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World Bank Document Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No: 47593-MA PROJECT APPRAISAL DOCUMENT ON A Public Disclosure Authorized PROPOSED LOAN IN THE AMOUNT OF EUROS 105.2 MILLION AND US$35 MILLION (US$175 MILLION EQUIVALENT) TO THE OFFICE NATIONAL DE L’EAU POTABLE (ONEP) (NATIONAL POTABLE WATER AUTHORITY) WITH THE GUARANTEE OF THE Public Disclosure Authorized KINGDOM OF MOROCCO FOR A REGIONAL POTABLE WATER SUPPLY SYSTEMS PROJECT May 20, 2010 Sustainable Development Department Middle East and North Africa Region Public Disclosure Authorized This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective {November 3, 2009}) Currency Unit = Moroccan Dirham (MAD) MAD 7.6277 = US$1 US$ 0.1311 = MAD 1 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS CAS Country Assistance Strategy CPS Country Partnership Strategy CR Rural Municipality/Commune Rurale DEP Department for Access to Potable Water (ONEP)/Dir. Généralisation de l’Eau Potable DGCL General Department of Local Communities/Direction Générale des Collectivités Locales DGH General Department of Hydraulics/Direction Générale de l’Hydraulique DPL Development Policy Loan EA Environmental Assessment ESMP Environmental and Social Management Plan ESW Economic and Sector Work FMR Financial Monitoring Report FRR Financial Rate of Return GEP Universal Water Access Programme/Programme de Généralisation de l’Eau Potable GG Managing keeper/Gardien Gérant GOM Government of Morocco HC Household Connection IBRD International Bank for Reconstruction and Development INDH Initiative Nationale de Développement Humain (National Human Development Initiative) LAF Land Acquisition Framework MDG Millenium Development Goals MEMEE Ministry of Energy, Mines, Water and Environment MENA Middle East and North Africa MIC Middle-Income Country NCB National Competitive Bidding O&M Operation and Maintenance ONEP National Potable Water Board/Office National de l’Eau Potable PAGER Rural Water Supply Program/Programme d’Approvisionnement Groupé en Eau Potable des Populations Rurales PDO Project Development Objective PHRD Japan Policy and Human Resources Development Technical Assistance Program RWS Rural Water Supply RWSS Rural Water Supply and Sanitation SEEE Secretariat of Water and Environment – Secrétariat d’Etat a l’Eau et de l’Environnement SIL Specific Investment Loan SMT Social Mobilization Team SP Standpipe (public) WSS Water Supply and Sanitation WUA Water User’s Association Vice President: Shamshad Akhtar Country Director (Acting): Francoise Clottes Sector Director Laszlo Lovei Sector Manager: Francis Ato Brown Task Team Leader: Pier Francesco Mantovani KINGDOM OF MOROCCO MA-Regional Potable Water Supply Systems Project TABLE OF CONTENTS Page I. STRATEGIC CONTEXT AND RATIONALE ................................................................. 1 A. Country and sector issues.................................................................................................... 1 B. Rationale for Bank involvement ......................................................................................... 3 C. Higher level objectives to which the project contributes .................................................... 4 II. PROJECT DESCRIPTION ................................................................................................. 5 A. Lending instrument ............................................................................................................. 5 B. Project development objective and key indicators .............................................................. 5 C. Project components ............................................................................................................. 5 D. Lessons learned and reflected in the project design ............................................................ 8 E. Alternatives considered and reasons for rejection .............................................................. 9 III. IMPLEMENTATION ...................................................................................................... 9 A. Institutional and implementation arrangements .................................................................. 9 B. Monitoring and evaluation of outcomes/results ................................................................ 10 C. Sustainability..................................................................................................................... 11 D. Critical risks and possible controversial aspects ............................................................... 12 E. Loan/credit conditions and covenants ............................................................................... 14 IV. APPRAISAL SUMMARY ............................................................................................. 17 A. Economic and financial analyses ...................................................................................... 17 B. Technical ........................................................................................................................... 19 C. Fiduciary ........................................................................................................................... 19 D. Social................................................................................................................................. 21 E. Environment ...................................................................................................................... 22 F. Safeguard policies ............................................................................................................. 24 G. Policy Exceptions and Readiness...................................................................................... 24 Annex 1: Country and Sector or Program Background ......................................................... 25 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ................. 31 Annex 3: Results Framework and Monitoring ........................................................................ 32 Annex 4: Detailed Project Description ...................................................................................... 36 Annex 5: Project Costs ............................................................................................................... 46 Annex 6: Implementation Arrangements ................................................................................. 49 Annex 7: Financial Management and Disbursement Arrangements ..................................... 51 Annex 8: Procurement Arrangements ...................................................................................... 58 Annex 9: Economic and Financial Analysis ............................................................................. 64 Annex 10: Safeguard Policy Issues ............................................................................................ 78 Annex 11: Project Preparation and Supervision ..................................................................... 94 Annex 12: Documents in the Project File ................................................................................. 95 Annex 13: Statement of Loans and Credits .............................................................................. 97 Annex 14: Country at a Glance ................................................................................................. 98 KINGDOM OF MOROCCO MOROCCO REGIONAL POTABLE WATER SUPPLY SYSTEMS PROJECT APPRAISAL DOCUMENT MIDDLE EAST AND NORTH AFRICA MNSSD Date: May 20, 2010 Team Leader: Pier Francesco Mantovani Acting Country Director: Françoise Clottes Sectors: Water supply (100%) Sector Manager/Director: Francis Ato Brown Themes: Rural services and infrastructure (80%); Access to urban services and housing (20%) Project ID: P100397 Environmental category: Partial Assessment Lending Instrument: Specific Investment Loan Joint IFC: Joint Level: Project Financing Data [X] Loan [ ] Credit [ ] Grant [ ] Guarantee [ ] Other: For Loans/Credits/Others: Total Bank financing (US$m.): 175.00 Proposed terms: US dollar denominated IBRD commitment linked flexible loan with a variable spread and a maturity of 30 years including a 5 year grace period with level repayments. Financing Plan (US$m) Source Local Foreign Total Borrower 41.00 0.00 41.00 IBRD 0.00 175.00 175.00 Total: 41.00 175.00 216.00 Borrower: Office National de l'Eau Potable (ONEP), Rabat, Morocco With a guarantee by the Government of Morocco Responsible Agency: Office National de l'Eau Potable (ONEP) Station de Traitement Avenue Mohamed Belhassan El Ouazzani Rabat , Morocco Tel: (212-537) 650-695 Fax: (212-537) 759-106 Estimated disbursements (Bank FY/US$m) FY 2010 2011 2012 2013 2014 2015 Annual 0.00 14.00 56.00 54.00 43.00 8.00 Cumulative 0.00 14.00 70.00 124.00 167.00 175.00 Project implementation period: Start August 2, 2010 End: December 31, 2015 Expected effectiveness date: July 15, 2010 Expected closing date: December 31, 2015 Does the project depart from the CAS in content or other significant respects? [ ]Yes [X] No Ref. PAD I.C. Does the project require any exceptions from Bank policies? Ref. PAD IV.G. [ ]Yes [X] No Have these been approved by Bank management? [ ]Yes [ ] No Is approval for any policy exception sought from the Board? [ ]Yes [X] No Does the project include any critical
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