PROJECT INFORMATION DOCUMENT (PID) APPRAISAL STAGE Report No.: AB4792 TRANSPORT SECTOR SUPPORT PROJECT Project Name Public Disclosure Authorized Region Sector Roads and highways (62%); Aviation (24%); Agricultural markets and trade (10%); General transportation sector (4%) Themes: Rural services and infrastructure (72%); Infrastructure services for private sector development (26%); Other public sector governance (2%) Project ID P055120 Borrower(s) GOVERNMENT OF United Republic of Tanzania, Ministry of Finance and Economic Affairs P.O. Box 9111 Tanzania Public Disclosure Authorized Tel: +255 22 2112854 Fax: +255 22 2117090 / 2110326 Implementing Agencies Tanzania National Roads Agency (TANROADS) Tanzania Airports Authority (TAA) Ministry of Infrastructure Development (MoID) Environment Category [] A [X] B [ ] C [ ] FI [] TBD (to be determined) Date PID Prepared March 18, 2010 Date of Appraisal March 1, 2010 Authorization Date of Board Approval May 27, 2010

I. Country and sector issues

Public Disclosure Authorized 1. Tanzania’s Economy. From 2002 to 2008 Tanzania has experienced sustained growth of around seven percent thanks to the implementation, since the mid nineties, of a comprehensive economic reform program that has produced good macroeconomic performance and stability characterized by relatively high economic growth and low inflation. The global financial crisis has resulted in a decline in growth from 7.4 percent in 2008 to five percent in 2009. One of the country’s main challenges remains to translate economic growth into poverty reduction, with the country registering only a small decline in poverty incidence from 35.7 percent in 2000 to 33.5 percent in 2007. Key growth sectors are mining, construction, manufacturing, and tourism—all sectors that strongly depend on and generate transport. Poor transport infrastructure is a major bottleneck and increased and sustained investment is needed. Past finance has been insufficient to cope with growth and to ensure an appropriate infrastructure platform to achieve the Millennium Development Goals or the National Development Vision 2025.

Public Disclosure Authorized 2. Transport System. The current transport system consists of roads, railways, aviation, water transport, and pipelines. The road network length on the mainland of Tanzania is 86,472 kilometers (Zanzibar has about 1,600 kilometers of roads). This includes trunk and regional roads (29,847 kilometers), which are managed by the Tanzania National Roads Agency 1 (TANROADS) and the urban, district, and feeder roads with a total length of 56,625 kilometers managed by the 132 Local Government Authorities (LGA). The Tanzania railways system has a total length of 3,681 kilometers of which 2,706 kilometers are operated by Tanzania Railways Limited (TRL), and 975 kilometers by the Tanzania-Zambia Railway Authority (TAZARA). The Tanzania Port Authority (TPA) is responsible for all ocean and lake ports. The most important ports are Dar es Salaam (DSM), Tanga and Mtwara on the Indian Ocean mainland shore, and Mwanza, Kigoma and Itungi on the inland lakes. There are a total of 368 aerodromes, 62 of which are owned, managed and operated by the Tanzania Airports Authority (TAA), and the others by a variety of entities including national park authorities and the private sector. There are four international airports namely the Julius Nyerere, Kilimanjaro, Mwanza and Zanzibar airports. The Zanzibar International Airport is managed by the Government of Zanzibar (GoZ) as is the case for the Zanzibar and Pemba ports and roads. The Tanzania – Zambia (TANZAM) pipeline provides oil for the refinery in , Zambia, via the DSM port.

II. Project development objectives and key indicators

3. The development objectives of the project are: to improve the condition of the national paved road network, to lower transport cost on selected roads, and to expand the capacity of selected regional airports.

4. The project outcome indicators are the following: (i) average vehicle operating costs on Korogwe – Same and – Minjingu roads; (ii) roads in good and fair condition as a share of total classified roads (Core Indicator); and (iii) passenger volumes at Bukoba, Kigoma and Tabora airports. There are an estimated 5.15 million direct beneficiaries (users of the transport facilities) and a further 11.1 million indirect beneficiaries who will gain from the reduced transport costs in the affected regions.

III. Project components

5. Component A: Rehabilitation and preparation of designs for the rehabilitation of paved trunk roads (US$186.5 million, 100 percent IDA financed): this component will be implemented by TANROADS and will finance, out of the rehabilitation backlog of about 1200 kilometers of paved trunk roads: (i) rehabilitation of the Korogwe – Same road (172 kilometers); (ii) rehabilitation of the Arusha – Minjingu road (98 kilometers); and (iii) the preparation of design and bidding documents for future rehabilitation of 911 kilometers of paved trunk roads. The Korogwe-Same road forms part of the North East Corridor (T2), which is a major link between the east coast and the popular tourist destinations in the north of Tanzania. It is also the main road link between DSM and , the major trading centers of Tanzania and respectively. The Arusha – Minjingu road is part of the great African North – South axis from to , and also it connects Arusha with the important northern Tanzanian national parks including Serengeti.

6. Component B: Improvement of regional airports (US$69.2 million of which IDA US$57.5 million and GoT US$11.7 million): this component will be implemented by the Tanzania Airports Authority (TAA). Under this component the paving and rehabilitation of the runway at Kigoma airport, the rehabilitation of the main runway at Tabora airport, as well as the

2 extension, rehabilitation, and resurfacing of the runway at Bukoba airport, with the replacement of the current apron, terminal, car parking, and other facilities, will be financed. Out of the thirteen high priority commercial airports identified under the TSIP for immediate improvement, design and bidding documents have been prepared for seven airports. Among them, these three airports have been selected due to their high economic returns and the low likelihood to get other financing.

7. Component C: Improvement of road safety (US$6.0 million, 100% IDA financed): this component will be implemented by MoID. It will support the establishment of the National Road Safety Agency (NRSA), the Driver and Vehicle Examination and Licensing Agency (DVELA), and the development of a Road Accident Information System (RAIS), as proposed in the recently adopted National Road Safety Policy (NRSP).

8. Component D: Promotion of Public-Private Partnerships: (US$5.0 million, 100% IDA financed): the implementation of this component will be overseen by MoID, while actual contracts for feasibility studies and transaction advisors would be procured by the concerned entities (TANROADS, TAA, TPA, PMO-RALG, RAHCO). This component would include: (i) capacity building for the implementation of PPP projects; (ii) feasibility studies of potential PPP projects; and (iii) transaction advisors for projects that were found feasible.

9. Component E: Emergency Road and Bridge Repair: (US$15 million, 100% IDA financed): this component will be implemented by TANROADS. Emergency repair of parts of national roads and bridges damaged by recent floods at approximately one hundred locations throughout Tanzania will be executed under this component. Rapid Response to Crises and Emergencies Guidelines of the World Bank (OP 8.00) apply. This includes retroactive financing (of 40 percent of the component amount) and accelerated, consolidated, and simplified procedures under streamlined ex-ante procurement and safeguards requirement, as outlined in Annex 8, paragraph 4, and Annex 10, paragraph 24 of this document.

IV. Financing

Source: ($m.)

International Development Association (IDA) 270.0 Tanzania Airports Authority (TAA) 10.3

Total 280.3

CONTACT POINT

Contact: Dieter E. Schelling Title: Lead Transport Specialist Tel: : (255-22) 2163273 Fax: (255-22) 2113039 Email: [email protected] Location: Dar es Salaam, Tanzania (IBRD)

3 FOR MORE INFORMATION CONTACT: The InfoShop The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 458-4500 Fax: (202) 522-1500 Email: [email protected] Web: http://www.worldbank.org/infoshop

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