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The World Bank for OFFICIAL USE ONLY Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No: 59825 PROJECT PAPER ON A PROPOSED ADDITIONAL CREDIT IN THE AMOUNT OF SDR 47.4 MILLION Public Disclosure Authorized (US$75 MILLION EQUIVALENT) TO THE REPUBLIC OF UGANDA FOR A TRANSPORT SECTOR DEVELOPMENT PROJECT Public Disclosure Authorized May 14, 2011 Transport Sector Country Department AFCE1 Africa Region 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 Public Disclosure Authorized World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective March 31, 2011) Currency Unit = Uganda Shilling (UGX) US$1 = UGX 2403 US$1 = SDR 0.6307 FISCAL YEAR July 1 – June 30 ABBREVIATIONS AND ACRONYMS AF Additional Financing AfDB African Development Bank CAS Country Assistance Strategy CC Contracts Committee CoST Construction Sector Transparency CPI Corruption Perception Index DBST Double Bituminous Surface Dressing DFID Department for International Development, UK DRC Democratic Republic of Congo ED Executive Director EIA/SIA Environmental Impact Assessment/Social Impact Assessment EIRR Economic Internal Rate of Return EU European Union FM Financial Management GAAP Governance and Accountability Action Plan GAC Governance and Anti-Corruption GoU Government of Uganda HDM-4 Highway Development and Management Model Version Four ICB International Competitive Bidding IDA International Development Association IG Inspectorate of Government IPBE Independent and Parallel Bid Evaluation IPR Independent Procurement Review ISIES Institutional Support and Integrity Enhancement Service Km Kilometer KNP Kibale National Park M&E Monitoring and Evaluation MATA Metropolitan Area Transport Authority MIS Monitoring and Information System MoFPED Ministry of Finance, Planning and Economic Development MoWT Ministry of Works and Transport NCB National Competitive Bidding NDF Nordic Development Fund MUBFS Makerere University Biological Field Station NDP National Development Plan NPV Net Present Value NTPS National Transport Policy and Strategy OAG Office of the Auditor General PAP Project Affected Persons PDO Project Development Objective PDU Procurement and Disposal Unit PE Procuring Entities PPDA Public Procurement and Disposal of Public Assets Authority PS Permanent Secretary QCBS Quality and Cost Based Selection RAI Rural Access Index RAP Resettlement Action Plan RPM Regional Procurement Management SDR Standard Drawing Rights SIL Specific Investment Loan TA Technical Assistance TSDP Transport Sector Development Project UNRA Uganda National Roads Authority VOC Vehicle Operating Cost WB World Bank Vice President: Obiageli K. Ezekwesili Country Director: John Murray McIntire Country Manager: Kundhavi Kadiresan Sector Manager: Supee Teravaninthorn Task Team Leader: Labite Victorio Ocaya REPUBLIC OF UGANDA TRANSPORT SECTOR DEVELOPMENT PROJECT CONTENTS Project Paper Data Sheet .................................................................................................................. i I. Introduction ................................................................................................................................. 1 II. Background and Rationale for Additional Financing in the amount of US$75 million ............ 1 III. Proposed Changes ..................................................................................................................... 5 IV. Appraisal Summary. ................................................................................................................. 8 Annex 1: Revised Results Framework and Monitoring Indicators .............................................. 12 UGANDA TRANSPORT SECTOR DEVELOPMENT PROJECT ADDITIONAL FINANCING DATA SHEET Basic Information - Additional Financing (AF) Country Director: John McIntire Country Manager: Kundhavi Kadiresan i Project Development Objective and Description Original project development objective: The project's development objective is to improve the connectivity and efficiency of the transport sector through: (i) improved condition of national road network, (ii) improved capacity for road safety management; and (iii) improved transport sector and national road management. Revised project development objective: The PDO for the proposed Additional Financing (AF) will remain the same as for Transport Sector Development Project (TSDP). Project description: Component A: Upgrading and Rehabilitation of the: (i) Gulu-Atiak (74 km), (ii) Vurra-Arua-Oraba (85 km) and (iii) the Kamwenge-Fort Portal (66 km) roads, to Bitumen Standard; Component B: Enhanced Road Safety including the establishment of National Road Safety Authority (NRSA) and making the crash data base operational; Component C: The preparation of Kampala Urban Transport Project, and the legislation and establishment of the Metropolitan Area Transport Authority (MATA); Component D: Support to the Ministry of Works and Transport (MoWT) to focus on its core function of policy setting, strategic planning, sector oversight and monitoring and to spin off some of its responsibilities to newly created entities under its umbrella; and Component E: Strengthening the capacity of the Uganda National Roads Authority (UNRA) to serve as a project implementing unit, through the refurbishing of offices, provision of technical assistance including technical assistance for strengthening the internal audit functions of UNRA, the carrying out of studies, and the provision of training and equipment. The proposed AF is expected to fund the following activities: 1. Component A: Scale-up: Upgrading and Rehabilitation of the Kamwenge-Fort Portal road (66 km) to Bitumen Standard. This road forms part of the national road Nyakahita-Kazo-Ibanda-Kamwenge-Fort Portal (209 km) and connects western Uganda to the Northern Corridor and the Trans-Africa Highway 2. Component E: Technical assistance for strengthening the internal audit functions of UNRA for technical audits of road projects. ii Safeguard and Exception to Policies Safeguard policies triggered: Environmental Assessment (OP/BP 4.01) [X] Yes [ ] No Natural Habitats (OP/BP 4.04) [X] Yes [ ] No Forests (OP/BP 4.36) [X] Yes [ ] No Pest Management (OP 4.09) [ ] Yes [X] No Physical Cultural Resources (OP/BP 4.11) [X] Yes [ ] No Indigenous Peoples (OP/BP 4.10) [ ] Yes [X] No Involuntary Resettlement (OP/BP 4.12) [X] Yes [ ] No Safety of Dams (OP/BP 4.37) [ ] Yes [X] No Projects on International Waters (OP/BP 7.50) [ ] Yes [X] No Projects in Disputed Areas (OP/BP 7.60) [ ] Yes [X] No Does the project require any waivers of Bank policies? [X] Yes [ ] No Have these been endorsed or approved by Bank management? [X] Yes [ ] No Conditions and Legal Covenants: Financing Agreement Description of Condition/Covenant Date Due Reference Amendment Letter for One fully executed original of this Within 90 days from the Additional Financing amendment letter; signing of the Amendment – Chapter II – Letter. Paragraph 1 (a) Amendment Letter for A revised Subsidiary Grant Agreement Within 90 days from the Additional Financing between the Recipient and UNRA signing of the Amendment – Chapter II – reflecting the amount of the Additional Letter. Paragraph 1 (b) Financing; Amendment Letter for A legal opinion satisfactory to the Within 90 days from the Additional Financing Association, showing that (i) this signing of the Amendment – Chapter II – amendment letter has been duly authorized Letter. Paragraph 1 (c) (i) or ratified by, and executed and delivered on behalf of, the Recipient, and is legally binding on the Recipient; and Amendment Letter for The revised Subsidiary Grant Agreement Within 90 days from the Additional Financing has been duly authorized or ratified by the signing of the Amendment – Chapter II – Recipient and UNRA, and is legally Letter. Paragraph 1 (c) (ii) binding on the Recipient and UNRA in accordance with its terms. iii I. Introduction 1. This Project Paper seeks the approval of the Executive Directors to provide an additional credit in an amount of Special Drawing Rights (SDR) 47.4 million (US$75.0 million equivalent) to the Republic of Uganda for the Transport Sector Development Project (TSDP), Credit 4679- UG). 2. The proposed additional financing (AF) would finance project scale-up under Component A of the TSDP (upgrading and rehabilitation of national roads) through the paving of the Kamwenge-Fort Portal road (66 km). This road forms part of the national road Nyakahita-Kazo- Ibanda-Kamwenge-Fort Portal (209 km) and connects western Uganda to the Northern Corridor and the Trans-Africa Highway. It passes through an area of high agricultural potential, ideal for the production of food and cash crops and animal farming. The AF will also provide technical assistance to strengthen the internal audit functions of Uganda National Roads Authority (UNRA) for technical audits of road projects (Component E). 3. Partnership arrangements: The original project (Cr. 4679-UG) includes the provision of technical assistance financed by the development partners of European Union (EU) and the Department for International Development, UK (DFID). The Environmental Impact Assessment/Social Impact Assessment (EIA/SIA) and Resettlement Action Plan (RAP) for the road have been prepared with financing from the African Development Bank (AfDB). The International Development Association (IDA) is partnering with the AfDB to finance the entire 209 km with AfDB covering the first 143 km section and
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