AFRICAN DEVELOPMENT FUND
PROJECT COMPLETION REPORT
Oxbow – Mokhotlong Road Project
LESOTHO
June 2000
Infrastructure and Industry Division Country Department, South i CURRENCY EQUIVALENTS
1UA = 2.65678 Maloti, 4th Quarter 1987 (Appraisal) 1UA = 3.96721 Maloti, 3rd Quarter 1992 (Reappraisal) 1UA = 3.94371 Maloti, 2nd Quarter 1992 (Commencement of Works) 1UA = 5.45137 Maloti, 4th Quarter 1995 (Completion of Works – Lot 2) 1UA = 6.26120 Maloti, 3rd Quarter 1997 (Completion of Works – Lot 1)
WEIGHTS AND MEASURES
1 metric ton (t) = 2,205 lbs 1 kilogram (kg) = 2.205 lbs 1 metre (m) = 3.281 ft 1 kilometre (km) = 0.621 mile 1 square km (km2) = 0.386 square mile 1 hectare (ha) = 0.01 km2
FINANCIAL YEAR : 1st April – 31st March
ABBREVIATIONS
AB = Architect Branch ADB = African Development Bank ADF = African Development Fund ADT = Average Daily Traffic BADEA = Arab Bank for Economic Development in Africa CRE = Chief Roads Engineer CWS = Civil Works Section DCF = Discounted Cash Flow EIRR = Economic Internal Rate of Return GDP = Gross Domestic Product GOL = Government of Lesotho ICB = International Competitive Bidding IDA = International Development Association LCU = Labour Construction Unit LNTS = Lesotho National Transport Study MHA = Ministry of Home Affairs MOF = Ministry of Finance MOPWT = Ministry of Public Works and Transport OPEC = Organisation of Petroleum Exporting Countries PIA = Project Influence Area PMMS = Pavement Maintenance and Management System RB = Roads Branch RF = Road Fund RRMP = Road Rehabilitation and Maintenance Project VOC = Vehicle Operating Cost VPD = Vehicles per Day ii
TABLE OF CONTENTS
Page Executive Summary iv - v Project Basic Data vi - viii Project Log-frame ix
1. INTRODUCTION 1
2. PROJECT OBJECTIVE AND FORMULATION 2
2.1 Project Objectives 2 2.2 Project Description 2 2.3 Project Formulation 2
3. PROJECT EXECUTION 3
3.1 Effectiveness and Start-up 3 3.2 Modifications 3 3.3 Implementation Schedule 3 3.4 Procurement 5 3.5 Reporting 5 3.6 Project Costs and Financing Sources 5 3.7 Disbursements 6 3.8 Performance of the Contractor and Consultant 7
4. PROJECT PERFORMANCE 8
4.1 Overall Assessment 8 4.2 Operating Performance Results 8 4.3 Management and Organisation Effectiveness 10 4.4 Staff Recruitment, Training and Development 10 4.5 Economic Performance 11
5. SOCIAL AND ENVIRONMENTAL RESULTS 12
5.1 Social Impact 12 5.2 Environmental Impact 13
6. SUSTAINBILITY 13
7. PERFORMANCE OF THE BANK AND THE BORROWER 14
7.1 Performance of the Bank 14 7.2 Performance of the Borrower 14 7.3 Performance of Co-financiers 15 iii 8. OVERALL PERFORMANCE RATING 15
9. CONCLUSIONS AND LESSONS AND RECOMMENDATIONS 15
9.1 Conclusions 15 9.2 Lessons learnt 15 9.3 Recommendations 17
LIST OF ANNEXES
Annex No. Title No. of Pages
1. Projects Financed by the Bank Group in Transport Sector 1 2. Project Location Map 1 3. List of Documents Consulted 1 4. Loan Conditions 1 5. Implementation Schedule – Appraisal versus Actual 1 6. Details of Disbursements 1 7. Performance Rating 2 8. Road Condition Matrix 1 9. Organisation Chart of Roads Branch, MOPWT 1 10. Vehicle Operating Costs and Updated Traffic Forecast 1 11. Re-calculation of Economic Internal Rate of Return 2
______
This report was prepared by Messrs. K.S.H.Rao, Transport Economist (OCDS.4, ext.4379), S.B.Turay, Transport Engineer (OCDS.4, ext.5979) and W. Soliman, Environmentalist (OCDS.2, ext. 4214) following their mission to Lesotho from 17th to 28th January 2000.
The Division Manager in charge is: Mr. G.Giorgis, Manager, OCDS.4 (ext.4121).
LESOTHO Project Completion Report – Oxbow-Mokhotlong Road project Executive Summary iv 1. The objective of the Oxbow-Mokhotlong Road Project was to upgrade the existing gravel road to bitumen standard with a view to providing a safe, faster and all-weather road between Oxbow and Mokhotlong. The project consisted of: a) civil works for upgrading the existing gravel road to bitumen standard of 6-meter carriageway width and 1-meter shoulder on either side from Oxbow to Mokhotlong (109 km) consisting of two sections i) Oxbow- Tlokoeng (72 km) – Lot 1 and ii) Tlokoeng-Mokhotlong (32 km) - Lot 2; b) consultancy services for the supervision of construction works; and c) technical assistance to the Roads Branch consisting of two engineers for a duration of 5 years. While Kuwait Fund, BADEA, OPEC and GOL financed the construction of Lot 1 above, ADF and GOL jointly financed construction of Lot 2 and items b) and c) above.
2. The substantial completion for the project was achieved in August 1997, about 62 months behind the appraisal schedule. Major delay (about 30 months) occurred during the pre-contract services which was mainly attributable to: i) design review leading to substantial modifications in the original design, and ii) sourcing of supplementary funding from donors.
3. The total cost of the entire project (net of taxes), at appraisal, was estimated at UA 38.58 million and the actual cost was UA 59.11 million indicating a cost increase of about 50%. At appraisal, the total cost of the ADF financed component of the project (net of taxes) was estimated at UA 17.57 million, of which ADF was to contribute UA 17.17 million (97.7%) and the balance UA 0.40 million (2.3%) from the GOL. As a result of the design review, the original project designs, especially the pavement and bridge structures, were significantly modified. To assist the GOL to meet the cost increases due to design modifications, the ADF approved a supplementary loan of UA 2.86 million in December 1992. The actual cost of the ADF component of the project at completion was UA 23.98 million, which exceeded the appraisal estimate by about 37%. Of the actual cost, ADF contribution was 83.5% and that of GOL was 16.5%.
4. The procurement of supervision consultant, TA consultant and contractor was as per the Bank’s rules and procedures. Submission of monthly and quarterly progress reports was regular.
5. Taking into account factors such as time and cost, compliance with contract conditions, adequacy of supervision and reporting, the overall project implementation performance with a score of 1.5 has been assessed as not satisfactory on a rating scale ranging from highly satisfactory (4) to highly unsatisfactory (1).
6. The Oxbow-Mokhotlong road section, as a whole, appears to be in a fair condition. It has started prematurely exhibiting some surface defects. To remedy the situation, periodic maintenance is proposed during 2001 as part of Road Rehabilitation and Maintenance Project (RRMP). The actual traffic materialisation was about 67% of the appraisal expectations. Main reasons underlying such a low traffic materialisation are: a) observed traffic growth of about 6.85% per year was much below the projected rates of 10% and 12% and b) the developments anticipated in the project influence area have not fully materialised.
7. Taking into account the actual project costs and revised project benefits in line with the updated traffic forecasts, the economic internal rate of return (EIRR) for the project has been worked out as 5.5%, which is much lower than the appraisal EIRR of 13.8%. This situation is mainly attributable to a) increase in project cost and b) low levels of actual traffic. In other words, the investment is not justified based on the quantifiable economic benefits. v Notwithstanding, the developmental nature and social desirability of the project need not be overemphasised.
8. Lessons learnt from the project execution are as under:
(a) The original pavement design was not suitable for the project road traversing the mountainous region where wet conditions are prevalent due to heavy rainfall and snowfall. However, the Executing Agency (EA) approved the designs without a proper review. The Bank also did not undertake the necessary review of the design prior to appraisal. This resulted in significant design modifications and associated cost increase and implementation delays. The key lesson is that for future projects care should be taken by the EA in closely monitoring and reviewing pavement designs prepared by the consultants so as to ensure that the finally approved designs take into account the physical features and specific requirements of the project area.
(b) A major problem encountered along the project road is unstable cut slopes, particularly along the high mountainous section (about 3000 m). This has resulted in constant slips and rock falls. Although a permanent maintenance crew is in place to clear the rock falls; it is recommended that a study be undertaken by the Government of Lesotho to find a way of stabilising the slopes. This experience would be useful for future projects in similar mountainous areas.
(c) The actual project cost exceeded the appraisal estimate by about 50%. The level of actual traffic on the project road is about 67% of the appraisal estimate. The increase in project cost coupled with low level of traffic materialisation brought down the appraisal EIRR from 13.8% to 5.5%. To obviate such a situation, the appraisal mission should undertake a review of the i) design and ii) existing and anticipated traffic levels. Further, traffic projections should be prepared under three scenarios viz. pessimistic, moderate and optimistic. The project appraisal should, however, be based on moderate traffic scenario. d) Absence of effective emphasis on environmental issues has led to problems that could impede development potential in the project area. To avoid such implications, for future projects environmental and other cross-cutting issues should be closely supervised by environmental and social experts on a regular basis during project implementation.
BASIC PROJECT DATA
1. Country : Lesotho 2. Project : Oxbow-Mokhotlong Road Project 3. Loan number : F/LES/TRA-ROD/87/20 & F/LES/ROD/93/SUP/8 4. Borrower : Government of Lesotho 5. Beneficiary : Government of Lesotho 6. Executing Agency : Ministry of Public Works & Transport, Roads vi Branch
A. Loan Details (ADF)
Description Appraisal Reappraisal Actual (Original Loan) (Suppl. Loan) 1.ADF Loan Amount (UA) 17.17 million 2.86 million 20.03 million 2. Interest Rate Nil Nil Nil 3.Service Charge 0.75% 0.75% 0.75% 4.Repayment Period 40 years 40 years 40 years 5.Grace Period 10 years 10 years 10 years 6.Loan Negotiation Date November 1987 November 1992 No change 7.Loan Approval Date January 1988 December 1992 No change 8.Loan Signature Date July 1988 June 1993 May 1989 (OL), May 1993 (SL) 9.Date of Entry into Force December 1988 November 1993 March 1990 (OL), July 1996 (SL)
B. Project Data 1. Project Cost UA in million Item of Cost Appraisal Estimate Reappraisal Estimate Actual
Foreign Exchange Component 31.52 46.02 46.02 Local Cost Component 7.06 7.96 13.09 Total Cost 38.58 53.98 59.11
2. Source of Finance i) Total Project UA in million Source of Appraisal Reappraisal Actual Finance F.E. L.C. Total % F.E. L.C. Total % F.E. L.C. Total % ADF 14.31 2.86 17.17 44.5 16.96 3.07 20.03 37.1 14.32 5.70 20.02 33.9 K.Fund 7.10 - 7.10 18.4 16.15 - 16.15 29.9 16.15 - 16.15 27.3 BADEA 7.81 - 7.81 20.2 10.88 - 10.88 20.2 10.88 - 10.88 18.4 OPEC 1.58 - 1.58 4.1 2.04 - 2.04 3.8 2.04 - 2.04 3.4 GOL 0.72 4.21 4.93 12.8 - 4.89 4.89 9.0 2.15 7.87 10.02 17.0 Total 31.52 7.06 38.59 100 46.03 7.96 53.98 100 45.54 13.57 59.11 100
ii) ADF Component UA in million Source of Appraisal Reappraisal Actual Finance F.E. L.C. Total % F.E. L.C. Total % F.E. L.C. Total % ADF 14.31 2.86 17.17 97.7 16.96 3.07 20.03 98 14.33 5.70 20.03 83.5 GOL - 0.40 0.40 2.3 - 0.34 0.34 2 - 3.96 3.96 16.5 Total 14.31 3.26 17.57 100 16.96 3.41 20.37 100 14.33 9.66 23.99 100
Appraisal Reappraisal Actual
3. Effective Date of First Disbursement : Dec.1988 (Revised Dec.90) Dec.1990 4. Effective date of vii Last Disbursement : Dec. 1994 ------June1999 5. Commencement of Project July 1989 Nov. 1992 February1993 6. Completion of Project June 1992 Nov. 1995 August 1997
C. Performance Indicators (ADF Component):
1. Cost Overrun : UA 6.42 million 2. Time Overrun : 62 months Slippage on Effectiveness (%) : 125% Slippage on Completion Date (%) : 138% Slippage on Last Disbursement (%) : 75% Number of Extensions of Loan Validity Period : Two (first by 36 months & second by 18 months) 3. Project Implementation Status : Completed 4. Institutional Performance : Borrower/Executing Agency : Not Satisfactory African Development Fund (ADF) : Satisfactory Co-financiers : Satisfactory
5. Contractor Performance : Not Satisfactory 6. Consultant Performance - Supervision Consultant : Not Satisfactory - T.A. Consultant : Satisfactory 7. Economic Internal Rate of Return (EIRR) – Entire Road Appraisal : 13.8% Actual : 5.5 %
D. Missions # of Composition Man- Type Persons days 1.Identification n/a n/a n/a 2.Preparation n/a n/a n/a 3.Appraisal 2 Tpt. Economist and Civil Engineer 28 4.Follow up/Launching 1 Loans Officer 15 5.Supervision (5) 2 Tpt. Economist & Tpt. Engineer 100 6.PCR 3 Tpt. Economist, Tpt. Engineer & 30 Environmentalist
E. ADF Loan – Bank Disbursements (UA Million)
Item/Year Appraisal Reappraisal Actual Estimate Estimate viii 1988 0.41 1989 2.27 1990 4.81 0.22 1991 6.25 0.18 0.13 1992 2.04 0.42 0.08 1993 1.41 12.53 4.05 1994 4.46 4.57 1995 2.13 4.25 1996 0.31 4.79 1997 1.43 1998 0.35 1999 0.13 Total Disbursed 17.17 20.03 20.00 Undisbursed Balance 0.03 Amount Cancelled 0.03
F. Details of Contractor and Consultants
Description Contractor Supervision Technical Assistance Consultant Consultant 1.Name M.C.C.K (j.v.) DIWI Consult Frank Graham & Intl. 2.Responsibility Execution of Pre-contract and Technical assistance to RB for construction works supervision services project implementation 3.Date of Contract a) Signature October 1992 August 1989 December 1993 b) Commencement February 1993 September 1989 January 1994 c) Completion August 1998 January 1998 February 1999 5. Duration of 5 year 6 months 8 year 5 months 5 year 2 months Contract 5.Amount of a) Initial : a) Initial : a) Initial : £ 426,888 & Contract Maloti 49,937,069 Maloti 4,417,701 Maloti 477,207 b) Actual: b) Actual: b) Actual: £ 823,750 & Maloti 103,329,492 Maloti 10,017,530 Maloti 477,207 LESOTHO: Oxbow - Mokhotlong Road Project - Retrospective MPDE Matrix PCR Team: K.S.H. Rao / S.B.Turay, OCDS.4 Means of Verification Important Narrative Summary (NS) Verifiable Indicators (VI) (MOV) Assumptions Goals: (Goal to Super goal) 1.1 To provide a basic road network serving the main population centres in 1.1 Increase in the total length of basic 1.1 Annual road construction western lowlands and foothills. road network including rehabilitation/ statistics from Roads Branch, MOW. 1.2 To reduce dependence on South paving of rural roads in the country. Africa. 1.2 Road network condition data. 1.3 To improve and upgrade the primary 1.3 Annual traffic data. 1.2 Overall growth in traffic. road network that traverses the extremely difficult mountainous terrain regions of 1.4 National Income Statistics 1.3 Improved socio-economic welfare the north-eastern parts of the country to in the project area. develop their full potential as well as ensure political and administrative integration with the rest of the country. 1.4 To create institutional capability to plan and maintain a transport network compatible with resource constraints. ix Project Objective: (Project Objective to Goal)
1. To upgrade the existing gravel road 1.1 Reduction in VOC by 35% when 1.1 Estimates of VOC using HDM 1.1 Ability of GOL to between Oxbow and Mokhotlong to the road was open to traffic in model. provide adequate financial bitumen standard to provide a faster, safe 1998. 1.2 Updated EIRR indicates a rate of resources for carrying out and serviceable all weather access 1.2 Growth in traffic 5.45.% as compared to the appraisal maintenance works through the mountainous region which 1.3 Maintenance Budgets. EIRR of 13.8%. effectively. has considerable tourism and dianond 1.3 Traffic: 260 ADT in 1999 1.2 Availability of technical mining potential. and managerial staff.
Outputs: (Output to Project Objective) 1. Completely rehabilitated road 1.1 Actual length of completed road. 1.1 Progress Reports from the between Oxbow and Mokhotlong (109 Borrower and ADB supervision 1.1 Project completed with km) missions. cost over run (UA 20.56 million) and time over run (5 years). Further, claims 1.2 Project Completion Reports dispute with contractor to be (PCR). resolved. 1.2 Budget for the project and maintenance provided.
Activities/Components: Inputs/ Resources: (Activity to Output)
Appraisal Cost Estimates Actual Project Costs (UA million) (UA million) 1.1 Procurement of consultancy ADF loans (original as well services for design review including Category F.E L.C. Total Category F.E L.C. Total as supplementary were fully updating of tender documents and for Works 18.25 3.38 21.63 Works 42.35 11.42 53.77 utilised. supervision of construction works. Supervision 2.08 0.52 2.60 Supervision 2.31 2.01 4.32 Tech. Asst. 0.72 0.04 0.86 Tech. Asst. 0.88 0.14 1.02 1.2 Procurement of contractor for Contingency 10.45 3.11 13.56 Total 45.54 13.57 59.11 carrying out road upgrading works. Total 31.50 7.05 38.55
Actual Financing Plan Appraisal Financing Plan (UA million) 1.3 Procurement of consultancy services (UA million) Source F.E. L.C. Total for technical assistance consisting of two Source F.E. L.C. Total ADF 14.32 5.70 20.02 engineers for a duration of four years ADF 14.32 2.85 17.17 BADEA 7.80 - 7.80 each. BADEA 7.80 - 7.80 OPEC 1.38 0.18 1.56 1.4 Actual upgrading of the project road. OPEC 1.38 0.18 1.56 KAFEAD/ KAFEAD/ GOL 22.04 7.69 29.73 GOL 8.00 4.02 12.02 Total 45.54 13.57 59.11 Total 31.50 7.05 38.55 Note: Any inconsistencies in the above matrix may be explained by the fact that the original project design was not based on the MPDE Matrix approach, and the matrix has been formulated in retrospect. 1
1. INTRODUCTION
1.1 The Kingdom of Lesotho is a small landlocked country surrounded by the Republic of South Africa (RSA). The country is mountainous with altitudes ranging between 1000 m and 3500 m above sea level. The land area of the country is about 30,350 km2. The eastern part of the country is largely mountainous comprising about 75% of the total land area where peaks can be as high as 3,480 metres above the sea level. Lesotho has a temperate type of climate. Snowfall occurs in some of the high mountains during winter. Rainfall is fairly well distributed through out the country, most of it during the summer (i.e. from October to April).
1.2 About 70% of the country’s total estimated population of 2.1 million (1999 estimate), live in the lowlands around Maseru, the capital city. The economy of Lesotho is highly dependant on service sector contributing to about 42% of Gross Domestic Product (GDP) followed by industry (40%) and agriculture (18%). Remittances from Basotho workers in South Africa constitute a major component of Gross National income; in certain years as high as 45%.
1.3 From 1975, when the first Bank loan was approved, the Bank’s total commitments in the transport sector in Lesotho have aggregated to UA 78.34 million, spanning over eleven operations comprising eight projects and three studies (Annex 1). Except for the recently approved Two Rural Roads Study (September 1999) all the other operations have been completed.
1.4 The Oxbow-Mokhotlong Road project was identified in the Lesotho Transportation Study (1973/74), as a section of the Leribe-Khamane-Oxbow-Mokhotlong Road and was recommended for construction in four phases. The first three phases, financed by African Development Bank (ADB) covered the construction to bitumen standard of Leribe-Butha Buthe-Joel’s Drift-Khamane-Oxbow sections. These have been completed. The Oxbow- Mokhotlong road formed the fourth phase. The project location is given in Annex 2.
1.5 Based on the recommendations of the economic viability (1981) and detailed engineering studies (1983) financed by the International Development Association (IDA), the GOL approached the Bank for assistance to implement the project. Following the Bank’s appraisal mission to Lesotho in September 1987, an African Development Fund (ADF) loan of UA 17.17 million was approved in January 1988. The project was co-financed by Kuwait Fund, ADF, BADEA, OPEC and GOL. The project, however, encountered cost increases mainly because of the significant design modifications recommended by the supervision consultant. To assist the GOL in meeting the additional project costs, as agreed in co- financiers meeting held in November 1991, ADF approved a supplementary loan for UA 2.86 million in December 1992.
1.6 This Project Completion Report (PCR) is based on the Borrower’s PCR submitted in April 1999 and also data and information collected by a mission which visited Lesotho in January 2000. The sources of information and documents referred are listed in Annex 3.
2. PROJECT OBJECTIVE AND FORMULATION 2 2.1 Project Objectives
The objectives of the sector were to i) provide a basic road network serving the main population and production centres in the western lowlands and foothills, ii) reduce dependence on South Africa, iii) improve and upgrade the primary road network that traverses the extremely difficult mountainous terrain regions of the north-eastern parts of the country to develop their full potential as well as to ensure political as well as administrative integration with the rest of the country and iv) create institutional capability to plan and maintain a transport network compatible with resource constraints. The project objective was to upgrade the gravel road between Oxbow and Mokhotlong to a bitumen standard to provide a faster, safe, and serviceable all weather access through the mountainous region, which has considerable tourism and diamond mining potential.
2.2 Project Description
The project as designed and implemented consisted of: i) upgrading the existing gravel road to bitumen standard of a 6-meter carriageway width and 1.0 meter sealed shoulder on either side from Oxbow to Mokhotlong (109 km) consisting of two sections a) Oxbow – Tlokoeng (72 km) - Lot 1 and b) Tlokoeng – Mokhotlong (37 km) - Lot 2, including drainage structures and ancillary works; ii) consultancy services for review of the design including updating of tender documents and supervision of construction works as per (i) above; and iii) technical assistance to the Roads Branch consisting of two engineers for a duration of 5 years each to assist in the management and administration of the project. While the construction of Lot 1 was funded by KFAED, BADEA, OPEC and GOL, the construction of Lot 2 and items ii) and iii) were financed by ADF and GOL.
2.3 Project Formulation
2.3.1 The project road is a critical section of the Leribe-Khamane-Oxbow-Mokhotlong road (i.e., Main Road A1) and was identified in the Lesotho Transport Study (1973/74) for upgrading to bitumen standard. Due to the limited resources including capacity of the Roads Branch for contract management, the improvement of the Main Road A1 was programmed for implementation in phases. The project road (i.e., Oxbow-Mokhotlong section) was included in the Fourth National Development Plan (1986/87 to 1990/91).
2.3.2 The Oxbow-Mokhotlong Road constitutes a vital link in the northern perimeter trunk road connecting Maseru, the capital city, with Mokhotlong in the east, and forms the last section of the northern perimeter road linking the eastern mountain region to the west and also to the southern perimeter road. Though the project road falls in Mokhotlong district, its area of influence extends much beyond up to Butha Buthe and Thaba Tseka districts.
3. PROJECT EXECUTION
3.1 Effectiveness and Start-up 3 After approval of the loan in January 1988, it took 28 months for the GOL to fulfil all the conditions precedent to entry into force and the loan was declared effective in May 1990. These conditions are given in Annex 4. One of the main reasons for the delay was that the consultant’s review brought out the deficiencies in the original design and suggested improvements which resulted in increase in the project cost. This in turn entailed additional time for sourcing supplementary financing and project implementation. Other reason for the delay was slow communications between the concerned ministries of the GOL, which, as per the executing agency, was difficult to improve.
3.2 Modifications
3.2.1 Though there was no change in project scope per se, the project design, particularly the bridge and pavement structures, had to be modified from the original design carried out in 1983. The consultant who was appointed in August 1989 to supervise the construction works was required to review the design and update the tender documents. The consultant made three major design changes. These are: (i) single-lane low level bridges were to be replaced with two-lane high level structures to avoid flood washouts; (ii) redesigning of the road pavement to accommodate increase in traffic loads and non-availability of suitable materials for construction along the proposed road corridor; and (iii) paving of shoulders to prevent the infiltration of rainwater and subsequent frost damage and to improve the safety of pedestrians.
3.2.2 The point at issue is that if the original designs were carefully reviewed by the Borrower and subsequently by the Bank, the inadequacies mentioned by the consultant would have been rectified before appraisal. Instead the Borrower accepted the original designs that were considered unsatisfactory. This state of affairs is not uncommon with many Borrowers. Consultant’s reports are generally accepted without careful examination. The effect of this normally results in high redesign costs coupled with associated delay at the time of project implementation.
3.2.3 The necessary redesigning referred above increased the project costs and in turn called for supplementary financing from donors to bridge the gap. At co-financiers meeting in November 1991, it was agreed to allocate the extra cost amongst the financiers with ADF required to contribute an additional UA 2.86 million and Kuwait Fund/OPEC/BADEA providing the rest. Accordingly the Bank approved a supplementary loan of UA 2.86 million in December 1992.
3.3 Implementation Schedule 3.3.1 The process of project start up activities covering short-listing of consultants, issuing of Request for Proposal (RFP) and evaluation of consultants’ proposals began about three months behind the appraisal schedule. However, the Bank did not accept the GOL’s recommendation to negotiate with the second lowest bidder as this was not in line with the Bank Rules of Procedures for the Use of Consultants. Protracted correspondences between the Bank and the GOL on the matter continued for over a period of one year. Finally, the GOL negotiated with the lowest bidder (Messrs. DIWI Consult) and the contract signed in August 1989. This delay could not be made up during the pre-contract services and civil works contract. In fact, pre-contract services including design review, tendering, evaluation of bids and negotiations lasted for about three years. The delay in actual construction was relatively less (i.e. about one and a half-year). Thus the major delay in the project implementation was during the pre-contract service phase that spanned over 3 years 4 compared to one year estimated at appraisal. Major factors that contributed to the delay during implementation were:
a) The GOL’s insistence on negotiating with the second lowest bidder (supervision consultant) which was not in line with the Bank’s procurement rules; b) Design review and securing of supplementary funds; c) Incomplete mobilisation of plant, labour and materials by the contractor; d) Adverse weather conditions (abnormal rainfall); and e) Increase in quantity of rock to be excavated.
3.3.2 The consultancy contract was for pre-contract services, construction supervision and post contract services covering rectification of defects during the maintenance period as well as preparation of final accounts and reports. The consultancy contract ended in September 1998 compared to the appraisal estimate of September 1993. The delay as compared to the appraisal schedule was about five years.
3.3.3 The appraisal, reappraisal and actual implementation schedule for the project are as under and also depicted in Annex 5.
Activity Appraisal Timing Reappraisal Timing Actual Timing 1. Supervision Consultant Appointed June 1988 August 1989 August 1989 2. T.A. Consultant Appointed August 1988 - December 1993 3. Contractor Pre-qualified November 1988 July 1991 July 1991 4. Tenders Evaluated April 1989 - June 1992 5. Contract Awarded June 1989 October 1992 February 1992 6. Works Commenced July 1989 November 1992 March 1993 7. Works Completed Lot 1 June 1992 November 1995 August 1997 Lot 2 June 1991 January 1995 December 1995 8. Maintenance Completed Lot 1 June 1993 November 1996 August 1998 Lot 2 June 1992 January 1996 March 1997 9. Supervision Completed September 1993 April 1996 January 1998 10. T.A. Completed September 1993 April 1996 February 1998
3.3.4 The total time overrun of the project as compared to appraisal implementation schedule was 62 months comprising 14 months for procuring supervision consultant, 30 months in design review and sourcing of supplementary funds and 18 months in the actual construction of the road.
3.4 Procurement
The goods and services required for the project were procured in accordance with the Bank’s Rules. The works contract was procured on the basis of International Competitive Bidding (ICB) following pre-qualification of contractors. The consultants for supervision and technical assistance were selected through a short-list of selected firms, in accordance with the ADB/ADF Guidelines for the use of Consultants. The actual procurement was delayed as compared to the appraisal schedule for the reasons mentioned in paragraph 3.3.1. Further, the 5 GOL recommended the second lowest evaluated bidder for awarding the supervision consultancy. The Bank, however, did not accept this recommendation as it was not in line with the Bank’s procurement rules and impressed upon the GOL to negotiate with the lowest evaluated bidder. Finally the contract was awarded to the lowest evaluated bidder.
3.5 Reporting
3.5.1 As required in the general conditions of the Loan Agreement, the GOL prepared and submitted quarterly progress reports. Their content in terms of keeping the Bank continually informed of the progress on the project was satisfactory. The Borrower’s PCR was submitted in March 1999.
3.5.2 The GOL has submitted only one audit report for this project covering the period 1989 to 1997. Non-submission of audit reports has been a common deficiency in the past affecting many Bank funded transport sector in Lesotho. This problem is being addressed by the inclusion of an audit component on new Bank funded projects where considered necessary.
3.6 Project Costs and Financing Sources
3.6.1 At appraisal, the total cost of the project (net of taxes) was estimated at UA 38.58 million. The project was financed by ADF, Kuwait Fund, BADEA, OPEC and GOL. The revised cost at reappraisal to accommodate the increase in cost due to the necessary design modification was UA 53.98 million. The actual cost of the project at completion was UA 59.11 million, which exceeded the appraisal estimate by about 50% and reappraisal estimate by 10%. This clearly points to the crucial importance of reviewing the detailed designs and the cost at the time of appraisal. If this had been done, the estimates could have been more close to the reappraisal estimates.
3.6.2 As to the ADF financed components namely construction of Lot 2, supervision consultant and technical assistance, the appraisal estimate was UA 17.56 million. However, the actual cost of the project at completion was UA 23.98 million indicating a cost overrun of 37%. More specifically, the cost of supervision consultancy has increased from the contract price of Maloti 4,417,701 to Maloti 10,017,530 at the time of completion. This increase is attributable to extra cost on account of i) additional site investigations for the bridges, ii) design modifications for road widening and provision of high level dual lane bridges, iii) provision of additional staff for the supervision of works, and iv) additional costs incurred by the consultant over extended period of construction. These additional costs were approved by means of four addenda.
3.6.3 As against the contract price of Maloti 49,937,069, the actual cost of civil works for Lot 2, was Maloti 103,329,492. The major components of this cost increase were additional rock excavation, new items (mainly drainage) and revision of rates as per the contract provisions. This cost increase was approved by way of an addendum to civil works contract. At the time of project completion, the actual cost of the Technical Assistance consultant was £823,750 and Maloti 477,207 as compared to the initial contract value of £426,888 and Maloti 477,207. This cost increase was mainly due to the additional construction period and was approved through an addendum.
3.6.4 For the ADF financed project components, as per the appraisal financing plan, ADF was to contribute UA 17.17 million representing 97.7% of project cost consisting of 100% of 6 the foreign exchange costs and 88% of local costs. The GOL was to provide the balance funds constituting 2.3% of the project cost or 12% of local costs. Of the actual project cost of UA 23.98 million, ADF component was UA 20.02 million and the GOL’s contribution was UA 3.96 million, which included a cost overrun of UA 3.62 million. As a result, the GOL funded 16.5% of the actual project cost as against the appraisal estimate of about 2%. One major factor that contributed to this change in funding proportions was that the cost overruns after the reappraisal (supplementary loan) were fully borne by the GOL. Table 3.1 gives the project cost estimates as at appraisal versus the actual. A comparison of actual financing and that anticipated at appraisal is presented in Table 3.2.
Table 3.1: Summary of Project Costs – ADF Component (Appraisal vs. Actual) (UA million) Appraisal Estimate Reappraisal Actual Category F.E. L.C. Total F.E. L.C. Total F.E. L.C. Total 1. Construction 6.79 1.26 8.05 12.31 2.17 14.48 11.13 8.24 19.37 2. Supervision 2.08 0.53 2.61 1.10 0.28 1.38 2.31 1.38 3.69 3. Tech. Assist. 0.72 0.04 0.76 0.76 0.04 0.80 0.88 0.04 0.92 4. Contingencies 4.82 1.42 6.24 2.79 0.92 3.71 - - - Total 14.31 3.25 17.56 16.96 3.41 20.37 14.32 9.66 23.98
Table 3.2: Sources of Finance (Appraisal vs. Actual) (UA million) Appraisal Estimate Reappraisal Actual Source F.E. L.C. Total (%) F.E. L.C. Total (%) F.E. L.C. Total (%)
ADF 14.31 2.86 17.17 97.7 16.96 3.06 20.02 98 14.32 5.70 20.02 83.5 GOL - 0.39 0.39 2.3 - 0.34 0.34 2 - 3.96 3.96 16.5
Total 14.31 3.25 17.56 100 16.96 3.40 20.36 100 14.32 9.66 23.98 100
3.7 Disbursements
The slippage in actual disbursement is broadly in line with the delay in project implementation. The ADF loan amount, as at appraisal, was to be fully disbursed during 1988 – 1993. However, the actual disbursements were spread over ten years (1990 – 1999). A comparison of anticipated and actual disbursements is presented in Table 3.3. Though the actual disbursements are spread over 10 years, more than 95% was disbursed during the 5- year (1993 – 1997) period. Actual disbursements by ADF and GOL are given in Annex 6.
Table 3.3: Loan Disbursement Profile Disbursement (UA million)
Cum. % of Year As at Appraisal As at Reappraisal Actual Actual Amount Disbursement Amount Cum. % Amount Cum. % Disbursed to 7 1988 0.41 2.39 1989 2.27 15.61 1990 4.81 43.56 0.22 1.10 1991 6.25 79.97 0.18 0.90 0.13 1.75 1992 2.04 91.85 0.42 2.90 0.08 2.15 1993 1.41 100.00 12.53 65.23 4.05 22.40 1994 - 4.46 87.41 4.57 45.25 1995 2.13 98.00 4.25 66.50 1996 0.31 100.00 4.79 90.45 1997 1.43 97.60 1998 0.35 99.35 1999 0.13 100.00 Total 17.17 20.03 20.00 3.8 Performance of the Contractor, Supervision Consultant and Technical Assistance
Contractor
3.8.1 The performance of the contractor was not satisfactory mainly because of i) slow and incomplete mobilisation of plant, labour and materials, ii) inadequate management of resources, and iii) poor safety records/procedures and environmentally not aware. Though these matters were constantly addressed during the progress meetings, there was no significant improvement. The PCR mission inspected the road and found that the road has prematurely exhibited some surface defects (para 4.2.2) after the road was fully opened to traffic 3 years ago in 1997.
3.8.2 Towards the end of project implementation, the contractor had demobilised from the project site without carrying out necessary environmental mitigation measures like reinstating the borrow pits, re-vegetating the slopes, etc. Based on the above, the contractor’s performance is judged as not satisfactory.
Supervision Consultant
3.8.3 The consultant was responsible for design review, pre-contract services and supervising the construction works. His performance was not considered satisfactory due to the following reasons. First, the quality of the design produced, especially for Lot 1 was in question and this has resulted in premature surface defects (para 4.2.3). Secondly, the bills of quantities produced for the tenders were not satisfactory inasmuch as these did not reflect the quantities of work that was expected. For example, the actual rock quantities were 430% more than the tender estimates. The packaging of the project into two lots was not rational and this led to inconsistencies in administration. The staffing during the supervision stage was not as per the contract and generally the staffing could have been of better quality. The supervision staff was demobilised by the consultant before the project was effectively completed. Further, the consultant had issued completion certificates without properly ensuring that all the pending works were completed. This resulted in unsatisfactory supervision of repairs under defects liability period and implementation of environmental mitigation measures. The consultant’s overall performance is therefore judged as unsatisfactory.
Technical Assistance Consultant
3.8.4 The Technical Assistance (T.A.) consultant was to i) provide advice to RB on technical matters relating to the contracts, ii) review the monthly & quarterly progress reports and monthly certificates of the contractor and consultant, iii) advise RB on the issue of claims and iv) assist RB on reimbursement and disbursement of donor funds. The technical problems 8 experienced on the project were unique by virtue of its terrain characteristics and other significant factors such as materials and weather. With the TA team in place, the RB could effectively involve itself in the investigation and resolution of the problems thus gaining considerable professional experience in a relatively short period. However, the TA was not that effective towards the end of completion of the project as the contractor demobilised without carrying out all the repair works environmental mitigation measures identified during the maintenance period. On the whole, the TA’s performance was satisfactory.
4. PROJECT PERFORMANCE
4.1 Overall Assessment
The project objective of upgrading the gravel road between Oxbow and Mokhotlong to bitumen standard was partially achieved. Because of this improvement the once difficult route is now relatively easy to make. The gradients of this road are still one of the highest in the country. However, nothing short of tunnels could reduce these gradients any further. Travel time between Oxbow and Mokhotlong that used to be about 4 hours is now reduced to about 2 hours (50% reduction). The road is in a fair condition with an average roughness of 3.2m/km. The road is due for resealing during the fiscal year 2000/2001. However, actual realization of the project benefits will depend on the extent of traffic materialization during the life of the project (see Section 4.2).
4.2 Operating Performance Results
4.2.1 The road was fully opened to traffic 3 years ago in 1997 and is now generating long distance traffic as anticipated in the Lesotho Transportation Study (1980). However, according to available traffic data, growth rates are moderate and total traffic is much below the appraisal estimates. However, it is expected that winter tourism development and the recently reopened mines in Letseng La-Terae will generate more traffic on the project road in the immediate future.
4.2.2 Inspection of the project road by the PCR mission as well as the visual condition surveys and objective mechanical measurements of road roughness and pavement deflection recently carried out by the Roads Branch under the Pavement Maintenance Management System (PMMS) point to a fair operating performance of the road. The average roughness of the road is 3.2 m/km implying that the riding quality of the road is approaching its terminal value of 3.5 m/km. Average value of deflection measurements is 0.96 mm, thereby indicating good structural integrity of the pavement. The average value of Visual Condition Index for the entire road is 72 implying that the road in a fair condition (Annex 8). The above measurements indicate that the road is due for rehabilitation during next year. Under the World Bank funded Road Rehabilitation and Maintenance Project (RRMP), the project road is a candidate for resealing in 2001.
4.2.3 Notwithstanding, the road traverses through difficult mountainous terrain of altitudes ranging from about 2000 to 3200 meters above sea level. Due to design and construction defects coupled with harsh winter conditions and inadequate snow clearing facilities, the road is currently exhibiting premature localised distress such as potholes, rutting and hairline cracks. These distresses can be repaired before resealing the entire stretch. 9 4.2.4 Slope slides and falls are also damaging the pavement, guard-rails and side drains. Although these are repaired, the maintenance demands far exceeded the requirements of the maintenance gangs. In effect, obstruction of the side ditches is already resulting in uncontrolled runoff, causing serious erosion and slides if the situation is not timely arrested. The Roads Branch should undertake a study to find ways of stabilising the slopes as a long- term solution in order to preserve the investment already made on the road. In the interim, the Roads Branch should continue to provide adequate routine maintenance of the road section.
4.2.5 The upgraded road partially meets the project objective of providing a safe, faster and all weather bitumen road between Oxbow and Mokhotlong. The surface condition of the road needs to be improved to fully achieve the project objective. The actual traffic levels since opening of the upgraded road in juxtaposition with the appraisal expectations are given in Table 4.1. Table 4.1 Actual and Projected Traffic on the Project Road (Vehicles/Day) Year Estimated at Appraisal Estimated at Reappraisal Actual * (1) (2) Lot 2 Entire Road Lot 2 Entire Road Lot 2 Entire Road
1993 269 233 1994 300 260 419 370 1995 330 286 464 410 1996 363 314 512 453 241 213 1997 399 346 565 501 280 248 1998 439 380 625 554 309 273 1999 483 418 691 613 294 260 2000 531 460 763 677 314 278 2005 855 741 1087 967 438 388 2010 1378 1194 1520 1348 609 539 2012 1667 1444 1668 1488 696 616 2015 849 751 2017 969 857
Source: i) Appraisal Reports, 1987 and 1992 and ii) Roads Branch Traffic Counts *Actual up to the year 1999.
4.2.6 All through the comparison period (1996 to 1999), the actual traffic was, on the average, 67% of the appraisal projections. Two major factors that contributed to lower level of actual traffic on the project road could be: (a) the observed traffic growth (6.5%) was much below the projected rates of 10-12% and (b) the developments anticipated in the PIA (e.g. hydro-electric scheme at Oxbow; mining operations at Kao and Latseng areas; and tourism and agricultural developments) have, to a large extent, not materialised.
4.3 Management and Organisation Effectiveness
4.3.1 The MOPWT through the Roads Branch was responsible for implementation of the project. All the financial and budgetary matters related to the project were handled by and through the accounts section of the MOPWT. The MOPWT has four divisions: Architect Branch (AB), Roads Branch (RB), Labour Construction Unit (LCU) and more recently Civil Works Section (CWS) that used to be under the Ministry of Home Affairs (MHA).
4.3.2 The RB is headed by Chief Roads Engineer (CRE). The organisational structure of both the implementing and the monitoring units has not changed radically from the time of appraisal in 1987. The only change with MOPWT is that it has now taken over the CWS, 10 which is responsible for village feeder roads. The organisation chart for the Roads Branch, MOPWT is attached as Annex 9.
4.3.3 One significant development that has taken place since the appraisal of the project is the installation of a Pavement Maintenance and Management System (PMMS) in RB. The PMMS is being funded by International Development Association (IDA) and acts as a management and planning tool for the upkeep of GOL’s road network. The GOL has also signed an agreement with the IDA under the Road Rehabilitation and Maintenance Project (RRMP). Under this project, the GOL has set aside each year enough funds to achieve an acceptable level of maintenance for the road network. The minimum amount of funding is determined through the PMMS. This agreement runs up to 2003. Beyond this period, funding for road maintenance will come from the Road Fund (RF) which has been recently commissioned specifically for road maintenance and rehabilitation.
4.3.4 For efficient management of the road network, the GOL is committed to institutional reforms for improvement of the institutional environment of MOPWT through regrouping of the road agencies under a single management. This is a component of the on-going RRMP. Though the progress on this component is rather slow, the consulting services for carrying out restructuring and manpower development study is expected to be launched soon.
4.4 Staff Recruitment, Training and Development
In the year 1999, RB has an establishment for 39 professional staff, of which 15 positions were not filled. In sub-professional and skilled worker category, there were 425 establishment posts of which 43 were vacant. Of the 43 vacancies, process is underway to fill 31 positions. The technical problems experienced on the project were unique by virtue of its altitude and other significant factors such as materials and weather. Further, the international nature of the contract funded by multiple donors required special technical and administrative skills. With the Technical Assistance (TA) in place, the present project had a significant impact in enhancing professional and administrative experience of the RB staff. During the course of the TA, three engineers gained hands-on-experience. Of the three, one has joined the private sector in South Africa and the remaining two have been promoted. At present, the RB is left with only one TA under PMMS who is scheduled to leave by June 2000. Various donors have financed fellowships and in-country training at both the undergraduate and graduate levels. However, many trained engineers eventually leave RB to join the private sector both in Lesotho and South Africa. The loss of trained and qualified staff to the private sector will continue to affect the sustainability of road projects until the outflow is restrained.
4.5 Economic Performance
Overview
4.5.1 The project road is located in the north eastern part of Lesotho starting from Oxbow and running towards east to Mokhotlong (109 km). The project road forms a vital link in the northern perimeter trunk road that connects Maseru, the capital city, with Mokhotlong in the East through the western agricultural lowlands and the main centres of population of Leribe and Butha Buthe districts.
Appraisal Expectations 11 4.5.2 At appraisal, the volume and composition of the traffic that is expected to patronise the improved road during its economic life (i.e. 1993 to 2012) formed the basis for its economic justification. Based on the traffic surveys and analysis, the average base year (1987) normal traffic was estimated as 70 vehicles per day (vpd) for Oxbow-Tlokoeng section (Lot 1), 57 vpd for Tlokoeng-Mokhotlong section (Lot 2) and 62 vpd for the entire road from Oxbow to Mokhotlong. The broad percentage of traffic mix was: 5% cars, 65 % light goods vehicles, 5% buses and 24% trucks.
4.5.3 Future volumes of normal traffic that are likely to use the road during its economic life span (1993 to 2012) were derived by applying annual growth rates of 10-12% up to the last year of the project (2012). The economic cost of the project comprised the cost of construction, supervision and physical contingencies as well as maintenance cost. All these costs were considered net of taxes and price escalation. The major quantifiable economic benefits for project were lower vehicle operating costs (VOC) and travel time, avoidance of maintenance cost and salvage value of the initial investment.
4.5.4 The streams of economic costs and benefits spanning over the design life of 20 years were calculated and the Economic Internal Rate of Return (EIRR) worked out as 13.80 % indicating that the project was viable. Sensitivity analyses covering two variants viz. a) 10% increase in project cost and b) 20% decline in project benefits indicated EIRR of 13% and 12% respectively. With these rates, the project could still be considered as viable.
Recalculation of Economic Internal Rate of Return (EIRR)
4.5.5 For recalculation of EIRR, the economic costs have been revised in the light of the actual construction costs. The economic benefits have been updated keeping in view the trends in traffic growth since the completion of the project.
4.5.6 The appraisal traffic forecasts have been updated in line with the observed base year traffic and annual growth rates (6.85%) and likely developments in the project influence area (PIA). As to the developments in the PIA, the recently reopened mines in Letseng are expected to be fully operational by August 2001. These mines are likely to provide employment to about 300 persons and this in turn would generate additional traffic. There is also significant potential for tourism development on Maloti-Drakensberg Transfrontier which falls within the PIA. Taking these factors into account, the revised traffic is estimated to increase from 309 vpd in 1999 to 969 vpd in 2017 (Annex 10).
4.5.7 The actual construction and supervision costs (net of taxes and price escalation) as well as the benefits emanating from the revised traffic forecasts formed the basis for reworking the EIRR. The major quantifiable benefits include savings in VOC, travel time and maintenance cost. The recalculated EIRR is 5.45% (Annex 11). This is much lower than 13.80% calculated at appraisal. The situation is mainly attributable to the increase in cost – by about 50% as compared to appraisal estimates and optimistic traffic growth scenario envisaged at appraisal. The actual traffic is about 50% of that anticipated at appraisal. In other words, the investment could not generate enough returns and is not worthwhile based on quantifiable economic benefits. Notwithstanding this aspect, the developmental nature and social desirability of the project insofar as it provided a safer and less costly all-weather access through the difficult mountainous terrain and opened up remote rural areas, need not be overemphasised.
5. SOCIAL AND ENVIRONMENTAL RESULTS 12 5.1 Social Impact
5.1.1 Apart from the direct economic benefits of the project that have been discussed in the preceding sections of the report, the Oxbow-Mokhotlong road, as expressed by a wide spectrum of project beneficiaries during a meeting with the PCR mission at Mokhotlong, has had positive social impact in the area. The first related to direct and indirect employment for the local population during the project construction phase. Secondly, the road has improved mobility and access to public services especially for the rural dwellers living in the project influence area.
5.1.2 With the upgraded road, the travel time between Oxbow and Mokhotlong is now 2 hours compared to 4 hours before the improvement. This has culminated in improved transport services between Mokhotlong and Oxbow (about 15 taxis ply each way per day) and Mokhotlong and Maseru (two stagecoach buses each way per day). Availability of better transport has enabled the people engaged in petty trade (especially women) to get their supply every day from Butha Buthe area. The supply of agricultural inputs as well as access to market areas has improved significantly.
5.1.3 Further, the road used to be totally cut off during the rainy season. With the provision of high level bridges, the road is passable throughout the year. Access to public facilities such as health, education, commercial and administrative centres has also improved. Prior to upgrading, because of the very bad condition of the road, in case of medical emergency patients used to be airlifted to Maseru. Now, Maseru can be reached from Mokhotlong within 4 hours, even in case of medical emergencies without much inconvenience to the patient. With better communication, more qualified professionals are getting attracted to schools, medical centres and development projects located in Mokhotlong area.
5.1.4 The upgraded road has also induced some developments in the project area. The recently reopened mines in Letseng are expected to provide direct employment to about 300 persons. Again, the proposed development of tourism on Maloti-Drakensberg Transfrontier is likely to generate about 1800 jobs. These additional jobs would obviously enhance the income levels in the project area which in turn would contribute to increase in demand and enhanced savings.
5.2 Environmental Impact
5.2.1 Though the appraisal report included some provisions for environmental management and mitigation, most of these measures were not implemented. Borrow pits were not reinstated nor provided with topsoil cover. Further, all borrow pits and quarry sites were left unfenced and started to accumulate stagnant water providing a breeding ground for mosquitoes. Spoil materials were disposed next to the road representing a severe disturbance to the scenery and providing a breeding environment for rats and other hazards. Slopes were not vegetated in most of the cases and the very few areas with re-vegetation trials were not successful due to the poor techniques used.
5.2.2 These environmental problems were in part due to absence of environmental management and monitoring mechanism in Lesotho at that time. From the Bank side, the reality that environmentalists were rarely included in supervision missions, led to the continuation of overlooking the environmental mitigation by the contractor. However, the major responsibility lies with the supervising consultant (financed by the Bank) who was supposed to closely follow up construction activities including implementation of the few 13 environmental mitigation measures. Instead, the supervising consultant signed the completion certificate ignoring these issues among many others leaving no room for both GOL and the Bank for counter actions.
5.2.3 The GOL is planning to undertake an environmental audit for the project to quantify the damage along the project road and suggest a remedial plan. A further step is to explore various possibilities for financing the recommendations of the audit. The GOL will keep the Bank informed in this regard.
5.2.4 It is advisable that future projects be supervised closely by Bank missions including an environmentalist when necessary (at least at the mid-term review). In addition, the Borrower’s capacity for environmental monitoring and management should be assessed during appraisal and measures included for training and capacity building in case of non- adequacy. Environmental management plan should be prepared and annexed to the appraisal reports and reflected in the construction and supervision contracts with close supervision by the Bank.
6. SUSTAINABILITY
6.1 Due to design and construction defects coupled with severe weather conditions and lack of proper winter maintenance mechanism, the Oxbow-Mokhotlong section has prematurely exhibited some surface defects. To remedy the situation, scheduled periodic maintenance in the form of overlays or resealing, which is normally done seven years after completion, is due this year. The project section is a candidate for an overlay/resealing under RRMP during the year 2001.
6.2 In order to sustain the road maintenance activities, the Government has established in 1996 an independent source of financing through an autonomous Road Fund (RF), which started functioning from January 1998. In the initial stages, the RF will concentrate on routine maintenance due to the limited funds that are collected on the basis of existing tariffs. Once the system is fully operational and continuous flow of funds is ensured, the RF will gradually extend its scope to cover periodic maintenance and rehabilitation works. It can thus be concluded that the Government has adopted appropriate policy and fiscal measures to raise resources sufficient to maintain road network, including the project road, in serviceable condition.
7. PERFORMANCE OF THE BANK AND THE BORROWER
7.1 Performance of the Bank
7.1.1 At the time of project appraisal, the Bank’s performance did not take up the issue of update of the design with the GOL. This was important as the feasibility and detailed design studies funded by IDA were more than five years old at the time of appraisal. If the issue had been discussed with the GOL and engineering designs reviewed prior to appraisal, the delays and cost overruns attributable to this aspect could have been avoided. In fact, the cost overruns and implementation delays were not very significant in comparison with the cost and time schedules as envisaged at reappraisal. However, there were no deficiencies in the Bank’s performance noted during the project implementation. The project was considered one of the priority projects by the Government and was well received by the Bank. 14 7.1.2 Since the inception of the project, the executing agency received at least one supervision mission per year from the Bank. These missions were of assistance to both the project and the executing agency and to the Bank in successful implementation of the project. The borrower and executing agency were provided with all the necessary guidance and advice to ensure procurement of works, goods and services in the implementation of the project, as per Bank’s rules and procedures for procurement. To sum up, the overall performance of the Bank during the implementation of the project can be termed as satisfactory.
7.2 Performance of the Borrower/Executing Agency
7.2.1 The GOL was represented by the Roads Branch (RB) of the MOPWT as the Executing Agency (EA). The EA was responsible for all the technical, management and disbursement relating to the project execution and also co-ordinated with the Bank on all relevant issues. The RB also contributed to project supervision by providing a whole time co- ordinator in compliance with the conditions precedent to loan effectiveness.
7.2.2 The performance of the EA during the project preparation as well as implementation was far from satisfactory. The detailed designs prepared by the consultant, under IDA funding, were approved without proper review. The supervision consultant’s review clearly brought the inadequacy of the original designs, modification of which entailed significant increases in project cost and implementation delays.
7.2.3 Towards the completion of the construction of the project, the EA was not effective in monitoring the project. The supervision consultant issued a completion certificate even when some repair works identified during the maintenance period and environmental mitigation measures were not completed. The contractor demobilised from the site without carrying out the identified works. Despite this, the EA returned the performance bond to the contractor. This has left no room for the EA to initiate any legal action against the contractor.
7.2.4 Generally the EA ensured timely submission of certificates for payment to the Bank through the Ministry of Finance. At times, inadequate documentary evidence of expenditure caused problems. Efforts were however made by the EA to minimise such delays. On the whole, the implementation performance of the EA is, therefore, not satisfactory.
7.3 Performance of Co-financiers
As Lot 1 construction was jointly financed by three donors initially there was some confusion as to the basis of cost sharing among the donors. This confusion remained till a Kuwait Fund/BADEA/OPEC mission to Lesotho in July 1995 when the matter was resolved and agreed percentage shares adopted. On the whole, performance of these co-financiers was satisfactory.
8. OVERALL PERFORMANCE RATING
8.1 Considering major indicators like i) relevance and achievement of objectives, ii) institutional development and iii) sustainability, the project outcome with an average score of 2.53, has been rated as satisfactory on a rating scale ranging from highly satisfactory (4) to highly unsatisfactory (1). 15 8.2 The project implementation performance has, however, not been satisfactory with an average score of 1.5 (Annex 7). This is mainly attributable to high cost overruns (50%) and implementation delays (about 5 years). In terms of the appraisal and supervision activities, the Bank’s performance with an average score of 2.5, is rated as satisfactory.
9. CONCLUSIONS, LESSONS LEARNT AND RECOMMENDATIONS
9.1 Conclusions
9.1.1 Achievement of Objectives: The objective of the project was to upgrade the existing road linking Oxbow and Mokhotlong in support of GOL’s transportation strategy of improving the road network that traverses the extremely difficult terrain regions of the north- eastern part of the country to bitumen standard to provide safe, serviceable all weather access along the periphery of Lesotho. This link provides faster movement of goods and passenger traffic from Oxbow to Mokhotlong through difficult mountainous sections. The project was also expected to improve road connection and reduce the cost of movement of goods and passengers between western foot-hill areas to Mokhotlong. It was also to link the rural areas in the eastern mountains so as to foster better integration of people of this area into the mainstream of the economic and social life of the country.
9.1.2 The upgrading of the road has been completed, and it has helped in connecting Maseru with important centres in the highly difficult hilly terrain in the north-eastern part of the country. Further, the condition of the road has improved and has contributed to the reduction in the backlog of maintenance, travel time and VOC on the main road network in Lesotho. The project road has also facilitated new developments in the project area, e.g. reopening of mines in Letseng, development of tourism, etc. In view of the premature surface defects exhibited by the road, there is a need to rehabilitate the road now to protect investment already made.
9.2 Lessons Learnt
9.2.1 The original design (bridges as well as pavement) was not suitable for the project road traversing the mountainous region where wet conditions are prevalent due to heavy rainfall and snowfall. In fact, the experience gained from the contiguous Khamane-Oxbow road section was not reflected on this section. The key lesson is that for future projects care should be taken by the Consultant to formulate appropriate pavement design taking due account of the physical features and specific requirements of the project area. Further, the designs should be thoroughly reviewed by the GOL prior to their approval.
9.2.2 A major problem encountered along the project road is unstable cut slopes, particularly along the high mountainous sections (about 3000 m). This has resulted in constant slips and rock falls. This results in continuous destruction of guardrails, drainage structures, etc. Although a permanent maintenance crew is in place to clear the rock falls, the maintenance demands far exceed the maintenance gangs. It is recommended that a study be undertaken by the GOL to find a way of stabilising the slopes. This experience would be useful for future projects in similar mountainous areas.
9.2.3 The actual project cost exceeded the appraisal estimate by about 50% mainly because of the changes in the design. The level of actual traffic on the project road is about 67% of the appraisal estimate. The increase in project cost coupled with low level of traffic materialisation brought down the appraisal EIRR from 13.8% to 5.5%. To obviate such a 16 situation, appraisal missions should undertake a review of the i) design and ii) existing and anticipated traffic levels. Further traffic projections should be prepared under three scenarios viz. pessimistic, moderate and optimistic. The project appraisal should, however, be based on moderate traffic scenario.
9.2.4 Absence of effective emphasis on environmental issues has led to problems that could impede development potential in the project area. To avoid such implications in the future, environmental and other cross-cutting issues should be closely supervised by environmental and social experts on a regular basis during project implementation. It is advisable that future road projects be supervised by Bank missions including an environmentalist when necessary (at least at the mid-term review).
9.3 Recommendations
9.3.1 For future projects, the Borrower should ensure that pavement design takes due account of the physical features and specific requirements of the project area.
9.3.2 The GOL may consider financing a study to find a way of stabilising the slopes on the project road. This experience would be useful for future projects in similar mountainous areas.
9.3.3 When feasibility and detailed design studies are not funded by the Bank, there is a need to ensure the appropriateness of the designs and the robustness of the project cost estimates through a preparation mission. Such preparation missions are all the more crucial if the studies are dated. The project viability analysis should not be based on optimistic traffic scenario, but rather reflect a moderate situation.
9.3.4 For future road projects, the Bank’s supervision missions should include an environmentalist when necessary (at least for mid-term review). Annex 1
LESOTHO
Project Completion Report: Oxbow-Mokhotlong Road Project
The Bank Group Financed Transport Sector Projects Source/Loan Amount Date of Date Name of the Project (UA mil.) Status Approval Signed ADB ADF TAF
1. Leribe-Oxbow/Roma 25/03/75 07/05/75 - - 0.83 Completed Semongkong Roads Study
2. Leribe-Butha Buthe Joel’s 20/01/77 15/11/77 - 6.17 - Completed Drift Road
3. i) New Maseru Airport I 28/08/79 08/10/79 8.00 - - Completed (Original) ii) Supplementary 14/12/84 13/01/85 12.04 - - Completed
4. Joel’s Drift-Khamane Road 28/02/80 13/06/80 - 5.62 - Completed
5. Road Maintenance Project 21/01/84 13/03/84 - 8.06 - Completed
6. Feeder Roads Study (TAF) 14/03/84 09/05/84 - - 0.90 Completed
7. Masinokeng- Mafeteng/Roma Roads 15/11/84 11/12/84 - 6.45 - Completed Rehabilitation
8. Khamane-Oxbow Road 18/06/86 16/07/86 - 6.42 - Completed
9. i) Oxbow-Mokhotlong 18/01/88 30/05/89 - 17.17 - Completed Road (Original) ii) Supplementary 01/12/92 13/05/93 - 2.86 - Completed
10. Institutional Support to the 22/05/89 30/05/89 - 2.60 - Completed Transport Sector
11. Two Rural Roads Study 22/09/99 - - - 1.22 On-going
20.04 55.35 2.95 Total ANNEX 2 LESOTHO: OXBOW – MOKHOTLONG ROAD: PROJECT COMPLETION REPORT: PROJECT LOCATION MAP
Libono
Khamane Project Road Butha-Buthe Oxbow RSA Leribe BUTHA- Maputsoe LERIBE BUTHE Peka Pitseng
Mapoteng MOKHOTLONG Teyateyaneng BEREA Ilokoeng Mokhotlong Maseru
Mazenod Roma Likafaneng MASERU Thaba-Tseka Monja Matsieng THABA-TSEKA
Sehonghong MAFETENG G Semonkong RSA Mafeteng Sehlabatheba
QACHA’S NEK MOHALE’S HOEK Sekake
Qacha’s Nek Mohale’s Hoek RSA
Mount Moetosi International boundary
QUTHING District boundary
Quthing National capital
District capital
Railroad
Road
Kilometers
Miles
This map has been drawn by the African Development Bank Group exclusively for the use of the readers of the report to which it is attached. The names used and the borders shown do not imply on the part of the Bank and its members any judgement concerning the legal status of a territory nor any approval or acceptance of these borders. Annex 3 LESOTHO Oxbow-Mokhotlong Road: Project Completion Report
List of Documents Consulted
1. Appraisal Report – Oxbow-Mokhotlong Road Project (LES/PTTR/87/01), November 1987. 2. Appraisal Report – Oxbow-Mokhotlong Road Project (ADF/BD/WP/92/129), October 1992.
3. Minutes of Loan Negotiations
4. Loan Agreements (Original Loan and Supplementary Loan) between the Government of the Kingdom of Lesotho and the African Development Bank.
5. Borrower’s Project Completion Report.
6. Monthly and Quarterly Progress Reports for the Project.
7. Pavement Maintenance and Management System (PMMS) – VOC Calibration for Lesotho, 1999.
8. Maloti-Drakensberg Transfrontier Project – Economic Assessment and Developmemt Planning (Task 5) Final Report, December 1999.
9. Feasibility and Preliminary Design Study for the Proposed Bridge Over Senqu River and 44 Kilometers of Approach Roads (December 1999)
10. Feasibility Study of Trans-Maluti Highway, November 1997.
11. Road Rehabilitation and Maintenance Project (RRMP) – World Bank Staff Appraisal Report, April 1996.
12. Organisation Charts of Ministry of Works and Roads Branch.
13. Archives of Financial Data and Correspondences available in the Bank. Disbursement data, Back-to-Office Reports, Internal memoranda, Correspondence exchanged with the Borrower and the Executing Agency, etc.
14. Correspondence Archives and Available Financial and other documents at the Ministry of Transport and Public Works.
Annex 4 LESOTHO
Project Completion Report: Oxbow-Mokhotlong Road Project
Loan Conditions
Original Loan
A. Conditions Precedent to First Disbursement
Prior to first disbursement the borrower shall: i) give an undertaking to the Fund that it will regularly make adequate allocation in the annual budget to meet its share of the project costs as set out in the financing plan; ii) give an undertaking to the Fund that it will assume responsibility to meet all cost overruns of the project together with any short fall in the financing plan that may arise; iii) give an undertaking to the Fund not to use the proceeds of the loan for payment of the various taxes and duties relating to goods and services required for the execution of the project; iv) assign a suitably qualified and experienced engineer at the Roads Branch to be the Project Co-ordinator; and v) furnish the ADF with satisfactory evidence that the complementary financing for the project has been secured and will be available for the timely execution and completion of the project. B. Other Conditions The Borrower shall: i) make adequate budgetary allocations for the proper and timely maintenance of the entire road network including the project road upon completion of construction works; and ii) submit to the Fund not later than 31st December 1988 a manpower development programme for the Roads Branch.
Supplementary Loan
A. Conditions Precedent to the Entry into Force
Prior to entry into force, the Borrower shall have: i) given evidence satisfactory to the Fund that complementary financing in respect of Lot 1 additional works has been secured and is available for the execution of works; ii) given evidence to have recruited technical assistance experts to assist the co-ordination of the project implementation and have assigned from the Ministry of Works two qualified engineers with qualifications and experience acceptable to the Fund as counterparts to the technical assistance experts; and iii) submitted to the Fund for comments, the measures taken to ensure that the counterpart engineers assigned to the project will stay on the job for at least five years.
B. Other Conditions
The Borrower shall: i) within two years of signing the loan agreement establish a dedicated fund to which existing and future road user revenues of at least M 25 million shall be allocated for the exclusive financing of road maintenance and construction works; and ii) take adequate measures for the protection of the environment and, in particular, ensure that: (a) a comprehensive rehabilitation programme be built in the Contract; and (b) the supervision consultant monitors the environmental aspects during construction in close co- operation with the Department of Environment. Annex 5 LESOTHO: PCR:OXBOW-MOKHOTLONG ROAD PROJECT IMPLEMENTATION SCHEDULE Year 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Activity 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 Board Presentation (Appraisal)
Appointment of Consultant (Appraisal) Appointment of Consultant (Actual)
Consultant Service Period (Appraisal) Consultant Service Period (Actual)
Appointment of TA Consultant (Appraisal) Appointment of TA Consultant (Actual)
TA Consultant Service Period (Appraisal) TA Consultant Service Period (Actual)
Appointment of Contractor (Appraisal) Appointment of Contractor (Actual)
Construction Period (Appraisal) Construction Period (Actual)
Maintenance Period (Appraisal) Maintenance Period (Actual) Annex 6
LESOTHO
Project Completion Report: Oxbow-Mokhotlong Road Project
Details of Annual Disbursements (UA million) Year Amount Disbursed ADF GOL Total 1989 - 0.08 0.08 1990 0.22 0.01 0.23 1991 0.13 0.07 0.20 1992 0.08 0.03 0.11 1993 4.05 0.21 4.26 1994 4.57 0.34 4.91 1995 4.25 0.21 4.46 1996 4.79 2.14 6.93 1997 1.43 0.66 2.09 1998 0.35 0.15 0.50 1999 0.13 0.05 0.18 Total 20.00 3.96 23.96
______Source: Ministry of Works, Lesotho and ADB PCR Mission, January 2000.
Annex 7/1 LESOTHO
Project Completion Report: Oxbow-Mokhotlong Road Project
Performance Rating Implementation Performance
Score Component Indicators Remarks (1 to 4) 1. Adherence to Time Schedule 1 The project was delayed by about 5 years as compared to the appraisal schedule 2. Adherence to Cost Schedule 1 More than 50% increase in project cost as compared to the appraisal estimates which necessitated substantial supplementary financing from the donors. The actual cost exceeded even reappraisal estimate by about 20%. 3. Compliance with Covenants 2 All the major loan conditions were fulfilled. 4. Adequacy of Monitoring & 2 Submission of progress reports Evaluation and Reporting was timely. 5. Satisfactory Operations (if NR Not Relevant applicable) Total 6 Overall Assessment 1.5 Unsatisfactory
Bank Performance
Score Component Indicators Remarks (1 to 4) 1. At Identification NR The project was identified as part of Lesotho National Transport Study (1973/74) and the Bank was not involved at this stage. 2. At Preparation of Project NR World Bank financed the feasibility and detailed design studies for the project. 3. At Appraisal 2 During project appraisal aspects like updating of design and construction costs were not adequately addressed. 4. At Supervision 3 On the average, one supervision mission per year Overall Assessment 2.5 Satisfactory
Annex 7/2 Project Outcome S. Score # Component Indicators (1 to 4) Remarks
1. Relevance and Achievement of Objectives 2.43 Satisfactory 1.1 Macro-economic Policy 3 Supports the macro-economic policy to i) generate domestic employment opportunities, ii) increase in productivity of agriculture & rural sector, etc. 1.2 Sector Policy 3 This project is in line with the sector policy of improving roads to and within the country’s eastern mountains so as to develop their economic potential and facilitate political and administrative integration 1.3 Physical Output 2 Final output on Lot 2 is satisfactory 1.4 Financial 1 The actual project cost is 60% higher than the appraisal estimate 1.5 Poverty Alleviation, Social/ Gender 3 Provided all weather road access to medical, educational and trade centres. Enhanced employment opportunities to rural poor, especially women 1.6 Environment 2 Though this project has no adverse affect on environment, the planned environmental mitigation measures were not implemented. 1.7 Private Sector Development 3 Better transport facility induced reopening of mines in the project area. Also plans are underway to develop tourist spots. 1.8 Other (Specify) NR 2. Institutional Development (ID) 3 2.1 Institutional Framework including restructuring NR Not one of the project objectives 2.2 Financial and Management Information NR Not one of the project objectives Systems including Audit Systems 2.3 Transfer of Technology 3 Officers of the Roads Branch were greatly benefited by the technical assistance provided under the project. In fact two engineers attached to the TA were promoted. 2.4 Staffing by qualified persons (including 3 A part from the Project Co-ordinator, the three turnover), training and counterpart staff engineers attached to the TA were training in project monitoring and contract administration 3. Sustainability 2.71 3.1 Continued Borrower Commitment 3 To ensure sustainable road maintenance, a dedicated Road Fund is in place. 3.2 Environmental Policy 3 A comprehensive National Environmental Policy is place. The GOL is initiating necessary measures to institute the remedial actions on this project. 3.3 Institutional Framework 2 One of the objectives of the on-going RRMP being funded by the World Bank is Restructuring of Ministry of Transport and Public Works. Relevant studies are underway to arrive at an appropriate organisational structure 3.4 Technical Viability and Staffing 2 Due to unattractive working environment, the staff turnover is rather high 3.5 Financial Viability including cost recovery 3 The Road Fund is introducing adequate mechanism to systems recover costs from road users 3.6 Economic Viability NR 3.7 Environmental Viability 3 The project is environmentally viable 3.8 O&M facilitation (availability of recurrent 3 With the Road Fund in place, availability of adequate funding, foreign exchange, etc.) funs for road maintenance is ensured 4. Economic Internal Rate of Return 2 The anticipated traffic growth has not materialised. Total 10.14 Overall Assessment of Outcome 2.53 Satisfactory Annex 8 LESOTHO PROJECT COMPLETION REPORT: OXBOW-MOKHOTLONG ROAD Road Condition Matrix (Summary of Pavement Evaluation) Link From To Length ADT No. of Visual Condition Roughness Rut Overall Pavement # (Km) 1999 Potholes Surface Shoulder Side Index (mm/km) (mm) Index Type drains Lot 1: Oxbow - Mapholaneng A1-30 Oxbow Mothae 34.9 30 Fair Good Good 69 3.45 9.1 59 Chip Seal A1-31 Mothae Letseng 9.8 2 Good V. Good Good 66 3.50 10.3 58 Chip Seal A1-32 Letseng Masoleng 15.0 25 Fair Good Good 68 3.20 9.9 60 Chip (12km)/ Slurry (3km) Seal A1-33 Masoleng Mapholaneng 12.0 15 Fair Good Fair 71 3.31 10.0 61 Slurry Seal Lot 1: Overall 71.7 72 Fair Good Good 69 3.40 9.8 59 Chip (56km)/ Slurry (16km) Seal Lot 2: Mapholaneng - Mokhotlong A1-34 Mapholaneng Ha-Ntese- 1.6 1 Good V. Good Good 80 3.02 11.3 67 Slurry Seal Seyane A1-35 Ha-Ntese- Tlokeng 3.5 7 Fair V. Good Fair 74 2.71 7.8 69 Slurry Seal Seyane A1-36 Tlokeng Thabang 25.1 19 Fair Good Fair 75 3.16 9.0 64 Chip (13km)/ Slurry (9km) Seal A1-37 Thabang Mokhotlong 8.0 17 Fair V. Good Fair 72 2.96 9.4 64 Chip Seal Lot 2: Overall 38.2 44 Fair V. Good Fair 75 2.96 9.4 66 Chip (24km) /Slurry (14km) Seal Lot 1+Lot 2: Overall 109.9 116 Fair Good Fair 72 3.20 9.6 63 Chip (80km)/ Slurry (30km) Seal Annex 9 Lesotho: Oxbow-Mokhotlong Road : Project Completion Report Roads Branch - Organization Chart
Chief Roads Engineer
Principal Roads Engineer
Finance Maintenance & Design & Projects & Administration Materials Planning
Controller SRE - (M&A) SRE - Design SRE - P & P
Accountants/Staff Admn. RE South RE Central RE North RE RCU RE Material Project Engineers Planning Engineer Region (NR) (Three)
Mechanical RE Exec. ARE Material RE (Twin) RE (Twin) RE (Twin) PTO RCU Assistant Staff RIU Carpentry Registry, etc. PTOs Precasting Personnel Similar to NR Similar to NR PTO Exec. Officer Staff Manager
Signs Training Material Staff Office Manager Leribe Depot Mechanical Materials Lab. Staff Three Depots Regional Clerk Stores Security Stores similar to Leribe
Yard Section Radio Ops. Design Staff Office and STO TO Mech. Site Clerks Registry, etc. Ancillary Staff
Survey Satff Planning Manager Staff Operators/Drivers ------Technicians
Site Staff and Labour Annex 10
LESOTHO Project Completion Report: Oxbow-Mokhotlong Road Project
Vehicle Operating Costs (VOC) - Economic Vehicle Class VOC (Maloti/km) VOC savings Existing Road Proposed Road per vkm (Maloti 1987 Scenario Car 0.95 0.46 0.49 LGV 0.85 0.42 0.43 Truck 2.23 1.10 1.13 Bus 2.32 1.14 1.18
1999 Scenario Car 1.11 0.39 0.72 LGV 3.05 1.44 1.61 Truck 4.54 1.70 2.84 Bus 3.96 1.96 2.00 Source: Ministry of Transport and Public Works, ADB PCR Mission 2000, and Appraisal Report, 1987.
Updated Traffic Forecasts (ADT)
Year Maphalaneng - Oxbow-Mokhotlong Mokhotlong (Entire Road) (Lot 2) 1996 241 213 1997 280 248 1998 309 273 1999 294 260 2000 314 278 2005 438 388 2010 609 539 2015 849 751 2017 969 857 Source: Ministry of Works and ADB PCR Mission January 2000. Annex 11
Annex 11/1 Lesotho Project Completion Report: Oxbow-Mokhotlong Road Economic Evaluation Million Maloti - 1999 Price Level) Oxbow-Mokhotlong Road (Entire Section)
Year Capital Savings Total Net Cost Maintenance VOC Savings Savings 1989 1.39 0 -1.39 1990 3.99 0 -3.99 1991 3.47 0 -3.47 1992 1.91 0 -1.91 1993 73.97 0 -73.97 1994 85.25 0 -85.25 1995 77.44 0 -77.44 1996 120.33 0 -120.33 1997 36.29 0 -36.29 1998 8.68 0.10 18.60 18.70 10.02 1999 3.13 0.10 19.87 19.98 16.85 2000 0.10 21.23 21.34 21.34 2001 0.10 22.69 22.79 22.79 2002 0.10 24.24 24.35 24.35 2003 0.10 25.90 26.01 26.01 2004 -0.24 27.68 27.43 27.43 2005 0.10 29.57 29.68 29.68 2006 0.10 31.60 31.70 31.70 2007 0.10 33.76 33.87 33.87 2008 0.10 36.07 36.18 36.18 2009 0.10 38.55 38.65 38.65 2010 0.10 41.19 41.29 41.29 2011 -0.24 44.01 43.76 43.76 2012 0.10 47.02 47.13 47.13 2013 0.10 50.24 50.35 50.35 2014 0.10 53.68 53.79 53.79 2015 0.10 57.36 57.47 57.47 2016 0.10 61.29 61.40 61.40 2017 -195.695 0.10 65.49 65.59 261.29
Economic Internal Rate of Return (EIRR) 5.49% Annex 11/2 Lesotho Project Completion Report: Oxbow-Mokhotlong Road Economic Evaluation Million Maloti - 1999 Price Level) Maphalenong-Mokhotlong Section (Lot 2)
Year Capital Savings Total Net Cost Savings Savings Maintenance VOC 1989 0.49 0.00 -0.49 1990 1.42 0.00 -1.42 1991 1.23 0.00 -1.23 1992 0.68 0.00 -0.68 1993 26.23 0.00 -26.23 1994 30.23 0.00 -30.23 1995 27.46 0.00 -27.46 1996 42.67 0.00 -42.67 1997 12.87 0.00 -12.87 1998 3.08 0.04 6.33 6.37 3.29 1999 1.11 0.04 6.77 6.80 5.70 2000 0.04 7.23 7.27 7.27 2001 0.04 7.73 7.76 7.76 2002 0.04 8.26 8.29 8.29 2003 0.04 8.82 8.86 8.86 2004 -0.08 9.43 9.34 9.34 2005 0.04 10.07 10.11 10.11 2006 0.04 10.76 10.80 10.80 2007 0.04 11.50 11.53 11.53 2008 0.04 12.29 12.32 12.32 2009 0.04 13.13 13.16 13.16 2010 0.04 14.03 14.06 14.06 2011 -0.08 14.99 14.90 14.90 2012 0.04 16.01 16.05 16.05 2013 0.04 17.11 17.15 17.15 2014 0.04 18.28 18.32 18.32 2015 0.04 19.54 19.57 19.57 2016 0.04 20.87 20.91 20.91 2017 -69.40 0.04 22.30 22.34 91.74
Economic Internal Rate of Return (EIRR) 5.24%
Source: PCR Mission, January 2000