Document of The World Bank
FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No: 44008-AFR
PROJECT APPRAISAL DOCUMENT
ON A PROPOSED GRANT TO THE REPUBLIC OF BENIN
IN THE AMOUNT OF SDR 6.1 MILLION (US$9 MILLION EQUIVALENT)
AND Public Disclosure Authorized ON A PROPOSED CREDIT TO THE REPUBLIC OF SENEGAL
IN THE AMOUNT OF SDR 4.70 MILLION (US$7 MILLION EQUIVALENT)
IN SUPPORT OF SECOND PHASE “B” OF
WEST AND CENTRAL AFRICA AIR TRANSPORT SAFETY & SECURITY ADAPTABLE PROGRAM LENDNG (APL) PROGRAM
Public Disclosure Authorized February 3,2009
Africa Transport Sector Country Department AFRCI Africa Regional Office
This document has a restricted distribution and may be used by Recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Public Disclosure Authorized CURRENCY EQUIVALENTS
(Exchange Rate Effective October 3 1, 2008)
CurrencyUnit = FCFA FCFA 51 1 US$l US$1.49 = SDR 1
FISCAL YEAR January 1 - December31
ABBREVIATIONS AND ACRONYMS
AAANS Administration of Senegal National Air Activities ADB African Development Bank AFTN Aeronautical Fixed Telecommunication Network AMHS Aeronautical Message Handling System ANAC Agence Nationale de 1 'Aviation Civile (National Civil Aviation Agency) APL Adaptable Program Lending ARMP Autorite' de Re'gulation des Marche's Publics (Public Procurement Regulatory Authority) ASECNA Agence pour la Se'curite' de la Navigation Ae'rienne en Afrique et a Madagascar (Agency for Air Navigation Safety in Africa and Madagascar) ATM Air Traffic Management ATN Air Telecommunications Network AVSEC Aviation Security BCEAO Banque Centrale des Etats de 1 'Afrique de 1 'Ouest (Central Bank of West African States) BMPIU Budget Monitoring and Price Intelligence Unit CAA Civil Aviation Authority CAA2 Caisse Autonome d 'Amortissement (Independent Amortization Fund) CAP Cellule d 'Appui aux Projets et Programmes (Projects and Programs Support Unit) CFAA Country Financial Accountability Assessment CEMAC Communaute' Economique et Mone'taire de 1 'Afrique Centrale (Economic and Monetary Community of Central Africa) CEO Chief Executive Officer CMU Country Management Unit COSCAP Cooperative Development of Operational Safety and Continued Airworthiness Program CPMP Cellule des Passations des Marche's Publics (Public Procurement Unit) CPS Country Partnership Strategy DA Designated Account DAC Direction de 1 'Aviation Civile (Civil Aviation Directorate) DAF Director of Administration and Finance
ii FOR OFFICIAL USE ONLY
DDI Direction de la Dette et de I 'Investissement (Directorate for Debt and Investment) DGAC Direction Ge'ne'rale de 1 'Aviation Civile - France (French Civil Aviation Agency) DL Disbursement Letter ECOWAS Economic Community of Western African States EIA Environmental Impact Assessment EMCAP Economic Management Capacity Building Project EO1 Expression of Interests ESIA Environmental and Social Impact Assessment ESMF Environmental and Social Management Framework EU European Union FA Fiduciary Agency FAA Federal Aviation Administration (United States) FM Financial Management FMR Financial Management Report FPM Financial Procedures Manual GDP Gross Domestic Product GPN General Procurement Notice HAALSS High Authority of the Leopold Sedar Senghor Airport HF High Frequency IAS International Accounting Standards IASA International Aviation Safety Assessment (done by the FAA) IATA International Air Transport Association IAU Internal Audit Unit ICAO International Civil Aviation Organization ICB International Competitive Bidding IDA International Development Association IDF International Development Fund IFFAS International Financial Facility for Aviation Safety IFR Interim Financial Report ILS Instrument Landing System IPR Interim Performance Review IPSAS International Public Sector Accounting Standards ISA International standards on Auditing ISR Implementation Status Report IT Information Technology LAN Local Area Network LIB Limited International Bidding LSS Leopold SCdar Senghor (Airport, Dakar Senegal) MDA Ministries, Departments, and Agencies MDTF Multi-Donor Trust Fund MPT Ministry of Public Works and Transportation, Benin MAT Ministry of Infrastructure, Land Transport and Air Transport, Senegal MOF Ministry of Economy and Finance NCB National Competitive Bidding NDT Non Destructive Testing NEPAD New Partnership for Africa's Development
This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not be otherwise disclosed without World Bank authorization. OP/BP Operational Policy/Bank Procedures PCU Program Coordination Unit (within each ANAC) PEFA Public Expenditure and Financial Accountability PEMFAR Public Expenditure Management and Financial Accountability Review PET Project Execution Team PFM Public Financial Management PIE Project Implementing Entity PIM Project Implementation Manual PP Procurement Plan PPR Post Procurement Review PSC Project Steering Committee RAAS Regional Agencies for Aviation Safety REC Regional Economic Community RFP Request for Proposal RIAS Regional Integration Assistance Strategy RSOA Regional Safety Oversight Agencies SAR Search and Rescue SAW ICAO's Standards And Recommended Practices SATCOM Satellite Communication System SBD Standard Bidding Documents sc Steering Committee SDR Special Drawing Rights QCBS Quality-and Cost-Based Selection LCS Least-Cost Selection SOE Statement of Expenditure SPN Specific Procurement Notice SSA Sub Saharan Africa TCB Technical Cooperation Bureau TIA Technical Implementation Agencies TOR Terms of Reference TSA Transportation Security Administration (United States) TT Technical Teams TTL Task Team Leader US$ United States Dollar UEMOA Union Economique et Mone'taire Ouest Afiicaine (West Africa Economic Monetary Union) UHF Ultra High Frequency UNCITRAL United Nations Commission on International Trade Law UNDP United Nations Development Program USFAA United States Federal Aviation Authority VHF Very High Frequency VOR VHF Omni directional Range navigation system WA Withdrawal Application WCA West and Central Africa (Region) WTO World Tourism Organization WTTC World Travel and Tourism Council
iv YD Yamoussoukro Decision
Vice President: Obiageli K. Ezekwesili Regional Integration Director (Acting): Richard Scobey Sector Manager: C. Sanjivi Rajasingham Task Team Leader: Pierre Pozzo di Borgo
V
AFRICA Benin and Senegal Project .Phase 2-B of the West and Central Africa Air Transport Safety & Security APL Program
CONTENTS
A . STRATEGIC CONTEXT AND RATIONALE ...... 1 1. Countries and sector issues ...... 1 2 . Rationale for Bank involvement ...... 2 3 . Higher level objectives to which the program contributes ...... 4
B. PROGRAM DESCRIPTION ...... 5 1. Lending instrument ...... 5 2 . Program objectives and phases ...... 5 3 . Program development objective and key indicators ...... 5 4 . Program components ...... 6 5 . Lessons learned and reflected in the program design ...... 9 6 . Alternatives considered and reasons for rejection ...... 10
C . IMPLEMENTATION...... 10 1. Partnership arrangements ...... 10 2 . Institutional and implementation arrangements ...... 11 3 . Monitoring and evaluation of outcomes/results ...... 12 4 . Sustainability ...... 12 5. Critical risks and possible controversial aspects ...... 13 6 . Credit/Grant conditions and covenants...... 15
D . APPRAISAL SUMMARY ...... 17 1. Economic and financial analyses...... 17 2 . Technical ...... -17 3 . Fiduciary ...... 19 4 . Social ...... 19 5. Environment ...... 19 6 . Safeguard policies...... 20 7 . Policy Exceptions and Readiness ...... -20
Annex 1: Country and Sector Background...... 21
vi Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ...... 28
Annex 3: Results Framework and Monitoring...... 30
Annex 4: Detailed Program Description ...... 34
Annex 5: Program Costs ...... 44
Annex 6: Implementation Arrangements and Monitoring Plan for Good Governance ...... 45
Annex 7: Financial Management and Disbursement Arrangements ...... 59
Annex 8: Procurement Arrangements...... 71
Annex 9: Economic and Financial Analysis ...... 82
Annex 10: Safeguard Policy Issues ...... 89
Annex 11: Program Preparation and Supervision ...... 90
Annex 12: Documents in the Program File ...... 92
Annex 13: Statement of Loans and Credits ...... 93
Annex 13: Statement of Loans and Credits ...... 94
Annex 14: Current Safety Oversight and Accident Situation of Air Transport in WCA ....96
Annex 15: Country Selection Process ...... 97
Annex 16: Country at a Glance ...... 101
Annex 17: Maps - WCAATSSP - Phase 11-B ...... 105
vii AFRICA AFTTR
Date: February 3,2009 Team Leader: Pierre Pozzo di Borgo Acting Regional Integration Director: Richard Sector: Regional integration (P); Scobey Infrastructure services for private sector Sector ManagedDirector: C. Sanjivi Rajasingham development (S) ; Regulation and competition policy (S) ; Trade facilitation and market access (S) Project ID: P108583 Environmental screening category: C Lending Instrument: Adaptable Program Loan Safeguard screening category: S2
APL 2-B - Project Financing Data Estimated Implementation Recipient/ Indicative Financing Plan Period (Bank FY) Borrower
Burkina Faso, APL 1 33.57 96 1SO 35.07 09/30/2006 12/3 1/2009 Cameroon, Guinea, Mali 62.65 92 5.1 1 67.76 46.65 I 94 I 3.11 1 49.76 1 11/21/2007 I 06/30/2011 I Nigeria I Benin and APL 2 -B 16.00 89 2.00 18.00 02/26/09 12/31/2012 Sene al 55.28 100 0.00 55.28 ETOTAL 151.50 96 6.11 158.1 1
Source Local Foreign Total INTERNATIONAL DEVELOPMENT ASSOCIATION I
I Responsible Agency: Civil Aviation Agencies of Senegal and Benin
viii Does the project depart from the CAS in content or other significant respects? [ ]Yes [XI No Ref: PAD A.3 Does the project require any exceptions from Bank policies? [ ]Yes [XI No Ref: PAD D. 7 Have these been approved by Bank management? [ ]Yes [ 1 No Is approval for any policy exception sought from the Board? []Yes [ ] No Does the project include any critical risks rated “substantial” or “high”? [ X]Yes [ ] No Ref: PAD C.5 Does the project meet the Regional criteria for readiness for implementation? [XIYes [ ] No Ref: PAD D. 7 Project development objectives Ref: PAD B.3, Technical Annex 3 The project development objectives are as follows: (i)Improve national Civil Aviation Authorities’ (CAAs’) compliance with International Civil Aviation Organization’s (ICAO’s) safety standards, (ii)Increase national CAAs’ compliance with ICAO’s security standards, and (iii)Enhance main international airports’ compliance with ICAO’s security standards. Project description Ref: PAD B.3, B.4 and Technical Annex 4 The progrim includes the following components:
1. Aviation safety improvements (US7.6 million) For Benin (US$3.9 million): Equipments and trainings for “Search and Rescue” activities; Replacement of basic communications and inspections equipments (e.g., VHF radios, telephone network within the airport area, IT network at headquarters, etc.); 0 Purchase of technical library equipment (e.g., relevant ICAO’s manuals, directives, online library, training materials, etc.); Training of civil aviation staff in the area of civil aviation safety oversight; Dissemination and translation (in English) of updated regulations; and Personnel training based on a prior needs’ assessment study.
For Senegal (US$3.7 million): 0 Medical equipment for ANACS’ medical center; 0 Equipments and trainings for “Search and Rescue” activities; 0 Setting-up of an independent Office for aircraft incidents and accidents investigation; 0 Purchase of technical library equipment (e.g., relevant ICAO’s manuals, directives, online library, training materials, etc.); Training of civil aviation staff in the area of civil aviation safety oversight; Dissemination and translation (in English) of updated regulations; and Personnel training based on a prior needs’ assessment study.
2. Aviation security improvements (US$6.2 million) For Benin (US$3.8 million): Improvement of airport security through the acquisition of passengers and cargo x-ray machines as well as an explosive material tracer; Acquisition of airport personnel identification equipment, security cameras, communications systems, and inspection equipments;
ix Training of civil aviation staff in the area of civil aviation security; and Training of airport security personnel. For Senegal (US$2.4 million): Installation of an access control system at the airport; Training of airport security personnel; Updating of technical regulation; Acquisition of training equipments, communication equipments, and patrol vehicles; and Review of the institutional framework and fees allocation among civil aviation entities.
3. Management and governance oversight of the national component of the program (US$ 4.2 million) For Benin (US$2.3 million) and for Senegal (US$1.9 million):
This activity is meant to encompass the financing of national program component’s operating costs covering CAA’s program dedicated personnel salaries for fiduciary management and technical management; office rentals; and expenses as well as inter alia annual fiduciary audits and day-to-day management. Safeguard policies triggered : None Re$ PAD 0.6, Technical Annex 10 Environmental Assessment (OP/BP/GP 4.0 1) : None Significant, non-standard conditions, if any, for: Re$ PAD C.6 Board presentation: None Credit effectiveness for both countries, unless indicated otherwise: Re$ PAD C.6.3 0 The ANAC/PCU has adopted an Administrative, Financial and Accounting Manual and Project Implementation Manual, both in form and substance, satisfactory to the Association; 0 The PCU has recruited one procurement specialist (Benin and Senegal) and one accountant (Benin) and one administrative and financial director (Senegal), with qualifications, experience and terms of reference acceptable to the Association, in line with the provisions of Section I11 of Schedule 2 to the Financing Agreement; 0 An external auditor to the CAA/ANAC with qualifications, experience and terms of reference satisfactory to the Association has been appointed by the Recipient, in accordance with the provisions of Section I11 of Schedule 2 to the Financing Agreement in order to audit the ANAC’s financial statements and the Project accounts and to audit, in Senegal, the Airport Security Fees collection and management; and The Subsidiary Agreement has been signed between the Recipient and the ANAC. Covenants applicable to program implementation for both countries, unless indicated otherwise: Re$ PAD C.6.4 The Beneficiary will refrain from taking: o any decision and/or measure that affect adversely the ANAC/PCU’s ability to perform any of - its obligations under the Project Agreement; o any decision and/or measure that affect adversely the financial and administrative autonomy of the ANAC; PCU maintains staff satisfactory to the Association during the program duration; The government submits an amended Civil Aviation Code that complies with the ICAO
X Standard and Recommended Practices (SARPs) to its Parliament (Senegal): Cause the ANAC to provide to the Association independently audited financial reports on the activities of the ANAC, no later than six months after the end ofeach fiscal year. To this end, the audit reports shall include statements of revenues collected and the detail of the expenditures incurred, with details of the percentage of expenditures used for safety and security activities; Provide to the Association no later than six months after the end of each fiscal year an annual report of the Airport Security Fees collection and transfer to ANACS carried out by an independent auditor with qualifications, experience and recruited pursuant to terms of reference satisfactory to the Association (Senegal); Provide to the Association for analysis, Mid-term and end of Project security and safety audits carried out by qualified consultants to review the implementation of ICAO’s recommendations and/or action plans; Cause the ANAC to submit to the Association, no later than three months after each airport crisis exercise, a report describing the results of each exercise carried out at Cotonou and Dakar airports, including qualified experts’ comments on the report from qualified consultants who observed the exercises. First crisis exercise is to be carried out by no later than December 3 lSt,2009 at both airports targeted under this phase ofthe program. The crisis exercises will take place either each year (Benin) or every second year (Senegal); Cause the ANAC to submit to the Association throughout Project Implementation, reports, containing information pertaining to rate of illegal objects, as defined by the ICAO, seized from passengers at the targeted airports, by private airline security personnel, by private airport security personnel and/or by the police. This submission to the Bank should be done on a quarterly basis, starting with the quarter ending on March 3 lSt,2009; Cause the ANAC to submit to the Association, no later than 18 months after the Effective Date and six (6) months prior to the Closing Date, ICAO safety and security audit reports ; No later than one month after the project Effective Date, or such later date as may be agreed upon by the Recipient and the Association in writing, the Recipient shall send to the Association the report ofthe Recipient’s public accountant (commissaire aux comptes) on the 2006 and 2007 financial statements ofthe ANAC (Benin) ; and No later than eighteen (18) months after the Effective Date, or such later date as may be agreed upon by the Recipient and the Association in writing, the Recipient shall , in conjunction with the Association and the ANACS, carry out a mid term review ofthe Project, covering the progress achieved in the implementation of the Project. The Recipient shall prepare, or cause the ANACS to prepare, under terms of reference satisfactory to the Association, and furnish to the Association three months prior to the beginning of such mid term review ofthe Project, or on such other date agreed upon with the Association in writing, a report integrating the results ofthe monitoring and evaluation activities performed pursuant to this Agreement, on the progress achieved in the carrying out of the Project during the period preceding the date of such report, and setting out the measures recommended to ensure the efficient carrying out of the Project and the achievement of the objectives of the Project during the period following such date.
xi A. STRATEGIC CONTEXT AND RATIONALE
1. Countries and sector issues
1. Today, air transport accounts for up to 40 percent of world trade by value. It plays a significant role in the economic development of countries. In Africa, where poor road, port and railway infrastructure often constrains the rapid and efficient movements of high value goods earmarked for export, air transport holds both a potential for growth and a role for the economic development of the continent. For now, however, reality has not met expectations and air services in Africa, and especially in West and Central Africa (WCA), continue to be inefficient, expensive and unreliable.
2. In order to address these shortcomings, African Ministers responsible for civil aviation adopted on November 14th, 1999 the Yamoussoukro Decision (YD) on the liberalization of access to air transport markets in Africa. It is enforceable continent-wide since it was endorsed by the African Union Heads of State under the African Union treaty framework in 2000. The Decision’s primary aim is to liberalize intra-African air transport. In order to achieve this goal without compromising safety and security standards, the region Civil Aviations and Airport Authorities (CAAs) must be capable to collectively reach International Civil Aviation Organization’s (ICAO) standards in these areas. ICAO’s
’ Standards and Recommended Practices (SAW) are contained in most of the Annexes of the Chicago Convention on International Civil Aviation in the case of aviation safety, and Annexes 9 and 17 in the case of aviation security and facilitation.
3. The main safety’ issues facing WCA’s air transport sector today include the lack of a compliant and enabling legal framework as well as a critical shortage in qualified inspection manpower. In WCA, fewer than six countries out of 23 are considered to have the required level of Civil Aviation Administration capacities. The current situation results in the presence of “junk companies” whose operations distort the air transport market prevent access to the world market for local African airlines and contribute largely to WCA high accident rates. According to ICAO’s statistics, the WCA region air transport accident rate was thirty times higher than of the United States during the past years (see Annex 14).*
4. In terms of ~ecurity,~currently fewer than five of WCA’s numerous international airports are compliant with world standards. Indeed, most WCA international airports lack basic access control to runways and terminals as well as adequate security procedures. This situation endangers WCA’s air transport network security, resulting in sky-high insurance costs and high internal security costs for airlines. Moreover, in a post September 11, 2001 environment, it risks isolating WCA even further from main air trade flows.
ICAO Definition of Air Transport Safety: A condition in which the risk of harm or damage is limited to an acceptable level. In 2005 alone, out of 35 fatal accidents and the 1,269 related deaths worldwide, Sub-Saharan Africa (SSA) accounted for 13 of these accidents and 374 of these deaths or 37% and 29% of the World’s total, respectively. These figures compare to SSA’s share of the world’s total departure of only 4.5%. 3 ICAO Definition Air Transport Security: A combination of measures and human and material resources intended to safeguard civil aviation against acts of unlawful interference.
1 5. Although the YD is a continent wide initiative, its implementation in WCA has resulted in the signing of an implementation memorandum of understanding as well as, in November 2001, in the creation of two Secretariat Units within the Economic Community of West African States (ECOWAS)4 and the Cornrnunaute‘ Econornique et Mone‘taire de I ’Afrique Centrale (CEMAC).’ Additionally, in 2003, the region’s Ministers of Transport agreed to support the following initiatives: (i)the revision and harmonization of air transport legal and institutional frameworks at each country level, (ii)the development of a new mechanism for effective regional technical and safety regulation, (iii)the creation of a regional economic regulatory framework to address competition, market access, consumer protection, and (iv) the upgrading of security standards for each country as well as WCA’s main airports. In order to fund these initiatives, a scale up in donors and government support is required.
2. Rationale for Bank involvement
6. The Bank was instrumental in the adoption of the YD and later supported through successive regional IDF grants, the adoption of common policies in safety and air transport regulations in WCA. However, the Bank along with regional institutions as well as other international lenders had to acknowledge that most WCA states did not and would not, in the foreseeable future, have the financial and human resources to comply with either United states or ICAO’s safety and security requirements unless external assistance was provided to them. Moreover, even when a state did prove its ability to comply with ICAO’s requirements, its capacity to maintain compliance and retain qualified personnel remained questionable as illustrated, unfortunately, by the Ghanaian CAA’s loss of its US Federal Aviation Administration (FAA) International Aviation Safety Assessment (IASA) category I certification in April of 2005. Accordingly, the Bank in coordination with regional institutions and other international lenders adopted a comprehensive approach to globally address these problems by supporting: (i)the establishment of regional mechanisms to oversee safety and security standards in member countries, and (ii)the financing of national safety and security support programs to enhance local CAA’s ability to comply with ICAO’s standards:
Establishment of regional mechanisms: Three Cooperative Development of Operational Safety and Continued Airworthiness Program (COSCAP) projects were signed in 2003 and 2004 between the ICAO and the West African Economic and Monetary Union (UEMOA6) countries, the ICAO and the Banjul Accord countries (i.e., Non-UEMOA countries within ECOWAS), and the ICAO and the CEMAC countries. The ultimate objective of such program is to establish sub Regional Safety Oversight Agencies (RSOA) by January 1, 2010. The implementation of these COSCAP projects was delayed by one year for the Banjul Accord and the UEMOA countries, and by two years for the CEMAC countries, mainly due to financing and lack of coordination issues, despite the award of
~~ ~ The ECOWAS countries are Senegal, Niger, Nigeria, Togo, Benin, Burkina Faso, Guinea, Guinea-Bissau, Ghana, Mali, Cote d’Ivoire, Liberia, Sierra Leone, The Gambia and Cape Verde 5 The CEMAC countries are Cameroon, Central African Republic, Chad, Gabon, Equatorial Guinea and the Republic of Congo, 6 The UEMOA countries are Benin, Burkina Faso, Cote d’Ivoire, Guinea Bissau, Mali, Niger, Senegal and Togo.
2 grants from the African Development Bank (ADB) and the French government. However, during the last COSCAP follow up meeting held in June, 2008, in Tunis, a detailed action plan was agreed in order to catch up with those delays. Through 2009, ECOWAS and CEMAC member countries will therefore benefit, at no cost to them, from technical assistance in the area of aviation safety. This assistance, however, will be restricted mainly to specific training and technical advisory services as COSCAP projects’ resources are limited (i.e., each project’s budget is less than US$4 million) and their scope excludes aviation and airport security. Nevertheless, the COSCAP projects represent an important first stepping stone towards the creation within UEMOA, ECOWAS and CEMAC of regional aviation safety agencies whose future sector oversight roles will be paramount to ensuring that each country CAAs achieve and maintain minimal compliance with ICAO’s standards.
0 Financing of national safety and security components: In spite of the long term goal of establishing regional aviation safety agencies in WCA, the enforcement of aviation safety and security will remain in the foreseeable future a national endeavor, if only for legal reason^.^ Accordingly, it is critical that known shortcomings affecting national CAAs aviation safety and security oversight capacity as well as airport security personnel and infrastructure be addressed at a national level because regional aviation safety and security reflects each country’s achievements in these areas. This critical linkage between national and regional aviation safety and security is confirmed by a review of passenger traffic flows that shows that in 2006, more than 90 percent of all passengers in Senegal and Benin are regionally’ and internationally bound (see Table 1 below).
Table 1: Estimated passenger traffic distribution in 2007 at selected airports in Benin and Senegal International and Regional Airport Total Passengers Passenger Traffic Cotonou 100% 3 15,000 Dakar 98% 1,727,000
7. This approach is in line with the Regional Integration Assistance Strategy (MAS) for West Africa, adopted in August 2, 2001, and for Central Africa, adopted in February 6, 2003, as well as the Africa Action Plan adopted in September 6, 2005, in as much as it promotes, through regional integration, regional exchanges and economic growth.
8. In order to implement the approach described previously, the Bank has been asked to support the regional project’s national security and safety components as its local presence, ongoing transport projects and flexible lending instruments make it well suited to tackle the project’s financial (i.e., security investment) and institutional issues (ie., safety oversight arrangements, CAA’s reforms, regional pooling of resources) simultaneously in most WCA countries. Meanwhile, support from other donors (e.g., the European Union (EU), ADB) and sector specific organizations (e.g., ICAO, US FAA) as well as from the
7 According to the 1944 Chicago convention, aviation regulation remains a sovereign activity. Until this approach is altered, air safety and security will continue to be managed at national levels. Regional traffic in this case covers all traffic within Africa.
3 member States themselves is directed at ensuring the success of the COSCAP projects as a necessary initial step towards the creation of regional safety agencies.
9. Lastly, the Bank’s involvement in support of the COSCAPs through national aviation component is also warranted by: (i)the aviation sector’s economic impact and, (ii) the support it lends to further regional integration. In the present case, there is a clear linkage between enhancements in air transport security and safety and lower travel costs (see Annex 9). Indeed, air carriers registered in countries with higher safety and security standards benefit from greater market access that stimulates competition. In WCA, where air service frequency is generally poor, such impact could be especially important on tourism trade, a key sector for the region’s economic development. Additionally, improved safety and security will translate into greater acceptance by the WCA countries of each other’s carriers; thus strengthening regional integration. Besides, the countries involved will be adopting and using harmonized aviation codes and regulations, which will enhance the safety and security of the air transportation network. Such a level of harmonization could not be achieved unless there was a complementary effort carried out at national level to that of the COSCAPs at the regional level, at least, regarding air safety oversight.
10. In light of the above, there is ample evidence that the West and Central Africa Air Transport Safety and Security Program (WCAATSSP) meets all the Bank’s regional eligibility criteria as: (i)it involves more than two countries; (ii)its economic and social benefits include enhanced carriers services and lower transport costs that promote national and regional tourism and trade growth; (iii)it supports ongoing regional initiatives to enhance aviation security and safety levels within WCA countries (Le., COSCAP projects) which, in turn, enhance the implementation of the YD (Le., pan African air transport liberalization), and (iv) it funds national activities which have clear externalities as overall WCA countries’ air safety and security depend on each country’s achievement in these areas and most WCA countries’ air traffic is international, with a significant intra regional market share.
3. Higher level objectives to which the program contributes
1 1. In addition to allowing the identified countries in the region to significantly improve the results of their ICAO Safety and Security Audits, the program higher objective is to create a safe and secure environment for air transport in WCA that will allow African airlines to competitively access regional and worldwide market with the expected result to support sustainable economic growth region-wide. This higher objective is consistent with the New Partnership for Africa’s Development (NEPAD) Infrastructure Short Term Action Plan, the YD as well as the Bank’s Africa Action Plan.
4 B. PROGRAM DESCRIPTION
1. Lending instrument
12. Since the readiness and needs of the 23 WCA countries to receive support from the program vary significantly (see Annex 15), it was decided to select a horizontal Adaptable Program Loan (APL) instrument to allow for a phased long-term development program. Countries will join the program under three successive phases using similar eligibility criteria. These criteria are: (i)the creation of an administratively and financially autonomous national civil aviation agency, (ii)the use of aviation security and/or safety taxes for the purpose of financing its civil aviation agency and, (iii)the attainment of definite percentage of compliance level with ICAO’s standards in the areas of aviation security and safety, as well as improved airport security.
13. The program will be financed through the IDA program for regional projects under the IDA’S 15th replenishment (IDA 15), with country IDA allocations funding one third of its cost and regional IDA funding financing two thirds of its costs in recognition of the positive externalities of the program.
2. Program objectives and phases
14. Under Phase Iof the program, approved by the Board in April 2006, four countries; namely Burkina Faso, Cameroon, Guinea and Mali, received a total of US$33.57 million in grant and credit financing. Phase II-A of the program was initiated with Nigeria following Board’s approval in October 2007, with a Credit amounting US$46.65 million. Subsequently, Phase II-B of the program which includes Benin and Senegal for an estimated total investment cost of US$16.00 million was developed. Phase I11 may encompass Mauritania, the Republic of Congo, Equatorial Guinea, C6te d’ Ivoire, Ghana, Niger, Guinea Bissau, Liberia, Sierra Leone, Chad, Central African Republic, Sao Tom6 & Principe, and Togo for an estimated investment cost of US$55.28 million.
15. As indicated in the program document submitted to the Board for Phase I, any country’s program component will be based on a set of standardized project activities in aviation security and safety and airport security, to allow them to significantly improve their performances based on ICAO’s Safety and Security Audits. Benin and Senegal proposed program’s components do not depart from this requirement.
3. Program development objective and key indicators
16. The Program Development Objectives (PDOs) which apply to all program’s phases, and therefore to Benin and Senegal, are to: (i)Improve national Civil Aviation Authorities’ (CAAs) compliance with International Civil Aviation Organization’s (ICAO) safety standards, (ii)Increase CAA’s compliance with ICAO’s security standards, in both cases, to achieve international average with all actions in their Corrective Action Plan contained in the respective audits completed, and (iii)Enhance main international airports’ compliance with ICAO’s security standards. In order to measure attainment of these PDOs, the following key outcome indicators and target values are used for all participating countries:
5 PDO 1 - Improve CAA’s compliance with ICAO’s safety standards: 9 Compliance rate with ICAO aggregate safety standards based on ICAO’s audits, with all actions in their Corrective Action Plan completed; 9 Percentage of technical personnel in compliance with ICAO’s safety standards; and 9 Total CAA’s budget amount. PDO 2 - Improve CAA’s compliance with ICAO’s security standards: > Compliance rate with ICAO’s aggregate security standards based on ICAO’s audit, with all recommendations addressed; 9 Percentage of CAA’s ICAO’s certified security inspectors trained during the last three years; 9 Level of CAA’s budget dedicated to security; and 9 National Security Plan compliance with ICAO’s standards. PDO 3 - Enhance main international airports’ compliance with ICAO’s security standards: > Percentage of airport security personnel with three or more years of experience; > Number of serious problems recorded during annual airport crisis exercises; and > Percentage of embarking passengers stopped in possession of illegal objects, as defined by the ICAO, by airlines security personnel or the police.
17. Additionally, when applicable, the following longer term key outcome indicators are to be used to evaluate the program’s impact: e The country is certified FAA IASA’ Category 1, in the case it anticipates to have direct flights to the United States of America; e Main international airports are certified for direct flights to the United States by the US Transport Security Administration (TSA); e No airlines registered in participating countries are listed on the European Union’s airline black list; and 0 Overall WCA airline accident rate has decreased.
4. Program components
18. The program supports the ongoing development of a regional Air Transport Program within the context of the YD implementation. As such, it complements the work that is currently undertaken by regional institutions (with donors’ support) in the area of Air Transport Economic Regulation harmonization, while primarily focusing on airport and aviation safety and security. Secretariats are now officially established within the UEMOA, ECOWAS and CEMAC levels, in order to manage COSCAP programs: they have regional and national program management responsibilities in order to promote effective coordination and harmonization at the regional level. However, national program component continue to be effectively implemented independently by designated entities within each country.
9 International Aviation Safety Assessment.
6 19. Benin and Senegal program costs are estimated at US$18.00 million. Detailed national program component activities costs are presented in Table 2 below, for the two aviation agencies (CAAs) that will benefit from the project.
Table 2: Financing breakdown for the Benin and Senegal program components of the WCAATSSP (in US$ million) I Sector of activity I Financing sources I Aviation Project Aviation Safety World
Security ~ Improvements Management 1 Bank 1 1 Imwovements and Oversight- Benin 3.9 3.8 2.3 10.0 9.0 1.o Senegal 3.7 2.4 1.9 8.0 7.0 1.o Total 7.6 6.2 4.2 18.0 16.0 2.0
20. National program component activities were elaborated with Benin and Senegal CAA.s in order to address globally safety and security issues affecting the aviation sector in each country. National CAA will contribute through the provision of office space and manpower for duration of the project.
4.1. Aviation safety improvements (US$7.6 million)
For Benin (US$3.9 million): 0 Equipment and training for “Search and Rescue” activities; 0 Replacement of basic communication and inspections equipment (e.g., very high frequency (VHF) radios, telephone network within the airport area, IT network at headquarters, etc.); 0 Purchase of technical library equipment (e.g., relevant ICAO’s manuals, directives, online library, training materials, etc.); 0 Training of civil aviation staff in the area of civil aviation safety oversight; 0 Dissemination and translation (in English) of updated regulations; and Personnel training based on a prior needs assessment study.
For Senegal (US$3.7 million): Medical equipment for ANACS’ medical center; 0 Equipment and training for “Search and Rescue” activities; 0 Setting-up of an independent office for aircraft incidents and accidents investigation; Purchase of technical library equipment (e.g., relevant ICAO’s manuals, directives, online library, training materials, etc.); 0 Training of civil aviation staff in the area of civil aviation safety oversight; 0 Dissemination and translation (in English) of updated regulations; and Personnel training based on a prior needs assessment study.
7 4.2. Aviation security improvements (USS6.2 million)
For Benin (US$3.8 million): Improvement of airport security through the acquisition of passengers and cargo x-ray machines as well as an explosive material tracer; 0 Acquisition of airport personnel identification equipment, security cameras, communications systems, and inspection equipments; Training of civil aviation staff in the area of civil aviation security; Training of airport security personnel.
For Senegal (US$2.4 million): Installation of an access control system at the airport; Training of airport security personnel; Updating of technical regulation; Acquisition of training equipments, communication equipments, and patrol vehicles; and Review of the institutional framework and fees allocation among civil aviation entities.
4.3 Management and governance oversight of the national component of the program (US$4.2 million)
For Benin (US$2.3 million) and for Senegal (US$1.9 million):
21. This activity is meant to encompass the financing of national program component operating costs covering CAA program dedicated personnel salaries for fiduciary management and technical management, office rentals and expenses as well as inter alia annual fiduciary audits and day-to-day management.
4.4 Relationship between activities description in the Project Appraisal Document and the Financing Agreements
22. The negotiated Financing Agreements for both countries present the project’s components along the following lines: a) Strengthening of Recipient’s sectoral policy and of ANAC’s safety and security oversight capacity, b) Strenghtening of airport security standards, and c) Project coordination, management and oversight. The content of these components is similar to those described above in sections 4.1 through 4.3. They are, however, just organized differently (i.e., aligned with beneficiaries versus functionalities). Table 3 shows the relationship in terms of activities description between the PAD and the FAs.
8 Table 3: Project components relationship between the Finaning Agreements and the Project Appraisal Document
Financing Agreements Strengthening of Recipient’s sectoral Strenghtening of airport security and safety Project policy and of ANAC’s safety and standards, coordination, security oversight capacity management and oversight
0 Purchase of technical library Equipment and training for “Search and equipment (e.g., relevant ICAO’s Rescue” activities
manuals, directives, online library, 0 Replacement of basic communication and training materials, etc.) inspections equipment (e.g., very high
0 Training of civil aviation staff in the frequency (VHF) radios, telephone network area of civil aviation safety oversight within the airport area, IT network at Dissemination and translation (in headquarters, etc.);
English) of updated regulations 0 Improvement of airport security through the Personnel training based on a prior acquisition of passengers and cargo x-ray needs assessment study machines as well as an explosive material Training of civil aviation staff in the tracer; area of civil aviation security Acquisition of airport personnel identification equipment, security cameras, communications systems, and inspection equipments; Training of airport security personnel. Same as PAD
0 Medical equipment for ANACS’ center Equipment and training for “Search and Setting-up of an independent office for Rescue” activities
aircraft incidents and accidents 0 Installation of an access control system at the investigation airport
Purchase of technical library 0 Training of airport security personnel
equipment (e.g., relevant ICAO’s 0 Updating of technical regulation;
manuals, directives, online library, 0 Acquisition of training equipments, training materials, etc.) communication equipments, and patrol 0 Training of civil aviation staff in the vehicles
area of civil aviation safety oversight 0 Review of the institutional framework and 0 Dissemination and translation (in fees allocation among civil aviation entities English) of updated regulations
0 Personnel training based on a prior needs assessment studv
5. Lessons learned and reflected in the program design
23. Since this program was the first regional aviation security and safety program in the Africa region, there were limited precedents that could be used during the project design phase. However, the following findings from the implementation of the first Phase and Phase 11-A ofthe program have been used to better design the current program’s Phase 11-B:
Program design must reflect the intent, interest, and priorities of its beneficiaries and stakeholders so as to ensure their ownership and particularly their support to the accompanying reform processes. The implementation of new audit standards by ICAO in the area of security and safety as well as the agreement by all ICAO members’ states in 2007 to publish the results of their safety audit has effectively ended an era of lack of accountability within developing countries’ CAAs. Accordingly, national program components are now specifically designed around the results of recently published ICAO
9 security and safety audits using new audit standards and do focus both in terms of money and timeline more on manpower training and regulatory regime improvements over equipment acquisition when compared to the previous phase program activities. This change of priority within each national program component has been demanded by beneficiary CAAs as it will help them improve their now public ICAO compliance ratings in safety. Program design must be coordinated with other donors in order to ensure consistency in the goals and expected outcomes of all planned and undergoing programs within the same sector. The program was developed in close cooperation with all the donors agencies involved in the aviation sector in WCA, especially USFAA, European Union (EU), ADB, DGAC, and ICAO. The Bank’s team has widely shared the initial results of Phase Iof the program with all local and international partners in order to foster an Africa-wide initiative on aviation security and safety matters. This effort culminated in September 2007 with the announcement at the ICAO 2007 annual meetings of an Africa wide initiative under the auspices of the ICAO and the African Union (AU) to combat poor ICAO safety and security standards compliance by African’s CAAs. Program design must emphasize capacity building for the targeted agencies. Experience in WCA countries confirms that sustained program impact depends on well- managed, well-financed executing agencies. Accordingly, during the preparation of Phase 11-B of the program, the Bank’s team has paid special attention to policy issues surrounding CAA’s financial and administrative autonomy with a view of ensuring that sought after results in terms of security and safety oversight capacity will be sustainable.
6. Alternatives considered and reasons for rejection
24. The only alternative to the regional approach recommended to develop adequate air transport safety and security would have been an individual country by country approach. Similar examples of the former type of approach (e.g., in Central America) have shown that a regional approach is indeed the preferred option as small countries are unable to gather on their own the necessary resources to meet ICAO’s security and safety standards. Furthermore, by linking national activities to regional ones, more incentives are given to governments to carry out necessary sector reforms.
C. IMPLEMENTATION
1. Partnership arrangements
25. The program regional component (i.e., COSCAP projects) is financed through grants obtained from other bi or multilateral donors, as well as from contributions to the member States. As shown in Table 4, the grant financing is already secured and Benin and Senegal CAAs are eligible to benefit from the assistance of the UEMOA’s COSCAPs. National program components also benefit from support of bilateral technical assistance or aid, especially that of the US in the countries which are members of the Safe Skies Initiative (Le., Senegal) and of France when there is an existing cooperation in the area of security and/or safety (Le., Benin).
10 26. The Bank continues to work closely with others donors to finance at the national level complementary activities to that of the COSCAPs as it will not be able to answer requests for financing from all WCA countries at once. During a COSCAP follow-up meeting held in June 2008, in Tunis, it was reiterated that all the donors should coordinate their actions in order to avoid unnecessary duplications regarding capacity strengthening in air safety oversight, and to promote the concept and the creation of Regional Safety Oversight Agencies.
European Commission Agreement Signed I Signed I Signed European Commission Grant US$SOO,OOO I US$500,000 I US$500,000 Others ADB studv on regional air safetv agencies (US$400.000) World Bank, 2008
2. Institutional and implementation arrangements
27. The implementation of the program’s regional component (Le., COSCAP) is overseen by the technical bureaus of the two regional organizations: ECOWAS and CEMAC (see Figure 1) while the fiduciary implementation (financial management and procurement responsibilities) of the national components will be managed by the local CAAs in Benin and Senegal, through their Program Coordination Units (PCU). Technical management of the program will also be handled by local CAAs as they possess unique technical knowledge in the field of aviation. The CAAs will also draft initial technical documentation in support of the project’s procurement activities, and oversee the implementation on the ground of the project’s activities. As in other countries, financial and procurement assessments of the PCU and CAAs have resulted in recommendations designed to address the shortcomings identified in terms of financial and procurement capacities.
28: Disbursements for all activities benefiting the agencies will be centralized in a designated account managed by the respective CAAs in order to increase project’s fiduciary compliance. Furthermore, the PCU personnel who is made of CAA staff will be strengthened by externally recruited specialists in the area of procurement and financial management whose initial appointment will be for at least a year with terms of reference explicitly geared towards building capacity of the units and agencies’ staff. These recruitments will be financed initially by the respective CAAs and reimbursed by IDA upon
11 effectiveness, subject to compliance with IDA’S procurement guidelines. The Financing Agreements will include a retroactive financing clause to this effect.
3. Monitoring and evaluation of outcomeshesults
29. The evaluation of outcomes will be done primarily based on ICAO’s safety and security audits, using follow-up audits undertaken by qualified consultants to measure progress made against baseline values. In some cases such as airport security, program impact will be measured using data collected by individual CAA (see Annex 3 for details), although the source of the data will be either provided by independent operators such as airlines or qualified independent consultants. In order to preserve the confidentiality of the data presented in ICAO’s audits, program indicators will only assess globally each country’s compliance with ICAO’s safety and security standards rather than identify individually the standards that have not been complied with. Nevertheless, discussions held with governments during project monitoring will cover specifically standards that have not been complied with, so as to secure the projected improvements in overall compliance rates. Every participating country will have their safety and security compliance with ICAO standards audited during the course of the program (Le., at mid-term and at program closing).
World Bank, 2008 4. Sustainability
30. The key sustainability factors are: (i)institutional reforms have been implemented to ensure CAAs administrative and financial autonomy; (ii)necessary safety and security infrastructure and oversight capabilities have been established in the form ofpotent national and regional safety and security agencies; (iii)appropriate financing mechanisms (e.g., user
12 fees) have been developed and adopted to sustain local and regional institutional oversight and security/safety infrastructure capacities. These factors are translated into project outcome indicators and legal covenants in order to secure project long term sustainability (see Annex 3 and section C.6.4).
5. Critical risks and possible controversial aspects
3 1. The primary risk concerns the implementation capacity of the program’s activities by CAAs (see Table 5 below). This risk is rated as moderate.” Since neither of the two CAAs has ever managed a Bank’s project, the following arrangements have been made: e The CAAs will have fiduciary management responsibility of the program. Accordingly, their procurement and financial management capacity will be strengthened through the transparent recruitment of expert consultants paid by the program. e The CAAs will draft initial technical documentation in support of the program’s procurement activities, and oversee the implementation on the ground of the program’s activities.
32. Another program risk is the limited ability of CAAs to rigorously enforce security and safety standards on national operators such as airlines and airports operators. Fortunately, CAAs’ leverage in these areas will be strengthened by the creation of regional aviation safety agencies. Indeed, the African Development Bank (ADB) grant provided to ECOWAS, UEMOA and CEMAC to finance the three COSCAP projects in WCA requires the creation, before the end of 2008, of three regional safety agencies. A subsequent grant to finance COSCAP activities centered on aviation safety is also programmed with a similar PDO (Le., creation of regional security agencies). Finally, the current crackdown by European nations on unsafe airlines (e.g., suspension in September 2005 of Cameroon Airlines’ access to the French airspace) is forcing African governments to take aviation security and safety seriously as is the public disclosure, starting in 2008, by the ICAO of each member’s country CAA safety audit compliance rate results. Nevertheless, this risk is rated as substantial in the case of Senegal. In the case of Benin the risk is rated as moderate.
33. An additional risk concerns the ability of CAAs to secure and maintain a technically proficient workforce so as to ensure the program’s sustainability. Although the autonomy of the CAAs has been enshrined into law by decree No. 2004-598 of October 29, 2004 for Benin and decree No. 2003-384 of May 21, 2003 for Senegal, the number and share of unqualified personnel in those CAAs remains high. Indeed, the recent ICAO safety audits carried out in Senegal and Benin show that the technical personnel of each CAA is only 39 percent compliant with ICAO technical standards in the case of Senegal and 1 percent in the case of Benin. Accordingly, unless CAAs’ workforce skills and numbers are radically readjusted in the coming years, serious concerns will remain about their ability to achieve world class aviation safety and security standards. The governments’ commitment to the Bank to improve each CAA’s budget and management autonomy during the project implementation through specific budgetary and training target represents a potent insurance
10 Risk for World Bank’s projects is rated, from the highest to the lowest, as follows: High (H), Substantial (S), Moderate (M), and low (L).
13 against this risk. Nevertheless, experience from Phase I of the project and the lack of qualified aviation personnel within WCA suggests that this risk will continue to be substantial.
34. Apart from the implementation arrangements, and in order to address governance risks, the program design incorporates a variety of mitigation measures to ensure efficient and transparent decision making and use of resources. Among them are: (i)the use from the program’s Phase Iof a technical database providing cost benchmarks for the standardized activities that will be implemented in Benin and Senegal so as to ensure bids’ cost fairness; (ii)the designation of the CAAs as the sole responsible entities for fiduciary and procurement matters so as to hold a single entity accountable for any project governance issues as part of the procurement and execution of contracts; (iii)the strengthening of the PCUs procurement and financial capacity through the transparent recruiting of expert consultants in these matters, as needed; (iv) the implementation of yearly independent financial audits of the CAAs’ and the Program’s accounts; and (v) the elaboration of a governance plan in each country, based on the previously quoted measures, complemented by a strengthening of the internal control, the utilization of the existing national measures against corruption, and the large diffusion of the project’s objectives and results to all the stakeholders. Accordingly, the program’s governance risk was rated as moderate.
Risk rating with Mitigation measures Risks mitigation Benin Senegal Benin Senegal Recruitment of Financial Recruitment of Financial Limited project Management and Management and implementation capacity of Procurement Specialists Procurement Specialists M M CAA (Consultants) to reinforce (Consultants) to reinforce the CAA personnel. the CAA personnel. Limited ability of CAA to aggressively enforce Creation of regional aviation security and safety agencies, security and safety public disclosure of ICAO’s safety audit results standards on national operators Of CAA to Secure Strengthening the CAA’s capacity through large training and maintain a technically programs and budgetary targets S S proficient workforce Recruitment of external Recruitment of external fiduciary consultants within fiduciary consultants within Governance the CAA. the CAA. M M Adoption of a governance Adoption of a governance plan for the component. plan for the component.
35. Based on the ratings given to the four above listed risks, overall risk for the program is rated as substantial. However, a more in depth analysis of the project’s risks with mitigation measures is presented in Annex 6.
14 6. Credit/Grant conditions and covenants
6.1. The conditions for negotiations of the IDA Credit and Grant
36. None.
6.2. The conditions for Board approval
37. None.
6.3. The conditions for effectiveness of the IDA credit and Grant (above standard effectiveness conditions as specified in the General Conditions)
38. There are for both countries, unless indicated otherwise:
0 The ANAC/PCU has adopted an Administrative, Financial and Accounting Manual and Project Implementation Manual, both in form and substance, satisfactory to the Association; 0 The PCU has recruited one procurement specialist (Benin and Senegal) and one accountant (Benin) and one administrative and financial director (Senegal), with qualifications, experience and terms of reference acceptable to the Association, in line with the provisions of Section I11 of Schedule 2 to the Financing Agreement; 0 An external auditor to the CAA/ANAC with qualifications, experience and terms of reference satisfactory to the Association has been appointed by the Recipient, in accordance with the provisions of Section I11 of Schedule 2 to the Financing Agreement in order to audit the ANAC’s financial statements and the Project accounts and to audit, in Senegal, the Airport Security Fees collection and management; and The Subsidiary Agreement has been signed between the Recipient and the ANAC.
6.4. Legal covenants
39. There are for both countries, unless indicated otherwise:
0 The Beneficiary will refrain from taking:
0 any decision and/or measure that affect adversely the ANAC/PCU’s ability to perform any ofits obligations under the Project Agreement;
0 any decision and/or measure that affect adversely the financial and administrative autonomy ofthe Agence Nationale de 1 ’Aviation Civile; PCU maintains staff satisfactory to the Association during the program duration; The government submits an amended Civil Aviation Code that complies with the SARP, to its Parliament (Senegal); Cause the ANAC to provide to the Association independently audited financial reports on the activities of the ANAC, no later than six months after the end of each fiscal year. To this end, the audit reports shall include statements of revenues collected and the detail of the expenditures incurred, with details of the percentage of expenditures used for safety and security activities;
15 Provide to the Association no later than six months after the end of each fiscal year an annual report of the Airport Security Fees collection and transfer to ANACS carried out by an independent auditor with qualifications, experience and recruited pursuant to terms of reference satisfactory to the Association (Senegal); Provide to the Association for analysis, Mid-term and end of Project security and safety audits carried out by qualified consultants to review the implementation of ICAO's recommendations and/or action plans ; Cause the ANAC to submit to the Association, no later than three months after each airport crisis exercise, a report describing the results of each exercise carried out at Cotonou and Dakar airports, including qualified experts' comments on the report from qualified consultants who observed the exercises. First crisis exercise is to be carried out by no later than December 3 lS',2009 at both airports targeted under this phase of the program. The crisis exercises will take place either each year (Benin) or every second year (Senegal). Cause the ANAC to submit to the Association throughout Project Implementation, reports, containing information pertaining to rate of illegal objects, as defined by the ICAO, seized from passengers at the targeted airports, by private airline security personnel, by private airport security personnel and/or by the police. This submission to the Bank should be done on a quarterly basis, starting with the quarter ending on March 3 Is',2009; Cause the ANAC to submit to the Association, no later than 18 months after the Effective Date and six (6) months prior to the Closing Date, ICAO safety and security audit reports ; No later than one month after the project Effective Date, or such later date as may be agreed upon by the Recipient and the Association in writing, the Recipient shall send to the Association the report of the Recipient's public accountant (commissaire aux comptes) on the 2006 and 2007 financial statements of the ANAC (Benin) ; and No later than eighteen (1 8) months after the Effective Date, or such later date as may be agreed upon by the Recipient and the Association in writing, the Recipient shall , in . conjunction with the Association and the ANACS, carry out a mid term review of the Project, covering the progress achieved in the implementation of the Project. The Recipient shall prepare, or cause the ANACS to prepare, under terms of reference satisfactory to the Association, and furnish to the Association three months prior to the beginning of such mid term review of the Project, or on such other date agreed upon with the Association in writing, a report integrating the results of the monitoring and evaluation activities performed pursuant to this Agreement, on the progress achieved in the carrying out of the Project during the period preceding the date of such report, and setting out the measures recommended to ensure the efficient carrying out ofthe Project and the achievement of the objectives of the Project during the period following such date.
16 D. APPRAISAL SUMMARY
1. Economic and financial analyses
40. The need for expanding and improving air services and markets in Africa, to which this program contributes, has been acknowledged by the NEPAD. It is recognized that improvements and expansion of aviation infrastructure can make a significant contribution to facilitating inward investment in tourism and developing non-traditional exports with relatively high value added content in Africa. These cannot take place, however, without adequate security and safety of aviation operations. Accordingly, this program has the potential to indirectly impact the long term macro-economic growth prospects of African economies by: (i)ensuring the sustainability of other investments in the sector (e.g. airport facilities expansion, airlines services deregulation), (ii)promoting tourism activities, (iii) enhancing overall investment climate (i.e. inward investment levels), and (iv) expanding exports trade.
41. While Annex 9 details these potential impacts, it is necessary to underscore that among all of the world’s regions; Africa is the most dependent on aviation services when it comes to tourism activities with, according to the World Travel Tourism Council (WTTC), almost three million direct and indirect tourism jobs supported by air services in 2004. Likewise inward investment levels as well as international market access for WCA countries’ high value perishable agricultural goods such as cherry tomatoes and flowers are highly affected by the level of security and safety of airlines operations to/from and within WCA. As such, the program can be viewed as an important building stone in the overall economic development strategy of the WCA countries.
2. Technical
42. In order to provide a comprehensive view of the allocation of funds, the abtivities to be financed under the program have been detailed and divided in eight categories (see Table 6). Each of the category’s technical difficulty was assessed. While none of them is difficult to implement technically, this phase of the program will benefit experience gleaned in Phases I and I1 regarding: (i)the supply of goods, some of which require careful procurement, such as x-rays, and (ii)training, where ease of implementation of on site and off-site training has already been tested in several countries.
17 Table 6: Program costs by activity category and by aviation agency (in US$ millions)
World Bank, 2008
a) Personnel training: The aim is to provide knowledge, experience and build capacity within the CAAs in the field of air transport safety and security. Special attention will be also directed towards ensuring that airport and agency personnel are adequately trained to benefit fully from the equipment procured by the program.
b) CAA’s equipment: This category includes the procurement of IT systems, security systems and the development of training facilities in order to facilitate inner agency communications, and increase the agency security with a view to improve overall productivity.
c) Aviation equipment: This equipment aims at improving communication capacity of each agency’s personnel as well as airport communication.
d) Airport security equipment: Screening and other security equipments are procured to strengthen the security of Benin and Senegal International airports.
e) Crisis center equipment: Crisis management centers will be installed or upgraded in Cotonou and Dakar international airports in accordance with ICAO’ s requirements.
f) Airport infrastructure equipment: Airport infrastructure investments are essential for Benin and Senegal international airports to meet the most stringent international security and safety standards. This category includes closed circuit television monitoring systems.
g) Consultina services: These are studies, technical assistance, audits aimed at strengthening the CAAs capacities in their main mission of supervising civil aviation safety and security and in the fiduciary field,
18 in order,to optimize a good management of the project’s funds as well as the overall funds collected for the civil aviation industry.
h) Program management and miscellaneous: Program management costs include the costs incurred for the salaries of pertinent staff in charge of the fiduciary and technical management of each program national component, the provision of office spaces and/or rental costs, and similar obligations. Miscellaneous covers the cost ofvarious consulting services and audits.
3. Fiduciary
43. The overall assessment of risks in terms of financial management for this program has been rated as moderate. This rating has been assigned in spite ofthe fact that both Benin and Senegal’s CAAs will have adequate financial management capacity as part of the credits effectiveness conditions. The Benin and Senegal CAAs will be responsible for reporting financial data (including the preparation of Interim Financial Reports - IFRs) to both the government and the Bank.
44. The assessment revealed that there is inadequate procurement capacity at the Benin and Senegal CAAs which have never managed a Bank financed project in the past. A Procurement Specialist will be hired to assist the regular staff at the Benin and Senegal CAAs in handling the programs’ fiduciary responsibilities. The latter will also be assisted in its tasks by personnel of the respective CAAs as described in Annex 6 of this document. Part of the PCUs’ Procurement Specialists (Consultants) terms of reference will include training and development of the PCUs designated Procurement Officer’s skills in Bank procurement procedures. Identified weaknesses and risks resulting from the assessment will be addressed with the list of corrective measures that will be put in place prior and during program implementation as detailed in Annex 8 ofthis document.
4. Social
45. N/A.
5. Environment
46. No sensitive environmental issues should be raised by the program’s implementation as there will be no construction activities or land acquisition: The proposed investments are essentially for the acquisition of basic communication and inspection equipments and the development of safety and security programs. These investments do not have environmental or social safeguard implications; hence, there will be no negative impact from the program. The regulatory framework governing the environmental management of operations in Senegal is well known since the Bank has multiple transport projects currently underway in this country. In the case ofoperations at Cotonou airport, existing regulations are not known and will need to be investigated further in order to know if there is an impact during the program implementation. However, due to the nature of the work to be carried out at the airport, no environmental or social issues are anticipated as neither airport is experiencing issues related to illegal settlement on its premises (during the first phase of the program,
19 mitigating measures were implemented for two countries). No environmental or safeguard policies are triggered by investments under the current proposed operation.
6. Safeguard policies
47. The program is categorized C for Benin and Senegal. No safeguards policies apply.
7. Policy Exceptions and Readiness
48. The program does not require any exceptions from Bank’s policies.
20 Annex 1: Country and Sector Background
West and Central Africa Air Transport Safety & Security Program Phase 2-B
1. The 23 countries of Western and Central Africa represent a total land area of over 9 million square kilometers, i.e. about the size of Canada, with a combined population of 28 1 million, i.e. about 4.5 percent of world population. Most countries belong to the low income group, with per capita national incomes ranging from US$130 (Sierra Leone) to US$600 (CBte d'Ivoire). Only two countries, Cape Verde and Gabon, have a per capita income in excess of US$l,OOO.
I. The Air Transport Market
2. As the air transport market is linked to the volume of the economy, traffic generation is rather low in the region; the countries with the highest per capita and global income (or GDP) are also those where the higher air traffic figures are recorded.
Domestic air transport markets
3. The domestic air transport market is non existent or marginal in some of the smallest countries of the sub-region, with the exception of the island states such as Cape Verde. Other countries have a limited domestic air transport market; only one country, Nigeria, has a really important domestic air transport industry.
4. Due to the lack of comprehensive statistics about regional air traffic," some estimates have been provided. The highest volume of regional traffic for the year 2004 is recorded in Senegal, with more than one million regional passengers, followed by Mali. Nigeria generates less regional traffic than Mali, Ghana or Cameroon, probably because the size of its economy makes it more self-sufficient than its neighbors'; other factors may be security and facilitation problems, as well as the weakness of Nigerian flag carriers on the regional market. Among individual routes, Lagos-Accra comes first with about 150,000 passengers (see Table 1 below). Other routes with sizeable traffic volumes are Dakar- Bamako, Dakar-Abidjan, Bamako-Abidjan; and Douala-Libreville. Actually, three high traffic density areas emerge: the Lagos-Accra-Freetown-Banjul corridor; the Dakar- Bamako-Abidjan corridor and the Douala-Libreville-Pointe Noire corridor. By contrast with these high traffic density areas, traffics in the Sahel area and in Central Africa's landlocked countries are minimal. Economic links are the main driving force behind the inter-state market. Non-business or government related air traffic is restricted to individuals in the higher income bracket.
5. The collapse of Air Afrique, subsequent abolition of barriers to market entry set by the YaoundC Treaty, and the entry into force of the Yamoussoukro Decision affected the economic context of inter-state air transport but did not substantially alter these traffic patterns.
~~~ " In the statistics used by WCA countries, regional air transport traffic often refers to air transport within Sub- Saharan Africa countries.
21 Ta
Source: Air Transport in West and Central Africa, Fact and Issues, Michel Iches, 2008
Continental markets
6. Traffic with North Africa has developed steadily, capitalizing on traditional trade links (especially between Morocco and Senegal) and common culture. Maghreb airlines also offer attractive alternatives for onward connections to Europe, North America and the Middle-East. However, traffic volumes remain modest, except in Casablanca for traffic originating francophone African countries to European destinations.
7. The major routes with Southern Africa traffic are to and from Johannesburg. Traffic with Eastern Africa comprises an important proportion of connecting traffic continuing to the Middle East and South Asia.
Intercontinental market
8. The intercontinental market is dominated by the traffic flows to and from Europe. It has steadily increased over the recent years at an average annual growth rate of nearly seven percent, i.e. about double world average during the same period. The collapse of two of the region’s major airlines, Air Afrique and Nigeria Airways, may have affected individual routes but had no negative impact on total traffic. Elimination of services on some routes was quickly substituted by alternative routings, demonstrating that there is some degree of competition between the carriers (at least on markets served by more than one long haul carrier).
22 9. In 2005, overall traffic volume with Europe is estimated at about 4.6 million passengers annually. The country with the largest air traffic with Europe is Nigeria (just under one million passengers p.a.), closely followed by Senegal, (over 900,000 annual passengers). Cape Verde ranks third with about half a million passengers, followed by Ghana. All other countries trail behind with traffic volumes under 300,000 passengers and most under 100,000. The first four countries (Nigeria, Senegal, Cape Verde and Ghana) account for about two-thirds of the total traffic recorded between Europe and the region’s 23 countries.
Benin Senegal Total Be 1g ium 66 66 Spain 129 129 France 79 539 61 8 United Kingdom 26 26 Italy 94 94 Portugal 88 88 Total 79 942 1,021
10. Among the European countries with scheduled air links with the two program countries (Phase I1 B), France ranks first with about 618,000 passengers, i.e. just above the 60 percent mark; Spain is second with 129,000 passengers, and Italy third with about 94,000 passengers. France-Senegal is the major route with over one-half million passengers.
11. The Middle-East market is growing, especially with the increasing role of Dubai as a trade hub between West Africa and Asia. A large number of charter flights are also operated every year during the Hajj period (pilgrimage to Mecca). Much of the traffic with the Middle-East is carried as sixth freedom via European or North African connections, traffic data based on direct air services tend to underestimate this market. Much of the traffic with the Americas is also carried via sixth-freedom connections. Direct traffic has fallen because all major US carriers phased out their services to the region whereas Air Afrique and Nigeria Airways, once the region’s major operators on the transatlantic route, disappeared from the market. South African’s fifth freedom services provide the major direct link between the region and North America.
Consolidated traffic results
12. Total air traffic of the 23 states amounted in 2003 to 11 million passengers p.a. (without double-counts) of which about nine million on international routes, i.e. less than two percent of the World total. Out of this total, about five million were recorded inside the region: three million as inter-state and two million as domestic. Long haul traffic totals six million, of: which Europe represents two-thirds (4.6 million) and the rest of Africa about one million.
23 Fares and costs
13. Airfares in the Western and Central Africa Region are considered up to 50 percent higher than world averages, thus hampering the development of traffic and the region’s economies. Historically, protectionist policies granting monopoly rights to state- owned airlines contributed to keep fares high. These barriers are now gone and new airlines were created in large numbers, but the size of the market remains small because of the low per capita income and barriers to the development of the tourism industry. This has an impact on air fares through less competition and higher costs, as fixed costs are spread over a smaller number of passengers, fleets and equipment are underutilized, etc:Jet fuel and other consumable goods used in air transport often have to be imported and are subject to all the extra costs associated with imported goods in developing countries. This is even worse in landlocked countries where jet fuel must be trucked over long distances from the ocean ports.
14. According to airlines, airport landing fees and air navigation charges in the region are more expensive than elsewhere in the world. The underutilization of equipment and facilities because of low traffic is a key factor to these higher costs.
15. High interest rates make the cost of aircraft acquisition higher, especially for “undercapitalized” airlines. Too many of the region’s airlines just do not have enough equity to support safe and sustainable operations. National regulatory authorities sometimes issue Air Operator Certificates without fully screening the applicants’ financial fitness. Low safety and security are also responsible for much higher insurance premiums.
The competitive context
16. With the elimination of the YaoundC Treaty system and the coming into force of the Yamoussoukro Decision, many of the most heavily trafficked routes in the inter-state market were operated in 2003 by more than two carriers: six on Bamako-Dakar, four on Abidjan-Lagos, three on Douala-Libreville, four on Cotonou-LomC, etc. However, such routes were not numerous, even though they carried the largest part of the traffic. Most other routes were served by only one or two carriers. On intercontinental routes, there was competition on the higher density routes: nine carriers on Lagos-Europe, five on Accra- Europe, seven scheduled carriers on Dakar-Europe (plus an even larger number of charter operators and 6th freedom connections offered by North African airlines). On the other hand, from Bangui to Europe there was only one carrier, with just one weekly service.
11. The Region’s Air Transport Industry
17. In the past six years, all of the region’s major legacy air carriers have gone out of business (Air Afrique and Nigeria Airways in 2002, followed by Ghana Airways and Air Gabon, and, recently Cameroon Airlines). New entrants, such as Air Senegal International, Virgin Nigeria as well as some of Nigeria’s new privately-owned domestic airlines have partly taken over the market previously served by these legacy carriers. However, they have been unable to fill the void completely and the WCA region’s air transport industry remains weak in the face of leading actors based outside the region. Air France-KLM continues to
24 be number one on the market, followed by Royal Air Maroc, British Airways, Emirates and South African Airways. The most remarkable change is the fast growth of North African carriers operating in 6‘h freedom to Europe, North America and the Middle-East via their Mediterranean hubs. Out of an estimated 13.2 million passengers generated in 2007 to, from and within the region, 3.9 million are recorded on domestic routes (chiefly in Nigeria), 1.7 million on interstate regional routes, and 7.6 million on routes with the rest of the world (half of this volume being carried by the five foreign carriers mentioned above).
18. With around five million passengers a year, Nigeria bears today the most active commercial aviation sector in WCA. The country has a large number of privately owned airlines which operate mainly on the country’s dynamic and highly competitive domestic market. For some carriers, this fierce competition led to a drop in the quality of service. Indeed, in April 2003, only 29 out of 34 airlines were cleared after CAA’s audit of private airlines. This number has since then dropped further to a mere 18.
19. The infrastructure sector comprises Air Traffic Management (ATM) service providers, airport authorities and airport management companies, and ground handling organizations. More than half the region’s countries are members of ASECNA. The organization was established in 1959 as “multinational statutory body” with its headquarters in Dakar and provides Air Traffic Services for the upper space international airports. The Robertsfield ACC is another multinational body operating ATM services for Guinea, Liberia and Sierra Leone, with its headquarters relocated at Conakry. Ghana, Cape Verde and Nigeria have their own ATM organizations.
20. Most of the region’s airports are part of the public sector with some cases of partial privatization through concession arrangements or service contracts. Ground handling services are either provided in monopoly or left to each airline’s initiative.
The role of air transport in the region’s development
21. The macro-economic weight of air transport in the region can be estimated between US$4 and 5 billion of which about 60 percent for the traffic to and from Europe, whereas inter-state and domestic traffic represent respectively about 15 percent and 8 percent.
22. Specific economic sectors would benefit from the improvement of air services: tourism, agriculture (especially for the export of off-season hit and produce), and manufacturing (especially for the supply of spare parts and the movement of maintenance crews). Air transport may also be an alternative for communications to landlocked or isolated communities, where it can resist the competition of cheaper land transport. It also provides job opportunities for qualified workers, especially in the technical and managerial specialties. Pilots and crewmembers are only the most conspicuous examples of such jobs. This is of particular importance in WCA countries which experience high rates of unemployment among higher education graduates.
25 111. Recent Events and Current Trends
The Yamoussoukro Decision
23. The Yamoussoukro Decision (YD) came into force on 12 August 2002, after a two- year transition period. This has not immediately revolutionized the air transport business, but has strengthened the legal status of the air carriers’ rights, in particular on fifth freedom sectors. On many routes, “third party” carriers (Le. carriers that are not nationals of either country on a sector between two countries) now offer fifth freedom services; it even happens that some sectors are only served by fifth freedom carriers. On some heavily trafficked routes, the number of carriers now operating can be quite high, thus ensuring effective competition, whereas providing more travel and connection opportunities to consumers and a choice of schedules. All in all, the industry’s executives and civil aviation officials are, on the average, rather satisfied that “the system works” and they feel relieved compared to what they feared when the YD came into force five year ago.
The collapse of Air Afrique and the end of the YaoundC Treaty
24. Air Afrique’s possible collapse has been considered a likely event ever since the early 1990s. All attempts to save the multinational carrier through “financial restructuring” eventually failed and the company had to stop its operations and file for bankruptcy on 8 February 2002. Air Afrique’s market share had consistently gone down from 1997 to 2002 and its traffic decreased even on sectors where total traffic was growing steadily. During the same period, Cameroon Airlines and Air Gabon were doing comparatively better on their own markets. This illustrated Air Afrique’s increasing inability to appeal to customers. As an immediate consequence, all speculations about “revising” or “updating” the YaoundC Treaty became irrelevant. Discussions about “reviving” the multinational airline under a different form have so far been unsuccessful, whether at the same level or at sub-regional levels such as CEMAC or UEMOA.
Consolidation forces in Europe’s air transport industry
25. Without going into details, considering the huge weight of the traffic to Europe as well as at the market share of European carriers in the region’s air transport business, events affecting Europe’s airline industry always have an impact for the region. Air transport liberalization of the 1990s is progressively reshaping the structures of Europe’s airline industry and transport patterns. Next steps are expected to be the “pooling” of traffic rights with the United States and possibly with some of West and Central Africa’s sub-regional groupings. As a result of this consolidation process, three carriers: Air France-KLM, British Airways and Lufthansa altogether hold 30 percent of West and Central Africa’s air transport business.
The emergence of new carriers
26. The emergence of new carriers has quickly provided a substitute to Air Afrique’s inter-state services in West and to a lesser extent Central Africa. They operate smaller aircraft, offer higher frequencies and schedules better suited to the demand. They also own
26 their fleet, are determined to’ “play by the rules” (comply with safety regulations, apply stable schedules and stable fare structures) and operate with a long term perspective. Some have the technical backing of a strong partner, such as Royal Air Maroc for Air Senegal and Air France for Air Ivoire. These recent developments confirms, however, that the future of these new airlines remains uncertain as Air Senegal has de-facto re-nationalized following the refusal of Royal Air Maroc to participate in its re-capitalization after incurring large operating losses while Air France has pulled out of its technical support to Air Ivoire. Likewise, Air Mauritania collapsed at the end of 2007 and the gradual expansion of the privately operated Air Burkina and Air Mali (same owner) will not compensate for the loss of services incurred since the disappearance of Air Afrique.
Prospects
27. Among the most widely used projections in the aviation community, there are those of the aircraft manufacturers. According to Airbus Industries’ projections, Africa’s economy should grow at an average rate of five percent over the next 15 years, thus strongly increasing the need for air transportation. For the 2007-2016 period, Africa’s traffic with North America Asia and the Middle-East is expected to enjoy more than eight percent of annual growth, while traffic with Latin America and Europe should grow respectively at six percent and five percent a year. Although intra regional traffic has been growing at a slow pace these past 20 years (three percent), it is expected to grow at an average of eight percent over the next 10 years.
27 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies
West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
COSCAP Project (Cooperative Development of Operational Safety and Continued Airworthiness)
1. Major donors including the ADB, the French Cooperation and the EU have agreed to finance under a grant agreement three COSCAP projects in WCA with one covering the UEMOA + Mauritania countries, one covering the CEMAC countries and one covering the non UEMOA countries within ECOWAS (also known as the Banjul Accord). These projects complement at the regional level the national activities that will be funded by this program.
2. The COSCAP’s main objective is to enable West and Central Africa to integrate the international civil aviation network by enhancing its civil aviation safety along the lines of the Yamoussoukro Decision policies. To achieve this objective, the following goals need to be reached:
Ensure reinforcement of aviation safety supervision capacity within the civil aviation institutions;
0 Establish economic and technical rules for aviation safety in line with the recommendations of the ICAO so as to enhance safety and efficiency within the civil aviation sub-sector; and Reduce the general costs of air transport.
To attain these objectives, the following issues need to be addressed:
Harmonization, elaboration and adoption of technical regulations for civil aviation safety; 0 Three autonomous and functional Regional Agencies for Aviation Safety (R4AS) must be created and the air transport safety supervision capacities must be enforced; 0 The capacity for coordination and follow up on the Yamoussoukro Decision must be enforced; and 0 Capacities for follow up and management of Regional Economic Communities (REC) must also be enforced.
28 Project Name COSCAP
Region West and Central Africa
Project Cost US$19.37 million (value of December 2004) - Communaute Economique et Monetaire d’ Afrique Centrale (CEMAC) Project Executives - West Africa Economic and Monetary Union (UEMOA) - Economic Community of West African States (ECOWAS) - ADB : US$6.74 million - French, UE, IFFAS coop: US$6.98 million - Others: (Boeing, Airbus, FAA): US$l.OO million Donors - CEMAC: US$l ,17 million - ECOWAS/GAB: US$1.17 million - UEMOA: US$1.05 million - Governments: US$1.25 million Implementation starting date May 2005
Project duration 37 months
29 Annex 3: Results Framework and Monitoring
West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
Table 1: Results Framework for program component PDO Outcome Indicators Use of Outcome Information Compliance rate with ICAO’s aggregate safety standards 1) Improve national CAAs’ based on ICAO’s audits, with all actions in their Corrective aompliance with ICAO’s safety Action Plan completed; standards Percentage of technical personnel in compliance with ICAO’s safety standards; and Total CAAs’ budget amount.
2) Increase national CAAs’ Compliance rate with ICAO’s aggregate security standards compliance with ICAO’s based on ICAO’s audit, with all recommendations addressed; security standards Percentage of CAA’s security inspectors, who‘received Measure improvements in: during the last three years a security training conforming to 1) CAAs’ compliance rates ICAO standards; with ICAO’s security and Level of CAA’s (Benin) and CAA and other entities’ safety standards, 2) targeted (Senegal) budget dedicated to security; and airports security levels, and 3) National Security Plan compliance with ICAO’s standards. sustainability of these improvements. 3) Enhance main international Percentage of airport security personnel with three or more airports’ compliance with years of experience; ICAO’s security standards Number of serious problems recorded during airport crisis exercises taking place annually (Benin) or every second year (Senegal); and Percentage of embarking passengers stopped in possession of illegal objects, as defined by the ICAO by private security personnel mandated by airlines or airport authorities, or/and by the National Police.
Intermediate Results Results Indicators for Each Component Use of Results Monitoring One per Component Component aviation safety
Compliance rates with e > 40% in Benin ICAO’s safety standards e > 80% in Senegal reach at least: Identify problems and Percentage of technical >30%inBenin associated solutions in CAAs’ personnel in compliance wii.. e > 70% in Senegal safety oversight capacity ICAO’s safety standards reaches at least: 1.3 in Benin CAAs’ total budget level reaches e 3.75 in Senegal at least (in FCFA billions):
30 Intermediate Results Results Indicators for Each Component Use of Results Monitoring One per Component Component aviation security 0 Compliance rates with 0 >6O% in Benin ICAO’s security standards 0 >60% in Senegal reach at least:
0 Percentage of Cas’ security 0 >40% in Benin inspectors, who received duting >6O% in Senegal Identify problems and the last three )‘ears a security associated solutions in CAAs’ training conforming to ICAO security oversight capacity standards:
CAA’s (Benin) and CAA and 0 328inBenin other entities’ (Senegal) budget 0 2,800 in Senegal le\ el dedicated to security reaches at least (in FCFA millions): Component airport security
0 Percentage of airport security 0 >45% in Benin personnel with at least three 0 >75% in Senegal or more years of experience:
0 Number of serious problems 0 <5 inBenin recorded during airport crisis 0 <5 in Senegal exercises taking place Identify problems and annually (Benin) or every associated solutions in second year (Senegal): international airport security measures
0 Percentage of embarking 0 <2% in Benin
passengers stopped in 0 <2% in Senegal possession of illegal objects as defined by the ICAO by private security personnel mandated by airlines or airport authorities, orland by the National Police.
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$1 m Annex 4: Detailed Program Description
West and Central Africa Air Transport Safety & Security Program Phase 2-B
Benin Aviation Sector and Program ComDonents
I. Overview
1. It is estimated that transport sector represents about seven percent of Benin’s GDP, and the improvement in transport infrastructures and related services would contribute to strengthen the country’s competitiveness, develop trade, boost economic growth, and reduce poverty. Despite various priorities and a limited budget, the government of Benin recently made an effort to improve the main airport of Cotonou through the extension of its aircraft parking capacity (from nine to twenty-three parking station, including one for large body aircraft) and the construction of a second taxiway. It also launched a study for the extension of the runway. However, government’s investments are not secured and only occur from time to time, depending on annual spending priorities.
2. Air transport traffic in Benin is rather modest, with a total around 315,000 passengers per year, concentrated at the international airport of Cotonou. Today, the aviation sector in Benin is organized around the following entities:
The Anence Nationale de I’Aviation Civile (ANAC), which is the authority in charge of the Civil Aviation. ANAC is an autonomous administrative entity established in 2004, replacing the former Civil Aviation Directorate (DAC). The ANAC has an annual budget of about FCFA 1.2 billion (or about US$2.6 million), which allows it to cover its operating expenses, and make few investments, mainly in buildings so far. Its resources come from security fees (3 8 percent), aeronautic development fees (45 percent), and concession fees (1 1 percent). Thus, ANAC is theoretically financially sustainable and should be able to invest more to maintain or acquire safety and security equipments in the future. The Anence pour la Se‘curite‘ de la Navigation Ae‘rienne en Afiiuue et h Madagascar (ASECNA), which is in charge of the management of both the country’s lower air space, and the Cotonou airport.
3. Besides, several foreign airlines (Air France, Air Burkina, Compagnie aerieme du Mali, Royal Air Maroc, Afriqiyah, Air Senegal International, Air Ivoire, Air Mauritanie, Virgin Nigeria Airways, and Kenya Airways) are operating long haul and regional flights to and from the country. There are also several private companies which are registered in the country (Benin Golf Air, Trans Air Benin, Aero Benin, West Africa Airways, Alafia jet, Cotair, Benin Littoral Airways, and a last one, Royal Air Benin, for which the registration process is in-progress), and several aircrafts are registered in Benin.
34 11. National Aviation Issues
4. A host of issues affect day-to-day operations of the aviation sector in Benin. Among the most pressing ones are the following:
Insufficiencies in technical staff Benin’s conformity rate with ICAO’s standards is very low, regarding safety issues: only 20 percent for the overall assessment, with specifically catastrophic results for the CAA personnel’s qualifications and competencies (only a little bit more than 1 percent). These results are among the worst ones in the region, and demonstrate a lack of valuable technical staff within the ANAC, both in terms of quality and quantity. Governance: ANAC is collecting fees amounting yearly about US$3 million, yet it only recruited this year an external auditor who is analyzing its financial statements since its inception. The preliminary audit results raise questions some aspect of ANAC’ s financial management and procedures and particular attention should be paid to how the organization proposes to address these remarks.
0 Obsolete legislation: Benin’s Civil Aviation Code was adopted in 1962 and was never updated or complemented. As a result, the country’s legislation and regulations were continuously rated as “non-conform” by ICAO because of out-dated provisions or inexistent regulations. The ANAC has then no legal or regulatory reference to fulfill its duties whereas those are its key work instruments.
0 Bonuses; The CAA pays bonuses to the personnel of the private security companies deployed at Cotonou airport whereas the civil servants working in the law enforcement agencies (Le., police, gendarmerie and customs agents) directly submit their own service invoices to air carriers, without any control of the basis of their calculations, nor their true distribution among the so-called beneficiaries.
Table 1: Benin - ANACs financial statements
(millions) I (thousands) (millions) 1 (thousands) Revenues 1US$ = 539 FCFA 1US$ = 532 FCFA Operational Revenues 1,272.2 2,360.3 906.3 1,704.0 Subsidies 74.8 139.0 35.0 65.8 Total Revenues 1,347.0 2,499.3 941.3 1.769.3 costs Purchases 95.1 176.5 42.8 80.5 Transports 0.2 0.4 0.3 0.5 External services 149.0 276.5 138.2 259.7 Other costs 17.4 32.4 I 17.7 I 33.3 Labor costs 299.0 554.8 I 211.2 I 397.0 Depreciation expenses 77.4 143.7 90.0 169.0 Financial Costs 0.2 0.4 0.1 0.2 Total costs 638.5 1,184.6 500.3 940.4 Net income 708.5 1,314.7 441.0 829.0
35 111. Addressing National Aviation Issues
5. Based on the observations made during the program preparation, as well as the data provided by the local aviation authorities, a specific action plan for the ANAC and other aviation related entities was developed. This plan represents an answer to the specific issues raised and complements the activities financed by the Government and the ANAC. It is:
e Insufficiencies in technical staff ANAC will gradually recruit technical staff to reinforce the existing ones and the Program will finance staffs training based on a training plan to be approved by the Bank. Staffs qualification will be evaluated independently by an independent qualified team during the program’s mid-term and end term review. e Governance: Additional fiduciary control will be implemented through the recruitment of an independent international auditor in order, not only to review the conformity of the financial statements with standard international practices, but also, to advise on how to ensure long term sustainability of ANAC. e Obsolete legislation: After ICAO’s audits, the CAA undertook a long and thorough review of the legislation. Consequently, a new Civil Aviation Code is being drafted to address ICAO’s remarks and is scheduled to be published before the end of 2008. The new code should allow ANAC improve significantly its compliance rate with ICAO’s standards. In order to help ANAC in this important endeavor, the program will finance technical consultants to ensure the code’s relevance to ICAO’s standards. e Security uersonnel bonuses: a thorough study will be carried out to review the current system to ensure its fairness and consistency as such bonuses should be paid transparently to all the personnel involved in airport security activities.
IV. Program Components and Detailed Activities
6. On the basis of the shortcomings and needs previously identified, an investment list covering the national needs of the aviation sector in Benin was developed. Its total estimated cost stands at US$lO.O million. In order to provide a comprehensive view of the allocation of funds, the activities to be financed under the project have been detailed and classified in the following categories:
i) Personnel training; ii) ANAC equipment; iii) Aviation’s communicatiodnavigational aid equipment; iv) Airport security equipment; 4 Crisis center equipment; vi) Airport infrastructure equipment; vii) Consulting services and miscellaneous; and viii) Program management (including Client in-kind contribution).
36 Table 2: Program costs by activity and category (in US$ millions)
a) Personnel training
7. The aim is to mainly enhance ANAC’s personnel knowledge base and its experience in aviation safety and security. Therefore, training for safety oversight personnel as well as security training for the key operational personnel, including those working at Cotonou airport will be undertaken. An assessment study of the existing personnel skills will be carried out in order to identify the specific needs for emergency training. The fields of training will encompass aviation safety (CNS/ATM - Communication Navigation SystedAir Traffic Management and avionics, etc.), and security (screening equipment technology operations and maintenance for the users ofthe newly acquired equipment, etc.). Total program cost for this activity is estimated at US$1.47 million. b) ANAC equipment
8. The equipment to be acquired for ANAC will help complete its technical library, enhance its personnel training center and deploy a centralized telecommunication system between the ANAC’s headquarter and its departments as well as the key entities working at Cotonou airport. This will be done to facilitate inner communications and improve overall productivity. Overall cost for this activity is estimated at US$0.79 million. c) Aviation equipment
9. The acquisition of communication (VHF; Talkie-walkie) and radio equipment, as well as equipments and vehicles for Search and Rescue (SAR) activities is designed to improve field communication capacity ofANAC’s personnel and remedy the lack of Search and Rescue (SAR) capacity. Total cost for this activity is estimated at US$2.82 million. d) Airport security equipment
10. Explosive material tracers as well as smaller security equipments, such as telescopic mirrors, will be procured and installed at the airport of Cotonou, to enhance the airport security. Likewise, five x-ray machines for freight and passenger luggage screening will be purchased. The deployment of these new machines at Cotonou airport will ensure that 100
37 percent of all cargoes and luggage placed on board airplane operating from the airport have been screened. Total cost for this activity is estimated at US$1.53 million. These purchases will allow the redeployment of some older hardware to Parakou airport as soon as it is operational. e) Crisis center equipment
11. A building dedicated to airport crisis management is under construction at Cotonou airport. Its equipment will be financed under the program for an estimated cost of US$O.13 million. f) Airport infrastructure equipment
12. The airport will be equipped with a closed circuit television monitoring systems in order to meet the international security and safety standards. This investment is to be complemented by appropriate training of the personnel operating such system. Total cost for airport infrastructure upgrade is estimated at US$0.75 million. g) Consulting services and Miscellaneous
13. This activity covers the various items such as consulting services related to capacity strengthening, program audits. Total cost for these items is estimated at US$0.93 million. h) Program management
14. This activity covers the program management costs and the Client in-kind contribution, such as office spaces and supplies, the salary of the PCU personnel allocated to the Program implementation. Total cost for these items is estimated at US$l.58 million.
38 Senegal Aviation Sector and Program Components
Overview
15. The government of Senegal is ambitious to position its capital city, Dakar, as a hub in West Africa for air traffic to and from Europe, North America, and South America. To this end, a new international airport Blaise Diagne will be constructed in Ndiass. This new international airport will be financed by a “Fee for the Development of Airport Infrastructure” currently collected on passengers using international airports in Senegal. As a matter of fact, it is estimated that the capacity of the current main international airport of Senegal, Dakar Ldopold Sedar Senghor (L.S.S.) is not sufficient to absorb the traffic of passengers and cargo which are projected to reach about three million (vs. less than two million now) and 54,000 tons in 2020, respectively. Nevertheless, the current state of Dakar International Airport in terms of safety and security is adequate as the airport is allowed to offer direct flights frodto the United Stated of America. However, as Senegal is not rated by the US FAA as IASA Category I,these flights can only be operated by carriers registered in countries rated Category I.Accordingly, Senegalese registered carriers cannot for now provide passenger and cargo services to North America.
16. Today, the aviation sector in Senegal is organized around the following entities:
The ANACS, which is the Senegalese authority in charge of the Civil Aviation. ANACS is an autonomous administrative entity established in 2002. It became operational in mid-2003 when it replaced the former Civil Aviation Directorate (DAC). It is under the authority of the Minister in charge of air transport. ANACS has an annual budget of FCFA 3.42 billion (or about US$7.6 million), stemming mainly from users’ fees (more than 85 percent), including civil aviation fees (about 40 percent), concession fees from airport management entities (30 percent) and handling companies (1 5 percent). Unlike similar authorities in Africa, ANACS collects very little security fees even though it is in charge of security supervision. However, ANACS budget seems sufficient to ensure its financial sustainability, at least when it comes to covering its operating expenses. Its capacity to invest and maintain safety and security equipments has yet to be demonstrated, however. The Anence pour la Se‘curite‘ de la Navigation Ae‘rienne en Afiiaue et 6 Madanascar (ASECNA,) which is in charge of the management of the country’s lower air space. The Authoritv for National Aeronautical Activities (AAANS, ) which is responsible for the management of airports in Senegal pursuant to a Particular Agreement signed between the government and the ASECNA. The High Authoritv of Le‘opold Se‘dar Senghor Airport (HAALSS), which is responsible for the coordination and implementation of security measures at Dakar International Airport. Its activities are financed by the security fees it collects on passengers using the airport.
39 National Aviation Issues
17. A host of issues affect day-to-day operations of the aviation sector in Senegal. Among the most pressing ones are:
Governance issue regarding the security fees: there is a lack of transparency in the collection, management and use of the security fees. To-date, there is no separate accounting records and no external control of these fees. It is estimated that the overall security fees collected in 2007 amounted to US$5 million, with almost half of it transferred to HAALSS, and the rest, kept by the AAANS for, theoretically, being used to financed investments to be made on behalf of the HAALSS. In addition, there is no legal text establishing the sharing mechanisms for these fees among the two beneficiary entities. Instead, the distribution is based on a simple and non-motivated decision of the Minister in charge of air transport. As a result, ANACS never receives a portion of these fees (except in 2005 when it got US$400,000), and is not relying on them for its budget. Lack of autonomy of the entity in charge of aircraft incidents and accidents, which has been signaled several times to Senegal by ICAO. For the time being, such task is assigned to ANACS with the result ofnot guarantying any due process.
Source: ANAC Addressing National Aviation Issues
18. Based on the observations made during the preparation mission, as well as the data provided by the local aviation authorities, the Bank’s Team devised a specific investment program for ANACS and other aviation related entities. This investment program represents an answer to the specific issues raised and complements the activities financed by the Government and the ANACS.
40 On the governance issue regarding the securitv fees: The current situation is not normal, because ANACS is the official entity in charge of aviation security supervision. It is rather the intervention of the AAANYASECNA, the airport management entity, in the collection and the management ofthose fees which raises a host of issues. Accordingly, a review of the whole payment and collection mechanism will be undertaken in order to clarify each entity’s contribution in air transport security activities in order to propose the most adequate system. On the lack of autonomv of the entity in charge of aircraft incidents and accidents: The Program will help the Government create an autonomous Office for aircraft incidents and accidents.
4. Program Components and Detailed Activities
19. On the basis of the shortcomings and needs previously identified, an investment list covering the national needs of the aviation sector in Senegal was developed, with total investment estimated at US$8 million. In order to provide a comprehensive view of the allocation of funds, the activities to be financed under the program have been detailed and classified in the following categories: i) Personnel training; ii) ANACS equipment; iii) Aviation communication/ navigational aid equipment; iv) Airport security equipment;
VI Crisis center equipment; vi) Airport infrastructure equipment; vii) Consulting services and miscellaneous; and viii) Program management (including Client in-kind contribution).
Table 4: Program costs by activity and category (in US$ millions)
I Total I 8.00
41 a) Personnel training
20. The aim is to enhance the knowledge base and the experience in aviation safety and security staff, mainly of ANACS personnel. Therefore, training for safety oversight personnel as well as security training for the key operational personnel, including those working at Dakar Leopold SCdar Senghor Airport will be undertaken. An assessment study of the existing personnel skills will be carried out in order to identify the specific needs for emergency training. The fields of training and exercises will encompass aviation safety, air traffic control, crisis management, and Search and Rescue (SAR). Total estimated cost for this activity is estimated at US$2.03 million. b) Agency equipment
21. The equipment to be acquired for the ANACS will be aimed at completing its technical library and its personnel training equipments, enhancing its management of airport slot allocation as well as improve its overall productivity. This will include medical equipment which will be used to carry normal medical checks (i.e., vision test, lung x rays, urine and blood tests) for the limited numbers of aircrews which are licensed in Senegal (i.e., less than 50). These checks will be done by a doctor under contract with ANACS who will be responsible to dispose properly and safely of any any medical supplies used to administer these tests. Overall cost for this activity is estimated at US$1.80 million. c) Aviation equipment
22. The acquisition of communication (VHF; Talkie-walkie) and radio equipment, as well as equipment and vehicles for SAR activities for ANACS aims at improving the field communication capacity ofthe Agency’s personnel. Total cost for this activity is estimated at US$O. 16 million. d) Airport security equipment
23. As mentioned above, security equipment is not an issue for Dakar LCopold Sedar Senghor Airport. e) Crisis center equipment
24. Field missions have revealed that there is already a crisis management centers at Dakar Ldopold Sedar Senghor Airport, and the eventual upgrading of its equipment was not selected as a priority for the current Program’s financing. f) Airport infrastructure equipment
25. Investment is needed for a closed circuit television monitoring systems at Dakar LCopold Sedar Senghor Airport. These investments are to be complemented by appropriate training of airport personnel. Total cost for airport infrastructure upgrade is estimated at US$0.75 million.
42 g) Consulting services and Miscellaneous
26. Besides the activities related to capacity strengthening and program audits, this category covers various consulting services aimed at: (i)supporting ANACS in updating its technical regulations, translating them into English and disseminating them; (ii)helping the Government and ANACS set up an office for aircraft incidents and accidents; and (iii) reviewing the overall system for the collection and the management of security fees, in accordance with the effective responsibilities ofeach agency involved in this process. Total cost for these items is estimated at US1.88 million. h) Program management
27. This activity covers the PCU’s related management and operating costs, as well as the Client in-kind contribution, such as office spaces and supplies, the salary of the PCU personnel allocated to the Program implementation. Total cost for these items is estimated at US$1.38 million.
43 Annex 5: Program Costs West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
Program Costs by Component Local Foreign Total andlor Activity US$ million US$ million US$ million Personnel training. 0.00 1.47 1.47 ANAC equipment I 0.00 0.79 0.79 Aviation equipment 0.00 2.82 2.82 Airport security equipment 0.00 1.53 1.53 Crisis center equipment 0.00 0.13 0.13 Airport infrastructure equipment 0.00 0.75 0.75 Consulting services & miscellaneous 0.00 0.93 0.93 Program management (incl. Client 1.oo 0.58 1.58 in-kind contribution) Total 1.00 9.00 10.00
Program Costs by Component Local Foreign Total andlor Activity US$ million US$ million US$ million Personnel training 0.00 2.03 2.03 ANACS equipment 0.00 1.80 1.80 Aviation eauinment 0.00 0.16 0.16 Airport security equipment 0.00 0.00 0.00 Crisis center equipment 0.00 0.00 0.00 Airport infrastructure equipment 0.00 0.75 0.75 Consulting services & miscellaneous 0.00 1.88 1.88 Program management 1.oo 0.38 1.38 Total 1.00 7.00 8.00
44 Annex 6: Implementation Arrangements and Monitoring Plan for Good Governance
I.Program Implementation mechanisms
I.1. Regional Coordination
1. The implementation of the program is done on a country basis, using the arrangements agreed with each government. The African Development Bank and other donors are funding all activities relevant to the regional coordination of the program which are implemented by the respective Regional Economic Communities (RECs) (Le. the UEMOA, ECOWAS and CEMAC Secretariats). Therefore, the fiduciary elements of this coordination are not spelled out in this Annex which focuses mostly on implementation arrangements of the Benin and Senegal credits funded under the program. No program- funded activity per se necessitates simultaneous involvement of two or more countries. In Benin and Senegal, the program will be implemented by the ANACs established on October 29,2004 by Decree 2004-598 at the Ministry ofPublic Works and Transportation for Benin and on May 21, 2003 by Decree 2003-384 at the Ministry in charge of Transportation for Senegal. The ANACs will manage procurement and disbursement activities and will have financial autonomy. Additional staffing for the ANACs will be recruited and/or trained on World Bank’s procedures when deemed necessary.
2. In both Senegal and Benin, the ANACs will have to report back respectively to the Ministry of Public Works and Transportation and the Ministry of Infrastructure, Land Transport and Air Transport. Separate Financing Agreements will therefore be signed between the governments of Benin and Senegal and IDA. In addition, subsidiary agreements will be signed between the governments and the ANACs, and Project Agreements between IDA and the ANACs.
I.2. Arrangements in each country
Fiduciary Agencies (FAs), Technical Implementation Agencies (TIA) and Technical Teams (TTs).
3. In Senegal, the program will have at least three direct beneficiaries: the ANACS, the HAALSS and the aircraft Accidents and incidents Investigation Office (AIO) which will be set up with the program’s support. In order to simplify the program’s management, it is proposed to concentrate its fiduciary responsibility within the ANACS so as to make it the Fiduciary Agency (FA). The ANAC, therefore, will act as the fiduciary responsible for the support it receives and for those received by the other beneficiaries. These beneficiaries will remain in charge of the technical implementation of their activities (through Technical Implementation Agencies or TIA) and will appoint technical teams (TT) to follow up the implementation. In Benin, the implementation arrangement is different since the program’s beneficiary is essentially the ANAC. However, in both countries, several structures external to the administration of civil aviation will also benefit from the project through training programs, and sometimes through the provision ofequipments for their operation. 4. The performance of the ANACs will be reviewed jointly by the Ministries of Finance and Publics Works and Transportation in Benin and by the Ministry of Finance and
45 the Ministry of Infrastructure, Land Transport and Air Transport in Senegal. The reviews will take place on a regular basis as well as during Bank’s supervision missions at least twice a year. Remedial measures will be taken in case of problems or non-performance.
5. The general organization of the program in each country, including its supervision at the regional level, is described in the diagram below :
lementation arrangements dese in the section loped in the sections related to as the same mechanisms
6. The ANACS will be the main fiduciary agency because it is the guardian of government’s sovereign responsibility in terms of aviation sector’s international commitments and issues as well as will benefit from the majority of the activities to be financed by the Program. To this end, the ANACS fiduciary management capacity will be strengthened.
46 7. Meanwhile, each TT will be led by a manager under the direct authority of the chief executive officer (CEO) or the executive secretary of each organization (in the case of the HAALSS, it would be a Senior Officer, and in the case of the ANACS, it would be the project coordinator himself), and by the head of the AI0 once it is set up within the Ministry. Coordination between technical and fiduciary responsibilities will follow the principles outlined below, with mechanisms of internal and external controls also described as follows (see below for further details).
Table 1: Implementation nd good governance COI trol arrangements Technical FYduciaqImplementing. ' @Fey AgencyfTIA) Go ernanre Control ANAC in Benin @ ANACS, ' and HAAZSS, and AIO (once it is set Senegal Benin c yzr up)' ig Senegal ,- Existence of an internal Existence of an internal audit and control audit and control function function (ANAC), Ministry General All activities II (ANAC S) Inspection department, MDCTTP Design of the Risk analysis (Steering Risk analysis (Steering Committee, program scope and X Committee, ANACS) ANAC) activities Costing of X activities Realism check (Steering Committee and Realism check (Steering Implementation ANAC). Elaboration of a procurement X X Committee, HAALSS and program plan to be approved by the IDA before ANACS) implementation Procurement : Systematic checks to detect Systematic checks to ensure the Technical collusion or fraud cases impartiality of the Terms of Reference / specifications/ X (Internal Auditor - ANACS, Technical Specifications (Internal Auditor Terms of Markets Authority (DCMP - ANAC, Markets Authority (CPMP DNMP Reference (TORS) Ministry of Finance) - Ministry of Economy and Finance)) Verification of certain ex-post and ex ante Check of selected ex-post to ensure compliance with procedures, Procurement: X X and ex-ante methods transparency of the process and neutrality bidding documents (internal auditor, DCMP) of content (internal auditor, IG MDCTTP, CPMP, DNMP) ~ ~~~ ~~ ~ Issuance of Expression of X Interest Ex-post and ex-ante control (Markets Commission, Ex-post and ex-ante control (ANAC Procurement: Markets Authority (Internal Internal Auditor, CPMP, DNMP for evaluation of bids / X Auditor, DCMP for amounts amounts above the threshold of public proposals above the threshold of public procurement code)
I procurement code)
47 ernance Control
Activity +
Benin Ex-post and ex-ante control (Markets Commission, Ex-post and ex-ante control (ANAC Procurement: Markets Authority (Internal Internal Auditor, CPMP, DNMP for evaluation of X Auditor, DCMP for amounts amounts above the threshold of public bidstproposals above the threshold of public procurement code) mocurement code). Check of the conformity of contracts’ contents by the Financial Controller, Contract possible remedies of bidders to an X awardlsigning independent organ (CNRMP), apriori review and aposteriori annual review of the IDA Technical control Controls (by Technical and technical Controls (by Technical Commissions, X Commissions, Internal certification of Internal Auditor) Auditor) activities Financial audits Payment requests X Financial audits (Independent consultants) (Independent consultants) Appeals (DG ANACS, ARMP, (DG ANAC, Regulatory Commission in mechanism t Conciliator, Justice) charge of public contracts) Remedies Control of External Audit, internal External audit, internal check, Audit adequate project check, Audit Bench Bench, General Inspections MDCTTP audits (Chambre des comDtes)
Organization of the fiduciary agencies (FA) and description of arrangements
8. In Benin, the ANAC has a Chief Financial Officer, an Assistant in charge of accounts and accounting staff, a Procurement Officer within the Department of infrastructure, and an Internal Auditor. In Senegal, the fiduciary team of the ANACS will consist of a Chief Financial and Administrative Officer, a Chief Accountant and an accountant staff. The fiduciary team of the ANAC in Benin will be strengthened by two consultants (a Procurement Specialist and a Financial Management Specialist), while in Senegal, a Procurement Specialist (funded by the program), a Financial Manager and an Internal Auditor (using ANACS’ financing) will be recruited. The activities of the ANACs and their annual financial reporting will be subjected to reviews by independent external auditors which will be hired in accordance with Bank’s procedures and funded by the program. The individual consultants will be hired before the credit’s effectiveness and will be appointed for an initial period of one year, based on a renewable contract depending on their performance and the needs of the program. They will complement the technical (or financial) and procurement expertise of the ANACs members already in place. Their terms of reference will include a clear obligation to train their ANACs counterparts in order to strengthen their capacity.
48 9. The TTs and FAs will be established on the basis of terms reference acceptable to the World Bank and staffed with employees with qualifications and experiences also acceptable to the Bank. The Bank will review the draft terms of reference for the TTs and the CVs ofthe proposed current or future staff.
10. The TTs’ capacity can be strengthened to allow them to implement their respective components on a day-to-day basis in line with procedures governing the program’s preparation and implementation. Particularly, in the case of Senegal, each team leader (HAALSS and AIO) will have direct access to the project coordinator, especially for implementation issues, without having to go through the administrative proceedings and hurdle of having the ministerhead of structure sign off each correspondence addressed to other structures.
11. There is sufficient technical knowledge within the ANACs to ensure: (i)the elaboration of preliminary technical documentation in support of the activities to be undertaken by each Agency and contained in its procurement plan, and (ii)the supervision of the program implementation in the field, as well as the reporting activities to their General Director. Nevertheless, it was agreed that consultants recruited nationally using Bank’s procedures may punctually assist the current staff and help the agencies to build their management and program implementation capacity.
12. In Senegal, ANACS’ project team will be comprised ofthe following staff:
Fiduciary Team:
0 A Coordinator;
0 A Chief Financial Officer;
0 A Management Controller;
0 A Chief Accountant; 0 A Procurement Consultant (to be recruited from outside the structure); and
0 An Internal Auditor.
Technical Team: 0 The Director ofControl and Security; and
0 The Director ofNavigation.
Within the HAALSS, the Technical Team will include:
0 The Focal Point (Chief Administrative and Financial Officer); and
0 The Head ofsecurity control ofthe Dakar airport
Within the AIO, once it is set up, the Head ofthe AI0 will act as the focal point.
13. In Benin, ANAC’s project team will be comprised ofthe following staff:
Fiduciary Team:
0 A Coordinator;
0 A Chief Financial Officer;
49 0 A Procurement Manager (head ofthe infrastructure service); A Financial Specialist (to be recruited using the program’s funding);
0 An Accountant; 0 A Procurement Consultant (to be recruited); and The General Inspection department within the Ministry in charge of Transport which will fulfil the duties of Internal Auditor.
Technical Team: 0 The Director ofAir Operations; and 0 The Coordinator of Security at the airport of Cotonou (chief of airfields in Benin for the ASECNA) .
14. Oversight: the Ministry in charge of Transport and Public Works in Benin and the Ministry of Transport in Senegal will be responsible for the overall oversight of the program. The respective ministries will carry out overall oversight, provide policy direction, and solve any problem that may hamper the preparation and implementation ofthe program. These ministries will chair the Program Steering Committees (SC) which will meet quarterly to review the status ofthe development program and its performance. This review process will be based on the quarterly financial management reports as well as procurement and program implementation reports prepared by the ANACs. The General Director of each ANAC will provide the secretariat ofthese steering committees.
15. Monitoring and Evaluation: The performance indicators of the project listed in Annex 3 must be monitored carefully by the ANACs on a quarterly basis, taking into account the data provided by each operational department in charge of safety and security, and by security companies operating at the airports. In addition, at the project mid-term and 6 months before its end date, a full audit in line with ICAO’s methodologies will be conducted by an independent consultant funded by the project to estimate the values of all project’s indicators.
I.3. ANACs and Program Steering Committees Scope of Services
Program Coordination Unit (PCU)
16. The Program Coordination Unit in each ANAC will perform the daily management of the program based on the applicable provisions of each Financing Agreement and any other applicable agreements (Le., Project Agreements between each ANAC and IDA and Subsidiary Agreements between each ANAC and their respective governments).
17. Specifically, each country’s ANAC will implement the following program management activities (also see Table 1):
0 Prepare the program implementation plan; 0 Select consultants in accordance with the procedures ofthe Bank; 0 Carry out tenders for goods and services using Bank’s procedures;
0 Prepare program’s contract documents;
50 e Prepare tender documents; e Evaluate bids; e Undertake contract negotiations; e Facilitate the issuance of awards; e Liaise with the Bank as part of its coordinating role; e Discuss detailed program activities with consultants, suppliers and businesses; e Facilitate mobilization ofcompanies and consultants; e Facilitate customs clearance where applicable; e Oversee and monitor consultants and suppliers; e Oversee the program implementation at all levels; e Write procedures for receiving, verifying and paying bills on time; e Ensure the expedient payment of consultants, suppliers and contractors; e Prepare and submit progress reports in an expedient manner; e Ensure that financial audits are conducted on time; e Conduct the monitoring ofperformance indicators; and e Keep track ofprogram’s records, reports and information.
Responsibility of ANACs’ Project Coordinators
18. The Project Coordinator within each ANAC will be in charge of the program’s leadership. As such, he/she will:
Be in charge of daily activities; Plan, manage, monitor and coordinate the components of these activities; Implement the program in line with the global plan of operations and schedules of activities and report changes thereto; Monitor contractual compliance of consultants, suppliers and contractors’ performances; and Ensure that a structured and consistent monitoring of implementation progress exists, including quarterly and annual reports and performance indicators.
Program Steering Committee (SC)
19. The Bank has approved the following line-ups as proposed by Benin and Senegal’s ANACs:
Senegal Chairman: The ministry in charge ofcivil aviation or his representative.
Members: A representative of the Directorate of Economic Cooperation and Finance of the Ministry ofFinance; A representative ofthe airport police; Two representatives of the Ministry of the Armed Forces (Minist2re des Forces Arme‘es);
51 0 The General Secretary of the High Authority of the Leopold Sedar Senghor Airport (Haute Autorite' de 1 'Ae'roport Le'opold Se'dar Senghor, HAALSS) or his representative; 0 The General Director of the Airports of Senegal (Ae'roports du Se'ne'gal, ADS) or his representative; The General Director of Meteorology of Senegal or his representative; The person in charge of the aircraft Accident and Incidents Investigation Office (AIO), when the office is created.
Benin Chairman: 0 The Deputy Minister of Land Transport, Air Transport, and Public Works (Ministre De'le'guk, auprBs du Pre'sident de la Re'publique, Charge' des Transports Terrestres, des Transports Ae'riens et des Travaux Publics (MDCTTTATP/PR)).
Members: 0 A representative of the Ministry in charge of Forcasting, Development and Monitoring of Public Action (Minist&-e charge' de la Prospective, du De'veloppement et de 1'Evaluation de 1 'Action Publique - Direction Ge'ne'rale des Investissements et du Financement du De'veloppement ); 0 A representative of the Ministry of Economy and Finance (Independent Amortization Fund : Caisse Autonome d 'Amortissements) 0 A representative of the Ministry of Interior and Public Safety (Ministire de 1 'Inte'rieur et de la Se'curite' Publique); 0 A representative of the Ministry of National Defense (MinistBre de la De'fense Nationale); 0 The Managing Director of the National Civil Aviation Agency ; and 0 The Director of Planning and Forecasting of MDCTTTATP/PR (provides the Secretariat of the Steering Committee; Directeur de la Programmation et de la Prospective du MDCTTTATP/PR).
Responsibilities of the Program Steering Committee (SC)
20. The SC in each country will be responsible for:
0 Providing support and resolving any issues that may hamper project implementation and would require interventions from other ministries or departments of the government;
0 Providing policy direction on matters relating to the project preparation and implementation;
0 Carrying out risk assessments, particularly of fiduciary risks, related to the program's implementation, in line with the current ongoing dialogue on governance issues between the World Bank and the government; 0 Assessing reports regarding program internal controls which will be delivered by the internal auditor of the ANACS (Senegal) and the general inspections of the Ministry of Transport (Benin); and
0 Supervising and monitoring the program's performance indicators.
The SC will meet at least quarterly.
52 Responsibilities of General Directors, Ministers, and supervision Ministries
21. The DGs and heads ofthe TIA will jointly be responsible for:
0 Providing support and resolving any issues that may hamper the program’s implementation and would require interventions from other ministries or departments of the government; Providing policy direction on matters relating to the program’s preparation and implementation; and
0 Carrying out risk assessments of fiduciary risks related to the program’s implementation, in line with ongoing dialogue on governance issues between the World Bank and the government.
11. Good Governance Monitoring Plan
11.1. Main risks of corruption - inherent risks
22. The main risks of corruption, as well as the mitigation measures that will be established, are listed in the matrix below.
Table 2: Risks and Mitigation Measures .of Corruption Situations vulnerable to Concerned Risk Mitigation measures corruption entities ANAC and (i)Strengthening fiduciary systems of ANAC; Lack of administrative and Technical and (ii)Text reforms, notably to provide ANAC with legal personality; financial autonomy (risk of financial (iii)Securing ANACs’ resources through the use of equity inappropriate interference in High Supervision resources (mainly from aeronautical charges); and management) of ANACs Ministries (iv) Monitoring ANACs’ budgets, their development and their use, particularly to strengthen the supervision of safety and security. (i)Measures to strengthen the capacity of these agencies through Lack of capacity and experience trainings (initiation and training on the job), recruitment of of Fiduciary Agencies for experienced specialists (which will also have an obligation to train procurement procedures of the High ANAC these agencies’ staff); Bank (risk concerning (ii)Implementation of control mechanisms at various levels procurement and use of assets) (control and internal audit, external audit as well as roles dedicated to the leaders of these agencies, and to the Steering Committees). Senegal: lack of traceability of ADS and the collection and management technical Independent audit of financial statements of the new ADS. High of safety charges supervision Ministry
11.2. Control risks
23. In order to mitigate risks, many control mechanisms will be established. The main tool for governance control will be to give responsibility to a structure that will guarantee respect of basic governance and transparency principles at the program level. These principles, when it comes to their fiduciary aspects, are listed in the Table below. In each country, a structure will be designated to oversee these aspects. In Senegal, the Steering
53 Committee (SC) will be in charge of producing a bi-annual report on governance issues independently from the TIAs. In Benin, it is proposed that this role be assigned to the General Inspection Department, within the Ministry ofTransport.
24. In both countries, the following institutions are already in place for the purpose of governance monitoring:
Table 3: Institutions for Governan :Monitoring Index Area Sen e e a 1 Benin General Inspection Departments General Inspection Departments Interna 1 (Inspections (Inspections control and Gknkrales Ministkrielles and Inspection Gknkrales Ministkrielles and Inspection Gknkrale auditing Gknkrale d’Etat) d ’Etat) 0 Internal auditors in autonomous structures 0 Internal auditors in autonomous structures
0 Existence of a Procurement Regulation Agency 0 Review of the Procurement Code or ARMP Existence of a Central Department for Existence and operation of a National Public public contracts Procurement or DCMP within Tenders Regulation Board (CNRMP)
the Ministry of Finance 0 Existence of a control entity: National Department 0 Public Tenders Boards and Entities in charge of of Public Procurement (DNMP) within the Ministry Public the Control of Public Tenders within ministries of Economy and Finance
contracts and public structures are operational 0 Procurement Units (CPMP) in charge of 0 Existence of Administrative and judiciary procurement and contracts control for contracts sanctions to infraction against the Procurement below the thresholds fixed in the Codes are Code operational within the ministry
0 Existence of Administrative and judiciary sanctions to infraction against the Procurement Code CNLCC (National Board of Fight against 0 FONAC” and ALCRER16 which are civil society Corruption and Non-transparency) organizations, very active in the denunciations of DREAT (Delegation for State reform and Fight corruption cases technical assistance), under the supervision of the against Observatory for the Fight against Corruption (OLC) General Secretariat of the Republic Presidency, corruption 0 Transparency International and in charge of the implementation of the Nouvel Ethique National Good Governance Program 0 0 ELAN 0 ANTF External The recruitment of an auditor and the audit and implementation of the recommendations of the Audit Bench (judicial control) rendering of audit reports are carried out by the CAP of the 0 Budgetary and financial Disciplinary Board (CDBF) annual Ministry of Economy and Finance 0
accounts 0 Audit Bench (judicial control)
11.3. Action Plan
25. In order to reduce implementation risks, mitigate corruption risks, improve governance and sustain the program’s achievements beyond its term, measures related to the program’s fiduciary management will be strengthened (Le., see institutional arrangements in Annexes 7 and 8). These will come in addition to those measures specifically intended to mitigate the corruption risks identified above.
26. Some controls are thus either already effective, or to be established in the very short term, such as the following:
’’ FONAC = Front National des Organisations contre la Corruption l6ALCRER = Association de Lune Contre le Racisme, 1’Ethnocentrisme et le RBgionalisme
54 i) The a priori control (by IDA and by various entities of public procurement control) - as discussed above as well as in Annexes 7 and 8 of this Project Assessment Document. During the implementation phase of the program, the Bank, through its supervision missions, will especially ensure the respect of governments’ commitments on improving governance; and ii) Strengthening of internal audits and controls (by ANACs and general inspection departments - see above the table about the roles distribution). Particular attention will be given by the Bank’s team to the quality of internal controls and audits to ensure that they are conducted according to international norms and standards. The review of TOR and the corresponding reports are one of the Bank’s means of control.
27. In addition, the following measures are to be taken:
i) Strengthening of the autonomy of ANACs; ii) In Senegal: establishment of a monitoring system for the collection and the management of safety charges; iii) Improvement of the flow of information about the project and its goals (by ANAC and through dissemination to the public); iv) Participation of civil society representatives and users of civil aviation and airports; VI Mitigation of collusion risks; vi) Mitigation of forgery and fraud risks; vii) Establishment of a complaint handling system; and viii) Creation of a sanctions and remedies system. a. Strengthening the autonomy of ANACs
28. The status of each ANAC in both countries will be clarified through the updating of existing texts, to ensure that they have real autonomy, both in administrative and financial terms, in accordance with ICAO’s recommendations. This approach is intended to: (i) provide each ANAC with a legal personality; (ii)secure resources through the use of user charges (mainly from aeronautical charges), and in particular avoid that ANACs depend on public budgets to carry out their mission; and (iii)monitor the evolution of ANAC’s budgets and their use, in particular to ensure that the users’ fees collected are used to strengthen the supervision of safety and security. b. In Senegal: establishment of a monitoring system for the collection and the management of safety charges
29. The control of the safety charges collection and management initially carried out by ASECNA, as manager of the Dakar L.S.S. airport, and transferred to the Ae‘roports du Se‘ne‘gal (ADS) in 2008, is listed among the commitments of the Government of Senegal within the framework of the program’s implementation. Since no accounting of these charges has previously been held, or at least disclosed, it is now necessary that a recording of these charges by an independent external auditor, recruited internationally, be
55 implemented in line with international accounting and financial rules using terms of reference acceptable to the Bank. c. Improvement of information diffusion regarding the program and its objectives
30. In order to improve information dissemination, the main actions required are the following:
Fiduciary aspects
Make procurement information (plans, schedules, bidding documents, shortlists of consultant, contracts awarded) available to the public promptly upon demand;
0 Disclose contracts awards ; 0 Carry out tenders openings publicly; Actively encourage representatives of the civil society groups to attend the public bid openings and other key procurement steps; and Give the possibility to all the parties involved in the procurement to register official complaints related to the project.
3 1. In both countries, the requests for proposals and bidding documents are issued after advertising in the national press. The Procurement Law (in Senegal) also provides for public bid openings and appeals mechanisms.
Dissemination of performance indicators
32. In both countries, the ANACs will discuss the progress of their program’s performance indicators with the community of civil aviation (airlines, service companies and administrations at airports), on a quarterly basis, to ensure proper monitoring of these indicators by users. The ANACs will also inform these same structures of the activities’ implementation progress. Performance indicators of the project (see Annex 3) have the advantage ofmeasuring the improvement ofoverall performance ofthe ANACs, not just the physical implementation of activities., d. Involvement of civil society and users of civil aviation and airports
33. To allow civil society oversight, the main actions ofthe project are to :
0 In relation to fiduciary issues: actively encourage representatives of the civil society groups to attend the public bid openings and other key procurement steps; 0 In relation to the achievement of the program’s development goals: share information with the media and civil society groups on a regular basis in order to involve these parties in the monitoring process (see also above). Local and national committees of airports security, which include stakeholders representatives and associations of air transport operators, will be particularly targeted; and Carry out audits on previous procurements and thorough investigations in cases of doubt on the competitive process.
56 e. Mitigation of collusion risks
34. This part essentially deals with fiduciary issues. To reduce collusion risks, the main actions ofthe project are to:
Appoint in each country fiduciary specialists who will support the management of procurement of goods and works for the project, and check the bids to detect any evidence ofcollusion; Make procurement information (plans, schedules, bidding documents, shortlists of consultants, contracts awarded, etc.) available to the public promptly upon request; Identify all the technical characteristics in the bidding documents to avoid pre-bid meetings; Advertise the bids with a standard agreed format and advertise them in a nationally circulated newspaper; Build capacity by providing guidelines and training on how to conduct clarifications/negotiations, as well as on monitoring contract implementation; and Benefit from the lessons learned during the first phases ofthe program in other countries regarding the most sensitive contracts, which allows the achievement of harmonized technical specifications (particularly for the procurement ofequipment). f. Mitigation of forgery and fraud risks
35. To mitigate forgery and fraud risks, the main actions of the project are the following :
Include a procurement specialist and financial management specialist within each implementing agency with fiduciary responsibilities, and build capacity in these fields in beneficiary structures which do not have fiduciary responsibility; Agree on a timeline for procurement decisions, to avoid procurement delays, and therefore reduce opportunities for corruption; Review regularly accounting reports including all supporting documents (Le. travel report, receipts); Conduct third party audits which will include review of procurement processes and results (end use checks, quality and quantity of acquired goods/works/services, verification of payments, price comparison between contract price and market price, etc.), preferably using available government structures; and Conduct training as needed to improve the capacity of key personnel at all levels. Training will include, as necessary, aspects of procurement, financial management, design, and supervision ofimplementation.
Internal audits are also expected to be conducted. g. Remedies
36. To implement remedy processes, the main actions ofthe program are:
57 Establish in each PCU a mechanism to be in charge of appeals, including keeping a record ofcomplaints and a method for tracking all complaints received; Respond to all claims within the time prescribed by contracts from the date of receipt (most difficult action to achieve). This procedure already exists in Senegal within the framework of the AMP, but it will have to be established in Benin in the project implementation manual; Ensuring the confidentiality of informants identities; and Follow the status of investigations and submit to IDA reports on the measures taken. h. Penalties and remedies
37. To implement a sanction and remedies process, the project will carry out actions similar to those undertaken within any World Bank Group funded activities. These are the following:
0 Establish a system of remedial actions and sanctions for cases of fraud, corruption, collusion and coercive practices. These may eventually result in the termination of the relevant contract, possibly with additional penalties imposed (such as fines, blacklisting, etc.); 0 Suspend or stop all disbursements to any contract /location if cases ofcorruption are not solved effectively; and 0 Ensure the implementation of decisions of appealhemedies organ’s determined in the Public Procurement Code.
38. The parties shall ensure that the above mentioned sanctions and corrective measures are well known and understood by those responsible for the implementation of the program, and by the public. Regarding the former ones, the Bank’s Team has already discussed these points with the FAs and the governments during the preparation phase of the Program. As for the public, in particular users and stakeholders in the civil aviation industry, their representatives were involved and informed of the program’s various aspects, as well as of its risks, in order to raise their awareness and encourage them to keep monitoring the program carefully.
39. In Senegal, these arrangements are already included in the public procurement code and the system ofgovernance: their implementation will simply have to be ensured.
58 Annex 7: Financial Management and Disbursement Arrangements
West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
I.Executive Summary
1. The objective of the Financial Management Assessments is to determine whether each ANAC in Benin and Senegal have acceptable financial management arrangements in place to take on the program’s fiduciary responsibility. These arrangements include each agency’s accounting system and reporting, auditing, and internal controls. Each implementing unit financial management arrangement is acceptable if it: (i)is capable of recording correctly all transactions and activities; (ii)supports the preparation of regular and reliable financial statements; (iii)safeguards its assets, and (iv) is subjected to a satisfactory auditing process. The financial management (FM) assessments of the Benin and Senegal ANACs were carried out in accordance with the Financial Management Practices Manual issued by the Financial Management Sector Board on November 3, 2005. The conclusions of the assessment are summarized in the table below:
Table 1: Conchs ins from FM Assessment Benin Senegal Financial management arrangements put Financial management arrangements have an in place by the ANAC meet the Bank’s overall moderate risk rating which satisfies the minimum financial management Bank’s minimum requirements under OPh3P 10.02 requirements under OPh3P10.02. Therefore, the risk rating for the ANAC is moderate.
59 11. Country Issues
Country Issues Mitigating measures The government’s policy framework for Since May 2006, the government has taken Budget Management (Gestion Budgetaire strong measures to address these issues. AxCe sur les Resultats) is based on the A decree regulating internal audit has been 2005 CFAA17and the recent 2008 PEFA’* adopted and the use of exceptional procedures (Public Expenditure and Financial has been strictly limited. Accountability) assessment. Risks remain The issue regarding delay in production of Benin in the following areas: accounts is being resolved with the future - Poor accounting recording and reporting recruitment of additional staff and the system. Public accounts are generally deployment of accounting software to the incomplete and delayed; sub-national level. - Control mechanism. Ex-post controls are Concerning external audits, discussions are in dncoordinated and include several units progress with the government to improve the working independently, external audits are working environment ofthe chamber of delayed; and account. - Surge in the use of expenses following exceptional procedures. A PEFA exercise has been undertaken in The government has given priority to the 2007 and the report concluded that improvement in these areas as well as local although some improvements in PFM governance finance reforms. A Multi-Donor reform implementation since the 2003 Trust Fund (MDTF) administrated by the CFAA, key risks and challenges remains Bank was set up to follow up the in area such as implementation of the reforms. (i)effectiveness of the internal audit The GoS is committed to conduct the PFM Senegal system by the Supreme Audit Institution reform through the Creation of a specific body (Cows des Comptes); - PFM Reform Steering Committee’s role is (ii)reliability of data for monitoring the to: (i)coordinate the reforms to be undertaken; stock of arrears; and (ii)harmonize Government actions; (iii) (iii)addressing the backlog of State monitor the implementation of the action plan; accounts. and (iv) hold different actors accountable for DroQress.
17 It is an updated version of the 200 1 CFAA 18 The recent has just been completed November 2007
60 111. Fiduciary Risks and Mitigation Measures Benin Residual Risk Risk Risk Rating Risk Mitigation Measure Rating Inherent Risks: Country: Poor governance/ The new government has taken strong Corruption/Weak internal control measures for fighting against environmentDelay in the corruption. Issues relative to internal preparation and audit of sate S control, reporting, auditing are being S accounts. addressed as mentioned above in the Country issues section. ImplementingEntity: ANAC has Training will be provided to no experience in the strengthen the ANAC staff capacity. implementation of a bank S M financed project. Project: ANAC FM staff is qualified but has never executed a World Bank S capacity. financed project. Control Risks: Budgeting M I I M Accounting M I I M Internal Control M M Funds Flow: ANAC is not ANAC FM staff will be trained by the familiar with the World Bank FM FM and disbursement specialists to be and disbursement procedures. familiar with the Bank FM, reporting Difficulties in the timely and disbursement procedures prior and S M submission of acceptable after the program effectiveness. Withdrawal Application (WA)/IFR may delay funds mobilization.. Internal Audit M I I M External Audit: ANAC 2005 and With the implementation of the audit 2006 audit reports not yet action plan agreed during February finalized. ANAC audit reports 2008 FM mission, the delay will be M likely to be submitted late. S erased by the end of the first quarter of 2009. Reporting and Monitoring: ANAC FM staff will be trained on the Delays in the submission of World Bank FM procedures and IFR. agreed IFR as the ANAC is not The comments provided during the familiar with the IDA FM S review of the IFR will help improve M requirements their quality. Information System M M Overall Risk: S M H: High S: Substantial M: Moderate L: Low
61 Residual Risk Rating Risk Mitigation Measure R& R& Risk Rating Inherent Risks: S M Country: PEFA exercise revealed The CFAA and PEFA action plan is unresolved weaknesses in PFM under implementation and the system. S government has created an Executive S Secretariat to follow up. ImplementingEntity: While basic The Financing Agreement (FA) and legal and institutional framework procedures manual will provide an is in place, implementation may S appropriate framework for the Program M be hampered by political implementation. interference. Project: Specific sector with no The simple design of the Program and experience of Bank’s projects. the Program Implementation Manual S (PIM) will help ANACS’s qualified M staff to implement effectively the Program under Bank tight supervision. Control Risks: S M Budgeting: Annual work plans will be prepared and submitted to the Bank by November 30 M L of each year.
Accounting: Local staff has no Recruitment of an experienced and IDA project experience. qualified Director of Administration and Finance (DAF) to support the M S accounting team. The existing computerized information system will be tailored to host the Program. Internal Control: The internal The Administrative and Financial procedures Manual will be set out with a S clear description of the Approval and M authorization processes. An internal Auditor will be recruited. Funds Flow: No experience in A Designated Account will be opened disbursement procedures may by DDI (Direction de la Dette et de delay replenishment of funds. for the purpose of the I ’Investissement) M S Program. Training of staff on Bank’s FM, procurement and disbursement procedures, will be provided.
62 External Audit: Recruitment of a An external Auditor with experience and Legal Auditor (Commissaire aux S qualifications satisfactory to the Bank M Comptes) may not be transparent will be recruited Reporting and Monitoring: The Bank will assist ANACS in defining Delays in the submission of the format and producing the quarterly agreed IFR since ANAC is not S reports (IFR) M familiar with the IDA FM requirements Information System: The ANACS The ANACS FMS will be trained to be Information system may not be familiar with the IDA FM reporting used efficiently or may not be requirements. Agreement on the IFR able to provide acceptable IFR S format and content will be reached prior M and other relevant reports the program negotiation and will allow the ANACS to update its information system if needed Overall ~isk: S M H - High S - Substantial
Country Strengths Weaknesses
Qualified FM staff. 0 No experience in the implementation of Computerized accounting and the Bank financed project. Benin financial management information Delay for the audit of the ANAC system. accounts.
0 Accounting and financial manual.
0 Sound budgetary monitoring process 0 Lack of qualified and experienced FM in place conducted by a qualified staff. financial controller. No experience implementation of Bank Senegal 0 Administrative and Financial procedures.
Manual that need an improvement. 0 Inadequate positioning of FM function in the organization.
IV. Institutional and Implementation Arrangements
Country Implementing agency Status ANAC will be the agency responsible for the overall program Benin oversight and implementation. It will handle both technical Existing body and fiduciary responsibilities. ANAC will be the agency responsible for the overall program Senegal oversight and implementation. It will handle both technical Existing body and fiduciary responsibilities.
63 V. Budgeting Arrangements
Country Status The ANAC budget including the program activities is undertaken centrally by the financial department in consultation and with extensive detailed input by the respective Benin implementing departments and adopted by the steering committee before the beginning of the year. Program activities will be integrated in the ANAC budget and submitted to the IDA’Sobjection. Budget is adopted by the SC before the beginning of the year after internal consultation with implementing department. The financial controller is in charge of budget monitoring.
VI. Internal Controls and Audit
2. Internal control comprises the whole systems of control, financial or otherwise, established by the ANAC in order to (i)carry out the budget activities in an orderly and efficient manner; (ii)ensure adherence to policies and procedures; (iii)safeguard the assets; and (iv) secure as far as possible the completeness and accuracy of the financial and other records.
Country Status There is no internal audit department within ANAC. However with the segregation of duties and responsibilities, the ANAC internal control environment is found to be adequate. Under Benin this project, the General Inspection department within the Ministry in charge of Transport carries out Internal Audit function with specific TOR. The steering committee approved the principle of recruitment of an Internal Auditor. The Senegal Bank will pay attention to the qualification, experience and TOR of the Internal Auditor.
VII. External Audit
3. ANACs financial statements will be audited by external independent auditors. The audit scope will be extended and cover the activities financed under the program. Single opinion on the Annual Financial Statements in compliance with International Standards on Auditing (ISAs), will be required for each implementing agency. The auditors will be required to prepare a Management Letter giving observations and comments, and providing recommendations to improve the internal control. The ANACs audit reports which include the program activities will be submitted to IDA within six months of the end of the fiscal year.
VIII. Reporting and Monitoring
4. Quarterly IFRs derived from the implementing entities financial management information system will be prepared and include sources and uses of funds by component. It will also include a comparison of budgeted and actual program expenditures (commitment and disbursement) to date and for the quarter.
5. The implementing entities will produce annual financial statements, and these statements will comply with International Accounting Standards (IAS) and World Bank requirements.
64 6. These financial statements 19willbe comprised of:
0 A balance sheet reflecting the assets, liabilities and funding of the program based on the cash; A statement of sources and uses of funds; A statement of commitments; The accounting policies adopted and explanatory notes; and 0 A management assertion that program funds have been expended for the intended purposes as specified in the relevant financing agreements.
7. ANACs of Senegal and Benin will be responsible for preparing and submitting the IFR and send copy to the Bank within 45 days of the end of each quarter.
IX. Information Systems
8. A program-specific financial management system will be customized in the existing accounting software. The program chart of accounts will accommodate the proposed program to capture sources and uses of funds, assets and liabilities in sufficient detail. The system should integrate the budgeting, operating, and accounting applications to facilitate monitoring and reporting.
X. Accounting Policies and Procedures
9. Program accounts will follow policies already in place with ANACs operations. Accounts will be maintained on a cash basis, augmented with appropriate records and procedures to track commitments and to safeguard assets. Annual financial statements will be prepared in accordance with IAS.
10. The chart of accounts will facilitate the preparation of quarterly and annual financial statements, including information on the following:
Total program expenditures; and Total program commitment.
11. Accounting and control procedures are documented in the Administrative, Accounting and Financial Manual.
l9 It should be noted that the program financial statements should be all inclusive and cover all sources and uses of funds and not only those provided through IDA funding. It thus reflects all program activities, financing, and expenditures, including funds from other development partners.
65 XI. Staffing
Country Staff in charge of the program FM Action matters ANAC director of administration and Bank FMS will provide training. The finance, chief financial and accounting ANAC financial management and services and accounting manager. All of accounting staffs will contact other IDA Benin them are qualified but have never managed financed projects for training to be able to IDA financed project and are not familiar be familiar with the Bank's FM and with the World bank FM procedures. disbursement procedures and be able to prepared IFR. ANACS financial controller in charge of There is a need of recruiting a qualified budget monitoring and a financial director of administration and finance Senegal accountant. (DAF) familiar with the Bank procedures to support the FM team. The Bank FMS will also urovide guidance and suuuort.
XII. Flow of Funds
12. Disbursements under the IDA credit may be made according to the agreed categories of expenditures. At effectiveness, the credit may be disbursed following the transaction based disbursement. The conversion to report-based disbursements may be envisaged when the implementing entities have capacity to produce acceptable IFRs.
Country Type of Accounts and Currency Status 0 Transaction Account (TA) at the 0 Funds will flow from the credit account Central bank (BCEAO) through the Transaction Account 0 Designated Account (DA) in CFAF at (opened at the BCEAO and managed ECOBANK. by the Independent Amortization Fund: Caisse Autonome d Ymortissement: Benin 0 Advance: CFAF 375,000,000 CAA). The associated Designated Account will be opened at ECOBANK. 0 Withdrawal Applications (WA) to be sent to IDA will be prepared by ANAC and signed by the CAA.
0 Designated account at Commercial 0 Funds will flow from the IDA credit Bank. account to the designated account to be
Senegal 0 Allocation of CFAF 300,000,000 opened by DDI (Direction de la Dette et de 1 'Investissement) and managed by ANACS.
66 Figure 1: Flow of Funds
Flow of frtndt Betlit1
/I I
(opened at ECOBANK) managedby ANAC
Fund.. -, Reyoits, goods. etr
Flow of funds. Senegal
Funds - Reports. goods. etc.
Note: CA Caisse.- Autonome dilmortissement DP Direct Payment DDI Direction de la Dette et de 1 'Investissement WA Withdrawal Application IFR Interim un-audited Financial Report BCEAO Banque Centrale des Etats de 1'Afiique de 1'Ouest
67 XIII. Retroactive financing
13. The grant in Benin and the credit in Senegal will provide for retroactive financing of up to five percent of each proposed amount, to finance expenditures, which were incurred before grant and credit approval and after September 1,2008.
XIV. Disbursement Arrangements
The following table describes disbursement schedules per country:
Estimated disbursements Benin (Bank FY/US$m) I I I I I FY 2009 I 2010 I. 2011 I 2012 I 2013 Annual I 0.50 I 2.79 I 2.70 I 1.80 I 1.21 Cumulative I 0.50 I 3.29 I 5.99 I 7.79 I 9.0
FY 2009 2010 2011 2012 2013 Annual 0.50 2.21 2.30 1.20 0.79 Cumulative 0.50 2.71 5.01 6.21 7.00
Expected effectiveness date: June 30, 2009 Expected closing date: December 3 1, 2012
The disbursement amounts per country and per category are stated as follows:
Benin Amount of credit allocated 1 Category I (Expressed in US$xlOOO)
1. Civil Works. Goods and Consultant Services I 8.42 I
Senegal I I Amount of credit Allocated Category I -- -~! (Expressed in ' 1. Civil Works, Goods and Consultant Services 6.62 I 2. Operating Costs 0.10 ,I 3. Unallocated 0.28 Total 7.00
68 XV. Use of Statement of Expenditure
14. The thresholds for which expenses will be paid or reimbursed on the basis of statements of expenditure (SOE) will be specified in disbursements letters issued in each country. As an indication, these thresholds are:
Country SOE Less than: US$500,000 for works Benin US$500,000 for goods US$200,000 for consulting firms US$50,000 for individual consultants Less than: US$500,000 for works Senegal US$500,000 for goods US$200,000 for consulting firms US$50,000 for individual consultants
XVI. Supervision Plan
15. Supervision activities will include review of IFRs; review of annual audited financial statements and management letter as well as timely follow-up of issues arising; participation in program supervision missions as appropriate; and updating the FM rating in the Implementation Status Reports (ISR).
16. The intensity ofon-site FM visits will be based on the assessed FM risk for ANACs. However, given the fact the ANACs of Benin and Senegal have never implemented in the past a Bank’s financed project, FM supervision will be intense the first year ofthe program and will focus on theses agencies FM capacity building.
Activity Frequency Deliverable IFR Quarterly Review letter filed in IRIS Audit report review Annually Review letter filed in IRIS Transactions reviews, participation in the SPN Bi-annual Aide memoire, FM rating mission for ISR Training / capacity building Annually Re port
XVII. Financial Management Action Plan
17. The action plan below indicates the actions to be taken for the program to strengthen its financial management system.
69 completion date body Updating of the Administrative, Financial Accounting ANA C By effectiveness ANAC Manual Recruitment of an Accountant By effectiveness ANAC Amointment of external auditor Bv effectiveness ANAC
Action to be taken Expected Responsible completion date Body Recruitment of a qualified Director of Finance to support By effectiveness ANACS existing FM team Update the Financial and Administrative Manual By effectiveness ANACS Recruitment of an Independent External Auditor for the Audit of 2008 and 2009 Financial Statements and the By effectiveness CAPJANACS collection and management of the security fee
70 Annex 8: Procurement Arrangements
West and Central Africa Air Transport Safety & Security Program Phase 2-B
I.General
Country Procurement context
1. Benin: A Country Procurement Assessment Report (CPAR), assessing the national procurement system, was carried out in April 1999 for Benin and an action plan for a procurement system reform was developed in November 2002, during a national workshop. This action plan supports the modernization of the regulatory and institutional framework, and its objectives are to: (i)improve the management of public contracts; (ii)modernize public procurement procedures; (iii)strengthen capacities; (iv) establish an independent control system; and (v) adopt anti-corruption measures. In addition, the plan provides for the gradual empowerment of the decentralized procurement entities; the definition of a strategic framework for capacity building in procurement; and the updating of tools such as standard bidding documents and manual for procurement procedures to ensure effective use of the procurement code.
2. Implementation of the new institutional framework has translated into the creation of a: (i) National Commission of Public Procurement Regulation (CNRMP); entity independent of procurement transactions and comprising the public and private sectors and civil society, and responsible for policy, audit of public procurement and dealing with complaints from bidders; (ii)National Directorate for Public Procurement (DNMP) responsible for controlling the quality of procurement transactions; and (iii)Public Procurement Units (CPMP) at Ministries level. The government is harmonizing the legal and institutional procurement framework with the UEMOA Procurement Directives adopted by its Council of Ministers in December 2005. To that end, a new procurement law has been sent to Parliament for adoption.
3. Senegal: The procurement process follows the Senegalese procurement code which is regulated by the Decree n"2007-545 signed of April 25, 2007. This code was drafted during the period 2005-2006 with IDA assistance, and it mainly comes as an amendment of the 2002 procurement code which had major deviation with Bank's rules. In general, the current country's procurement procedures do not conflict with the Bank's Guidelines. No special permits or licenses need to be specified in the credit documents, since Senegal procurement practices allow IDA procedures to take precedence over any contrary local regulation or practice. In addition, the code has established an independent regulatory agency which is also in charge of auditing procurement activities.
4. The new Public Procurement code is already approved and under application and has introduced the following improvements: (i)a Public Procurement Directorate was created in 2007 (decree No 2007-547 dated April 25, 2007) for controlling procurement transactions of all public contracting authority and (ii)a Public Procurement Regulatory Authority (Autorite' de Rkgulation des Marche's Publics - AMP) was set up in 2007 (decree no 2007-546 dated April 25, 2007) for supervising the whole procurement system
71 including policy formulation, handling complaints, supervising procurement audits and implementing the capacity building program on procurement. These two entities are now operational. Standard bidding documents are still under preparation (Le., main national bidding documents are in the process of validation).
Applicable procurement policies and procedures
5. All countries: Procurement for the proposed project would be carried out in accordance with the World Bank’s “Guidelines: Procurement under IBRD Loans and IDA Credits” dated May 2004 revised October 2006; and “Guidelines: Selection and Employment of Consultants by World Bank Borrowers” dated May 2004 revised October 2006, and the provisions stipulated in the Financing Agreements. The various items under different expenditure categories are described in general below. For each contract to be financed by the credits, the different procurement methods or consultant selection methods, the need for pre-qualification, estimated costs, prior review requirements, and time frame are agreed between the Borrowers and the Bank in the respective Procurement Plans. The Procurement Plans will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity.
6. National Competitive Bidding (NCB) procedures may be used provided that: (i)bids are advertised in national newspapers with wide circulation; (ii)bid evaluation, bidder qualification and award criteria are specified clearly in the bidding documents; (iii)bidders are given adequate response time (minimum four weeks) to prepare and submit bids; (iv) bids are awarded to the lowest evaluated bidder proven this bidder is qualified; (v) eligible bidders, including foreign bidders, are not precluded from participating; and (vi) no preference margin is granted to domestic suppliers.
Procurement Documents
7. All countries: The procurement will be carried out using the Bank’s Standard Bidding Documents or Standard Request for Proposal (RFP) respectively for all ICB for goods and recruitment of consultants. For NCB, the borrower shall submit a sample form of bidding documents to the Bank prior review and will use this type of document throughout the project once agreed upon. The Sample Form of Evaluation Reports developed by the Bank, will be used.
Advertising procedures
8. All countries: General Procurement Notice (GPN), Specific Procurement Notices (SPN), Requests for Expression of Interest and results of the evaluation and contracts award should be published in accordance with advertising provisions in the following guidelines: “Guidelines: Procurement under IBRD Loans and IDA Credits ” dated May 2004 revised October 2006; and “Guidelines: Selection and Employment of Consultants by World Bank Borrowers” dated May 2004, revised October 2006. The borrower will keep a list of received answers from potential bidders interested in the contracts.
72 11. Procurement methods
9. All countries: For each contract to be financed by the credits, the different procurement methods or consultant selection methods, the need for pre-qualification, estimated costs, prior review requirements, and time frame are agreed between the Borrowers and the Bank in the respective Procurement Plans. The different types of procurement activities and total costs of contracts in the respective countries are as follows:
Training, Workshops, Study Tours, and Conferences: The training (including training material and support), workshops, conference attendance and study tours, will be carried out on the basis of approved annual training and similar activities plan. A detailed training or workshop plan giving nature of training/workshop, number of trainees/participants, duration, staff months, timing and estimated cost will be submitted to IDA for review and approval prior to initiating the process. The appropriate methods of selection will be derived from the detailed schedule. After the training, the beneficiaries will be requested to submit a brief report indicating what skill have been acquired and how these skills will contribute to enhance his performance and contribute to the attainment ofthe project objective. 0 Operational Costs: Operating costs financed by the project are incremental expenses, including office supplies, vehicles operation and maintenance, maintenance of equipment, communication costs, rental expenses, utilities expenses, consumables, transport and accommodation, per diem, supervision costs and salaries of locally contracted staff. They will be procured using the procurement procedures specified in the project’s Administrative, Financial and Accounting Manual acceptable to the Bank.
10. Benin: 0 Procurement of Goods: The total cost of contracts of Goods to be financed by IDA, is estimated at US$6 million equivalent. The items would include: office equipments, furniture, information system equipments, detection equipments, vehicles, and office supplies. For shopping, the project procurement officer will keep a register of suppliers updated at least every six months. 0 Selection of Consultants: The project will finance Consultant Services such as studies, surveys, financial audits, trainers and workshops facilitators; the total cost of consultant services to be financed by IDA is estimated at US$0.93 million.
11. Senegal: 0 Procurement of Goods: Goods procured under this project would include but are not limited to the acquisition of computer hardware, office supplies, equipment for ANACS’s medical center designed, to perform basic medical checks on air crews for flight licences award and renewal purposes (e.g., electro cardiogram, pulmonary x-rays), airport security equipment and vehicles. The total cost of goods to be financed by IDA is estimated at US$2.2 million. 0 Selection of Consultants: Activities needing selection of consultants include, but are not limited to, the update of the civil aviation Technical Regulations, the review of the institutional framework for civil aviation and the use ofthe aviation fees, the translation in English of the Civil Aviation Code and its regulations. The total cost of consultant services to be financed by IDA is estimated at US$1.88 million.
73 111. Procurement Implementation Arrangements and Assessment of Capacity to implement procurement
12. All countries: Each Borrower, through its implementation agency, will be responsible for the implementation of procurement process relatives to the project activities identified for the concerned country. The procurement implementation arrangements and assessment of capacity to implement procurement in the respective countries is described below.
13. Benin: The procurement will be carried by ANAC. Procurement activities will be carried out by the Procurement officer who will be nominated by the agency. It has been agreed that the Procurement officer shall be an Engineer. The Procurement officer will supervise and coordinate the project procurement activities that will be implemented by ANAC. He/She will work closely with the Procurement Unit (“Cellule de Passation des Marche‘s Publics ”) of the Ministry in charge of Civil Aviation. The Procurement Unit will be used only for prior review ofprocurement documents and processes until ANAC’s own Procurement Unit has been created, as agreed with Government. This Procurement Unit is expected to be operational before the project’s mid-term review. The Procurement Unit of the Ministry ofTransport shall designate a focal point for project.
14. The project procurement officer will be responsible for the coordination of all procurement activities, including the following: (i)preparation and updating of the procurement plans (ii)preparation, finalization and launching of the Requests for Proposal and bidding documents; (iii)drafting of minutes of opening of the bids/proposal and preparation of the evaluation reports; (iv) submitting of procurement documents (TORS, RFP, bidding documents, evaluation reports, contracts, etc.) to the Bank when prior review is required; (v) preparing the contracts, and overseeing the payments to contractors; and (vi) drafting of procurement progress report. All project procurement prior review documents should be submitted to IDA through the Project Coordination Unit. The procurement officer will oversee and manage the project’s procurement activities and ensure that these activities are proceeding in a timely manner and according to project’s objectives.
15. For particular or specialized procurement, the project may require the services of a procurement consultant for bidding documents preparation and support in bids or proposal evaluations. In this case, the consultant should work closely with the procurement officer to strength his capacity.
16. An assessment of the capacity of ANAC to execute procurement was conducted by the Procurement Specialist based in the Benin Country Office. The assessment reviewed the organizational structure for implementing the project and the interaction between the project’s staff that will be responsible for procurement (procurement officer) and the project’s relevant Ministry (Ministry of Transport). The assessment showed that neither ANAC nor the Ministry in charge of Civil Aviation procurement unit were familiar with Bank’s procurement procedures. However, it was established that staff qualifications in each entity was sufficient to enable them to manage the project’s procurement activities, assuming they receive proper training.
74 17. Most of the issues/ risks concerning project procurement activities management were identified during this assessment. They include: (i)lack, at ANAC level, of procurement staff that is knowledgeable and experienced in Bank procurement procedures; (ii)delays in procurement review by National Directorate for Public Procurement (DNMP); (iii)lack of standard bidding documents; and (iv) confusion within ANAC’s departments regarding procurement responsibilities (Le., between DISS and the Directorate in charge of Financial management). Accordingly, the overall project risk for procurement was rated as Medium.
18. The measures agreed upon to strengthen the procurement management capacity are: (i)specific training on World Bank’s procurement procedures (goods and consultants services) for the nominated procurement officer, (ii)the use of procurement consultant for specialized Procurement, (iii)the review of the procurement section of ANAC’s Administrative, Financial and Accounting Manual, and (iv) the use of Bank standards’ documents for ICB and RFP.
Table 1: Summary of the project preparation action plan
I Task I Completion I Responsibility Submit to the Bank the revised procurement plan Completed Project coordination ofthe first 18 months. of ANAC Actualize the procurement section ofthe Before ANAC ODerations and Procedures Manual. effectiveness I Nominate the project procurement officer. I Completed I ANAC I Procurement training for the project procurement Six month officer and for the focal point ofproject Project coordination following procurement documents review at the of ANAC effectiveness nrocurement unit ofthe Ministrv of Transnort.
19. Senegal: Procurement activities will be carried out by ANACS through a coordination unit. Accordingly, for now, there is neither a procurement unit nor a procurement specialist within ANACS. ANACS procurement activities are currently conducted by the. staff responsible for logistics. ANACS reports directly to the Ministry in charge of air transport and has not yet clarified its autonomy in the management of its procurement activities. ANACS has been created by the law referenced 2002-31 signed on December 24, 2002. Based on the past experience in the PST2, ANACS has a capacity for procurement reporting but there is no certainty, however, that the same staff will be available during the project implementation.
20. An assessment of the capacity of the project coordination unit to carry-out procurement for the project was carried out on April 8th, 2008 by the Bank procurement specialist based in the Dakar Country Office. The assessment reviewed the organizational structure of ANACS, interaction between staff members responsible for procurement and their level of autonomy with regard to the Ministry’s office in terms of procurement processes. The assessment also put an emphasis on the interaction with the structures benefiting from support and in charge of technical implementation of activities within the
75 project. The Project Coordination Unit staff is currently only composed of a main coordinator, an expert on security issues, and a financial management specialist responsible for the management of administrative and financial affairs. Accordingly, the overall project risk for procurement was rated as high.
21. The major procurement risks are: (i)possible delays and ii)possible interference in procurement decisions including contract award and execution. It is recommended that the responsibility ofeach entity should be clearly defined in the related documents.
22. Mitigation of the risks linked to procurement: Since there is no staff in place in the coordination unit to handle procurement activities, a qualified procurement specialist will be hired in a consultant position and hisher role will consist in supporting the project coordination unit within ANACS. He or she will be positioned in the coordination unit and will also play an advisory role whenever necessary. He/She will be responsible for the preparation and evaluation ofthe bidding documents as well as the follow up of the contract award process. For each project’s component, a procurement assistant will also be hired while existing staff involved in procurement activities will benefit from a capacity building program. This training will be specifically focused on Bank’s procedures and national procurement rules. Recruitment of a qualified procurement specialist will be a condition of effectiveness.
IV. Procurement Plan
23. All countries: Each borrower has developed a draft Procurement Plan (PP) which provides the procurement methods for each contract. The plan covers the first eighteen months of program implementation. This plan will be available at the Implementing Agency. It will also be available in the project’s database and in the Bank’s external website. The Procurement Plan will be updated in agreement with the Bank at least annually in conjunction with an updated project annual work program or to reflect an action plan following improvements in institutional capacity. All procurement activities will be carried out in accordance with the original or formally updated agreed PP. The consolidated procurement plan is displayed below.
24. Goods and non-consultingservices:
Prior Review Threshold: Procurement Decisions subject to Prior Review by the Bank as stated in Appendix 1 to the Guidelines for Procurement will be determined by the respective procurement plans.
76 Procurement Method Prior Review Threshold (US%)'*' Comments method Threshold (US$) Benin Senegal
I I I Methods can be applied for any amount, but they are 1. ICB andLIB 500,000 500,000 500,000 I I mandatory if the estimated I cost is> US$SOO,OOO.
The first two The first two 2. NCB <500,000 __ contracts contracts The fist two The first two <25,000 __ contracts contracts -- All contracts --
(*) The prior review is required for the first two contracts of each procurement method whatever the amount is.
Procurement Packages with Methods and Time Schedule:
1 NO 1 yes i 05/29/09 I __ Security equipment (X I
2 1 1,532,500 ~ ICB ~ No No ~ yes ~ 12/29/08 ~ 3 lots Ray, scanner, etc.). j Video surveillance
3 systems for the airport ~ 750,000 ICB ~ No No yes 06/13/10 ~ field. i SAR Equipments SAR: 4 beacon, radio, GPS, talkie ~ 317,500 ~ 112 ~ 6/26/10 ~ -- walkie, VHF equipment. :;
5 Vehicles and motorcycles. 220,000 &: ~ 1:: ~ 19/12/08 Restricted area access 200,000 ICB No 6 control system. 1 Emergency center equipments + furniture for 7 200,000 ~ ICB No the training center and the PCU. Telecommunication I I network for I I 1 8 1 150,000 NCB ~ No ANAC/ASECNA/Airport No yes 1 07/09/09 j I interconnexion. i Electronic and IT office I 9 equipment (tel., fax, telex), 55,000 I NCB No yes 04/30/09 didactic equipments. ICAO Security training 10 equipment kit. ~ 50,000 ~ DC ~ No No yes 12/20/08
77 i Estimated Domestic E~~~~~ ' Procurement qualifi-cation I1 preference Prior Bids Description 1 Comments i Method Review opening/clos
(yeslno) ~ (yes/no) ing Date ._ - 11 / ICAO technical library. / 25,000 1 DC 1 No 1 No- 1 yes 1 12/20/08 I IT equipment fir I I 15,000 1 Shopping 1 No No yes 1 11/29/08 ~ Senc Video surveillance v-
1 systems for the airport 750,000 ~ ICB No ~ Yes 02/26/09 field. i I Aeronautical medical I equipment for :(i) I radiography,(ii) biology 2 6oo'ooo ~ ICB No Yes 0 1/30/09 analysis,(iii) electrocardiogram,( iv) ophthalmology, etc..--____.. . Vehicles for : (i)airport patrolling, with VHF(x4); (ii)SAR with 3 VHF,UHF,HF, 387,500 NCB No No 12/15/08 Radiogonometry and rotating lights; (iii)
1 Inspection...... - - Equipment for the Accident and Incident 200,000 NCB No No 0911 0109 Investigation Office. I communication I equipment: VHF(x15)/ No No 12/15/08 Talkie Walkiel radio relay. 859000 I NCB Inspection and didactic equipments and ICAO 6 50,000 1 DC No Yes 12110108 Security training I - equipments kit. i Crisis management I 50,000 j Shopping N.A. 7 training. Electronic and IT equipments: (lotl) IT equipments (computers, i 8 printers, scanners); (lot2) 50,000 I Shopping No I No 10/30/08 Furniture and office supplies; (lot3) other IT
-sydies. l.-_l_ll- - . .._-. Equipments for SAR 9 20,000 Shopping No NO N.A. trainings. 1 I__ - Equipments for the SAR coirdination center (office I 1 supplies and furniture, IT I I 10 17,500 ~ Shopping No No 1211 1/08 and electronic equipments, I communication equipments).
78 25. Consultants :
Prior Review Threshold: Selection decisions requiring prior review by the Bank as described in the Bank (( Guidelines: Selection and Employment of Consultants by the World Bank Borrowers D, Exhibit 1, will be determined in the procurement plans of each country.
~ Threshold for Bank prior Selection Threshold for each review(US$)(*) Comments Methods method(US$) Benin Senegal This method can be 1. QCB S -- 200,000 200,000 used for any contract amount. 2. SBCQ Less than N/A N/A -- 100,000 Applicable especially 3. LCS __ 200,000 200,000 foraudits and insurance contracts. The first The procurement plans 4* Individual two The first two can determine other Consultants __ contracts contracts Drior review. 5. Direct -- All contracts. _- Contracting
(*)Prior review is mandatory for the first two contracts using each selection method, whatever their amount is. Prior review is also required for: (i) all Consultant Terms of Reference, and (ii) detailed budget of capacity strengthening activities, with estimated cost superior or equal to the equivalent of US$S, 000.
79 Consultant's contracts with their selection methods and planning:
I I Expected
Ref' Estimated Cost 1 Selection Prior Review by ~ Proposals Description of Assignment Comments No. 1 (US%) I Method the Bank Submission L' I Date Benin . __ . .- - --I --
1 up safety and 200,000 , QCBS ~ Yes 1 06/30/10 security audits I Recruitment of a Procurement I i 2 100,000 Yes 11/15/08 Specialist i Recruitment ofan Accountant/ 1 3 100,000 IC Yes i 12/01/08 Finance Assistant 1 I I
Independent financial Audit ~ I financier of the project accounts 1 i 4 loo,ooo 1 LCS j Yes i 12/13/08 the ANAC's financial statements 1 I I I - Newregulation(2009-201 Code 1)edition and technical and 1I 100,000 I IC I~~ Yes 06/30/10 5 dissemination activities ___ + - +--- - Technical Assistance for I I I I upgrading the regulation and 6 55,000 I IC ~ Yes ' 11/16/08 guidelines to conform ICAO ~ ~ I - security standards I I I Technical Assistance for 1 upgrading the regulation and 7 j 55,000 ~ IC ~ Yes ~ 11/16/08 1 guidelines to conform ICAO i i safety standards __ 1 _--I__ Translation of the Code and 8
- regulations into English I No ~ 04/06/10 _____- 9 Preparation ofthe SARexercises 1 45,000 i QCBS 1 Yes ,~ 11/31/09 Elaboration ofthe initial and 1
10 30,000 ~ IC ~ No 07/02/09 periodic Safety training program ' 1 Study on the allocation of 11 1 30,000 IC I No 1 1113 1/08
Security motivation premiums j I I ~ Preparation of Crisis I 12 25,000 1 IC No i 11/31/09 management exercises (Security)-~- 1 Elaboration of the initial and I I I I ~ 13 periodic Security training i 20,000 IC i NO 07/02/09 program . I LI ,
~
Elaboration of technical ~ I 14 specifications of the SAR 20,000 I IC No 11/3 1/08 cartoeranhies I I Senegal Update of Safety Technical I 1 1 1 750,000 ' QCBS 1 Yes I 02/16/09 1 regulations _I I 1
Follow up of ICAO safety and ~ 2oo,ooo 'I QCBS Yes 06/301io 1 security audits , I I Dissemination activities for the ' i 150,000 QCBS I No 01/10/11 new civil aviation Code , Review of the institutional 4 framework and fees allocation 125,000 QCBS i No 01/20/09 1 1I ' among civil aviation entities !
Drafting ofICAOAnnexes 9 & loo,ooo ~ QcBs No 5 1 1 02/16/09 17
80 I II I ExDected 1 I Description ofAssignment 1 Estimated Cost ' Selection 1 Prior Review by Proposals Comments ~ 1 (US%) , Method I theBank I Submission I ~' I 1 I Setting-up of IT sofiware slots 100,000 QCBS No 02/06/09
i ~ I management 1 w I Independent Financial Auditor QCBS 1 No Financial Assistant 12110/08 Study for the creation of an I I I
Accident & Incidents 1 50,000 ~ QCBS N~ ~ 03/10/09 i --+- I ____ I 50,000 1 IC 08/19/09 !
remilatinns 50,000 ,I QCBS 1 NO 0911 1/09 nt of a Procurement
26. All countries - Short list comprising of entirely national consultants: Short list of consultants for services, estimated to cost less than US$200,000 equivalent per contract, may comprise entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. However, if foreign firms have expressed interest, they should not be excluded from consideration.
V. Procurement supervisions missions and audits
27. All countries: In addition to the prior review to be carried out from World Bank offices, there will be one supervision mission every six months and at least one Bank annual Post Procurement Review (PPR); the ratio of post review is at least one to five contracts. Every six months the implementing agencies shall prepare and submit to the Bank review a project procurement management report with details on implementation.
81 Annex 9: Economic and Financial Analysis
West and Central Africa Air Transport Safety & Security Program Phase 2-B
1. Today West and Central Africa’s (WCA) air transport sector faces many safety and security issues and individually, most of the WCA States do not have the financial and human resources to comply with either US, European or ICAO’s safety and security requirements. In West and Central African countries, the regional Air Transport Program initiated by the Bank is aiming to enhance the compliance with security and safety international standards in support of the economic and social development in the region. specific economic sectors would benefit from the improvement of air services such as tourism and trade (Le. manufacturing, agriculture).
2. Measuring the economic benefits of the implementation of the program would require forecast data about the quantitative impact of putting in place measures that would strengthen safety and security of air transport in the targeted countries. No such information is available, however, and no cost-related data can be obtained to make relevant computations. Furthermore, the nature of the investments financed (Le.; airport security infrastructure and equipment, safety and security training) make any quantification ofthese benefits difficult as these investments are among many others necessary to strengthen the aviation sector’s growth potential. Nevertheless, it is still possible to highlight today’s impact on the aviation sector globally in SSA countries based on available studies and surveys. More specifically the major impacts of the program would be on tourism, travel fares, trade and investment into Africa.
I.Tourism in Africa - the Role of Aviation
3. In 2005, according to a World Tourism Organization (WTO) report, Africa accounted for 4 percent of international tourist flows, or 37 million tourists. Among African countries, six, namely Morocco, Tunisia, South Africa, Mauritius and the Seychelles accounted for 58 percent of that total (see Table l),while Senegal, Benin accounted for only, respectively, 2.1 percent, and 0.5 percent ofthat same total.
4. Although African’s share of international tourism is limited, with about 3.4 million jobs (direct employment), it boats the third largest number of direct and indirect tourism employments linked to air activities worldwide (see Figure 1). Such number provides strong evidence of the unusually large dependency of Africa’s tourism activities on aviation services. Thus, Africa, and for that matter WCA countries depend, more than any other world’s regions or countries on aviation activities for their tourism activities.
82 Table 1: Tourism in Africa (2005)
International Tourist Market Share in 2005 Arrivals (000) the Region South Africa, Morocco, Seychelles, Mauritius, Tunisia 21,828 58.5% Nigeria 962 2.6% Senegal 769 2.1% Burkina-Faso 222 0.6% Cameroun 190 0.5% Benin 174 0.5% Mali 143 0.4% Guinea 45 0.1% Rest of Africa 12,979 34.8% Africa 37,3 12 100.0%
Figure 1: Tourism-related employment (indirect + direct) supported by air (2004)
- _I-I___.____?
7
6
5
v) S -.-g4 E 3
2
1
0 Asia-Pacific Europe Africa Latin America/ North America Middle East Caribbean
Source: OEF- WTTC, 2004
5. The proportion of direct employment generated by tourism in Senegal and Benin is in the range of Africa’s most visited countries (see Figure 2); this underscores Senegal’s past ability to generate a significant amount ofjobs from tourists and reflects the country’s potential to carry on. At a regional level, Senegal is the leading country in Western Africa, with the 68,000 jobs its tourism supports annually, while Benin’s tourism generates 40,000 direct jobs. About 6 percent of Benin’s total capital investment depends on tourism activities, which is in the range of the others western Africa countries (see Figure 4). Senegal achieves better, with more than 11 percent of its total capital investments depending on tourism activities, almost as much as Morocco.
83 6. These numbers underscore the importance of tourism for these countries’ economy and, consequently, that of air transport which is in all WCA the primary mode of transport utilized for international tourists to reach them. It is not by mistake that the dominant countries in the African tourism industry (Le., the Group of Five) all boast world class air carriers which are supported by world class civil aviation authorities and airport security and safety. Indeed, among this group of five, all but the Seychelles which does not have national airlines are certified IASA Category Iby the US FAA and airports certified by the US TSA for direct flights to the USA.
Figure 2: Tourism industry direct employment in 2006
800.0 16.0% 14.9% 14.1% -- 14.0%
600.0 12.0%
10.0%
400.0 8.0%
I 6.0%
200.0 I 4.0%
923% 394 \ +2.0%
0.0 %O%
U \ d Source: WTTC, 2008
84 Figure 3: Annual travel and tourism revenues (2006)
12,000
T 10,146 10,000
8,000
-I-5 'E 6,000 3 4,Sl 1 4,000 3,238
2,000 I 876 7an. -- I 313 312 247 m 0 - Morocco Tunisia Kenya Cameroon Senegal Benin Burkina Guinea Faso
Source: WTTC, 2008
Figure 4: Tourism capital investment as a percentage of total investment in 2006
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
Mauritius 4.6% Dominican Republic -120.6% Gambia
Tunisia
Cuba
South Africa
Morocco
Kenya
Senegal
Mali
Burkina Faso
Guinea
Cameroon
Benin
Nigeria
Source: WTTC 2008
85 11. Impact of Aviation/Airport Safety and Security on Air Services Frequency and Price
7. Air transport services in Africa, and especially WCA countries, are characterized by the scarcity of frequency offered as well as the high level offares they command. As shown in Figure 5, for international flights of comparable times and distance, people traveling to/from Africa will pay anywhere from 40 to 13 8 percent more per miles flown in business class. Such difference in price reflects mostly the lack of competition to/from Africa whereas non-African international carriers hold a dominant position on most international city pair services as local carriers, when they exist, cannot simply compete head-to-head with vastly larger European carriers in large part due to poor safety and reliability records that hamper their competitiveness. This situation is not, however, irreversible as shown by the successful growth of national, albeit partially privately owned, African carriers such as Kenya Airways or Air Senegal International which have succeeded in competing head-to- head with European carriers with the correlated results of lowering air fares on these routes as well as increasing frequency. One key aspect of these success story is that both carriers have benefited from secured and safe airport infrastructure (i.e,, both Dakar and Nairobi airports are certified by the US TSA for direct flights to the US) as well as adequately competent technical oversight from their respective civil aviation authorities (Le., Kenya is certified Level Iby the US FAA while Senegal is not far from obtaining this certification).
Figure 5: Compared return fares on a sample of WCA and other long haul routes
1 6,000
9 I 5,000
1 4,000
H^ 3 3,000 8 ‘C n
I 2,000
I 1,000
I 0 Paris-Dakar* Tokyo-Bangkok Paris-Abidjan’ Paris-Dubai Paris-Brazzadlle’ Paris- SantoDomingo 1 -Business class fare +Flight time 1 I *West African long haul routes Source: Iches, Michel.: “Air Transport in Western and Central Africa: Facts and Issues.” The World Bank Group, August 2003.
86 8. A similar situation, although with even more pervasive effects exists in WCA regional aviation markets. Here competition is even more restrained as countries continue to protect jealousy their national carriers behind safety and security arguments in spite of the adoption of the YD whose main purpose was to fully liberalize regional traffic. Indeed, time and time again evaluations of the YD have shown that most countries were failing in implementing it with the worst offenders often hosting national champions. It has become amply clear, therefore, that any improvements in the general level of aviation safety and security in WCA would preclude most countries from using the safety and security arguments to restrict market access and, thus, result in increasing service frequency as well as, more than likely, lower air fares.
111. Impact of AviatiodAirport Safety and Security on Investment
9. According to a survey made by the consultant agency Healey and Baker in 2003, at a worldwide level, 56 percent of international companies consider international air transport links to be an essential factor for locating businesses. Another survey made by IATA showed that 18 percent of businesses’ past investment decisions were directly affected by the absence ofreliable, safe and secure air transport links. This suggests that providing SSA countries with minimum safety and security requirements in the civil aviation field can contribute to creating investment-attractive conditions for international companies.
10. An example of these investment-attractive conditions is the ability to negotiate and to conclude partnerships: a survey made by the Aviation Services of the City of London pointed out that while new technology, such as video or audio conferencing, can be useful, companies in the financial and business services sector still consider flying for face-to-face meetings to be essential for winning new business and developing clients’ relationships. However, among the Safety and Security Program’s objectives is that Airport authorities have adequate procedures in terms of passengers’ control. A survey made by IATA in 2005 on a poll of 5 countries (Chile, China, the Czech Republic, France, the US) demonstrated that more than 65 percent of businesses consider passenger air services as vital or very important for servicing or meeting consumer. Chinese firms for instance place the greatest reliance on passenger air services for servicing or meeting clients, with nearly 90 percent of their businesses reporting that they are vital or very important.
11. Also, overall, 85 percent of businesses report that passenger air services are at least sometimes important for their sales, with 70 percent considering them to be either vital or very important. This dependency on air services means that companies have incentives to locate their operations in the vicinity of major airports. Broadening the conclusions of this survey to WCA countries shows that the program could have significant benefits on the overall region’s investment climate.
IV. Impact of Aviation/Airport Safety and Security on Exports Trade
12. A safe and secure air transport system is one of the major levers to sustain growth in the volume and the value of the goods. Indeed, worldwide, up to 40 percent of the value of international trade in manufactured goods is transported by air. However, 60 percent of air cargo is actually carried as belly cargo by passenger airplanes. This means that air cargo
87 rates are directly affected by the level of competition that exists on any given routes between passenger airlines. As such, favorable international air cargo rates to/from WCA cannot be secured without a vibrant air passenger, market which itself is subjected to the limitation imposed by low safety and security standards in the region. As shown by the example of Kenya and Senegal, selected high value perishable high value agricultural goods such as cherry tomatoes (Senegal) or flowers (Kenya) can only gain international market access if the countries where they are produced have direct and affordable air links with their export markets (Le., Western Europe in the case of Senegal and Kenya). Once more, such air services depend in large part on the level of air security and safety that the exporting countries maintain.
V. Conclusions
13. Improvements in WCA’s aviation security and safety standards will not in and by themselves increase tourist flows, inward international direct investment or international trade. However, they will undoubtedly be an important enabler of future growth in these activities as all depend heavily on the ease, affordability and access to the WCA market. The program should, therefore, be viewed as an important building stone in the overall economic development strategy of the WCA countries.
VI. References
- Air Transport Action Group (ATAG), “The economic and social benefits of air transport” (2005) - IATA, PriceWaterHouseCoopers : G Etude de la Mise en Place d’une Structure Autonome de gestion de 1’Aviation Civile en RCpublique DCmocratique du Congo. Projet de Rapport de la phase 1 )) (19 AoQt 2005) - Iches, Michel: “Air Transport in Western and Central Africa : Facts and Issues.” The World Bank Group, August 2003. - UN Economic Commission for Africa: “Tourism in Africa and the Multilateral Trading System: Challenges and Opportunities.” Adrian Gauci, Vittorio Gerosa, Cornelius Mwalwanda - United Nations Conference on Trade and Development, Economic Development in Africa. “Rethinking the Role of Foreign Direct Investment”, United Nations, Geneva and New York 2005. - WTO-S.A.F.E Program report: “The WTO strategy on Security and Facilitation Enhancement.” Assembly, 35” session. August 24, 2004 - West and Central Africa Air Transport Safety and Security Program: Program Appraisal Document, Minutes, Notes and PowerPoint presentation of the Decision Meeting. The World Bank, October 18, 2005. - Air Transport Action Group (ATAG), “The economic and social benefits of Air Transport”, 2008
88 Annex 10: Safeguard Policy Issues
West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
1. The program is rated as a Category C project. Therefore, Safeguard Policy Issues are not applicable.
89 Annex 11: Program Preparation and Supervision
West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
~~- l___-__ll_l-~ Planned date of mid-term review June 30,2012 Planned closing date December 3 1,20 13
Key institutions responsible for preparation ofthe program:
0 ANACS (Senegal)
0 ANAC (Benin) HAALSS (Senegal)
Bank staff and consultants who worked on the program included:
Sariette Jippe AFTTR j Michel Iches ' AFTTR
Specialist ~ AFTFM j Specialist i AFTFM 1 AFTPC I
Seynabou Seye (Senegal) ; Program Assistant ' AFCFl
Marie Gave j STT i AFMMR
90 ' Charles Schlumberger Sr. Air Transport Specialist ETWTR t-' 1 Gael Raballand Transport Economist AFTTR 1
Bank funds expended to date on program preparation: 1. Bank resources: US$160,411.80 2. Trust funds: US$O.OO 3. Total: US$160,411.80
Estimated Approval and Supervision costs: 1. Remaining costs to approval: US$5,000 2. Estimated annual supervision cost: US$120,000
91 Annex 12: Documents in the Program File
West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
IDA processing internal documents:
Project Concept Note (January 2008) Integrated Safeguards Data Sheet - Concept stage (April 2008) Countersigned Integrated Safeguards Data Sheet - Appraisal stage (July 2008) Revised Countersigned Integrated Safeguards Data Sheet - Appraisal stage (November 5,2008) Project Information Document - Concept stage (April 2008) Project Information Document - Appraisal stage (July 2008) Revised Project Information Document - Appraisal stage (November 12,2008) Aides-memoire Preparation mission (April 2008) Minutes of the Decision Meeting (July 2008) Aide-memoire Evaluation mission (October 2008) Minutes of the Negotiations (November 2008) Status of Negotiations (November 2008)
Clients’ documents:
Procurement - Benin Procurement Plan (June 2008 and December 2008) - Senegal Procurement Plan (June 2008)
Legal documents - Letters approving negotiated documents (Benin: November 2008 - Senegal: December 2008)) - Letters nominating signatories to the Statutory Committee Reports (Benin: November 2008 - Senegal: December 2008) - Benin: Decision No. 043 on Project Procurement Procedures - Senegal: Decree No. 00001 650 dated November 2 1, 2008, creating the Project Steering Comittee - Benin: Arrete No 1096 dated September 12,2008, creating the Project Steering Comittee
Other documents
- Projet “COSCAP” pour la supervision de la sdcuritd aerienne dans les Etats membres de la CEMAC et de Sao Tome e Principe - Document Cadre (July 2000)
- Questionnaire Banque mondiale pour l’amelioration de la SCcurite et de la Sfirete adriennes (Mai 2004)
- OSTA Safety Audit of African Airlines (July 2004) - ICAO safety audits for Benin and Senegal (2006 and 2007)
92 Annex 13: Statement of Loans and Credits BENIN:
Difference between expected and actual Original Amount in US$ Millions disbursements Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm Rev’d PI04881 2008 Compet & Integrated Growth Opportunity 0.00 25.00 0.00 0.00 0.00 24.71 0.00 0.00 PO96056 2007 BJ- Multi Sectoral HIViAIDS SIL 2 0.00 35.00 0.00 0.00 0.00 30.48 3.33 0.00 (FY07) PO96482 2006 BJ-MalariaCntrl Booster Prgm SIL (FY06) 0.00 31.00 0.00 0.00 0.00 16.69 7.75 0.00 PO82725 2006 BJ-Decentral City Mgmt 2 (FY06) 0.00 75.00 0.00 0.00 0.00 49.67 3.77 0.00 PO81484 2005 BJ-Natl CDD SIL (FY05) 0.00 50.00 0.00 0.00 0.00 23.06 9.63 0.00 PO79633 2005 BJ-Energy Srvc Delivery APL (FYOS) 0.00 52.00 0.00 0.00 0.00 30.50 20.62 -4.81 Total: 0.00 268.00 0.00 0.00 0.00 175.11 45.10 - 4.81
BENIN STATEMENT OF IFC’s Held and Disbursed Portfolio In Millions of US Dollars
Committed Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic 2000 FMADEV 0.00 0.34 0.00 0.00 0.00 0.34 0.00 0.00 Total portfolio: 0.00 0.34 0.00 0.00 0.00 0.34 0.00 0.00
Approvals Pending Commitment FY Approval Company Loan Equity Quasi Partic.
Total pending commitment: 0.00 0.00 0.00 0.00
93 Annex 13: Statement of Loans and Credits SENEGAL:
Difference between expected and actual Original Amount in US$ Millions disbursements Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm. Rev’d P105881 2009 SN-Sustainable Mgt of Fish Resources 0.00 3.50 0.00 0.00 0.00 3.55 0.00 0.00 PI05279 2008 SN-En. Sec. Recov. Dev Policy Financing 0.00 80.00 0.00 0.00 0.00 23.24 1.67 0.00 PO84022 2007 SN-Local Authorities Development 0.00 80.00 0.00 0.00 0.00 66.24 18.42 0.00 Program PO89254 2007 SN-Quality EFA APL 2 (FY07) 0.00 30.00 0.00 0.00 0.00 24.39 8.95 0.00 PO97181 2007 SN-Nutr Enhanc. Prog I1 - APL (FY07) 0.00 15.00 0.00 0.00 0.00 4.10 -2.76 0.00 PO93622 2006 SN-Agr Svcs & Prod Orgs APL 2 (FY06) 0.00 20.00 0.00 0.00 0.00 10.70 1.77 0.00 PO88656 2006 SN-Participatory LOCDev Prgm (FY06) 0.00 50.05 0.00 0.00 0.00 34.31 23.61 0.00 PO83609 2006 SN-Agr Markets & Agribus Dev (FY06) 0.00 35.00 0.00 0.00 0.00 28.59 4.64 0.00 PO86480 2005 SN-GIRMAC SIL (FY05) 0.00 10.00 0.00 0.00 0.00 4.01 2.10 0.00 PO85708 2005 SN-Elec. Sew. for Rural Areas (FY05) 0.00 29.90 0.00 0.00 0.00 20.96 19.10 -0.50 PO73477 2005 SN-Elec Sec Eft7 Enhanc.Ph&e 1 APL-I 0.00 15.70 0.00 0.00 0.00 12.41 12.38 2.39 PO69207 2005 SN-Casamance Emerg Reconstr Supt 0.00 20.00 0.00 0.00 0.00 4.60 3.74 0.00 (FY05) PO80013 2004 SN-Priv Sec Adj Crdt (FY04) 0.00 45.00 0.00 0.00 0.00 2 1.40 20.21 20.21 PO51609 2003 SN-Priv Inv Promotion SIL (FY03) 0.00 46.00 0.00 0.00 0.00 19.96 14.55 0.00 PO74059 2002 SN-HIVIAIDS Prevent & Control APL 0.00 30.00 0.00 0.00 0.00 10.70 5.78 3.24 (FY02) PO41528 2001 SN-Long Term Water Sec SIL (FYO1) 0.00 125.00 0.00 0.00 0.00 5.48 -15.41 -19.24 Total: 0.00 635.15 0.00 0.00 0.00 294.64 118.75 6.10
SENEGAL STATEMENT OF IFC’s Held and Disbursed Portfolio In Millions of US Dollars
Com m itted Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic. 1980 BHS 0.00 0.46 0.00 0.00 0.00 0.46 0.00 0.00 1999 Ciments du Sahel 10.20 2.26 3.12 0.00 10.20 2.26 3.12 0.00 1997 GTI Dakar 10.41 1.68 0.00 9.04 7.49 1.51 0.00 9.04 1998 GTI Dakar 1.20 0.00 0.00 0.00 1.17 0.00 0.00 0.00 2005 Ko u n o u n e 21.67 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2001 SEF Royal Saly 1.41 0.00 0.00 0.00 1.41 0.00 0.00 0.00 Total portfolio: 44.89 4.40 3.12 9.04 20.27 4.23 3.12 9.04
94 Approvals Pending Commitment FY Approval Company Loan Equity Quasi Partic
Total pending commitment 0 00 0 00 0 00 0 00
95 Annex 14: Current Safety Oversight and Accident Situation of Air Transport in WCA
West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
70
60 60
50
40
30
20
10
0 Asia Pacific Eastern and Europe Middle East North and south West and Southern Central America Centra I Africa America Africa
Lack of Effective Implementation of SARPs (in percent) Accident Rates in 2000 (per million of scehduled departures)
This chart, which was prepared on the basis of information received by ICAO, demonstrates the relationship between the lack ofadequate air transport safety oversight and accidents. The left column for each region shows the percentage of findings (non-compliance) of ICAO's audits of the regions CAA. The right column shows the accident rates of scheduled air traffic. For the chart we clearly can derive two conclusions:
1. Poor safety oversight correlates directly with high accident rates; 2. West and Central Africa region has the highest accident rate, about 30 times higher than the USA (for illustration: the US would have one major air crash every single week if they had the same safety record as WCA countries).
In order to successfully address the safety issues of any country, adequate safety oversight by the county's Civil Aviation Authority must be the prime focus.
96 Annex 15: Country Selection Process
West and Central Africa Air Transport Safety & Security APL Program Phase 2-B
1. Tables 1 and 2 present the Program Team’s analysis and rationale for a phased approach based on each WCA country’s ability, willingness and expected benefit from participating in this program. Table 1 presents the evaluation criteria used to assess which country should be included in any or all of three program phases. These are, namely:
Financial capacity - For this criterion, the Program Team used for each country the budget of the civil aviation agency. This level provides a good indication of the amount of resources that each country can dedicate to ensure long term sustainability of security improvements that would result from the project implementation. Unfortunately, these figures are not always available, in particular for the countries where the CAA is not yet financially autonomous. Safety - for this criterion, the Program Team used the rating employed by the US Federal Aviation Agency (Le., the International Aviation Safety Assessment program - IASA) to determine whether the countries in the program had already reached an adequate level of safety compliance. Security - US Transport Security Agency (TSA) agency certification was used to assess whether a given airport was secured enough to allow for direct flights connection to/from the US. Need for Program Assistance - based on the outcome of the three previous criteria (Le., financial capacity, safety and security) as well as the review of existing ICAO’s security assessment reports for 17 country’s airports, the Program Team assigned a rating scale of high, medium or low need for program assistance to each country. Using this rating, one country: Cape Verde whose CAA is already IASA certified and has direct flight rights with the US, was judged to not requiring assistance. All other countries, with the exception of Senegal, Gabon and the Gambia, saw their need for this program ranked high. Gabon and the Gambia’s medium rating came primarily from the fact that both countries CAA have relatively high level of resources and proven achievements track record. Program Impact on Aviation Activities Growth - this criterion was used in recognition of the fact that similar improvements in aviation safety and security would have different impacts in the countries included in the program. Like the previous criteria, a rating scale of high, medium and low was used. In this specific case, the Program Team reviewed each country to evaluate whether aviation security and safety improvements would spur aviation activities growth because they would suddenly enable that country or that country’s main international airport to: 1) promote international tourism more efficiently (Le., lower airline insurance costs, thus lower the cost of tourism in this country - case of the Gambia), 2) maintain or enhance its status as a regional hub &e., case of Abidjan or Douala) or 3) strengthen international services to/from this country (Le., case of Senegal and to a lesser degree of the Republic of Congo, Central African Republic, Cameroon, Gabon, Guinea and Mali). For those countries which had received a low rating, the Program Team judged that the level of aviation activities in these countries were highly dependent on local economic and political conditions and that, although highly desirable, improvements in aviation safety
97 and security would not make a significant difference in the level of their aviation activities. Capacity to Implement - this last criterion was utilized to evaluate the risk associated with implementing the national component of the program. Like both previous criteria, a rating scale of high, medium and low was used. Individual country ratings were assigned based on the Bank’s prior experience in implementing projects in these countries as well as the Program Team specific knowledge of the respective program implementation capacity of local CAAs and airport authorities.
2. Using the results of this evaluation, the Program team assigned each country to none, one, two or three of the phases listed in Table 1 with:
Phase I:It includes the countries that were judged to be the most ready and where program assistance could immediately yield high returns. These are Guinea, Cameroon, Mali and Burkina-Faso. Phase 11: After Nigeria, two new countries are now being incorporated in Phase two of the program, which are Senegal and Benin. Phase 111: it takes into account all the remaining countries.
3. The Program Team proceeded then to develop estimates of the level of investment necessary to implement the components of the program, with, however, the actual figures for the countries of Phase I(Cameroon, Guinea, Mali and Burkina-Faso) and Phase II-A (Nigeria). Table 2 presents the results of this work. As can be seen, cost estimates were produced for each country’s CAA and airport-related components grouping the remaining ones in a last category called “other”.
4. For each country, the number of airports to be covered under the program was taken into account as well as Program Team knowledge of current airport security installations based on recent physical inspections of these facilities (e.g., Abidjan, Douala, YaoundC) or ICAO inspections reports. Using these cost item figures, total estimated cost to implement the national component of the program for the countries in Phases I, I1 and 111 came, respectively, at US$33.57, 62.65 and 55.28 million.
98
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- 1 3 *45 .$ T C a .- ef $ 2 I _1 e Annex 16: Country at a Glance West and Central Africa Air Transport Safety and Security Program Phase 2-B - BENIN
Sub- POVERTY and SOCIAL Saharan Low- D evelo pment diamond. Benin Afrlca Income 2007 Population, mid-year (miliions) 9.0 600 128 Life expectancy GNI per capita (Atlas method, US$) 570 952 576 GNI (Atlas method, US$ billions) 51 762 749 r Average annual growth, 2001-07 Population (%! 3.2 25 22 GNI Gross Labor force (%) 3.4 26 27 per primary Most recent estlmate (latest year avallable, 2001-07) capita enrollment Poverty (%of population below nationalpovertyline) Urban population (%of totaipopulation) 41 36 32 Life expectancy at birth (pars) 56 51 57 I infant mortality (per I000 live births) 68 94 a5 Child malnutrition (%of children under5) 22 27 29 Access to improvedwatersource Access to an improvedwater source (%o fpopulatfon) 65 58 66 Literacy (%ofpopulation age ?5Y 35 59 61 Gross primary enro llment (%of school-age population) 98 94 94 -B enin Male 135 9Q 130 __ Low-incomegroup Female 87 88 89
KEY ECONOMIC RATIOS and LONG-TERM TRENDS
1987 1997 2006 2007 Economic ratios* GDP (US$ billions) 16 2.2 46 54 Gross capital formation1GDP a.9 8.4 Trade Exports of goods and ServicesIGDP 15.3 8.1 Gross domestic savingslGDP -2.8 5.6 Gross national SavingsIGDP 0.8 no Current account balancelGDP -5.9 -7.4 -9 0 -7 6 Domestic Capital Interest payments1GDP 10 0.8 03 savings formation Total debVGDP 76.4 75.5 776 Total debt servicelexports 7.5 P.7 136 Present valueof debtiGDP r)9 Present value of debtlexports 645 Indebtedness 1987-97 1997-07 2006 2007 2007-11 (average annual gm Wh) GDP 3.7 4.2 3.8 4.6 --Benin GDP percapita 0.1 10 0.6 1.5 - Low-incomegmup Exports of goods and sewices 2.7 2.3
STRUCTURE of the ECONOMY 1987 1997 2006 2007 Growth of capltal and GDP (Oh) (%of GDP) Agncuiture 333 375 30 T I Industry a4 #5 M anufactunng 72 90 Services 544 481
Household final consumption expenditure 672 842 1 02 03 04 05 08 07 General gov't final consumption expenditure 155 132 Imports of goods and services 310 269 -GCF -GDP I
1987-97 1997-07 2006 2007 Growth of exports and imports (%) (average annuaigmwth) ~gnculture 56 49 6 Industry 54 47 4 M anufactunng 65 44 Services 18 39 2 Household final consumption expenditure 34 16 0 02 03 04 05 06 07 General gov't final Consumption expenditure 14 95 2 Gross capital formation 56 136 217 73 imports of goods and services 22 29
Note 2007 data are preliminaryestimates This table was producedfrom the Development Economics LDB database 'Thediamonds showfourkeyindicators in thecountry(in bo1d)comparedmthits income-group average If dataare missing thediamondmll be incomplete
101 Benin
PRICES and GOVERNMENT FINANCE 1987 1997 2006 2007 Domestic prices (%change) Consumer pnces 38 30 25 Implicit GDP deflator 30 50 30 2.9 Government finance (%of GDP, includes current grants) Current revenue 156 Current budget balance 3.7 Overall SUrPlUSldefiCit -3 0
TRADE 1987 1997 2006 2007 Export and Import levels (US$ mlll.) (US$ millions) Totaleqorts (fob) 98 49 Ginned cotton 55 145 ““ii CNdeoll 32 7 800 M anufactures Totalimports (cif) 262 426 400 Food 132 DO 200 Fuel and energy 33 48 Capital goods 130 239 0 03 Export pnce index(2000=WO) ni 01 02 04 05 06 07 Import pnce index(2OOO-WO) 93 Exports mlmports Terms of trade (20OO=WO) Is I
BALANCE of PAYMENTS 1987 1997 2006 2007 Current account balance to GDP (Oh) (US$ miilions) Exports of goods and services 457 347 Imports of goods and services 602 623 Resource balance -145 -276
Net income -29 -30 -52 -55 Net current transfers 81 147 Current account balance -93 -159 -415 Financing items (net) 58 173 Changes in net reserves 35 -14 Memo: Reserves including gold (US$ miilions) 496 492 Conversion rate (DEC locaVUSS) 300 5 583.7 522.9 479 3
EXTERNAL DEBT and RESOURCE FLOWS We7 1997 2006 Composltlon of 2006 debt (US$ mill.) (US$ millions) Total debt outstanding and disbursed 184 1,627 824 IBRD 0 0 0 0 IDA 1B6 5D P6 176 Totaldebt service 41 55 83 IBRD 0 0 0 0 IDA 2 7 11 1 Composition of net resource flows Official grants 58 t?6 1131 E 369 Official creditors 57 22 6 Pnvate creditors -1 0 0 Foreign direct investment (net inflows) 0 27 63 Portfolio equity(net inflows) 0 2 2 World Bank program Commitments 48 0 30 Disbursements 22 20 32 Pnncipal repayments 0 4 8 0. Short-term Net flows 21 6 24 43 Interest payments 1 4 4 1 Net transfers 20 t? 20 41
Note:This tabiewas producedfrom the Development Economics LDB database. 9/24/08
102
Senegal
PRICES and GOVERNMENT FINANCE 1987 1997 2006 2007 Domestic prices (%change) Consumer prices -4.1 18 2.6 17 Implicit GDP deflator -16 2.1 3.4 52 Government finance (%of GDP. includes current grants) Current revenue 170 '5.3 20.4 211 Current budget balance 06 4.6 6.3 65 -GDPdelidor -CPI Overall surplusldeficit -19 -15 -4.1 -51 I I
TRADE 1987 1997 2006 2007 Export and Import level8 (US$ mlll.) (US% miliions) , Total exports (fob) 671 904 1628 159 4 000 T Groundnut products 70 50 36 42 Phosphates 66 146 61 95 Manufactures 157 254 336 336 Total imporls (cif) 1119 1306 3,437 3,574 Food 208 289 458 460 Fuel and energy 177 91 47 40 Capital goods 66 82 372 376 01 02 03 04 05 OB 07 Export pnce index(2000=WO) 68 98 D6 99 1 I Impon price index (2000=WOJ 58 96 P1 120 mExportr mlnpOl35 Terms of trade (20OO-Wo) la 02 87 83
BALANCE of PAYMENTS 1987 1997 2006 2007 Current account balance to GDP (%I (US% millions) Exports of goods and servlces 102 1276 2,342 2,522 Imports of goods and services 1474 1568 4,045 4,351 Resource balance -342 -291 -1703 -1829
Net income -198 -72 -82 -66 Net current transfen -6 n8 866 100 Current account balance -556 -185 -980 -1002 Financing items (net) 582 88 805 105 Changes in net reserves -26 n 75 -04 Memo: Reserves including gold (US$ millions) 23 395 897 903 Conversion rate (DEC. loca//US%) 300.5 583.7 522.9 479 3
EXTERNAL DEBT and RESOURCE FLOWS 1987 1997 2006 2007 Composition of 2006 debt (US$ mlll.1 (US% mriifons) Total debt outstanding and disbursed 4 027 3,795 1,984 IBRD 06 n 0 0 G 95 IDA 506 1187 495 671 I Total debt service 387 251 202 IBRD 20 9 0 0 IDA 5 17 26 5 Composition of net resource flows Official grants 206 238 2,408 Official creditors 298 n2 ln Pnvate creditors -25 15 6 Foreign direct investment (net inflows) -4 76 58 Portfolio equity(net inflows) 1 8 0 World Bank program Commitments 00 84 320 35 A. IBRD E. Biimera Disbursements 00 60 01 03 8.IDA D.Othnrmltilatnrsl F.Prlv.de Pnncipal repayments Q 15 15 1 C.IMF G-Short-tnrl Net flows 08 45 16 03 Interest payments 0 0 0 5 Net transfers 95 35 06- 08 Note This table was produced from the Development Economics LDB database 9/24/08
104 MAP SECTION
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