Gabonese Republic
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AFRICAN DEVELOPMENT BANK COUNTRY : GABONESE REPUBLIC APPRAISAL REPORT Public Disclosure Authorized DATE: 3 SEPTEMBER 2018 GABONESE REPUBLIC: WATER AND SANITATION SECTOR DEVELOPMENT PROGRAMME - FIRST LIBREVILLE INTEGRATED DRINKING WATER SUPPLY AND SANITATION PROGRAMME (PIAEPAL) - DRINKING WATER COMPONENT Public Disclosure Authorized RDGC/AHWS/GOGA September 2018 Translated Document TABLE OF CONTENTS I – STRATEGIC THRUST AND OBJECTIVES ................................................................. 1 1.1. PROJECT LINKAGES WITH COUNTRY STRATEGY AND OBJECTIVES .............. 1 1.2. RATIONALE FOR BANK’S INVOLVEMENT ............................................................. 1 1.3. AID COORDINATION ...................................................................................................... 2 II – PROJECT DESCRIPTION ......................................................................................... 3 2.1. PROJECT COMPONENTS ......................................................................................... 3 2.2. TECHNICAL SOLUTIONS ADOPTED AND ALTERNATIVES EXPLORED ............ 5 2.3. PROJECT TYPE .......................................................................................................... 6 2.4. PROJECT COST AND FINANCING ARRANGEMENTS ............................................ 6 2.5. PROJECT AREA AND BENEFICIARIES ................................................................... 7 2.6. PARTICIPATORY PROCESS ...................................................................................... 7 2.7. BANK GROUP AND EXPERIENCE REFLECTED IN PROJECT DESIGN ............. 8 III – PROJECT FEASIBILITY .............................................................................................. 8 3.1. PROJECT ECONOMIC AND FINANCIAL PERFORMANCE ................................... 8 3.2. ENVIRONMENTAL AND SOCIAL IMPACT .............................................................. 9 IV IMPLEMENTATION ...................................................................................................... 11 4.1. IMPLEMENTATION ARRANGEMENTS .................................................................. 11 4.2. MONITORING ........................................................................................................... 14 4.3. GOVERNANCE .............................................................................................................. 14 4.4. SUSTAINABILITY ..................................................................................................... 15 4.5. RISK MANAGEMENT ............................................................................................... 16 4.6. KNOWLEDGE BUILDING ....................................................................................... 16 V – LEGAL FRAMEWORK ................................................................................................ 16 5.1. LEGAL INSTRUMENT .............................................................................................. 17 5.2. CONDITIONS FOR BANK INVOLVEMENT ............................................................ 17 5.3. COMPLIANCE WITH THE BANK POLICIES ......................................................... 18 5.4. RECOMMENDATION ............................................................................................... 18 Annex 1: Comparative Socio-economic Indicators of the Country Annex 2: Key Related Projects Financed by the Bank and other Development Partners Annex 3: Map of the Project Area Annex 4: Justification for Reducing Gabon's Counterpart Funding Annex 5: Logical Framework for the Drinking Water Supply and Sanitation Sector Development Programme in Gabon Currency Equivalents (June 2018) Currency Unit UA 1 = CFAF 794.31 UA 1 = CFAF 1.21092 EUR 1 = CFAF 655.00 Fiscal Year 1 January – 31 December Weights and Measures 1 tonne (t) = 2204 pounds 1 millimetre (mm) = 0.03937 inches 1 cubic metre (m³) = 1000 litters 1 kilometre (km) = 0.62 mile 1 metre (m) = 3.28 feet 1 hectare (ha) = 2.471 acres Acronyms and Abbreviations ADF : African Development Fund AFD : French Development Agency AfDB : African Development Bank ARSEE : Water and Electricity Sector Regulation Agency CNEE : National Water and Electricity Council DWS : Drinking Water Supply DWSS : Drinking Water Supply and Sanitation EU : European Union ESMP : Environmental and Social Management Plan IWRM : Integrated Water Resources Management NGO : Non-Governmental Organization PCU : Project Coordination Unit PD : Preliminary Design PGRHA : Water Resources Management and Sanitation Programme PIAEPAL : Libreville Integrated Water Supply and Sanitation Programme PSGE : Emerging Gabon Strategic Plan SEEG : Société d’Energie et d'Eau du Gabon (Gabon Water and Power Utility) SP : Société de Patrimoine (Assets Company) STEP : Treatment and Purification Plant TFP : Technical and Financial Partners UA : Unit of Account WB : World Bank WHO : World Health Organization i PROJECT INFORMATION Client Information DONEE/BORROWER : Government of the Gabonese Republic EXECUTING AGENCY : Ministry of Water and Energy 852 Boulevard Triomphal Libreville B.P. 1172 Libreville Gabonese Republic Tel: (241) 01721514 Email: [email protected] Financing Plan Source Amount (UA) Instrument AfDB 96.95 million Loan TOTAL COST 96.95 million AfDB's Key Financial Information _____________________________________________________________________________________ Loan Currency Euro (EUR) [or any other acceptable currency] Type of Loan Fully flexible loan Maturity 20 years Deferred amortization 5 years Weighted Average 12.75 years Maturity** Reimbursements Half-yearly payments at the end of the deferred amortization period. Interest Rate Base rate + Funding margin + Lending spread + Maturity premium. This interest rate must be above or equal to zero. Base Rate: Floating (EURIBOR 6 months revised every 1st February and 1st August), with a free floating base rate option. Financing Cost Margin The Bank's financing cost margin revised every 1st January and 1st July and applied every 1st February and 1st August with the base rate. Lending Spread 0 basis points (0.8%) Maturity Premium 0.00% Front-end Fees 0.25% of the loan amount payable latest on the date of signature of the loan Agreement. Commitment Fee 0.25% per year on the undisbursed amount. It shall become effective 60 days following the date of signature of the loan agreement and shall be payable on the due dates. ii Base Rate Conversion Besides the free fixing option, the Borrower may revert to the Option* floating rate or reset the rate on all or part of the disbursed amount of its loan. Transaction fees apply. Rate Cap or Collar Option* The Borrower may cap or collar the base rate for all or part of the disbursed amount of its loan. Transaction fees apply. Loan Currency Conversion The Borrower may change the currency of all or part of its loan, Option* : whether disbursed or not, into another loan currency of the Bank. Transaction fees apply. FRR, NPV (base case CFAF 10,401.70 billion at 12% discount rate scenario) ERR (base case scenario) 13.59% *where applicable Timeframe-Main Milestones (expected) Concept Note Approval May 2018 Project Approval September 2018 Effectiveness December 2018 Last Disbursement June 2023 Completion December 2022 iii Executive Summary 1. Project Overview: Libreville's first Integrated Water Supply and Sanitation Sub- Programme is part of Government's programme to develop the Drinking Water Supply and Sanitation (DWSS) sector. The achievements envisaged under this vast programme stem from the ambition to guarantee, by 2025, sustainable universal access to drinking water and sanitation in a healthy and improved living environment nationwide. PIAEPAL aims to strengthen and improve drinking water and sanitation services in Greater Libreville. It will cost UA 200 million. The Government requested funding from the Bank for the drinking water component of this sub-programme, which involves building the institutional capacity of the DWSS sector, reinforcement and a 280-kilometre extension of the drinking water network in Greater Libreville comprising the Libreville, Akanda, Owendo and Ntoum municipalities, and preparation of the next phase in the form of a project. The total cost of the component to be financed by the Bank is UA 96.95 million. It is scheduled to be implemented over a 4-year period. 2. The project will generate considerable and tangible positive socio-economic and environmental benefits for the 920,000 inhabitants of Greater Libreville and the natural environment: (i) a regular supply of safe drinking water in sufficient quantities; (ii) time savings especially for women who are often forced to wait long hours at night to fetch water; and (iii) significant savings on household budgets as a result of fewer incidents of waterborne diseases, malaria and the improvement of living conditions in general. Stakeholder involvement is crucial for investment sustainability. Initiated during the project identification and preparation missions, this process continued through the ESIA, including public consultations and meetings with the appraisal mission, and will be maintained during the implementation phase. 3 Needs Assessment. The city's current drinking water production capacity is 230 000 m3/d against a production need of 280 000 m3/d, i.e. a deficit of 50 000 m3/d. To meet Greater Libreville's water needs up to 2035, the Drinking Water Master Plan prepared in March 2016 recommended the completion of work on the future Ntoum 7 drinking water production