Document of The World Bank OpWy FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 1829a-SYR Public Disclosure Authorized SYRIA STAFF APPRAISAL REPORT OF A THIRD HIGHWAYPROJECT Public Disclosure Authorized March 16, 1978 Public Disclosure Authorized Projects Department Europe, Middle East and North 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. CURRENCY EQUIVALENTS Currency Unit = Syrian Pound (SL) S:L1 = US$0.26 SL 1,000 = US$256 SL 1,000,000 = US$256,410 US$1 = SL 3.9 WEIGHTS AND MEASURES Metric System British/US System 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) 2 = 0.62 miles (mi) 2 1 sq kilometer (km ) = 0.386 sq miles (mi ) 1 hectare (ha) = 2.117 acres (ac) 1 liter (1) = 0.2200 imperial gallons (1 gal) = 0.2642 US gallons (gal) 1 metric ton (m ton) = 2.205 pounds (lb) ACRONYMS AND ABBREVIATIONS ADT - Average Daily Traffic ER - Economic Return ILO - International Labor Organization MOC - Ministry of Communications MOT - Ministry of Transportation SPC - State Planning Commission UNDP - United Nations Development Programme USAID - United States Agency for International Development SYRIAN ARAB REPUBLIC FISCAL YEAR January 1 to December 31 FOR OFFICIAL USE ONLY STAFF APPRAISAL REPORT THIRD HIGHWAY PROJECT SYRIAN ARAB REPUBLIC Table of Contents . Page No. I. THE TRANSPORTATION SECTOR ............... I A. Effects of Geography and Economic Growth on Transportation ................................. 1 B. The Transportation System ...................... I C. Transportation Policy, Planning and Coordination ................................... 5 D. Previous Projects ........................... , 7 II. THE HIGHWAY SUBSECTOR ............................... 8 A. Network ........................................ 8 B. Traffic ........................................ 9 C. Administration ................................. 11 D. Planning ....................................... 12 E. Financing ...................................... 13 F. Engineering .................................... 14 G. Construction ................................... 15 H. Maintenance .................................... 16 I. Training ....................................... 17 IIl. THE PROJECT ......................................... 17 A. Objectives ........... .......................... 17 B. Description .................................... 18 C. Engineering .................................... 20 D. Cost Estimates ................................. 22 E. Financing ...................................... 26 F. Implementation ................................. 26 G. Disbursements .................................. 29 H. Environmental Impact ........................... 30 IV. ECONOMIC ANALYSIS ................................... 31 A. Main Benefits and Beneficiaries .... ............ 31 B. Highway Construction .......................... 32 C. Other Project Elements ......................... 38 V. AGREEMENTS REACHED AND RECOMMENDATIONS ....... ....... 39 This report was prepared by Messrs. B.H. Van Waes (Engineer) and Graham Smith (Economist). KThisdocument has a restricted distribution and may be used by recipientsonly in the performance of their official duties. Its contents may not otherwise be disclosedwithout World Bank authorization. Table of Contents (continued) ANNEX Related Documents and Data Available in the Project File Chart IBRD 18196 Syrian Arab Republic, Organization Chart of the Ministry of Communications MAPS IBRD 13261 Syrian Arab Republic, Transportation Infrastructure IBRD 13262 Syrian Arab Republic, The Highway Network I. THE TRANSPORTATION SECTOR A. Effects of Geography and Economic Growth on Transportation 1.01 The Syrian Arab Republic has an area of about 185,000 sq km of which only 34% is inhabited or cultivated, the remainder being mostly desert. The population in 1977 is estimated at 7.9 million and is growing at 3.3% p.a. About 47% of the population lives in urban areas and 25% in the two largest cities, Damascus, the capital (1,140,000) and Aleppo (880,000). Only 25% of the population is in the work force, of which half is employed in agriculture. Per capita GNP in 1976 was estimated at US$780, which represents a 2.5% per annum increase in real terms since 1970. 1.02 The basic layout of the Syrian transportation system (Map IBRD 1326L) has been dictated by its topography and different climatic zones; the coastal mountains to the west, the narrow fertile plain in the west-center, the Euphrates basin in the northeast and the desert areas in the center and east. The only natural corridors are the coastal and central plains for north- south movements, and the Euphrates River and the gap in the mountains between Homs and Tartous for east-west movements. Other important transportation corridors have to cross mountains (Damascus-Beirut and Aleppo-Lattakia) or the desert (Damascus-Baghdad). Rapid economic growth since the beginning of the 1970's has led Syria to initiate a major reorganization of its transportation system and to undertake large-scale construction projects to restructure its network and meet the new demands placed on it. B. The Transportation System 1.03 As of 1976, Syria's transport system consisted of: (i) 15,700 km of roads serving about 125,000 vehicles; (ii) 1,672 km of railways, comprising 341 km of narrow gauge lines in the southwest and 1,331 km of standard-gauge lines in the north; (iii) two general purpose ports and one crude oil port; (iv) two international airports, three secondary airports for domestic services, and one national airline; and (v) approximately 2,700 km of oil pipelines, comprising two international crude oil pipelines, a domestic crude oil line and a domestic oil products distribution system. Of this transportation system, 25% of the highway network, 32% of the railway network and 40% of Lhe port capacity have been built since 1970. 1.04 Inland transportation is dominated by highways, for both passengers and fr.ight. Although the role of the railways, at present very small, is expected to expaiLd appreciably in the next five years, highway transportation wil-Lremain dominafnt. Of an estimated 8 billion intercity passenger-km in 1976, highways carried nearly 98%, railways 2% and air a fraction of 1%. As for freight, of an estimated 8 billion intercity ton-km (exclusive of crude oil) highways carried 96% and rail 4%. International transit traffic of freight has grown rapi,iiyLn recent years, reaching a peak of 3 million tons in 1975, of which over 80% moved by highways. The railways have been hampered fromnplaying a greater role by the inconvenient layout of the network (see para. 1.06). -2- (a) Highways 1.05 Details of the highway subsector are discussed in Chapter II. (b) Railways 1.06 The Syrian railway network (Map IBRD 13261) is divided into two single-track systems of different gauges, the narrow-gauge system (the Hedjaz Railway) serving the capital and the southwestern half of the country and the standard-gauge system (the Northern Railway) the second largest city and the northern half of the country. There is no practical possibility of through shipments between the two systems. Each is managed by an autonomous authority under the Ministry of Transportation (MOT). Operating conditions on both systems are very poor, and the disconnected route sections, different gauges, low traffic volumes and low operating efficiency have all led to operating deficits. Traffic remained more or less static during the period 1970-75 in terms of passengers and tons, while increases in average trip distance led to a modest growth in terms of passenger-km and ton-km. Performance improved appreciably in 1976, with the opening of a new line from Lattakia to Aleppo, Deir-Ezzor and Qamishli. Traffic since 1970 has been as follows (all values in thousands): Passengers Freight Year Number Pass-km Number Ton-km 1970 1,113 86,500 1,406 101,700 1971 1,072 83,700 1,136 124,900 1972 1,035 68,700 1,172 154,000 197:3 988 68,900 828 123,100 1974 1,237 101,300 1,056 157,200 1975 1,292 135,600 1,066 124,900 1976 1,084 165,800 1,337 305,300 Period % Average Annual Growth Rate 1970-76 -0.5% 11.5% -1.0% 20% The principal commodities transported are wheat, barley and cotton. Up until 1976 average trip distances were far too short for economic operations; around 80 km for passengers and 100-150 km for freight. The system was incapable of competing effectively with highway transportation. 1.07 To correct this situation the railway is now carrying out a large- scale modernization and expansion plan, under preparation since the 1960's, aimed at providing the entire country with a unified standard-gauge railway network connecting the seaports with the main centers of production and con- sumption in Syria, Iraq, Jordan and Turkey. The expanded network would amount to about 2,500 km, consisting of three main routes: the first east-west from the port of Lattakia to Aleppo, Deir-Ezzor, Qamishli and Northern Iraq; the second line also east-west from the port of Tartous to Homs, the phosphate mines southwest of Palmyra, Deir-Ezzor and Central Iraq; and the third line - 3 - north-south from the Turkish border to Aleppo, Homs, Damascus and the Jordanian border. About 40% of the plan has been completed. Work is now underway on construction of the Homs-Damascus line and the line to the phos- phate mines at Mahin, and on reconstruction of part of the Homs-Tartous