AFRICAN DEVELOPMENT BANK GROUP

TANZANIA: TANZAM HIGHWAY REHABILITATION

Project Performance Evaluation Report (PPER)

OPERATIONS EVALUATION DEPARTMENT (OPEV)

8 March 2004

TABLE OF CONTENTS Page No.

Currency Equivalents i Acronyms and Abbreviations i Preface ii Basic Project Data iii Executive Summary vi Summary of Ratings ix

1. THE PROJECT 1 1.1 Country and Sector Economic Context 1 1.2 Project Formulation 2 1.3 Project Objectives and Scope at Appraisal 2 1.4 Financing Arrangements - Bank Group and others 3

2. EVALUATION 4 2.1 Evaluation Methodology and Approach 4 2.2 Performance Indicators 4

3. IMPLEMENTATION PERFORMANCE 5 3.1 Loan Effectiveness, Start-up and Implementation 5 3.2 Adherence to Project Costs, Disbursements & Financing Arrangements 6 3.3 Project Management, Reporting, Monitoring and Evaluation Achievements 6

4. PERFORMANCE EVALUATION AND RATINGS 7 4.1 Relevance of Objectives and Quality at Entry 7 4.2 Achievement of Objectives and Outputs. "Efficacy" 8 4.3 Efficiency 9 4.4 Institutional Development Impact 9 4.5 Sustainability 12 4.6 Aggregate Performance Rating 13 4.7 Performance of the Borrower 13 4.8 Bank Performance 13 4.9 Factors affecting Implementation Performance and Outcome 13

5. ECONOMIC INTEGRATION AND REGIONAL CO-OPERATION 14 5.1 Background 14 5.2 Regional Goals at Appraisal 14 5.3 Achievements 14

6. CONCLUSIONS, LESSONS LEARNT AND RECOMMENDATIONS 17 6.1 Conclusions 17 6.2 Lessons learnt 17 6.3 Recommendations 17

TABLES

Table 1: Main Aggregates of the Transport and Communications Sector 1 Table 2: Sources of finances Of the Sixth Highway Rehabilitation Project 3 Table 3: Source of funding of ADF Components 4 Table 4: TZS Trend of inflation and exchange rates 6 Table 5: FY 2001/02 Maintenance Budget 13 Table 6: Tanzania Trade Profile with PTA Countries (Million TZS) 15

BOXES

Box 1: TANROADS Commitment 8 Box 2: East African Co-operation Development Strategy 1997-2000 16

ANNEXES Number of pages

Annex 1 Retrospective Logical Framework 1 Annex 2 Selected macro-economic Indicators 1 Annex 3 Evaluation Criteria 2 Annex 4 Borrower Performance 1 Annex 5 Bank Performance 1 Annex 6 Factors affecting Implementation Performance and Outcome 2 Annex 7 Recommendations and follow-up matrix 1

______The Project Performance Evaluation Report was prepared by Mr. A. B. SEMANOU, Consultant, following his mission to Tanzania in November 2002. Further enquiries should be addressed to Mr. G. M. B. KARIISA, Director, Operations Evaluation Department, on extension 4052 or Ms. Z. KHORSI, Principal Evaluation Officer on extension 4338

CURRENCY AND MEASURES

Currency Equivalents

Currency Unit = Tanzania shilling (TZS)

At Appraisal At Completion At Post-evaluation UA= 18.25 1106.64 1282.28 TZS

WEIGHTS AND MEASURES

1 metric tonne (t) = 2,205 lbs. 1 kilogram (kg) = 2.205 lbs. 1 metre (m) = 3.281 ft 1 foot (ft) = 0.305 m 1 kilometre (km) = 0.621 mile 1 square kilometre (km2) = 0.386square mile 1 hectare (ha) = 0.01 km2 = 2.471 acres

FISCAL YEAR

July 1 - June 30

LIST OF ABBREVIATIONS

ADT = Average Daily Traffic ADB = African Development Bank ADF = African Development Fund BOT = Bank of Tanzania DANIDA = Danish International Development Agency EAC = East African Community ERR = Economic Rate of Return FINNIDA = Finish International Co-operation Agency GDP = Gross Domestic Product GOT = Government of Tanzania IDA = International Development Association (World Bank) MOW = Ministry of Works NORAD = Norwegian Agency for Development PTA = Preferable Trade Arrangement SADC = Southern African Development Community TANLAB = Tanzania Roads Agency Laboratory TANROADS = Tanzania Roads Agency TAZARA = Tanzania-Zambia Railway Authority TRL = Transport Research Laboratory TZS = Tanzania Shillings UA = Bank Unit of Account VOC = Vehicle Operating Costs

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PREFACE

1. This Project Performance Evaluation Report (PPER) is on the performance of the Tanzam Highway Rehabilitation Project in Tanzania.

2. In November 1987, ADF Loan N° TZ/TR(RD)87/16 in the amount of UA 17.68 million was approved for the Project.

3. The Tanzam Highway Rehabilitation Project was formulated as a component of the overall Sixth Highway Rehabilitation Project of the World Bank; at appraisal, the co- financiers were IDA, DANIDA, NORAD and ADF.

4. ADF financed Sections 1 and 3 of the Tanzam Highway Rehabilitation as well as the related consultancy services.

5. The objectives of the project, among others, were to rehabilitate deteriorated sections of the Tanzam Highway and high priority sections of the country's gravel road network serving the most productive agricultural areas and strengthen the activities of the MOW.

6. The Project was completed and a Project Completion Mission was conducted in November 1999 and the Project Completion Report (PCR) was finalised in January 2002. The PCR provided adequate assessment of the implementation experience and the overall performance of the project.

7. The evaluation report is the result of a post evaluation mission undertaken in November 2002. The information contained herein is based on discussions with Tanzania Government officials, a visit to the project site, information from the appraisal, Borrower and Bank PCR reports as well as from project documents and Bank files. This Project Performance Evaluation Report (PPER) was prepared in order to highlight the overall performance of the Road, and its contribution to enhancing trade and communication with neighbouring countries. This PPER will also serve as an input to the Study on Contribution of Infrastructure Development to Economic Integration and Regional Co-operation to be undertaken by the Bank in 2003.

8. The overall assessment in both the Bank PCR and this PPER shows an unsatisfactory project performance outcome.

9. The draft of this report was submitted for comments to both the Operational Departments of the Bank and to the Borrower and their comments were taken into account in the final version of the report or attached as annex to this report.

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BASIC PROJECT DATA

1. Country : Tanzania 2. Project Title : Tanzam Highway Rehabilitation Project 3. Loan Number : TZ/TR(RD)87/16 4. Borrower : United Republic of Tanzania. 5. Beneficiary : Ministry of Works 5. Executing Agency : Ministry of Works

A. THE LOAN APPRAISAL ESTIMATE ACTUAL

1. Amount (UA Million): 17.68 17.67 2. Loan Approval Date: - February 1987 3. Loan Signature Date - November 1987 4. Date of Entry into Force: May 1988 March 1989

B PROJECT DATA

1. Financing Plan

UA Million Source Appraisal Estimate Actual FE LC Total % FE LC Total % ADF 17.68 0 17.68 75.4 17.67 0 17.67 83.5 GOT 0 5.76 5.76 24.6 0 3.49 3.49 16.5 Total 17.68 5.76 23.44 100 17.67 3.49 21.16 100

Estimate Actual 2. Date of First Disbursement June 1987 December 1989 3. Date of Last Disbursement December 1992 August 1998

C. IMPLEMENTATION PERFORMANCE INDICATORS

Cost Overrun 54% (Necessitating reduction of scope of works) Time Overrun

Slippage on Effectiveness 9 months

Slippage on Completion Date: 50 months

Slippage on Last Disbursement. 68 months

Number of Extensions of Last Disbursement: 2

Project Implementation Status Completed

D. MISSIONS

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Number of Activity Period Persons Composition Man/Day 1. Appraisal 01/86 2 Engineer/ 28 Economist 2. Supervision 10/89 2 Engineer/Economi 28 st 2/90 2 Engineer/Economi 28 st 03/91 3 Engineer/Economi 54 st/Financial Analyst 06/92 3 Engineer/Economi 30 st/External Bureau 01/93 7 Engineer 80 Economist Deputy Director Director Country Programme Officer 2 Legal Officers . 11/93 1 Director 7 01/94 1 Engineer 7 01/95 2 Division Chief 20 Engineer 11/95 2 Economist 28 Engineer 10/96 1 Engineer 11 3. PCR 11/99 2 Engineer 14 Economist 4. PPER 11/02 1 Engineer 11

E. DISBURSEMENTS

Appraisal % Estimate Actual Disbursed

1. Total disbursed (UA million) 17.68 17.67 99.94 2. Unused balance (UA million) 0 0.01 0.06

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Bank Group Financed Projects in Tanzania : As at 11/07/2002 : (UA) STATUS Operations Completed On-going SECTOR Instrument Nb. Loan Approved Nb. Disbursed Nb. Disbursed Agriculture & Rural Development PL 13 124,103,081 9 80,279,427 4 43,823,654 TA 2 998,789 1 506,026 1 492,763 GA 3 1,866,009 3 1,866,009 Total 18 126,967,879 10 80,785,453 8 46,182,426 Industry, Mining & Quarries PL 2 3,279,500 2 3,279,500 SA 1 27,631,560 1 27,631,560 0 0 GA 1 702,394 1 702,394 Total 4 31,613,454 1 27,631,560 3 3,981,894 Transport PL 13 195,005,195 10 112,355,195 3 82,650,000 SI 1 9,750,000 1 9,750,000 GA 4 8,612,626 2 6,078,943 2 2,533,683 Total 18 213,367,821 12 118,434,138 6 94,933,683 Water & Sewerage PL 6 69,017,621 5 32,077,621 1 36,940,000 TA 2 1,197,367 2 1,197,367 0 0 GI 1 1,310,000 1 1,310,000 GA 3 3,320,789 1 690,789 2 2,630,000 Total 12 74,845,777 8 33,965,777 4 40,880,000 Energy PL 5 62,217,072 3 33,190,772 2 29,026,300 GA 3 5,870,000 1 2,500,000 2 3,370,000 Total 8 68,087,072 4 35,690,772 4 32,396,300 Communication PL 3 32,611,827 3 32,611,827 0 0 Total 3 32,611,827 3 32,611,827 0 0 Finance LC 3 9,500,000 2 4,500,000 1 5,000,000 Total 3 9,500,000 2 4,500,000 1 5,000,000 Social PL 5 55,007,364 1 6,447,364 4 48,560,000 GI 1 1,010,000 1 1,010,000 GA 4 3,903,420 2 1,243,420 2 2,660,000 Total 10 59,920,784 3 7,690,784 7 52,230,000 Multisector PL 1 5,910,000 1 5,910,000 SI 1 28,552,612 1 28,552,612 0 0 SL 3 112,631,560 3 112,631,560 GA 1 736,842 1 736,842 FM 2 1,170,000 2 1,170,000 Total 8 149,001,014 1 28,552,612 7 120,448,402 Total PL 48 547,151,660 31 296,962,206 17 250,189,454 LC 3 9,500,000 2 4,500,000 1 5,000,000 SI 2 38,302,612 1 28,552,612 1 9,750,000 SL 3 112,631,560 3 112,631,560 SA 1 27,631,560 1 27,631,560 0 0 TA 4 2,196,156 3 1,703,393 1 492,763 GI 2 2,320,000 2 2,320,000 GA 19 25,012,080 6 10,513,152 13 14,498,928 FM 2 1,170,000 2 1,170,000 Total 84 765,915,628 44 369,862,923 40 396,052,705 Source : OPEV – SAP Subtract PL : Loan LC : Line of Credit SI : Sectoral Investment or Rehabilitation Loan SL : Structural Adjustment Loan SA : Sectoral Adjustment Loan TI : Institutional Support and Rehabilitation Loan TA : Project Cycle Loan GI : Institutional Support and Rehabilitation Grant GA : Project Cycle Grant

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EXECUTIVE SUMMARY

1. THE PROJECT

1.1 In Tanzania, the transport sector is estimated to contribute 5.4% of GDP with the road transport sub-sector contributing 2.5%. The importance of the transport sector is not limited to its direct contribution to the GDP but it also enables other sectors (agriculture, mining and tourism) to generate value added. Also Tanzania serves as a transit corridor to the landlocked countries of Rwanda and Burundi and to a lesser extent Uganda, Zambia and the Democratic Republic of Congo (DRC).

1.2 The Tanzam Highway is one of the active corridors contributing to GDP growth of Tanzania and facilitating export/import cargo for neighbouring landlocked countries. Under the three-year structural adjustment programme formulated in 1982, the Government of Tanzania (GOT) commissioned a feasibility study on the Tanzam Highway in order to identify sections showing signs of failure and recommend measures to rehabilitate and strengthen the entire road. The study was also to prepare a maintenance programme for the road.

1.3 The World Bank appraised the Tanzam Highway Project for IDA financing as a component of the overall Sixth Highway Rehabilitation Project. Other funding agencies were DANIDA, NORAD, and ADF.

1.4 In January 1986, an ADB mission recommended and appraised Sections1 and 3 of the road. The project components comprised rehabilitation of a total of 129.9 km and related consultancy services to supervise of the construction works.

1.5 The sectoral objective of the project was to support the Government transport programme which overall consisted of rehabilitating the existing road network in order to reduce road transport cost, and provide support to the trucking industry in order to meet existing and future demands for the movement of agricultural products and associated inputs. Long term economic co-operation between Zambia and Tanzania was also envisaged by developing Zambia-Dar es Salaam transport routes.

1.6 The project as implemented was limited to a total of 77.90km including (i) 44.45km of Section 1 from Mlandizi (km 58.3) to Chalinze (km 102.75), and (ii) 33.45km of Section 3 from Mikumi (km 304.200) to Ruaha (km 337.650). The reduction in the scope of works was mainly due to (a) long delays in the implementation of the project leading to further extensive deterioration of the road and (b) inadequate materials investigation.

1.7 At Appraisal, the cost of the ADF funded Sections 1 and 3 were estimated at UA million 23.44, of which UA 17.68 million foreign exchange and UA 5.76 million local currency. At the Completion of the project, ADF had disbursed a total of UA 17.67 million against the GOT contribution of UA 3.49 million local currency.

1.8 Loan processing experienced long delays. The project was appraised in January 1986; the loan was approved in February 1987, a little over the year. The delay in approving the loan was partly due to sanctions imposed on Tanzania because of arrears on loan repayments. The loan became effective in March 1989, some three years after appraisal. In the mean time, the road continued to deteriorate, increasing the scope of works.

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1.9 During rehabilitation, construction works on Section 1 showed premature failure and consequently works had to be stopped for independent investigations carried out by GOT. The outcome of the investigations was that quarries were inadequate. Works resumed according to the proposed corrective measures after the conclusion of the investigations.

1.10 The national budget could not allocate enough funds to settle the payments in local currency because of depreciation of TZS and high inflation during the implementation of the project.

2. THE EVALUATION

2.1 The evaluation exercise was carried out through (i) review of documents at the Bank, (ii) interview of Project Staff within the Bank, (iii) site visits and inspection of the entire road, (iv) consultations with GOT Officials, and (v) interviews of other stakeholders.

2.2 During the appraisal of the project, performance indicators were not systematically established. Nevertheless, the Appraisal Report and the PCR provided some key factors to help assess the performance of the project. Retrospective Logical Framework was prepared in conjunction with the one prepared during PCR exercise.

3. EVALUATION CONCLUSIONS AND RATINGS

3.1 Relevance of Objectives and quality at entry was rated satisfactory (3.60). The project was well designed and well prepared. The project attracted bilateral and multilateral donors due to the quality of the preparation. The overall performance was rated unsatisfactory (2.68). Shortcomings were registered in the Achievement of Objectives and Outcomes, Efficiency, Institutional Development Impact, and Sustainability. The project was resilient to exogenous factors (Zambia Export/Import and weather conditions). Borrower's continued commitment was hampered by lack of adequate maintenance financing. The project's objectives and outputs are unsustainable without Donors assistance for maintenance.

3.2 Borrower's performance was unsatisfactory (2.77). Shortcomings were registered in (i) counterpart financing, (ii) mid-course adjustments, and (iii) adherence to time schedule and costs. The Performance of the Bank was unsatisfactory (2.83). The Bank supervision missions failed to detect likely social development impact and sustainability issues.

4. LESSONS AND RECOMMENDATIONS

4.1 Lessons

• Delays in loan processing and implementation activities had adverse impact on the project resulted in further road deterioration.

• For such rehabilitation projects, physical contingencies can be unpredictable,

• In a structural adjustment environment, price contingencies can also be unpredictable.

• Inadequate construction materials had impacted negatively on the implementation of the project in terms of cost overruns and delays. Due to premature failure, works on Section 1 were stopped for investigations for two years.

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• Strong commitment and political will were necessary in achieving regional co-operation goals.

4.2 Recommendations

• Duration of engineering studies, project appraisal, tender award and start-up of works should take place within a set time limit. The Borrower recommended a minimum of six months. (Ref. par 3.1.2, 3.1.3, 4.2.1, and Borrower's PCR.).

• Mid-term review should be conducted especially for project experiencing long delays and substantial changes in the scope of works, if necessary (Ref. par. 4.2.1 and Bank PCR).

• Detailed investigation into sources of construction material should always be undertaken as part of engineering study and adequate funding must be allocated thereof. (Ref. par 3.1.5 and Borrower's PCR).

• Commitment and strong political will indicators need to be designed within an Economic Integration and Regional Co-operation Aggregate Index (Ref. par. 5.3.1).

5. FEEDBACK

The findings of the PPER will be taken into account as inputs into thematic/special evaluation studies and future regional road projects.

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SUMMARY OF RATINGS

Relevance of Objectives and Quality at Entry Satisfactory Achievements of Objectives and Outputs Unsatisfactory Efficiency Unsatisfactory Institutional Development Impact Unsatisfactory Sustainability Unsatisfactory Aggregate Performance Rating Unsatisfactory Borrower's Performance Unsatisfactory Bank Performance Unsatisfactory

1. THE PROJECT

1.1 Country and Sector Economic Context

1.1.1 The economic structure of Tanzania is characterised by the dominance of the agricultural sector. Over the years, the percentage share of agriculture in the total GDP at factor cost varies between 50.6 in 1996 and 48.2 in 2000. About 80% of the population live in the rural areas. Transport and Communication Sector is the main facilitator of the Agricultural sector.

1.1.2 In Tanzania, the transport sector is estimated to contribute for 5.4% of GDP with the road transport sub-sector contributing 2.5%. It also accounts for between 15% to 21% of the country’s foreign exchange earnings. The importance of the transport sector is not limited to its direct contribution to the GDP but it also enables other sectors (agriculture, mining and tourism) to generate value added. Tanzania, also, serves as a transit corridor for the landlocked countries of Rwanda and Burundi and to a lesser extent Uganda, Zambia and the Democratic Republic of Congo (DRC). Main Aggregates of the Transport and Communication Sector for the period 1996-2000 are shown in Table 1 below:

Table 1 Main Aggregates of the Transport and Communication Sector (Million of TZS)

1996 1997 1998 1999 2000

1 GDP at factor cost 3,452,559 4,281,600 5,125,311 6,113,361 6,663,685 2 GDP Annual Real Growth 4.2 3.3 4.0 4.7 4.9 Rate (%) 3 GDP at market prices 3,767,642 4,703,459 5,571,641 6,441,296 7,225,666 4 GNP at market prices 3,730,722 4,654,215 5,519,246 6,386,103 7,150,000 5 Per Capita GDP at factor cost 122,205 147,026 170,733 193,440 208,893 (TZS) 6 Final Consumption 3,565,401 4,381,635 5,343,036 6,11,574 6,543,253 Expenditure 7 Compensation of Employees 284,578 335,802 410,025 426,426 447,747 8 Gross fixed capital formation 620,597 692,400 892,700 989,338 1,266,678 9 Gross Capital Formation at 627,237 700,803 902,614 999,650 1,281,046 f.c. 10 Savings 270,988 284,076 299,629 343,658 802,266 11 Resource balance (10-9) (356,250 (416,727) (602,985) (662,348) (662,348) 12 National Disposable Income 3,836,389 4,692,248 5,642,664 6,462,232 7,345,536 at m. p. Source: BOT computations

1.1.3 The transport system consists of (i) a road network of about 115,000 km; (ii) two railway systems: the Tanzania Zambia Railway (TAZARA) which links Dar Es Salaam with Zambia and Tanzania Railways Corporation (TRC), which serves the central and northern regions and provides transit access to DRC, Rwanda, Burundi and Uganda; (iii) one dominant and three subsidiary ports; Dar Es Salaam, Zanzibar, Tanga and Mtwara; and (iv) a civil aviation sub-sector consisting of several small airlines, three international airports and more than 60 smaller domestic airports and air strips. The physical capacity of Tanzania’s transport system, whether ports, railways or the road system, is adequate to handle not only present but significantly higher traffic volumes. However, the facilities, particularly the roads are generally in poor condition, mainly due to inadequate maintenance. 1.1.4 Tanzania has a relatively limited classified road network of about 85,000 km of which 5% is paved. The density of this network of 96.5m/km2 (5.0m/km² for paved roads) 2

is quite low. It is much lower than in the other East African Community (EAC) member states, Kenya and Uganda, where it is respectively 261.9 m/km² (15.2 m/km² for paved roads) and 330.8m/km² (14.5m/km² for paved roads).

1.2 Project Formulation

1.2.1 The Tanzam Highway Rehabilitation Project was designed under the overall Sixth Highway Rehabilitation Project prepared by the World Bank in order to facilitate Zambia's export/import traffic needs through Dar es Salaam harbour and promote Agricultural activities in its zone of influence.

1.2.2 Feasibility study conducted on the road was completed in 1982. Detailed design study was recommended for five sections identified for immediate rehabilitation. ADF was earmarked to finance rehabilitation works on Sections 1 and 3.

1.3 Project Objectives and Scope at Appraisal

1.3.1 The objectives of the Tanzam Highway Project specified in the Appraisal Report (par. 5.1) were to (i) rehabilitate deteriorated sections of the Tanzam Highway and high priority sections of the country’s gravel road network serving the most productive Agricultural areas; (ii) revitalise the periodic maintenance and rehabilitation works by promoting local contractors, (iii) strengthen the activities of the Ministry of Works (MOW), especially the maintenance unit, by manpower capacity building, equipment, logistics and improved planning, (iv) assist the transport sector policies in order to improve the utilisation of resources, (v) support the trucking industry, and (vi) study the rehabilitation of the feeder road network and to prepare an investment plan for high priority feeder roads.

1.3.2 To achieve the above-mentioned objectives, the donor community under the leadership of the World Bank appraised the overall Sixth Highway Rehabilitation Project. The total cost of the project was estimated at UA 97.89 million. The Tanzam Highway was estimated at UA 49.41 million. ADF components were estimated at UA 23.44 million, of which UA 17.68 million foreign exchange and 5.76 local currency. ADF financing was to cover the foreign exchange requirements of sections 1 and 3. The components financed by ADF comprised rehabilitation of a total of 129.9 km as follows:

(a) 84.9 km of section1 from Dar es Salaam to Chalinze.

(b) 45.0 km of section 3 from Mikumi to Ruaha River (sub-section A), and Kitonga Gorge (sub-section B).

1.3.3 The construction period at appraisal was three years and was expected to begin in April 1987. A one-year maintenance period was to follow the construction. The comparative project implementation schedule at appraisal and completion was as follows:

Envisaged Actual 1. Shortlist of consultants July 1986 July 1987 2. Prequalification of contractors Sept.1986 Feb. 1988 3. Award of consulting contract Nov. 1986 Aug. 1989 4. Call for construction tenders Nov. 1986 Dec. 1988 5. Receipt of construction tenders Jan. 1987 April 1989 3

6. Award of construction contract: Section 1 April 1987 March 1990 Section 3 April 1987 Dec. 1991 7. Completion of construction contract Section 1 April 1990 June 1994 Section 3 April 1990 June 1994 8. Completion of maintenance period Section 1 April 1991 June 1995 Section 3 April 1991 June 1995

1.4 Financing Arrangements – Bank Group and others

1.4.1 World Bank (IDA), Norway and Government of Tanzania as shown in table 2 below financed the Project.

Table 2 Sources of Finance of the Sixth Highway Rehabilitation Project

UA million Foreign Local Total % Exchange Cost ADF 17.68 17.68 35.31 IDA 13.29 13.29 26.55 NORWAY 6.28 6.28 12.55 GOT 0.00 12.80 12.80 25.59 Total 37.25 12.80 50.05 100.00

1.4.2 The road was divided into 4 sections; ADF funding was directed to sections 1 and 3 whereas IDA and Norway funding were directed to section 2 and 4 and associated consultancy services respectively. GOT contributed the entire local cost.

1.4.3 The rehabilitation of Tanzam Sections 1 and 3 was co-financed by ADF and GOT. The ADF financed the foreign exchange requirements. The GOT financed the local costs of the project including price escalation and local construction materials and labour. The contribution of ADF and GOT towards the project cost as foreseen at appraisal and as actually expended is shown in table 3 below:

Table 3 Source of funding of ADF Components

UA Million Source Appraisal Estimate Actual FE LC Total % FE LC Total % ADF 17.68 0 17.68 75.4 17.67 0 17.67 83.5 GOT 0 5.76 5.76 24.6 0 3.49 3.49 16.5 Total 17.68 5.76 23.44 100 17.67 3.49 21.16 100 4

2. EVALUATION

2.1 Evaluation Methodology and Approach

2.1.1 A classic performance review process was used to assess the performance of the project and to validate PCRs of the Bank and the Borrower. In the first stage, project documentation (Appraisal Report, Project File, Bank’s PCR, Supervision Mission Reports, Disbursement Records, etc.) available within the Bank was reviewed. Basic documentation to be collected during field mission was identified. Project Task Manager and other Officers involved were interviewed.

2.1.2 The second stage involved a field mission to Tanzania in November 2002. Consultations were held with relevant Government officials to seek their views on the processing of the project. The entire road was visited and the views of other stakeholders were solicited.

2.1.3 It is worth mentioning that because of the lapse of time between appraisal and PPER mission, obtaining documents and meeting the relevant people involved in the project was difficult, given the numerous changes that had taken place within the MOW towards mainstreaming the management of road sub-sector.

2.1.4 The mission also collected some statistical data and reports as input for the Study on Contribution of Infrastructure Development on Economic Integration and Regional Co-operation to be undertaken by the Bank in 2003. The mission visited the Tanzania National Library, the National Bureau of Statistics and the Planning and Privatisation Division of the President’s Office.

2.1.5 Evaluation benchmarks such as Relevance, Achievements of Objectives (Efficacy), Efficiency and Institutional Development Impact and Sustainability were used to assess the Project and Stakeholders Performance. The project was also assessed using the "with and without project" approach.

2.2 Performance Indicators

2.2.1 During the appraisal of the project, performance indicators were not systematically established to assess the extent to which targets were being mat. Nevertheless, the Appraisal Report and the PCR provided some key factors to help assess the performance of the project. The Retrospective Logical Framework gives Objectively Verifiable Indicators.

2.2.2 The Appraisal Report in its sections 4.2, 4.3 and 4.4, gives information on the national and international impact of the road. The aggregate performance indicator took these elements into account.

3. IMPLEMENTATION PERFORMANCE

3.1 Loan Effectiveness, Start-up and Implementation

3.1.1 Bank PCR provides adequate review of the experience leading to loan effectiveness, start-up of the project, changes in project scope of works, implementation 5

schedule, project cost and reporting. It also covered procurement of works and services, and investigations of failure in Section 1. The project was appraised in January 1986; the loan was approved in November 1987, one year later as Tanzania was under sanction for arrears on loan repayment.

3.1.2 The Loan was signed on 30 March 1987. The Loan became effective 3rd March 1989, more than three years after appraisal. GOT was unable to give an undertaking to assume responsibility to meet all cost overruns. GOT complied with all general and other conditions except the one indicated above. GOT also did not comply with the general conditions that require the Borrower to hold separate account books for the proceeds of the Bank loan. Loan conditions were realistic and relevant.

3.1.3 Procurement of contractors for works suffered long delays. GOT did not come to agreement with the first two successful bidders, after negotiations. The third successful bidder was invited for negotiations and contract award. This was the case for both sections 1 and 3. In the meantime, extensive pavement deterioration continued requiring high additional cost, which the GOT could not raise from its resources. This led to reduction in the scope of works.

3.1.4 There were no changes in the design of the road. Horizontal and vertical alignments remained unchanged. Due to cost overruns, the scope of works was reduced to tally with funds available. At appraisal, the project envisaged rehabilitation of a total of 129.90 km. At completion, it was limited to a total of 77.90 km i.e. 59.9% of the appraisal estimate.

3.1.5 During construction, Section 1 experienced premature failure. In January 1992 the GOT commissioned the British Transport and Road Research Laboratory to carry out field investigations into the road failure and recommend remedial measures. The outcome of the investigations showed that failure was due to inappropriate materials. In January 1993, the Bank lunched a 7-man supervision mission including a Head of Department and two legal officers in order to agree on remedial actions. An independent consultant was recruited to review the Tanzam Highway Rehabilitation Project. The review consultant presented their findings to a GOT/ADB meeting in Abidjan in July 1993. Following this presentation GOT and ADB agreed to limit the scope of Sections 1 and 3 to according to the amount of loan available. Construction works were stopped from January 1992 to January 1994. The failure delayed the project by two years.

3.2 Adherence to Project Costs, Disbursements and Financing Arrangements

3.2.1 PCR reported on the reduction in the scope of the project as a result of cost overruns. During implementation period, the exchange rate of TZS against UA rose from 18.25 in 1987 to reach 1282.28 in 2002. Due to the reduction in the scope of works, the actual cost of the project amounted to UA million 17.67 for foreign exchange and TZS million 1,850.43 against UA million 17.68 and TZS million 103.79 at appraisal. The actual cost showed the burden of the project on the Borrower's counterpart funds.

3.2.2 GOT failed to secure counterpart funds for the project. During implementation period, Tanzania economy experienced a 2-digit inflation rate, which had negative impact on local currency part of contracts. Devaluation of TZS also negatively impacted on price escalation. Table 4 shows trend of inflation and exchange rates.

Table 4 6

TZS Trend of Inflation and Exchange Rates

Rates Year Inflation Exchange 1991 28.8 307.505 1992 21.9 478.675 1993 25.2 652.707 1994 33.1 752.417 1995 28.4 924.579 1996 21.0 863.529 1997 16.1 851.162 1998 12.8 950.833 1999 7.9 1106.64 2000 5.9 1037.17 2001 4.0* 1147.22 Source: BOT & ADB Historical Rates

3.2.3 Loan disbursement suffered delays. The first disbursement was made in 1989 instead of 1986 as envisaged at appraisal. The actual last disbursement was made in 1998 instead of 1990. Disbursement process was delayed by more than seven years due to processing of the loan and delays in implementation of the project. The project was funded under parallel co-financing. The financing arrangements of Sections 1 and 3 were detailed in the basic project data and in table 3 above.

3.3 Project Management, Reporting, Monitoring and Evaluation Achievements

3.3.1 MOW was named as the executing agency at appraisal. A Project Implementation Unit (PIU) was not created to manage the project. The Director of Trunk Roads had front responsibility to supervise and co-ordinate all activities related to the implementation of the project. Qualified key personnel were appointed to handle project activities.

3.3.2 Borrower submitted to the Bank monthly progress reports prepared at the site by the consulting engineer. The consultant submitted quarterly reports and claim settlement reports. The consultant also submitted the End of Works Report. The Borrower's Completion Report was prepared and submitted to the Bank. Two technical reports were prepared and submitted to the Bank namely:

• Investigations of failure on Section 1 of Tanzam Highway Rehabilitation Project; 1992

• Review of the Tanzam Highway Rehabilitation Project; 1993

3.3.3 No separate audit reports of the project accounts were prepared by GOT. According to Borrower's PCR auditors were unable to access the original disbursement documents for foreign currency payments, which were kept at the Bank. Local payments for the project were however audited according to usual GOT audit procedures. There was no in-house M&E Unit.

4. PERFORMANCE EVALUATION AND RATINGS

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4.1 Relevance of Objectives and Quality at Entry

4.1.1 Project objectives were sound and the project quality at entry was acceptable. Relevance of objectives and quality at entry is rated satisfactory with a score of 3.6. The project was consistent with Tanzania overall development strategy. A three-year structural adjustment programme formulated in 1982 gave priority to the development of road maintenance and rehabilitation, especially in rural areas. In 1982, Road network was in poor condition due mainly to lack of maintenance. The project was also consistent with Bank Group Assistance Strategy, which gives priority to Transport Sector.

4.1.2 The sectoral objectives of the overall Sixth Highway Rehabilitation Project was to rehabilitate the existing road network in order to reduce transport cost, vehicle operating cost and facilitate movement of Agricultural products and associated input supplies. The sectoral and specific objectives of the Tanzam Highway Rehabilitation Project was in line with Transport sectoral goals set out in the structural adjustment programme.

4.1.3 The overall project aimed at assisting MOW to develop road transport policies, planning, manpower capacity building, local contracting business promotion, and priority feeder roads funding

4.1.4 Infrastructure Rehabilitation Projects have an in-built cost overrun risk If the facility is still under operation. The feasibility study for the project adequately properly assessed that risk which was unduly amplified by long delays in the implementation process.

4.2 Achievement of Objectives and Outputs (Efficacy)

4.2.1 Achievements of objectives and Box 1 outcome are rated unsatisfactory with a score of 2.7. Project objectives at appraisal are detailed TANROADS COMMITMENT in paragraph 1.3 above. Physical objectives The Tanzania National Roads Agency were partially met; the project as implemented (RANROADS) was established to manage was limited to a total of 77.90 km against a the trunk and regional roads network of total of 129.90 km targeted at appraisal. The about 35,000-km in the Main Tanzania. It reduction of 41% in the scope of works was enters into Performance Agreement with the Road Fund Board for financing road mainly due to (a) long delays in the maintenance. The Chief Executive of implementation of the project, which led to TANROADS signed a number of further extensive deterioration of the road, and memoranda of Understanding with the (b) inadequate construction materials. Permanent Secretary of MOW for management of development projects. A strategic evaluation performance 4.2.2 National capacity development agreement is been finalised between was built in the project. MOW was assisted to TANROADS and MOW. TANROADS is set-up maintenance planning and programming committed to ensure those existing and unit. It developed road transport policies and newly developed roads network support unit prices for road maintenance works by type economic growth and social development in Tanzania. and by region. In 2000, a new parastatal Agency named TANROADS was set up to 8

handle road planning, construction and maintenance activities on commercial basis.

4.2.3 Thanks to other donors intervention in the corridor, Tanzam Highway continues to support adequate traffic and facilitate movement of crops (coffee, cotton, sisal, tea, maize, etc) grown in the area of influence of the project. Rehabilitation works on bridges and culverts are on-going under World Bank financing and rehabilitation works on section 2 are expected to start under NORAD financing.

4.2.4 Road safety is a constant concern of GOT. Traffic data on accidents in the fiscal year July 2001 to June 2002 is on the increase. The total number of accidents reported was 14,574 out of which 1,580 were fatal causing 1,885 deaths. Cause of accidents includes over speeding, human error, defective vehicles and bad road conditions. GOT has to take strong remedial measures including installing of warning signs, speed bumps, guard rails, pothole partaking, vegetation control on curves, etc. Separate data on accidents on Tanzam Highway was not available.

4.2.5 Axle load control recommended at appraisal time is being implemented by TANROADS. For the quarter April to June 2002, a total of 186,555 vehicles were weighed throughout the country. Out of these, 31,765 vehicles, i.e. 17% were found overloaded. Overloading fees were collected and transferred to the Road Fund Account. There are complaints about the accuracy of weighbridges and corruption among some weighbridge operators. Genuine or not, those complaints have to be settled by an appeal organ.

4.3 Efficiency

4.3.1 The economic benefits did not fully materialise mainly due to (i) decrease in Zambian export/import cargo, (ii) unsatisfactory recovery of the Tanzanian economy, (iii) El Nino, and (iv) poor performance of the agro-industry. The alternate outlet to the sea offered to Zambia through Zimbabwe and post-apartheid South Africa and also the slow recovery of the Zambian economy could explain the decrease in Zambia export/import cargo in the corridor. The ERR at appraisal was estimated at 24.4%. ERR re-estimated at completion was 14.4%. Post evaluation mission concurred with PCR re-estimation of the ERR.

4.3.2 Economic benefits and costs were based on (i) annual savings in vehicle operating costs (VOC) due to the road improvement, and (b) annual savings in maintenance costs on the rehabilitated road as compared to the situation without project. It was envisaged that the improved pavement would go through a 20-year life span without heavy recurrent and periodic maintenance costs. Other benefits envisaged were, among others, time saving; easy access to markets for agricultural products and manufacturing industries.

4.3.3 The project is in competition with the Railways sub-sector. TAZARA Railway is operating in the same transport corridor as Tanzam Highway linking the Tanzanian/Zambian border town of Tunduma to Dar es Salaam Port. TAZARA concentrates on the transport of heavy, long distance traffic and TAZARA competition could also explain the poor performance of the project.

9

4.3.4 The project is still viable. There are some seasonal factors to be taken into account when assessing the viability of the project. According to the Borrower's Completion Report of November 1997, ERR of Tanzam Highway after rehabilitation of the sections has been estimated at 41%, compared to 39% at appraisal; Section 1 of the road which was rehabilitated with ADF funding registered an impressive ERR of 75%. The report indicated growth of traffic almost three times more than the appraisal estimates, due to higher economic activity and the improvement of road sections. By late November 1999, ADB PCR mission recorded low economic activity on the road.

4.4 Institutional Development Impact

Human and Institutional Development Impact

4.4.1 The project achieved its target of skills upgrading; MOW staff was trained including four engineers and four technicians. The staff were attached to the supervising consultant on site and participated in all aspects of road construction for more than 18 months gaining good experience, which has been invaluable to the MOW. The joint venture between the foreign consultant and the National Estates and Designing Corporation (NEDCO) provided invaluable exposure to a local consultancy company thereby contributing to the building of local consultancy capacity in Tanzania. The Bank promoted the joint venture idea. The project had a positive impact on human development.

4.4.2 The executing agency was able to manage the project despite the frequent changes in job assignment to the MOW and the turnover of project co-ordinators. Those changes negatively impacted on the project.

4.4.3 MOW has undergone significant changes. The Tanzania National Roads Agency (TANROADS) was established on 1/7/2000 under the Executive Agencies Act, 1997, by an Order gazetted under Government Notice (GN) No. 293 dated 25th August 2000. The goal of TANROADS is to provide cost-effective and suitable maintenance and development of the trunk and regional road network to support the socio-economic development of Tanzania. TANROADS transition activities are on going; it is developing a computerised Road Maintenance Management System with technical assistance from Transport Research Laboratory (TRL) of UK.

4.4.4 Sectoral capacity is improving. TANROADS a new parastatal body was established to operate the road sub sector on commercial basis. During 2000, the Transport and communication sector grew by 6.1 percent due to improvement of transportation and telecommunication services. Its contribution to GDP was 5.4 percent. Many Tanzanians acquired experience in road construction through employment in all sections of the road. The experience acquired is available within local contracting companies in the country. The project contributed to building local contracting capacity and has had it had a positive impact on institutional development in the sector.

Private sector development

4.4.5 Local private contractors participated in the construction works. Some of them have now the capacity to contract road building and maintenance activities. The project had a positive impact on private contracting firm development.

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4.4.6 MOW was involved in the restructuring of public enterprises. At appraisal, the private sector accounted for about 85% of freight movement; the road transport industry is still dominated by private owners. The Highway Act is being reviewed. TANROADS was established in 2000.

4.4.7 Foreign investors were not targeted by the project. Tanzania continues to improve the business environment. The National Investment Act was reviewed in 1997 in order to provide faster and quality services to investors. The number of jobs created through the National Investment Centre is on the increase. In 2000, the total of jobs created was 241250 for an investment of TZS million 4,957,288. The share of the Transport Sector was 12,970 jobs (5.37%) and TZS million 129,368 (2.61%). Direct foreign investments are also growing. The growth of Foreign Direct Investment flows rose from USD million 154.63 in 1997 to 224.40 in 2001.

Poverty Alleviation

4.4.8 Poverty alleviation, which was not directly targeted by the project, registered slow improvement due to (i) poor condition of feeder roads, (ii) severe climatic conditions, and (iii) reduction in the scope of works. The project has had a limited positive impact on poverty alleviation.

4.4.9 GOT carried out the 2000/01 Household Budget Survey (HBS 2000/01). The objectives of the survey include among others, data collection to assess the welfare of Tanzanians belonging to different classes. The HBS 2000/01 results on poverty indicators fall under two main categories: the non-income indicators of poverty and the income measures of poverty. The Transport sector including Tanzam Highway is a key provider of access to social services, education and health.

Impact on Women

4.4.10 In Tanzania women are traditionally involved in agriculture especially in the area of influence of the project. Women and economically active women constitute an important proportion of people benefiting from the project. Provided the feeder roads are properly maintained, the road will help women farmers and farmers co-operatives to enter the market economy. The impact of the project on women is positive. TANROADS is involved in training local contractors. In Coastal Zone, Lindi region in particular, several women contractors were trained by the Road rehabilitation and Maintenance Project financed by Finish International Co- operation Agency (FINNIDA).

4.4.11 GOT committed themselves to women empowering, emanating from the resolutions of the fourth world conference on women in Beijing China in 1995. In 2001, some of the resolutions which GOT continued to implement were in the following areas: (i) enhancing economic base of women; (ii) developing the educational level of women; (iii) increasing women participation in decision making institutions to 30 percent; and (iv) abolishing oppressive or segregate legislation against women.

Impact on environment

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4.4.12 There was no environmental impact assessment study for the project but environmental considerations played an important role in design and the negative impacts on soils and water were carefully minimised during construction and for the design life span of the road. The project did not vary much from the already demarcated alignment. One of the two existing borrow pits was closed and the land rehabilitated. The second borrow pit is still being used.

4.4.13 The road alignment was carefully designed and does not exhibit safety hazards. Appropriate safety equipment including guard-rails, road markings and traffic signs were comprehensively provided. The road has a positive impact on environmental safety, although the number of accidents in Tanzania is still high (Ref. par. 4.2.4).

4.4.14 The shortcoming of this project from the point of view of environmental impact was the failure to protect of slopes against erosion and instability, especially in section 3. Appropriate maintenance programmes should address this shortcoming.

4.4.15 The project has a positive impact on the conservation of bio-diversity. Morogoro and Mikumi national parks and game reserves traversed by the road are well protected.

4.5 Sustainability

4.5.1 At appraisal, the project was found to be technically sound; the overall project made provision for Operation and Maintenance arrangements. The scope of works was indicated by the feasibility study taking into account the risks linked to rehabilitation activity. TANROADS is in charge of maintenance of trunk and regional roads and also runs subsidiary activities such as the Central Materials Laboratory (TANLAB), Regional Road Workshops, etc.

4.5.2 Regional Road Workshop (Equipment hire units - EHU) are located in Arusha, Dar es Salaam, Coast and Kilimanjaro. Two of them are located in the Tanzam corridor namely Dar es Salaam EHU and Coast EHU. The main objective of these units is to ensure that TANROADS regional offices make economic of the limited available resources of motor vehicles, plants and construction equipment with the aim of improving road conditions in their regions. The Units operate on self-financing basis and their main customers include the Trunk and rural road engineers and building contractors. Equipment is used on Force Account Operations basis on Trunk Roads including Sections 1 and 3 of Tanzam Highway. EHU plays key role in road maintenance activities.

4.5.3 There are development projects on going on the Tanzam Highway corridor including IDA funded Emergency Rehabilitation of 22 Trunk road bridges. A feasibility study of Tunduma-Sumbawanga road is being carried out under IDA funding. The Rehabilitation of Songwe-Tunduma road is under implementation and the rehabilitation of Section 2 of Tanzam Highway is programmed for next year, both under NORAD financial support. GOT is taking necessary actions to make the project sustainable.

4.5.4 Maintenance activities are carried out by TANROADS on Trunk Roads including Tanzam Highway. For the fiscal year 2001/2002, 7,385 km out of the annual plan of 9,001 km have been maintained. Cumulatively a total of 977 km have been repaired under Emergency. Bridge preventive maintenance works have been carried out for a total of 649 bridges and major repairs have been carried out on 66 bridges. 12

4.5.5 Sustainability of Tanzam Highway depends also on the condition of Regional Roads in the area of influence of the project. Feeder roads that are part of Regional Roads facilitate movement of crops in the Tanzam corridor. TANROADS is involved in Regional Roads network maintenance, emergency repairs and bridge preventive and bridge repairs activities. For the fiscal year 2001/2002, 7,086 km out of the annual plan of 9,868 km has been maintained. A total of 768 km have been maintained under emergency repairs. Preventive maintenance works were carried out for a total of 392 bridges and major repairs were carried out on 30 bridges.

4.5.6 Development works and maintenance activities give indication of continued Borrower's commitment to sustain the project. However, there is a shortfall in the funding. For the year 2001/2002, overall physical performance was 72% for network maintenance and 28% for bridge maintenance while corresponding total financial expenditure was 78% of the annual plans. Some of the maintenance activities have rolled over to the next fiscal year, worsening backlog maintenance. The causes of this backlog include the untimely release of funds, delay in procurement in accordance with the Procurement Act 2001, and erratic refund of VAT.

4.5.7 Financial annual plan for 2001/2002 indicates a total amount of TZS 60,818,067,000 of which 60% is earmarked for Trunk Roads. The Road Fund is contributing 52% and Donors 35%. The total allocation is less than what is required for adequate road maintenance. Table 5 below shows sources of funding commitment for the FY 2001/02.

Table 5 FY 2001/02 Maintenance Budget (TZS '000')

Trunk Roads Regional Roads TANROADS Total Percentage Activities

Road Fund 16 651 264 10 922 738 3 791 000 31 365 002 51,57 Roll-Over 5 647 559 2 547 506 - 8 195 065 13,47 Funds Donors 13 747 000 7 511 000 - 21 258 000 34,95 Total 36 045 823 20 981 244 3 791 000 60 818 067 100,00 Percentage 59,27 34,50 6,23 100,00 Source: TANROADS Quarterly Report April to June 2002

4.6 Aggregate Performance Rating

4.6.1 The performance rating tables are given as Annex 3. The overall performance was unsatisfactory (rated 2.68). Shortcomings were registered in the Achievement of Objectives and Outcomes, Institutional Development Impact. The project was resilient to exogenous factors (Zambia export/Import and decline in agriculture activities). Borrower's continued commitment is hampered by lack of adequate maintenance financing.

4.6.2 Relevance of Objectives and quality at entry was satisfactory (rated 3.60). The project was well designed and well prepared. The project has attracted bilateral and multilateral donors due to the quality of the preparation.

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4.7 Performance of the Borrower

The Borrower's performance was unsatisfactory (rated 2.77). Shortcomings were registered on (i) counterpart financing, and (ii) adherence to time schedule and costs (Ref. par. 3.2.2).

4.8 Bank Performance

The Performance of the Bank was unsatisfactory (rated 2.83). Bank supervision missions failed to pay attention to identify the likely social development impact and sustainability issues as detailed in Annex 5.

4.9 Factors affecting Implementation Performance and Outcome

4.9.1 The project suffered from deterioration of terms of trade for Tanzania products, market prices of Zambia copper, and erratic changes in weather conditions. Poor performance of contractors also undermined the outcomes of the project.

4.9.2 Devaluation of TZS and high inflation rate were factors under GOT control. Those factors substantially affected the Implementation Performance of the project (Ref. par. 3.2 and Table 4).

4.9.3 The implementation of the project experienced long delays in recruitment of contractors, inadequacy of price/physical contingencies, changes in the scope of works and inadequate control of quarries and materials.

5. ECONOMIC INTEGRATION AND REGIONAL CO-OPERATION

5.1 Background

5.1.1 The Tanzam Highway was constructed in the early seventies; its construction was necessitated by the difficulties Zambia was facing as a result of closure of the border between Zambia and Southern Rhodesia (Zimbabwe) in 1973. Zambia's traditional routes to seaports through Zimbabwe were no longer available. Several transport modes were put in use to meet Zambia's export/import needs including trucks, trains, aeroplanes and Lake Steamers. The use of the road between Dar es Salaam and the Tanzania/Zambia border at Tunduma made the most critical contribution.

5.1.2 The Tanzam Highway crosses the south-western part of the country, passing through Coast, Morogoro, Iringa, and Mbeya regions. The total population in the four regions is estimated at 7.5 million people occupying about 23% of the total land area in Tanzania. The Tanzam Highway is one of the important routes in Tanzania.

5.2 Regional Goals at Appraisal

5.2.1 Long term economic co-operation between Zambia and Tanzania was envisaged by developing the Zambia-Dar es Salaam transport routes (Tazama pipeline, Tanzam Highway and TAZARA Railway). Some of the indicators of economic co-operation provided by the 14

Appraisal Report were (i) real commitment to co-operate, (ii) lower transport cost and travel time, and (iii) co-ordinated regional production development and optimal industrial location

5.3 Achievements

5.3.1 At completion, economic integration and regional co-operation objectives were partially met. The Zambia/Zimbabwe border was open, the apartheid system had been abolished in RSA offering alternate outlet to the sea to Zambia export/import cargo. Indicators set out in the Appraisal Report provide further explanations:

• Real commitment to co-operate. Means of Verification of this indicator include comparative Tanzania/Zambia macro-economic aggregates, Trade profiles, Membership in the same regional groupings, Government statistics, etc. Tanzania still remains member of EAC and SADC. but opted out of COMESA effective October 1, 2000. The Trade Profile of Tanzania, compiled from Bank of Tanzania Economic and Operations Report is shown in Table 6. Table 6 Tanzania Trade Profile with PTA Countries (million TZS) Country 2001 2001 2000 2000 Exports Imports Exports Imports Burundi 5 362,60 140,10 3 388,10 9,30 Comoros 14,90 - 25,80 - Djibouti 24,90 - 87,20 12,50 Ethiopia 643,50 468,40 358,70 2 602,80 Kenya 33 392,20 84 205,80 25 811,10 74 734,00 Lesotho - - - - Malawi 4 932,00 1809,10 4 927,10 1 520,90 Mauritius 288,70 3 656,30 158,30 2 574,70 Rwanda 1 992,40 68,50 1 457,00 155,80 Somalia 129,60 7,10 365,80 1,50 Swaziland - 11 083,90 170,80 10 296,20 Uganda 4 858,70 9 962,50 6 770,90 4 501,00 Zambia 4 820,90 1 578,20 3 778,50 1 919,80 Zimbabwe 369,40 2 640,80 2 149,80 3 619,60 Total Region 56 829,80 115 620,70 49 449,10 101 948,10 Overall 681 156,40 1 502 450,50 527 773,70 1 227 757,60 Region/Overall 8,34 7.70 9,37 8,30 Source: 2001 BOT Economic and Operations Report

Tanzania's Regional Trade Integration ratio (Region/Overall) is less than 10% of the overall trade potential for the last two years. Trade statistics in West Africa show that intra-regional export/import ratio, as a percentage of total export/import is 5 and 6 % for the year 1998. Tanzania also has a chronic overall trade deficit especially with Kenya and Uganda, members of AEC and Zambia.

Overlapping. Some regional groupings are overlapping as result of multiplicity of integration institutions and multi-membership of countries in those organisations. 15

Bank of Tanzania stated that some regional grouping are facing in-built conflict factors.

• Lower transport cost and travel time

The obstacles placed in the way of free and cost-effective movement of persons and goods include (a) high VOC, (b) numerous and sometimes illegal road blocks or barriers, (c) cumbersome procedures at border posts, involving undue delays amounting to harassment, etc.

• Co-ordinated regional production development and optimal industrial location

The barriers to economic Box 2 integration can be summarised East African Co-operation Development Strategy 1997- as follows: each regional 2000 The first development strategy of EAC focussed, among grouping member is producing others on Facilitation of Interstate Transport and the same crops, then selling the Improvement of Communication Links. In that respect, same products. Each member is Kenya, Uganda and Tanzania entered into a Tripartite Agreement on Road Transport. The Evaluation report of buying the same fertilisers and the implementation of the strategy came out with the machines that are not conclusion that there are two main issues to be addressed: manufactured in the grouping. 1. Lack of resources and the narrowness of the sources of these resources, counterpart funding, Twin economies can hardly be as part of donor conditionality requirements integrated; they are not overstretched national budgets. complementary. Co-ordinated 2. Prioritisation of regional roads had not been harmonised with the prioritisation at the production development and national level. Member States have accorded low optimal industrial location has priority to some of the regional roads although not materialised yet. these roads were ranked high at regional level. Other actions taken in the way of improving the contribution of road sub-sector to economic integration 5.3.2 SADC Contribution and regional co-operation include: (i) Free movement of vehicles based on COMESA Standards, (ii) Police Road Tanzania is an active member of Blocks/Checks on Designated Routes, (iii) Study on Regional Roads, and (iv) Road Safety. Southern Africa Development Community (SADC) formed in 1992. The objectives of SADC are to promote co-operation and integration in the region, sectoral co-ordination, and improve transport links - SADC has sector co-ordination Units in each member state; it has achieved significant improvement in trade links. In 1996, SADC State members entered into a protocol named SADC Protocol on Transport, Communication and Meteorology. The general objective of the Protocol is to establish transport, communications and meteorology systems which provide efficient, cost-effective and fully integrated infrastructure and operations, which best meet the needs of customs and promote economic and social development while being environmentally and economically sustainable. The first two strategic goals among others are:

(i) Integration of regional transport communications and meteorology networks to be facilitated by the implementation of compatible policies, legislation, rules, standards and procedures

(ii) Elimination or reduction of hindrances and impediments to the movement of persons, goods, equipment and services. 16

The Protocol made provision for Integrated Transport, Road Infrastructure, Road transport, Road Traffic, Railways, Maritime and Inland Water Transport, Civil Aviation, Telecommunication, Postal Services, Meteorology, and Institution, Implementation and Monitoring. SADC will be a key partner in finalising the Terms of Reference, and conducting the envisaged ADB study on contribution of Infrastructure projects to economic integration and regional co-operation.

6. CONCLUSIONS, LESSONS LEARNT AND RECOMMENDATIONS

6.1 Conclusions

6.1.1 The Tanzam Highway Rehabilitation Project as part of the Sixth Highway Rehabilitation has partially met its objectives. The project remained viable in spite of reduction in the scope of works. Vehicle Operating Cost was reduced by 30%.

6.1.2 The project has contributed to capacity building opportunities for MOW staff, local consultancy firm and local contractors.

6.1.3 New political developments and other transport modes hampered regional co- operation goals assigned to the project.

6.2 Lessons learnt

6.2.1 Delays in loan and project processing had adverse impact on the project causing further deterioration of the road

6.2.2 For rehabilitation projects, physical contingencies can be unpredictable.

6.2.3 In a structural adjustment environment, price contingencies can also be unpredictable.

6.2.4 Investigations into sources of construction materials caused a long delay in the implementation of the project.

6.2.5 Strong commitment and political will are necessary to achieving regional co- operation goals.

6.3 Recommendations

6.3.1 Duration of engineering studies, project appraisal, tender award and star-up of works should be kept to the minimum. It is suggested that cost estimates for future rehabilitation projects be updated to a date no more than six months at the time of start-up of works (ref. par. 3.1.2, 3.1.3 and Borrower's PCR.)

6.3.2 Mid-term review should be conducted especially for projects experiencing long delays and substantial changes in the scope of works (Ref. par. 3.1.4, 3.1.5 and Borrower's PCR).

6.3.3 Detailed investigation into sources of construction material must be 17 undertaken as part of engineering study and adequate funding must be allocated thereof. (Ref. par. 3.1.5 and Borrower's PCR).

6.3.4 Strong commitment and political will indicators need to be designed within an Economic Integration and Regional Co-operation Aggregate Index (cf. par. 5.3.1).

ANNEX 1

TANZANIA - TANZAM HIGHWAY REHABILITATION PROJECT RETROSPECTIVE LOGICAL FRAMEWORK

Narrative Summary Observable Verifiable Indicators Means of Risk/Assumptions At Appraisal At Completion AT Post-evaluation Verification

Goal: (Goal to super goal) 1. Rehabilitation of 1. Rehabilitation of 1. Rehabilitation of 1. Traffic survey. 1..Agriculture and 1. The sector goal is to 1100km of Tanzam 1040 km of Tanzam 1040 km of Tanzam Economic Survey other productive improve the road Highway Road Highway Road Highway Road sectors implement the network in order to right policies to support economic stimulate economic growth through and social Agricultural products development. and associated input supplies Project Objective: (Project objective to 2. To reduce 2. Reduce VOC by 2. Reduce VOC by 2. Reduce VOC by 2. VOC survey Goal) transport costs by 20% by 1990 20% by 1990 20% by 1994 Roughness minimising vehicle Reduce roughness to Reduce roughness to Reduce roughness to investigation 1.1.Adequate operating and be less than 3,000 be less than 3,000 be less than 3,000 Traffic count Government maintenance costs mm/km till 2014 mm/km till 2014 mm/km TANROADS Annual commitment for the in Section 1 & 3 ADT of 997 by 1997 ADT of 997 in 1997 ADT of 997. budget successful implementation of the physical components of the Sixth Highway Road Project

Results

3. 2-lane bituminous 3. 129.9 km of road 3. 77.90 km of road 3. 77.90 km of paved 3.1 Quarterly (Outputs to Project standard road with paved by 1990 paved by 1994 road by 1994 Progress Reports Objective) 6.5m wide 3.2 Annual Reports carriageway and two Section 1. 44.45 km Section 1. 44.45 km 3.3 Audit Report 3.1. (MOW) Road 1.5m shoulders of Section 3. 33.45 km Section 3. 33.45 km 3.4 As-built drawings Agency will maintain Tanzam Road with a 3.5 Borrower end of the road after its total of 129.9 km works report completion. Section 1: 84.9 km 3.6 Bank PCR 3.2 Budgetary Section 3: 44.97 km allocation available

Activities Construction works Input/Resources Input/Resources Input/Ressources 4.1 Appraisal Report (Activity to Output) 4.1 Pre-qualification Input: Million UA Input: Million UA Input: Million UA 4.2 End of Contract of contractors Report Request for Proposals 4.1 Civil Works 4.1 Civil Works 4.1 Civil Works 4.3 Borrower PCR 1.1 All procurement Tenders Evaluation, 16.65 19.49 19.49 4.4 Bank PCR actions are on Negotiation and 4.2 Supervision 4.2 Supervision 4.2 Supervision 4.5 Disbursement schedule award of Works 1.11 Works 1.67 Works 1.67 Records 1.2 Payments for Contracts. invoices are not 4.3 Contingencies delayed 4.2. Consultancy Physical 1.77 5.0 Resources 5.0 Resources 1.3 Timely release Services: Price 3.91 ADF 17.67 ADF 17.67 of local Total 23.44 GOT 3.49 GOT 3.49 counterpart Total 21.16 Total 21.16 funds 4.2.1 Approval of 5.0 Resources 1.4 Scope of Short list, and ADF 17.68 EIRR 14.40% EIRR N.A. works higher RFP GOT 5.77 Effective supervision 4.2.2 Issue and receipt Total 23.44 by the Bank and of RFP Executing Agency. 4.2.3 Evaluation and EIRR 25.6% approval of proposals. 4.2.4 Award of consultancy services 4.3.5 Commencement of services.

ANNEX 2

TAZANIA - TANZAM HIGHWAY REHABILITATION PROJECT

SELECTED MACROECONOMIC INDICATORS

Indicators Unit 1996 1997 1998 1999 2000 2001

National Accounts GNI at Current Prices Million US $ 6 378 7 583 8 534 8 386 8 984 9 566 GNI per Capita US$ 190 210 240 260 280 .. GDP at Current Prices Million US $ 6 496,2 7 683,9 8 589,2 8 762,6 9 027,5 9 075,6 GDP at 1995 Constant prices Million US $ 5 494,1 5 687,3 5 916,9 6 196,7 6 512,7 6 812,3 Real GDP Growth Rate % 4,5 3,5 4,0 4,7 5,1 4,6 Real per Capita GDP Growth % 1,6 0,8 1,4 2,2 2,6 2,1 Rate Gross Domestic Investment % GDP 17,0 15,2 16,2 15,5 17,7 18,1 Public Investment % GDP 4,1 3,2 3,3 3,1 3,4 3,8 Private Investment % GDP 12,9 11,9 12,9 12,4 14,3 14,3 Gross National Savings % GDP 3,0 2,1 8,2 10,3 15,9 14,1

Prices and Money Inflation (CPI) % 21,0 16,1 12,8 7,9 5,9 5,2 Exchange Rate (Annual local 580,0 612,1 664,7 744,8 800,4 876,4 Average) currency/US$ Real Exchange Rate Index Base 1995=100 85,9 79,9 78,1 82,9 86,9 93,5 Monetary Growth (M2) % 8,4 12,9 10,8 18,6 14,8 3,4 Income Velocity (GDP / M2) % 5,6 6,3 7,1 6,8 6,8 ..

Government Finance Total Revenue and Grants % GDP 16,6 15,9 16,7 16,8 16,8 18,1 Total Expenditure and Net % GDP 16,4 15,8 17,4 19,7 18,2 20,1 Lending Overall Deficit (-) / Surplus % GDP 0,2 0,2 -0,7 -2,9 -1,4 -2,0 (+)

External Sector Exports Volume Growth % 22,2 0,7 -18,1 -9,2 25,8 26,7 (Goods) Imports Volume Growth % -9,6 -3,6 33,6 1,5 -2,2 12,4 (Goods) Terms of Trade Growth % -11,6 -12,4 31,0 8,8 -7,2 -8,2 Current Account Balance Million US $ -892,0 -980,8 -627,3 -324,1 -144,1 -148,5 Current Account Balance % GDP -13,8 -12,9 -7,5 -3,8 -1,6 -1,6 External Reserves Months of imports 2,5 3,4 3,1 4,1 5,6 ..

Debt and Financial Flows Debt Service % exports 37,7 37,1 35,0 32,3 19,7 24,2 External Debt % GDP 116,6 103,0 91,5 89,4 83,0 82,6 Net Total Financial Flows Million US $ 975,1 976,6 995,3 904,0 1 194,2 1 072,5 Net Official Development Million US $ 877,1 944,7 1 000,2 990,0 1 044,6 1 079,7 Assistance Net Foreign Direct Investment Million US $ 149,0 158,0 172,0 183,0 193,0 .. Source : ADB Statistics Division; World Bank: Live Database,

ANNEX 3 Page 1 of 2

TANZANIA - TANZAM HIGHWAY REHABILITATION PROJECT

EVALUATION CRITERIA

No. Component Indicators Score REMARKS (1 to 4)

1 Relevance and quality at entry 3.60 Satisfactory. The project was well prepared by assessment World Bank i) Consistency with country overall 4 The three-year structural adjustment programme development strategy formulated in 1982 assigns priority to the improvement road maintenance particularly in the rural areas. Ii) Consistency with Bank Assistance 4 Bank Assistance Strategy gives priority to Transport Strategy Sector Iii) Sector Policy 4 GOT undertook a study on sectoral planning and co- ordination Iv) Poverty Reduction 3 The overall Sixth Highway Rehabilitation programme prepared under World Bank Assistance indirectly aimed at Poverty Reduction v) Environment Concerns 3 Reduction of accidents. Provision for protection of Ruaha National Park, Rungwa Game reserve, Selous Game Reserve, Mikumi National Park. Vi) Human Resources Development 3 Overall Sixth Highway Rehabilitation made provision for training Vii) Institutional Development 1 Institutional Development was not part of the Tanzam Highway Project Viii) Private sector Development 1 Not included in the project IX) Regional Economic Integration 4 The Project was designed to impact on Zambia/Tanzania economic co-operation X) Quality at entry (including 3 Infrastructure Rehabilitation has in-built cost overrun demandingness, complexity, risk riskiness, etc.) 2 Achievement of objectives & 2.70 Unsatisfactory. Intensive deterioration of the road outcomes ("Efficacy") forced GOT to reduce the scope of works i) Policy Goals NA ii) Physical objectives (output) 2 The scope of works was reduced by 50% iii) Financial Targets 2 Unsatisfactory Inflation 2 2-digit Inflation Rate Exchange Rate 2 Devaluation of TZS. Actual price escalation registered an increase of 6629% compare to appraisal estimate Iv) Institutional Development 3.00 Satisfactory. ID objectives were sound at appraisal Objectives National Capacity 3 Satisfactory • Poverty Alleviation 3 Indirect targeted The zone of influence of the road accounts for 25% and 23% of the area and population of Tanzania • Environment & natural 3 Parks and Reserves Conservation concerns taken into resources account • Sectoral Capacity 3 Transport Sector contribution to the economic growth would be strengthened Executing Agency 3 Satisfactory • Skills upgrading 3 Funds earmarked for training of engineers, planners, road technicians and field personnel • Other (Technical Assistance) 3 Technical Assistance including four advisors to MOW envisaged v) Social Objectives and Targets 2 Unsatisfactory Poverty Alleviation 2 Indirect target not achieved

ANNEX 3 Page 2 of 2 TANZANIA - TANZAM HIGHWAY REHABILITATION PROJECT

EVALUATION CRITERIA

No. Component Indicators Score REMARKS (1 to 4) Vi) Environment Objectives 3 Satisfactory Natural Resource Management 3 Tourist Potential put on track Maintenance of biodiversity 3 National Parks well protected Maintenance of soil, air and water 3 It is a rehabilitation project; geometric alignments quality remained unchanged; soil was protected Vii) Private Sector Development 3 The overall project made provision for local Objectives contractors assistance 3. Efficiency 2.00 Unsatisfactory i) Economic Rate of Return 2 ERR is 40.9% less than Appraisal Estimate • Appraisal Estimate 24.4% • PCR/PPER Re-estimate 14.4% 4. Institutional Development Impact 2.83 Unsatisfactory. Crops movement target was not achieved National Capacity 2.66 Unsatisfactory • Poverty Alleviation 2 Movement of crops not facilitated • Environment & natural 3 Parks and Reserves Conservation concerns were resources materialised • Sectoral Capacity 3 Transport Sector contribution strengthened Executing Agency 3 Satisfactory • Skills upgrading 3 Training programme was implemented • Other (Technical Assistance) 3 Technical Assistance component completed 5. Sustainability 2.57 Unsatisfactory The road sustainability was hampered by backlog maintenance and alternative routes and other modes i) Technical Soundness(including 3 The project, at appraisal was technically sound; the O&M facilitation, availability of scope was indicated by the feasibility study. The recurrent funding, spare parts, Road Fund was created to provide recurrent funds workshop facilities, etc.) and to facilitate O&M activities ii) Continued Borrower Commitment 1 Borrower complies with loan conditions related to (including legal/regulatory axle load control regulation and local counterpart framework) funds for the project. However, Borrower failed to secure founds for periodic maintenance of the road. iii) Socio-political Support (including 3 Tanzania remains politically stable beneficiary participation, vulnerable groups protection, political stability) iv) Economic Viability 3 The project is still viable v) Financial Viability NA vi) Institutional arrangements 3 GOT has set-up a new parastatal agency, (organisational and management) TANROADS, to manage roads activities in the country. GOT now concentrates on policy making and sectoral regulatory process vii) Environment viability 3 The project did not affect negatively environment viii) Resilience to exogenous Factors 2 The viability of the project suffered from copper mine market and Zambia Exports/Imports alternative routes 6. Aggregate Performance Indicator 2.68 Unsatisfactory. Except quality at entry, all indicators were rated unsatisfactory

ANNEX 4

TANZANIA - TANZAM HIGHWAY REHABILITATION PROJECT

BORROWER'S PERFORMANCE

No. Components Indicators Score REMARKS (1 to 4) 1 Quality of preparation 2.66 Unsatisfactory • Ownership, Beneficiaries 3 There is no doubt about the ownership of participation the road. No indication on participatory approach in the Appraisal report • Government commitment 3 GOT committed itself to the success of the project • Macroeconomic and Sector NA policies • Institutional Arrangements 2 GOT experienced difficulties in (counterpart funding) providing project with adequate counterpart funds partially due to the devaluation of TZS 2 Quality of Implementation 2.40 Unsatisfactory • Assignment of Key Staff 3 Key Staff were appointed with high turn- over • Management Performance of 2 Executing Agency Performance was Executing Agency hampered by frequent changes in ministerial organisation • Use of Technical Assistance 4 GOT took advantage of TA provided by the project • Mid-Course Adjustments 2 Poor mid-term adjustments due to lack of local counterpart funds • Adherence to time schedule & 1 Project implementation suffered from costs long delays in loan processing, procurement of works and soil investigation 3 Compliance with Covenants 3 All loan conditions were fulfilled except one 4 Adequacy of Monitoring & NA Evaluation and Reporting 5 Satisfactory Operations (if 3 Road is opened to traffic applicable) Overall Borrower Performance 2.77 Unsatisfactory

ANNEX 5

TANZANIA - TANZAM HIGHWAY REHABILITATION PROJECT

BANK PERFORMANCE

No. Component Indicators Score REMARKS (1 to 4)

1. At Identification 3 Satisfactory 1.1 Project consistency with Bank 3 The gives priority to Transport Sector Strategy 1.2 Project consistency with Bank 3 The is committed to developing basic strategy for country infrastructure 1.3 Involvement of 3 GOT was fully involved in the project government/beneficiaries 1.4 Project innovativeness NA 2 At Preparation of Project There was on preparatory mission on this project 2.1 Relevance of Bank support NA 2.2 Timely Bank support NA 3 At Appraisal 3 Satisfactory 3.1 Quality of technical, economic, 3 Geometric design and traffic forecast financial, institutional, social, were adequate environment analyses 3.2 Relevance of Conditions and 3 Acceptable. The Bank needs to review covenants one of the general conditions causing Borrower to hold separate account for the proceeds of the loan. 3.3 Adequacy of lending instrument 3 ADF window was adequate 3.4 Financial package adequacy 3 Acceptable 3.5 Quality of co-ordination with NA It is parallel co-financing. There is no other donors/partners record of any joint appraisal or joint supervision mission on the project 3.6 Implementation & Supervision 3 Implementation schedule ans supervision plans (including performance plans at appraisal were good. No indicators, M&E requirements) performance indicators were included in the project file 4 At Supervision 2.50 Unsatisfactory 4.1 Adequacy of Bank staff (skills, 3 The supervision was adequate time & continuity) 4.2 Problem solving 3 The Bank played its role during premature failure investigation 4.3 Responsiveness to changing 2 The changing of conditions process conditions includes time consuming procedures 4.4 Realistic ratings at CPPR/APPR 3 ERR ratings are acceptable. There are seasonable factors to be taken into account. 4.5 Attention to likely social 2 Supervision missions did not pay development impact attention to social development issues 4.6 Attention to sustainability issues 2 -ditto- 5 Overall Assessment of Bank 2.83 Unsatisfactory Performance

ANNEX 6 Page 1 of 2

TANZANIA - TANZAM HIGHWAY REHABILITATION PROJECT

FACTORS AFFECTING IMPLEMENTATION PERFORMANCE AND OUTCOME

No. Factors Subst Par Neg N/A REMARKS antial tial ligi ble 1 Not subject to Government control 1.1 World Market prices - Zambia Export/import cargo 1.2 Natural events - Adverse climatic conditions have hampered Tanzania agro- industry 1.3 Bank Performance + The project did not suffered from Bank poor performance 1.4 Performance of - Premature failure of the road contractors/consultants base course was due to poor investigation of source of materials 1.5 Civil war + N/A 2 Subject to Government control 2.1 Macro policies - 2-digit inflation rate and continued devaluation of TZS 2.2 Sector policies + Transport policies were adequate 2.3 Government commitment - Government commitment was not continued 2.4 Appointment of key staff + Key staff were timely appointed 2.5 Counterpart funding - Lack of counterpart fund hampered project implementation 2.6 Administrative capacity + Project administration was adequate 3 Subject to Executing Agency Control 3.1 Management + Project management was adequate 3.2 Staffing - Project co-ordinator turn over 3.3 Use of technical assistance + Advisory TA task helped implementation of the project 3.4 Monitoring & Evaluation N/A 3.5 Beneficiary Participation - There are no records on beneficiaries participation

ANNEX 6 Page 2 of 2

TANZANIA - TANZAM HIGHWAY REHABILITATION PROJECT

FACTORS AFFECTING IMPLEMENTATION OUTCOME

No. Factors Subst Par Neg N/A REMARKS antial tial ligi ble 4 Factors Affecting Implementation 4.1 Changes in project - Further deterioration of the road scope/scale/design have changed scope and scale of works 4.2 Deficiency in estimating + Physical and unit base cost were physical inputs, the base adequate unit cost 4.3 Inadequacy of - Due to long delays in project price/physical implementation process, price contingencies and physical contingencies became obsolete 4.4 Changes in exchange rates, - Devaluation of TZS have had in financial and negative effects on the project institutional arrangements 4.5 Unrealistic implementation - Project implementation schedule schedule was sound 4.6 Quality of management + The proceeds of the loan were including financial not audited but management management was adequate 4.7 Delays in selecting - Delays in selecting contractors staff/consultants/contractor and in receiving counterpart s and in receiving funds impacted negatively on counterpart funds the implementation of the project 4.8 Inefficient procurement - Procedures did not have any and disbursement significant effects on the project procedures

ANNEX 7

TANZANIA - TANZAM HIGHWAY REHABILITATION PROJECT

RECOMMENDATIONS AND FOLLOW-UP MATRIX

MAIN FINDINGS & RECOMMENDATIONS FOLLOW-UP ACTIONS RESPONSIBILITY CONCLUSIONS

Delays in loan and project processing Duration of engineering studies, project Advance Procurement facilities RMCs and Operations had adverse impact on the appraisal, tender award and start-up of should be considered for Departments rehabilitation project. The road works should be kept to the minimum. rehabilitation projects. continued further to deteriorate.

Section 1 showed premature failure. Mid-term review should be conducted Reinforce guidelines on project POPR and Operations The works were stopped for two especially for projects experiencing long supervision Departments years for investigations. delays and substantial changes in the scope of works. .

Inadequate construction material Detailed investigation into sources of The appraisal team should carefully RMCs and Operations delayed the project and increased the construction material should be undertaken review the detailed design study Departments cost of the project as part of engineering study and adequate including quarries quality. If funding should be allocated thereof. necessary, fund should be allocated for further investigations

Economic integration and regional Strong commitment and political will were Strong commitment and political will OPEV, POPR and Operations co-operation goals were partially met necessary to support cross-border's indicators need to be designed as Complex initiatives inputs to Economic Integration and Regional Co-operation Aggregate Index