World Bank Document
Total Page:16
File Type:pdf, Size:1020Kb
Document of The World Bank Public Disclosure Authorized Report No 25615 IMPLEMENTATION COMPLETION REPORT (CPL-35450; TF-25931; SCL-36050) ON A LOAN Public Disclosure Authorized IN THE AMOUNT OF US$ 130 MILLION TO THE ARAB REPUBLIC OF EGYPT FOR A PRIVATE SECTOR TOURISM INFRASTRUCTURE & ENVIRONMENTAL MANAGEMENT PROJECT Public Disclosure Authorized March 21, 2003 Public Disclosure Authorized CURRENCY EQUIVALENTS (Exchange Rate Effective ) Currency Unit = Egyptian Pound (LE) US$ 1.0 = LE 3 33 (at appraisal) US$ 1.0 = LE 4.64 at ICR FISCAL YEAR Calendar Year ABBREVIATIONS AND ACRONYMS ASD - Abu Soma Development Company BOO - Build/Own/Operate CZM - Coastal Zone Management EEAA - Egyptian Environmental Affairs Agency GEF - Global Environmental Facility GOE - Government of Egypt ICR - Implementation Completion Report IFC - International Finance Corporation NCISS - Nile Cruise Information and Safety System SAR - Staff Appraisal Report TA - Technical Assistance TDA - Tourism Development Authonty USAID - United States Agency for Intemational Development Vice President: Jean-Louis Sarbib Country Director: Mahmood A. Ayub Sector Director: Emmanuel Forestier Task Team Leader: Nicole Glineur/Jim Reichert EGYPT, ARAB REPUBLIC OF PRIVATE SECTOR TOURISM INFRASTRUCTURE & ENVIRONMENTAL MANAGEMENT PROJECT CONTENTS Page No. I Project Data I 2 Principal Performance Ratings I 3 Assessment of Development Objective and Design, and of Quality at Entry 2 4 Achievement of Objective and Outputs 7 5 Major Factors Affecting Implementation and Outcome 9 6 Sustainability 10 7 Bank and Borrower Perfomiance 11 8 Lessons Learned 12 9 Partner Comments 13 10 Additional Information 18 Annex I Key Performance Indicators/Log Frame Matrix 19 Annex 2 Project Costs and Financing 20 Annex 3 Economic Costs and Benefits 22 Annex 4 Bank Inputs 23 Annex 5 Ratings for Achievement of Objectives/Outputs of Components 25 Annex 6 Ratings of Bank and Borrower Performance 26 Annex 7 List of Supporting Documents 27 Annex 8 List of People Consulted 28 Project ID P005168 Project Namle PVT SEC TOURISM INF & ENV Teamii Leader. Douglas I Graham TL Unit MNSIF ICR Tvpe Core ICR |Report Date March21, 2003 1. Project Data Name PVT SEC TOURISM INF & ENV L/C/TF Number CPL-35450, TF-2593 1, SCL-36050 Countrv/Department ARAB REPUBLIC OF EGYPT Region Middle East and North Africa Region Sector/subvector Roads & highways (24%), General water/sanitation/flood protection sector (24%), Power (24%), Telecommunications (24%), Central govcrnment administration (4%) KEY DATES Original Revised/Acttual PCD 04/28/1989 Effrctive 12/27/1993 03/27/1995 Appraisal 05/01/1992 MTR 02/15/1996 04/22/1998 Approval 05/18/1993 Closing. 12/31/2000 10/17/2002 Borrower/lnplenientingAgency Tourism Development Authority (TDA)/TDA Other Partners Abu Soma Development Company STAFF Currcnt At Appraisal Vice President Jean-Louis Sarbib Caio Koch-Weser Count, Manager' Mahmood A Ayub Ram K Chopra Sector Manager Hedi Larbi Alastair J Mckechnie Team Leader at ICR Jim Reichert Arun BanerJee ICR Primary Autl7or Douglas I Graham 2. Principal Performance Ratings (HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, I-UN=Highly Unlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible) Outcome U Sustainability L Instit ttional Development Impact M Bank Performance S Borrower Performance S QAG (if available) ICR Quality at Entm)y U Project at Risk at Any Tune Yes 3. Assessment of Development Objective and Design, and of Quality at Entry 3 1 Original Objective 3.1.1 In the early 1990s, the Government of Egypt (GOE) was poised to embark on a major program of privatization. The tounsm sector, with its potential for growth in terms of underutilized natural and cultural resources and its ability to generate employment and foreign exchange earnings, was a particularly strong candidate to lead the program. It also had the advantage of having no strongly entrenched interests opposed to pnvatization. At the time, Egypt's evolving tourism strategy focused on the need to diversify to new areas of beach tourism, while strengthening infrastructure facilities in existing areas of cultural tounsm and involving the private sector in the environmentally sustainable development of all areas. 3.1.2 To help meet the overall goals of the Government's tounsm development strategy, the objectives of the project, as stated in the Staff Appraisal Report (SAR), were to (a) support the Government in improving the policy environment for the tourism sector through further investnent rationalization, deregulation and privatization of the tounsm portfolio; (b) provide catalytic financial support for infrastructure development in major tourist areas sponsored by the prnvate sector in order to mobilize long-term financing from commercial banks and venture capital for equity investments; and (c) ensure sound environmental management of the Red Sea coast with the support of the GEF. Assessment of Original Objective and Design 3.1.3 The tourism sector in Egypt had, and continues to have, great development potential in terms of well located, underutilized natural and cultural resources, which can be relatively easily developed to generate employment and foreign exchange earnings. The project objectives, combining the main thrust of development through the private sector with sound environmental management, were appropriate to help the Government reach its goals in the sector. They were also consistent with the Bank's Country Assistance Strategy, which gave high priority to projects that increased employment and foreign exchange earmings, and which encouraged a shift from public sector to private sector development of tourist infrastructure. 3.1.4 The project was ambitious and complex in the range of reforms it sought to accomplish, and risky in its institutional structure, channelling proceeds from the Bank Loan through the relatively new and untried Tourism Development Authority (TDA), which then onlent the proceeds to private developers. The TDA, which was established in 1991 and charged with managing private investment in the tourism sector, had little experience in private sector management. In addition to changes in the policy and regulatory environments, the project also sought to facilitate a wide range of private sector investments as examples of investor participation in sector related activities. The investment components were not always appropriate for profitable operation by the private sector, and they were too many and too diverse to be handled by a new and inexperienced institution like TDA. 3.2 Revised Objective N/A 3 3 Original Comnponents- -2 - 3.3.1 The onginal project components as stated in the SAR were (a) rinplementation of measures to improve the policy environment In the tourism sector consistinig of (i) development of an overall framework for public and private sector investments; (n) liberalization of prices for tourism related services, (iii) development of land allocation and ownership policies for plivate investments; and (iv) improvements in the regulatory framework affecting the operation of the tourism sector, (b) Financial support through loans for: (i) development of infrastructure for two integrated area development sub-projects on greenfield sites on the Red Sea coast at Ras Abu Somna and Sal Hasheesh, sponsored by two private companies; (ii) development of infrastructure to provide water supply, sewerage and solid waste collection and disposal facilities for tourist developments on the Red Sea Coast (South Hurghada to Safaga area) by the private sector; (iii) Nile cruise infrastructure - the provision of berthing facilities for Nile cruise vessels in Luxor and Aswan and the provision of a navigation system ( the Nile cruise infonnation and safety system, NCISS); (iv) improved access to tourism sites in upper Egypt, (c) A GEF grant financed component to maintain Red Sea blo-diversity and protect its natural environment through the development of a coastal zone management plan, and initiate the implementation of a plan for the Red Sea coast, particularly as it affected the protection of the marnne habitat in tounst areas to be developed under the project; and (d) Provision of technical assistance and training for staff at TDA and the Egyptian Enviromnental Affairs Agency (EEAA) to strengthen capacity in: (i) tourism plaining and marketing; (n) procurement and financial management; (iii) development of enviromnental guidelines and capacity for monitoring and enforcement of environmental rules and guidelines in tourism zones; (iv) preparation of projects to promote further tourism development. 3.3.2 The components were reasonably related to the Governuent's policy objectives, which were broadly achieved. The first component responded to the objective of supporting the Governmnent in improving the policy environment for the sector, while the second component responded to the second objective of providing catalytic financial support for infrastructure development by the private sector. The third component related specifically to the third objective of ensuring sound environmental management of the Red Sea coast, while the fourth component was intended to strengthen the implementing agencies to carry out the first three components 3 3 3 The capacity of the implementing agency, the TDA, was not sufficient to implement all the components, and in particular, to manage the complex financing arrangements involved in the large number of investments with the pnvate sector.