Documentof The WorldBank ReportNo: 19086-BO Public Disclosure Authorized
PROJECT APPRAISAL DOCUMENT
ONA
Public Disclosure Authorized PROPOSED CREDIT
IN THE AMOUNT OF SDR 64.7 MILLION (US$88.0 million equivalent)
TO
BOLIVIA
FOR THE Public Disclosure Authorized ABAPO - CAMIRI HIGHWAY PROJECT
APRIL 28, 1999
Public Disclosure Authorized Finance,Private Sector,and Infrastructure CountryManagement Unit - LCC6C Latin Americaand the CaribbeanRegional Office CURRENCY EQUIVALENTS Currency Unit Bolivianos ($Bs.) LC $Bs. 1 US$ 0.18 US$ I LC $Bs. 5.72 (Exchange Rate April 28, 1999) SDR 1 US$ 1.36202 (Exchange Rate Feb. 28, 1999) BORROWER'S FISCAL YEAR: January 1 - December 31
ABBREVIATIONS AND ACRONYMS
AADT Average Annual Daily Traffic ACA-HP Abap6 - Camiri Highway Project ADL Administrative Decentralization Law CABI Captainship of Upper and Lower Izozog County (Capitania de Alto y Bajo Izozog) CAF Andean Development Corporation (Corporaci6n Andina de Fomento) CAS Country Assistance Strategy CIDOB Federation of Indigenous Peoples of Bolivia (Confederaci6nNacional de PueblosIndigenas de Bolivia) ECP Export Corridors Project EIA Environment Impact Assessment EMP Environmental Management Plan ENFE Bolivian National Railway (Empresa Nacional de Ferrocarriles del Estado) ERR Economic Rate of Return FONPLATA Financial Fund for the Development of the River Plate Basin (FondoFinanciero para la Cuencadel Plata) GOB Government of Bolivia HDM Highway Design and Maintenance Standard Model HIMP Highway Investment and Maintenance Program HIPC Heavily Indebted Poor Countries IBRD International Bank for Reconstruction and Development (World Bank) ICB InternationalCompetitive Bidding ICR Implementation Completion Report IDA International Development Association (the Association) IDB Inter-American Development Bank IRI International Roughness Index MDE Ministry of Economic Development (Ministerio de Desarrollo Econ6mico) NCB National Competitive Bidding NGO Non Governmental Organization PAD Project Appraisal Document PADI Indigenous Peoples Development Plan PCD Project Concept Document PCU Project Coordination Unit PID Project Information Document SDC Departrnental Road Service (Servicio Departamental de Caminos) SNC National Road Authority (Servicio Nacional de Caminos) SRMP Second Road Maintenance Project VMT Viceministry of Transport, Communications and Civil Aeronautics (Viceministeriode Transportes,Comunicaciones y AeronauiticaCivil) VOC Vehicle Operating Cost
Vice President: Shahid Javed Burki Country Manager/Director: Isabel Guerrero Sector Manager/Director: Danny Leipziger Task Team Leader/Task: Jos6 Maria Alonso-Biarge Bolivia Abap6 - Camiri HighwayProject TABLE OF CONTENTS Page No.
A. Project Development Objective ...... 2
1. Project development objective and key performance indicators ...... 2
B. Strategic Context...... 2
1. Sector-related CAS goal supported by the project ...... 2 2. Main sector issues and Government strategy ...... 3 3. Sector issues to be addressed by the project and strategic choices ...... 5
C. Project Description Summary ...... 5
1. Project components...... - 6 2. Key policy and institutional reforms supported by the project ...... 8 3. Benefits and target population ...... 8 4. Institutional and implementation arrangements ...... 8
D. Project Rationale ...... 10
1. Project alternatives considered and reasons for rejection ...... 10 2. Major related projects financed by the Bank and/or other development agencies 11 3. Lessons learned and reflected in proposed project design ...... 12 4. Indications of borrower commitment and ownership ...... 14 5. Value added of Bank support in this project ...... 14
E. Summary Project Analyses ...... 15
1. Economic ...... 15 2. Financial ...... 15 3. Technical...... 15 4. Institutional ...... 16 5. Social...... 16 6. Environmental assessment ...... 17 7. Participatory approach...... 18
F. Sustainability and Risks ...... 18
1. Sustainability ...... 18 2. Critical risks ...... 20 3. Possible controversial aspects ...... 21
G. Main Loan Conditions...... 22
1. Effectiveness conditions ...... 22 2. Other ...... 22
H. Readiness for Implementation...... 23
I. Compliance with Bank Policies...... 23 Annexes
Page No.
Annex 1. Project Design Summary...... 24
Annex 2. DetailedProject Description...... 28
Annex 3. EstimatedProject Costs...... 34
Annex 4. Cost-BenefitAnalysis Summary...... 35
Annex 5. Financial Summary...... 43
Annex 6. Procurementand DisbursementArrangements ...... 44
Table A. Project Costsby ProcurementArrangements ...... 47
Table Al. ConsultantSelection Arrangements . .48
Table B. Thresholdsfor ProcurementMethods and Prior Review...... 49
Table C. Allocationof Loan Proceeds...... 50
Annex 7. FinancialManagement Assessment Summary ...... 51
Annex 8. Environmentaland Social Assessment...... 53
Annex 9. Project ImplementationSchedule ...... 60
Annex 10. Project PerformanceMonitoring Indicators .61
Annex 11. Project ProcessingBudget and Schedule.66
Annex 12. Documentsin Project File.67
Annex 13. Statementof Loans and Credits.69
Annex 14. Countryat a Glance.71
Maps No. IBRD 30220 and IBRD 30221 Bolivia Abap6 - Camiri Highway Project Project Appraisal Document
Latin America and the Caribbean Regional Office Country Management Unit - LCC6C
Date: April 28, 1999 Task Team Leader/Task Manager: Jose Ma. Alonso-Biarge Country Manager/Director: Isabel Guerrero Sector Manager/Director: Daniel Leipziger Project ID: BO-PE-55230 Sector: Transportation Program Objective Category: Economic Management Lending Instrument: Specific Investment Loan Program of Targeted Intervention: [ Yes [X] No ProjectFinancing Data [ Loan [X] Credit [] Guarantee [] Other [Specify]
Amount (US$m/SDRm): US$ 88.0 million equ./SDR 64.7 million Proposed terms: [X] Multicurrency [] Single currency, specify Grace period (years): 10 [] Standard Variable [] Fixed [ LIBOR-based Years to maturity: 40 Commitment fee Standard' Service charge: 0.75%
Financing plan (US$m): Source Local Foreign Total Government 28.0 4.0 32.0 Cofinanciers IBRD IDA 36.4 51.6 88.0 Other (specify) 0.0 0.0 0.0 Total 64.4 55.6 120.0
Borrower: Government of Bolivia Guarantor: Responsible agency: Servicio Nacional de Caminos - SNC (National Road Authority)
Estimated disbursements (Bank FY/US$M): 2000 2001 2002 2003 2004 Annual 16.8 25.4 26.1 13.0 6.7 Cumulative 16.8 42.2 68.3 81.3 88.0
Project implementation period: 10/01/1999 - 06/31/2003 Expected effectiveness date: 10/01/1999 Expected closing date: 06/30/2004
I A variablerate between0% and 0.5% of the undisbursedcredit balanceset annuallyby the ExecutiveDirectors of IDA.
OSD PAD Form: July 30, 1997 Page 2
A: Project Development Objectives 1. Project developmentobjective and key performanceindicators (see Annexes land 10): The overall purpose of the project is to improve transport conditionsalong a strategic north-southcorridor linking the Bolivian departmentsof Beni, Santa Cruz, Chuquisaca,and Tarija and continuingto Argentina and Paraguay. By rehabilitatingand improvingthe Abap6-Camirisection of the Trinidad-YacuibaHighway, the Project aims to:
(a) lowertransport costs; (b) foster the economicdevelopment of the Project Area; (c) improvethe incomelevel of the indigenouspeoples in the Project Area; and (d) establish economictransport links between the Borrower's territoriesand neighboringcountries.
The project also aims to introduce comprehensivemaintenance by contract of part of the national road network with two purposes: (i) to ensure that the remaining corridor and the roads feeding into it will be in good conditionwhen the project is completed;and (ii) to extend the programto the entire national network, if it proves successful, so contributing to solve the road maintenance problems caused by the decentralization-recentralizationprocess, still underway.
Key indicators of the project's performancewill be: (i) year-round good condition for all sections of the corridor and connected roads feeding into it; (ii) traffic volumes in the corridor increased by 80%; (iii) vehicle operating costs in the corridor reduced by 50%; (iv) transportationcosts in the corridor reduced by 20%; (v) average travel time between Abap6 and Camiri reduced by 3 hours; and (vi) maintenance by contractextended to the whole nationalnetwork and installedcapacity in SNCto implementconcessions.
B: Strategic Context 1. Sector-relatedCountry Assistance Strategy (CAS)goal supportedby the project (see Annex 1): CAS document number: 17890B0 Date of CAS Discussion: June 16, 1998 • The project is consistentwith the CountryAssistance Strategy discussed by the Board on June 6, 1998. This documentwas formulatedwithin a participatoryframework both internally in the IDA and with the GOB, which has identifiedthree priority focuses for the IDA's support: (i) opportunity;(ii) equity, and (iii) institutionality. Within each area, top three strategies to be pursued have been defined. The proposed project responds to the highest strategic priority in the area of opportunity. Within this framework, the project would create opportunities by improving the physical and productive infrastructure,particularly the Bolivian national road network, and ensuring adequate road maintenance planning, financingand execution.
* The projectcontributes to the objectiveof developingregions of high agriculturalpotential by facilitating their access to the internationalmarkets. The project addressesthose areas highlighted in the CAS for specialattention.
* The poor condition of the Abap6-Camiri section is a major remaining constraint to achieving the integration of Bolivia into the regional economic bloc (Mercosur) through the completion of the Trinidad-Yacuiba export corridor to Argentina and, in the future, Paraguay. When completed, together with the West-East Corridor between the borders of Chile and Brazil, this corridor would link the Page 3
agricultural regions of Beni and Cochabamba with Santa Cruz and all of them with export markets in Argentina, Brazil and Paraguay. This would facilitate the diversification of agricultural production to non- traditional cash crops for export in order to meet the commitment to eradicate coca production. The Santa Cruz-Abap6 and Camiri-Yacuiba sections of the corridor have already been completed; the Santa Cruz- Trinidad (Beni) section is under construction, and the construction of the complementary road from Boyuibe to Hito Villaz6n, that connects with Paraguay, is expected to be financed by FONPLATA. The CAS includes, in the transport program, the construction of the San Jose-Puerto Suarez section of the Santa Cruz-Corumba (Brazil) highway to complete the West-East corridor. These two operations will assist the GOB in the timely completion of Bolivia's highest priority export corridors. The proposed investment has been defined in close coordination with the Government, IDB, CAF, FONPLATA and other international donors active in this sector. 2. Main sector issues and Government strategy: Road Sector Issues: As a landlocked country with rugged topography, Bolivia sorely needs a well functioning transport system to sustain its economic development. Distances between cities are long; rural areas are thinly populated and lack access to markets due to high transport costs; mountains and rivers act as barriers; and access to seaports is limited and costly. In the past nine years, the Bolivian transport sector has witnessed important changes that have brought about, with IDA's support, reductions in the transport costs for externally traded goods and commerce in particular in the western part of the country, where for the first time a paved road has been constructed connecting Bolivia with the port of Arica in Chile. The main sector issues are:
* The geography of Bolivia, which spans from peaks of 6,500 meters in the highlands of the Andes to 200 meters in the lowlands of the Amazon basin. As a consequence, Bolivia has to maintain all- weather roads and spend more to sustain the road transport sector, compared to other countries.
* Road maintenance management and financing. Traditionally, external financing to SNC has been mainly allocated for new construction and major rehabilitation programs. The implementation of the Second Road Maintenance Project (SRMP), financed by IDA, marked a change in emphasis of activity of SNC, with a greater focus on maintenance. Maintenance and equipment management systems, designed and implemented under the Export Corridors Project, were extended to the old SNC's districts and allocations for maintenance and the national budget substantially increased, following the requirements of the project covenants. Unfortunately, this process was interrupted by the administrative decentralization of SNC and the entire network carried out in 1995.
The new government, which took office in August 1997, immediately recognized the weaknesses of the institutional framework. It passed Law 1788 on September 16, 1997 to restore responsibility for the national road network to SNC. In essence, it aimed to recentralize the national network and rebuild SNC. Under this framework, the decentralized Servicios Departamentales de Caminos (SDCs) are to keep responsibility for the secondary networks in their respective departments and the municipalities for the rural roads. The human resources, equipment, most of the financial resources and materials transferred to the departments under the decentralization will remain with the departments. The proposed framework, according to Supreme Decree No. 25134, was officially approved by the Cabinet at the end of August 1998. This establishes: (a) the National Road Network with approximately 10,000 km distributed among 11 routes; (b) a Road Maintenance Account and, (c) that the resources SNC needs to take over the responsibility of the national network should come from tolls and funds from the National Treasury. The government has decided that all maintenance works will be done by contract except for emergency works, but major tasks required to execute routine maintenance by contract are not yet ready. The GOB, based on the approved Supreme Decree, has already started to prepare the reorganization of SNC, which is expected to be completed by the end of 1999. Page 4
The government's intentions aim in the right direction, and SNC shows adequate capacity and motivation to take control of the national network. SNC is taking over responsibility for planning, coordination, and supervision of the national road network, so that a consistent approach can be followed in the overall development of the system. Responsibility for the secondary network and rural roads is to be left with the Prefecturas and Municipalities. SNC will be responsible for implementing projects with the international agencies financing the national network and establishing national priorities in close coordination with the Ministry of Finance. Maintenance of the national network is to be carried out by contract. However, until now, there is no experience in Bolivia of maintenance by contract. Hence the importance of including a comprehensive maintenance by contract program as a component of this project. Concerning the secondary network, a study, financed under the SRMP, is evaluating the situation under the new administrative framework. The study is expected to be completed by June 1999.
Although road users pay substantial amounts of user charges and taxes, the system of reallocating them through the budgetary process has left substantial funding gaps. Ensuring an adequate flow of funds to the road sector is one priority that has also been addressed in the new Supreme Decree, by establishing a Road Maintenance Account (Cuenta de Conservacion Vial) to be funded mainly with resources from road tolls and, if necessary, complemented with National Treasury funds. Of the total tolls collected nationally and managed by SNC, 70% will be allocated to the main road network and 30% to the secondary network.
Attention is also being given to the possible participation of the private sector in maintenance, rehabilitation and construction of roads. In Bolivia, given the current levels of traffic (which even if they justify an investment on economic grounds may not be enough to make it bankable exclusively on the basis of tolls), it is difficult to envision a wide participation of the private sector in the construction or rehabilitation of roads. Nevertheless, the country should move in the direction of exploring ways to reduce the costs of maintaining the roads and doing it in an effective manner. For this purpose, the participation of the private sector will be explored in an incremental manner, beginning with a maintenance by contract program financed by the project and possibly expanding to concessions for maintenance and rehabilitation. Concessions for construction (or BOT projects) could also be explored for specific links on the basis of public-private partnerships. The IDB is financing a study on the prospects and framework for road concessions. The proposed project would provide technical assistance to carry out the feasibility study on the Santa Cruz - Puerto Suarez concession initiative. Furthermore, the law that establishes the legal framework for concessions of transport public works (Ley de Concesiones de Obras Puiblicas de Transporte) was approved by the Congress on June 1998. The bylaws of this law have been drafted and are expected to be approved in early 1999.
* The location of the existing road infrastructure, which, to a large extent, has been built in the western part of the country because, in the past, Bolivia mainly relied on mineral exports and the corresponding transport network was developed to support this sector. The highlands, where the mines and much of the population are located, have one-sixth of the land area, but contain over one-third of the total transport infrastructure. With a decline in the dominance of the mining industry, future economic prospects require that the development emphasis shift to agricultural regions and growing of non- traditional export crops. Therefore, the eastern part of the country is expected to have most of the economic growth and future development. This would require the development of a road network, particularly in the valleys and the lowlands to link the rural agricultural communities with the main export centers.
While the above issues need to be addressed by furthering the process of reforms, the prospects for improved sustainability of the institutional capacity are good and the government is already aware of the risks involved in the more contentious aspects of the decentralization of road management. As noted above, the government has already taken actions to recentralize the national network and improve the road maintenance system with the support of the on-going SRMP. Page 5
3. Sector issues to be addressed by the project and strategy:
The project would assist the Government in defining and implementing the agreed transport-sector strategy. It will contribute to: (i) support export corridors development; (ii) improve the interconnection between cities and the integration of inter-regional trade and commerce; (iii) provide access to markets for regions with high agricultural potential; and, (iv) through the program on road maintenance by contract and technical assistance for a road concession program, provide an instrument to ensure adequate maintenance practices and financing in the national network and increase the participation of the private sector.
C: Project Description Summary
The Santa Cruz-Yacuiba road is part of the Trinidad-Yacuiba "integration corridor" (so called by the Bolivian Government) which is about 1,084 km long to the border of Argentina and provides an outlet to Rosario, a port on the Parana River reached by ocean-going ships. The corridor has 8 sections. Two are under construction and financed with CAF funds (Casarabe - San Pablo and San Pablo - Yotau). Five other sections are already paved and in service (Trinidad - Casarabe; Yotaii - San Ram6n - Pail6n; Pail6n - Santa Cruz; Santa Cruz - Abap6; and Camiri - Yacuiba. The Abap6-Camiri section is the missing link. This corridor also provides access to the regions between Santa Cruz and Cochabamba served by the East-West export corridor (between the borders of Brazil and Chile). Among those regions is the Chapare, where the coca plant is grown and is being replaced by alternative crops, for which the natural market is Argentina.
The proposed IDA credit would finance the reconstruction and paving of the Abap6-Camiri highway, which is 152 km long following Route 9, including the 7.3 km by-pass to avoid going through the town of Camiri. The project consists of reconstruction and paving of the existing road, which is now in poor condition, and construction of a new bridge over the Rio Grande of about 420 m. The road is currently a gravel road with good geometric characteristics. However, it needs minor re-alignments and by-passes to avoid crossing small villages, resettlement and safety problems. The road would be strengthened to fully accommodate growth in export traffic. Realignments and reconstruction works would meet the geometric and structural standards established for national roads in Bolivia, under which the Santa Cruz-Abap6 and Camiri-Yacuiba sections were reconstructed. Land acquisition and people relocation will be financed by the Government under a plan satisfactory to IDA. The engineering studies are already completed for Abap6-Camiri highway and the access road to El Espino.
The project would also include a program of comprehensive maintenance by contract for the period 1999- 2003. The objective of this program is to ensure that the remaining corridor and the roads complementing it, will be in good condition when the project is completed. The project would also provide technical assistance to strengthen SNC's and VMT's institutional capacity, to study the feasibility of a Santa Cruz - Puerto Suarez highway concession initiative, support the Project Coordinating Unit (PCU) and training activities; and strengthen SNC's Environmental Unit.
The credit would provide US$88.0 million equivalent to finance the project, divided among the following components: Page 6
1. Project components (see Annex 2for a detailed description and Annex 3for a detailed cost breakdown): Component Category Cost Including % of Bank- % of Contingencies Total financing IDA- (US$M) (US$M) financing
A. Abap6-CamiriHighway: Physical 97.3 81.0% 77.8 80%
Reconstructionand paving of the Abap6 - Camirihighway of 152km. A two-lane road, 7.3 m wide with two shoulders1.5 to 2.0 m each (dependingon terrain characteristics),fully paved and re- aligned.The indicativecost includes: * Directcosts, * physicaland price contingencies,and * supervision.
The changesin alignmentswill allow a speedof 80 km/h in the hillyterrain and 100 km/h in the planes. The estimated time for constructionis 36 months. The proposedcredit wouldfinance 80% of the total cost for civil works and 80% of supervision.
The road will be split in the following segments:
(a) New bridge(420 m) over the Rio 4.9 4.0% 3.9 80% Grandein Abap6 incl accesses(0.44 kin)
(b) Abap6-lpita(63.5 kmn) 40.3 33.6% 32.3 80%
(c) IpitA-Ipati(49 km) includingthe by- 30.1 25.0% 24.0 80% pass of Gutierrez (d) Ipati-Camiri(30.7 km) 16.6 13.8% 13.3 80%
(e) By-passof Camiri(7.3 km). 5.4 4.5% 4.3 80% Constructionand paving of a 7.3 km bypass to avoid going throughthe town of Camiri.
B. AccessRoad to El Espino(38 km): Physical 8.5 7.0% 6.8 80%
Reconstructionand paving of an existing dirt road that runs parallel to the rail track to Charagua,a two-laneroad, 6.0 m wide with two shoulders0.5 m each, to provide accessto the corridorfor the indigenous communities.
The indicativecost includes: * directcosts, * physical and price contingencies,and Page 7
Component Category Cost Including % of Bank- % of Contingencies Total financing IDA- (US$M) (US$M) financing * supervision.
The proposedcredit would finance80% of the total costs for civil works and 80% of supervision.
C. ComprehensiveMaintenance by Institution 12.2 10.2% 2.9 24% Contract: Building/ Physical A programof comprehensive maintenanceby contractfor the period 1999-2003. The indicativecost of this componentincludes supervision and technicalauditing and encompassesabout 900 km of roads in the departmentof Santa Cruz. The proposedcredit would finance:
(i) 20% of civil works, and (ii) 80%of supervision.
D. InstitutionalStrengthening: Institution 2.0 1.7% 0.5 25% Building/ Institutionalstrengthening of VMT and Physical SNCthrough the provisionof technical assistancefor:
(a) Consultingservices to:
(i) carry out a feasibilitystudy for the 0.1 0.1 100% San Jose - Puerto Suarez highway concessioninitiative, (ii) strengthenand operatethe Project CoordinatingUnit, SNC's 0.1 0.1 100% EnvironmentalUnit, and provide trainingto SNC,and (iii) prepare technicaland financial audits
(b) Acquisitionof goods 0.1 0.1 100%
(c) Routinemaintenance program 80% 0.1 0.1 (d) Implementationof the Resettlement 20% Plan, IndigenousPeople Development 0.2 0.1 Plan, and the CommunityRelations Plan. 0% 1.4 0.0 The proposedcredit would finance: 100% of consultantsand servicesfor (a); 80%of goodsand equipmentfor (b); and 20% of maintenanceworks for (c).
Total 120.0 100% 88.0 73% Page 8
2. Key policy and institutional reforms supported by the project: Reforms to carry out maintenance of the national road network by contract will be at the top of the project's agenda, because neglect of road maintenance can ultimately result in high costs to restore infrastructure and in particular the proposed highway. As there is no current experience with contract maintenance, a comprehensive program will form part of the proposed project. If it proves successful, the program will be extended to the entire national network. This would substantially solve the road maintenance problem caused by the decentralization-recentralization process, still underway. The Spanish Consultant Trust Fund has financed the preparation of this program by consultants.
3. Benefits and target population: As noted above (page 3), the project will remove constraints in transport and reduce transport costs for goods and passengers. It will promote social and political interaction among the indigenous people and local communities. This will enable a higher level of economic activities and stimulate education, trade, exports and the mobility of people. By reducing travel time and improving road alignments, the proposed project would upgrade transport communications between Santa Cruz and Yacuiba, the border with Argentina and also with Paraguay, when the Boyuibe - Hito Villaz6n section is finished. Compared to the existing road, (i) average travel time would be reduced by more than 3 hours between Abap6 and Camiri; and (ii) cost per vehicle-kilometer for the vehicles using the new road would be reduced from US$0.55 to 0.19 for cars and from US$1.59 to 0.64 for heavy trucks (see Annexes 4 and 10). The reliability, safety and quality of freight and passenger transport services would be improved, and opportunities provided for increased education as well as socio-political interaction among the communities along the entire corridor.
These benefits would accrue to two main groups:
First, the medium and long-distance users of the export corridor. The main beneficiaries are located in the Chapare region of Cochabamba, the southern provinces of Beni, the entire Santa Cruz department, the Hernando Siles and Luis Calvo provinces of Chuquisaca and the Gran Chaco province in Tarija.
Second, the beneficiaries of the access road to El Espino which are the agricultural population and local communities of the Santa Cruz, Rositas, Oquitas, Izozog, El Espino and the Ava Guarani indigenous people settled in the vicinity of the Abap6-Charagua-Yacuiba railway. The representatives (Capitanes Grandes) of the Karaguazu, North Charagua and Upper and Lower Izozog ethnic groups have officially requested that adequate access be provided, mainly to Santa Cruz, to benefit from the construction of the highway and the access to El Espino.
4. Institutional and implementation arrangements: The Economic Development Ministry-MDE (Ministerio de Desarrollo Econ6mico) and in particular the Vice Ministry of Transport, has overall responsibility for the transport sector and the policy framework within which the project will be implemented. SNC, the national road agency,will have the mandate to manage the national road network beginning 1999 and would be responsible for the execution of the project.
During implementation of the Export Corridors Project (Credit 2012-BO) and the Second Road Maintenance Project (Credit 2395-BO), SNC was strengthened with the development of: (a) maintenance and equipment management information systems, (b) organizational structure that gave proper emphasis to the maintenance function, and (c) processes that emphasize adequate consideration to planning and environmental control. The maintenance and equipment management systems were extensively used by the district offices to report to SNC management on maintenance execution. Furthermore, traffic counters and axle-load control equipment were purchased. This equipment allows SNC to control the overloading of vehicles (to prevent premature deterioration of the infrastructure), and, along with equipment that measures surface and structural conditions, to build an information base upon which to establish investment priorities and plans. Page 9
In August 1995, the Administrative Decentralization Law (ADL) established a new institutional framework for the sector, mandating the transfer of road management functions to the nine Prefecturas, along with a sizable amount of human and financial resources (including road tolls). As the number of staff was reduced, SNC weakened and its budget was also cut. As described above, the Government has already dealt with most of the problems caused by the ADL with the approval of the Supreme Decree that re-establishes the national road network and clarifies SNC's role.
SNC is now being improved through the technical assistance component of the on-going SRMP project to assist the Government in a reorganization aimed at: (i) strengthening the role of the regional and local administration in line with the new Decree; (ii) streamlining existing departments, (iii) strengthening SNC's capacity to deal with environmental issues; (iv) training its personnel; (v) tightening up financial and procurement procedures; (vi) developing a plan of action to deal with the shortage of technical personnel and further improve salary policies, financial controls, and budget mechanisms; and (vii) shift the role of the Vice Ministry of Transport to mainly deal with policy issues. The SDCs will continue to be in charge of maintaining the secondary network and the municipalities will be in charge of rural roads. The project will finance a program to contract out comprehensive maintenance with the purpose of extending it to the whole national network, if it is successful. Future financing of maintenance could be provided by the proposed road maintenance account, which has been designed with IDA's support and supervision.
Accounting, Financial Reports, and Auditing. For the purposes of carrying out the project, a Special Account would be opened and maintained in US Dollars at the Banco Central de Bolivia on terms and conditions satisfactory to IDA. Deposits into the Special Account and their replenishments, up to the Authorized Allocations set out in the Disbursement Letter, will be made initially on the basis of Applications for Withdrawals (Form 1903) accompanied with the supporting and other documentation as specified in the Disbursement Handbook. Once the accounting and financial management systems of the SNC are deemed compliant with LACI requirements, and are certified as such by IDA, a migration to a Project Management Reports PMR-based type of disbursements may be implemented as described hereafter.
Since the project is to be administered by SNC, IDA conducted a review of the accounting, controls over disbursements and resources, planning and budgeting, as well as, the level of administrative staff. It was determined that SNC has in place accounting and internal control systems that accord with such accounting standards or agreed format and that reliably record and report all assets and liabilities and financial transactions of the project and the entity, including those transactions involving the use of Bank funds; and provide sufficient financial information for managing and monitoring project activities.
Migration to LACI. During negotiations, it was agreed that within a year from the date of effectiveness SNC would complete their action plan for the strengthening of its financial management system in order to enable it to prepare quarterly Project Management Reports (PMRs) which they cannot do at present. Each of these reports would: (i) show actual sources and applications of funds for the project, both cumulatively and for the period, and projected sources and applications of funds for the project for the following six months; (ii) list separately expenditures financed out of the credit during the period covered by the report and expenditures proposed to be financed during the following six months; (iii) describe physical progress in project implementation, both cumulatively and for the period covered, and explain variances between the actual and previously forecast implementation targets; and (iv) set forth the status of procurement under the project and expenditures under contracts financed from the credit, for the period covered.
Audit Arrangements. An independent external auditing firm, satisfactory to IDA, would be hired to carry out annual audits of the project and the entity. IDA's Financial Accounting, Reporting and Auditing Handbook (FARAH), published in January 1995, would be used by external auditors, in accordance with existing IDA procedures. Audit reports would be presented to IDA no later than six months after the closing date of the previous fiscal year. It was agreed during negotiations that the financial audit will be contracted for the total estimated period of project implementation and that the procurement process for the audit will start as soon as the credit is effective. Page 10
D: Project Rationale
1. Projectalternatives considered and reasonsfor rejection:The only alternativethat could be consideredis the railway (ENFE - Empresa Nacional de Ferrocarriles) that goes from Abap6 to Yacuiba passing through Charagua, which was capitalized through private sector participation in 1996 with the support of the Export Corridors Project. With this capitalization, the GOB did not sell the company's assets but instead contributed to the formation of a corporation with a 50% participation of a private partner, an amount which stays in the company, thus increasing its value. While the track and infrastructure have remained in the hands of the GOB, their maintenance and improvement have been carried out by the capitalized company. In order to use the railway effectively, it is necessary to have a complementary road transport system in place to bring produce from the farm to the railway's loading points. Taking advantage of its monopoly power on many routes, ENFE keeps its tariffs high, causing non-traditional agricultural exports to be less competitive. Moreover, under the current structure, investments in the railway's maintenance, modernization and expansion are dependent on the GOB's decisions and the willingness of the private partners to advance capital. The GOB has continued to provide funds to meet ENFE's recurring resource gap, as its performance contracts with the Government have not yet worked well. The company needs additional incentives and financial resources to operate effectively. Given this scenario, the railway can not be considered a viable alternative.
Concerning the proposed project, two alternative routes were considered: The first alternative was to upgrade the original road and, additionally, build and pave the existing access road to El Espino. The second alternative assumed that the proposed road would not follow the original route and would include a diversion through El Espino - IpitA. This alternative would increase the total length of the main road by 10 km, significantly affecting the project economics, as proved by the economic analysis carried out. Furthermore, this alternative posed some serious environmental and social concerns. The preparation mission in February 1998 suggested to the Government that it carefully internalized the cost of such concerns into the analysis. The resulting analysis showed that the cost of the diversion through El Espino would be high and its socio- environmental impacts would be adverse. Under these circumstances, the project would have had to be environmentally rated "Category A", which would have translated into additional cost and time to prepare.
The cost difference between both alternatives may well finance the access road to El Espino, while protecting the benefits to the medium -and long- distance traffic. Taking into account these factors, the Minister of Economic Development sent a letter to the Bank, on February 27, 1998 expressing the interest of the GoB in following the first alternative. During the June 1998 preparation mission a meeting with the national, departmental and local authorities was held and the outcome of the meeting was a consensus of choosing the first alternative, under the following conditions: (i) that the access road to El Espino should be financed with IDA funds under the proposed project; and (ii) it should be reconstructed at the same time as the Abap6- Camiri highway. Page 11
2. Major related projectsfinanced by the Bank and/orother developmentagencies (completed, ongoing and planned): Sector Issue Project Latest Supervision (Form 590) Ratings (Bank-financed projects only) Implementation Development Progress (IP) Objective (DO) Bank-financed Overall terms project objectives. Bolivia Export Corridors Project (Cr. S S The physical implementation. 2012-BO). Closed June 30, 1996 Institutional capacity building Second Road Maintenance Project S S (Cr. 2395-BO). Closing date: June 30, 2000 (two extensions with a total of 24 months). Other developmentagencies IDB - Interamerican * Cotapata - Santa Barbara; 49.1 S S Development Bank Road Km under construction; expected Construction to finish in June 2000
* Rio Seco - Desaguadero; 95.3 S S Km under construction; expected to finish in Dec. 99
Technical Assistance - Studies . Ventilla - Tarapaya, 60 km; S S studies completed Dec. 98. Negotiated February 99. Board approval scheduled by May 99.
* Pail6n- San Jose; 219 Km, N.A. N.A. studies expected to finish in April 99.
* Study on prospects and framework for road concessions, in the bidding process; finished in Dec. 98.
CAF - Andean Development * Padcaya - Campanario; 25 Km N.A. N.A. Corporation under construction; extended to Road Construction La Mamora; 23 Km, expected to finish in Jan. 2000.
* La Mamora - Emborozu; 20 Km under construction; expected to finish in April 2000.
* San Pablo - Casarabe; 88 Km under construction; expected to finish in Sep. 99
. Yotau - Ascenci6n de Guarayos; 48 Km under construction; expected to finish in Oct. 99. Page 12
Sector Issue Project Latest Supervision (Form 590) Ratings (Bank-financed projects only) Implementation Development Progress (IP) Objective (DO)
• Ascenci6nde Guarayos- San Pablo; 113.5Km, under construction;expected to finish in Sep. 99.
* Yamparaez- Tarabuco;35 Kin; underconstruction, expected to finishApr. 2000.
. Potosi- Cuchu Ingenio;37 Km; underconstruction, expected to finishApr. 2000.
* Sunchu Tambo- Puente Sacramento,17 Km; under construction,expected to finish Nov. 99.
* Challapata - Ventilla 93 Km; to begin construction.
FONPLATA * Abap6 - Camiri; 152 Km, S S TechnicalAssistance - Studies studiesfinished in Jan. 99. • Boyuibe - Hito Villaz6n, 135 Km studiesongoing; expected to finishin March 99. * Cuchu Ingenio - Villaz6n, 323 Km studiesongoing; expected to finishin Dec._99. IP/DORatings: HS (Highly Satisfactory),S (Satisfactory),U (Unsatisfactory),HU (HighlyUnsatisfactory)
3. Lessons learned and reflected in the project design:
Prior to the Export Corridors and Second Road Maintenance Projects, the Bank Group's operations in the transport sector were limited to five loans/credits during FY1972 to FY1978. Three were for railways (FY1972, FY1974 and FY1977), one for road maintenance (FY1978), and one for civil aviation (FY1977). SNC benefited from extensive financial and technical assistance provided by the US Government since 1964 and by IDB in the 1970s. The absence of new operations between 1978 and 1986 reflected the deterioration of the country's economic management during this period.
The Bank Group's first involvement in roads was the Highway Maintenance Project (Ln. 1567-BO) in 1978 (Bolivia was an IBRD borrower prior to 1985, when it once again became eligible for IDA, because of economic collapse between 1980 and 1985). The Export Corridors Project (Cr. 2012-BO) was approved in May 1989 and closed on June 30, 1996, one year after the original closing date. The Second Road Maintenance Project was approved in May 1992 and is still under implementation. Page 13
The ICR for the Export Corridors Project (ECP) was completed on May 15, 1997. This project was designed to: (a) upgrade key links in the transport network, particularly on those corridors connecting Bolivia to its two export railway routes, one to the Pacific (to the port of Arica in Chile) and another to the Atlantic (via the river port of Puerto Quijarro on the Parana) and one export road to the Pacific (La Paz-Patacamaya- Tambo Quemado-Arica and its connection with Oruro and Cochabamba, the West-East corridor); and (b) strengthen the functioning of key transport sector institutions, particularly the national railway company (ENFE) to make it more market oriented and the national road agency (SNC) to improve road maintenance. The credit for the Second Road Maintenance Project (SRMP) was originally due to close on June 30, 1998 but, to complete the works already awarded, a first extension (of nine months) was approved until March 31, 1999; and based on GOB's compliance with 6 conditions that will contribute to achieving the project's objectives, a second extension of 15 months until June 30, 2000 was approved in January 1999. The project was designed to: (i) improve road conditions in order to reduce vehicle operating costs, improve access to markets and encourage trade development; (ii) improve the road maintenance budget process; (iii) improve road maintenance management, planning and operations; (iv) improve investment planning; (v) assure adequate maintenance funding and financial self-sufficiency for the national road authority (SNC); (vi) strengthen the domestic construction industry; and (vii) transfer maintenance technology and organization to the road regional districts of SNC.
The Export Corridors Project, with five different components in two subsectors and several implementing agencies, did not have a substantive impact on some of its objectives except in the road subsector, in which the El Alto-Patacamaya-Oruro highway was successfully completed on time, road maintenance and equipment management systems were fully implemented and the assistance to the Emergency Social Fund was successful. The project was perhaps too ambitious because of the breadth of interventions. It is instructive that to achieve a greater impact, either the objectives of particular project components need to be less ambitious or the number of sub-sectoral components must be reduced to allow for a sharper focus and more specific and pragmatic interventions.
During the implementation of theses two projects, many components often suffered from continuous reshuffling of staff. Shielding project implementation from staff changes is not a simple task, but it could be improved by:
(a) engaging key long-term consultants that sustain the implementation pace in spite of staff or administration changes, though this approach may be to the detriment of achieving the intended institutional development objectives; (b) designing projects in an incremental or stepwise fashion in such a way that each stage must be completed within a given governmental administration; (c) subsequent stages are contingent on the accomplishment of the specified implementation and development indicators and benchmarks; and (d) carrying out reforms in the civil service through which a more limited but well-remunerated human resource base, subject to satisfactory performance, assumes the responsibility for managing investment projects in the public sector. This lesson is particularly critical in situations where the managerial and technical resource base of the public sector is limited.
The experience of the implementation of the Bolivian institutional reforms confirms that reform processes, when undertaken without a clear consensus and no pre-defined strategies, rarely produces the intended results. The application of the Administrative Decentralization Law (ADL) to the road sector during the implementation of the SRMP lacked a clear strategy. The experience shows that it is not enough to pass legislation, it is also necessary to internalize strategies and concepts, and to define an incremental process which would allow change to take place in the light of the acquired practice and institutional capacities.
In the road sub-sector, the lack of a pre-defined strategy and the sheer magnitude of the tasks required the issuance of a specific decree for the purpose of limiting the overall impact of the ADL and clarifying the new institutional structure. However, the decree attempted to achieve a compromise totransfer some functions to Page 14 the VMT which, in light of the capitalization of the public enterprises under its jurisdiction, was being divested of major responsibilities. The decree also established supervisory standards which require a strong institutional base and a clear structure of incentives. Most of them have not been implemented because of the weak institutional base and insufficient efforts to overcome it through institutional strengthening programs. Rushed approval of legislation and the lack of an integrated strategy to support the change, in a country with limited institutional capacity, has led to an uncertain outcome.
Furthermore, the following issues (some of them not specifically identified in the appraisal report) have arisen during the implementation of the SRMP: (a) enforcement capacity in the central government for maintenance programs is inadequate; (b) commitment of central governmnentto implement a sustainable financing mechanism for maintenance is weak; (c) the financial and execution capacity of contractors is limited; (d) the project management and internal control capacity of the executing institution is inadequate; (e) civil works started late and some cost overruns occurred; and (f) severe storns during rainy seasons affected the pace of project management and implementation. The bad weather during part of project implementation, changes in government administration (in 1993 and 1997) and continuing difficulties with the institutional framework have contributed to delays in project implementation.
The design of the proposed project adequately internalizes the lessons learnt from these projects. The project is basically limited to three components (road and bridge construction, comprehensive maintenance, and institutional strengthening) and adequate technical assistance is being included to further the reform process initiated under the previous and on-going projects to enhance sustainability. The technical assistance would build adequate capacity to enhance execution capacity in the VMT and SNC.
4. Indications of borrower commitment and ownership:
GOB's ownership of the project is confirmned by the priority given to the project in the National Development Plan to the works already underway (to complete other sections of the corridor) and the request for IDA support.
This project was identified by the Government as high priority in its development plan for its contribution to poverty alleviation, regional integration and promotion of non-traditional export crops. The project has been discussed at the highest level of the Government.
The road reconstruction works have been divided in five packages, and all of them are subject to pre- qualification of contractors. The pre-qualification process is underway.
5. Value added of Bank support in this project: IDA support to the sector is critical both for timely and responsive funding for urgent priorities and for its technical cooperation and assistance. This response is being re-enforced by the on-going reform program and construction of other sections of the Santa Cruz-Yacuiba road financed by other donors, particularly IDB and CAF.
Through its sequence of loans to the transport sector, IDA has built up credibility for its integrity, strong control of funds, and avoidance of political interference. During the conception and execution of the project, it will contribute to ensure transparency in the bidding process and, therefore, better use of public resources. IDA involvement is also expected to benefit the design and quality of construction of highways, and foster improved practices in the areas of environment, land acquisition and resettlement. IDA will also bring to bear its extensive experience in similar projects in countries with institutional and maintenance problems at different stages of decentralization. Page 15
The project is very costly relative to the internal resources the Government can devote to roads. IDB has already lent a large amount of its available resources for road construction in the past years; and CAF is no longer able to lend large amounts due to debt reduction agreements, from which Bolivia is benefiting through the Heavily Indebted Poor Countries Program, that establishes limits on the amounts the country may borrow on commercial terms.
E: Summary Project Analysis (Detailed assessments are in the project file, see Annex 12) 1. Economic (supported by Annex 4): [X] Cost-Benefit Analysis: NPV=US$56.0 million; ERR= 19.1% []Cost Effectiveness Analysis: [] Other
The Abap6-Camiri section and the access road to El Espino, and all roads to be rehabilitated and/or maintained under the comprehensive road maintenance program were evaluated using the Highway Design and Maintenance Standards Model (HDM), which simulates life cycle conditions and costs and provides economic decision criteria for multiple road design and maintenance alternatives, based on a survey of road characteristics, traffic, and agency and user costs.
All sections to be paved on the Abap6-Camiri highway and all sections in the comprehensive road maintenance program yielded an economic internal rate of return (EIRR) greater than 12 percent. The paving of the access road to El Espino is expected to yield an EIRR of 10.5 percent based on lower vehicle operating costs but it will also generate non-quantifiable social benefits to the indigenous communities in the area (36,000 inhabitants in 2002), whose economic base is agricultural production.
The analysis yielded a project net present value (NPV) of $56.0 million at 12 percent discount rate and an EIRR of 19.1 percent. The highway component yields an EIRR of 19.1 percent and the road maintenance program yields an EIRR of 19.4 percent. Around 50 percent of the benefits will accrue to low-income groups. The economic justification is robust; agency costs would need to increase by 69 percent or user benefits to decrease by 41 percent to yield a zero net present value. A worst case scenario of increasing agency costs by 20 percent and decreasing user benefits by 20 percent yields an economic internal rate of return of 13.5 percent.
2. Financial (see Annex 5): A set of performance indicators is included (see Annex 10) to monitor adequate financing of the project maintenance activities, as well as the Road Maintenance Account set up by the GOB to finance maintenance of the whole main road network.
Fiscal impact: The direct total fiscal impact of the project is a domestic financed deficit of US$32.0 million. This is to be funded by the Borrower in the 1999 - 2003 period (calendar years, Borrower's fiscal years) as follows: 1999 - US$2.7 million; 2000 - US$6.9 million; 2001 - US$8.9 million; 2002 - US$7.8 million, and 2003 - US$5.9 million. This is a tentative schedule and may suffer changes. The counterpart funds, averaging US$6.4 million per year, are equivalent to about 2.2% of the US$286 million, which is the fiscal deficit target (3.9% of GDP) agreed with the IMF for CY 1999.
3. Technical: The design standards for the project roads are shown in Annex 2. Alternative pavement types were evaluated. Cement concrete paving would be more resistant to rainfall but considerably more expensive, Page 16 even on the basis of life-cycle costing. The cost estimate for the major bridge assumes a post-stressed concrete structure; bidders could be invited to submit alternative designs in accordance with IDA's standard bidding procedures. The term "comprehensive maintenance" includes not only routine and periodic maintenance, but also user and maintenance management services, and emergency coverage.
4. Institutional: a. Executing Agencies: SNC, the national road agency, will be responsible for managing the Bolivian national road network beginning 1999 and for implementing the proposed project. Law 1788 aimed to recentralize the naticnal network, as well as SNC. The GOB started preparing for the reorganization of SNC during 1998. The government's intentions aim in the right direction, and SNC shows adequate capacity and motivation to take control of the national network. Under this framework, SNC will also be responsible for executing the construction and maintenance of the main network with international financing agencies and establishing national priorities.
b. Project Management: The Administration, which took office in August 1997, has approved new legislation that will contribute to: (a) clarifying the institutional framework for the road administration; (b) tailoring the application of the decentralization to the capacities and resources of each SDC; and (c) promoting cooperation between SNC and the SDCs, to strengthen the technical, planning and administrative capacities of both. Furthermore, the proposed road maintenance account will contribute to ensure sustainable financing of road maintenance.
5. Social (supported by Annex 8): The project area of influence includes the agricultural regions of the country with the best prospects for developing crops which could replace coca as a major source of export income. The United States and other Governments are fully supporting a program to help farms switch from growing coca to other alternative products. By providing outlets to export markets, the project would provide incentives for the poor rural farmers to replace coca by non-traditional export crops. The project would also provide short-term employment during construction and through small contracts for maintenance works once in operation.
As part of the Environmental Impact Assessment, a social impact assessment was carried out. The assessment focused on the direct impacts on families that will need to be resettled and the potential indirect impacts on indigenous communities in the project's area of influence. Consultations with civil society representatives took place during the assessment process. During the consultations widespread support for the project was found and the potential positive and negative social impacts were discussed with the participants. The social assessment resulted in three specific action plans aimed at avoiding and/or mitigating possible negative impacts and enhancing access to the expected benefits of the project: (i) resettlement plan; (ii) indigenous peoples development plan; and (iii) community relations plan.
(i) Resettlement Plan
A total of 34 families would be resettled or relocated. Based on the degree of vulnerability, affected families would: (i) receive cash indemnification; (ii) be relocated within the same property; or (iii) be resettled to a new location in the vicinity. Among the families to be resettled, some have small shops. In this case, these families would also receive help to restore their economic activity. Also, there are about 92 small merchants and service providers that would not need to be resettled but their economic activities would be affected by the highway construction. For these families special cash compensations would be granted. SNC would be responsible for the general implementation and supervision of the resettlement plan. Some specific activities would be decentralized to either contractors or local governments. The resettlement plan would be launched before construction works begin and support to affected families would continue until the affected families have been satisfactorily reestablished. Page 17
(ii) Indigenous Peoples Development Plan
* Izozenio indigenous communities organized in three "Capitanias"(Kaaguasu, Kami and Charagua Norte) with a surface of about 455,000 Ha and 16,000 indigenous people live in the project's area of influence. Lack of regular transport has been a chronic feature contributing to the communities' poverty. Currently, indigenous communities in the area lack permanent and easy access to basic services and markets. The indigenous people see the road to El Espino as an effective solution to their problems. However, they are aware of the potential negative impacts the road may have in terms of opening their lands to colonization as well as the weakening of their social organization and culture. During the project preparation, several meetings were held with indigenous leaders from CABI and CIDOB (highly organized indigenous organizations representing the communities in the project area) as well as with the communities living in the project area of influence. In these meetings the potential impacts of the new road were discussed and an Indigenous Peoples Development Plan was agreed. The Plan comprises several activities ranging from support to land titling to bilingual education.
(iii) Community Relations Plan
* To facilitate communications and to avoid conflicts with the local community, a community relations plan was developed as a result of the assessment. Also, specific recommendations on location of workers' camps, workers' code of conduct and indemnification procedures for potential damages were introduced in the Environmental Management Plan. The community relations plan involves: (i) the establishment of a civil society consultative committee, (ii) procedures and mechanisms for information dissemination and community access to project management and; (iii) support to local governments for urban planning initiatives.
6. Environmental Assessment: Environmental Category []A [X] B []C (Supported by Annex 8) The proposed highway reconstruction and paving will follow the existing gravel road alignment for the most part in an area of the southern part of the Santa Cruz Department where the natural vegetation has already been widely cleared. Direct environmental impacts will be road widening and realignment that may be required in some sectors, which may cause the resettlement of a small number of dwellers (see previous paragraph). Direct impacts on vegetation and fauna will be minimal, as most areas have long been deforested and local fauna has been driven to more remote areas. Erosion control and embankment stability will be needed in some segments as the road crosses mountain range. Indigenous populations are mainly settled in areas over 30 km from the road, though some do live close to the access road to El Espino. Indirect impacts on these indigenous populations are expected to be minimal.
Additional pressures on natural resources (logging, colonization) are also expected to be small. There are no critical natural habitats. The area has no known archaeological sites and the potential for chance findings is low. Local expectations towards this project are quite high specially among the indigenous communities. These communities want improved access to Santa Cruz for their products.
Based on the Environmental Impact Assessment, a detailed environmental management plan was prepared for all road segments and by-passes. A summary of the EIA and environmental management plan is presented in Annex 8. The plan includes: (i) specific erosion and stability measures along the entire road segments, which have been included in engineering designs and budgets; (ii) a community information and consultation program, which includes technical assistance to rural municipalities to deal with land use planning, road safety, and re-ordering of economic activities along road by-passes; Page 18
(iii) a detailed set of environmental specifications for contractors, including explicit environmental behavior guidelines for workers, restrictions regarding camp locations near rural communities and procedures for chance findings of archaeological sites. Compliance with these specifications will be enforced by an environmental supervision team within the technical supervision arrangements; (iv) a resettlement plan (see Annex 8); and (v) an indigenous peoples' development plan, which includes measures to avoid major impacts from having a major international road traversing their lands, and support to on-going initiatives for land titling, commercialization and bilingual education.
This plan includes a detailed schedule for implementation, institutional arrangements, and budget.
Environmental management capacity in SNC is being strengthened through the on-going Road Maintenance Project. The proposed reorganization of SNC (starting January 1999) will upgrade SNC's existing environmental unit to a higher hierarchical status within the organization reporting to the SNC's Deputy Director. The project will provide additional support to SNC to strengthen environmental management capabilities.
7. Participatory Approach: a. Primary beneficiaries and other affected groups: The primary beneficiaries would be the direct road users of medium and long distance of the main export corridor whom would benefit from improved transport services, better safety, and improved access to new export centers.
Indigenous populations are mainly settled in areas over 30 km. from the road. The extension to El Espino will provide access to the regional markets for the indigenous communities and will be financed by the credit as a contribution of the project to the development of those communities. The indigenous communitiesare well aware of the project and have been alerted to its potential impacts from its conception. They are most interested in the construction of the road to facilitate their access to markets. This interest has been confirmed by representatives (Capitanes Grandes) of the Kaaguasu, Kami, Charagua Norte and Upper and Lower Izozog communities, who officially requested that the construction of the road go through El Espino, and also by the identification mission in informal meetings with the corregidor (the mayor) of the community of El Espino b. Other key stakeholders: Other stakeholders are large land owners, menonite communities, local governments and chambers of commerce in the largest towns served by the road. All these actors have participated in a series of consultations that took place during project preparation as part of the EIA process. During these consultations, IDA missions cautioned the indigenous communities about some of the potential negative impacts if the Abap6-Camiri highway were to pass near El Espino, due to the potential risk of colonization and encroachment, and emphasized the importance of land titling as a mechanism to prevent colonization. It was agreed that permanent consultation with CABI and CIDOB, as well as with the local communities and their leaders, would be essential to ensure that they were well aware and participated in the assessment of project alternatives and the design of appropriate measures to ensure that the indigenous communities would get all the benefits of the upgraded road.
F: Sustainability and Risks 1. Sustainability: The sustainability of the project's physical investments is dependent on the quality of the initial construction and adequate funding for future routine and periodic maintenance. The use of independent consultants for Page 19 construction supervision, technical audits and regular IDA supervision missions will help ensure quality control.
The government is taking a three-prong approach to improving project sustainability: (i) clarifying and strengthening the roles of the VMT, SNC and the SDCs; (ii) developing strategies to enhance road sector funding and other maintenance policies; and (iii) developing a viable investment program (including maintenance) to further reduce transport costs.
* After the institutional changes generated by the decentralization process, in which several agencies were in charge of various aspects of the transport sector, the clarification of roles and strengthening of these institutions was considered critical. The new SNC, a reorganized autonomous national entity, must plan, supervise and enforce maintenance activities at the national level. In addition, SNC must lead the coordination and monitor the implementation of technical assistance programs at sub-national level. To achieve this, the government has recentralized the national network to supplement actions already taken to revisit the institutional framework and devise ways to make it work.
* To strengthen the road sector funding and axle load control policies, actions are already being taken under the on-going SRMP. These actions entail ensuring that the resources generated by road user charges are reinvested in the road network so that its deterioration is stopped in time to prevent higher vehicle operating costs and higher rehabilitation costs in the future. The new decentralized scheme requires fiscal discipline to enforce adequate maintenance of the network. The new decree establishes that 70% of the tolls collected on the roads should be spent on maintaining the main network and 30% on maintaining the secondary network maintenance, but there is a need to ensure compliance and to generate additional funds to cover the gap, so far financed by Treasury funds.
- IDB is financing the Government's initiatives to develop a transport master plan to define priorities for the transport sector in the medium term. The objective is to continue to rehabilitate the national network and construct key missing links along the main export and integration corridors in the country. In addition to seeking international financing, the government has started to explore the possibilities, however limited due to the low traffic levels, of incorporating the private sector into the financing and operation of road investments.
* To complement the preparation of the master plan, SNC together with the SDCs should prepare a comprehensive maintenance program with time-slice targets. This would be complemented with institutional building programs to ensure: (a) the mechanisms developed under the Export Corridor Project and the SRMP are implemented; and (b) the progress achieved under the SRMP in the management of the national road network is effectively sustained. (These efforts would include the elimination of force account for non-routine or emergency activities in the departments). Furthermore, maintenance to be carried out by contract would take advantage of existing small local contractors. It was considered prudent that a program to test comprehensive maintenance by contract be included in the proposed project for part of the Santa Cruz Department national network before it is adopted for the entire national network.
The sustainability of the decentralization process in the road sub-sector will be further improved by helping build partnership between SNC and the SDCs. This requires SNC to make its pool of experts available to the SDCs and for the latter, to accept the role of SNC. These aspects are being addressed under the on-going SRMP to further advance this agenda of reforms. Page 20
2. Critical Risks (reflecting assumptions in the fourth column of Annex 1):
Risk Risk Rating Risk Minimization Measure
Annex 1, cell "from Outputs to Objective
Delays in completion of civil works in the N The reconstruction and paving of the Abap6- Trinidad-Yacuiba corridor. Camiri section is the only one not yet started in the entire corridor. The civil works of this section will be executed by international and/or national contractors. The experience with the construction of other sections in the same and other corridors has been satisfactory.
SNC's lack of management experience with M The program and the methodology to be used in private sector participation in road the program of comprehensive maintenance by maintenance. contract has been prepared by consultants with experience in other countries. The program itself includes advice for its implementation.
The road maintenance account is not M The new decree that establishes the road implemented yet and there is a chance that maintenance account has already been approved there will not be sufficient funds for road and the account opened. It proves that there is a maintenance. strong commitment by the Government to ensure a satisfactory financing mechanism for road maintenance.
A legal and regulatory framework for road M The law for concessions of transport public works concessions has not been established and the has been already approved by Congress. IDB is bylaws for its implementation are not financing the preparation of the legal and expected to be ready in early 1999. regulatory framework for road concessions. The project includes technical assistance to carry out a feasibility study for the Santa Cruz - Puerto Suarez highway initiative.
Risk Risk Rating Risk Minimization Measure
Annex 1, cell "from Components to Outputs"
Delays in the final design for civil works. N Engineering designs have been completed by a consulting firm contracted by SNC and financed by FONPLATA.
The land acquisition and resettlement plans N A land acquisition and resettlement plan in are not prepared on time. accordance with the engineering designs, and satisfactory to IDA has been completed.
Delays in the "Declaratoria Ambiental' given N An environmental assessment has been prepared by the Ministry of Sustainable Development by the same consultants and under the same and Environment. contract for the engineering designs. According to the Bolivian Environmental Law, the Ministry of Sustainable Development and Environment will Page 21
Risk Risk Rating Risk MinimizationMeasure
issue the "DeclaratoriaAmbientar'.
Delays in availability of counterpart funds M It is importantto ensurethat the counterpartfunds during implementation. In particular the are availableon time. Particularlythe financial funds to be providedby the Prefecturas. resourcesneeded for the first year of imnplementation(1999). IDA requiredthe GOB to includein the National TreasuryBudget the counterpartresources needed for 1999. Overall Risk Rating M Risk Rating- H (High Risk), S (SubstantialRisk), M (ModestRisk), N (Negligibleor Low Risk)
This is the fourth IDAIIBRD-financed road project in Bolivia. It has been prepared on the basis of lessons learned from the implementation of the ECP and the on-going SRMP. Under these two projects, institutional reforms have been and are being implemented. The problems created by the decentralization-recentralization are being addressed by the SRMP and the risks from the implementation and passage of the administrative decentralization law have been minimized with the approval of the Supreme Decree, which re-established the national road network and contributed to a better definition of SNC's roles and responsibilities.
There is a risk that the economic development objective, in contrast to the road improvement objective, will not be achieved. The development of non-traditional exports depends on a range of actions, not only on the building of a road, i.e. the GOB's actions to promote non-traditional exports and curtail the production of coca. The GOB is taking satisfactory actions to increase non-traditional exports. The project includes an analysis of the linkage between the development objective and the project economic rate of return. The analysis shows that, if the development of non-traditional exports in the Chapare area does not occur, the rate of return of the highway component would be reduced from 19.1% to 18.6%, which is not a significant difference.
The risk of delays in starting the physical works is being addressed by SNC's ensuring that the following actions are taken before project negotiations: (i) prequalifying bidders for the civil works of construction and starting the prequalification process for the comprehensive maintenance component; and (ii) completing the plan to start the acquisition of land for the right-of-way, and resettlement in accordance with the engineering designs already prepared.
The main remaining risk is delay in bid awarding and contract signature, and cost overruns. This risk is proposed to be addressed through intense supervision and continuous dialogue with the implementing agency.
Bank-wide experience also shows that there is risk of over-estimating traffic growth, which is a key assumption in estimating the project benefits. The economic evaluation of this project has considered scenarios with low traffic growth, low generation of traffic and cost overruns (see Section E above).
3. Possible ControversialAspects: The only controversial aspect of the project concerned the two design alternatives considered at the beginning of project preparation, mentioned in section D. The first alternative was to upgrade the original road, and, additionally, rebuild and pave the existing access road to El Espino. The second alternative assumed that the proposed road would not follow the original route but would include a diversion through El Espino - Ipita. This controversy was solved during the follow-up mission in June 1998 in the way described in Section D. Page 22
G: Main Loan Conditions 1. Conditionsfor ProjectApproval and Effectiveness-: The four conditions for project approval have been met. There will be no specific conditions for project effectiveness. 2. Other: (i) The Borrower shall carry out, through SNC, the Environmental and Social Management Plan, in accordance with its terms.
(ii) The GOB shall, open and thereafter maintain, until the completion of the Project, a Fiscal Account, under the terms and conditions satisfactory to IDA, for the purposes of managing all funds required to make payments in Bolivianos under contracts to be financed out of the proceeds of the Credit;
(iii) The Borrower shall maintain or adjust road user charges at the level required to allocate each Fiscal Year, as a minimum, the amounts for routine maintenance set forth in the Monitoring Indicators and Targets for each such Year.
(iv) SNC will consult with IDA before making any commitment under the project, if final designs of subprojects have resulted in cost estimates exceeding 20% (in US$ equivalent) those of the estimated original costs as approved by IDA.
(v) SNC, shall:
(a) not later than September 30 of each year of project implementation, furnish to IDA a report, containing: (i) information on: (A) the overall progress in the execution of the Project; and (B) the implementation of the SNC Reorganization Plan, both for the immediately preceding semester; and (ii) proposals for: (A) a highway investment and maintenance program; and (B) a training program for the institutional strengthening component of the Project, both for the upcoming Fiscal Year;
(b) not later than March 31 of each year of project implementation, furnish to IDA, a report, on: (i) (A) the overall progress in the execution of the Project, including an evaluation on the basis of the Monitoring Indicators and Targets; and (B) the implementation of the Reorganization Plan, both for the immediately preceding semester; and (ii) the implementation of the highway investment and maintenance program in the previous Fiscal Year,
(c) review with IDA, not later than November 30 and May 31 of each year of Project implementation, starting in May 31, 2000, the immediately preceding reports and proposals referred to in paragraphs (a) and (b) of this Section.
(vi) The Borrower, through SNC, shall carry out the Reorganization Plan as approved by IDA.
(vii) The Borrower shall not initiate any civil works under Parts A, B and C of the Project until the resettlement of the families affected by such civil works has been completed, to the satisfaction of IDA, in accordance with the Environmental and Social Management Plan.
(viii) SNC will carry out a time-bound action plan acceptable to the Association for the strengthening of its financial management system for the Project in order to enable the borrower and SNC, not later than twelve (12) months after the Effective Date, to prepare quarterly Project management reports, acceptable to IDA. Page 23
H. Readiness for Implementation
[X] The engineeringdesign documentsare completeand ready for the start of project implementation. [X] The procurement documents for the first year's activities are complete and ready for the start of project implementation. [X] The Project ImplementationPlan has been appraised and found to be realistic and of satisfactory quality.
I. Compliance with Bank Policies
[XI This project complieswith all applicabl IDA policies.
Task Team Leader/TaskManager: Jose o so-Biarge
SectorManager/Director: D
Country Manager/Director: Isabel Guerrero Page 24
Annex 1
Abap6 - Camiri Highway Project (ACA-HP)
Project Design Summary
Narrative Summary Key Performance Monitoring and Critical Assumptions Indicators Evaluation Sector-related CAS (Goal to Bank Mission) Goal: Freight volumes * Traffic statistics Allocation of sufficient funds to complete Foster economic between Santa Cruz and between Santa Cruz construction of the remaining integration development of Bolivia Yacuiba increased by and Yacuiba. corridors with the construction and 20%. * Cooperation between maintenance of the export SNC and SDCs. corridor Trinidad- * Road network Yacuiba. statistics. ProjectDevelopment (Objectiveto Goal) Objective:
To promote export Year-round good * No traffic There are no delays in completion of civil opportunities and regional condition for all interruptions due to works in the Trinidad-Yacuiba corridor. development. sections of the corridor severe weather; and connected ones, SNC has the institutional capacity to Strengthen the including secondary * Road Statistics; effectively manage private sector institutional capacity of roads participation in road maintenance. the public sector and also * Capacity evaluations; promote private sector Maintenance by The Road Maintenance Account is participation in the road contract extended to the * National road network implemented, thus providing adequate maintenance industry. whole national network maintained by financing for routine road maintenance. and installed capacity to contract. implement road Legal and regulatory framework for road concessions. concessions is implemented. Outputs: (Outputsto Objective)
1. 152 kms of high- 1.1 Traffic volumes in * Records on traffic SNC's acquires management experience standard, two-lane the corridor increased volumes and speeds; with private sector participation in road highway between Abap6 by 80% above the maintenance; and Camiri; current average 250 * Road usage surveys vehicles per day; performed by SNC; The road maintenance account is implemented and there will be sufficient 1.2 Vehicle operating * Vehicle operation funds for road maintenance; costs reduced by 50% costs analysis by SNC; of 1997 costs; A legal and regulatory framework for * Technical audits; road concessions program has been 1.3 Transportation costs established and the bylaws for its reduced by 20-30%; * Good condition of implementation are ready in 1999. roads connected to the 1.4 Average travel time corridor. Budget between Abap6 and allocations to Camiri reduced by 3 maintenance. hours;
2. Maintenance of the 2.1 Contract Program * Semi-annual reports whole national road for Comprehensive onSNC does the contracting out of network, contracted out Maintenance signed and implementation; comprehensive road maintenance by SNC; working; component on time. Page 25
Narrative Summary Key Performance Monitoring and Critical Assumptions Indicators Evaluation 2.2 Plan for SNC Institutional Capacity . Progress Reports; Strengthening developed and under * Consultant's implementation; evaluation;
3. Completion of the 3.1 Legal and fiscal * Legal information; feasibility study for the framework for Santa Cruz - Puerto concessions established * Technical reports and Suarez concession and working; contract traffic statistics. initiative; for consulting services signed and study progressing
4. The local communities 4.1 Access for rural have access to markets communities provided through rural roads. by secondary roads rehabilitation.
Project Inputs: (budget for (Components to Outputs) Components/Sub- each component) components: (see Annex 2 for project description)
A. Abap6-Camiri US$97.3 million * Highway construction There are no substantial changes in the Highway starting and final design of civil works; Construction and paving progressing as planned of the Abap6 - Camiri in the PIP; Land acquisition and titling program is highway of 152 km. The not delayed for extemal/political reasons; indicative cost includes: & Technical assistance * direct costs, according to the Ministry of Sustainable Development and . physical and price projections in the PIP. Planning issues the "Declaratoria contingencies, and Ambiental" in due time; . supervision. The road will be split in No delays on availability of counterpart the following segments: funds during implementation from the central and departmental governments. (a) New bridge (420 m) 4.9 over the Rio Grande in Abap6 including accesses (0.44 km)
(b) Abap6-Ipita (63.5 kmn) 40.3
(c) Ipita-Ipati (49 km) 30.1 including the by-pass of Gutierrez
(d) Ipati-Camiri (30.7 km) 16.6
(e) By-pass of Camiri (7.3 5.4 km). Construction and paving of a by-pass to avoid going through the town of Camiri. Page 26
Narrative Summary Key Performance Monitoring and Critical Assumptions Indicators Evaluation
B. Access Road to El US$8.5 million Espino(38 km) Construction and paving of an existing dirt road that runs parallel to the rail track to Charagua, a two-lane road of 6.0 m wide with two shoulders 0.5 m each, to provide access to the corridor for the indigenous communities.
C. Comprehensive US$12.2 million * Comprehensive No delays on availability of counterpart Maintenance by maintenance by funds during implementation from the Contract contract pilot program central and departmental governments. A program of commencing and comprehensive progressing as planned maintenance by contract in the PIP; for the period 1999-2003. The indicative cost of * Technical assistance this component includes according to the supervision and projections in the PIP. encompasses about 900 km of roads in the department of Santa Cruz.
D. "Institutional US$2.0 million Strengthening
Institutional strengthening of SNC and VMT through the provision of technical assistance for:
(a) Consulting services to:
(i) carry out a 0.1 feasibility study for the San Jose - Puerto Suarez highway concession initiative, (ii) strengthen and 0.1 operate the Project Coordinating Unit, SNC's Environmental Unit, and provide training to SNC, and (iii) prepare technical 0.1 and financial audits
(b) Acquisition of goods 0.1 Page 27
Narrative Summary Key Performance Monitoring and Critical Assumptions Indicators Evaluation (c) Routinemaintenance 0.2 program
(d) Implementationof the 1.4 ResettlementPlan, IndigenousPeople DevelopmentPlan, and the CommunityRelations Plan. Page 28
Annex 2
Abap6 - Camiri Highway Project (ACA-LIP)
Project Description
The proposed IDA credit would finance the reconstruction and paving of the 152 km Abap6-Camiri highway, which is the only missing section in the Trinidad-Yacuiba corridor to the border of Argentina that provides an outlet to the port of Rosario. This corridor would also give access to the regions between Santa Cruz and Cochabamba served by the East-West export corridor (between the borders of Brazil and Chile), including the Chapare region, where the coca plant is grown and is being replaced (under active support from the US government) by alternative crops, for which the natural market is Argentina.
The project consists of construction and paving of the existing road which is now in poor condition and will also include the construction of a new bridge over the Rio Grande of about 420 m. The road is currently a gravel road and offers good geometrical characteristics. However, it would need minor re-alignments and by-passes to avoid crossing small villages, resettlement and safety problems. The road would be strengthened to fully accommodate growth in export traffic. Realignments and reconstruction works would meet the geometrical and structural standard conditions established for national roads in Bolivia, under which the Santa Cruz-Abap6 and Camiri- Yacuiba sections were reconstructed. The upgraded highway, together with the rehabilitation of the existing access road of 38 km to El Espino, will serve the poorest communities of the region to transport the agricultural products to consumption centers. Land acquisition and people re-location, if necessary, will be financed by the Bolivian Government under a plan satisfactory to IDA. The engineering studies are already completed for Abap6-Camiri highway, the access road to El Espino, the bridge over the Grande river and the Camiri by-pass. The project would also include a program of comprehensive maintenance by contract for the period 1999-2003. The objective would be to ensure that the remaining corridor and the roads complementing it, will be in good condition when the project is completed.
Project Component A. Abap6-Camiri Highway - US$97.3 million (total cost of component). The proposed credit would finance 80% of the total cost for civil works and supervision.
The reconstruction and paving of the Abap6 - Camiri highway of 152 km. A two-lane road of 7.3 m wide with two shoulders 1.5 to 2.0 m each (depending on terrain characteristics), fully paved and re-aligned. The indicative costs include: * direct costs, * physical and price contingencies, and * supervision.
Geometrical design is based on the SNC guidelines for Road Category II. The design parameters used are presented in the following table: Page 29
DesignParameters | Symbol Unit Terrain Plane Hilly Mountaino us Vehicle speed S Kinh 80 60 40 Minimumradius for circularcurve Rmin m 229 123 47 Lateral friction factor F 0.14 0.15 0.17 Maximum radius requiring superelevation m 3,200 2,300 1,400 Maximum radius requiring transition curves m 550 300 130 Roadwaywidth (2 lanes of 3.65 m each) m 7.3 7.3 7.3 Shoulder width m 2 2 1.5 Extra width in horizontal curves EW m 0.5 0.8 1.6 Minimumtransition curve length Le m 58 49 50 Minimumsuperelevation in circularcurve E %8 8 10 Lateralslope of roadway B % 2.5 2.5 2.5 Lateralslope of shoulders %3 3 3 Maximumlongitudinal slope M % 5 6 8 Minimumlongitudinal slope in cuts % 0.5 0.5 0.5 Minimum longitudinal slope in fills % 0.3 0.3 0.3 Longitudinalfriction coefficient Fl 0.3 0.33 0.37 Minimumstopping distance Sd m 137 85 45 Minimumpassing distance Pd m 565 377 214 Convexvertical curveparameter K 40 15 4 Concavevertical curveparameter K 32 17 7
The changes in road alignment will allow a speed of 40-60 km/h in the hilly and mountainous terrain, and 80 km/h in the plane terrain. The estimated construction time is 30 months. In all sections, vertical and horizontal traffic signs will be part of the project.
Costs. Four project paving alternatives were considered: (i) asphalt concrete, (ii) double surface treatment, (iii) simple surface treatment, and (iv) gravel. Based on the analysis of the estimated costs for the 3 road sections and the bridge over the Rio Grande, the asphalt concrete alternative was finally selected.
Road sections. The road will be split in the following segments:
(a) Bridge over the Rio Grande in Abap6 vicinity, including accesses. [US$4.9 million] (420 m. span and 440 m. of accesses). Estimated time of construction: 24 months.
The proposed bridge is located in the progressive 0+127 in the Abapo - Ipita Section, in the Abapo vicinity, and approximately 200 m apart from the existing railroad bridge. The bridge (420 m span) will have a total width of 10.6 m, with two lanes of 8 m total width each, and two sidewalks of 1.3 m each side. Its superstructure will be divided in two sections: (i) the first 60 m will be a two consecutive sections, with beams of 30 m long and 1.6 m height, and a 20 cm reinforced concrete slab; and (ii) the remaining 360 m will be a continuous prestressed concrete structure composed by five sections: two 51 m long on each end and three intermediate 86 m long sections. The bridge will be constructed using the balanced cantilever segmental construction method and with a variable rectangular cross section (box girder of variable height). Its substructure will have two abutments and six reinforced concrete piers of different heights, ranging from 9 to 14 m, with foundations of 1.2 m diameter reinforced concrete piles. The bridge accesses of approximately 600 m will be included in the bridge construction contract. Page 30
(b) Abapo-Ipita. [US$40.3 million] (63.5 km.). Estimated time of construction: 30 months.
Along this section of approximately 63.5 km long, there are several private properties on both sides. In some parts, its topography is mountainous, it goes across many small rivers, and passes by the Opabusu lagoon near the Tatarenda Village.
There are 3 different sections: (i) the first section, of approximately 40 km located between Ipita and El Limon ranch, has the terrain mostly plane; (ii) the second section of about 10 km from El Limon ranch to El Algodonal ranch has a marked mountainous characteristics, and (iii) the third section of approximately 14 km between El Algodonal and the Abap6 village presents a mixed plane-rolling topography.
The alignment goes through the existing dirt road and runs largely parallel to an oil pipeline. In this section there are no bridges or other significant additional structures.
In this part of the road there are no towns or important concentrations of population. The communities of Caraguatarenda, Tatarenda, Tatarenda La Vieja and Ipaticito del Monte are located closer to IpitAwhere there is potential to develop agricultural activities.
(c) Ipita-Ipati including the Gutierrez by-pass. [US$30.1 million] (49 km). Estimated time of construction: 30 months.
In this section of approximately 50 km, the road goes through a cattle raising area, along the Pipirenda sierra where the town of Gutierrez is located and, after the Las Frias hill and a small community called La Herradura, the road reaches Ipati. Along the existing road there are many ranches and small communities for whom agriculture is their main activity. Ipati is the point in which the so called Diagonal Jaime Mendoza (that comes form the Chuquisaca department) links with the Santa Cruz - Yacuiba export corridor. For this reason it is a must that the road passes through Ipati.
In the first section of approximately 50 km, the terrain presents mostly rolling topography; and in some sectors a mixed plane-rolling topography.
(d) Ipati-Camiri. [US$16.6 million] (30.7 km). Estimated time of construction: 24 months.
In this section of approximately 30 km, a higher traffic volume exists (compared with the other sections) mainly due to its proximity to the town of Camiri. A large part of the traffic flow is generated by heavy trucks transporting cattle, diesel, wood and many other commercial trade products between Bolivia and Argentina.
In this section the road crosses the Urundaiti river several times and 4 bridges have been designed for this purpose.
In this part of the road there are no adequate materials to construct the pavement structure, and the alternative of providing these materials from the Parapeti and Grande rivers (located in the project extremes) is being considered.
The Itacua, Yrenda and Choreti as well as many ranches whose main activities are cattle raising and maize production are located in this section. The commercial and industrial activities are concentrated in the city of Camiri . Page 31
In this section the terrain presents mostly rolling topography.
(e) By-pass of Camiri. [US$5.4 million] (total cost). (7.3 km). Estimated time of construction: 18 months.
The 7.3 km by-pass to avoid going through the town of Camiri has the same design standard of all the other sections of the Abap6 - Caminrihighway. Its main objective is to provide a direct and safer connection between the end of the Ipati - Camiri section of the proposed highway, and the Camiri - Yacuiba paved road. It will directly benefit the long distance traffic of the Santa Cruz - Yacuiba export corridor. Presently the traffic goes through Camiri and interferes with the local transit of vehicles as well as pedestrians, and other urban activities.
Three alternatives were considered: first, the existing one that goes through the town, a second one around the town which would generate the same problem in the short run (5-7 years); and the third alternative that goes beyond the urban development plans. The last was selected, being the one with the least resettlement and expropriation needs and minimum negative impact for Camiri.
Project ComponentB. Access Road to El Espino (38 km) - US$8.5 million (total cost of component). The proposed credit would finance 80% of the total cost for civil works and supervision. Estimated time of construction: 18 months.
The project consists of the reconstruction and paving of an existing dirt road that runs parallel to the rail track to Charagua. Its main objective will be to provide safe and permanent access to Abap6 and Santa Cruz (the consumption center) for the indigenous communities located along the road and to promote greater economic activities in the area of influence through transport costs reduction. The road is currently a dirt road in poor condition but with good geometrical characteristics that would require only minor re-alignments. The indicative cost includes: * direct costs, * physical and price contingencies, and * supervision.
This road passes by the following villages and reference points: Puerto Viejo (km 4), first railroad cross section (km 5.3), Tacovo station (km 13.2), Nuevo Muchuri station (km 27), second railroad cross section (km 34), access to El Espino Viejo and the Itani stream (km 38). The topography is mostly plane with smooth slopes of a maximum of 2%. There is a need for a small bridge (20-30 m long) to cross the El Limon stream.
The geometrical design for the 38 km access road is based on the SNC guidelines and the following parameters.
Design Parameters Symbol Unit Terrain Plane Hilly Mountainous Vehiclespeed S Kni/h 80 60 40 Minimumradius for circularcurve Rmin i 229 121 47 Lateral friction factor F 0.14 0.15 0.17 Maximumradius requiring superelevation m 3,350 2,200 1,300 Maximumradius requiring transition curves rn 550 300 130
Roadway width (2 lanes of 3.0 m each) _ 6.0 6.0 6.0 Shoulderwidth m 0.5 0.5 0.5 Extra width in horizontalcurves Ew i 0.52 0.81 1.63 Minimumtransition curve length Le m 60 51 41 Maximumsuperelevation in circularcurve E % 8 8 10 Page 32
Design Parameters Symbol Unit Terrain Plane Hilly Mountainous
Lateral slope of roadway B % 2.5 2.5 2.5 Lateral slope of shoulders %__2.5 2.5 2.5 Maximnum longitudinal slope M %/ 4 5 7 Minimum longitudinal slope in cuts 0 0.5 0.5 0.5 Minimum longitudinal slope in fills % 033 0.33 0.33 Longitudinal friction coefficient Fl 0.31 0.33 0.37 Minimum Stopping Distance Sd m 165 98 51 MinimnumPassing Distance Pd m 562 375 213 Convex vertical curve Parameter K 40 15 4 Concave vertical curve Parameter K 32 17 7
Four alternative types of surface layers were considered and based on the economic and financial evaluation it is recommended the construction with a double surface treatment. In all sections, vertical and horizontal traffic signs will be part of the project.
Project Component C. Comprehensive Maintenance by Contract - US$12.2 million (Total cost of the component). The proposed credit would finance 20% of civil works, and 80% of supervision.
The project includes a comprehensive maintenance program, covering about 900 km of the basic highway network of the Departamento de Santa Cruz. Its components are roads of the national main network which feed the Abap6-Camiri highway (see Table below). The terrn "comprehensive maintenance" includes not only routine and periodic maintenance, but also user and maintenance management services, including emergency coverage.
Table. Comprehensive Maintenance by Contract Program Routes Length Width Traffic Condition Cost * Route Start End (km) (m) Surface (ADT) Rating (US$000) 0004 Yapacani GuabirA 70.1 7.1 A.C. 2171 4 650.2 0004 GuabirA Warnes 27.2 7.8 A.C. 4794 3 & 4 211.5 0004 Warnes Sta. Cruz 26.0 12.0 A.C. 4258 3 & 4 318.8 0010 Okinawa GuabirA 41.1 6.2 A.C. 665 4 & 5 176.7 0009 San Ramon Los Troncos 54.2 7.3 S.T. 570 3 & 4 601.6 0010 Los Troncos Okinawa 30.7 8.5 Gravel 247 2 & 3 433.2 0004 Sta. Cruz Cotoca 14.6 7.3 A.C. 6560 4 167.4 0004 Cotoca Pto. Pailas 28.7 6.7 A.C. 5876 3 & 4 436.6 0004 Pto. Pailas Pail6n 14.5 6.6 S.T. 500 2 & 3 401.2 0009 Pail6n Los Troncos 62.1 7.3 S.T. 570 2 & 3 380.9 0007 Mairana Angostura 79.1 6.1 A.C. 644 2 & 3 & 4 1,683.4 0007 Angostura La Guardia 36.5 5.8 A.C. 1302 3 544.7 0009 Abap6 Km 13 125.8 7.5 A.C. 276 4 1,400.1 0006 Camiri Boyuibe 60.6 7.3 S.T. 175 2 & 3 2,262.1 0006 Yacuiba Boyuibe 184.1 7.3 S.T. 175 2 & 3 1,455.0 0006 Ipati Incahuasi 38.4 6.0 Earth 53 1 & 2 294.8 TOTAL 893.7 km TOTAL COST 11,418.2 Supervision 811.8 TOTAL COMPONENT 12,230.0 Condition 1: POOR Condition 3: REGULAR Condition 5: GOOD Page 33
Notes: A.C. Asphalt Concrete. S.T.: Surface Treatment.
*Includes physical and price contingencies
The contract shall be of three years' duration, and its activities are grouped as follows: (i) routine maintenance: operations that should be programmed and performed at least once a year; (ii) periodic maintenance: operations that can be planned for and which must be carried out periodically, normally for periods exceeding one year, to ensure the adequacy of the conditions of the highways. Given the deficiencies presented by some of the sections of the contract's roads, a series of priority actions to be carried out in the first year of the contract will be decided upon; (iii) emergency coverage: unforeseeable and occasional actions which must usually be carried out immediately after noticed to restore the flow of traffic or to guarantee normal driving conditions; (iv) minor works: occasional activities aimed at correcting deficiencies or improving certain parts of the highway; (v) works management: all those tasks required to plan, monitor and document the execution and evaluation of the work and activities carried out; and (vi) training in comprehensive maintenance activities for maintenance professionals and specialists of the public and private sectors.
Project Component D. Institutional Strengthening - US$2.0 million (total cost of the component).
The project has also an institutional strengthening component for SNC and VMT to provide technical assistance for:
(a) Consulting services to:
(i) carry out a feasibilitystudy for the San Jose - Puerto Suarez highwayconcession initiative, (ii) strengthen and operate the Project Coordinating Unit, SNC's Environmental Unit, and provide training to SNC, and (iii) prepare technical and financial audits
(b) Acquisition of goods
(c) Routine maintenance program
(d) Implementation of the Resettlement Plan, Indigenous People Development Plan, and the Community Relations Plan.
The proposed credit would finance: 100% of consultants and services for (a); 80% of goods and equipment for (b); 20% of maintenance works for (c), and 0% of the Plans in (d). Page 34
Annex 3
Abap6 - Camiri Highway Project (ACA-BIP)
Estimated Project Costs
Project Component Local Foreign Total ------US $ million------A. Abap6-Camiri Highway 46.4 36.4 82.8 B. Access Road to El Espino 3.8 3.5 7.3 C. Comprehensive Maintenance by Contract 4.6 5.6 10.2 D. Institutional Strengthening 1.6 0.4 2.0 E. Supervision Contracts 2.0 4.7 6.7
Total 58.4 50.6 109.0
Total Baseline Cost Physical Contingencies 4.4 3.6 8.0 Price Contingencies 1.6 1.4 3.0
Total Project Cost 64.4 55.6 120.0 Page 35
Annex 4
Bolivia: Abap6 - Camiri Highway Project
Cost-Benefit Analysis Summary
Net Economic Benefits (NPV) at 12% Discount Rate (M$) Users 128.5 Agency -72.5 Project 56.0
Economic Internal Rate of Return (EIRR) in percent Project 19.1
Project Components
A cost-benefit analysis was done for the civil works being financed under the project, which represent 95 percent of the project costs and consists of: (i) upgrading the Abap6 - Camiri road, including the Bridge over Rio Grande; (ii) upgrading the access road to El Espino; and (iii) a road maintenance program in the project area. The current Abap6 - Camiri road was subdivided into four sections (Abap6 - IpitAroad, Ipita - Ipati road, Ipati - Camiri road, and Camiri bypass), based on traffic and paving cost considerations, which were evaluated independently. The following table presents the evaluated project components.
Component Activity Length(km) FinancialBase Cost (M US$) Abap6- IpitARoad * Upgrading 64.4 38.5 IpitA- Ipati Road Upgrading 49.0 25.5 Ipati - CamiriRoad Upgrading 30.7 14.3 CamiriBypass Road Upgrading 7.3 4.6 Accessroad to El Espino Upgrading 38.0 7.2 Road MaintenanceProgram Maintenance 893.7 10.2 Total 1,083.1 100.3 * Includesthe Bridge over Rio Grande
The Abapo - Ipita road starts at the end of the Santa Cruz -Abap6 paved road, crosses the Rio Grande River, and ends in the town of Ipita. The Ipita - Ipati and Ipati - Camiri roads connect the towns of Ipita and Ipati and the perimeter of the town of Camiri. The Camiri bypass road connects the Ipati - Camiri road with the end of the Camiri - Yacuiba paved road bypassing the town of Camiri. The access road to El Espino, not being part of the Santa Cruz - Yacuiba corridor, connects the town of Abap6, and Santa Cruz, with the town of El Espino to provide an all weather access to the indigenous communities of El Espino and Charagua.
Project Main Objectives and Benefits
The project main objective is to reduce road transport costs on the Santa Cruz - Yacuiba corridor and maintain the road network in the area in an efficient and sustainable manner. The investments will: (i) reduce road user transport costs by lowering vehicle operating, accident, and travel time costs; (ii) remove physical constraints to international road transport of goods and people in the region; and (iii) allow for the provision of more reliable and safer transport services. Page 36
The Santa Cruz - Yacuiba export corridor (561.0 km connecting Santa Cruz with the border with Argentina at Yacuiba) is considered a national priority because it connects important agricultural and cattle areas in the departments of Santa Cruz, Chuquisaca, and Tarija as well it is an international corridor by connecting extensive areas of the country with Argentina and, in the future, Paraguay. At the moment, the section of the Santa Cruz - Yacuiba corridor that has not yet been paved is the Abap6 - Camiri section (152 km) which is in very bad condition due to lack of maintenance and the fact that heavy traffic has increased in recent years due to the upgrading of other sections of the corridor.
The Abapo - Camiri highway project has two complementary functions: (i) to drive the economic development of existing agricultural areas in the Chapare region in Cochabamba, the southern region of Beni, and northern part of Santa Cruz that will have better access to markets, and (ii) to improve the integration and interconnection of the Bolivian road network and the export corridors. The Abap6 - Camiri highway is part of the North - South corridor of South America, connecting Santa Cruz and Buenos Aires; at the town of Ipati it joins with National Route No 6 that goes to the departments of Chuquisaca and Potosi through important cities such as Sucre, Padilla, Monteagudo, and Muyupamapa; and at the town of Ipita it connects to Route 501 that goes to the Vallegrande region.
The objective of upgrading the access road to El Espino is to: (i) provide safe and permanent access to Abap6 and Santa Cruz for the indigenous communities in the area of influence of the project, and (ii) to promote greater economic activities in that area, which has a high potential due to the flat terrain, climate, and availability of natural resources, by reducing road transport costs and ensuring all-weather access.
Main Assumptions
Net benefits were evaluated using the Highway Design and Maintenance Standard Model (HDM), which simulates life cycle conditions and costs and provides economic decision criteria for multiple road design alternatives.
The SNC estimated paving and maintenance costs in financial and economic terms (net of taxes and subsidies). Economic costs are on average 84 percent of financial costs for paving and 87 percent of financial costs for maintenance activities, based on applying the following conversion factors set by the Ministry of Finance in 1998 for the economic evaluation of Bolivian projects.
Item ConversionFactor SkilledLabor 0.440 UnskilledLabor 0.640 NationalMaterials and Equipment 0.840 ImportedMaterial and Equipment 0.886 Fuel 0.877
The table below presents representative maintenance costs obtained from the Maintenance Department of SNC. Activity FinancialCost EconomicCost UnpavedRoad Grading($/km) 109.6 95.4 UnpavedRoad SpotRegravelling ($/m3) 15.44 13.44 UnpavedRoad Regravelling ($/m3) 14.15 12.31 UnpavedRoad Routine Maintenance ($/km/year) 952 828 Paved RoadPatching ($/m2) 13.14 11.43 Paved Road DoubleSurface Treatment ($/m2) 4.54 3.95 Paved Road4 cm Overlay($/m2) 8.74 7.60 Paved Road RoutineMaintenance ($/km/year) 1138 990 Page 37
SNC also definedrepresentative vehicle fleet characteristicsand road user unit costs for six vehicle classes..With this information,the HDM model computedroad user costs with and without the project,economic road user costs being on average83 percent of financialcosts. The table below shows typical economicroad user costs as a fimutionof roughness,typical road user costs composition,and the vehicle fleet characteristicsand economicunit costs adopted in the analysis. The value of time was defined estimatingthat, on the area of influenceof the project,the averagehourly income is $ 1.63for car passengersand $ 0.72 for bus passengersand 85 of the passengersare on work relatedtrips. The value of leisuretime was set to 25 percent of the hourly income.
Car Pickup Bus Medium Heavy Articulated Truck Truck Truck Economic User Costs per Roughness ($/vehicle-km) Pavedroad, 2 IRI 0.20 0.29 0.92 0.42 0.67 0.99 Pavedroad, 4 IRI 0.21 0.31 0.93 0.47 0.71 1.05 Pavedroad, 6 IRI 0.23 0.34 0.97 0.50 0.79 1.15 Pavedroad, 8 IRI 0.26 0.39 1.02 0.56 0.88 1.26 Paved road, lOIRI 0.30 0.46 1.10 0.62 0.98 1.39 Unpavedroad, 18IRI 0.54 0.84 1.72 1.01 1.58 2.11 RoadUser Costs Composition for 2 IRI (percent) Fuel & Lubricants 16% 32% 14% 29% 25% 25% Tires 1% 2% 5% 7% 8% 8% Maintenance Parts & 18% 20% 12% 20% 29% 31% Labor Crew Time 0% 0% 3% 7% 4% 4% Depreciation & Interest 34% 24% 29% 37% 34% 32% Passenger Time 31% 22% 37% 0% 0% 0% Vehicle Fleet Characteristics and Economic Unit Costs Gross Vehicle Weight (t) 1.5 2.8 17.0 15.5 10.7 42.7 Standard Axle Load 0.0 0.0 3.9 2.7 4.6 5.3 Factor Number of Axles 2 2 2 2 2 5 Number of Tires 4 4 6 6 6 18 Number of Passengers 3 3 35 Service Life (y) 10 10 10 7 7 8 Hours Driven per Year 500 750 1000 1200 1280 1280 (h) Km Driven per year 30000 45000 55000 60000 64000 64000 (km) Interest Rate (%) 12 12 12 12 12 12 Vehicle Price ($) 14135 21079 107683 44924 83862 111182 Tire Price ($) 30.7 88.9 223.8 193.2 223.8 223.8 Maintenance Labor ($/h) 2.05 2.05 2.05 2.05 2.05 2.05 Crew Time ($/h) 0.00 0.00 2.00 1.41 1.54 1.86 Passenger Time ($/h) 1.45 1.45 0.64 0.00 0.00 0.00 Fuel Costs ($/1) 0.40 0.34 0.34 0.34 0.34 0.34 Lubricants Costs ($/1) 1.62 1.62 1.62 1.62 1.62 1.62
The normal traffic growth rate was defined based on recent GDP growth rate data (5.0 percent annual growth from 1988 to 1993 in Santa Cruz and 4.0 percent annual growth in Bolivia on the same period) collaborated by other statistics. Traffic growth rate was set for all vehicles to 5.0 percent for the period 1999-2010 and 4.0 percent for the period 2011- 2021, assuming conservatively a traffic growth elasticity to GDP growth of one and assuming that initially GDP will grow at a rate similar to the historic regional GDP growth Page 38 to finally stabilize at the historic national GDP growth. From 1992 to 1995, the annual growth of gasoline consumption was 4.8 percent for the districts of Santa Cruz, Camiri, Yacuiba, and Villamontes and the population annual growth rate of Santa Cruz was 4.2 percent. Historic traffic counts indicate that on the Santa Cruz - Abap6 and Abap6 - Camiri roads traffic has increased from 1984 to 1995 by around 90 percent corresponding to a 6 percent annual growth.
Upgrading Program
Each section to be upgraded under the project was evaluated, using the HDM model, with current data for existing road, traffic, vehicle fleet, and paving characteristics. To access the condition of the existing unpaved roads, a survey of speeds was undertaken in which the tags of vehicles passing
a control point were registered to determine their travel time to the next control point. Five control points were setup along the Abap6 - Camiri road, on average 37 km apart, and the following average travel speeds were obtained.
Vehicle Average Speed Number of (km/h) Observations Cars and Utilities 22 276 Buses 20 185 MediumTrucks 13 205 Heavy Trucks 11 449 ArticulatedTrucks 10 127
These average speeds include the time the vehicles stopped along the road for some reason and were measured at the end of the rainy season (March 1998), but not on a particular critical period, when the road condition is not as good as the dry season. Nevertheless, these measurements indicate the terrible condition of the existing road that is also substantiated by the IDA mission observations.
Traffic origin-destination surveys and traffic counts were undertaken during 7 days, 24 hours per day, at the exit of Abap6, at the exit of Camiri, and at the middle of the Ipita - Ipati section. The traffic data indicates that the section with highest traffic is Ipati - Camiri with 332 vehicles per day in 1997, followed by the Camiri bypass with 260 vehicles per day. The Abap6 - Ipita section has 221 vehicles per day and the intermediate section Ipita - Ipati has 208 vehicles per day, while the access road to El Espino has 32 vehicles per day. On average, 44 percent of the traffic is composed of trucks, 20 percent of buses, and 36 percent of cars and utilities. Traffic is well distributed over a 24-hour period, with 72 percent of the traffic travelling from 6 a.m. to 10 p.m..
Paving the roads, thus lowering transport costs, will generate some traffic that otherwise would not have used the road. For passenger vehicles and medium trucks a conservatively assumption of generated traffic due to lowering transport cost being 20 percent of normal traffic was adopted, considering that road user costs will decrease on average by 55 percent. For heavy trucks and articulated trucks, generated traffic will occur due to lower transport costs and the economic development in the direct area of influence of the project and the area of Chapare where non- traditional exports are being encouraged. For these trucks, generating traffic was determined evaluating the expected net increase, with the project, in agricultural and cattle production dedicated to the market, and transforming this additional production into additional vehicles per day considering, for example, that 20 tons of agricultural products equate to one truck or 20 cattle heads equate to one truck. The table below presents the resulting generated traffic for heavy and articulated trucks as percent of normal traffic in 2002. On the Santa Cruz - Abap6 and Camiri - Page 39
Yacuiba highways, which were paved in recent years, an evaluation of historic traffic counts indicatesthat generatedtraffic was on the order of 60 percentof normal traffic.
Highway Generated Traffic as Percent of Normal Traffic Section in 2002 for Heavy and Articulated Trucks Abap6- IpitaRoad 32.0 Ipita- IpatiRoad 35.0 Ipati - CamiriRoad 32.0 Camiri BypassRoad 32.0
For the Abap6 - Ipita section, two project alignment alternatives were considered. Aside from the alternative of paving the existing Abap6 - Ipita road, it was also considered the alternative of constructing a new road and paving a parallel road to the east of the existing road to server the towns of Espino and Charagua. The evaluation has shown that this alternative (Abap6 - El Espino - Ipita) has a greater length (72.0 km) compared to the existing Abap6 - Ipita road (67.0 km), has 3 percent higher construction costs, higher environmental concerns, and a resulting lower economic rate of return. Therefore,this alternativewas discardedand to serve the communitiesof El Espino and Charagua, the upgrading of the access road to El Espino was proposed with a lower paved road standard (6.0 meter wide surface treatment road) due to the current low traffic level. The direct area of influence of the access road to El Espino will have around 36 thousand inhabitants in 2002, at the opening of the road, and now the economically active population is 48 percent, of which 54 are occupied in the agricultural sector, 9 percent on the education and social service sectors, and 5 percent on trade, restaurants, and logging. This indicates that the economic base of the influence area is agricultural, which will benefit with an all-weather access.
Different surface layer alternatives were evaluated. The without project alternative includes routine maintenance, spot regravelling at 30 m3/km/year, and gradings every 90 days. The four project alternativesevaluated for each road are: (i) asphalt concrete paving, (ii) double surface treatment paving, (iii) single surface treatment paving, and (iv) regravelling the road with a 100 mm gravel layer each time the gravel layer reaches 30 mm. On all paving alternatives, paving starts in 1999 and the construction duration is 3 years with an annual costs distribution of 40, 35, and 25 percent of the total project costs. After paving, the maintenance policy includes routine maintenance, patching, and reseals every seven years. The evaluation period is set to 25 years, the discount rate is 12 percent, and the salvage value is 40 percent of the project costs.
The table below presents the main section characteristics and the resulting economic internal rate of return (EIRR) and net present value at 12 percent discount rate (NPV), for the corresponding project alternative with higher NPV. For all roads between Abapo and Camiri the optimal alternative is asphalt concrete paving, while for the access road to El Espino, a double surface treatment paving is the optimal alternative. Page 40
Existing New Average 1999 Alternative Base Base Road Road Road Vertical Daily With Financial Financial Section Length Length Gradients Traffic Highest Cost Cost EIRR NPV (km) (km) (%) (ADT) NPV (M$) (000$/km) (%) (M$) Abap6- Ipita 67.0 64.4 1.7 243 AC Paving 38.5 598 17.5 16.2 Ipita - Ipati 50.0 49.0 4.0 229 AC Paving 25.5 520 18.3 12.5 Ipati- Camiri 30.9 30.7 1.0 366 AC Paving 14.3 466 27.6 18.8 Camiri 8.0 7.3 1.8 286 AC paving 4.6 630 18.3 2.4 Bypass AccessRoad 39.0 38.0 2.0 35 DST Paving 7.2 189 10.5 -0.7 El Espino Total 194.9 189.4 90.1 475 19.1 49.3
All sections on the Abap6 - Camiri corridor yield an EIRR higher than 12 percent on the base and sensitivity scenarios. The upgrading of the access road to El Espino yields an EIRR of 10.5 percent indicating that this component is not justified by only accessing resource savings in vehicle operating costs and time for the expected normal and generated traffic. Considering that the objective of this component is to provide all-weather access to the indigenous communities in the area, which will bring many social non-quantifiable benefits, and that the economic return is very close to 12 percent, the component is expected to yield positive overall society benefits.
The overall EIRR of the upgrading program is 19.1 percent with a NPV of M$ 49.3. Six sensitivity tests were done: (a) a 20 percent increase in agency costs reduces the EIRR to 16.4 percent; (b) a 20 percent reduction in benefits reduces the EIRR to 15.9 percent; (c) a 20 percent increase in agency costs and 20 percent decrease in benefits reduces the EIRR to 13.7 percent; (d) eliminating the generated traffic originated by an increase in agricultural production in the region of Chapare, which represents 78 percent of the total generated traffic, reduces the EIRR to 18.6 percent; (e) eliminating all the generated traffic reduces the EIRR to 17.5 percent; and (f) reducing the traffic growth rate to 4 percent during the first 10 years and to 3 percent afterwards reduces the EIRR to 17.6 percent.
EIRR Sensitivity Base Costs Benefits Costs +20% Scenario +20% -20% Benefits -20% Abap6- Ipita 17.5% 15.1% 14.6% 12.5% Ipita - Ipati 18.3% 15.8% 15.3% 13.1% Ipati - Camiri 27.6% 23.9% 23.1% 19.9% CamiriBypass 18.4% 15.8% 15.2% 12.9% Access Roadto El Espino 10.5% 8.5% 8.1% 6.4% UpgradingProgram 19.1% 16.4% 15.9% 13.5%
Base Generated Generated 4 % & 3% Traffic Traffic Scenario Without Equal to Zero Traffic Chapare Growth Abap6-Ipita 17.5% 17.1% 16.2% 16.1% Ipita- 1pati 18.3% 17.8% 16.9% 16.9% Ipati- Camiri 27.6% 27.1% 25.6% 25.9% CamiriBypass 18.4% 17.8% 16.8% 16.9% AccessRoad to El Espino 10.5% 10.5% 8.2% 9.4% UpgradingProgram 19.1% 1 18.6% 17.5% 17.6% Page 41
The switching value analysis indicates that agency costs need to be increased by 71 percent or user benefits need to be decreased by 42 percent to yield an EIRR equal to 12 percent, which is very unlikely, therefore, the program is well justified.
Comprehensive Maintenance Program
The road maintenance program will fimd maintenance, for the next three years, for a road network of about 900 km in the area of influence of the project. SNC estimates that periodic works, comprising asphalt concrete overlays, surface dressing, and gravel resurfacing will be needed on 156.6 km of the network. All periodic works under this program were evaluated, using the HDM model, with current data for road, vehicle fleet, works characteristics, and costs. For paved roads, the with project alternative includes the proposed work occurring in year one as well as routine maintenance, 100% patching and future 4 cm overlays when roughness reaches 4.0 IRI; and was compared to a without project alternative consisting of routine maintenance, 100% patching, and, if needed, a future rehabilitation when roughness reaches 6.0 IRI. For unpaved roads, the without project alternative includes routine maintenance and one grading per year and the with project alternative includes gravel resurfacing in year one followed by routine maintenance and 4 gradings per year. To approximately access the benefits of the program's recurrent expenditures to be applied to all the network over the next three years, comprising of routine maintenance, emergency activities, and minor works, the HDM model was used considering that on the without project alternative 50 percent of the potholes will be patched and with the project 100 percent of the potholes will be patched, this being a surrogate to good and deficient recurrent maintenance activities. The table below presents the main section characteristics and corresponding results.
1997 Financial Financial Section Length Surface Traffic Work Cost Cost IRR NPV (km) Type (ADT) Type (000$) (OOO$/KM) (%) (M$) San Ramon-Los Troncos 2.0 S.T. 570 Double Surface 54.4 27.2 15.6% 0.01 DST Treatment San Ramon-Los Troncos 3.6 S.T. 570 Single Surface 68.6 19.1 14.3% 0.01 SST Treatment Pto. Pailas-Pailon DST 4.3 S.T. 500 Double Surface 106.6 24.8 16.1% 0.02 Treatmnent Pto. Pailas-PailonSST 4.9 S.T. 500 SingleSurface 84.1 17.2 15.0% 0.02 Treatment Pailon-Los Troncos DST 12.3 S.T. 570 Double Surface 335.4 27.3 15.6% 0.06 Treatment Pailon-Los Troncos SST 17.7 S.T. 570 Single Surface 336.4 19.0 14.4% 0.06 Treatment Camiri-Boyuibe DST 25.6 S.T. 176 * Double Surface 700.1 27.3 13.4% 0.08 Treatment Camiri-Boyuibe SST 25.5 S.T. 176 * Single Surface 484.2 19.0 14.9% 0.11 Treatment Yacuiba-Boyuibe SST 184.1 S.T. 176 * Single Surface 484.2 19.0 14.9% 0.11 Treatment Cocota-Pto. Pailas 0.7 A.C. 5876 Overlay 43.3 61.8 131.6 0.10
Mariana-Angostura 8.4 A.C. 643 Overlay 505.0 60.1 17.8% 0.03
Angostura-La Guardia 2.0 A.C. 1302 Overlay 113.3 56.7 47.4% 0.05
Ipati - Incahuasi 38.4 Earth 53 Gravel Resurfacing 650.1 16.9 38.1% 0.78
Los Troncos - Okinawa 10.6 Earth 247 Gravel Resurfacing 254.3 24.0 33.3% 0.08 Page 42
RecurrentActivities 893.5 RecurrentWorks per 2824.7 3.2 I N.A. 5.27 Year Road Maintenance 19.4% 6.69 Program * Generatedtraffic is expectedwhen the Abap6-Carniriroad is paved.
The overall rate of return of the road maintenance program is 19.4 percent with a net present value of M$6.7. Three sensitivity test were done: (a) a 20 percent increase in agency costs reduces the EIRR to 15.5 percent; (b) a 20 percent reduction in benefits reduces the EIRR to 14.7 percent; (c) a 20 percent increase in agency costs and 20 percent decrease in benefits reduces the EIRR to 11.8 percent. The switching value analysis indicates that agency costs need to be increased by 44 percent or user benefits need to be decreased by 31 percent to yield an EIRR equal to 12 percent, indicating that the program is justified.
Distribution of Benefits
An evaluation of the upgrading program indicates that: (i) 88 percent of the program benefits are due to a reduction on vehicle operating costs and 12 percent due to time savings; (ii) 13 percent of the road user benefits go to cars and pickups, 32 percent go to buses and 55 percent to trucks; and (iii) cars and pickups save 64 percent on road user costs, buses 47 percent, and trucks 56 percent. To estimate the proportion of the program benefits that will directly benefit low income groups, the following assumptions have been considered: (i) none of the benefits for cars and pickups will benefit low income groups considering the high income of passenger cars; (ii) 88 percent of the benefits for buses will benefit low income groups considering that this is the proportion of low income population in the area; and (iii) 38 percent of the benefits to trucks will benefit low income groups considering that that is the proportion of the cargo that carries agricultural products and other goods of basic local consumption. The result of the evaluation is that around 50 percent of the program benefits will benefit directly low-income groups in the area of influence of the project.
Overall Project Benefits
The table below presents a summary of the overall project benefits. The overall project EIRR is 19.1 percent. A 20 percent increase in agency costs reduces the EIRR to 16.4 percent. A 20 percent reduction in benefits reduces the EIRR to 15.8 percent. A 20 percent increase in agency costs and 20 percent decrease in benefits reduces the EIRR to 13.5 percent. To yield an EIRR equal to 12 percent, agency costs have to be increased by 69 percent or benefits decreased by 41 percent. These events have a low probability of occurrence indicating that the project economic viability is robust.
Switching Values Net Internal Increase Decrease Present Value Rate In Agency in User
@ 12 percent of Return Costs to Yield Benefits to Yield (US$ Million) (%) NPV= 0 NPV = 0 Users Upgrading Program 118.6 Maintenance Prograrn 9.9
Subtotal 128.5 Agency Upgrading Program -69.3 Maintenance Progran -3.2 Subtotal -72.5 Society Upgrading Program 49.3 19.1% 71% 42% Maintenance Program 6.7 19.4% 44% 31% Overall Project 56.0 19.1% 69% 41% Page 43
Annex 5
Abap6 - Camiri Highway Project (ACA-HP)
Financial Summary
Bank's Fiscal Years (July 1 - June 30) (In million US$ 1999)
Implementation Period | 2000 2001 2002 2003 2004 TOTAL ProjectCosts InvestmentCosts 21.0 31.5 32.1 15.4 8.1 108.1 MaintenanceCosts 0.7 1.9 2.9 3.4 1.0 9.9 TechnicalAssistance Costs 0.4 0.4 0.4 0.4 0.4 2.0 Total 22.1 33.8 35.4 19.2 9.5 120.0
FinancingSources (% of total projectcosts) IDA 16.8 25.4 26.1 13.0 6.7 88.0
Government 5.3 8.4 9.3 6.2 2.8 32.0
User Fees/Beneficiaries Others 0.0 0.0 0.0 0.0 0.0 Total 22.1 33.8 35.4 19.2 9.5 120.0 Page 44
Annex 6 Abapo - Camiri Highway Project (ACA-HP)
Procurement and Disbursement Arrangements
Procurement
Procurement methods (Table A)
The Government agreed to use IDA standard procedures for goods and civil works under ICB in accordance with the "Guidelines for Procurement under IBRD Loans and IDA Credits, January 1995," revised in January and August 1996, and September 1997. For the engagement and use of consultants follow IDA standard procedures according to the "Guidelines Selection and Employment of Consultants", January 1997, revised September 1997. Civil works are estimated to account for about 92.9% of total project costs, consulting services about 7.0%, and 0.1% in goods. Table A shows the distribution of the type of procurement appropriate for the acquisition of works, goods and services under the project.
Civil Works.
Prequalification.
Civil work contracts for Component A Abap6-Camiri Highway (Bridge over the Rio Grande, Abap6-Ipita, Ipita-Ipati, Ipati-Camiri), and Component C Comprehensive Maintenance will require prequalification of contractors based on "Prequalification Procurement of Works, April 1993" and defined in terms of minimum working capital, professional experience, volume and scope of similar works. All contractors (foreign and local) interested in being prequalified will be evaluated on the basis of "fail or pass evaluation criteria"; that is, only those complying with the minimum criteria will be qualified.
International Competitive Bidding - ICB
Civil works contracts for ComponentA Abap6-CamiriHighway (Bridge over the Rio Grande, Abapo-Ipita, Ipita-lpati,Ipati-Camiri, and the CamiriBy-pass) and ComponentB AccessRoad to El EspinoRoad, as well as any civil works estimatedto cost US$10 million or more, will be procuredon the basis of ICB procedures in accordancewith "Bank StandardDocuments for Procurementof Works(Major Works), January 1995".
Civil work contracts for Component C Comprehensive Maintenance, as well as any civil works estimated to cost more than US$3 million and less than US$10 million, will be procured on the basis of ICB procedures in accordance with the "Bank Standard Documents for Procurement of Works (Smaller Contracts), January 1995".
National Competitive Bidding - NCB
Contracts for works costing between US$3 million and US$250,000 will be procured under NCB acceptable to IDA. These will be based on standard bidding documents to be approved by the Association. The following principles will govern procurement under NCB: (i) foreign contractors will be allowed to bid on all contracts and will not be required to be associated with local contractors or suppliers; (ii) there will be no restriction on sources of labor or materials, except for use of unskilled labor: (iii) invitation to bid will be advertised for at least three days in a newspaper with wide circulation in Bolivia; (iv) no reference to minimum or maximum prices will be used for Page 45 purposes of evaluation of bids for supply of goods; (v) bids will be opened in public; and (vi) contracts must be awarded to the lowest evaluated bidder in accordance with criteria clearly set forth in the bidding documents.
Price Quotations
Routine maintenance works estimated to cost less than US$250,000 equivalent per contract will be procured on the basis of price quotations acceptable to IDA. The price quotations should be obtained from three qualified local contractors (with experience and resources to successfully complete the contract) in response to a written invitation. The invitation will include a detailed description of the works, including basic specifications, the required completion date, a basic form of agreement acceptable to the Bank and relevant drawings when necessary. The award will be made to the lowest evaluated bidder in accordance with criteria clearly set forth in the bidding documents.
Goods.
Goods and equipment costing less than US$50,000 per contract will be procured through local shopping.
Consulting Services.
Consultants for civil work supervision, technical assistance, training programs, engineering and auditing services will be selected and engaged following the January, revised September 1997 Bank Group consultant guidelines. The hiring of consultants will be made using QBCS, LCS and hiring of individuals will be made on Selection Based on Qualifications.
Prior review thresholds (Table B)
The Association will review ex-ante all procurement documentation (advertising, bidding documents, bid evaluation and contract award) under ICB as well as the first two contracts in each year under NCB. The documents for the remaining contracts under NBC will be subject to ex-post review by the IDA. All other procurement documentation will be retained by the SNC and subject to selective ex-post review by the IDA's supervision missions. The provisions of the Consultant Guidelines requiring prior IDA review or approval of budgets, short lists, selection procedures, letters of invitations, proposals, evaluation reports and contracts shall not apply to: (a) contracts for the employment of consulting firms estimated to cost US$200,000 equivalent or less each; or (b) contracts for the employment of individual consultants estimated to cost US$50,000 equivalent or less each. However, this exemption to prior IDA review will not apply to: (a) terms of reference for such contracts; (b) single source selection of firms; (c) assignments of a critical nature as reasonably determined by the IDA; (d) amendments to contracts for the employment of consulting firms raising the contract value to US$200,000 equivalent or more; or (e) amendments to contracts for the employment of individual consultants raising the contract value to US$50,000 equivalent or more. Under these procedures, IDA's prior review will cover 98.6% of the total contract values.
Disbursement
Allocation of loan proceeds (Table C)
Disbursements will be made against the following categories of eligible expenditures: (a) 80% of total expenditures for civil works of road upgrading, and bridge construction; (b) 20% of total expenditures for the comprehensive maintenance by contract program, and routine maintenance Page 46 works; (c) 80% of total expenditures for civil works and comprehensive maintenance supervision; (d) 100% of foreign expenditures and local expenditures (ex-factory costs), and 80% of items procured locally, for goods; and, (e) 100% of the cost for consulting services for technical assistance to SNC and VMT, and technical audits. Table C shows the basis of loan disbursements.
The estimated schedule of disbursements is shown in Annex 5. The Government's aim is to substantially complete the project by December 2003, and the implementation schedule has been developed on this basis. Experience shows, however, that some slippage is likely. The expected project closing date is June 30, 2004.
Use of statements of expenses (SOEs):
Disbursement requests in respect of civil work contracts over US$3,000,000; and consultant contracts over US$200,000 for firms and US$50,000 for individuals will be fully documented. In all other cases, disbursements will be made against statements of expenditures (SOEs). All SOEs will be transmitted through SNC, which will retain the supporting documentation in separate files for each SOE and make it available for examination by IDA staff during supervision missions. During project preparation, it was confirmed that there are sufficient and qualified staff in the SNC to record, handle and report on the SOE related transactions.
Special account:
A Special Account (SA) will be opened and maintained in US dollars in the Central Bank of Bolivia, and up to US$6 million can be advanced from the credit into the SA to facilitate disbursements for the purpose of the project. The initial deposit will be limited to US$3 million until the aggregate disbursed amount has reached US$12 million. IDA will replenish the Special Account upon receipt of disbursement requests from the Borrower. The SNC will control the use of the Special Account and be responsible for preparing the disbursement requests on behalf of the Borrower. These requests should be submitted every month, or when the Special Account has been drawn to 35% of its initial deposit, whichever comes first.
The operating arrangements for the Special Account have been agreed at negotiations. Page 47
Annex 6, Table A: Project Costs by Procurement Arrangements
(US$ million equivalent)
Total Cost ExpenditureCategory ProcurementMethod (including contingencies) ICB NCB Other N.B.F
1. Works 111.5(82.3) a) Bridge in Abap6 4.6 (3.7) b) Abap6 - IpitA 38.0 (30.4) c) IpitA- Ipati 28.4 (22.7) d) Ipati - Carniri 15.7 (12.5) e) Camiriby-pass 5.1 (4.1) f) AccessRoad to El Espino 8.0 (6.4) g) ComprehensiveMaintenance 11.5(2.3) h) RoutineMaintenance 0.1 (0.1) 0.1 (0.1)
2. Goods 0.1 (0.1) a) For SNC & VMT 0.1 (0.1)
3. ConsultingServices 8.4 (5.6) a) InstitutionalStrengthening 0.3 (0.3) 1.4 b) SupervisionCivil Works 5.9 (4.6) c) Supervision Compreh.Maint. 0.8 (0.7)
4. Miscellaneous
Total 111.3(82.1) 0.1 (0.1) 7.2 (5.8) 1.4 120.0 (88.0)
Note: N.B.F. = Not Bank-financed (includes elements procured under parallel cofinancing procedures, consultancies under trust funds, any reserved procurement, and any other miscellaneous items). The procurement arrangement for the items listed under "Other" includes civil works procured with price quotations.
Figures in parenthesis are the amounts to be financed by the IDA credit. Page 48
Annex 6, Table Al: Consultant Selection Arrangements
(in US$million equivalent)
Selection Method Consultant Services Expenditure Total Cost Category (including contingene ies) QCBS QBS SFB LCS CQ Other N.B.F. A. Firms 8.3 (5.5) Supervision Civil Works 5.9 (4.6) Supervision Compreh. Maint. 0.8 (0.7) T.A. Concession Project 0.1 (0.1) Tech. & Finan. Auditing 0.1 (0. 1) Reset.&Ind.Peop.&Com.Rel. Plans 1.4 B. Individuals 0.1 (0. 1) PCU & EU and Training 0.1 (0. 1)
Total 6.8 (5.4) 0.1 (0.1) 0.1(0.1) 1.4 8.4 (5.6)
Note: QCBS = Quality- and Cost-Based Selection QBS = Quality-based Selection SFB = Selection under a Fixed Budget LCS = Least-Cost Selection CQ = Selection Based on Consultants' Qualifications Other = Selection of individual consultants (per Section V of Consultants Guidelines), Commercial Practices, etc.
N.B.F. = Not Bank-financed. Figures in parenthesis are the amounts to be financed by the IDA credit. Page 49
Annex 6, Table B: Thresholds for Procurement Methods and Prior Review
Procurement item as per the Procurement Plan
Review 1.0 Civil Works Prior Review of all prequalification documents
Prior Review of all contracts each year
Prior Review of first two contracts each year
Post Review
20 Goods Post Review of a sample of contracts 3.0 Consultant's Services 3.1 Firms Prior Review of Consultants: all TORs, short lists (including full review of technical and combined evaluations)
Prior Review of all TORs and short list 3.2 Individuals Prior Review of all TORs and short list
Prior Review of Consultants: CV's and Term.sof Reference. Post Review of Consultants: Contracts.
Prior Review: twice yearly review of program of contracting. Post Review: random sample of contracting documents. Page 50
Annex 6, Table C: Allocation of Loan Proceeds
Expenditure Category Amount in Amount in Financing Percentage US$ million SDR million
1. Civil Works 74.30 54.60 a) Road upgrading and reconst. and bridge construct. 72.10 52.95 80% b) Comprehensive Maintenance Program 2.00 1.50 20% c) Routine Road Maintenance 0.20 0.15 20%
2. Consulting Services 5.50 4.07 a) Civil Works Supervision and Tech. Auditing. 4.60 3.4 80% b) Supervision of a Comprehensive Maintenance 0.60 0.45 80% c) SNC & VMT Institutional Strengthening. PCU, 0.30 0.22 100% Environmental Unit & Concessions.
3. Goods 0.10 0.08 80% local expend., and 100% of foreign expend.
4. Unallocated 8.10 5.95 74% (Average)
Total 88.00 64.7 73% (Average) Page 51
Annex7
Abap6 - Camiri Project (ACA-HP)
SNC FinancialManagement Assessment Summary
The financial management assessment of SNC, which is a required component of the project appraisal, was based on the findings of the external auditors for 1997 and work in process on the 1998 and the review conducted during the missions of November 1998 and April 1999. The conclusion of the assessment is that now that SNC has reconciled its assets accounts with subsidiary records and performed the other reconciliations; the records can be considered reliable hence their financial management is adequate.
The work taken to address the problem of reconciliation between the investment accounts in the general ledger of the entity, which relate to the projects underway, and the subsidiary project records kept in the Project Coordination Unit is now completed, will result in an improved opinion of the auditors, and provides a reliable link between the double entry entity wide accounts and the project specific expense analysis, used to produced the external reports. Fortunately, the reporting systems and other controls in place will support LACI, once minor modifications to the project reporting are effected.
Organization and Staffing
The project will be administered within SNC's Financial Department and will be subject to all the review and control of the operations of the entity including internal audits. The staff of SNC is of sufficient size to permit proper segregation of functions and independent review. To achieve timely external reporting and additional supervision over the operations, a Project Coordination Unit is staffed and responsible for recording all project expenditures by credit agreement and preparing the individual project external and management reporting in the format required by respective donors.
The administrative function is organized under the financial department manager (Jefe del Departamento de Finanzas), and reporting to him are: the Head of the Accounting Department and the Head of the Projects Unit. Additionally, there is an Internal Audit Department reporting to the Executive Director. The background and qualifications of the staff currently appointed fully meet the requirements for this responsibility.
Accounting System
SNC has a computer based double entry bookkeeping system designed to record all the entity's activity (i.e. all projects and regular resources) under the uniform government accounting system. These are the records that support the entity and the project external audit and are the source of input or compliance with the national accounts compiled by the Ministry of Finance. The SIIF (Sistema Integrado de Informaci6n Financiera) input is made directly from the system. However, since the transactions are coded in the books under the uniform account code, there is no reliable link between these and the cost categories and components presented in the credit agreement, registered by the project reporting prepared by the Project Coordination Unit.
To address the external reporting requirements, the Project Coordination Unit processes all charges to the project before they are actually disbursed and booked by Accounting, as such, they register these in their subsidiary project records in the exact format of the credit agreement i.e. by cost category and component. This record is complemented by notations on the physical progress and the contract status. This set of project financial and physical records by contract constitute an excellent base for monitoring and would support LACI-PMR reporting Page 52
This approach of using subsidiary projects outside the official accounting has the advantage of being flexible to accommodate the exact format of the credit agreement and being able to add non financial data in the same records. This requires that these records be kept balanced to the entity accounting records (general ledger).
Auditing Arrangements
SNC engaged external auditors for Credit 2395-BO who were satisfactory to the Bank and worked under Terms of Reference acceptable to the Bank for both the project and the entity audits. It was agreed during negotiations that similar arrangements will be followed for the proposed credit and that the financial audit will be contracted for the total estimated period of project implementation and that the procurement process for the audit will start as soon as the credit is effective.
The project financial statements of Credit 2395-BO for 1997 received a clean opinion, while the entity audited statements were given an adverse opinion that arose from: (i) limitations in the scope, since the auditors were not appointed on time for the year end inventory taking, so they could audit the stock taking; (ii) the fact that 80% of SNC assets relate to finished works which should have been passed to memo accounts and the lack of reconciliation between the asset balance and the corresponding equity accounts; and (iii) the lack of reconciliation between the investment accounts, which relate to the projects underway, and the subsidiary project records kept in the Project Coordination Unit. SCN contracted in 1998 a team of professional accountants who resolved the three issues mentioned as causes of the adverse opinion and implemented the recommendations presented in the report on internal control.
Disbursements, Funds Flow, and Cash Management
It was determined that the project will be funded through a Special Account operated in compliance with the provisions of Operational Guidelines and Directives (OP/BP/GP 12.20) on the basis of cash withdrawal requests supported by Statement of Expenditures for the first 12 months and then supported by quarterly PMRs.
Funds will be drawn from the Special Account periodically and transferred to a disbursements account in Bolivianos in a commercial account for exclusive use by the project. Disbursements originate with the request of the technical staff, which is recorded as a commitment in the Accounting area and then processed for payment in Treasury following the review and approval by Accounting of the supporting documentation.
PMR Preparation
It was agreed that during the first year of the project SNC will take the following steps needed to produce the PMRs in accordance with the LACI Handbook.
(i) Attend Bank workshop on LACI financial statement preparation. Aug./Oct. 1999
(ii) Develop customize Excel Spread Sheets in the Project Coordination Unit (Report 1) with link to contract control (Report 3). Sept./Nov 1999
(iii) Develop reporting format for the Key Performance Indicators which are quantifiable and for which costs can be assigned (Report 2) Oct./Dec. 1999
(iv) Prepare PMRs for activity on 1999 parallel to SOEs already submitted 1st quarter 2000. Page 53
Annex 8
Abap6 - Camiri Highway Project (ACA-HP)
Environmental and Social Assessment
Introduction
Most of the rehabilitation and paving under the project will follow the existing road alignment. An initial environmental screening of the project identified no potentially significant direct and indirect impacts. No precedent setting or regional impacts of importance were envisioned. Most direct impacts will be related to erosion, slope stability and drainage concerns, easily dealt with through the engineering design. However, the screening also identified the need to deal with issues such as: (i) minor resettlement of rural and urban families along the right of way; and (ii) the definition of a major alternative alignment proposed by indigenous communities that would go through or closer to their territories.
Although the project was classified as Category B for environmental purposes, and in order to comply with national environmental assessment legislation, a full environmental assessment was undertaken during project preparation. The terms of reference for this study were complemented to follow Bank guidelines specially to deal with resettlement and indigenous people issues. As part of the EIA, an assessment of potential social impacts was completed (for a full description of the study and its results see the Estudio de Impacto Ambiental Carretera Abapo-Camiri report, in Project Files). The assessment focused on the direct and indirect impacts the project could have on families within the project area of influence and on indigenous people communities.
Indirect Impacts
The EA report analyzed potential indirect or induced impacts at the regional level stemming from improved road conditions. These impacts were deemed of lesser magnitude and importance due mainly to the existing conditions and environmental setting of the project. Additional pressures on natural resources (logging, colonization) are also expected to be of low magnitude because: (i) the existing road has been operational for several decades with an existing traffic of around 300 vehicles (mainly trucks) per day; (ii) oil exploration and exploitation have been important economic activities in the area for many decades (Camiri is indeed an oil boom town) and the area is traversed by seismic lines, oil roads, and pipelines; (iii) the Santa Cruz-Abap6 link, as well as the Camiri- Argentine border segment, have already been paved (for over 4 years), the only unpaved section being Abap6-Camiri; (iv) soil conditions and negative water balance in the area preclude any intensive agricultural activity; and (v) existing national parks and reserves are located at a significant distance from the road and are well protected. In addition, the Santa Cruz Department has prepared and is implementing a land use plan (PLUS) for the entire department, which establishes land use restrictions and infrastructure construction, extensive cattle ranching being the recommended use for the Abap6-Camiri area, with a watershed protective forest in the Abap6-EI Lim6n area (km 30-50 of the proposed road). Local expectations towards this project are quite high specially in the indigenous communities. These communities want an improved access to Santa Cruz for their products.
Alternative Alignments
Improved access to markets, mainly Santa Cruz, has been a long time aspiration of indigenous communities in the Charagua area. They proposed an alternative alignment through the El Espino village (some 35 km from Abap6), and then connecting back to the original alignment at Ipita. This alternative was viewed as a way to guarantee an access to indigenous communities to an improved Page 54 international road. However, this alternative alignment would entail: (i) going through a small, yet inaccessible watershed (Itani Creek), with high slopes and impressive scenery, but which still maintains relicts of native flora and fauna; and (ii) a higher risk of cultural impacts as the highway traffic would go closer to indigenous communities. The proposed alignment would also increase traffic time and costs because of the geological restrictions. This alternative in itself would also require a Category A classification according to Bank's EA policies. Public consultation meetings were held, in which the benefits and negative impacts of both alternatives were presented to the communities. As a conclusion, the government agreed that the project would guarantee access to the communities regardless of the alignment finally selected. The final alignment would follow the existing road between Abap6 and El Limon. However, the government agreed that the Abap6 - El Espino link will also be paved as a major component of an indigenous peoples development plan. In this manner, the indigenous communities will have access to project benefits but avoiding the most potentially negative impacts of their proposal.
Other alternative alignments considered included by-passing some of the communities in order to minimize resettlement needs and traffic safety concerns. In total, five by-passes will be built, including a 7.3 km by-pass at Camiri. These by passes, in turn, raised some concerns in local communities regarding the impact on roadside activities.
Principal Environmental and Social Impacts
The most significant and potentially adverse direct impacts identified by the study are related to: (i) the resettlement of families in the right of way and the potential economic affectation of small business; (ii) the interaction of workers with the local community and potential damages to private property and community infrastructure, and nuisances to communities caused by construction activities; (iii) the potential impacts on indigenous communities due to increased risk of encroachment on indigenous lands, both in terms of land security and cultural impacts; and (iv) localized environmental impacts due to new alignments and by-passes, road widening, and construction activities. Measures to avoid, mitigate and/or compensate affected families and communities were developed into specific plans.
Public Consultation
Consultation with civil society representatives and local community leaders throughout the process helped with the identification of these potential adverse impacts, as well as with the definition of the mitigation/compensation plans. During the consultations widespread support to the project was found and the potential positive and negative social impacts were discussed with the participants.
Environmental Management Plan
The environmental and social assessment recommended four specific action plans aimed at avoiding and/or mitigating possible negative impacts and enhancing access to the expected benefits of the project: (i) resettlement plan; (ii) indigenous peoples development plan; (iii) community relations plan; and (iv) environmental management of construction activities.
(i) Resettlement Plan
The Abap6-Camiri road passes through several small towns and hamlets. To avoid town crossings, multiple realignments and bypasses were introduced into the project design (Tatarenda Nuevo, Gutierrez, Ipita, Ipati and Camiri). According to Bolivian legislation, the road's right of way is 50 m. to each side. Within the right of way more than 80 households were identified by the study. However, to minimize the affectations, the SNC allowed for a partial use of the "legal" right of Page 55 way, identifying only those dwellings that would be physically affected by the road platform, embankments, drainage and for road safety reasons, and reducing the actual right of way to 30 meters in key points along the highway, thus decreasing in that way the number of families that would be forced to move only to 34.
While the road realignments and bypasses helped to significantly decrease the resettlement needs, at the same time they could have an impact on small merchants and service providers located at the side of the existing road, by reducing traffic and business activities on existing routes through small towns. These merchants will be affected as with the new road their potential clientele would have to take a detour to access them or passing by traffic would simple no longer stop. Some 92 small merchants and service providers under these conditions were identified (see Box 1). The project will provide technical assistance to these municipalities to identify alternatives for taking advantage of the new road conditions and by passes and the re-establishment of economic activities for affected businesses.
Box 1. Impactson RoadsideActivities: Perhapsthe most importantcommunity activities affected by the new road conditions (by-passes,bridge) will be the crossing of the Rio Grande river at Abap6. Over 40 small poor family business (mainly food and refreshments,some stay-over "hotels") have thrived on the obligatorystop of buses and traffic to cross the river over a one-way railroadbridge. Most of small businesshave illegallyoccupied lands along the existingroad and the accesspath to the railroad bridge. Traffic congestion is high and sanitary conditions are deficient. During public consultationmeetings, municipal and communityleaders expressedtheir fear of the loss of business due to the constructionof a new bridgeunder the project. On the other hand, SNC wanted to avoid a disorderly"migration" of these business to the new bridge access or to other sites along the right of way of the new road. In additionto a minorcash compensationto help their relocation,the projectwill provide: the basic infrastructure(clearing, paving and drainage)of a roadside site provided by the municipalitynext to a future toll booth at the town entrance(around two kilometersfrom new bridge). This infrastructurewill be the first step towards the constructionof a town rural market which is being supportedby the municipalityand the cooperativeof small businessin Abap6.
To mitigate and compensate for the affectations caused by the involuntary resettlement of families and business loses, a resettlement plan was prepared (See Plan de Indemnizaci6n y Reasentamientos Humanos, PIRHon Project Files). The resettlement plan included different options based on the degree of vulnerability and affectation of the families: (i) cash indemnification; (ii) relocation within the same property; (iii) resettlement to a new location in the vicinity; (iv) cash compensation for potential business loses. The resettlement seeks to improve the living conditions of the affected families, particularly of those more vulnerable and poor. In this regard, the plan comprises the construction of a basic rural dwelling which is substantially better that the current houses these families occupy. Most of these cases are occupants with no land titles. The resettlement plan will provide then with secure land titles and better housing conditions.
Eleven families will receive cash indemnification, 18 families will be resettled to other location and, 5 families will be relocated within their property. Also, the right of way crosses by 112 agricultural properties that are affected in different degrees. Direct costs of the resettlement plan are US$ 415,663. Table 1, summarizes the types of affectations and amount of indemnification/compensation for each. Page 56
Table 1: Resettlement Plan: Type and Number of Affectations and Compensation Costs
Type of Affectation Number of Cost Affected (US$) Units Dwellingaffectation with cash compensation 11 111,736 Resettlementto other location 18 62,663 Relocationwithin the property 5 16,973 Businesswith cash compensation 92 91,815 Agriculturalproperties with cash compensation 112 62,976 Staff,equipment and administrationcosts 69,500 Total 415,663
The SNC would be responsible for the general implementation and supervision of the resettlement plan. The resettlement plan would be implemented by an executive environmental unit (Unidad Aimbiental Ejecutora) and some specific activities would be decentralized to either contractors or local governments. The resettlement plan would be initiated before construction works begin and support to affected families would continue until the affected families have been satisfactorily reestablished.
(ii) Indigenous People Development Plan
Indigenous populations are mainly settled in areas over 30 km. from the road. Some 16,000 indigenous people from the "Capitanias Kaaguasu, Kami and Charagua Norte live in the project's area of influence. These capitanias have land claims over 455,000 Ha. However they do not have land titles that would grant them land tenure security. Most of these communities survive from agricultural and livestock production which are combined with seasonal wage-work. Incidence of poverty among these communities is high, much of their basic need are unsatisfied and their overall quality of life is poor. The lack of regular transport has been a chronic feature that has contributed to the communities' poverty. Currently, indigenous communities in the area lack permanent and easy access to basic services and markets.
The indigenous people see the Abap6-Camiri highway and the access road to El Espino as an effective alternative that could contribute to improve their quality of live and provide better opportunities for economic development. The indigenous communities are most interested in the construction of the road to facilitate their access to markets. This interest was confirmed by representatives (Capitanes Grandes) of the Kaaguasu, Kami, Charagua Norte and Bajo and Alto Izozog, communities that officially requested that the construction of the road goes through El Espino, and also by the identification mission in informal meetings with thecorregidor (the mayor) of the community of El Espino. This access would follow an existing dirt road parallel to the railway, surrounding an area of indigenous settlements, although it is separate enough from them and would provide benefits to the indigenous communities without serious negative impact.
However, the indigenous communities are also aware of the potential risks the Abap6-Camiri highway and the access road to El Espino may have in terms of opening their lands to colonization as well as the weakening of their social organization and culture. During the consultation process the IDA mission discussed with the indigenous communities about these potential negative impacts and the indigenous leaders emphasized the importance of land titling as a mechanism to prevent colonization.
As a result of the assessment and through a process of consultation with indigenous representatives from CABI and CIDOB, as well as with the local communities living in the project area, an Indigenous Peoples Development Plan (PADI) aimed at ensuring that the communities would Page 57 benefit from the road was agreed. The PADI entails several activities ranging support to land titling to bilingual education and support to handcrafts development.
Specifically, the PADI comprises four components (for details see Plan de Apoyo al Indigena, PADI, on Project Files). First, there is a land titling component that seeks to facilitate the land titling process. Through this component funds would become available to the communities. These resources would enable the communities to get technical assistance and provide follow up the legal process. Second, the PADI entails an organizational strengthening component, which seeks to help the Capitanias of Kaaguasu, Kami, Charagua Norte to identify training needs and provide training to some 70 community leaders. Third, there is a bilingual education component that would contribute to the training on bilingual educatioiu of rural school teacher and would provide bilingual teaching materials to the rural schools in the area. Finally, there is a handcraft development component targeted to indigenous women to improve the quality of their products and help them with their marketing. Table 2 summarizes the costs of the PADI by component.
The PADI would coordinated and supervised by a Board of Directors constituted by four indigenous leaders (one from each of the three Capitanias and a representative from theAsociacidn del Pueblo Guarani), a representative for the SNC, a member of the environmental supervision contractor firm and the executive director of the PADI and PIRH. The PADI will be executed by a contractor (the same that will implement the PIRH).
Table 2: Indigenous People Development Plan: Costs by Component
Component Cost
Land Titling 38,050 OrganizationalStrengthening 50,850 BilingualEducation 67,050 HandcraftDevelopment for Women 57,850
Administration 82,650
Total Costs 296,450
(iii) Community Relations Plan
Road construction works may disrupt the communities in the vicinity of the right of way as there will be an influx of workers increased traffic of heavy machinery, potential damages to private property and conflicts with the local population. Further to the consultation process, specific participation mechanisms were identified and a committee with representatives from different civil society organizations was established. This committee recommended follow-up activities to facilitate communications and to avoid conflicts with the local community. As a result of this process a Community Relations Plan (CRP) was developed.
The CRP involves: (i) the establishment of a civil society consultative committee, (ii) procedures and mechanisms for information dissemination and community access to project management and; (iii) support to local governments for urban planning initiatives. It also involves specific recommendations regarding location of worker's camp, workers' code of conduct and indemnification procedures for potential damages which were introduced in the Environmental Management Plan. Technical assistance to local communities will also be provided in order to Page 58 support land use planning and identify alternatives to improve roadside activities under the new conditions of the highway and the by-passes. Table 3 below summarizes the main activities and costs of the CRP.
Table 3: Community Relations Plan: Costs by Component
Component Cost
PublicInformation 11,600 Environmentaltraining 16,450 Publicsafety outreachactivities 37,600 Supportto UrbanPlanning 154,500 Supportto the Developmentof MarketingStrategies 52,850 Staff and Administration 405,400 Total Costs 678,400
A Board of Directors would be responsible for the execution of the CRP. The board, composed by representatives from the SNC, six representatives of the local governments (Abap6, El Espino, lpita, Gutierrez, Ipati and, Camiri), a member of the environmental supervision contractor firm and an executive manager who would also be a board member.
The area has no known archaeological sites and the potential for chance findings is low. However, chance finding procedures for archaeological sites will be part of the environmental specifications for construction activities. In addition, the Board of Directors of the SRP will be also responsible for managing a contingency fund (US$20,000) for archeological salvage.
Environmental specifications for road design and construction
All mitigation measures for direct impacts (erosion control, embankment and slope stability, drainage) have been incorporated into project design and will be included in project costs. In addition, all the environmental requirements for road construction have been incorporated in an environmental annex which will be part of bidding documents. This manual establishes specific rules for minimizing environmental impacts during construction and provides guidance on the design of specific environmental mitigation measures such as slope stability, construction waste disposal and erosion control. Examples of topics that are included in the environmental specifications annex are: (i) explicit prohibitions and environmental behavior guidelines for work crews, specially along sensitive areas and near rural communities; (ii) proper selection and management of quarries, borrow pits, gravel extraction sites in rivers and streams; (iii) the rehabilitation of affected areas through soil replacement and revegetation; (iv) selection of camp sites (with specific guidelines on distance to communities according to their population), management of camp wastes, and guidelines for camp dismantling and abandonment; (v) proper disposal of excavated earth and spoil materials to avoid pollution of streams; and (vi) proper disposal of wastes from construction machinery and equipment. The guidelines will also include chance finding procedures for archaeological artifacts. Enforcement of these guidelines will be under the responsibility of the Supervision Engineering firm.
Institutional Capacity for Environmental Management
At present, SNC's capability to address environmental issues associated with road projects continues to be weak. However, environmental management capacity in SNC is being strengthened through the ongoing Road Maintenance Project. The proposed reorganization of SNC (starting Page 59
January 1999) will elevate the existing environmentalunit of SNC to a higher hierarchical status within the organization(Division Level) and under the technical Sub-Directorate. The project will provide additionalsupport to SNCto strengthenenvironmental management capabilities. FM11 t~~~JFM~Ji- -- I -F - I Esti 0 ll
C,~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~i ES1331 13Sa 13-13 -311 L lEl. 121 L 4 1 E3 113W10 121j1 ESS 1a10N1LElt I,~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~1 ' 1131E1' ' ' '
~~~~~~~~~~~~~~~~~~~~~~~~~...... \...... 7....
...... - ......
'0.
1 11 1 1-1C -'a -l '- 11 -1'1
...... , ...... Ct~~~~C
,~~~~~~~~~~~~~~~~~~0,
.~~~~~~~~~~~~~~~~(4- "i Page 61
Annex 10
Abap6 - Camiri Highway Project (ACA-HP)
Project Performance Monitoring Indicators
The following set of Project Performance Indicators will serve as the basis for both the project supervision and evaluation. They have been organized in four groups: input, output, outcome and impact indicators to link the project objectives and components (inputs) with the expected processes, outputs and outcomes. They will provide the project implementers with a monitoring tool for ensuring proper use of project resources and that the goods and services the project is expected to produce are delivered.
A. Input Indicators measure the quantity of resources provided for the project activities.
1. Project Resources (US$000).
Project Components IDA GoB Others Total CivilWorks 80.0 20.1 0.0 100.1 ComprehensiveMaintenance 2.2 9.2 0.0 11.4 Supervision 5.4 1.3 0.0 6.7 Goods 0.1 0.0 0.0 0.1 Consultingservices 0.3 1.4 0.0 1.7 Total 88.0 32.0 0.0 120.0
2. Maintenance budget (US$ million) (not project financed)
Budget 1999 2000 2001 2002 2003 (Calendar
y ea r)______Planned 20.0 21.0 21.0 22.0 23.0
Executed I I_ _ _
3. Civil Works Cost. (including supervision and contingencies)
Projects Components Estimate Actual Differenc % d US$ US$ e 000 000 (A) Abap6Camiri Highway (cost per km) 640 (B) AccessRoad to El Espino(cost per km) 224 (C) Comprehensive Maintenance (cost per km-year) 4.6 = * (CD) Maintenancecost per kilometer(periodic) 24.0 * (CE) Maintenancecost per kIn-year(routine) 3.0
4. Disbursements (US$ million).
Bank's 2000 2001 2002 2003 2004 FY IDA GoB IDA GoB IDA GoB IDA GoB IDA GoB Estimate 168 5 25.4 .4 26.1 9.3 13.0 6.2 6.7 2.8 Actual Page 62
5. Average Supervision Cost as percentage of civil works contracts.
Bank's FY 2000 2001 2002 2003 2004 Supervision cost/civil works cost (%/O) Supervision cost/compreh. maint..cost (%) Estimate: 6% (Civil Works) 8% (Comprehensive Maintenance)
6. Average percentage of physical contingencies in civil works .
Bank's FY 2000 2001 2002 2003 2004 Physical Contingencies in Civil Works (%) Physical Contingencies in Compr. Maint.(%) Estimate: 8% (Civil Works) 8% (Comprehensive Maintenance)
7. Average percentage of contingencies in consulting contracts.
Bank's FY l 2000 1 2001 1 2002 J 2003 | 2004 Contingencies in Consulting Contracts (%) Estimate: 0%
8. Percentage of contracts completed on time.
Bank's FY r 2000 | 2001 2002 2003 2004 Contracts Completed on time (%) ll
More than 80%: very satisfactory 60-80%: satisfactory 40-60%: unsatisfactory Less than 40%: very unsatisfactory
9. Percentage of contracts completed on budget.
Bank's FY 2000 2001 j 2002 2003 J 2004 Contracts Completed on budget (%) I
More than 80%: very satisfactory 60-80%: satisfactory 40-60%: unsatisfactory Less than 40%: very unsatisfactory
B. Output Indicators measure the quantity of goods and services provided through the use of inputs.
Project Components/Bank's FY 2000 2001 2002 2003 2004 Civil Works (km) Comprehensive Maintenance (km) Supervision (% of cost) Goods (% of cost) Consulting services (% of cost) Total _ Page 63
C. Outcome Indicators measure the quantity of direct results that have been achieved through the provision of project goods and services.
1. Vehicle Usage. Current and Estimated Future Traffic
Project ADT ADT (v.p.d) ADT (v.p.d) (v.p.d) Components 1998 2001 2004 Sections Current Planned Actual Planned Actual Abap6-Ipita 243 268 370 Ipita-Ipati 229 252 350 Ipati-Camiri 366 480 559 Bypassof Camiri 286 379 441 Accessto El Espino 35 50 59
ADT = Average Daily Traffic v.p.d. = vehicles per day
2. Road Condition. Comprehensive Maintenance Component
Current and Future Condition of Roads in the Comprehensive Maintenance Component 1999 2000 2001 2002 2003 TotalRoads KM % KM KM KM KM Condition1 37 4 14 0 0 0 Condition2 147 16 120 50 0 0 Condition3 458 51 230 194 94 0 Condition4 252 28 450 450 500 520 Condition5 0 0 80 200 300 374 TOTAL 894 100 894 894 894 894
3. Progress of routine maintenance by contract.
Maintenance by Contract Year Km. US$ equiv. 1999 2000 2001 2002 2003
4. Road Condition. National Road Network
Current and Future Condition of the National Road Network 1998 2001 2001 Planned Actual NationalRoad KM KM % KM Network(*) * Paved 2,532 37 * Gravel 3,853 56 Page 64
Current and Future Condition of the National Road Network 1998 2001 2001 Planned Actual * Earth 506 7 TOTAL 6,891 100
NationalRoad KM % KM % KM% Network(*) * Condition 1 213 3 * Condition 2 2,204 32 * Condition 3 3,130 45 * Condition 4 1,292 19 * Condition 5 52 1 TOTAL 6,891 100 Condition1: POOR Condition3: REGULAR Condition5: GOOD
(*) It includesonly the "maintainable"sections of the networkand excludesroads underconstruction or non existingyet.
5. Financing of Maintenance
Routine Road Maintenance Account (US$ millions) Calendaryear 1999 2000 2001 2002 1 2003 BudgetNeeds (US$) 20 21 21 22 23 AccountFunds (US$) 14.0 16 18 20 23
D. Impact Indicators measure the degree to which project objectives are being achieve through the direct outcomes of project activities.
I1. Objective: Improve Level of Service. Indicator: average speed on the Abap6-Camiri Highway.
Average Speed Vehicle Type Current Expected* (Km/h.) (Km/h.) Cars and Utility Sport 33 76 Buses 30 72 MediumTrucks 20 52 HeavyTrucks 17 64 ArticulatedTrucks 15 56 * When the civil works for Abapo-Camiri are completed.
2. Objective: reduce road user cost. Indicator: cost per vehicle-km on the Abap6-Camiri Highway.*
US$ per veh-km. Vehicle Type Curre Expected* ______n t Cars 0.58 0.19 Utility Sport 0.85 0.19 Buse5 1.73 0.88 MediumTrucks 1.01 0.40 Page 65
US$ per veh-km. Vehicle Type Curre Expected* fit Heavy Trucks 1.59 0.64 ArticulatedTrucks 2.13 0.94 * When the civil works for Abapo-Camiri are completed.
3. Objective: improve road safety. Indicator: Accidents (injuries and fatalities) on the Abap6-Camiri Highway.
Accidents/Bank's FY 1999 2000 2001 2002 2003 Accidentsper 100million veh-km InjuriesNeh-km FatalitiesNeh.-km
4. Objective: Improve Maintenance Efficiency. Indicator: Percentage allocated in the Comprehensive Maintenance by Contract Program
Percentage per Maintenance Type Type of Maintenance 1999 2000 2001 2002 2003 * Periodic (includes resurfacing) L_X_I * Routine |_| * Emergencies _ * Minor Works L Training _ Total Comprehensive Estimate: US$million 12.2 (TotalComprehensive) [100%]
(Routine) [26.9%];5.7 (Periodic) [47.9%l; 0.3 (Emergencies)[2.5%1; 0.4 (Minor Works) [3.4%1;2.3 (Training) [19.3%]
5. Objective: ensure adequate financing of maintenance. Indicator: planned, allocated and spent resources for maintenance in the national road network.
Type Resources allocated to Maintenance (US$ million) Of CY1999 CY2000 CY2001 CY2002 CY2003 Maintenance P A D P A D,D P P r D
Routine 20 21 21 22 23 Periodic 10 10 10 10 l1 Emergencies 1 1 1 1 1 1 Total 31 _ 32 _ 32 _ 1 . 3_3 |l34l
* P = Planned A = Approved D = Disbursed Page 66
Annex 11
Abap6 - Camiri Highway Project (ACA-HP)
Project Processing Budget and Schedule
A. Project Budget (US$000) Planned Actual (At final PCD stage) IDA Budget 200 Spanish Trust Fund 100
B. Project Schedule Planned Actual (At final PCD stage)
Time taken to prepare the project (months) 15 First Bank mission (identification) 10/07/1997 10/07/1997 Appraisal mission departure 02/21/1999 02/21/1999 Negotiations 03/08/1999 03/30/1999 Planned Date of Effectiveness 10/01/1999 10/01/1999
Prepared by: Bank staff in coordination with SNC personnel.
Preparation assistance: Spanish Consultant Trust Fund
Bank staff who worked on the project included: Name Specialty Jose Ma. Alonso-Biarge Senior Highway Engineer/Task Manager Zia Mian (until 5/31/98) Senior Operations/Officer/Alternate TM Alberto Nogales Infrastructure Project Officer Juan D. Quintero Environmental Specialist Estanislao Gacituta-Mari6 Social Specialist Rodrigo Archondo-Callao Economic Analysis David Varela Lawyer Paul Sisk Financial Management Specialist Paul Vandenheede Disbursement Officer Rauil Auzmendi Consultant, Transport Economist Salvador Pou Consultant, Maintenance Specialist Page 67
Annex 12
Abap6 - Camiri Highway Project (ACA-HP)
Documents in the Project File*
A. Project Implementation Plan
* Plan Preliminar de Implementaci6n del Proyecto Carretera Abap6 - Caminri,S.N.C., Departamento de Planificaci6n, La Paz, Diciembre, 1997.
B. Bank Staff Assessments
* Country Assistance Strategy of the World Bank Group for the Republic of Bolivia, C.M.U. Bolivia, Paraguay and Peru, May 21, 1998. * Bolivia, Country Assistance Review, Operations Evaluations Department, Report No. 17957, June 5, 1998. * Bolivia, Transport Sector Strategy, Infrastructure Operations Division, Department III, Report No. 11899-BO, June 30, 1993. * Implementation Completion Report - ICR for the Export Corridors Project, Infrastructure Operations Division, May 15, 1997.
C. Other
* Terminos de Referencia - Estudios de Factibilidad Tecnico - Econ6mica, Impacto Ambiental y Diseino Final de Ingenieria de la Carretera Abap6 - Camiri, S.N.C. Departamento de Planificaci6n, La Paz, Agosto 1994. * Decreto Supremo No. 25134 sobre la definici6n de la Red Vial Fundamental y la Constituci6n de la Cuenta de Conservaci6n Vial, Presidencia de la Repuiblica, Gaceta Oficial de Bolivia No. 2081, Agosto, 1998. - Documento de Precalificaci6n, Proyecto de Carretera Abap6 - Camiri, Obras Civiles y Pavimentaci6n de Carretera, S.N.C. Agosto 1998. * Documento de Precalificaci6n, Proyecto de Carretera Abap6 - Camiri, Componente de Mantenimiento, S.N.C. Agosto 1998. * Dialogo Nacional "Bolivia hacia el Siglo XXI" Informe y Conclusiones, RepuTblicade Bolivia, La Paz, Octubre, 1997. * "Bolivia hacia el Siglo XXI", Documento presentado por el Gobiemo de Bolivia al XI Grupo Consultivo, Paris, Francia, Abril, 1998. * Corredores de Integraci6n, Plan Quinquenal de Pre-Inversi6n e Inversi6n 1997 - 2002, Secretaria Nacional de Transportes, S.N.C., La Paz, Septiembre 1997. * Decreto Supremo No. 24327 que establece la normativa sobre el "Control de Cargas" para los vehiculos de transporte que circulan por las carreteras, Gaceta Oficial de Bolivia No. 1942, La Paz, 28 de Junio de 1996. * Ley No. 1874, Ley General de Concesiones de Obras Publicas de Transporte, Honorable Congreso Nacional, Repuiblica de Bolivia, La Paz, Junio, 1998. * Ley No. 1788, Ley de Reorganizacion del Poder Ejecutivo, Honorable Congreso Nacional, Repuiblicade Bolivia, La Paz, Septiembre, 1997. * Informe de la Fase I de la Re-Estructuraci6n del S.N.C., Consultora Booz Allen & Hamilton - CAEM Ltda., La Paz, Noviembre, 1997. * Inventario Vial de Mantenimiento de la Red Fundamental, Tomos I y II, S.N.C., Departamento de Mantenimiento, Julio, 1998. Page 68
* Estudio del Financiamiento del Mantenimiento de Carreteras, S.N.C., CAEM Consultores, La Paz, 1997. * Estadistica Vial - 1996, SN.C., Departamento de Planificaci6n y Estudios, La Paz, Octubre, 1997.
Documentos del Proyecto Carretera Abap6 - Camiri Elaborados por PCA lngenieros Consultores S.A, 1998-1999
* Memoria Descriptiva. Estudio de Factibilidad Tecnico - Econ6mica, Impacto Ambiental y Disefno Final de Ingenieria de la Carretera Abap6 - Camiri, P.C.A. Ingenieros Consultores S.A., Santa Cruz, 1998. * Contrato OC- 1: Tramo Abapo-Ipita, pliego de condiciones: VoluimenI: Condiciones Generales (Documento Preliminar) * Especificaciones del Proyecto, Volumen III. TOMO 1: Especificaciones Tecnicas Generales TOMO 2: Especificaciones Tecnicas Especiales TOMO 3: Especificaciones Tdcnicas Ambientales TOMO 4: Servicios de Campo para el Ingeniero TOMO 5: Construccion de Estaci6n de Pesaje * Estudio de evaluaci6n socio-econ6mica del estudio de factibilidad tecnico ecomomica, impacto ambiental y diseijo final de la Carretera Abap6-Camiri. Anexo I. Resultados Modelo HDM * Estudio de evaluaci6n socio-econ6mica del estudio de factibilidad tecnico ecomomica, impacto ambiental y disefio final del "Ramal Acceso El Espino". * Estudio de evaluaci6n socio-econ6mica del estudio de factibilidad tecnico ecomomica, impacto ambiental y disefnofinal de la "Circunvalaci6n a Camiri". * Evaluaci6n socio-econ6mica de la Carretera Abap6-Camiri. * Evaluaci6n socio-econ6mica del "Ramal Acceso El Espino". * Estudio de evaluaci6n de impacto ambiental consolidado incluyendo la carretera Abap6 - Camiri, el camino de acceso a El Espino y la Circunvalaci6n a Camiri. * Presupuesto, precios unitarios y costo de obra, La Paz, Enero 1999
*Including electronic files. Annex 13
STATEMEN OF LOANS AND CREDITS
As of 12-Apr-99
Difference Between expected Original Amount in US$ Millions and actual Fiscal disbursements a/ Project ID Year Borrower Purpose IBRD IDA Cancellations Undisbursed Orig Frm Rev'd
Number of Closed Projects: 55
Active Projects BO-PE-57030 1999 REPUBLIC OF BOLIVIA REG REFORM ADJ CREDI 0.00 41.78 0.00 19.81 -2.30 0.00 BO-PE-40085 1998 REPUBLIC OF BOLIVIA PARTICIP RURAL INV. 0.00 62.80 0.00 60.98 -. 34 0.00 BO-PE-40110 1998 MINISTRY OF FINANCE (MOF) FIN DECEN & ACCT 0.00 15.00 0.00 11.47 -. 42 0.00 BO-PE-55974 1998 GOVERNMENT OF BOLIVIA BO EL NINO EMERGENCY 0.00 25.00 0.00 16.06 2.54 0.00 0Q BO-PE-57396 1998 REPUBIC OF BOLIVIA REG REFORM TAC 0.00 20.00 0.00 20.22 .93 0.00 (B BO-PE-6204 1998 GOV OF BOLIVIA EDUCATION QUALITY 0.00 75.00 0.00 72.33 11.25 0.00 BO-PE-6186 1996 REPUB. OF BOLIVIA ENV.IND.& MINING 0.00 11.00 0.00 8.89 3.60 0.00 BO-PE-6191 1996 GOVERNMENT POWER SCTR REF TA & 0.00 5.10 0.00 1.66 1.96 0.00 BO-PE-6202 1996 GOVERNMENT OF BOLIVIA RURAL COMMUNITIES DE 0.00 15.00 0.00 .82 1.95 0.00 BO-PE-6206 1996 GOVT OF BOLIVIA RURAL WTR & SANIT 0.00 20.00 0.00 9.74 8.93 .67 BO-PE-6181 1995 GOV OF BOLIVIA EDUCATION REFORM 0.00 40.00 0.00 19.95 7.61 0.00 BO-PE-6197 1995 GOV OF BOLIVIA LAND ADMINISTRATION 0.00 20.40 0.00 6.41 -1.69 0.00 BO-PE-6205 1995 GOV'T. OF BOLIVIA JUDICIAL REFORM 0.00 11.00 0.00 4.55 3.65 0.00 BO-PE-6190 1994 GOVMT OF BOLIVIA MUNICIPAL DEV 0.00 42.00 0.00 8.27 7.63 0.00 BO-PE-6196 1993 GOV OF BOLIVIA INTEGRATED CHILD DEV 0.00 50.70 20.25 18.32 30.82 0.00 BO-PE-6180 1992 GOV'T OF BOLIVIA A RD MAINT 0.00 80.00 0.00 19.15 16.92 8.07
Total 0.00 534.78 20.25 298.63 93.04 8.74
Active Projects Closed Projects Total Total Disbursed (IBRD and IDA): 212.68 1,157.97 1,370.65 of which has been repaid: 0.00 294.96 294.96 Total now held by IBRD and IDA: 514.53 841.00 1,355.53 Amount sold 0.00 .05 .05 Of which repaid : 0.00 .05 .05 Total Undisbursed : 298.63 3.20 301.83
a. Intended disbursements to date minus actual disbursements to date as projected at appraisal.
Note: Disbursement data is updated at the end of the first week of the month and is currently as of 31-Mar-99. Page 70
STATEMENT OF IFC's
Held and DisbursedPortfolio As of 31-Mar-99 In Millions US Dollars
------Held------Disbursed------IFC------IFC------FY Approval Company Loan Equity Quasi Partic Loan Equity Quasi Partic
0 Minera 0.00 3.40 0.00 0.00 0.00 3.40 0.00 0.00 1976/88/90/91/95/98 BISA 12.00 4.70 0.00 0.00 12.00 3.16 0.00 0.00 1989/92/94/96 COMSUR 10.79 0.00 2.14 2.50 10.79 0.00 2.14 2.50 1991 Bermejo 0.00 5.90 0.00 0.00 0.00 5.14 0.00 0.00 1991 Central Aguirre .60 .35 0.00 0.00 .60 .35 0.00 0.00 1992 Inti Raymi 5.00 0.00 5.00 0.00 5.00 0.00 5.00 0.00 1993 GENEX .36 0.00 .72 0.00 .36 0.00 .72 0.00 1996 Mercantil-BOL 10.00 0.00 0.00 0.00 10.00 0.00 0.00 0.00 1996 Telecel Bolivia 10.00 0.00 5.00 20.00 6.67 0.00 5.00 13.33 1999 Los Andes 2.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Total Portfolio: 50.75 14.35 12.86 22.50 45.42 12.05 12.86 15.83
Approvals Pending Commitment
Loan Equity Quasi Partic 1999 ILLIMANI 15.00 1.00 0.00 0.00 Total Pending Commitment: 15.00 1.00 0.00 0.00 Page 71 Annex 14 Bolivia at a glance
POVERTYand SOCIAL AmerI middle. 8odhlib & Carib. icome Dewelopmentdiamond' 1997 Popuation,midyear (millions) 7.8 404 2.285 Lifeexpectancy GNPper capita(Atlas method, US$) 950 3,e80 1.230 GNP(Atlas method, US$ billions) 7.4 1,917 2,818 Averageannual growtth, 1991-97 Population(%J2.4 1.7 1.2 G G Laborforce (%) 2.6 2.3 1. GNP Gross per primary Mostrecent estimate (laltet year avaftabe, W9917) capta enrollment Poverty(% of populatbnbelow mnatlolpoeW wy) 87 Urbanpopulation (% of totalpopulation) 59 74 42 LiUeexpectancy at birth(years) 61 70 69 Infantmortality (per 1,000 rie bitths) 67 32 38 Childmalnutrition (% ofchildrw under 5) 9 .. ,, Accessto safewater Accessto safewater (% of population) 60 73 S4 Illiteracy(% of populationage 15+) 17 13 19 Grossprinary enrollment (% of schotl-agepopulaibon) 91 t11 111 via Male 95 18 - Lower-middle-incomegroup Female 87 .. 113 . . KEYECONOMIC RATIOS and LONG-TERM TRENDS 1976 19S6 1996 1997 - Economicratics GDP(US$ billions) 2.2 4.0 7.2 .7.8 Grossdomestic investment/GDP .. 13.6 16.6 19.8 Trade Exportsof goodsand services/GDP .. 21.3 22.9 21.0T Gross domesticsavingsGDP .. .. 11.2 12.3 Gross national savings/GDP .. .. 16.6 15.0 Currentaccount balance/GDP -2.6 4.1 .5,3 -8.3 Domesti Interestpayments/GDP 1.8 2.8 2.3 2.2 Savc Investment TotaldebtVGDP 58.6 140W8 72.1 67.6 Savings Totaldebt serviceexports 21.5 35.0 29.8 30.5 Presentvalue of debtWGDP .. .. 46.4 Present value of debtlexports .. .. 241.4 Indebtedness 197W6 1¶9747 1996 1997 199S42 (averageannual growth) GDP -2.7 4.1 4.1 4.2 5,3 -Bollvia GNPper capita .. 1.9 2.8 1.4 2.S Lower-middle-lncomegroup Fxports of goods and services -5.0 8.6 .6.7 *0.5. 8.7
STRUCTUREof the ECONOMY 1976 1966 1996 1997 Growthrats otoutput and Investment(%) (% of GDP) 45 Agriculture .. 28.5 14.1 14.1 Industry .. 51.9 29.2 27.9 3o Manufacturing ,, ,, 17.0 157 15s Services .. 19.6 56.7 58.0 o'
Privateconsumption .. 81.4 75.6 74.0 .-1 L 2 93 ss " 97 Generalgovemment consumption .. 9.4 13.1 13.7 GDI - | GDP Importsof goodsand services .. 25.7 28.3 28.5
(averageannual growth) 197646 1987-97 1996 1997 Growthrtes of exportsand Imports (% Agriculture .. 3.3 3.6 4.9 7- Industry 4.5 3.4 15Is Manufacturing .. 4.3 3.9 4.2 10 Services *- 3.9 4.4 4.5
Private consumption -0.5 3.0 2.4 3.9 o . _-, ,_ , , _ Generalgovernment consumption -4.4 2.9 1.0 3.89 . 2 95 Grossdomestic investment -4.1 7.8 20.9 23.8 Importsof goodsand services 1.6 6.0 9.7 10.3 - Exports lmports Gross national product .. 4.4 5.1 3.8 . _ _ .
Note:1997 data are preliminary estimates. The diamondsshow four keyindlcators in thecountry (in bold)compared with its inrome-groupaverage. If dataare missing, the diamond will be incomplete. Page 72
Bolivia
PRICESand GOVERNMENTFINANCE 1976 1986 1996 1997 Inflation(%) Domesticprices 20 (% change) 0 Consumer prices .. .. 7.9 6.7 15 Implicit GDP deflator . 211.4 8.9 7.9 10
Governmentfinance 5 (% of GDP,includes current grants) o Current revenue 18.7 26.3 24.1 92 93 94 95 96 97 Current budget balance .. 1.4 6.3 3.0 GDPdeflator CPI Overall surplus/deficit .. -3.3 -2.0 -3.3
TRADE (US$rnillions) 1976 1986 1996 1997 Export and Import levels (US$ millions) Total exports (fob) .. 588 1,132 1,167 2,000 Tin 104 86 81 Fuel 334 153 200 1,500 El Manufactures . . 144 183 Total imports (ci .. 674 1,568 1,810 1°000t Food - 148 188 Fuel and energy .. . 86 349 Capital goods .. .. 586 734 o 91 92 93 94 95 96 97 Export price index (1995=100) .- 156 104 106 Import price index (1995=100) .. 50 109 110 *Exports PImports Terms of trade (1995=100) , 310 95 96
BALANCEof PAYMENTS (US$rnv/lions) 11976 1986 1996 1997 Current account balanceto GDP ratio (%) Exports of goodsand services 623 704 1,318 1,362 0 Imports of goods and services 658 816 1,779 2,050 Resource balance -35 -112 -461 -688
Net income -36 -309 -168 -212 -4 Net current transfers 14 99 245 252 Current account balance -57 -321 -384 -648 Financingitems (net) 113 432 726 751 Changesin net reserves -56 -110 -342 -103 -10 I Memo: Reserves induding gold (US$millions) .. 505 1,125 1,192 Conversionrate (DEC,local/US$) 3.00E-5 1.9 5.1 5.3
EXTERNAL DEBT and RESOURCEFLOWS 1976 1986 1996 1997 (US$ millions) Compositlon of total debt, 1997(USS millions) Total debt outstandingand disbursed 1,290 5,575 5,200 5,284 IBRD 31 235 61 37 G:426 A: 37 IDA 53 97 843 930 B:930
Total debt service 137 251 413 453 F: 504 IBRD 4 38 32 24 IDA 1 2 8 10 C:248 Composition of net resourceflows Officialgrants 11 147 394 Official creditors 104 229 196 220 E: 1,421 Private creditors 143 -4 44 -29 Foreign direct investment -8 10 426 591 Portfolio equity 0 0 0 0 D.718 World Bank program Commitments 68 72 59 15 A -IBRD E - Bilateral Disbursements 16 7 100 136 B-IDA D- Othermultilateral F - Private Principal repayments 2 19 28 23 C - IMF G - Short-term Netflows 14 -12 72 113 Interest payments 2 20 12 11 Net transfers 12 -32 59 102
DevelopmentEconomics 10/1/9B IBRD30220 680 660 -- 640 620 60O 10O
10° B R A Z I L BOLIVIA TRANSPORTATIONNETWORK MAIN ROADS i_° -to MAIN RAILROADS ACob 9H J * NATIONALCAPITAL
\' (Porvenir. A R ®vJ3 DEPARTMENTCAPITALS 12° 120 lanca FB 0 SELECTEDTOWNS
D\t J g \ i, / - DEPARTMENTBOUNDARIES Pto.Heath I I*LI ,Mdidi Nno i o?dN 1< Bg N0 I05UGo l .' X SJ 45. rj~~~~~~~~~qouc. , C'L./ t&!,So?I 14°-E~ 14'~~ ~~ ~ ~ ~ ~ ~ ~ ~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~4 14° lixiBmaiS ,. /' o'r 90\l l) <>\ B R A Z I L f Apolo 8 Rurrenabaque / Trinidad '- -t-<;t 1 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~16'- t Coroic>oro2' ' +,Patocama \)Puerh Banegas > T n '~~Cor~ci~m Matoroni>\ 2 C O Pto.C ViIIarroetv @ Ae vQ e, 9 / CSnRFe CQurrnavi oresui a tVrOc c ,Qny VilabombatCiiv Xf/t CA N~orU 7So Coa1 Pisige~~~~~~~~~~~~~~~Potosi0* ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~~~Sn rsii HuarinaTRi o 60c /' \ / E .> XBalSce 2 I Yacuiba)/ > i~~~~~~~- an a e T, ~/.I Atoch ° e.d -- a Cabezas~ ~ ~ ~ ~ ~ ~ ~ ~ ~ A 19 ' utsr8 ToSlotar\ To . .... N. , -1 Coro toca l COCEmborcaci6n *, Cu,0., C HI LE :A RG EN T INA |4 ,Cochbmo Thismap was produced by theMop Design Unit of TheWorld Bank. i~C;, i \ | AJp i~ 24 Theboundaries, colors,denorminations and anyother informationshown 24° rF-ILE- . ~.. 2J14 on thismap dad notnotimplyimply, on thete=parpart of TheTe WorldWord BankBon\Grou, Group, onyan Annthtomop 0 50 100 150 200 250 judgmenton the legolstatus ofony territory,or any endorsementor to 90s° r Asunci6n , I I acceptanceofsuch boundaries. I S°TcHgUn g t KILOMETERS (2 Rcsistencid''ron i ~~~~68' 66° 64° 62' AR GENT I NA /c,, lge R Pu 19A 9 IBRD30221 BOLIVIA 63a Piray SanRam6n Sn Julian ABAPO-CAMIRI HIGHWAY PROJECT Chanc Los Cafes S~~~~~~~~~~~~~~~~~~~~~~~Independencia 17 MiIIu CCHAB4~MBJ4 ubir6 Quilac ba Ma Ti ue YM"can Buena Ware e^ ~~---9%aChocoAJV Carmer X Epizana ') - Vista.1 Pto. Challa ra i ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~Pailas Co inolaTraPootoc ;ai AnzaldolL,,_,e \f amarapa La Guard Santa Cruz omaraapapao aiqui} vasio>rnngostur > S A N TA Huinuni g\ 1E x CR UZ Uncia \ A ><< '' 8t~~~~~~~~~~~ ~ ~~~~~~~~~~~~~~Vallegadt Col uechacaa PuenteAr '0 o0 Guadalupe \ apoip }+ ffi )) P~~~~~~~~~~~~~~ucara bpohie Mach ~~~~~~~~~~~~~~~~Abapo NuevoMundo Mas r ) abi 19, 'k OT05iSucre Zuc~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~9 cia\El Padilla Espino CAMIRIHIGHWAY (COMPONENTAl A) Incahuasi CruceIpati t Charagua ------ELESPINO ACCESS ROAD (COMPONENT B Trvit Monteaud _ BRIDGEOVER RIO GRANDE Arduy Muyupampa COMPREHENSIVEMAINTENANCE ' Pzur 20°- (COMPONENTC) I Camiri r MAIN ROADS CHU UISACA MAIN RAILROADS : DEPARTMENTCAPITALS Huacareta Cv, ui6e - - - - DEPARTMENTBOUNDARIES ° INTERNATIONALBOUNDARIES Sta.Elena B R A Z I L ROADS S +,5 RAILROADS Huacaya Cobijo / NATIONALff : &@CAPITAL Culpina bi.%o/ N4,<~ DEPARTMENTBOUNDARIES 21° / 421° \E.--- INTERNATIONALBOUNDARIES * N NI , :e/ <-tpsf t- - E . A V~~~~~~~~~~Montes ~ ~ ~~~~~~~~illa KBRAZIL Tom~~atas 9LaPaz>CgCH^QM£Bs0 -- SA N A BPadcayaRA CampoPajosoa 2rI * I,ur - ' on Thismap dw at opry,oduetyhe pa,-eig o nt/ CHLE Sj I t.Wria;A/I PARAGUAY t) (t' 50cehcefuhouds10 5 ;I N _vv---4---_V_>mAp FortinCanperon 64° KILOMETERS630 MAY 1999