FILE COPY ReportNo. 441a-1M : Appraisalof a Public Disclosure Authorized ThirdHighway Project

June24, 1974 Latin Anmericaand CaribbeanProjects Department Not for PublicUse Public Disclosure Authorized Public Disclosure Authorized

Documentof the InternationalBank for Reconstructionand Development Public Disclosure Authorized InternationalDevelopment Association

Thisreport was preparedfor officialuse only by the BankGroup. It maynot be published, quotedor cited without BankGroup authorization. The BankGroup does not acceptresponsibility for the accuracyor completenessof the report. Currency Equivalents

Currency Unit = Jamaican dollar (J$) US$1.00 - J$ 0.91 J$ 1 = US$1.10 J$ 1 million = US$1.1 million

Fiscal Year

April 1 to March 31

System of Weights and Measures

British/US Metric Equivalent

1 foot (ft) = 0.305 meter (m) 1 mile (mi) 2 1.609 kilometers(km) 2 2 2 1 square mile (mi ) = 2.589 square kilometers (km ) 1 pound (lb) a 0.454 kilogram (kg)

Abbreviations and Acronyms

ADT -- Average Daily Traffic CIDA - Canadian International Development Agency DC - Directorate of Construction DENS - Directorate of Electrical and Mechanical Services DM - Directorate of Maintenance DMP - Directorate of Major Projects DTS - Directorate of Technical Services GDP - Gross Domestic Product GNP - Gross National Product JRC - Jamaica Railways Corporation LVI - Lamarre Valois International Ltd., Consulting Engineers MOW - Ministry of Works NEC - National Economic Council NPA - National Planning Agency TPOS - T. P. O'Sullivan and Partners, Consulting Engineers TRRL - Transport and Road Research Laboratory UNDP - United Nations Development Program USAID - United States Agency for International Development JAMAICA

APPRAISAL OF A THIRD HIGHWAYPROJECT

TAB2E OF CONTENTS

Page No.

SUMMARY AND CONCLUSIONS ...... i - ii

1. INTRODUCTION ...... 1

2. THE TRANSPORT SECTOR ...... 3

A. The Country and its Economy ...... 3 B. The Transport Modes ...... 3 C. Transport Policy, Planning and Coordination 6

3. THE HIGHWAY SUBSECTOR ...... 7

A. The Road System and Road Transport ...... 7 B. Road Administration: The Ministry of Works. 8 C. Road Planning and Financing ...... 9 D. Engineering and Construction ...... 10 E. Maintenance ...... 10

4. THE PROJECT ...... 11

A. Project Description ...... 11 B. Cost Estimate, Financing and Disbursements . 14 C. Execution ...... 16

5. ECONOMIC EVALUATION ...... 17

A. General ...... 17 B. Arterial Road Construction Program ...... * 17 C. Technical Assistance ...... 19

6. AGREEMENTS REACHED AND RECOMMENDATION ...... 20

This Appraisal Report has been prepared by Messrs. S. Hertel (Engineer) and B. Chatelin (Economist) and has been edited by Hiss V. Foster TABLE OF CONTENTS(Cont'd)

TABLES

1. Road InvestmentProgram 2. Expenditureon Roads, 1965-1973 3. Road User Charges 4. Design Standards for Arterial Roads 5. Cost Estimate 6. Schedule of Disbursements 7. Traffic Forecast 8. Vehicle Operating Costs 9. Economic Return

CHART

Structure of the Ministry of Works

MAP

Jamaica - Third Highway Project - IBRD 10989 JAMAICA

APPRAISAL OF A IHIRD HIGHWAYPROJECT

SUMMARYAND CONCLUSIONS

i. The prime traffic moddein Jamaica is road transport. The highway network, comprising about 9,500 miles, is generally adequate in extent, although of low geometricstandard even for the arterial roads with very heavy traffic. The railway network, totaling about 210 miles, carries all the bauxite-aluminatraffic, a negligiblepart of other freight, and a small percentageof passenger transport. Air transporthas only limited importance for domestic traffic.

ii. During 1968-1970,the Canadian consultantsLamarre Valois Inter- national Ltd. (LVI) carried out a countrywidetransportation survey, followed in 1971-1972by feasibilitystudies for 320 miles of main roads and, in 1973, by final engineeringfor about 70 miles of high priority arterial roads. LVI's services were financed by the Canadian InternationalDevelopment Agency (CIDA). iii. The main element of the proposed project has been developed from LVI's studies and comprises the first phase of the Government's1974-1979 arterial road constructionprogram, i.e., the improvement,mainly in the form of new construction,of about 16 miles of two-lane arterial road sections between and Mandeville and one four-mile two-lane arterial road section between Spanish Town and Dcho Rios. The existing narrow and winding roads on these sections pass through many smaller towns and carry from 4,000 to 6,000 vehicles per day; the new arterial roads would bypass the towns. The road constructionworks would be supervisedjointly by the Ministry of Works (MOW) and consultants. iv. The proposed project provides also for the provision and installation of vehicle weighing stations and the procurement of a small amount of geotech- nical equipment. Technical assistancefor transportplanning for aid to local contractorsand for pavement evaluation and design is also included. v. Execution of the project would be the responsibilityof MOW and would extend over a period of about three years. This period is determinedby the time required for the civil works; these, in turn, have, in the Government's constructionprogram, been phased to restrict the load on the budget and on MOW to acceptablelevels. vi. About 86% of the constructionworks would be procured by international competitivebidding in compliancewith Bank Guidelines. This constructionwould consist of a number of contracts, and bidders would have the opportunity to bid for one or several contracts according to their capacity. The remaining 14% of construction,comprising the earthwork and pavement base of about four - ii - miles of road, would be executed by HOW on force account. MOW has the re- quired constructionequipment, staff and expertise to carry out such works efficiently. The weigh bridges for the vehicle weighing stations would be procured by internationalcompetitive bidding; the geotechnicalequipment would be procured by negotiated contract. vii. Quantifiablebenefits from the constructionelements of the project would derive from savings in vehicle-operatingcosts. On conservativeassump- tions, the economic return from the constructionof the road sections would be 17% tc624%, and the economic return of the project as a whole would be 20%. In adcition, the new road sections would reduce pollution and noise levels in the many built-up areas that would be bypassed. viii. The project is estimated to cost US$23.6 million equivalent,with a foreign exchange componentof US$13.7 million. The Government is seeking tech- nical assistance from UNDP and the British Government,amounting to about US$0.1 million each, toward the foreign exchange co8ts; the project would pro- vide a satisfactorybasis for a Bank loan to cover the remaining foreign ex- change costs of US$13.5 million equivalent;an appropriateterm would be 25 years, including a four-yeargrace period. JAMAICA&

APPRAISAL OF A THIRD HIGHWAYPROJECT

1. INTRODUCTION

1.01 The Government of Jamaica has requested the Bank to assist in fi- nancing a project consisting of: (a) the construction,including supervision, of 20 miles of two-lane arterial road and about four miles of main access roads comprisingthe first phase of the arterial road investmentprogram for 1974- 1979; (b) establishmentof permanent vehicleweighing stations and procurement of geotechnicalequipment; and (c) technicalassistance for transportplanning, for aid to the local contractingindustry and for a study of pavement design, evaluation and performance.1/ The total cost of the proposed project is estimatedat about US$23.6 million equivalent. The total foreign cost com- ponent, estimated at US$13.7 million equivalent,would be financedby the proposed US$13.5 million equivalentBank loan and assistancebeing sought from UNDP and the British Government,in the amount of US$0.1 million each; the balance of US$9.9 million equivalentin local costs would be provided by the Government.

1.02 This would be the third highway project financedby the Bank in Jamaica. 2/ The first (Loan 408-JM, US$5.5 million, 1965) was made for de- tailed engineeringand construction,including supervision, of the Kingston- Spanish Town road (15 miles of four-laneroad) and the -CrescentPark road (four miles of two-lane road). Initially, that project also included constructionof the Spanish Town- road (eight miles), but this, with the Bank's approval,was subsequentlydeleted as a result of increased costs. Execution of the projectwas delayed.because of difficultiesin right-of-way acquisition,unsatisfactory performadce of subcontractors,problems in re- location of public utilities and inter-unionlabor disputes,resulting finally in abandonmentof work by the contractorafter 90% completion,the contractor claiming frustrationof contract;his claims have now been settled througn arbitration. The work was satisfactorilycompleted by force account. The loan is fully disbursed.

1.03 The Second Highway Project (para. 1.04) originated from a National Transport Survey which the Governmentmounted in 1968. The consultantsfor that survey, Lamarre Valois International(LVI, Canada),with financingfrom the Canadian International Development Agency (CIDA), were required to (a) establish and analyze costs of transportation by rail, road, coastal shipping

1/ The Government has applied for: (a) UNDP financing for aid to the local contracting industry; and (b) British Government financing for the tech- nical assistance to study pavement design, evaluationand performance. 2/ It would also be the third project ilnthe transportationsector as a whole, since the Bank Group has not financed projects elsewhere in the sector, although an airport project has recently been appraised. -2- and air; (b) examine the capital investmentproposed in each mode over the next 10 years; and (c) project capital and recurrentcosts through 1979, rec- omending appropriatepolicies and measures for the most economical devel- opment of the country's transportationsystem during that period. LVI's report was issued in 1970; the main recommendationsrelating to roads were that: (a) a major resurfacing program of paved roads should be undertaken to prevent further deterioration of pavements and to reduce road-users' operat- ing costs; (b) the structure and procedures of the road maintenanceorganiza- tion should be improved;and (c) early construction/reconstructionof certain high-priorityroads identifiedin the report should be undertaken.

1.04 In 1972, acting ornthe LVI recommendationsrelating specifically to the resurfacingprogram and improvementof maintenance,Government retained the UK consultants T.P.O'Sullivan and Partners (TPOS) to carry out a road maintenance study; the study was partially financed by the United Nations Development Program (UNDP), and the Bank acted as executing agency. The consultants' recommendations formed the basis of the Second Highway Project, the Road Improvement and MaintenanceProject (Loan 899-JM, US$9.3 million in 1973), which comprised: (a) resurfacing of 440 miles of roads with an asphaltic carpet and resealing of 250 miles of roads with a double surface treatment; (b) procurement of maintenance equipment; and (c) technical assistance by consultants to supervise the resurfacing and resealing works, assist in the procurement of maintenance equipment, introduce rational costing and better planning of maintenance operations, and provide training to staff of the Directorate of Maintenance within the Ministry of Works (MOW). The project is progressingsatisfactorily.

1.05 This proposed Third Highway Project also originates from the rec- ommendations of the 1968 National Transport Survey. In 1971, the Governmtent commissioned LVI, again financed by CIDA, to carry out the recommendation relating to high-priority roads, specifically, feasibility studies for about 320 miles of high-priority roads and detailed engineering for 40 miles of secondary main and Parish roads 1/ and 70 miles of arterial roads. The work was completed in March 1974. The arterial road construction in the proposed project is based on this detailed engineering. 2/

1.06 This proposed Third Highway Projectwas appraisedby Messrs. S. Hertel (engineer)and B. Chatelin (economist)in December 1973. The report has been edited by Miss V. Foster.

1/ The administrativeunit of Jamaica is the "Parish" (of which there are 13). The Parish roads are also "public" roads in the normal sense. 2/ Other work recommendedin the National Transport Survey is being financed by other agencies (for example, the Inter-AmericanDevelopment Bank is financing reconstruction of secondary main and Parish roads, and USAID is financing feeder roads). -3-

2. THE TRANSPORT SECTOR

A. The Country and Its Economy

2.01 Jamaica, with an area of 4,410 square miles, is the third largest island of the Caribbean. Its greatest length (east-west)is 146 miles, and its greatest width (north-south)is 51 miles. A mountain ridge up to about 2,500 feet high runs east-west, separating the island into northern and southern coastal areas. The island's natural resources include bauxite and other mineral deposits in various locations in the central area; a pleasant tropical climate and beaches suitable for tourism, primarily along the north coast; fertile soils for agriculture;and fishing and forest reserves. Jamaica's population of about two million has grown in the last ten years at a net annual rate (allowingfor migration) of about 1.5%; its population density, about 420 persons per square mile, is one of the highest among the Latin American and Caribbean countries. Kingston, the capital, situated on the southern coast, is the main market for the country's agriculturalproduce and imported goods. , on the north coast, is the most important tourist resort.

2.02 The per capita GNP of Jamaica was US$720 in 1971. 1/ In real terms, the growth rate of GDP has reached an average of about 5% p.a. over the last five years. The mining sector, which accounted for about 13% of GDP in 1972, and tourism are the most important contributorsto the rapid growth of the economy. Agriculturaloutput has stagnated over the last decade, but the Government expects that, following implementationof a major investmentpro- gram, it will stabilize in coming years at a higher level. Consideringalso the output of substantial investmentsin mining, increasesin industrialization and the projected expansion in tourism, a growth in GDP of 6%-7% p.a. in real terms could be attainable over the next few years. However, the attainment of the rate of growth will depend very largely on Jamaica's ability to over- come its foreign exchange constraints.

2.03 In spite of Jamaica's satisfactorygrowth rate in the past years, unemploymentremains high at about 15% of the labor force. The high level of unemploymentis explained, inter-alia,by the age distributionof the labor force (biased toward the younger age groups), the low rate of growth of the agriculturalsector (the traditionallabor-intensive sector), the high proportion of unskilled labor among the unemployed,and the distorted wage structure due to the very high salaries paid by the bauxite companies.

B. The Transport Modes

(i) General

2.04 Because of Jamaica's relatively small size and the proximity of its population centers, average haulage and travel distances are short. The trans- port requirementsof heavy exports are modest, since these are normally moved by the shortest route to the ports located around the island. Practically

1/ Bank Atlas, 1973 Edition. -4- all bauxite and alumina exports are handled by the public or private railroads, and petroleum products by pipeline; otherwise,roads carry the largest part of freight transport (mainly import products from Kingston to the Taainpopu- lation centers and local agriculturalproduce) and practically all passenger traffic. Basically, the transport system consists of about 9,500 miles of arterial and secondary raain roads (together called "pubiic" roads) 1/ and Parish roads, a 180-mile Government-ownedrailway, a few private railway lines, five airports (two of them international),13 ports, and petroleum pipelines. The system is generally adequate in extent, although deficient in condition and capacity.

(ii) Roads

2.05 Details of the road system and its administrationare given in Chapter 3.

(iii) Railways

2.06 The public railway system is operated by the Jamaican Railway Corpor- ation (JRC). The system consists of a main line running diagonally across the island from Kingston to Montego Bay (112 miles) and a branch line from Spanish Town northward to and then eastward along the coast to (62 miles). The bauxite mining companies own and operate their own railway lines, but they also utilize the public system to the extent that bauxite, aluminum and materials associatedwith that industry represent about 98% of JRC's total freight. This freight traffic has increasedat about 7% per annum during the last five years and is principally carried on the trunk line (Montego Bay-Kingston). This trunk line also carries more than 70% of total rail passenger traffic 2/; the rest of the network has very low density traffic with few possibilitiesfor development.

2.07 The National Transport Survey (para. 1.03) recommended,as first priority, that the public railway's rates and fares should be revised to help solve its deficit position and that uneconomic lines should be abandoned, or, alternatively,that the Government should subsidize the cost of services pro- vided by the railway for social reasons. The Government has since increased its contract rates, and they now cover the capital and operating costs, includ- ing overhead, of moving the mining traffic. In addition, in 1972, the -MayPen line (about 25 miles), one of the uneconomiclines, was closed. M!ost of the relativelysmall loss of JRC (about US$550,000 p.a.) is now incurred on the line to Port Antonio. However, this line serves many poor areas, and the Minister of Public Utilities, Communicationsand Transport is reluctant to deprive them of the service, especially between Bog Walk and AnnottoBay, where the road system is deficient. JRC is currently preparing a five-year rehabilitationprogram and is negotiating technical assistance under bilateral aid from Canada.

1/ See footnote 1/, page 2.

2/ Passenger traffichas increased slightly during the last five years to reach about 40 million pass-miles in 1972. (iv) Air Transport

2.08 Jamaica has two internationalairports, at Kingston and Montego Bay, served by 11 foreign airlines and the national carrier,Air Jamaica. Internal flights between these and three domestic airports at , Port Antonio and Tinson Pen (Kingston) are provided by a local airline, Jamaica Air Services. In addition, there are four small public airportswhich accommodategeneral aviation and over 30 private landing strips owned by the mining and sugar companies. All public airports are operated by the Civil Aviation Department of the Ministry of Public Utilities, Communicationsand Transport, although it is intended that a Jamaica Airports Authority, soon to be created,will operate the two internationalairports. Revenues from landing fees, rentals, concessionsand licenses,but excluding those from the passenger departure tax, rose from US$730,000 in 1962/63 to an estimated US$1.7 million in 1972/73. Operating expendituresincreased during the same period from some US$510p000 to US$1.7 million.

2.09 The sharp increase in tourism in recent years has had a major impact on Jamaica's internationalair traffic. Passenger movements at the inter- national airports increasedbetween 1967 and 1972 at an average of about 12% per annum to about 720,000 passengers per year in Kingston and 907,000 in Montego Bay. Freight movements and general aviation traffic also increased considerably. The sharp traffic increase has led to congestionin aircraft ground operations and traffic handling at both internationalairports. Based on a scheme prepared by Canadian consultants (Kates, Peat, Marwick and Com- pany, and Montreal Engineering)financed by CIDA, the Government requested Bank financing for an airport developmentproject to improve facilitiesat both Montego Bay and Kingston Airports. A loan to help this developmentis being consideredby the Bank.

(v) Ports

2.10 Jamaica has 13 active ports. Two of them, Kingston and Montego Bay, are primarily general cargo ports and handle most of the country'simports; the other 11 are specializedand handle mainly exports. Kingston handles over 80% of the island's imports (4.0 million metric tons total in 1970) and about 7% of its exports (13.0 million metric tons total in 1970). Among the other ports, there are five efficientlyhandling the mining companies'export needs; the largest, Port Rhoades on the north coast, handles five million tons of bauxite annually. The other six ports are used to export agriculturalproducts such as sugar, molasses and bananas, although some agriculturalproducts are also handled through the mining companies'ports. All ports are presently privately owned and operated. However, a strengthened port authority will eventually own all the piers and wharf facilitiesfor all the ports of the island except the five mining ports. As a first stage, the port authority will take over the Kingston port facilitiesand lease or rent them to private companies. The port authoritvwill se responsiblefor tariff policy and will be required to operate on a self-financingbasis. -6-

(vi) Pipelines

2.11 Pipelines owned and operated by the private sector carry fuel from the ESSO refinery in Kingston to various major consumers, to the railway loading station and from some ports to the bauxite mines and aluminum plants.

C. TransportPolicy. Planning and Coordination

2.12 Transport policy is the responsibilityof several Governmentdepart- ments and agencies. The Ministry of Public Utilities,Communications and Transport is responsible for overall policy formulation for aviation, ports and railways, while the MOWis in charge of formulating policies for public roads. Parish roads are under the jurisdictionof Parish Councils which, at the national level, are the responsibility of the Ministry of Local Government. The Ministry of Commerce and Tourism deals with policy formulationon shipping matters.

2.13 Planning of public investments,inicluding investment in the trans- portation sector, has, up to now, been perfcormedby the National Planning Agency (NPA) under the guidance of the National Economic Council, a ministerial body. NPA was establishedin 1972; previously,overall economic planning was carried out by the Ministry of Finance. The National Transport Survey (para. 1.03) is presently used by the various Ministries as a basis for preparing transport investmentprograms. Unfortunately,there is no transporteconomist in Government, and no one is updating the findings of the Survey. This may not be too serious in the very short term since the findings of the Survey, issued about four years ago, are probably still valid. However, they may not remain valid for long as conditions change, and, in view of Government'splans for sizable investmentsin the transportationsector (about US$160 million equivalent 1/ over the next four or five years), a continuousreview of the plans for the sector should be made. This review should preferably be made by Government rather than by consultants,and this need, coupledwith the magnitude of the investment plan, would justify the creation of a capability to analyze and coordinate the modal investmentprograms. During negotiations, the Government informed the Bank that it was in the process of establishing a transport committee in charge of defining and reviewing transportpolicy and investment. The transport committeewould, inter-alia,include represent- atives of the Ministry of Finance; the Ministry of Works; the Ministry of Public Utilities,Communications and Transport; and NPA. This. committeewill be assisted by a special working unit to be located in the Ministry of Works, which already has a traffic unit, comprisingat least one economist/engineer specializingin transport,whom the Governmentagreed, during negotiations, to recruit before June 30, 1975. The negotiating team reviewed, and agreed on, the terms of referenceproposed for technicalassistance to be provided by one or two transportspecialists when the above transport planning unit is set up.

1/ Approximate figures are US$100 million for roads, US$10 million for railways,US$20 million for ports and US$25 million for airports. -7-

2.14 Presently,the users of roads,ports,and airports meet the capital and operatingcosts, including overhead, of these services;some of the rail- way users pay only part of the costs of the servicesthey receive. For high- ways, users are not treatedequally, e.g., dieselfuel is lightlytaxed, gasoline heavily taxed. Government policy on taxation of transport users has not been defined in termsof specificgoals, and availableinformation does not providea basis on which to judge the adequacy of existing taxation policiesin relationto the efficientuse of the transportsystem. However, littlecompetition exists among modes. Each mode is highlyspecialized, and diversion from one to another has occurred only on a small scale.

3. THE HIGHWAY SUBSECTOR

A. The Road Szstem and Road Transport

3.01 The road network of Jamaica is, for the size of the country, rel- atively extensive, totaling about 9,500 miles. Of this mileage, 7,200 miles are suitable for vehicular traffic (about 2,700 miles, 75% paved, of arterial and secondary main roads and 4,500 miles of parish roads); the remaining 2,300 miles are little more than bridle paths. Because of the rugged interior of the country, the road system developed initially in the coastal zone; today, the main road system can be characterizedas a coastal ring road togetherwith three roads crossing the mountainous spine connectingthe northern and southern coasts directly (see Map).

3.02 The road network developed from horse-drawncarriage and bridle roads by gradual improvementand adaptation to the motor vehicle; hence, the geometric standardsare, by modern criteria, only modest. Nevertheless,over much of the network, such standards are adequate for the low traffic volumes, although the pavement structures tend to be in need of resealingor strengthen- ing. The ongoing Road Improvementand MaintenanceProject (para. 1.04) is helping to improve some 690 miles of such roads, the work being largely con- fined to pavement improvement,with only essential improvementof geometrical features. However, for a few arterial roads carrying heavy traffic volumes, the geometric standards and the poor state of the pavements are resulting in dangerous conditions and congestlon. The major element of this proposed proj- ect is directed toward reconstructionof some of the most heavily trafficked sections.

3.03 Road transporthas expanded rapidly In recent years. Traffic counts at about 50 points on the road network, carried out by MOW between 1964 and 1972, indicate that traffic volumes grew at an average rate of 8.5X per annum for the network as a whole, with growth rates on individual roads varying between 4% and 13% per annum. Traffic growtn has been part±cularlyhigh on roads associatedwith bauxite (over 12% per annum) and tourism (over 10Z per annum). These rates of growth are generally consistentwith other road tralaf- indicators,such as the growth of gasoline consumption (about 11% per a-nua between 1964 and 1970) and the growth of the vehicle fleet (the latter increasec. -8 from about 23,000 units in 1955 to 130-000 units in 1972, at an average growth rate of about 11% per annum). Heavy vehicles (about 27,000) account for only about 25% of the total fleet, bui:the fleet appears adequate to satisfy the freight transport demand.

3.04 Road Traffic Regulations lay down permissible axle loadings for pub- lic service vehicles, but only gross vehicle weights for other vehicles. The Regulations,as currently framed, permit gross vehicle weights to exceed the permissiblevalues on the specific authorizationof the Minister responsible for transport and on payment of a special fee which varies with the amount of overload so authorized.

3.05 The shortcomingsof the present Regulationswere discussed at length in April 1973 during negotiationsfor the Road Improvementand Maintenance Project, and satisfactoryassurances were given by Government on necessary action in a number of areas. Progress by the Government in these areas over the past year has been satisfactory;specifically, permits for loads in excess of normal maximum loads are issued on a more restrictivebasis. Furthermore, to grapple with the problems of unauthorized overloading of trucks, the Govern- ment, helped by the consultants (TPOS) retained under the Road Improvementand Maintenance Project, is already carrying out an axle load survey. To put vehicle weight control on a more permanent basis, weighing stations should be set up at key positions on the main roads; to this end, provision and instal- lation of weighing stations is included in this proposed project (para. 4.06).

B. Road Administration: The Ministry of Works

3.06 The planning, constructionand maintenanceof arterial and second- ary main roads are the responsibility of MOW. The technical work of MOWis organized under the Chief Technical Director on a functional basis (see Chart); thus, the Ministry's responsibility for roads is shared among five directorates. The Directorate of Technical Services (DTS) is responsible for survey, design, estimates, specifications, procurementof contractwork above US$11,000 which is financed from budgetary sources, land acquisition, traffic surveys, labora- tory investigationsand research; DTS's staff includes 46 civil engineers. The Directorateof Electrical and Mechanical Services (DEMS) is responsible for electrical installationsin Government buildings and for all vehicles and equipment of MOW; its staff includes 42 mechanical engineers. Specifically, DEMS allocates and controls the funds for the operation, maintenance and re- pairs of all plant and vehicles allocated to the directoratesof MOW. The Directorateof Maintenance (DM) is responsible for maintaining roads, bridges, buildings and drainage channels; its staff includes five civil engineers. The Directorate of Construction (DC) is responsible for execution and administra- tion of all capital projects carried out by MDW and financed from the national budget; its establishmentincludes 10 civil engineers. The Directorate of Major Projects (DMP) administers and controls externally financed construction projects. Its staff includes nine civil engineers. -9-

3.07 The organizational structure of the MDW was overhauled 10 years ago and is generallysatisfactory. The DMP, however, must be significantly strengthenedto provide efficientadministration of the proposed project (para. 4.22).

C. Road Planning and Financing

3.08 The responsibilityfor planning of roads is exercisedmainly by the Chief Technical Director of MOW, assisted,for projects to be externally financed,by DMP. The unit for infrastructureplanning within NPA is respon- sible for reviewing the investmentprograms of NOW and for coordinatingthem with other transportinvestments, but, in fact, the unit does not have the necessary expertisefor analyzing, in depth, proposed Investmentsin the sector (para. 2.13).

3.09 In the past, Governmenthas relied on consultantsto preparehigh- way investmentprograms, first the Transport and Road Research Laboratory (TRRL) in 1962, and, later, LVI in connectionwith the National Transport Survey. The current investmentprograms (1973-1977)comprise about US$33 million for reconstruction and improver.ent of arterial roads, US$21 million for secondary roads, US$15 million for feeder roads, US$11 million for bridges and about US$34 million for other works (Table 1). This program, based mainly on the conclusionsof the National TransportSurvey, appearswell conceived and represents the first phase of a longer-termprogram (1973-1982)designed to provide Jamaica with a road network capable of satisfyingthe road transport demand for the foreseeablefuture.

3.10 As a furthermeasure to strengthenplanning, particularly at the modal level, and in a move tc put modal planning more on a continuingbasis than on the ad-hoc involvement by consultants, MOWhas recently established a traffic unit, and it appears to be working well. This unit should ensure the collection,on a continuingbasis, of the data necessary for rational planning and should provide the stimulus for specific studies which may be required.

3.11 Total expenditure on roads rose from US$10.3 million in 1965/66 to US$26.6 million in 1971/72, but dropped to an estimatedUS$23.7 million in 1972/73 (Table 2). Expenditureon constructionalmost tripledover the period 1965/66-1971/72,increasing from US$5.6 million to US$15.7 million, but dropped sharply in 1972/73 to US$9.4 million because of lack of projects available for construction;in the same period, maintenanceexpenditures increasedfrom US$3.5 million to US$9.1 million. This substantialincrease derived primarily from two factors: a special labor-employmentmaintenance program (a result of Government employmentpolicy) and general cost and salary increases.

3.12 Road expenditures over the period 1965-1973 have been financed mostly (94%) with local funds through budgetary appropriations. External financing (6Z) has been provided by BRD, CIDA, USAID and IDB. Revenues from road users, although not specificallyearnarked for road financing, - 10 - have been consistentlyhigher than total road expenditure (Table 3). The Bank's participation,although small compared with total road expenditure, representedabout two-thirds of external financing during the period.

D. Engineering and Construction

3.13 DTS is responsible for all aspects (survey, site and laboratory investigationand design) of capital projects financed wholly from the budget; the standard and quality of work appear adequate. DMP is responsible for similar services for projects financed externally and has operated through consultants. Since MOWintends that, in the future, DMP shall play an active role in the contract administrationof externally financed constructionworks, it is planned to strengthen its staff significantly. Some strengtheningis necessary in connectionwith the proposed project (para. 4.22).

3.14 Constructionis carried out both by force account and by contract. DC is carrying out earthwork and pavement base constructionby force account (at a cost of about US$2.5 million equivalent per annum), but asphaltic paving and structures are executed by contract. Internationalcompetitive bidding is used for externally financed work; work financed internally is awarded to Jamaican firms either by competitivebidding or by negotiated contract. The local capacity for road works comprises four firms specializingin asphaltic concrete work and about 20 firms undertaking small scale civil works.

3.15 MOW had, for many years, a practice of fragmentingroad construction and improvementwork into small lots; because of this practice, bidding became uneconomicaland, as a result, contractsbelow US$10,000 equivalentwere pro- cured by negotiation. This encouraged developmentof a local small-scale contracting industry, but it had an adverse influence on unit rates, which are much higher than in many other countries. The Government,in connection with the Road Improvement and Maintenance Project, has already begun to phase out the practice of negotiated contracts - apart from petty contracts of less than US$550 equivalent or in excess of this figure in exceptional circumstances - and expects to complete the task within two years of the date of the Loan Agreement, i.e., by June 1975. This change may result in a wider interest by both internationaland local contractors,leading to increased competition and a lowering of rates.

E. Maintenance

3.16 Road maintenance and the organizationresponsible for it (DM) were examined in depth during preparation of the Road Improvementand Maintenance Project (in 1973) and the project was specificallydesigned to improve both the state of maintenancein the field and the structure and procedures of DM. All aspects of the project are being implementedsatisfactorily. - 11 -

4. THE PROJECT

A. Project Description

4.01 The project consists of:

(i) construction,including supervision, of three new arterial road sections (about 16 miles) between Spanish Town and Mandeville,with three major access roads, and the arterial road section (about four miles) from Bog Walk to , with two major accesses;

(ii) construction/improvementsof secondary access roads to the arterial road sections;

(iii) procurementand installationof weigh bridgesfor permanent vehicle weighing stations and procurementof geotechnical equipment; and

(iv) technical assistancefor

(a) transportplanning;

(b) aid to the local construction industry; 1/ and

(c) a study of pavement design, evaluation and performance. 1/

The arterial road element of the project represents the first phase of the arterial road reconstruction program recommended in the findings of the National Transport Survey (para. 1.03). Detailed engineering has been carried out by LVI with financing by CIDA. Government may request Bank financing for the second phase, due to be completed by 1979.

(i) Construction of Arterial Road Sections

Spanish Town-Mandeville

4.02 The existing road from Spanish Town to Mandeville (48 miles) is, apart from two short reconstructedand realignedsections, winding and narroas; it has a 20-foot pavementwith shoulders of varying width and passes through numerous towns and villages. The pavement of asphalticconcrete is deteriorat- ing. Average speeds are currently25-30 m.p.h. for cars and 20 m.p.h. for trucks. Current traffic volume is in excess of 5,000 vehicles per day.

1/ The Governmentis seeking financingfrom UNDP for the technicalassistance for aid to the local constructionindustry, and from the British Govern- ment for the study of pavement design, evaluationand performance. - 12 -

4.03 The project works would be concentrated on three sections - Bypass I, May Pen Bypass II, and Williamsfield-Greenvale - and would provide a fully engineered two-lane arterial road in these sections, with an additional (climbing) lane on sustained gradients of 8Z. Design standards were agreed during negotiations and are indicated in Table 4. The works include three major access roads - two to May Pen and one to Mandeville. The project work would involve heavy earthwork and rock excavation, and the pavement would com- prise a crushed rock base and an asphaltic concrete carpet. Labor-intensive methods are not suited to this type of construction; hence, the design has been based on normal equipment usage. Nevertheless, the labor component is estimated at 25%, and, in specific terms, work on these sections should pro- vide employment for about 700-800 workers over the construction period.

Bog Walk-Linstead

4.04 The existing 4.5-mile road from Bog Walk to Linstead is part of the arterial road from Spanish Town to the north coast at Ocho Rios. Another part of this arterial road, the Moneague-Crescent Park section, was reconstructed by force account under the first Bank highway project. The remaining sections are scheduled for improvement in the Government's 1979-1983 five-year program. The existing Bog Walk-Linstead road is narrow and winding and passes through the villages of Bog Walk and Linstead; its pavement is in fair condition only, and the average vehicle speed is 20-30 m.p.h. The current traffic volume exceeds 5,000 vehicles per day. The nature of the proposed construction would be similar to that for the Spanish Town-Mandeville Road (para. 4.03). One major access to each of the towns of Bog Walk and Linstead is included in the project.

(ii) Construction/Improvement of Secondary Access Roads

4.05 Sections of a number of existing secondary access roads will need to be improved or reconstructed, particularly where they join the arterial roads. Agreement on the sections to be improved was reached during negotiations. It is proposed that construction of the junctions with the arterial roads be included in the arterial road works, while the remaining improvements will be undertaken by MOW and financed from budgetary funds.

(iii) Establishment of Permanent Vehicle Weighing Stations and Procurement of Geotechnical Equipment

4.06 The construction of new sections of arterial roads will give Govern- ment the opportunity to address itself to the problem of unauthorized over- loading of vehicles, specifically by enabling it to plan for a rational loca- tion of permanentweighing stations. Under the proposed project, five such stations would be provided. During negotiations,it was agreed that one weighing station would be located on each of the sections of May Pen Bypass, Williamsfield-Greenvaleand Bog Walk-Linstead;determination of location for the remaining two weighing stations will await the results of the axle load- ing survey being carried out under the Second Highway Project. Geotechnical testing equipment is for testing and research work in connection with road constructionand maintenance. - 13 -

(iv) Technical Assistance

4.37 The project would provide technicalassistance in three areas: transportplanning, aid to the local constructionindustry, and pavement design. To develop a capability for transportplanning, technical assistance would be provided to MOW. This assistancewould help in analyzing and re- viewiilgthe large transportinvestment program forecast for the next five years and define priorities. It would also (a) define the minimum transport data required for transportplanning and the appropriatechannel to collect them; (b) prepare methodologiesfor transport cost computationand feasibility studies; and (c) advise on transport coordination. Some 25 man-months of consultingservices are envisaged for assistance in this area.

4.08 The local contractingindustry is relativelystrong in one type of work - the production and laying of asphaltic concrete -- but is otherwise weak and small scale. This may be due, in part, to Government'spolicy of fragmentingwork to the point that it was inappropriateto bid it (hence, negotiated contractswere resorted to). Under the Road Improvementand MaintenanceProject, Government agreed to phase out the practice of negotiated contracts (para. 3.15), and the consequentreturn to competitivebidding should help to "sharpen" the contracting industry.

4.09 The measure outlined in the preceding paragraphshould help provide an appropriateenvironment in which the local contractingindustry may de- velop. In addition, the Government is now undertakinga substantiallyex- panded road investment program, and this will provide a stimulus to the local contractingindustry. To help it develop, technical assistancewould be pro- vided, under the proposed project, by experts working with the contractors' associationsand with individual firms in the fields of (a) work planning, site management, equipment usage and personnel training; and (b) costing and bid preparation. About 25 man-months of consulting services are envisaged for this assistance.

4.10 Jamaica is currently in the position of having a relatively ex- tensive paved road network but little informationon the long-termperform- ance of its pavements under traffic. Design to date has tended to be based on experience in countries where long-term behavior data are available, e.g., the UK, but it is not proven that the data are relevant to Jamaican condi- tions. A research program is needed, and a modest provision of technical assistance is therefore included in the proposed project.

4.11 During negotiations,the terms of reference for retaining consultants to provide technical assistance for transportplanning (para. 4.07) were agreed. During negotiations, draft terms of reference for retaining consultantsfor aid to the local contractingindustry were discussed, and Government will use these as a basis for final arrangements for UNDP financing. Terms of reference for the technical assistance for pavement design, evaluation and performance will be agreed between the Transport and Road Research Laboratory (TRRL) and the Government. - 14 -

B. Cost Estimate, Financingand Disbursements

4.12 The total cost of the project is estimatedat US$23.6 million equivalentwith a foreign exchange componentof US$13.7 million equivalent. A summary of cost follows; details are given in Table 5.

Foreign Exchange J$ Million US$ M4illion Component Local Foreign Total Local Foreign Total % Part I: Items to be financed with Bank assistance

(i) Clivil works /1 6.65 9.30 15.95 7.35 10.24 17.59 58 (ii) Supervisionof (i) 0.70 0.90 1.60 0.77 1.00 1.77 57 (iii) Weighing stations and geotechnical equipment 0.10 0.19 0.29 0.11 0.21 0.32 65 (iv) Technical assistance 0.10 0.10 0.20 0.11 0.11 0.22 50 (v) Contingencies - physical 0.44 0.55 0.99 0.48 0.60 1.08 -price 0.88 1.21 2.09 0.97 1.34 2.31 TOTAL 8.87 12.25 21.12 9.79 13.50 23.29 58

Part II: Items to be financedwith UNDP and British Government assistance

Technical Assistance 0.10 0.20 0.30 0.11 0.22 0.33

TOTAL PROJECT COSTS 8.97 12.45 21.42 9.90 13.72 23.62

/1 Excludingland aquisition costs estimated at US$2.6 million.

4.13 Constructioncosts have been based on the estimates of LVI, pre- pared as a result of detailed engineering (1973), and have been increased to include estimatedprice escalationup to bidding (bids are expected to be opened in the Fall of 1974). Estimates assume that arterial road construc- tion would be carried out by foreign contractors, 1/ with the exception of earthworks and pavement base works on the Bog Walk-Linstead Section and accesses thereto, which would be carried out by force account (para. 4.21). The average construction cost for all road sections in the project is US$0.7 million per mile, excluding land acquisition, supervision and contingencies;

1/ The local contracting industry may be expected to be fully occupied with resurfacing and overlaying under Bank Loan 899-JM, feeder road construc- tion financed by USAID and reconstruction works of secondary main roads financed by IDB. - 15 - including these, the cost is US$1.0 million per mile. This high cost is due to (a) difficult terrain to be covered,high labor costs in Jamaica, and the need for eight railroad separations and two miles of climbing lanes; and (b) the risk factor arising from recent experience of labor unrest in Jamaica. For the works on force account, the consultants' estimates have been reduced by 15% to reflect the lower cost of construction on an assured and continuous basis (MoW has been handling similar works competently over many years). Additionally,in Jamaica, the pr;cing of force account work could be expected to be less than for the same work performed by contractors,since the latter would normally cover (and the Government would, therefore, pay for) all potential risks, whereas, with force account working, Government would pay only if the risks materialized. Costs of recently completedworks by force account validate this reduction.

4.14 Costs for consultingservices for supervision,estimated at about US$60,000 per man-year, are based on current costs for similar services by foreign consulting firms working under comparable circumstances. On the other hand, the costs for technicalassistance are based on the assumption that this assistance would be provided by individual foreign consultants and at current rates for such assistance in Jamaica. The costs of local counterparts have been included in the project.

4.15 A contingencyallowance of 6% of constructioncosts has been included to allow for increases in quantities;this is considered adequate in view of the detailed engineeringcarried out. Price contingenciesare partly incorporated in the base cost, as will be the case with contractors'bids. The total costs, including the price contingencies,are based on the assumption of about a 12% yearly increase in constructioncosts over the constructionperiod.

4.16 The foreign exchange component for constructionworks on contract is estimated at 60% of total constructioncost, excluding the cost of land acquisition;including land acquisitioncost, the foreign exchange component is 52%. The correspondingfigures for force account works are 50% and 45%. For the civil works as a whole, the average foreign exchange component is 58%, excluding land acquisition.

4.17 The proposed loan would finance all foreign exchange costs of the project except those financed by UNDP and the British Government. Local costs would be met by Government from budgetary allocations.

4.18 Disbursementsfrom the loan would be made on the following basis:

(a) for civil works on contract, 60% of constructioncosts;

(b) for civil works on force account, 50% of certified cost;

(c) for provision and installationof weigh bridges for permanent vehicle weighing stations and procurementof geotechnical equipment, 100% of the foreign exchange cost;

(d) for consultingservices, 100% of the foreign exchange cost. - 16 -

The procedures for determining the costs of civil works undertaken by force account are being developed by MOWw;Lth the assistance of consultants retained under the Second Highway Project. During negotiations,these procedures were discussed in outline and they will subsequently be agreed in detail with the Bank.

4.19 Based on the foregoing, and on implementation commencing late 1974, an estimated schedule of loan disbursement has been prepared (Table 6). Surplus funds remaining in the loan account on completion of the project should be cancelled.

C. Execution

4.20 Execution of the project would be the responsibilityof MOW. Contracts for civil works (excludingearthworks and pavement for the Bog Walk-Linstead section and its two main access roads, but including all asphaltic surfacing) and for supply and installationof weigh bridges would be procured by inter- national competitivebidding in accordancewith the Bank's Guidelines. Geo- technical equipmentestimated to cost up to US$50,000in the aggregatewould be procured by negotiated contract. The constructionwork subject to bidding would consist of five contracts, and bidders would have the opportunityto bid for one or several contracts, accordingto their capacity.

4.21 In accordancewith MOW's request, earthworksand pavement (exclud- ing asphaltic surfacing) for the Bog Walk-LinsteadSection includingaccesses theretowould be carried out by force account. MOW already has a force account constructioncapability 1/ and wishes to retain it;

(a) To deal promptlywith emergency situations (e.g., hurricane damage) since the local contractingindustry is currently too small to cope with such situations;

(b) As a means of determiningthe true cost of performing various construction operations (MOWis not convincedthat bidding, either internationalor domestic, is currentlyleading to realistic prices and is confidentthat limited force account work would prove to be cheaper than contractwork);

(c) To have a restrainingeffect on unit prices of contract work.

MOW believes that its force account constructionunit would benefit from the discipline of a Bank-financedproject, and from being subjected to the same quality of supervisionas would be applied to the remainder of the civil works in the project. At the same time that the Government wishes to main- tain, and to make more efficient, its force account unit, it wishes to develop the local contractingindustry to meet the increasingdemand for civil works construction. This policy, to which the present policy conforms, was reaffirmed during negotiations.

1/ The force account constructionunit performedvery satisfactorily under the First Highway Project, Loan 408-JM (para. 1.02). 4.22 Supervisionof the civilworks would be carriedout joinmfly by MOW (through DMP) and foreign consultants. MOW does not wisn to retain LVI for this work; new foreign consultantswould thereforebe selected. The number and qualificationsof MOW staff in the supervisoryteam, the condi- tions and terms of reference for the foreign consultants, and the nature of the working arrangements between MOWand the consultants wereagreed with the Government during negotiations.

4.23 To carry out the technical assistance,consultants accepable co the Bank would be appointed on terms and conditionssatisfactory to the Bank. For assistance in transportationplanning and to the local contractingin- dustry, individual consultantswould be provided over about a two-year period. For assistancewith pavement evaluation,MOW has approached the TRRL.

5. ECONOMIC EVALUATION

A. General

5.01 The economic evaluation concentrateson the arterial road construc- tion program (which would represent about 90% of the estimated project cost, with an economic return on the investment of about 20%). A qualitative assessment only is made of the proposed investmentin technicalassistance.

B. Arterial Road ConstructionProgram

5.02 Except for a few miles of road recently built or improved, the geometric characteristicsof are poor and paving is poor/ fair. A large part of the network with relatively light traffic (less than 2,000 vehicles per day) may easily be improved with better maintenance and with either an asphaltic overlay or asphaltic surface dressing; this treatment of relatively lightly trafficked roads is being carried out under the Road Improvementand Maintenance Project. For the arterial roads, how- ever, with heavier traffic (4,000-6,000vehicles per day), such a treatment is not appropriate, and the proposed project therefore concentrates on re- construction of the arterial road sections.

5.03 The proposed project includes financing of constructionof the first phase of the 1974-1979arterial road constructionprogram. The se- lected roads have a daily traffic of 4,000-6,000vehicles and their improve- ment is urgently needed. Three of the four proposed road sections (May Pen Bypass I and II and Williamsfield-Greenvale) are part of the Spanish Town- Mandeville road; Bog Walk-Linstead is part of the highway from Spanish Town to the north coast.

5.04 The Spanish Town-Mandeville road links Spanish Town (48,000 in- habitants), May Pen (32,000 inhabitants), Old Harbor (7,000 inhabitants) and Mandeville (13,000 inhabitants). The total population of the direct zone of influence has increased rapidly during the last years to reach about 185,000 - is -

inhabitantsin 1972. An objective of the Governmentpolicy is to favor the industrializationof this region,which has excellent prospects for future economic development,in order to slow down the rapid growth of the Kingston area. Large sugar fields and sugar factories are located in the south. Bernard Lodge, south ot Spanish Town, Innswood Estate, a few miles west of the same city, and the Monymusk sugar factory south of May Pen are important sugar processing areas with an expected productionof 230,000 tons of sugar by 1980. The mining center of Lionel Town, south of May Pen, is developing rapidly, helped by the alumina industry and a canning plant. The land is suitable for agricultural production and has very good potential for citzs 4 fruit, bananas and corn, production of which is expected to reach 75,000 tons, 25,000 tons and 10,000 tons p.a., respectively, by 1980.

5.05 The highway from Spanish Town to the north coast serves some 165,000 people, gives access to , the first and largest mining center of the country, and carries an increasingamount of tourist traffic between Montego Bay and Kingston. The area along the Bog Walk-Linsteadsection produces mainly sugar, citrus fruit, bananas and milk products, which are shipped to Kingston for export or local consumption.

5.06 Currently, the Spanish Town-Mandevilleroad carries about 4,000 v.p.d. near Mandeville and about 7,000 v.p.d. near Spanish Town. On the Bog Walk- Linstead section, the present traffic is about 5,000 v.p.d. On each section of the proposed project, traffic growth has been between 7% and 9% during the past ten years. A similar rate of growth can be expected. Nevertheless, the present energy crisis may slow down high traffic growth. Therefore, more conservative growth rates have been adopted for the purposes of this evalua- tion as follows:

Average Yearly Increase for 1972 all Vehicles over the 20-year ADT Assumed Economic Life

May Pen Bypass 4,730 4.0% Williamsfield-Greenvale 4,140 4.4% Bog Walk-Linstead 5,470 5.4Z

Detailed traffic forecastsper section and type of vehicle are given in Table 7.

5.07 On the existing road sections to be rebuilt or improved in the proposed project, the average speed is low (between 20 and 30 m.p.h.) due to the very poor design characteristics,damaged paving and n?mierouscross- ings through the centers of small towns or villages. The new alignments, with a design speed of 50 to 60 m.p.h., would substantially reduce the vehicle operating costs. - 19 -

5.08 For the purpose of this economic evaluation,benefits have bee limited to savings in vehicle operating costs. However, the reconstruction of the arterial sections would have, in addition, an important social func- tion. Currently,all the sections run through the center of the towns and villages, creating considerable nuisance and danger for the inhabitants; the proposed reconstruction, by avoiding these heavily built-up areas, would reduce air pollution,noise level and number of accidents. These unquantifi- able but, nevertheless,real "social" benefits would accrue directly to the inhabitants along the route. The savings in vehicle operating costs would accrue initially to the operators, and, because of competition in the industry, would be passed on, in part at least, to the shippers and, ultimately, to the general public.

5.09 Considering only operating cost savings (Table 8), the economic return on the proposed investment in each of the arterial sections is as follows:

May Pen Bypass 24% Williamsfield-Greenvale 17% Bog Walk-Linstead 17%

The return for the sections taken together is about 20%. A sensitivity analysis of the effect of a constructioncost increase indicates that, even with a 15% cost increase, the arterial road reconstructionwould still be feasible (Table 9). Traffic growth rates have alreadybeen estimated con- servatively (para. 5.06); hence, the sensitivityof the economic return to further reduction in the growth was not considered.1/

C. Technical Assistance

5.10 The technicalassistance for transportplanning should help ensure that future investmentin the sector would maximize socio-economicbenefits. In addition, the counterpartsmay, in future years, advise planning officials concernedwith other sectors of the economy on the principles of project identification and evaluation. In quantitativeterms, the total cost of the technical assistance proposed for planning would represent only about one- thousandthof the investmentproposed in the sector over the next four or five years (para. 2.13).

5.11 The technical assistanceto local contractorsshould improve the entrepreneurialand engineeringcapabilities of the industry. This, in turn, should lead to better quality of work, more competitivepricing than pre- viously, and a savings in foreign exchange as local contractorsreplace ex- patriate firms.

1/ The Bank model was used for calculatingthe economic return. In the present case, this leads to a conservativeestimate of benefits since it does not take into account: (a) benefits deriving from reductionin rise and fall of road; (b) benefits from introduction of climbing lanes; and (c) the full benefit from decongestion. - 20 -

5.12 The current "replacement" value of the pavements in Jamaica's road system may be estimated at between US$50 million and US$100 million. Pavement design, particularlywith referenceto the strengtheningof exist- ing pavements, is developingscientifically in many countries,but an essen- tial element of the design is a knowledge of pavement behavior and the local climatic, soil and traffic conditions. Such behavioralinformation has been gathered over the past decade or so, particularly in the US and Europe. In Jamaica, a start has been made on the determinationof pavement conditions under the Road Improvement and Maintenance Project, specifically for deter- mining the thickness of asphaltic concrete overlays. However, in the long term, to determine how the considerable investment may be preserved and how pavements may be strengthened economically to cope with the requirements of traffic, a research program tailored to Jamaican conditions is needed. The technical assistance proposed in this area should enable the program to be properly structured and should provide instruction for counterpart personnel during the formative stages.

6. AGREMENTSREACHED AND RECOMNDATION

6.01 During negotiations,assurances were obtained from Governmenton the following:

(a) developmentof a transportplanning capability to analyze and coordinate the modal investmentprograms (para. 2.13); and

(b) provisionof adequate secondary road access to the proposed reconstructedarterial sections (para. 4.05).

6.02 During negotiations, agreement was reachedwith Governmenton the following:

(a) extent of the expertise to be provided for the transport planning capabilityand recruitmentof at least one economist/ engineer specializing in transport before June 30, 1974 (paras.2.13 and 6.01 (a));

(b) design standards for the arterial roads (para. 4.03);

(c) details of adequate secondary road access to the proposed reconstructedarterial sections (para. 4.05);

(d) location of the permanentvehicle weighing stations (para. 4.06);

(e) terms of referencefor retainingconsultants providing technical assistance for the transport planning (para. 4.11); - 21 -

(f) the basis for costing force account work, the details of which will be agreed with the Bank later (para. 4.18); and

(g) the number and qualificationsof MOW staff to be provided for the civil works supervisory team, the terms of refer- ence and conditions under which foreign consultants would be retained for the supervision, and the nature of the working arrangements between the consultants and MOW (para. 4.22).

6.03 With the assurances indicated in paragraph 6.01 and the agreements indicatedin paragraph 6.02, the project would provide a suitable basis for a loan of US$13.5 million equivalentfor a period of 25 years, including a four-yeargrace period.

June 24, 1974

TABLE 1

JAMAICA

THIRDHIGHWAY PROJECT Road Investment Program (US$ million)

1973/74 1974/75 1975/76 1976/177 1977/78 TOTAL

Rural Feeder Roads 4/4.3 5.2 5.8 0.3 - 15.6 Bridge Pogram g/ 2.4 3.6 2.5 1.7 0.7 10.9 Secondary Parish IDad I/ - 4.4 5.9 6.3 4.1 20,7 Arterial Roads v/ 0.4i 4.1 9.1 12.3 f.5 33.4 Other Works i/ 12.0 1A44.44 5 34 ° 19.1 25.0 27.7 25.0 17.8 114.6 Local Finaning 15.5 16.3 15.8 14.9 11.7 74.2 Foreign Financing 3.6 8.7 11.9 10.1 6.1 40.4

2/ 60% financed by USAID #/ 36% financed by the Canadian Government ]/ 50% financed by IB 50% finanted by IBRD MOWand Mission estimates

Source: MOW

January1974 JAMAICA

THIRD HIGHWAY PROJECT

jjpenditureon Roads, 1965-1973

(In US$ millions)

Financing Jamaica Fiscal Year Construction Maintenance Administration TOTAL Foreign 17 Local

1965-1966 5.6 3.5 1.2 10.3 - 10.3 1966-1967 6.6 4.5 1.2 12.3 0.1 12.2 1967-1968 7.8 4.4 1.6 13.8 o.4 13.4 1968-1969 8.6 4.2 1.4 14.2 0.8 13.4 1969-1970 9.9 4.6 1.7 16.2 0.5 15.7 1970-1971 14.0 5.4 1.7 21.1 2.0 19.1 1971-1972 15.7 6.7 4.2 26.6 2.4 24.2 1972-1973 9.4 9.1 5.2 23.7 2.7 21.0

Including expenditureson all arterial, secondarymain and parish roads.

21 Including financing from IBRD (Loan 408-JM) CIDA (on-goingJamaica TransportationSurvey and bridge rehabilitation program), USAID (on-going Rural Roads Program), and IDB (reconstruction of secondary, main and parish roads).

Source: Ministry of Works, Consultantsand Mission Estimates. December 1973

January1974 JAMAICA

THIRD HIGHWAYPROJECT

Road User Charges

(In US$ millions)

Exciseduty on Importduties on Customsduties Exciseduty Licenceduty on Road traffic FiscalYear tubes and tires road motor vehicles on gasoline on gasoline notor vehicles licenseduty TOTAL 1957-1968 0.1 5.8 0.3 6.8 0.1 4.7 17.8

1968-1969 0.5 6.3 1.0 7.6 0.1 5.2 20.7 1969-1970 0.6 5,1 - 9.4 0.1 6.2 21.4 1970-1971 0.7 10.3 10.4 0.2 6.5 28.1 1971-1972 0.9 12.4 12.6 0.2 7.7 33.8

Source: Ministry of Finance December1973

January1974 TABLE 4

JAMAICA

THIRD HIGHWAYPROJECT

Design Standards for Arterial Roads

/1 Type of Terrain Flat Design Element Rolling Hilly Mountainous

Design speed mph 60 50 40

Minimum passing sight distance ft 2100 1800 1500

Minimum horizontal radius ft 1040 700 430

Maximum grade % 6 8 9

Pavement width ft 24 24 24

Shoulder width ft 8 6 4

j/' These standards have been generally applied, but have been varied in specific locations where their rigid application would be uneconomic.

Sources: MDW and LVI

March 1974- JAMAICA

THIRD HIGHWAY PROJECT

Cost Estimate

% Foreign J$ Millions US$ Millions Equivalent Exchange Local Foreign Total Local Foreign Total Component

Part I: Items to be financed by the Bank 17 A. Civil Works (Excluding land acquisition)

(i) May Pen Bypass I 1.55 2.35 3.90 1.70 2.60 4.30 60 (ii) May Pen Bypass II 1.45 2.15 3.60 1.60 2.34 3.94 60 (iii) Williamsfield-Greenvale 1.80 ?.85 4.65 2.00 3.15 5.15 60 (iv) Bog Walk-Linstead 1.85 1.95 3.80 2.05 2.15 4.20 52 Sub-Total (A) 6.65 9.30 15.95 7.35 10.214 17.9

B. Establishmentof Weighing Stations and Procurement of GeotechnicalEquipment 0.10 0.19 0.29 0.11 0.21 0.32 66

C. Consulting Services

(i) Supervisionof constructionof works under A 0.70 0.90 1.60 0.77 1.00 1.77 57 (ii) TechnicalAssistance to Government for transportplanning 0.10 0.10 0.20 0.11 0.11 0.22 50 -Sub-Total(C) 0.80 1.00 1.80 WBd 1.11 1.99 56

D. Contingencies

(i) Physical 6% of A 0.44 0.55 0.99 0.48 0.60 1.08 (ii) Price 0.88 1.21 2.09 0.97 1.34 2.31 Sub-Total (D) 1.32 1T76 3.08 717- 1.914 3.39

Total of items to be financed by Bank 8.87 12.25 21.12 9.79 13.50 23.29

Part II: Items to be financed by UNDP and British Gov.

E. TechnicalAssistance for Help to Local Contracting Industry (financedby UNDP) - 0.10 0.10 - 0.11 0.11

F. Technical Assistancefor Pavement Design, Evaluation and Ferformance (financedbY british uovernment 0.10 0.10 0.20 0.11 0.11 0.22

Total of items to be financed by UNDP and _B_ Briti Government _ ___ 0.10- Q02.0 OO_-O0_1- --a-

Total Project Costs 214 9.90 .2

1/ Estimatesbased on expected Fall 1974 prices, when bidding is likely to take place.

SOURCE: Mission-Estimates

May 1974 TABLE6

JAMAICA

TBIRD HIGHWAYPROJECT

Schedule of Disbursements

IBRD Fiscal Year and Cumulative Disbursement at Quarter Ending_ End of Quarter

1974/75

September30, 1974 20 December 31, 1974 50 March 31, 1975 400 June 30, 1975 1,100 1975/76

September30, 1975 2,000 December 31, 1975 3,200 March 31, 1976 9,600 June 30, 1976 6,200 1976/77

September 30, 1976 7,700 December 31, 1976 9,300 March 31, 1977 10,800 June 30, 1977 12,000 1977/78

September30, 1977 13,200 December 31, 1977 13,500

Assumptions:

Call for Bids August, 1974 Bids Evaluated October, 1974 Award of Contracts November, 1974 Startof Construction January, 1975 CompletionContracts June, 1977

Sources: MOW and Appraisal Mission May 1974 TABLE7

JAMAICA

THIRD HIGHWAYPROJECT

Traffic Forecast

1972 1979 1985 1995 Average Year Increase

May Pen Bypass

Cars 2,730 3,765 4,960 7,850 4.7% Vans 1,206 1,445 1,685 2,175 2 6f Buses 86 105 120 155 2.6 Light Trucks 602 670 735 850 1.8% Heavy Trucks 106 175 270 550 7.4%

TOTAL 4,730 6,16770 11,580 4.0%

Williamsfield-Greenvale

Care 3,140 4,360 5,775 9,230 4.8% Vans 650 760 875 1,100 2.3% Buses 40 50 55 70 2.5% Light Trucks 264 285 310 350 1.2% Heavy Trucks 48 80 120 250 7.4%

TOTAL 4,142 5 535 7,135 11,000 4.4%

Bog Walk-Linstead

Cars 3,850 6,045 8,010 14,100 5.8% Vans 890 1,215 1,480 2,195 4.0% Buses 62 85 100 150 3.9%f Light Trucks 568 750 890 1,250 3.5% Heavy Trucks 66 130 195 450 8.7% TOTAL 5 436 8,225 10 675 18_145 5.4%

Source: MOW

January 1974 TABLE 8

JAMAICA

THIRD HIGHWAYPROJECT

Vehicle Operating Costs

Old Road New Road Speed UST per veh/mi Speed US$ per veh/mi

Cars 25 mph 0.338 45 mph 0.275

Vans 25 mph 0473 45 mph 0.383

Buses 25 mph 1.239 35 mph 1.032

Light Trucks 25 mph 0.701 35 mph 0.563

Heavy Trucks 25 mph 1.019 35 mph 0.877

Sources: MOW, LVI

January 1974 TABLE9

JAMAICA

THIRD HIGHWAYPROJECT

Economic Return

(SensitivityAnalysis)

1=5%Construction Road Section Best Estimate Cost Overrun

May Pen Bypass 23.7% 19.8%

Williamsfield- Greenvale 16.8% 13.8%

Bog Walk - Linstead 17.0% 13.9%

NOTE: No decreases in bene±'its have been assumed since these are estimated conservatively (para. 5.06)

Source: Mission Estimate

January1974

JAMAICA

THIRD HIGHWAYPROJECT

Structure of the Ministry of Works

| Minster of Works

ParliamerntarySecretary

| Permanent Secretary |

Assistant Under Secretary Chief Technical DirectoAssistant Under Secretary Assistant Under Secretary Administration Personnel Finance

Director of Technical Director of Electrical Director of Maintenance Directo of of jor Services and Mechanical Services Construction rvicea. ad_ . . roet

ArchitecturalBranch Workshoos Branch Six Field Area Branches Buildings Branch Planning Section (roads and buildings)

Lands and Survey Branch ElectricalInstallations Kingston and St. Andrew Road Construction Major Projects in Buildings Branch Corporate Area (buildings) Branch Section

Quantity Surveying and Equinment Pool Contracts Branch

Civil Engineering Branch

Source: TPOS Road Maintenance Study 1972

March 1974

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DOD ROADS00 RE IMPROVED~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~------RE1~ .,

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COUNTOBOUNDARIESG) EA

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-- RCUNVERS N7AI 7300n;4 iTHIRD HiGHWAY0 :PfrOJECT73