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World Bank Document Document of The World Bank Public Disclosure Authorized FOR OFFICIAL USE ONLY Report No: 56919-BY PROJECT APPRAISAL DOCUMENT ON A Public Disclosure Authorized PROPOSED LOAN IN THE AMOUNT OF US$150.0 MILLION TO THE REPUBLIC OF BELARUS FOR A ROAD UPGRADING AND MODERNIZATION PROJECT Public Disclosure Authorized October 13, 2010 Environmentally and Socially Sustainable Development Sector Unit Europe and Central Asia Region Public Disclosure Authorized This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective May 22, 2010) Currency Unit = Belarusian Ruble (BYR) BYR 2,995 = US$1.00 US$1.537 = SDR1.00 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS AADT Annual Average Daily Traffic IBRD International Bank for Reconstruction and Development AMF Accident Modification Factor IDA International Development Association BEEPS Business Environment and Enterprise IFI International Financial Institutions Performance Survey BP Bank Policy IFR Intermediate Financial Reports BELAVTODOR Department on Roads, Ministry of IMF International Monetary Fund Transport and Communications BELDORNII Belarus Road Research Institute KRU Control and Revision Department of the Ministry of Finance BELDORCENTER Belarus Road Center MA-C Minskavtodor-Center BELGIPRODOR Republican Unitary Enterprise for MoTC Ministry Of Transport and Civil Engineering Research and Communications Design of Highways, Airfields, and Bridgework CAS Country Assistance Strategy MNREP Ministry of Nature Resources and Environmental Protection CHP Combined Heat and Power NGO Non-Governmental Organization CIS Commonwealth of Independent States NIP National Implementation Plan CPS Country Partnership Strategy NPV Net Present Value DPL Development Policy Loan OP Operational Policy EA Environmental Assessment PDO Project Development Objective EBRD European Bank for Reconstruction PEFA Public Expenditure and Finance and Development Accountability EIA Environmental Impact Assessment PIT Project Implementation Team EIRR Economic Internal Rate of Return POM Project Operational Manual EMP Environmental Management Plan POPs Persistent Organic Pollutants ESM Environmentally Sound Management ROW Right of Way EU European Union RUE Republican Unitary Enterprise FDI Foreign Direct Investment SBD Standard Bidding Documents FM Financial Management SCC State Control Committee FSU Former Soviet Union SEE State Ecological Expertise GDP Gross Domestic Product SMA Stone Mastic Asphalt GEF Global Environmental Facility SOE State-Owned Enterprises GNI Gross National Income TCEP Technical Code of Excellent Practice HDM 4 Highway Development and TOR Terms of Reference Management Model HGV Heavy Goods Vehicle Vpd Vehicles per Day ICB International Competitive Bidding VSL Variable Spread Loan WB World Bank Vice President: Philippe H. Le Houerou, ECAVP Country Director: Martin Raiser, ECCU2 Sector Manager: Henry G.R. Kerali, ECSSD Task Team Leader: Andreas Schliessler, ECSSD BELARUS Road Upgrading and Modernization Project CONTENTS Page I. STRATEGIC CONTEXT AND RATIONALE ................................................................. 1 A. Country and sector issues.................................................................................................... 1 B. Rationale for Bank involvement ......................................................................................... 6 C. Higher level objectives to which the project contributes .................................................... 6 II. PROJECT DESCRIPTION ................................................................................................. 6 A. Lending instrument ............................................................................................................. 6 B. Project development objective and key indicators .............................................................. 7 C. Project components ............................................................................................................. 7 D. Lessons learned and reflected in the project design ............................................................ 8 E. Alternatives considered and reasons for rejection .............................................................. 9 III. IMPLEMENTATION ...................................................................................................... 9 A. Institutional and implementation arrangements .................................................................. 9 B. Monitoring and evaluation of outcomes/results ................................................................ 10 C. Sustainability..................................................................................................................... 10 D. Critical risks and possible controversial aspects ............................................................... 10 E. Loan conditions and covenants ......................................................................................... 13 IV. APPRAISAL SUMMARY ............................................................................................. 13 A. Economic analysis ............................................................................................................ 14 B. Technical ........................................................................................................................... 15 C. Fiduciary ........................................................................................................................... 15 D. Social................................................................................................................................. 16 E. Environment ...................................................................................................................... 18 F. Safeguard policies ............................................................................................................. 19 G. Policy exceptions and readiness ........................................................................................ 20 Annex 1: Country and Sector or Program Background ......................................................... 21 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ................. 29 Annex 3: Results Framework and Monitoring ........................................................................ 31 Annex 4: Detailed Project Description ...................................................................................... 33 Annex 5: Project Costs ............................................................................................................... 41 Annex 6: Implementation Arrangements ................................................................................. 42 Annex 7: Financial Management and Disbursement Arrangements ..................................... 46 Annex 8: Procurement Arrangements ...................................................................................... 54 Annex 9: Economic Analysis ...................................................................................................... 62 Annex 10: Safeguard Policy Issues ............................................................................................ 69 Annex 11: Project Preparation and Supervision ..................................................................... 76 Annex 12: Documents in the Project File ................................................................................. 77 Annex 13: Statement of Loans and Credits .............................................................................. 78 Annex 14: Belarus at a Glance ................................................................................................... 79 Annex 15: Map BLR37573 ......................................................................................................... 81 BELARUS ROAD UPGRADING AND MODERNIZATION PROJECT PROJECT APPRAISAL DOCUMENT EUROPE AND CENTRAL ASIA ECSSD Date: October 13, 2010 Team Leader: Andreas Schliessler Country Director: Martin Raiser Sectors: Roads and highways (100%) Sector Manager/Director: Henry G. R. Kerali Themes: Regional integration (50%); Export development and competitiveness (50%) Project ID: P118375 Environmental category: Full Assessment Lending Instrument: Specific Investment Loan Joint IFC: No Project Financing Data [X] Loan [ ] Credit [ ] Grant [ ] Guarantee [ ] Other: For Loans/Credits/Others: Total Bank financing (US$m.): 150.00 Proposed terms: Flexible Loan at 6 months Libor for US Dollars plus variable spread, with a 15 year maturity, including 5 year grace period, commitment linked and with level repayment pattern. Financing Plan (US$m) Source Local Foreign Total Borrower 00.00 0.00 00.00 International Bank for Reconstruction and 66.00 84.00 150.00 Development Total: 66.00 84.00 150.00 Borrower: Republic of Belarus Responsible Agency: Minskavtodor-Center (MA-C) Minsk Belarus Tel: (+375) 17 259 8447 [email protected] Estimated disbursements of proposed Loan (Bank FY/US$m) FY 2011 2012 2013 2014 Annual 15.00 60.00 55.00 20.00 Cumulative 15.00 75.00 130.00 150.00 Project implementation period: Start: February 28, 2011 End: June 30, 2014 Expected effectiveness date: February 28, 2011 Expected closing date: November 30, 2014 Does the project depart from the CAS in content or other significant respects? [ ]Yes [X] No Ref. PAD
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