World Bank Document
Total Page:16
File Type:pdf, Size:1020Kb
Document of The World Bank FOR OFFICIAL USE ONLY FILECOPY Public Disclosure Authorized Report No. 478lb-PE Public Disclosure Authorized STAFF APPRAISAL REPORT PERU LIMA METROPOLITAN DEVELOPMENTPROJBC T Public Disclosure Authorized May 29, 1984 Public Disclosure Authorized FILECOPY( Projects Department 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 official duties. Its contents may not otherwise be disclosed without World Bank authorization. Currency Equivalent Currency Unit = Sol (SI.) March 1983 May 15, 1984 US$1 = S/1,172 US$1 = S/3,025 S/.1 = US$0.00085 S/.1 = US$0.0003 S/.1,000 = US$0.85 S/.1,000 = US$0.33 System of Weights and Measures Metric 1 kilometer (km) = 0.62 mile (m) 1 metric ton = 2,205 pounds Fiscal Year January 1 - December 31 LIST OF ACRONYMS AND ABBREVIATIONS CAF CorporacionAndina de Fomento Andean DevelopmentCorporation CM Comision Multisectorial MultisectorialCommission CMC Comision MultisectorialCoordinadora Multisectorial Coordinating Commission CMP CoordinadorMunicipal del Proyecto Municipal SubprojectsCoordinator DGR Direccion General de Rentas Revenue Office ESMLL Empresa de Servicios Municipales de Limpieza de Lima Municipal Solid Waste Corporation EMMSA Empresa de Mercados MayoristasS.A. WholesaleMarketing Corporation ENATRU Empresa Nacional de Transportes Urbanos National Urban Transport Corporation FAO Food and Agriculture Organization of the United Nations GTZ German Technical Assistance Agency INVERMET Fondo Metropolitano de Inversiones en Fideicomiso Metropolitan Investment Fund MEFC Ministerio de Economia, Finanzas y Comercio Ministry of Economy, Finance and Commerce MH Ministerio de Vivienda Ministry of Housing MLM Municipalidad de Lima Metropolitana Municipalityof MetropolitanLima MTC Ministerio de Transporte y Comunicaciones Ministry of Transport and Communications FOR OFFICIAL USE ONLY OMC Oficina Metropolitana de Catastro Metropolitan Cadaster Office OMTU Oficina Metropolitana de Transportes Urbanos Metropolitan Urban Transport Office OPDM Oficina del Plan de Desarrollo Metropolitano Metropolitan Development Planning Office PPF Project Preparation Facility UP Unidad de Presupuesto Budget Unit of MLM This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disciosed without World Bank authorization. STAFF APPRAISAL REPORT PERU LIMA METROPOLITANDEVELOPMENT PROJECT TABLE OF CONTENTS Page No. I. LOAN AND PROJECT SUMMARY ........................ 1 II. METROPOLITAN LIMA AND THE URBAN SECTOR ...................... 3 A. Urbanization and the Primacy of Lima ....... 3 B. National Urban Policy ....... 4 C. Lima Metropolitan Government ....... 5 D. Institutional Development .. ......... 5 E. The Issues of Metropolitan Management ....... 6 (i) Municipal Finances . 6 (ii) Planning ....................................... 6 (iii) Staffing ........................................ 6 F. Other Sectoral Issues in the Lima Metropolitan Area ....... 7 (i) Urban Transport ................................... 7 (ii) Wholesale Markets .... ................... ...... 9 (iii) Solid Waste Management ... ............ ........... 10 G. Bank Involvement in the Urban Sector ....... 10 III. THE PROJECT ............... 11 A. Project Rationale and Objectives ...................... 11 B. Main Features of the Project........ 12 (i) Urban Transport Subproject ....................... 12 (ii) Wholesale Market Subproject ...................... 14 (iii) Solid Waste Management Subproject ................ 15 (iv) Urban Management Subproject ... ,................. 16 IV. COST ESTIMATES AND FINANCING PLAN ............ **.o....... 18 A. Cost Estimates ... ,.18 B. Financing Plan . ... 1 C. Flow of Funds ....... 20 D. Procurement ....... 21 E. Disbursements ... 22 Fo Accounts and Audits . ... e..... oe.. o.... o..o.........o23 This report is based on the findings of an appraisal mission and a post-appraisalmission that visited Peru during April and May 1983 and February 1984 respectively. The appraisal mission comprised Messrs. C.-H. Mumme (MissionLeader), S. Alber, LCPUR; G. Menckhoff,ASP; D. Arbour, S. Cointreau, G. Kroll, R. Paraud, and M. Thomson, Consultants. The post-appraisalmission consistedof Messrs./Mmes.C-H. Mumme (Mission Leader); J. Flora, S. Whitehead; G. Yabrudy, LCPUR, and S. Cointreau (Consultant). Miss Martha Behar assisted in the production of the report, which has been edited by Miss Virginia Foster, IDF2. Table of Contents (Continued) Page No. V. PROJECT IMPLEMENTATION ....................... 24 A. InstitutionalArrangements ............ ....... 24 B. Status of Project Preparation ......................... 26 C. Implementation Schedule ..... .........................26 D. Monitoring and Evaluation ............................. 27 VI. FINANCIAL ANALYSIS ........................... e..... 27 A. Metropolitan Finances: An Overview ................... 27 B. Action Program . .............27 C. Fondo Metropolitano de Inversiones (INVERMET)..ET. 29 D. Empresa de Mercados Mayoristas S.A. (EMMSA)............ 29 (i) Financial Performance on Existing Operations ... 29 (ii) Proposed Market ................................ 30 (iii) Financial Management .............. ............. 30 VII. ECONOMIC AND SOCIAL ANALYSIS c... 31 A. Economic Justification ................................ 31 B. Distribution of Project Benefits . ................ 32 C. Environmental Impact . ................................. 33 D. Project Risks ............................ .......... 33 VIII. AGREEMENTS REACHEDAND RECOMMENDATION ..................... 34 TEXT TABLES 4.1 Project Cost Summary ................................ 18 4.2 Financing Plan ....... ........ a..... 20 ANNEXES 1. Organization Chart of the Municipality of Lima ............ 38 2. Detailed Cost Table ....* .... .. ..... ................... 39 3. Procurement Arrangements ..... ..................... .. 40 4. Disbursement Schedule ............................... .... *41 5. Details of the Management System .......... ................ 42 6. Implementation Schedule/Physical Indicators ............... 45 7. Key Institutional Actions ................................. 46 8. Key Evaluation Indicators ... .... ......... ..............51 -iii- Table of Contents (Continued) Page No. Annexes (continued) 9. ConsolidatedStatement of Income and Expendituresfor Lima Metropolitan Area ....................... ... ... 54 10. ComparativeHistorical Financial Statements- INVERMET., 55 11. ProjectedRevenue and Funds Flow - INVERMET. 57 12. Comparative Financial Statements - EMIMSA ......... 59 13. Projected Financial Statements - EMMSA .......... 62 14. Key AssumptionsUsed in Economic Analysis ..................65 15. Results of Economic Evaluation ............................ 67 16. Sensitivity Tests ...................... 68 17. Distribution of Project Benefits .... .... .. .. 69 18. Selected Documents and Data Available in Project File . 70 MAP IBRD - 17613 Lima MetropolitanDevelopment Project PERU LIMA METROPOLITANDEVELOPMENT PROJECT I. LOAN AND PROJECT SUMMARY Borrower: Republic of Peru Beneficiaries: Municipalityof MetropolitanLima (MLM) and Wholesale Marketing Corporation (EMMSA). Amount: US$82.5 million equivalent, including a capitalized front-end fee. Terms: Repayable in 17 years, including four years of grace, at the standard variable interest rate. Relending Terms: For the market subproject, the Borrower would on-lend US$22.4 million equivalent for 17 years, including six years of grace, with the same interest rate as the Bank Loan. EMMSA would bear the dollar-sol exchange risk. Project The proposed project would support (a) the progressive Description: transfer of urban administrationfrom national to local governmentand, specifically,more efficientmetropolitan management in Lima, the capital of Peru, as well as (b) improvementsin high priority infrastructureand services in the areas of urban transport, solid waste and wholesale marketing. About 53% of benefits from the infrastructureand services improvementswould accrue to low-income residents. Principal subprojectswould be: (a) traffic management improvementsthroughout the city, paving of about 100 km of streets in low-income areas and road rehabilitationand maintenance;(b) constructionof a new wholesale market; (c) provision of vehicles, equipment and transfer station capacity and development of two landfill sites to meet the needs of the city's solid waste agency and the city districts; and (d) institutionalstrengthening through studies, technical assistance and training of the agencies charged with each of the above activities as well as improvementsin city planning,municipal finance and coordinationof urban investmentsand project administration. Special Risks: Risk of local funding difficultiesduring a period of national austerity would be addressed by relying mainly on local funding from an earmarkedsource (gasoline tax revenues). Risk of inadequate professionalstaff within the Municipalitywould be mitigated by requiring contractingof implementationadvisors initially for the largest subproject,transport, and by providing training for municipal staff. Any problems of coordination between national and municipal agencies would be eased by the MultisectoralCoordinating Commission. -2- Estimated Costs* Local Foreign Total ------------US$ million---------- (a) Urban Transport 26.6 33.6 60.2 (b) Wholesale Market 15.4 9.3 24.7 (c) Solid Waste