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World Bank Document 't a3, FILECO?X -RESTRICTED ReportNo. PTR-63a for use within the Bank and its qffiliated organizations. Public Disclosure Authorized This report was prepared They do not accept responsibility for its accuracy or completeness. The report may not be published nor may it be quoted as representing their views. INTERNATIONALBANK FOR RECONSTRUCTIONAND DEVELOPMENT INTERNATIONAL DEVELOPMENTASSOCIATION Public Disclosure Authorized APPRAISAL OF THE SECOND HIGHWAY PROJECT NIGER Public Disclosure Authorized December 21, 1970 Public Disclosure Authorized 'Iransportation Projects Department Jiirrency _ouivalents 2urrency Unit - CFA Franc (CFAF) C?AF 1 = US$0.0036 CFA? 278 = US$1.00 JVAF 1 million US$3,600 FJ.h5calYear: October 1 to September 30 lJeightsanid l,easures: Metric Metric : British/US equiv4lent 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 miles (mi) 7 square kilometer (kcm-) = 0.386 square miles (sq mi) 1 hectare (ha) - 2.47 acres (ac) 1 liter (1) = 0.22 British gallons (imp gal) = 0,26 US gallons (gai) 1 metric ton (m ton) = 2,204 pounds (lbs) Abbreviationsand Acronyms: B.JEOM - Bureau Central pour les Equipementsd'Outre-Mer - Commissariata l'EnergieAtomique CTDA - Canadian InternationalDeveloçment Agency DP4 - Directorateof Public Works FAC - Fonds d'Aide et de Cooperation FED - Fonds Europeen de Developpement OCON - Organisation Commune Dahomey-Niger SCET-COOP- Societe Centrale pour l'Equipement du Territoire-Cooperation 3EDEf3 - Societe d'Etudes pour le Developpement Economique et Social SN,4T1 - Societe Nationale des Transporteurs Nigeriens UIsAID - United States Agency for InternationalDevelopment GDP - Gross domesticproduct vpct - Vehiclesper day NIGER APPRAISAL OF THE SECOND HIGHWAY PROJECT TABLE OF CONTENTS Page No. SUMMARY AND CONCLUSIONS.i - i 1. INTRODUCTION ............................... 1 2. BACKGROUND .................. 2 A. Economic Setting ............................ 2 B. The Transport System .......................... 2 C. Transport Policy and Coordination .................. 3 3. THE HIGHWAY SECTOR .......................... 4 A. The Highway Network ......................... 4 B. Characteristics and Growth of Road Traffic ............. 4 C. Administration .............................. 5 D. Financing ................................. 6 E. Maintenance ...... ........................ 7 F. Engineering and Construction ..................... 7 G. Planning .................................. 8 4. THE PROJECT. 8 A. Description ................................ 8 B. The Niamey-Tillabery Road ....................... 8 C. The Magaria-Tinkim-Nigerian Border Road and the Dan Tyao-Tinkim Road .................... 9 D. Equipment ................................ 9 E. Consultants' Services ........................... 10 F. Feasibility Studies and Detailed Engineering ............. 10 G. Cost Estimates and Financing ..................... il H. Execution ................................. 12 5. ECONOMIC EVALUATION ......................... 12 A. General .................................. 12 B. Niamey-Tillabery Road ......................... 13 C. Magaria-Tinkim-Nigerian Border Road ................. 13 D. Dan Tyao-Tinkim Road ......................... 14 6. RECOMMENDATIONS ............................ 15 (Continued) This report was prepared by Messrs. Ludwig (Engineer), Yenny (Economist) and Rowat (Economist) and was edited by Miss J. Murphy. TABLE OF CONTENTS (Continued) Tables: I - Road Network 1970 2 - Comparison of Highway Densities 3 - Vehicle Fleet 4 - Road Transport Fuel Consumption 5 - Highway Expenditures 1967/68 - 1973/74 6 - Revenues from Road Users 7 - Government and IDA Participation in Project Costs 8 - Estimated Schedule of Disbursements 9 - Traffic Forecasts for Project Roads 10 - Maintenance Cost Functions Il - Estimated Vehicle Operating Costs Chart: Organization of the Directorate of Public Works Maps: 1 - Niger - Main Highway Network 2 - Niger - Outlets to the Sea 3 - Niger - Road Network in the Magaria Region NIGER APPRAISAL OF THE SECOND HIGHWAY PROJECT SUMMARY AND CONCLUSIONS i. Niger's economy is primarily dependent on agriculture and relies on the road network for the transport of its agricultural products between areas of production and consumption, and for export. Most economic activity in this immense territory takes place in the narrow, fertile belt in the south where 90o of the population lives. But distances are great between economic centers; the population is dispersed and transport is time-consuming and costly, representing a serious obstacle to expansion of the internal market. In addition, Niger's land-locked position far from world markets means high transport costs for both exports and imports. ii. The Bank Group has been assisting Niger in the transport sector since 1964 when IDA made a credit (55-NIR) of US$ 1.5 million equivalent to help finance the engineering and construction of two small roads in groundnut producing areas. A 1965 Bank technical assistance grant of US$85,000 for a road maintenance study led to a four-year maintenance program partly financed with another credit (128-NIR) in 1968. That credit, in the amount of US$6.12 million equivalent, also included road feasibility studies and detailed engineering on which the present project is based. Future investments in the transport sector should concentrate on increasing the efficiency of road transport through (a) improvement of existing internal links to meet increasing traffic demand, and (b) development of reliable and efficient export routes. The proposed project is designed to meet these objectives. iii. Under the project, three important roads will be constructed and improved. Paving of the trunk road from Niamey to Tillabery (115 km) will provide an all-weather connection between the capital and a rich agricultural area. The improvement of two short roads (totalling 34 km) in an important groundnut region will (a) provide the means for the area's production to be processed at an oil mill to be constructed at Magaria, and (b) link Magaria more directly with Kano in Nigeria, through which groundnut exports move to the port of Lagos. The project also includes the feasibility study and detailed engineering of a further 170 km of agricultural roads and the purchase of much needed laboratory and traffic counting equipment. iv. The credit of US$5.7 million equivalent will cover 71% of the total cost of the project, which is estimated at US$8.0 million equivalent. About 79% of the credit will finance the foreign exchange expenditures, estimated at US$4.5 million. The remaining US$ 1.2 million of the credit will finance part of the local currency expenditures. The Government will finance the remaining local costs, amounting to US$2.3 million equivalent, of which about US$2.0 million are taxes. (ià) v. The Directorate of Public Works will be responsible for execution of the project and will be assisted by consultants for the supervision of construction. The project, which will result in savings in vehicle operating costs and road maintenance costs, is expected to yield rates of return ranging from 10% to 23% for the individual roads. The overall rate of return for the project is 13%o. vi. The project is suitable for an IDA credit of US$5.7 million equivalent to the Government of Niger. NIGER APPRAISAL OF THE SECOND HIGHWAY PROJECT 1. INTRODUCTION 1.01 The proposed road construction project will be the third Bank Group lending operation in the transport sector of Niger. In 1964, an IDA credit (55-NIR) of US$1.5 million equivalent helped finance the engineering and construction of two small roads (totalling about 60 km) which serve groundnut export. The project has been satisfactorily completed. In 1965. the Bank made a technical assistance grant of US$85,000 for a road maintenance study which was undertaken by the French consulting firm, Bureau Central pour les Equipements d'Outre-Mer (BCEOM). IDA helped finance the capital costs of a four-year maintenance program based on the recommendations of that study with a credit (128-NIR, 1968) amounting to US$6.12 million equivalent. The maintenance program is currently being carried out by the Directorate of Public Works (DPW) with the assistance of BCEOM. 1.02 The maintenance project also included the feasibility study of about 300 km of roads and the completion of detailed engineering and bidding documents for construction of those road sections found to have the highest priority. The French consultants, Societe Centrale pour l'Equipement du Territoire-Cooperation (SCET-COOP), carried out the feasibility studies and selected, in agreement with the Association, three road sections (totalling about 150 km) for detailed engineering. The detailed engineering and bidding documents have been completed. 1.03 The Government has requested IDA financing for construction of these three roads, for the feasibility study and detailed engineering of an additional 170 km of roads in agricultural areas, and for the purchase of laboratory and traffic counting equipment. The total cost of the project is estimated at US$8.0 million equivalent. IDA will finance the foreign exchange component amounting to US$4.5 million equivalent and part of the local costs in the amount of US$1.2 million equivalent. The credit of US$5.7 million will therefore cover 71% of the total project costs. 1.04 The Government also requested IDA financing for the detailed engineering and construction of a fourth road studied under Credit 128-NIR. The Association found, however, that there was insufficient traffic to justify
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