Obras Publicas, por la que se creo la DINOP (Direcci6n Nacional de Obras Publicas) y esta en pleno funcionamiento. Ademas ya esta promulgada la "Ley General de Concesiones de Obras y Servicios Publicos", con la que se trata de dar seguridad juridica a la participaci6n del sector privado en las Obras Publicas. Hacia estos objetivos tambien esta encaminando sus acciones la Secretaria Nacional de la Reforma del Estado. De todas maneras, la implementacion de todas estas disposiciones legales vigentes van a requerir del apoyo de instituciones y de expertos, donde la participaci6n del Banco sera muy importante

- 45 - Se requiere en el mediano plazo implementar un "Plan Nacional de Inversiones Viales" que optimice integralmente los ambitos operacional, mantenimiento y rehabilitaci6n, coadyuvando con la reducci6n de los costos del transporte y consecuentemente con la disminuci6n de precios de los productos de consumo interno como de exportaci6n. En tal sentido es indispensable en el corto plazo, elaborar y administrar un "Banco Central de Informaci6n", que reuna datos de todos los proyectos ejecutados y en proceso, con la problematica y soluciones aplicadas, analisis de estructuras de costos estimados y/o propuestos, ofertas presentadas por los contratistas y validaciones durante la ejecuci6n de las obras. Igualmente, es necesario contar con una "Cartera de Proyectos" que posibilite con eficiencia acceder a informaci6n tecnica y financiera de los Proyectos que se encuentren listos para llevarse a cabo, ordenados en forma prioritaria y que a la vez permita la identificaci6n de los diversos requerimientos para su ejecuci6n con los respectivos planes de aprovisionamiento.

Se debe propiciar y dinamizar la elaboraci6n y actualizaci6n permanente de publicaciones tecnicas, que procuren establecer normas y manuales, faciliten el manejo y mejoren los resultados de estudios y de obras, considerandose entre los de mayor prioridad los manuales: "Estandarizaci6n de Costos para el Disefno de Carreteras", "Diseno Geometrico de Carreteras", "Especificaciones Tecnicas Generales para la Construcci6n de Carreteras", "Computo metrico y Presupuestos en Materia Vial", "Supervisi6n de Obras", "Supervisi6n de Estudios", . "Normas Nacionales de Seffalizaci6n Vial" y "Normas de Protecci6n al Medio Ambiente". En el campo de las evaluaciones economicas ex-ante como ex-post de obras viales, para que puedan ser comparables y obtener resultados reales de los beneficios obtenidos, es necesario que los conteos de trafico se realicen en similares estaciones (puntos geograficos) y que los estudios de trafico utilicen factores de correcci6n estacional adecuados y actualizados, que eviten distorsi6n en los valores de los indicadores de rentabilidad y efectos negativos en la generaci6n de beneficios.

En el aspecto de entrenamiento, con el prop6sito de optimizar futuras gestiones, es conveniente invertir y profundizar especialmente en puntos crfticos, como: a. Programas de capacitaci6n orientado a los profesionales y tecnicos del M.O.P.C., para el conocimiento y aplicaci6n de nuevas tecnologfas de la construcci6n y mantenimiento; asf como de procedimientos de caracter administrativo, dando especial atencion a la organizacion de expedientes, adicionales, pr6rrogas y otros. b. Propiciar la capacitaci6n y actualizaci6n peri6dica de los profesionales y t6cnicos de las empresas privadas que prestan o estan interesadas en brindar servicios como proyectistas, constructores, supervisores y otras modalidades.

Para futuros Proyectos de la magnitud y complejidad del Octavo Proyecto de Carreteras, resulta imprescindible contar con una Unidad de Coordinaci6n conformada por un equipo de profesionales especializados y multidisciplinario, que sea responsable de la gestion de preparaci6n, seguimiento, monitoreo, coordinaci6n, control, informes y archivo de las diversas actividades y avances de cada componente del Proyecto. Debe garantizarse en el Contrato de Prestamo que la continuidad de los Profesionales de dicha Unidad, solo dependa del desempeno relacionado al Proyecto. Esta Unidad debera constituirse en vfnculo permanente y eficaz entre el Banco, el M.O.P.C., y los Organismos Ejecutores.

-46 - ANEXO 1 COSTOS FINALES DEL PROYECTO Cat. TOTAL % COMPONENTES de Banco desemb Costo total Costo BIRF Costo Local NO US$ | US$ | US$ Obras Civiles 1 Obra 1- Acc. Sur, Paraguari - Ita 5,929,100.56 4,051,678.95 1,877,421.61 68 Obra 2-Acc. Sur, Ita - 4 Mojones 34,595,326.88 18,041,180.18 16,554,146.70 52 Obra 3-Circunvalacidn 56,506,556.72 24,953,442.00 31,553,114.72 44 Obra 4-Acc. Norte, Limpio - Emboscada 4,978,357.20 2,188,544.55 2,789,812.65 44 Obra 5, Recapado 100 Km. Ruta 6 9,242,670.99 3,944,827.68 5,297,843.31 43 Adquisid6n de tierras 13,000,000.00 13,000,000.00 0 Obra 6-Estabilizaci6n de Caminos Vecinales 300,000.00 97,219.63 202,780.37 32 124,552,012.35 53,276,892.99 71,275,119.3614

Eguipos 2 Para el DEyC de la DV 24,994.00 21,244.90 3,749.10 85 Libros de Textos Ambientales 1,887.75 1,887.75 100 Para la UA 15,813.00 15,813.00 0 42,694.75 23,132.65 19,562.10| 54

Consultorfa y Capacit. 3 Supervisi6n Obra 1Y 2 2,029,092.33 1,839,327.79 46,051.93 91 Supervisi6n Obra 3 2,849,515.28 2,537,145.08 312,370.20 89 Supervisi6n Obra 4 1,335,693.44 1,335,693.44 100 Supervisi6n Obra 5 632,283.56 632,283.56 100 Disenio Ruta 6 301,751.38 301,751.36 100 Sup.Plan Piloto Est.Suelos 283,779.49 239,676.96 15,659.49 84 Fortalec.institucional Fase 1 1,254,573.76 1,254,573.76 100 Fortalec.lnsttitucional Fase 2 983,245.97 917,847.97 65,398.00 93 Fortalecimiento Unidad Ambiental 50,000.00 50,000.00 100 Est. Plan Maestro de Accesos a Asunci6n 248,103.00 248,103.00 100 Capacitaci6n 39,010.15 39,010.15 100 Auditora 11,164.53 11,164.53 100 Coordinaci6n 36,421.13 36,011.82 99 10,054,634.02 9,442,589.42 439,479.621 94

PPF 4 223,037.92 223,037.92 Otros pagos segun liquidaci6n BIRF-PPF 1,338,677.05 1,338,677.05 Otros pagos segun liquidaci6n BIRF-PPF 136,285.03 136,285.03 1,698,000.00 1,698,000.00 No desembolsado 1,698.00 5,274.94 Dep6sito Cta. Especial no utilizado 554,110.00 TOTALES 1 136,347,341.121 650,000,000.00 71,734,161.080 48

-47- ANEX0 2

VARIACION DE LOS COSTOS DE OBRAS CIVILES

Valor inicial Valor inicial varacion Valor Actual con variacion Obras Civiles Estimado Contratado ContJ./ Est modificadones Act. / Contr. US$ US$ US$ %

Obra 1-Acc. Sur, Paraguari- Ita 3,300,000 4,608,163 40 5,929,101 29 Obra 2-Acc. Sur, Ita - 4 Mojones 18,400,000 24,958,563 36 34,595,327 39 Obra 3-Circunvalaci6n 26,900,000 47,000,134 75 56,506,557 20 Obra 4-Acc. Norte, Limpio - Emboscada 6,200,000 4,521,808 -27 4,978,357 10 Obra 5, Recapado 100 Km. Ruta 6 4,600,000 6,761,985 47 9,242,671 37 Obra 6-Estabilizacd6n de Caminos Vecinales 1,000,000 300,000 -70 300,000 0 TOTAL - 60,400,0001 88,150,654 46 111,552,0121 27

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