Metropolitan Bogor, Tangerang, and Bekasi Urban Development (Sector) Project

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Metropolitan Bogor, Tangerang, and Bekasi Urban Development (Sector) Project Performance Evaluation Report Reference Number: PPE:INO 2009-58 Project Number: 29446 Loan Number: 1511-INO December 2009 Indonesia: Metropolitan Bogor, Tangerang, and Bekasi Urban Development (Sector) Project Independent Evaluation Department CURRENCY EQUIVALENTS Currency Unit – rupiah (Rp) At Appraisal At Project Completion At Independent Evaluation (31 October 1996) (30 September 2003) (11 March 2009) Rp1.00 = $0.00043 $0.00011 $0.000083 $1.00 = Rp2,327 Rp9,000 Rp11,912 ABBREVIATIONS ADB – Asian Development Bank AFC – Asian financial crisis BAPEDAL – Badan Pengendalian Dampak Lingkungan (local government environmental agency) BAPPENAS – Badan Perencanaan Pembangunan Nasional (national development planning agency) BME – benefit monitoring and evaluation BOT – build-operate-transfer BOTABEK – Bogor, Tangerang, and Bekasi BTOR – back-to-office report CDM – clean development mechanism DED – detailed engineering design DGHS – Directorate General of Human Settlements DGURD – Directorate General of Urban and Rural Development EA – executing agency EIRR – economic internal rate of return FDS – final disposal site FIRR – financial internal rate of return IED – Independent Evaluation Department IEM – Independent Evaluation Mission IPLT – sludge processing plant IUIDP – integrated urban infrastructure development project KIP – kampung improvement program LG – local government LIDAP – local institutional development action plan MDG – Millennium Development Goal MIIP – market infrastructure improvement program MOHA – Ministry of Home Affairs MOHARA – Ministry of Home and Regional Affairs MPW – Ministry of Public Works MSRD – Ministry of Settlements and Regional Development NRW – nonrevenue water OED – Operations Evaluation Department O&M – operation and maintenance ODA – official development assistance PCR – project completion report PDAM – Perusahaan Daerah Air Minum (local government water supply enterprise) PPER – project performance evaluation report PPTA – project preparatory technical assistance PSP – private sector participation RIAP – revenue improvement action plan SLA – subsidiary loan agreement SPAR – subproject appraisal report STP – sewerage treatment plants SWM – solid waste management TPA – Tempat Pembuangan Akhir (final solid waste disposal site) WEIGHTS AND MEASURES km – kilometer l – liter lpcd – liters per capita per day 3 mP /dayP – cubic meters per day m – meter NOTE In this report, “$” refers to US dollars. KEYWORDS indonesian urban development evaluation, indonesia water supply project evaluation, indonesia local authority water supply and sanitation, indonesian public health, kampung improvement program, adb, evaluation, asian development bank, public hygiene Director General H.S. Rao, Independent Evaluation Department (IED) Director H. Hettige, Independent Evaluation Division 2, IED Team leader T. Ueda, Senior Evaluation Specialist, Independent Evaluation Division 2, IED Team members R. Lumain, Senior Evaluation Officer, Independent Evaluation Division 2, IED R. Isidro, Operations Evaluation Assistant, Independent Evaluation Division 2, IED Independent Evaluation Department, PE-730 In preparing any evaluation report, or by making any designation of or reference to a particular territory or geographic area in this document, the Independent Evaluation Department does not intend to make any judgments as to the legal or other status of any territory or area. CONTENTS Page BASIC DATA i EXECUTIVE SUMMARY iii I. INTRODUCTION 1 A. Evaluation Purpose and Process 1 B. Expected Results 1 II. DESIGN AND IMPLEMENTATION 1 A. Formulation 1 B. Rationale 2 C. Cost, Financing, and Executing Arrangements 3 D. Procurement, Construction, and Scheduling 4 E. Design Changes 5 F. Outputs 5 G. Consultants 11 H. Loan Covenants 11 I. Policy Framework 12 III. PERFORMANCE ASSESSMENT 13 A. Overall Assessment 13 B. Relevance 14 C. Effectiveness 15 D. Efficiency 15 E. Sustainability 16 IV. OTHER ASSESSMENTS 16 A. Impacts 16 B. Asian Development Bank Performance 18 C. Borrower Performance 19 V. ISSUES, LESSONS, AND FOLLOW-UP ACTIONS 20 A. Issues 20 B. Lessons 21 C. Follow-Up Actions 22 The guidelines formally adopted by the Independent Evaluation Department (IED) on avoiding conflict of interest in its independent evaluations were observed in the preparation of this report. Robert Merrill and Iwan Widodo were the consultants. To the knowledge of the management of IED, there were no conflicts of interest of the persons preparing, reviewing, or approving this report. APPENDIXES 1. Project Design and Monitoring Framework and Assessment Results at Project 23 Completion and Performance Evaluation 2. Project Costs, Financing, and Achievements 27 3. Project Facilities during Independent Evaluation Mission Visits 32 4. Summary of Benefit Monitoring and Evaluation Results 35 5. Status of Compliance with Loan Covenants 39 6. Overall Performance Assessment 49 7. Economic Reevaluation 50 8. Financial Reevaluation 57 9. Achievement of Millennium Development Goals Related to Water Supply and Sanitation Sector 63 10. Highlights of the Socioeconomic Survey 70 BASIC DATA Loan 1511-INO: Metropolitan Bogor, Tangerang, and Bekasi Urban Development (Sector) Project Project Preparation and Institution Building TA No. TA Name — None As per ADB Key Project Data ($ million) Loan Documents Actual Total Project Cost 228.00 74.57 Foreign Exchange Cost 65.00 22.98 Local Currency Cost 163.00 51.59 ADB Loan Amount/Utilization 80.00 39.69 ADB Loan Amount/Cancellation 0.00 40.31 Key Dates Expected Actual Fact-Finding 7–31 May 1996 Appraisal 19 Aug–20 Sep 1996 Loan Negotiations 18–20 Nov 1996 Board Approval 19 Dec 1996 Loan Agreement 10 Jan 1997 Loan Effectiveness 10 Apr 1997 13 Mar 1997 First Disbursement 13 May 1997 Project Completion 30 Sep 2002 30 Sep 2003 Loan Closing 30 Sep 2002 4 Mar 2004 Months (effectiveness to completion) 66 79 Internal Rates of Return (%) At Appraisal PCR PPER Financial Internal Rate of Return Water Supply 3.1−7.4 7.9−16.8 11.4−23.1 Sanitation nc 1.3−17.2 nc Solid Waste nc -0.6−7.8 nc Economic Internal Rate of Return Water Supply nc 16.5−37.3 20.7−44.5 Road Betterment 45.7 2.2−56.2 4.6−30.6 Road Widening 18.0−32.9 24.6−52.7 17.4−32.8 New Roads 31.2−38.3 nc nc Drains 30.4−44.3 1.7−2.6 nc Kampung Improvement 25.9 nc nc Borrower Republic of Indonesia Executing Agency Directorate General of Urban and Rural Development in the Ministry of Settlements and Regional Development Mission Data Type of Mission No. of Missions No. of Person-Days Fact-Finding 1 250 Appraisal 1 256 Project Administration 7 99 Inception 1 12 Review 4 44 Midterm Review 1 29 Special Loan Administration 1 14 Project Completion 1 21 Independent Evaluation 1 55 nc = not calculated, PCR = project completion report, PPER = project performance evaluation report. EXECUTIVE SUMMARY The Independent Evaluation Department (IED) included evaluation of the Metropolitan Bogor, Tangerang, and Bekasi (BOTABEK) Sector Project in its annual work program for 2009 in order to gather information for its review of the urban sector in Indonesia. This evaluation is based on a review of project documents and other studies, and on the findings of the Independent Evaluation Mission (IEM), which visited Indonesia from 4 to 21 March 2009. The IEM consulted relevant national agencies including the National Statistics Office and four local authorities and their PDAMs. Jakarta’s Metropolitan region, known as JABOTABEK, comprises Jakarta itself plus BOTABEK. The population of Jakarta, the capital of Indonesia and the largest metropolis (660 square kilometers) in Southeast Asia, has grown rapidly during the last 20 years. In 1994, Jakarta city had a population of 11.5 million. The annual population growth rate was 4.3% between 1990 and 1995. The pressure of this growing population and the accompanying environmental deterioration in the city led to suburbanization or the movement from the central city to the peripheral areas including BOTABEK. The project had two major parts: institutional development and physical investments in subprojects. It had these objectives: (i) Enhance the capacity of sector institutions. This refers particularly to the perusahaan daerah air minum (PDAMs) or local government water supply enterprises to enable them to (a) provide, operate, maintain, and finance urban infrastructure services; (b) join the private sector in providing such services; and (c) manage the urban environment. (ii) Accelerate the provision of essential urban infrastructure in the project area. The project scope included rehabilitating and expanding infrastructure services such as water supply; roads and bridges; drainage, solid waste, and sanitation; kampung (informal settlement in the urban peripheries) and market infrastructure improvement; and bus terminals. The expected impacts were (a) improved living and health conditions; (b) improved institutional, provincial and municipal capacities; and (c) assistance to the government's urban policies through an integrated urban infrastructure development project (IUIDP). On 19 December 1996, the Asian Development Bank (ADB) approved a second phase to an existing project as many new development areas had emerged since the formulation of the earlier first-phase BOTABEK Urban Development Project. The previous BOTABEK project was appraised in June 1990, approved in January 1991, and completed in December 1996. Thus, just when the previous BOTABEK project was about to close, the follow-on Metro BOTABEK project was approved. Both projects were classified as multisector. In
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