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Ethiopia: Proposal for an Adf Loan of Ua 65,000,000 to Finance the Jima-Mizan Road Upgrading Project *

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Ethiopia: Proposal for an Adf Loan of Ua 65,000,000 to Finance the Jima-Mizan Road Upgrading Project * CONFIDENTIAL AFRICAN DEVELOPMENT FUND ADF/BD/WP/2006/141 08 November 2006 Prepared by: OINF Original: English Probable Date of Board Presentation FOR CONSIDERATION TO BE DETERMINED MEMORANDUM TO : THE BOARD OF DIRECTORS FROM : Modibo I. TOURE Secretary General SUBJECT : ETHIOPIA: PROPOSAL FOR AN ADF LOAN OF UA 65,000,000 TO FINANCE THE JIMA-MIZAN ROAD UPGRADING PROJECT * Please find attached a copy of the Appraisal Report on the above-mentioned project. The Loan agreement is being negotiated. The Outcome of Negotiations and draft Resolution will be submitted to you, for approval, once the negotiations are completed. Attach: Cc: The President * Questions on this document should be referred to: Mr. G. MBESHERUBUSA Director OINF Extension 2034 Mr. J. RWAMABUGA Manager OINF.2 Extension 2181 Mr. M. O. AJIJO Principal Transport Economist OINF.2 Extension 3110 Mr. N. KULEMEKA Principal Social Economist OINF.2 Extension 2336 Mr. A. BABALOLA Senior Transport Engineer OINF.2 Extension 2525 Mr. E. ALEMSEGED Infrastructure Specialist ETFO Extension 3863 SCCD: G .G. AFRICAN DEVELOPMENT FUND Language: English Original: English Distribution: Limited CONFIDENTIAL FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA JIMA-MIZAN ROAD UPGRADING PROJECT APPRAISAL REPORT This report is made available to staff members to whose work it relates. Any further release must be authorized by the Vice-President for Operations. INFRASTRUCTURE DEPARTMENT OINF TRANSPORT DIVISION.2 AUGUST 2006 SCCD: G .G. TABLE OF CONTENTS Page PROJECT INFORMATION SHEET, CURRENCY AND MEASURES, (i-xi) LIST OF TABLES, LIST OF ANNEXES, LIST OF ABBREVIATIONS, BASIC PROJECT DATA, PROJECT LOGICAL FRAMEWORK, EXECUTIVE SUMMARY 1. ORIGIN AND HISTORY OF THE PROJECT 1 2. THE TRANSPORT SECTOR 2 2.1 Sector Overview 2 2.2 Transport System 2 2.3 Bank Group Contribution to Transport Sector 3 2.4 Transport Policy, Planning and Coordination 4 3. THE ROAD SUB-SECTOR 5 3.1 Road Network, Vehicle Fleet and Network Traffic 5 3.2 The Road Transport Industry 5 3.3 Road Administration and Training 7 3.4 Road Planning, Financing and RSDP 8 3.5 Road Engineering and Construction 9 3.6 Road Maintenance 10 4. THE PROJECT 13 4.1 Project Concept and Rationale 13 4.2 Project Area and Project Beneficiaries 14 4.3 Strategic Context 16 4.4 Project Objectives 16 4.5 Project Description 16 4.6 Traffic and Road User/Agency Unit Prices 17 4.7 Environmental and Social Impact 19 4.8 Project Costs 22 4.9 Sources of Finance and Expenditure Schedule 23 5. PROJECT IMPLEMENTATION 25 5.1 Executing Agency 25 5.2 Institutional Arrangements 26 5.3 Supervision and Implementation Schedule 27 5.4 Procurement Arrangements 27 5.5 Disbursement Arrangements 29 5.6 Monitoring and Evaluation 29 5.7 Financial Reporting and Auditing 29 5.8 Aid Co-ordination 30 6. PROJECT SUSTAINABILITY AND RISKS 30 6.1 Recurrent Costs 30 6.2 Project Sustainability 30 6.3 Critical Risks and Mitigation Measures 31 7. PROJECT BENEFITS 32 7.1 Economic Analysis 32 7.2 Social Impact Analysis 33 7.3 Sensitivity Analysis 33 8. CONCLUSIONS AND RECOMMENDATIONS 34 8.1 Conclusions 34 8.2 Recommendations and Conditions of Loan Approval 34 This Appraisal Report was prepared by Messrs. M.O. AJIJO (Principal Transport Economist, Ext. 3110), A. BABALOLA (Senior Transport Engineer, Ext. 2525), and N. Kulemeka (Principal Social Economist, Ext. 2336) and E. Alemseged (Infrastructure Specialist, ETFO) following their mission to Ethiopia in August 2006. Any inquiries relating to this report may be referred to either the authors or to Mr. J. RWAMABUGA, Manager, OINF.2, Ext. 2181 or to Mr. G.MBESHERUBUSA Director, OINF, Ext. 2034. i AFRICAN DEVELOPMENT FUND Temporary Relocation Agency BP 323 1002 Tunis Belvedere, Tunis, Tunisia Tel: (216) 7110 2040 Fax: (216) 7133 3680 PROJECT INFORMATION SHEET The information given hereunder is intended to provide some guidance to prospective suppliers, contractors and consultants and to all persons interested in the procurement of goods and services for project approved by the Board of Directors of the Bank Group. More detailed information and guidance should be obtained from the Executing Agency of the Recipient. 1. COUNTRY : Ethiopia 2. PROJECT TITLE : Jima-Mizan Road Upgrading Project 3. LOCATION : Oromiya Regional State and Southern Nations, Nationalities and Peoples (SNNP) Regional State of Ethiopia 4. BORROWER : Federal Democratic Republic of Ethiopia 5. EXECUTING AGENCY : Ethiopian Roads Authority (ERA) P.O. Box 1770 Addis Ababa - Ethiopia Tel: (251) 1 156603 Fax: (251) 1 514866 E. Mail: [email protected] 6. DESCRIPTION : The project consists of: (a) Construction works for upgrading the existing 227.18-km gravel road to asphalt concrete surfaced standard with a 7.0-m carriageway and 1.5-m shoulder on either side from Jima in Oromiya Region State to Mizan in the Southern Nations, Nationalities and Peoples Region State. (b) Consultancy services for i) supervision of the civil works and ii) Project Audit. (c) Resettlement/payment of compensation to affected population. 7. TOTAL COST : UA 101.53.million i) Foreign Exchange : UA 75.16 million ii) Local Cost : UA 26.37 million ii 8. BANK GROUP LOAN ADF : UA 65.00 million 9. OTHER SOURCE OF FINANCE GOE : UA 36.53 million 10. DATE OF APPROVAL : December 2006 11. ESTIMATED STARTING : January 2008 – 36 months DATE OF PROJECT AND DURATION 12. PROCUREMENT OF : The civil works contract will be packaged in GOODS AND WORKS two lots to be procured under International Competitive Bidding (ICB) procedures, with Prequalification of contractors, and a regional preference margin. 13. CONSULTANCY SERVICES : Consultancy services for supervision of civil REQUIRED AND STAGE works will be acquired on the basis of two OF SELECTION shortlists of qualified consulting firms one for each lot of civil works. : Project audit services will be procured on the basis of a Short list of auditing firms 1 SDR = UA 1 1 UA = US$ 1.45480 (August, 2006) 1 UA = ETB 12.5182 (August, 2006) iii CURRENCY AND MEASURES Currency Equivalents (August 2006 Exchange Rates) Currency Unit = Ethiopian Birr (ETB) 1 UA = ETB 12.5182 1 UA = US$ 1.45486 1 USD = ETB 8.6044 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) = 0.386 square mile 1 hectare (ha) = 0.01 km2 = 2.471 acres 1 quintal = 100 kg FISCAL YEAR July 7- July 6 LIST OF TABLES Table 3.1 : Road Sector Maintenance & Capital Expenditure Table 3.2 : Road Fund Revenue and Regular Budget Allocation Table 3.3 : RSDP II – Physical Accomplishments by Type of Intervention Table 3.4 : Road Sector Maintenance and Capital Expenditures Table 3.5 : Road Fund Revenue and Regular Budget Allocation Table 3.6 : Road Maintenance Needs Versus Road Fund Revenue Table 4.1 : Base Year (2005) Motorized Traffic Table 4.2 : Summary of Project Cost Estimates by Components Table 4.3 : Summary of Project Cost by Category of Expenditure Table 4.4 Summary of Category of Expenditure by Sources of Finance Table 4.5 : Sources of Finance for ADF Component Table 4.6 : Expenditure Schedule by Components Table 4.7 : Expenditure Schedule by Source of Finance Table 5.1 : Summary of Project Implementation Schedule Table 5.2 : Summary of Procurement Arrangements LIST OF ANNEXES ANNEX Titles 1. Project Location Map 2. Ethiopian Roads Authority Organization Chart 3. Project Implementation Schedule 4. Provisional List of Goods and Services 5. Summary RSDP Financing and Project Economic Analysis 6. Summary of Bank Group Operations as of August 2006 7. List of Annexes in Project Implementation Document iv LIST OF ABBREVIATIONS AADT = Annual Average Daily Traffic ADB = African Development Bank ADF = African Development Fund BADEA = Arab Bank for Economic Development for Africa BCR = Benefit Cost Ratio CAA = Civil Aviation Authority CBO = Community Based Organization CBR = California Bearing Ratio CSP = Country Strategy Paper DCI = Development Cooperation Ireland DED = District Engineering Division DfID = Department for International Development (U.K.) DMO = District Maintenance Organization DRMC = District Road Maintenance Contractor EAL = Ethiopian Airlines EDF = European Development Fund EIRR = Economic Internal Rate of Return EMSB = Environmental Monitoring and Safety Branch EPA = Environmental Protection Authority ERA = Ethiopian Roads Authority ERTTP = Ethiopian Rural Travel and Transport Program ESAL = Equivalent Standard Axle Load ESL = Ethiopian Shipping Lines ETB = Ethiopian Birr EU = European Union FE = Foreign Exchange FTA = Ethiopian Transport Authority FYRR = First Year Rate of Return GER = Gross Enrolment Rate GOE = Government of Ethiopia (Federal Democratic Republic of Ethiopia) GPN = General Procurement Notice GTZ = Deutsche Gereuschraft fur Technische Zusammenarbeit HDM IV = Highway Management and Development Tool (IV) HIV/AIDS = Human Immuno Virus/Acquired Immune Deficiency Syndrome ICB = International Competitive Bidding IDA = International Development Association (World Bank) IEC = Information, Education and Communication IFAD = International Fund for Agricultural Development IRI = International Roughness Index JICA = Japanese International Cooperation Agency kph = Kilometres Per Hour MDG = Millennium Development Goals MoFED = Ministry of Finance and Economic Development MoTC = Ministry of Transport and Communication MoWUD = Ministry of Works and Urban Development MTR = Mid-term Review NDF = Nordic Development Fund NGO = Non-Governmental Organization NMT = Non Motorized Transport NPV = Net
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