Technical Assistance TAR: PRC 37603 Technical Assistance to the People’s Republic of China for Preparing the Nanjing Qinhuai River Environmental Improvement Project July 2005 CURRENCY EQUIVALENTS (as of 15 June 2005) Currency Unit – yuan (CNY) CNY1.00 = $0.121 $1.00 = CNY8.2766 ABBREVIATIONS ADB – Asian Development Bank DI – design institute EIA – environmental impact assessment FS – feasibility study IA – implementing agency NMCC – Nanjing Municipal Construction Commission NMDRC – Nanjing Municipal Development and Reform Commission NMEPB – Nanjing Municipal Environmental Protection Bureau NMFB – Nanjing Municipal Finanance Bureau NMG – Nanjing Municipal Government NMPUB – Nanjing Municipal Utilities Bureau NQREIP – Nanjing Qinhuai River Environmental Improvement Project PMO – project management office PPMS – project performance monitoring system PRC – People’s Republic of China RP – resettlement plan TA – technical Assistance t/d – tons per day TOR – terms of reference WWTP – wastewater treatment plant TECHNICAL ASSISTANCE CLASSIFICATION Targeting Classification – General intervention Sector – Multisector: Water supply, sanitation, and waste management; agriculture and natural resources Subsectors – Waste management, integrated; water resource management Themes – Environmental sustainability, sustainable economic growth Subthemes – Urban environmental improvement, institutional development NOTE In this report, "$" refers to US dollars. This report was prepared by L. Sabyrova (team leader) and S. Wermert. o o 118 00’E 121 00’E S H A N D O N G Ganyu Feng Xian Lianyungang NANJING QINHUAI RIVER Pei Xian Lianyungang ENVIRONMENTAL IMPROVEMENT PROJECT IN THE Chia Wang PEOPLE'S REPUBLIC OF CHINA Xinyi HENAN Guanyun Pei Xian Xuzhou Xiangshui Shuyang o o 34 00’N 34 00’N Binhai Suqian Funing Siyang Sheyang Huaiyin A N H U I Qingjiang Sihong Jianhu Huai’an Longse Yancheng Hongze Lake Baoying Dafeng Y e l l o w S e a Xuyi Xinghua Dongtai Gaoyu Lake Gaoyou J I A N G S U Tai Xian Hai’an Taizhou Jiangdu Luhe Yangzhou Rugoo Rudong N Yang Jiangpu Zhenjiang Nantong NANJING Jingjiang o Daiyang tze Nantong o River 32 00’N 32 00’N Hainen Jiangyin Jurong 0 20 40 60 80 Jiangning Zhangjiagang Qidong Changzhou Kilometers PROJECT AREA Jintan Changsu Lishui Yangtze River Wuxi Provincial Capital A N H U I Taicang City/Town Liyang Kunshan Yixing River Gaochun Suzhou Provincial Boundary Tai Lake Boundaries are not necessarily authoritative. Wujiang SHANGHAI 05-3295 HR o Z H E J I A N G o 118 00’E 121 00’E I. INTRODUCTION 1. During the review and update of the country strategy and program for the People’s Republic of China (PRC)1 in October 2004, the Government requested the Asian Development Bank (ADB) to include the Nanjing Qinhuai River Environmental Improvement Project (NQREIP)2 into the lending program, and to provide project preparatory technical assistance (TA) for the NQREIP.3 A Reconnaissance Mission was conducted in March 2005, and a Fact-Finding Mission was fielded in May 2005. The Mission had discussions with key stakeholders and reached an understanding with the Nanjing municipal government (NMG) and concerned central and provincial authorities on the proposed Project’s objectives and scope, and the objectives, outputs, cost estimates, financing plan, and implementation arrangements for the TA.4 II. ISSUES 2. Nanjing is located on the lower reaches of the Changjiang (Yangtze) River and is the capital of Jiangsu Province. It is an important transportation hub and, due to the city’s long and distinguished history (being the ancient capital of 10 dynasties spanning 450 years), is a cultural center in eastern PRC. Nanjing is a rapidly developing city with a total population of about 6.5 million, of whom 4.5 million comprise the urban population. Official data record about 27% of the population as agriculture-based in 2003 compared with over 50% in 1990, indicating a sizable movement of the population to urban areas. Nanjing comprises 11 districts and 2 counties. Eight of the districts now form what is considered the main urban area. The three outlying districts were formerly counties that have been upgraded to urban district status in light of recent urbanization and future development plans. As in many large PRC cities, rapid economic growth over the past 20 years has placed increased stress on the environment and city infrastructure. High population density in the main downtown area has been a constraint to improved livelihood. The current treatment rate of wastewater generated in Nanjing is approximately 66%. 3. Qinhuai River, referred to as the “mother river” of Nanjing, flows through the urban area before it joins the Yangtze River. It has a total reach of 110 kilometers (km), with the lower 34 km passing through the city’s main urban districts, and has many tributaries. The official water quality target for the lower Qinhuai River is class V, but currently the river fails to achieve that target by a significant margin. The high intensity of rainfall has historically caused localized urban flooding in some areas of the city, while the flat topography and lack of natural flow in local watercourses result in stagnant water and the associated health and sanitation problems during the dry periods. The urban poor, including those among the floating population and new migrants, suffer most from the existing problems of water pollution and flooding. 4. NMG has responded to these challenges by making major investments in wastewater treatment, urban drainage, and river channel improvements on local watercourses during the past 10 years. The city has a well-prepared development plan with a principal planning horizon up to 2010. The main development objectives of the city are to continue a high and sustainable rate of economic growth as the main means of improving the quality of residents’ livelihood and reducing 1 ADB. 2004. People’s Republic of China. Country Strategy and Program Update (2005-2007). Manila: ADB. The inclusion of the Project was confirmed during the Country Programming Mission held in April 2005. 2 Nanjing was nominated as the PRC pilot city for the Water for Asian Cities Program implemented by ADB and the United Nations Human Settlements Programme (UNHABITAT). 3 In addition to the Nanjing Qinhua River Environmental Improvement Project, the Government requested advisory technical assistance to support corporate bond issue to fund projects to be undertaken by Nanjing Water Services Group Limited, an integrated water and wastewater company to be established. The public and private sector activities supported by ADB will complement each other, but will be prepared and implemented autonomously. 4 The TA first appeared in ADB Business Opportunities (internet edition) on 16 May 2005. 2 the poverty that still exists for some urban and rural residents.5 Growth in gross domestic product is needed to provide employment for the continuously migrating population from rural areas to the urban areas, as well as from neighboring provinces and cities. NMG has developed plans to meet its urban environmental objectives, which it intends to formalize and restate in its 11th City Five- Year Plan for 2006–2010, currently under preparation. 5. The proposed NQREIP will address the above key urban environmental challenges and is being designed as a natural extension of the investments made in recent years. The rationale is to reduce waterborne pollution and urban flood risk in Nanjing, with particular focus on the Qinhuai River catchment. The Project will improve the urban environment and public health through better management of wastewater and urban watercourses, and will improve the quality of life for the urban poor by mitigating health and other risks from localized flooding and inadequate sanitation. 6. On the basis of discussions with NMG, criteria for the inclusion of project components in the NQREIP were identified.6 After discussions with NMG and project agencies, field visits, and with the objective of achieving maximum developmental impact and value-added from the ADB investment, the identified subprojects were grouped into four multisector components: municipal wastewater management (component A), river system management (component B), stormwater management (component C), and sludge management (component D). 7. Municipal wastewater management includes construction of 2 extensions to wastewater treatment plants (WWTPs) and 13 sewer system subprojects. The WWTPs are (i) phase 2 East WWTP with planned capacity of 100,000 tons/day (t/d), to serve the southeast portion of the urban Nanjing area and encompassing the middle section of Outer Qinhuai River; and (ii) phase 2 Jiangning Science Park WWTP in the new development area of Nanjing with a rapidly growing population, with a planned capacity of 40,000 t/d. This component includes construction of 130 km of dedicated wastewater sewers and the associated secondary branches, which will intercept sewage and convey it to the prospective WWTPs; and five dual-purpose pumping stations. 8. River system management includes (i) flow augmentation, (ii) bank stabilization and erosion control, (iii) water replenishing, and (iv) construction of an urban wetland area. Nanjing has relatively low ground elevation and many rivers, canals, and other waterways; therefore, flood control has been an important task. Historically Qinhuai River’s tributaries were interconnected with sufficient flow capacities. Through years of siltation and improperly managed development activities, flows from these waterways have been