INTEGRATED SAFEGUARDS DATA SHEET RESTRUCTURING STAGE Note: This ISDS will be considered effective only upon approval of the project restructuring Report No.: ISDSR1044

Public Disclosure Authorized Date ISDS Prepared/Updated: 12-Jan-2015 Date ISDS Approved/Disclosed: 13-Jan-2015 I. BASIC INFORMATION

Public Disclosure Copy 1. Basic Project Data

Country: China Project ID: P118647 Project Name: China: Anhui Shaying River Channel Improvement Project (P118647) Task Team Reda Hamedoun Leader(s): Estimated 24-Aug-2010 Estimated 12-Apr-2011

Public Disclosure Authorized Appraisal Date: Board Date: Managing Unit: GTIDR Lending Sector Investment and Instrument: Maintenance Loan Sector: Ports, waterways and shipping (99%), Public administration- Water, sanitation and flood protection (1%) Theme: Other rural development (30%), Infrastructure services for private sector development (30%), Water resource management (30%), Climat e change (10%) Is this project processed under OP 8.50 (Emergency Recovery) or OP 8.00 (Rapid Response to Crises and No Emergencies)? Financing (in USD Million) Public Disclosure Authorized Total Project Cost: 291.14 Total Bank Financing: 100.00 Financing Gap: 0.00 Financing Source Amount

Public Disclosure Copy Borrower 191.14 International Bank for Reconstruction and Development 100.00 Total 291.14 Environmental A - Full Assessment Category: Is this a No Repeater project? Public Disclosure Authorized 2. Current Project Development Objectives The development objectives of the proposed project would be: (a) to increase the carrying capacity; (b) to improve the efficiency; and (c) to reduce the adverse

Page 1 of 13 environmental impact of the IWT infrastructure that serves the industries of th e Shaying River Basin.

The immediate transport benefits of the Project will be to overcome capacity bottlenecks in the IWT system and reduce the average costs of transport in the corr idor. These benefits will, in the medium and long-term, also boost the regional economic development of the affected hinterlands in Anhui and Henan, mainly thro ugh facilitating the exploitation and economical transport of coal and other bul k goods to industrial areas of demand in the Yangtze Delta.

Public Disclosure Copy Proposed New PDO (from Restructuring Paper) The development objectives of the proposed project would be: (a) to increase the carrying capacity; (b) to improve the efficiency; and (c) to reduce the adverse environmental impact of the IWT infrastructure that serves the industries of th e Shaying River Basin.

The immediate transport benefits of the Project will be to overcome capacity bottlenecks in the IWT system and reduce the average costs of transport in the corr idor. These benefits will, in the medium and long-term, also boost the regional economic development of the affected hinterlands in Anhui and Henan, mainly thro ugh facilitating the exploitation and economical transport of coal and other bul k goods to industrial areas of demand in the Yangtze Delta. 3. Project Description Project Description. The Project will re-open and upgrade the 205.6 km long Shaying River channel between Changshenggou on the Henan-Anhui border and Mohekou at the confluence of the Shaying River with the Huai River. The improvement works will raise the standard of the channel and associated infrastructure to national standard Class IV, which will permit year-round navigation of laden or unladen powered vessels of 500 dwt. The Project consists of the following four main components:

Component 1 – Navigation Infrastructure and Facilities. This component includes river channelization and dredging works, river bank strengthening and protection works, and provision of navigation aids and service facilities.

Public Disclosure Copy Component 2 – Reconstruction and Relocation of Existing Infrastructure and Facilities. This component includes reconstruction and reinforcement of existing cross-river bridges that have insufficient clearance and relocation of other existing cross-river facilities that impede navigation.

Component 3 – Erection of Waterway Transport Management Systems. This component includes provision and installation of the plants and equipment which are needed for building the management systems to be developed by the two technical studies under Component D.

Component 4 – Technical Assistance. This component includes technical studies and training programs that are designed to build the institutional capacity of the IWT sector to enable sustainable IWT development in Anhui Province. The two technical studies are: (a) Shaying River Waterway Transport Management and Emergency Service System; and (b) Comprehensive Ship Lock Management System.

Page 2 of 13 Misprocurement. In a letter dated June 4, 2014, the Bank declared misprocurement in the cases of two contracts (HD-01: waterway improvement works on 40km, and QL-01: bridge modification works). In parallel, the Bank also concluded that the violation may have resulted from a genuine misunderstanding and misinterpretation of the conflict of interest clause in the bidding documents and, therefore, the Bank consented to not cancel the Loan funds allocated to the contracts under the Loan Agreement.

Addition of two ship locks under the proposed restructuring. The Ministry of Finance of China (MOF) requested, in a letter dated April 21, 2014, to use unallocated funds (from the misprocured contracts as well as savings from lower bidding price) to finance part of the cost of two new ship Public Disclosure Copy locks in Yingshang and Yangqiao. Civil works of the two new ship locks will be added to Component 2. The proposed locks will relieve capacity constraints on existing infrastructure and therefore advance the project in achieving its PDO: “to contribute to the increased cargo throughput of the Shaying River in Anhui Province through infrastructure improvements and capacity building”.

• Second Yingshang lock: traffic through the existing Yingshang lock has reached 7 million tons/year, which is challenging its nominal design capacity of 6 million tons/year. The sharp traffic growth has created an emerging bottleneck at Yingshang lock, which is the key lock for IWT access to Fuyang City. It is therefore proposed to build a second lock, adjacent to the existing one, with a capacity of 12 million tons/year.

• Yangqiao lock: the increase of IWT traffic has created the opportunity to extend the effective Shaying waterway network to Linquan County. The existing Yangqiao lock’s capacity is too low to accommodate this increase. On the banks of the Quan River, road trucks that carry various materials load and discharge directly into barges moored up in ranks immediately downstream of Yangqiao lock as they are unable to proceed further upriver. It is therefore proposed to upgrade and expand the existing ship lock. 4. Project location and salient physical characteristics relevant to the safeguard analysis (if known) The Shaying River, a major tributary of the Huai River in central China, originates from Henan Province and converges with the Huai River in Anhui Province. The total length of the Shaying River is 620 km, of which 206 km flows through Anhui Province. The proposed Project aims to improve 205.6 km long river channel within Fuyang City, Anhui Province. The project area is mainly flat alluvial plain, with intensive farmland cultivation.

Public Disclosure Copy There is an existing Yingshang ship lock on Shaying River in Yingshang County of Fuyang City. The proposed second Yingshang ship lock, as part of the project restructuring, will be located in parallel to the existing Yingshang ship lock.

The Quan River (also called Fenquan River) is a tributary of Shaying River. It originates from Henan Province and converges with the Shaying River in Sanliwan of Fuyang City. The total length of Quan River is about 241km, of which 82km flows through Anhui Province. The Quan River has undergone dredging and channeling for flood prevention purpose since 1950’s. As a result, it currently has a width of 25-30m, with a regular depth of 3.5-4m that allows navigation of 500-1000 dwt ships. However, the existing Yangqiao ship lock, located in Linquan County of Fuyang City, was built in 1980’s and allows navigation of 100 dwt ships only. Expanding the capacity of Yangqiao ship lock will make the ship lock match the existing navigation capacity of Quan River.

Page 3 of 13 Construction at Yangqiao lock will affect local people’s livelihoods, as 10 people from 4 households will be resettled and 0.6 mu of land will be taken. A simplified Resettlement Action Plan (RAP) has been prepared and locally disclosed on August 28, 2014. Construction at the second Yingshang lock will require three pieces of land for temporary use as spoil disposal sites. The land will be restored to arable land and handed over to the local communities after use. Compensation will be provided during project use based on local land productivity. One state-owned enterprise, Yingshang Ship Lock Management Company, will be resettled and move to another place where they own the land. The cost of resettlement will be accounted within its mother company. A RAP has been prepared and will be disclosed locally before the end of December 2014, and the English version of the RAP will be disclosed at InfoShop. Public Disclosure Copy 5. Environmental and Social Safeguards Specialists Aimin Hao (GSURR) Ning Yang (GENDR)

6. Safeguard Policies Triggered? Explanation (Optional) Environmental Yes Assessment OP/BP 4.01 Natural Habitats OP/BP Yes 4.04 Forests OP/BP 4.36 No Pest Management OP 4.09 No Physical Cultural No Resources OP/BP 4.11 Indigenous Peoples OP/ No BP 4.10 Involuntary Resettlement Yes OP/BP 4.12 Safety of Dams OP/BP No 4.37 Projects on International No Waterways OP/BP 7.50 Projects in Disputed No Public Disclosure Copy Areas OP/BP 7.60

II. Key Safeguard Policy Issues and Their Management A. Summary of Key Safeguard Issues 1. Describe any safeguard issues and impacts associated with the Restructured project. Identify and describe any potential large scale, significant and/or irreversible impacts: Environmental:

The project restructuring proposes to add two ship locks: (i) the second Yingshang ship lock on Shaying River; and (ii) the Yangqiao ship lock on Quan River, a tributary of the Shaying River. EIAs were conducted for the two ship locks. The project EA category and triggered safeguards policies remain unchanged. Main environmental issues are summarized below.

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The second Yingshang ship lock will be adjacent to the existing Yingshang ship lock on the Shaying River. Building the second ship lock has become a necessity given the fast increase of freight transport along the river in the past three years. The Yangqiao ship lock is located on the Quan River, a tributary of the Shaying River. The Quan River now allows for the navigation of 500-1000 dwt ships at regular water depth as the result of flooding prevention efforts made during 1998-2005. However the existing Yangqiao ship lock was built in the 1980s and can only accommodate 100 dwt ships. Currently, bigger size vessels have to load and unload goods at the Yangqiao Operations Area near the ship lock. Goods are then shipped by trucks.

Public Disclosure Copy Expanding the two ship locks will not result in any significant changes to depths or flow volume of the rivers during construction and operation. Therefore potential impacts on river ecology are considered to be very limited.

The remaining key environmental issues associated with the two new ship locks include:

• Soil erosion, water pollution and vegetation loss as a result of building or widening of channels under the ship locks; • Disposal of soils, spoils, and debris from channel cutting and dismantling of existing structures; • Social disturbance such as noise, dust and traffic blocking; • Waste management, safety issues during construction and operation. These environmental issues have been adequately addressed in the EIAs, and mitigation measures included in the EMPs to avoid or minimize the potential environmental impacts. By applying readily available construction technology and proper construction scheduling, potential impacts on water quality, loss of soils and vegetation, disturbance to local road traffic can be minimized. Post-construction re-vegetation and protection works will be carried out. Disposal sites for spoils have been identified and included in the EMP.

The project EMP implementation performance has been satisfactory. Regular field investigation and environmental monitoring show construction impacts have been well managed. Specifically, monitoring results of water quality, sediment quality, and soil quality show that dredging, river bank cutting, and disposal of silts activities have not resulted in significant impacts to water quality of the river and soil quality in the vicinity of the disposal sites.

Public Disclosure Copy Field investigation shows that construction practices have followed EMP requirements to minimize impacts on the natural environment and local communities. The monitoring, supervision, and awareness raising programs have been implemented following EMP requirements by the project owner, supervision engineers and contractors. The Project originally included channelization, dredging, river bank works along Shaying River and removal and reconstruction of several bridges on the river. The project was categorized as Category A. OP4.01 and OP4.04 were triggered because the Project will have the potential to cause direct, indirect or cumulative impacts to the social and natural environment. The project was prepared during 2009-2010 and has been under implementation for 42 months.

Potential adverse impacts are primarily related to:

• River ecology, water quality, and soil quality issues associated with Shaying River channelization, dredging, and river bank works (Component 1);

Page 5 of 13 • Soil erosion, construction waste management, social disturbance associated with dismantling and construction/reconstruction of several bridges on Shaying River, the two ship locks, etc. (Component 2); • Other impacts during construction and operation.

The project area has been subject to intensive human activities for a long time. Ecological surveys along the Shaying River, Quan River and other relevant rivers were conducted through desk review, field investigation and consultation with local authorities, institutes and communities. They show that artificial ecosystems such as farmland, artificial woodland and urban area is prevalent throughout the project area. No nature reserves, forest parks nor scenic areas at any level Public Disclosure Copy of protection are located in the project area. The Anhui Taihe Shaying River National Wetland Park is located along the Shaying River in Taihe County. River, farmland and artificial woodland are currently prevalent in the Park. The purpose of establishing the Park is to promote the rehabilitation of the already degraded ecological environment. The establishment of the wetland park was announced during the Project preparation in late 2009. In response to the change, the Project design was refined to meet relevant national wetland park management regulation. As a result, one river bank cutting within the wetland park was cancelled. Special consultation with the Park management was carried out regarding the project activities. Approval was later obtained from the wetland park management authority (Taihe County Forestry Bureau). Overall, the Project, including newly added activities, is not anticipated to cause significant conversion or degradation of natural habitats in the project area.

Social: Involuntary Resettlement (OP/BP 4.12). The construction of the Yangqiao ship lock will cause minor land acquisition and resettlement in the Laojie village of Yangqiao. A total of 0.6 mu of land originally allocated for house building will be taken. Also, houses of 4 households (10 people) with a total area of 190 square meters will have to be demolished. These households will be compensated according to local standards and their livelihoods will be restored to the original level or better. During construction, a temporary road will be provided to reduce negative impacts on local communities. A total of 150 mu of national land will be used temporarily.

Construction at the second Yingshang lock will use three pieces of land for temporary spoil disposal, and one state-owned-enterprise will be resettled. Compensation will be provided for the period land is occupied by the project, and after use the land will be restored to arable land and Public Disclosure Copy returned to the local community. Resettlement of the state-owned-enterprise does not affect local people’s livelihoods, and the company will relocate to another place where it owns the land. The cost of this resettlement will be accounted within it mother company. A RAP has been prepared and will be disclosed locally by the end of December 2014, and will also be disclosed at InfoShop. The Project will benefit the rural and urban residents along the river basin by improving transport and the local economy. On the other hand, land occupation, house and structure demolition, bridge reconstruction, sludge disposal, etc. will cause potential adverse impacts on the project area. The PMO, together with consultants from Hehai University established a social team to investigate, record, evaluate and address social impacts during the project planning and design since November 2009. The Project triggers the Bank policy OP 4.12, and Resettlement Action Plans (RAPs) (with a RPF as an annex) was prepared for the Project with involvement of local government, APPSCIG and APMO. The RAP for Yangqiao ship lock was disclosed locally on August 28, 2014 and the RAP for the second Yingshang ship lock was disclosed locally on December 24, 2014.

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The main resettlement impacts involve 1,658 mu (111 ha) permanent land acquisition, 9,874mu (658 ha) temporary land acquisition, 364 households relocation with 1,489 people. In addition, 34 sites of dredged sediment disposal will have temporary land use which affects 2,891 households with 10,316 persons. There are in total 3,679 households with 13,456 people to be affected to various extent by the resettlement.

Indigenous Peoples (OP/BP4.10). This policy is not triggered based on the social development specialist's screening. The social team has conducted an investigation on IP minority villages along the Project, and identified that there are three Hui minority villages in Saijian Township. Public Disclosure Copy They are part of the mainstream society and are anticipated to benefit as much from the Project as other groups such as the Han communities. In fact, the Hui groups in the project areas do not have their own language but speak Mandarin. They do not have customary economic, social, or political institutions separated from the dominant society while they conduct Islamic religious practice. It is thus concluded that the three Hui villages in the project areas do not fall under the definition of Indigenous Peoples as per OP 4.10, and the policy does not apply to this project.

Linkage issue. The Fuyang ship lock reconstruction project is implemented together with the Project. The ship lock within the river section of the project is a key facility on the inland waterway to be improved by the project. The activity is an upgrading action on the original site without land acquisition or resettlement, and so there is no further resettlement action needed. 2. Describe any potential indirect and/or long term impacts due to anticipated future activities in the project area: Environmental:

The Project will promote waterway transport at regional level, and facilitate the development and utilization of waterway transport infrastructure. Potential cumulative impacts resulting from the development activities were assessed with reasonably defined time and geographical boundaries as part of the project environmental assessment. It is anticipated that potential negative cumulative impacts include loss of habitats, riparian for example; obstruction of fish migration; and waste discharge. These impacts are considered limited and manageable. Overlapping analysis shows that the Project will impact only a small amount of riparian vegetation. Various development plans stipulate that river shore wetlands should be protected to the extent possible. There is no fish spawning area in the Shaying River and Quan River probably due to bad water quality. Local fishery authority confirms that in the watershed spawning areas are found in several tributaries. Public Disclosure Copy Hence development activities on the Shaying River will have no significant impact on fish spawning. There are three ship locks along the Shaying river section, and one ship lock on Quan River, whose impacts associated with expansion and operation on river hydrology and aquatic ecology are very limited. In addition, the Project will support navigation management that includes significant environmental considerations. It is believed that the awareness and environmental management capacity of the Shaying River will be considerably improved through the implementation of the Project.

Social:

The dredging works will cause sludge disposal and involve temporary land acquisition of about 9,831 mu (655 ha) in 34 sites along the River. In addition to identifying and applying existing borrow sites through consulting with local land authorities and villages, the RAP includes a special

Page 7 of 13 land restoration plan and timely and sufficent compensation for land use. This plan will change 1,607 mu (107.1 ha) of wasteland to farmland, and improve 3,080 mu (205.3 ha) of farmland, which will benefit more than 12,500 farmers in 34 villages along the Project. This will increase the land resource and benefit the local inhabitants in the project area. 3. Describe any project alternatives (if relevant) considered to help avoid or minimize adverse impacts. During project preparation, design optimization was conducted and a number of alternatives were analyzed, including the following which are relevant to the mitigation of environmental and social impacts:

Public Disclosure Copy • Service areas. Two services areas will be built under the Project. Locations of the service areas were compared in terms of environmental impacts, resettlement, traffic disturbance, construction convenience, and compatibility with existing development plans.

• Disposal sites for dredged silts. The disposal sites for the dredged sediment from the Shaying River were diligently reviewed with the following considerations: (a) choosing the nearby low-lying land, shoaly land and existing borrow pits for building the dikes to minimize occupation of farmland; (b) filling the ponds and strengthening the foundation of the dikes to benefit the water conservation and flood control; (c) keeping away from built-up areas to avoid pollution by mud disposal; and (d) meeting relevant technical specifications and adding greening and beautification design for the urban sections along the River. During implementation, the principles of selecting disposal sites have been adhered to. Several disposal sites were combined in order to reduce occupation of farmland.

• Dredging methods. Dredging equipment and operational approaches were also compared during project design. It was concluded that cutter-suction dredger is a mature and proven technology for this type of dredging and was therefore adopted.

• Riverbank protection. Extensive design of bank protection works is integrated with the existing infrastructure for water conservation and flood control to optimize the location and scope of the bank protection. Upon ensuring the basic function, priority is given to flexible and/or ecological revetment covered with plants.

• Bridge reconstruction. The issue of bridges impeding navigation due to insufficient clearance is analyzed in detail. The estimation is done on average number of days when navigation Public Disclosure Copy impedance occurs and the ratio of guaranteed navigable days according to the hydrological observation records of the past 22 years. Four bridges will be reconstructed, and anti-collision design is also applied to the exiting bridges.

During project restructuring, alternatives were also considered for the two ship locks. For the second Yingshang ship lock, two locations were considered, i.e. either on the left or on the right of the existing Yingshang ship lock. The selected alternative will take less land and result in less potential impacts on the flood protection function. For the Yangqiao ship lock, expanding the existing ship lock, rather than building a new one, was selected as the final option. 4. Describe measures taken by the borrower to address safeguard policy issues. Provide an assessment of borrower capacity to plan and implement the measures described. Environmental:

Page 8 of 13 The project owner hired an accredited EIA consultant to prepare EAs for the project, EIAs and EMPs for the original designed activities and newly added ship locks were prepared following domestic regulations and Bank safeguards requirements.

The EMPs implementation is managed by the Anhui Provincial Port and Shipping Construction Investment Group (APPSCIG) under the supervision of the Anhui Provincial Transport Department (APTD). Dedicated staff has been appointed to the environmental management office. Qualified environmental staff has been assigned to the Contractors' teams and Supervision Engineers' teams to ensure effective implementation of the EMP. An External Environmental Consultant (EEC) has been hired by APPSCIG to monitor the EMP performance of the Public Disclosure Copy Contractors and Supervision Engineers.

The Bank team has carried out supervision to the project through field visit and review of monitoring reports. The project EMP implementation performance is considered satisfactory. Since the start of the implementation of the project, the project owner has set up proper environmental management institution, carried out environmental supervision and monitoring plans following EMP prepared during project preparation. In particular, the project owner hired external environmental monitoring consultant to strengthen its environmental management capacity. The consultant has carried out field visits, provided training to the project owner, contractor, and supervision engineer, coordinated environmental quality monitoring, and assisted the project owner in preparing semi-annual environmental monitoring reports. The consultant provided valuable support to maintain EMP implementation performance.

The EMPs of the two ship locks detailed the environmental management and supervision organizations and responsibilities, mitigation measures, capacity training plan, monitoring plan, and budget estimates of the EMP implementation. The project owner is committed to ensure that the contractors implement the relevant obligations specified in the EMP that are part of their contracts. The Bank's supervision will continue to monitor environmental activities carried out under the Project in order to ensure compliance.

Social:

House restoration: The 346 urban households in Taihe and Jieshou will be compensated in cash in line with commercial evaluation, with agreement from the affected households who then could purchase their own apartments. 18 rural households in three villages will be compensated at Public Disclosure Copy replacement cost and collectively provided with residential land for restoration based on local residential planning, and public facilities for the new housing by the local government. All the relocated households will also receive transition fee and movement allowance, as well as additional assistance during the house restoration from the local government.

Construction of the Yangqiao ship lock will cause minor land acquisition and resettlement in the Laojie village of Yangqiao. A total of 0.6mu of land originally allocated for house building will be taken. Also, houses of 4 households (10 people) with a total area of 190 square meters will have to be demolished. These households will be compensated according to local standards and their livelihoods will be restored to the original level or better.

Construction of the second Yingshang ship lock will require the permanent acquisition of 136.4mu of national land, with no impact on local communities, and the temporary use of 507.4mu of land as disposal sites, which will affect the Jiangxinzhou, Sanba, and Shabei communities of the

Page 9 of 13 Shencheng Township. Compensation will be provided during project use based on productivity, and the disposal sites will be restored to arable land after use and returned to the local communities. One company will need to be resettled: the Yingshang Ship Lock Management Company, which is a state-owned enterprise with 35 employees and also the executing company for the project activities. The company will fund its own resettlement voluntarily to another site which is owned by the enterprise; therefore, the relocation does not require land acquisition. A RAP has been prepared to guide resettlement at the second Yingshang ship lock, and was disclosed locally on December 24, 2014. The English RAP will be disclosed at InfoShop.

Bridge reconstruction: there are four bridges to be reconstructed under Component 2 of the Public Disclosure Copy Project. The resettlement related to the bridge reconstruction was already included in the RAP. The APMO/APPSCIG and the local governments cooperating closely to ensure that the design of bridges fits into the local transport development plan. Designing and financing of the bridges will take time and need more involvement from the involved parties, so the RP includes detailed recommendations on how to get agreement on bridge reconstruction with the local governments and how to ensure the fund to be available.

Women’s participation: women have participated in resettlement activities such as resettlement impact investigation, village meetings, and focus group discussions. Women will have the same rights as men in receiving compensation, employment and training. In addition, the following measures will be taken to ensure women's rights and interests:

• During project construction, a certain number of women (at least 20% of unskilled labor) will obtain unskilled job opportunities; • Technical training will be firstly provided to affected female laborers to ensure that their economic status will not be lowered; • Affected women will receive relevant information during resettlement and participate in public consultation and resettlement. The compensation agreement with the affected households must be signed by the couples.

Vulnerable people: the RAP identifies some vulnerable people and determines additional financial assistance to these people. In the affected population of the Project, 21 households with 80 people were identified vulnerable (0.6% of the affected population) in 8 villages, in which 16 households with 74 people receive minimum living security; 5 households with 6 people are Wubaohu (Households who are provided with food, clothes, house, health care, burying as died or education Public Disclosure Copy for orphan). Besides the normal measures, the APMO/APPSCIG will grant a subsidy of RMB5,000 to every affected household in order to protect the interests of the affected vulnerable people.

Resettlement budget and financing: the resettlement cost is about RMB169 million and is already integrated into the project budget, which will be fully financed using counterpart fund. Resettlement cost for the four bridges will be jointly financed by the APTD and Fuyang City. 5. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people. Environmental: During project preparation, two rounds of public consultation and information disclosure were conducted in April-May 2008, and December 2009 - April 2010, respectively. Combined opinion surveys and public consultation meetings in the townships, village committee and affected

Page 10 of 13 villagers' home have been implemented during preparation of the EA and RAP. Mitigation measures are determined taking into account the suggestion s from both experts and the public. Most of the concerns have been incorporated either in project design or in the EMP or resettlement plan.

During the first round of public consultation, a brief edition of the EA for the Project was made accessible on the website of Fuyang Maritime Bureau in May 2008 with announcement on Yingzhou Evening Newspaper, to collect opinions, suggestions and concerns from communities and departments affected by the Project. Opinions and suggestions received were documented and incorporated into the EA as appropriate. During the second round of public consultation, a full Public Disclosure Copy version of the EA report was disclosed on April 13, 2010 at local maritime bureaus (hardcopy) and on the websites of APTD, Fuyang Local Maritime Bureau and APPSCIG, with an announcement on Fuyang Daily Newspaper. The EA reports were submitted to the Bank's Inforshop on August 11, 2010. As such, the EA report is easily accessible to the general public.

During the project restructuring, the EAs for newly added activities have undergone public consultation and disclosure following OP4.01 as well. Two rounds of consultation were carried out. Public opinions have been incorporated into the project design and EAs. A revised full EA for 2nd Yinshang Ship Lock was disclosed locally on May 16, 2014 at the website of Fuyang Local Marine Bureau and a revised full EA for Yangqiao Ship Lock was disclosed on September 19, 2014 at Fuyang Port and Navigation Bureau and at the Yangqiao Ship Lock. The final full EAs after incorporating the World Bank comments were re-disclosed locally in potentially affected communities in Yinshang and Linquan on January 12, 2015. They were disclosed at Infoshop on January 8, 2015.

Social: All the key stakeholders such as the losers of land, houses, access roads, and other assets, as well as village committees, local authorities were identified and are fully consulted in the resettlement planning and will be consulted in the RAP implementation.

Information disclosure: The main contents of the RAP were already disclosed in relevant villages and the final RAP was re-disclosed. The feedback of the disclosure has been integrated into the RAP. In addition, a resettlement information booklet was drafted in the RAP and will be distributed among the affected prior to the commencement of the construction.

Public Disclosure Copy Consultation and grievance addressing: The RAP includes a special chapter of participation, consultation and grievance addressing to record the relevant actions already done in the resettlement planning, and further determine new actions, procedures in this regard. The stakeholders were identified at the early stage of the resettlement planning, and were fully consulted on such aspects as project objectives, project locations and impacts, resettlement policies and measures, and so on. Information disclosure was implemented in the RAP preparation and was arranged for the next stage. A detailed procedure on grievance addressing is also developed in the RAP.

As part of the project restructuring, public consultations were conducted to assess impact to local people’s livelihoods caused by construction at Yangqiao ship lock and the second Yingshang ship lock. Based on due diligence review, the construction of the two ship locks will have a negative impact on local communities. Therefore a RAP was prepared to guide resettlement work for the two restructured activities respectively. The RAP for the Yangqiao ship lock was disclosed locally

Page 11 of 13 on August 28, 2014 and at Infoshop on October 31, 2014. The RAP for the second Yingshang ship lock was disclosed locally on December 24, 2014 and at Infoshop on January 6, 2014. B. Disclosure Requirements Environmental Assessment/Audit/Management Plan/Other Was the document disclosed prior to appraisal? Yes Date of receipt by the Bank 26-Nov-2014 Date of submission to InfoShop 08-Jan-2015 For category A projects, date of distributing the Executive // Public Disclosure Copy Summary of the EA to the Executive Directors "In country" Disclosure China 12-Jan-2015 Comments: Resettlement Action Plan/Framework/Policy Process Was the document disclosed prior to appraisal? Yes Date of receipt by the Bank 04-Dec-2014 Date of submission to InfoShop 06-Jan-2015 "In country" Disclosure China 24-Dec-2014 Comments: If the project triggers the Pest Management and/or Physical Cultural Resources policies, the respective issues are to be addressed and disclosed as part of the Environmental Assessment/ Audit/or EMP. If in-country disclosure of any of the above documents is not expected, please explain why:

C. Compliance Monitoring Indicators at the Corporate Level OP/BP/GP 4.01 - Environment Assessment Does the project require a stand-alone EA (including EMP) Yes [ ] No [ ] NA [ ] report? If yes, then did the Regional Environment Unit or Practice Yes [ ] No [ ] NA [ ] Public Disclosure Copy Manager (PM) review and approve the EA report? Are the cost and the accountabilities for the EMP incorporated Yes [ ] No [ ] NA [ ] in the credit/loan? OP/BP 4.04 - Natural Habitats Would the project result in any significant conversion or Yes [ ] No [ ] NA [ ] degradation of critical natural habitats? If the project would result in significant conversion or Yes [ ] No [ ] NA [ ] degradation of other (non-critical) natural habitats, does the project include mitigation measures acceptable to the Bank? OP/BP 4.12 - Involuntary Resettlement Has a resettlement plan/abbreviated plan/policy framework/ Yes [ ] No [ ] NA [ ] process framework (as appropriate) been prepared?

Page 12 of 13 If yes, then did the Regional unit responsible for safeguards or Yes [ ] No [ ] NA [ ] Practice Manager review the plan? The World Bank Policy on Disclosure of Information Have relevant safeguard policies documents been sent to the Yes [ ] No [ ] NA [ ] World Bank's Infoshop? Have relevant documents been disclosed in-country in a public Yes [ ] No [ ] NA [ ] place in a form and language that are understandable and accessible to project-affected groups and local NGOs? All Safeguard Policies Public Disclosure Copy Have satisfactory calendar, budget and clear institutional Yes [ ] No [ ] NA [ ] responsibilities been prepared for the implementation of measures related to safeguard policies? Have costs related to safeguard policy measures been included Yes [ ] No [ ] NA [ ] in the project cost? Does the Monitoring and Evaluation system of the project Yes [ ] No [ ] NA [ ] include the monitoring of safeguard impacts and measures related to safeguard policies? Have satisfactory implementation arrangements been agreed Yes [ ] No [ ] NA [ ] with the borrower and the same been adequately reflected in the project legal documents?

III. APPROVALS Task Team Leader(s): Name: Reda Hamedoun Approved By Regional Safeguards Name: Peter Leonard (RSA) Date: 13-Jan-2015 Advisor: Practice Manager/ Name: Michel Kerf (PMGR) Date: 13-Jan-2015 Manager: Public Disclosure Copy

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