Document of The World Bank
FOR OFFICIAL USE ONLY
Public Disclosure Authorized Report No: 43081-BJ
PROJECT PAPER
ON A
PROPOSED ADDITIONAL CREDIT
Public Disclosure Authorized IN THE AMOUNT OF SDR 24.3 MILLION (US$40.0 MILLION EQUIVALENT)
TO THE
REPUBLIC OF BENIN
FOR THE
SECOND DECENTRALIZED CITY MANAGEMENT PROJECT
Public Disclosure Authorized May 2 1,2008
Water and Urban I1 Country Department AFCF2 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 mav not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS
(Exchange Rate Effective March 3 1,2008) Currency Unit = CFA franc (CFAF) US$1.O = CFAF 440 SDR 1.0 = US$1.64664 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS AADT Average Annual Daily Traffic ABE Benin Environmental Protection Agency (Agence be'ninoisepour 1'environnement) AFD French Development Agency (Agencefranqaise de diveloppement) AGETUR Public Works Executing Agency (Agence d 'exicution des travaux urbains) APL Adaptable Program Loan CAS Country Assistance Strategy CFAF CFAFranc CISU Community Initiative Support Unit COSUCO Steering Committee (Comite' de suivi, de coordination et d 'orientation) ECOWAS Economic Community ofWest African States EL4 Environmental Impact Assessment ERR Economic Rate ofReturn ESMF Environmental and Social Management Framework EU European Union GOB Government ofBenin HDM Highway Development and Management Model ICR Implementation Completion Report IDA International Development Association IEG Independent Evaluation Group IFR Interim Financial Report KfW German Bank for Cooperation (Kreditanstaltfir Wiederaufbau) LSC Local Steering Committees MDG Millennium Development Goal NDC Neighborhood Development Committee NPV Net Present Value OED Operations Evaluation Department PAACO Cotonou Agglomeration Support Program (Programme d 'appui a 1 'agglorniration de Cotonou) PDO Project Development Objective PRS Poverty Reduction Strategy RAP Resettlement Action Plan RED Roads Economic Decision Model RPF Resettlement Policy Framework SDR Special Drawing Rights sss Single Source Selection Vice President: Obiageli Katryn Ezekwesili Acting Country Director: Antonella Bassani Sector Manager: Eustache Ouayoro Task Team Leader: Franck Bousquet FOR OFFICIAL USE ONLY
BENIN SECOND DECENTRALIZED CITY MANAGEMENT PROJECT ADDITIONAL FINANCING
CONTENTS
Page A . INTRODUCTION ...... 1 B. BACKGROUND AND RATIONALE FOR ADDITIONAL FINANCING ...... 1 C . PROPOSED CHANGES ...... 5 D. CONSISTENCY WITH CAS AND PRS ...... 6 E. APPRAISAL OF RESTRUCTURED OR SCALED-UP PROJECT ACTIVITIES ...... 7 F. EXPECTED OUTCOMES ...... 9 G. BENEFITS AND RISKS ...... 9 H. FINANCIAL TERMS AND CONDITIONS ...... 10 TECHNICAL ANNEX ...... 12 Detailed description of the Additional Financing ...... 12 Implementation arrangements...... 14 Fiduciary arrangements...... 15 Social aspects ...... 18 Complementarity with other donor-financed interventions ...... 19 APPENDIX A: PROJECT PREPARATION AND TIMETABLE OF KEY EVENTS ...... 21 APPENDIX B: MONITORING INDICATORS ...... 22 APPENDIX C: DETAILED PROJECT COSTS ...... 27 APPENDIX D: ECONOMIC AND FINANCIAL ANALYSIS ...... 30 IBRD MAP 33777R ...... 38
This document has a restricted distribution and may be used by recipients only in the performance of their official duties . Its contents may not be otherwise disclosed without World Bank authorization.
BENIN SECOND DECENTRALIZED CITY MANAGEMENT PROJECT ADDITIONAL FINANCING
PROJECT PAPER DATA SHEET
Date: May 2 1,2008 Team Leader: Franck Bousquet Country: Benin Sector Manager: Eustache Ouayoro Project Name: Second Decentralized City Acting Country Director: Antonella Bassani Management Project Environmental Category: B Project ID: P109209 Borrower: Republic ofBenin Responsible agency: Agence d’exkcution des travaux urbains (AGETUR)
Revised estimated disbursements (Bank FY/US$m) FY 2009 2010 201 1 Annual 10.0 26.0 4.0 Cumulative 10.0 36.0 40.0 Current closing date: June 30,2010 Revised closing date: December 3 1,20 10 Does the restructured or scaled-up project require any exceptions from Bank policies? I No Have these been approved by Bank management? I N/A Is approval for any policy exception sought from the Board? No Revised project development objectives/outcomes: The project development objectives remain unchanged: To increase access to infrastructure and basic services for residents of Benin’s primary cities (Cotonou, Porto-Novo, and Parakou) and selected secondary cities (Abomey-Calavi, Lokossa, and Kandi). The Additional Financing will scale up the project impact in the primary cities in terms ofthe number ofpeople gaining access to roads and being protected from periodic flooding. Does the scaled-up or restructured project trigger any new safeguard policies? No For Additional Financing [ ] Loan [XI Credit [ ] Grant For Loans/Credits/Grants: Total Bank financing (USsm.): 40.0 Proposed terms: Standard IDA terms. 40 years maturity including a grace period of 10 years.
Financing Plan (US$m.) Source I Local I Foreign I Total Borrower 7.09 0.00 7.09 IDA 37.50 2.50 40.00 Others 0.00 0.00 0.00 Total 44.59 2.50 47.09
A. INTRODUCTION
1. This Project Paper seeks the approval of the Executive Directors to provide an Additional Credit in an amount ofUS$40 million to the Republic ofBenin for the Second Decentralized City Management Project (Cr. 4117 BEN). The proposed Additional Credit will finance costs associated with scaling up the development effectiveness and impact of the original project, as described in the Project Appraisal Document presented to the Board on September 12, 2005. The scaling up comprises construction and rehabilitation of 9.6 kilometers of roads and 10.8 kilometers of drainage works to hrther improve access to some of the poorest neighborhoods of the major cities of Benin and reduce periodic flooding in these neighborhoods. The proposed Additional Financing will also finance cost overruns (US$1 million), mainly related to the depreciation ofthe U.S. dollar.'
2. The Second Decentralized City Management Project is the second and final phase of a two-phased Adaptable Program Loan (APL). The first phase of the APL, the First Decentralized City Management Project (Cr. 3234 BEN), was implemented from 1999 to 2004 for an amount of SDR 18.9 million (US$25.5 million equivalent).2 Implementation of the second and final phase of the APL is rated satisfactory and no changes to the objectives or general design and implementation modalities of the original project are being proposed.
3. As was the case under the original Second Decentralized City Management Project, there is strong coordination between the proposed Additional Financing and a new operation under preparation for the urban agglomeration of Cotonou, financed by the French Development Agency (EUR 10-15 million, see Technical Annex for details).
B. BACKGROUND AND RATIONALE FOR ADDITIONAL FINANCING
4. Country context. Benin is a small, poor country with a population of 8.7 million and a per capita income of US$540 in 2006. Poverty remains widespread and per capita income is below the average for Sub-Saharan Africa. Since 1989, democracy has been greatly strengthened and the new Government, elected in 2006, has reaffirmed the importance of decentralization as a critical issue for development. There has been no significant change to the country and sector background since appraisal of the original project in June 2005. The urbanization rate stands at 41 percent but is rapidly increasing, with an annual urban population growth rate of 5 percent. Limited infrastructure and poor access to basic services affect living conditions in many neighborhoods and constrain the ability of Benin's cities to reap the benefits of economies of scale normally linked with increased urbanization.
5. The original Credit. The original Development Credit Agreement for an amount of SDR 24.0 million (US$35.0 million equivalent) was signed on November 3, 2005. The
1 This addresses the first and third situations described in the OPBP 13.20 on Additional Financing and the Guidance to Staff note on Processing Additional Financing dated May 2005 (updated April 2007). * The outcome of the First Decentralized City Management Project was rated Satisfactory and sustainability was rated Likely in the ICR and confiiedby OED (the precursor to IEG).
1 Credit became effective on March 8, 2006 and the closing date is June 30, 2010. Disbursement projections indicate that the total credit amount will be disbursed before the project closing date but works under Component B (roads and drainage; US$21.52 million), for which the Additional Financing is proposed, are expected to be completed at the end of2008. The original project is coordinated with a parallel financing by the French Development Agency in the amount ofEUR 9 million.
6. Project objectives. The original Project Development Objective (PDO) is to increase access to infrastructure and basic services for residents of Benin’s primary cities (Cotonou, Porto-Novo, and Parakou) and selected secondary cities (Abomey-Calavi, Lokossa, and Kandi).
7. Scope and design of the original project. The Second Decentralized City Management Project focuses on six major cities in Benin, building on the work that was carried out in three primary cities (Cotonou, Porto-Novo, and Parakou) under the First Decentralized City Management Project and extending the geographic coverage to three secondary cities (Abomey-Calavi, Lokossa, and Kandi). The original project contributes directly to the country’s objectives in the urban sector and to poverty reduction by: (i) facilitating the decentralization process; (ii)providing capacity building to local governments; (iii)supporting cities to generate increased revenues for financing and operating urban services; (iv) providing fbnding for infrastructure, most of which directly benefits the poorest neighborhoods; and (v) supporting mechanisms to increase local residents’ participation in the urban development process.
8. Components. The original project has four components:
A) Municipal Management Strengthening (US$5.33 million), designed to improve management tools and financial resources for service delivery and infrastructure maintenance in project cities. B) Rehabilitation and Reconstruction ofBasic Urban Infrastructure (US$21.52 million), using labor-intensive construction techniques to generate employment. C) Community Participation and Integration (US$2.46 million) to promote initiatives from and participation of communities living in low-income neighborhoods and enhance municipalities’ capacity for community outreach. D) Solid Waste Management in Porto-Novo (US$5.87 million).
9. Project performance. During two years ofimplementation, project performance has consistently been rated satisfactory with regard to objectives and implementation progress. The project is likely to achieve its development objectives. For Component A, the six project cities taken as a whole have exceeded the combined 2007 target of raising own revenue by 30 percent, with only one city falling below the target. However, performance in terms of expenditure on administrative costs and road and drainage maintenance has been below targets. The 2007 expenditure on road and drainage maintenance for the three primary cities (beneficiaries ofthe proposed Additional Financing) has been between 18 to 25 percent oftotal budgets instead of25 to 30 percent. Expenditure on administrative costs has been 2 to 6 percentage points above the target. This situation is largely due to the suspension, of the road tax in 2006, a major source of revenue for the three primary cities
2 (e.g. almost 20 percent of the total revenue for Porto-Novo), to promote regional integration. The road tax has now been reintroduced and the resulting revenues for the cities provide reassurance that this situation will be corrected. Additionally, the increase in the cities’ own revenues shall provide additional budget resources for activities, including infrastructure maintenance.
10. As of April 2008, the Second Decentralized City Management Project has funded the following under Component B: (i)rehabilitation (paving and drainage) of 10 kilometers ofurban roads, providing 80,000 residents better access to city centers, and (ii) construction of 3.2 kilometers of primary drainage network, protecting 30,000 residents from periodic flooding. Initial delays encountered in civil works were, due to external factors such as severe flooding in 20073 and shortage of cement in the country, as well as the slow mobilization of construction companies. However, corrective measures have been taken by the implementing agency to make up for this delay, and all works under Component B are expected to be completed by the end of2008. Consequently, the project is on track to meet the end-of-project targets of providing 230,000 people access to roads and protecting 38,000 people from periodic flooding, 18 months before the closing date of the original project. For Component CyNeighborhood Development Committees (NDCs) have been established in all 14 poor neighborhoods targeted by the project, and Community Initiative Support Units (CISUs) have been established in all six cities to carry out outreach activities. A newly established Solid Waste Management Unit is in place and operational in Porto-Novo under Component D. With a solid waste collection rate of 30 percent in Porto-Novo, the project is slightly below the target of 35 percent for 2007. However, this percentage is expected to increase when Component D is fully implemented. A decision will be taken regarding the financing of major works under Component D during the Mid-Term Review, as stipulated in the Development Credit Agreemente4
11. Compliance with fiduciary safeguards is satisfactory. During the appraisal mission for the Additional Financing, a re-assessment of procurement capacity and a financial management review of the implementing agency for Component B (AGETUR) were carried out by the Bank. The procurement re-assessment revealed that AGETUR has already demonstrated a highly satisfactory performance in the implementation of procurement activities for Component B ofthe original project and has qualified staff with good knowledge of Bank procurement procedures and guidelines. The financial management review was assessed as satisfactory. AGETUR is well staffed, familiar with World Bank financial management procedures and has sound accounting and financial management systems in place. Financial audit opinions have been unqualified for the duration of the original project. AGETUR is using report based disbursements and acceptable Interim Financial Reports (IFRs) have been submitted to .IDA without delays.
The major flooding, which occurred in May-June 2007, contributed to the Government requesting the proposed Additional Financing. The triggers for financing major works, stipulated in the Development Credit Agreement for the original project, pertain to the institutional arrangements for solid waste management and adoption of a reliable financing plan and solid waste management plan. These triggers are expected to be met by the Mid-Term Review ofthe original project and their review and decisions on financing major works are not dependent on whether the Additional Financing is granted.
3 12. The project is rated satisfactory in terms of social and environmental safeguard compliance. The performance of the implementing agencies for the original project is satisfactory. A technical audit ofworks implemented under Components B and D has been completed by independent consultants as well as by the Project Unit within the Ministry in charge of Urban Affairs. The audit found the technical quality ofworks to be satisfactory. This assessment was confirmed by a Bank supervision mission in November 2007.
13. The Government and cities are fully committed to the project and have complied with all covenants specified in the Development Credit Agreement. An initial delay in provision of counterpart funds slowed down implementation of the project just after effectiveness. However, this delay was directly related to the change of Government in 2006 and provision of counterpart funds has not resulted in delaying project implementation since November 2006. At the time of appraisal of the Additional Financing, 91 percent ofthe total expected counterpart funds ofCFAF 1.014 billion for the entire original project had been provided. A recent delay in providing counterpart funds is not related to the availability of hnds but to the ability of the central administration to quickly process withdrawal applications. For this reason, the replenishment level of the AGETUR Project Account has been revised (see Technical Annex for details).
14. Rationale and reasons for requesting the Additional Financing. The three primary cities have priority programs of works for which funding is lacking. These programs include the construction and rehabilitation of 260 kilometers of roads and 167 kilometers of drainage. The original project was not able to address the immense needs due to IDA constraints. Based on the satisfactory performance of the project and the scope of the needs, the Government requested an Additional Financing of CFAF 17 billion for the project on July 23, 2007, to scale up the impact of the on-going, well performing project and expand the scope of road rehabilitation and drainage works under Component B, in view of the positive impact of these works on quality of life of affected populations. Neighborhoods in the three major cities that will benefit from the Additional Financing suffer from periodic flooding in the rainy season that isolate them from the rest ofthe city, negatively impact the health of the population, and seriously hinder access to social services and economic activities; the latter being particularly detrimental to single, female headed households.
15. Substantial progress was made in the three primary cities during the first phase of the APL in terms of increasing financial resources and organizational and technical capacity to deliver urban services and implement operation and maintenance of infrastructure. This has been hrther strengthened under the second and final phase of the APL. Currently in Benin, the Government and cities are still unable to provide financial resources from their own budgets to cover the cost of construction of the much needed infrastructure. This is going to be the case for years to come because of limited budgets and their inability to borrow on market terms. Despite the inability to finance major capital investments, progress so far under the APL has been made in the areas of technical capacity and funding of operation and maintenance in the three primary cities and this will ensure adequate maintenance ofthe current works and the proposed additional program of works. Since the original project and interventions financed by other donors are appropriately addressing capacity needs, the Additional Financing will only finance works.
4 16. The three secondary cities (Abomey-Calavi, Lokossa, and Kandi) are benefiting from ongoing works under the original project and from assistance to improve urban management, raise revenues, and improve maintenance of infrastructure. While there are also infrastructure needs in these cities that are not being addressed under the original project, these cities should not have their resources stretched at this point by imposing additional recurrent maintenance expenditure. Therefore, the Government has requested that the proposed additional works be concentrated in the three primary cities where the capacity and resources will be available to ensure appropriate maintenance ofworks.
17. The European Union (EU) and the French Development Agency (AFD) are the main financiers of infrastructure investments in urban areas among donors in Benin. The AFD is currently preparing an urban development project (estimated at EUR 10-15 million), for the urban agglomeration of Cotonou (Cotonou, Sbmb-Podji, and Abomey- Calavi) with a focus on infrastructure in Abomey-Calavi, capacity strengthening, and inter- municipal cooperation. As with the original project, coordination between the proposed Additional Financing and the new AFD financed operation has been strong (see Technical Annex for details). In that respect, an Additional Financing from the World Bank presents an opportune way for the Bank to increase development impact within the framework of the current Bank portfolio and program, based on the existing Country Assistance Strategy (CAS).
18. Cost overrun. The Additional Financing will also provide US$1 million (Le. 2.5 percent of the proposed Additional Financing) to cover cost overruns, mainly to make up for the depreciation of the U.S. dollar, beyond what could have been anticipated at appraisal, and ensure that all activities included under the original project are completed as expected. Overall, the cost overruns in CFAF are estimated at 6.25 percent, which is below the 7 percent price and physical contingencies agreed in the Development Credit Agreement at appraisal and negotiation of the Credit (under the unallocated category). However, the U.S. dollar has depreciated by about 12 percent compared to appraisal estimates and the SDR has depreciated by 9 percent. The project has already disbursed 50 percent of the total amount and the credit was negotiated in SDR. A review of the cost overrun and updated economic analysis carried out at appraisal of the Additional Financing, shows that the original project continues to be fully economically justified (see paragraph 32 and Appendix D for details).
C. PROPOSED CHANGES
19. The development objective for the Additional Financing remains unchanged. The Additional Financing will complement the works already being carried out in Cotonou, Porto-Novo, and Parakou under Component B. The original project is financing 22 kilometers of road works and 4 kilometers of drainage works in the six cities and the proposed additional program includes an additional 9.6 kilometers of roads and 10.8 kilometers ofdrainage works in the three primary cities.
20. The proposed additional activities are expected to be completed by December 3 1, 2010, six months after the closing date of the original project. As the ongoing road and drainage works in the three primary cities are close to completion, there is capacity in the
5 implementing agency to assure timely delivery of the proposed additional program. Preparatory studies for the additional program have been financed under the original project and the bidding process can be launched immediately after effectiveness.
2 1. The costs and financing plan for the Additional Financing are presented in the table below, as confirmed at appraisal. The total cost is estimated at US$47.09 million, ofwhich an IDA financing of US$40 million equivalent is proposed. The government and beneficiary city contribution will be 10 percent and 5 percent respectively for works; with consultant services financed 100 percent by the Credit.
Component IDA GOB Cities Total A. Municipal Management Strengthening 5.26 0.07 0.0 5.33 B. Rehabilitation and Reconstruction ofBasic UrbanInfrastructure 19.62 0.95 0.95 21.52 C. Communitv Particination and Intemation 2.33 0.08 0.05 2.46 I D. Solid Waste Management in Porto-Novo I 5.55 I 0.16 I 0.16 I 5.87 I I Price and physical contingencies I 2.28 I 0.08 I 0.08 I 2.44 I Total costs I 35.0 I 1.3 I 1.2 I 37.6
Table 2: Additional Finance, Component B - Cost by item and financier (amounts in US$ million, including tax for counterpart funds) IDA GOB Cities Total Works 31.07 4.31 2.16 37.54 - Drainage works 21.22 2.95 1.47 25.63 - Road works 8.52 1.18 0.59 10.29 - EIA and RAP I 1.34 I 0.19 I 0.09 1 1.62 I Consultant services (Including delegated contract management) 4.38 0.00 0.00 4.38 Operating costs (Project Unit) 0.12 0.00 0.00 0.12 Contingencies 3.42 0.41 0.21 4.04 Cost overrun original project 1.00 0.00 0.00 1.00 Total costs 40.00 4.73 2.36 47.09
D. CONSISTENCY WITH CAS AND PRS
22. The Stratkgie de croissance pour la rkduction de la pauvretk (2007-2009) is Benin’s second generation Poverty Reduction Strategy (PRS). The draft CAS for Benin (draft dated January 29,2008) focuses on the five pillars ofthe PRS aimed at:
Pillar 1 - Accelerating growth. 0 Pillar 2 - Using infrastructure development as a tool for growth. 0 Pillar 3 - Developing human capital. 0 Pillar 4 - Improving governance. Pillar 5 - Promoting balanced and sustainable development.
23. The original project supports Pillars 1 through 4, with a special focus on Pillar 2. Implementation of additional road and drainage works to improve the lives of urban
6 inhabitants and provide an environment conducive for poverty reduction and development of economic activities will focus on Pillars 1 and 2 of the PRS. The Additional Financing is included under Pillar 2 of the draft CAS and will further contribute towards reaching target 11 of the MDGs, which is to achieve a significant improvement in the lives of at least 100 million slum dwellers.
24. There are significant cost-effectiveness gains in implementing the scaled up activities as part of the ongoing operation, building on implementation arrangements already in place, and the scale-up can feasibly be accommodated in the context of the original project.
E. APPRAISAL OF RESTRUCTURED OR SCALED-UP PROJECT ACTIVITIES
25. Appraisal of scaled-up activities. A thorough review of implementation progress has been carried out, including updated cost analysis to ensure that the original project and the proposed Additional Financing is coherent and sustainable in the light of operations financed by other donors. The task team for the Additional Financing includes the fiduciary, environmental, and social safeguards specialists from the original project. As detailed in the Technical Annex, the works complement activities under the original project and activities financed by other donors.
26. Appraisal of the Additional Financing was scheduled to take place concurrently with the Mid-Term Review ofthe original project. However, the Mid-Term Review had to be postponed from the originally planned date of April 1-15 to ensure an adequate consultation process in relation to the implementation of the solid waste management component (Component D) in Porto-Novo, which is not part of the Additional Financing. To avoid changes to the IDA allocation and comply with the Borrower’s requirement of starting implementation of the Additional Financing in 2008, it was decided to be pro- active and not postpone processing the Additional Financing.
27. The Additional Financing will be implemented using the same institutional, procurement’ and disbursement arrangements as for the original project, as they have been assessed to be strong by the Bank’s fiduciary teams. Following the Government’s request to keep the same institutional arrangements under the proposed Additional Financing and the satisfactory performance of the implementing agency in charge of Component B (AGETUR), this agency will continue to be responsible for activities under the Additional Financing since the nature ofthe proposed activities are not different (see Technical Annex for details).
28. Lack of access to basic services reduces the coping capacity of households in the short-term and tends to perpetuate poverty over the longer term. The selection of works included in the additional program is based on an analysis of needs and impact (see Technical Annex for details). The original project is addressing poverty and social issues through Components A and C. In the original project (as well as in the first phase of the APL), women play an important role in managing water kiosks. The project’s participatory
’Taking into account the revised procurement guidelines of October 2006.
7 design involves women in key decision-making processes and the Community Initiative Support Units and NGOs are responsible for providing technical assistance to ensure that social issues are adequately reflected in the project consultative process (see further details in the Technical Annex).
29. The entire road program of road works under the proposed Additional Financing has been subjected to an economic analysis, which shows that the entire road works program yields an Economic Rate of Return (ERR) of 50 percent (above the minimum required 12 percent for Bank-financed projects) and a Net Present Value of US$15.18 Million (at a 12 percent discount rate). The Additional Financing therefore consolidates the economic justification of the original project. Investment costs were also reviewed and compared to the actual costs under the original project. The analysis shows that the road investment cost per kilometer under the Additional Financing is 8 percent higher than under the original project, which is explained by an increase in construction material cost (especially cement for which a shortage has been observed in the sub-region, thus significantly impacting its price) and a change in design (double lane under the Additional Financing versus single lane under the original project, corresponding to a higher traffic under the proposed project). The drainage works have been subjected to a multi-criteria analysis incorporating the non-quantifiable benefits ofthe works, showing that all drainage works are justified based on their high expected impact. The details of the economic and multi-criteria analyses are presented in Appendix D.
30. The recurrent maintenance cost incurred by the proposed program of works has been evaluated by a project preparatoiy study to be 0.4 percent ofthe three primary cities’ total budgets. Extrapolating this result on all ongoing road and drainage works in the three cities (including the works program of the proposed Additional Financing), it is estimated that all these works will entail an extra recurrent expenditure on maintenance of 1.5 percent of the cities’ total budget. This is a figure that the cities can feasibly finance, especially given the progress and support provided under Component A of the original project.
31. The proposed activities are similar in type and scope to the original investment program so the project will remain in safeguards Category B and no new safeguard policies are triggered. The types of investments included in the Additional Financing are covered by the Environmental and Social Management Framework (ESMF) and Resettlement Policy Framework (RPF) prepared and disclosed on May 20, 2005, prior to appraisal of the original project. For the Additional Financing, because the project has detailed information on the investment types, sub-project characteristics and their locations, the Borrower has prepared specific sub-project Environmental Impact Assessments/Environmental Management Plans and Resettlement Action Plans. These have been reviewed along with the feasibility studies of the proposed civil works, approved and disclosed in-country and at the World Bank InfoShop on April 18, 2008, prior to appraisal ofthe Additional Financing.
32. Appraisal offznancing gap. The cost overrun of US$1 million does not jeopardize the economic justification of the original Credit. The economic analysis carried out at appraisal ofthe original program ofroad works under Component B yielded an ERR of24
8 percent. This economic analysis has been repeated using the same assumptions but with updated costs. This updated analysis yields a minimum ERR of 20 percent for road works included in the original project, above the required 12 percent for Bank financed projects, showing that the original project continues to be economically justified (for details, see Appendix D).
F. EXPECTED OUTCOMES
33. The Additional Financing will benefit a further 106,000 persons who will gain access to roads (9.6 kilometers of roads are planned) and 76,000 persons who will no longer be subjected to periodic flooding in their place of residence (10.8 kilometers of drainage are planned). This compares to 230,000 persons benefiting from 22 kilometers of roads and 38,000 persons benefiting from 4 kilometers of drainage under the original project. The major problem the Additional Financing has been designed to tackle is the recurrent flooding and the works program has been conceived to ensure complementarity between road and drainage works.
Table 3: Comparison of expected impact for original project and Additional Finance, Component B Original Additional Type of work Details project Financing I Number ofbeneficiaries I 230.000 I 106,000 I Roads Length (lulometers) 22 9.6 Number of beneficiaries per kilometer IO, 455 11,042 Number of beneficiaries 3 8.000 76.000 Drainage I Length (lulometers) I 41 10.8 I I Number of beneficiaries per kilometer I 9,500" I 7,037" I Note. a. The Number of beneficiaries per km under the original project and the Additional Financing are similar, the only differences coming from the density of areas where the drainage and road works are being carried out.
G. BENEFITS AND RISKS
34. Benefits. As described above, the proposed activities will further improve living conditions and infrastructure conditions in poor neighborhoods of the three primary cities. The project activities are aligned with activities financed by the Government and other donors involved in the urban sector in Benin and will strongly reinforce the Government's efforts to implement poverty reduction programs and strengthen the role ofcities as centers ofdevelopment and economic growth.
35. The collectors are expected to alleviate problems associated with flooding of the concerned neighborhoods during the rainy season, which lasts several months. They are designed to drain the immediate catchment area they transverse, and thus improve the living conditions and reduce the negative effects ofmalaria on the affected population. The works will further result in a strong increase in land value in the affected areas, which will in turn have a positive impact on the local governments' ability to raise fiscal revenues. This is not expected to affect the land ownership situation.
9 36. For the Additional Financing, the generation oftemporary employment through the use of labor-intensive construction techniques will be monitored by AGETUR, as it has been on an ongoing basis under the original project. Based on estimates by the project implementing agency, the use of manual labor accounts for about 10 percent of the total cost of works. Implementation of the proposed additional works using intensive construction techniques is expected to generate about 467,800 person-days of employment (see Technical Annex for additional details).
37. Risks. The overall risk associated with the Additional Financing is rated modest, the same rating as the original project. Risks include: (i)lack of counterpart funds and (ii)lack offunds for infrastructure maintenance.
Lack of counterpart funds. In the past, mobilization of Government counterpart funds was an issue in Benin. Despite the fact that provision was made in the budget, it was difficult to mobilize the funds on time due to Treasury problems. However, the present Government has, during the last two years, demonstrated its capacity to respect its commitments by releasing budgeted allocation and funds are presently available to be mobilized. At the time of appraisal of the Additional Financing, all anticipated Government counterpart funds had been paid. A minor problem remains in terms of timely processing of withdrawal applications. Following meetings held with the Ministers of Finance and Plan during the appraisal mission of the proposed Additional Financing, it has been agreed to increase the replenishment level of the AGETUR Project Account from CFAF 250 million to CFAF 500 million, and thus decrease the number ofwithdrawal requests necessary, in order to mitigate this risk. The risk related to the lack of counterpart funds is therefore rated modest for the project (see Technical Annex for details).
0 Lack of hnds for infrastructure maintenance. The cities of Cotonou, Porto-Novo, and Parakou have been slightly underperforming in terms of expenditure on road and drainage maintenance. However, as explained (see paragraph 9, above), this situation is expected to improve along with the overall budget situation. This risk is rated modest, as confirmed at appraisal.
H. FINANCIAL. TERMS AND CONDITIONS
38. The Additional Financing ofUS$40 million equivalent will be provided as a Credit on standard IDA terms. At negotiations, the annual work program annexed to the Project Agreement with AGETUR was updated in a manner satisfactory to the Association. The conditions for effectiveness are:
(i) The Subsidiary Agreement has been executed on behalf of the Recipient and AGETUR. (ii) The Recipient and AGETUR have adapted the Project Implementation Manual and Project Administrative, Financial and Accounting Manual of the original project in a manner satisfactory to the Association.
10 (iii) New Conventions de maitrise d'ouvrage dklkguk in form and substance satisfactory to the Association have been executed between AGETUR and each of the primary cities. (iv) The Government has deposited the initial counterpart fund of CFAF 500 million in the AGETUR Project Account to finance its contribution to the project.
11 BENIN SECOND DECENTRALIZED CITY MANAGEMENT PROJECT ADDITIONAL FINANCING
TECHNICAL ANNEX
Detailed description of the Additional Financing
Selection of works
1. The program of works included under the proposed Additional Financing was selected from the three primary cities’ existing priority programs of works, for which funding is lacking. These programs include the construction and rehabilitation of 260 kilometers of roads and 167 kilometers of drainage. The works program in the original request from the Government was refined through a consultant study that analyzed coherence with the various development plans in effect, ongoing works (both the original project and other ongoing and planned works), and the impact on intended beneficiaries (including vulnerable groups). The study also examined the recurrent maintenance costs incurred by the works included in the proposed Additional Financing and verified that these costs were reasonable compared to the available resources of the affected cities. Based on this study and consultations with the client (including the technical services ofall three cities), the initially proposed program of works was adjusted to maximize complementarities between ongoing and planned works and impact on reducing flooding in poor neighborhoods. The program of works was pre-appraised by the task team transport specialist in November 2007, hrther discussed during a Bank mission in January 2008 with strong involvement of all cities (including visits to all six cities of the original project) and finalized during the appraisal mission ofApril 2008.
2. The neighborhoods benefiting from the additional works are among the poorest and most deprived in the targeted cities. A large part of the proposed additional program of works benefits the residents ofneighborhoods targeted under Component C of the original project. This is the case for the works on Collector “Wy and complimentary road works in Cotonou (see overview ofworks below) and the works on Collectors “B” and “C” and the related road works in Parakou. The neighborhoods benefiting from these works were originally selected as beneficiaries of Component C of the original project based on relative needs, level ofpoverty (measured as lack of access to basic services), and level of community organization (to ensure stakeholder ownership and sustainability of the infrastructure financed under the project). These neighborhoods and the neighborhood infrastructure constructed under Component C will remain largely inaccessible during the rainy season without the additional drainage works.
3. The remaining works also target some of the poorest and most inaccessible neighborhoods in the project cities. The works on Collector “I” in Porto-Novo will assure drainage of an area, which suffers from stagnant water during six months ofthe year due to its placement in a depression. Construction of Collector “G” in Porto-Novo will assure drainage of a neighborhood that is particularly intensely affected by recurrent flooding,-and
12 which was a contributory factor to the Government requesting the Additional Financing. Finally, works on Collector "P" will assure drainage of a densely populated neighborhood in Cotonou.
4. Description. The activities will include: (i)rehabilitation (paving and drainage) of the road network; (ii)construction and rehabilitation of a primary drainage network in some neighborhoods not already served in the beneficiary cities; (iii)technical studies and supervision needed for implementation of these works; (iv) periodic technical audits of works and contract management procedures as well as financial audits; (v) socio- environmental studies; (vi) implementation agency management fees; and (vii) additional operating costs for the Project Unit within the Ministry in charge ofurban affairs.
Table TA1: Cost by City (amounts in CFAF million, without tax) Length Estimated City Works (meters) cost I Collector "P" to the Fifadii dike I 800 I 3,729.60 Downstream part ofCollector "W" 3,756 4,537.29 Rue No2250 along collector "P" connecting Etoile- 1,600 1,149.18 Cotonou Akossombo with Avenue du Renouveau Rue SBnadC I Avotrou I Tanto 3,610 2,264.57 I Total collectors Cotonou I 4.556 I 8.266.89 1 Total roads Cotonou 5,210 3,413.75 Total Cotonou I I,680.64 I UD-and downstream Dart of Collector "G" 3.005 2.460.37 Add-on to Collector "I" 95 1 682.98 Porto-Novo Rue Rails Dodji I Route d'Adjarra 1,500 861.30 Total collectors Porto-Novo 3,956 3,143.35 I Total roads Porto-Novo I 1,500 I 861.30 I Total Porto-Novo I I 4004,66 I Downstream add-on to Collector "C" 1,605 1,092.07 Comulementaw works in the "B" Basin 773 297.20 Road along Collector "C" (resurfacing) 1,605 301.86 Parakou Roads along Collector "B" 1,348 561.77 Total collectors Parakou 2,378 1,389.28 Total roads Parakou 2,953 863.64 Total Parakou 2 252,9I Total collectors 10,890 12,799.52 Total roads 9,663 5,138.69 Su b-total 17,938.21 Technical and financial audits 70.00 Other costs Delegated contract management 3.50 I ~~ ~ ___ ~~ ~ Total other costs 73.50 Overall Total 18,011.71
13 5. Beneficiary cities have committed to financing recurrent costs for these investments as well as for the existing infrastructure. Cities’ counterpart contribution level is kept at 5 percent of the total investment cost, as for the original project, based on track record and ability to pay.
Implementation arrangements
6. Similar to Phases I and I1 of the APL, the Project will be focusing on the municipalities as the principal beneficiaries ofcapacity building activities and as managers of works to be completed under the project. The implementation arrangements under the proposed Additional Financing are identical to the arrangements for the original project.
7. At the national level, the project will remain supervised and coordinated by the Steering Committee (COSUCO) headed by the Ministry in charge of Urban Affairs. COSUCO will provide overall guidance and review project implementation progress. Similar to the original project, this Committee will have regular meetings chaired by the Minister in charge ofUrban Affairs, with representatives of other Ministries with areas of responsibility affected by the project, and representatives of the cities participating in the project. COSUCO’s role is to take overall decisions on project implementation, meet quarterly to review activity reports of the implementing agencies and Local Steering Committees (LSCs), discuss and act on recommendations arising fi-om project implementation, oversee implementation ofconventions between the implementing agency and each ofthe cities, and approve annual works programs.
8. As for the original project, the Project Unit within the Ministry in charge ofUrban Affairs will continue to follow up on and evaluate work by the implementing agency, act as the technical secretariat of COSUCO, prepare consolidated technical and financial project reports for the Bank, and ensure dissemination of learning fi-om the project to the Ministry in charge ofUrban Affairs.
9. Similar to the original project, the Government will delegate contract management to AGETUR, as specified in the Subsidiary Agreement between the Government and the agency and conventions between the participating cities and the agency. AGETUR will manage studies and works on behalf of the beneficiary cities according to the terms specified in an annex to the new convention signed by the parties. Annual programming and conditions for implementation of works will be specified in an annex to the delegated contract management contracts signed between AGETUR and each city. AGETUR will implement the programs according to the Project Implementation Manual in effect for the original project, adapted as needed for the Additional Financing.
IO. At the local level, Local Steering Committees, presided over by the cities’ General Secretaries and comprising line representatives of the Ministries in charge of Decentralization, Planning, Urban Affairs, Finance, and Economy, and representatives of local associations and Neighborhood Development Committees (NDCs) were established in all six project cities under the original project. These committees have proven to be very successful. As a result, under the proposed Additional Financing, the LSCs will continue to oversee project implementation at the local level.
14 Project implementation period
11. The closing date for the original credit is June 30, 2010. An extension of the closing date of the original project to December 31, 2010 has been agreed with the Government in order to coincide with the closing date of the Additional Financing and implement the proposed additional activities.
Capacity of the borrower to implement the project
12. The implementing agency for Component B (AGETUR) has performed satisfactorily under the original project and will carry out and oversee execution of the additional activities. The proposed Additional Financing does not require any additional implementation capacity beyond what is already in place, and its implementation will be subject to the same monitoring and reporting requirements as the original project.
Fiduciary arrangements
Financial management
13. The inherent risk of the public financial management system in Benin is rated Substantial at the country level. The Government’s policy framework for Budget Management (GBAR) is based on the 2005 CFAA6 (Country Financial Accountability Assessment) and the recent PEFA’ (Public Expenditure and Financial Accountability) assessment.
14. It is noted that significant progress has been made in improving public expenditure management, while risks remain in the following areas: (i)Poor accounting recording and reporting system. Public accounts are generally incomplete and delayed; (ii)Control mechanism. Ex-post controls are uncoordinated and include several units working independently, external audits are delayed; and (iii)Surge in the use of expenses following exceptional procedures.
15. Since May 2006, the Government has taken strong measures to address these issues. A decree regulating internal audit has been adopted and the use of exceptional procedures has been strictly limited. The issue regarding delay in production ofaccounts is being resolved with the future recruitment of additional staff and the deployment of accounting software to the sub-national level. Concerning external audits, discussions are in progress with the Government to improve the working environment of the Chamber of Account. The inherent risk is rated Moderate and Low at project level. Therefore the overall inherent risk is rated Moderate.
16. The overall control risk for the project is rated Low. The current implementing agency for Component B (AGETUR) has performed satisfactorily under the original
It is an updated version of the 2001 CFAA. Completed November 2007.
15 project and will carry out and oversee execution of the additional activities. During the appraisal mission for the Additional Financing, financial management review was carried out by the Bank and assessed as satisfactory. AGETUR is well staffed, familiar with World Bank financial management procedures and has sound accounting and financial management systems in place. Financial audit opinions have been unqualified for the duration of the original project. AGETUR is using report based disbursements and acceptable Interim Financial Reports (IFRs) have been submitted to IDA without delay. There are no FM conditions for negotiation, Board presentation or effectiveness, except to have counterpart funds released by the Government (see below).
17. Counterpart funds. In the past, mobilization of Government counterpart funds was an issue in Benin. Despite the fact that provision was made in the budget, it was difficult to mobilize the funds on time due to Treasury problems. The original project faced the same situation at the beginning of its implementation, but the situation has now significantly improved and funds are available to be mobilized. Especially for infrastructure projects or areas which provide high visibility for the outcome, the Government has, during the last two years, demonstrated its capacity to fully respect its commitments by releasing budgeted allocation. The appraisal mission confirmed that the Government has paid all of its anticipated counterpart funds for the original project. In order to scale up the project, the Government requested to increase the level of its counterpart funds from 5 percent ofthe cost ofworks (the level for the original project) to 10 percent, which is compatible with the overall budget situation. A minor problem remains in terms oftimely processing ofwithdrawal applications. Following meetings held with the Ministers of Finance and Plan during the appraisal mission of the proposed Additional Financing, it has been agreed to increase the replenishment level of the AGETUR Project Account from CFAF 250 million to CFAF 500 million and thus reduce the number ofwithdrawal applications.
18. During the first two years ofproject implementation, some cities have occasionally been delaying their counterpart funds but this has not impacted progress of works and counterpart funds have so far always been provided. At the time of appraisal of the Additional Financing, 91 percent of the total expected counterpart funds of CFAF 1.014 billion for the entire original project had been provided. The financial management risk is rated modest for the project.
Procurement
19. All procurement activities for the Additional Financing will be carried out by AGETUR. An initial assessment of the capacity of AGETUR to implement procurement actions was carried out by the procurement specialist during the appraisal mission of the original project on May 30, 2005, in accordance with the Procurement Services Policy Group (OPCSPR) guidelines dated August 11, 1998. During the Bank supervision mission of July 2007, a post procurement review was carried out by the Bank and assessed as satisfactory. The post procurement review concluded that: (i)the implementing agency was performing highly in relation to procurement; (ii)the procurement plan was being
16 respected; (iii)procurement archives were well kept; and (iv) the payment ofcontracts had been done on time.
20. A re-assessment of procurement capacity of the executing entity was done by the Bank procurement specialist during appraisal of the Additional Financing to ensure appropriateness of existing procurement capacity. The re-assessment reviewed the organizational structure for implementing the activities of the Additional Financing, institutional arrangements, and the capacity ofthe agency staff assigned to the project. The assessment revealed that AGETUR has already demonstrated a highly satisfactory performance in the implementation of procurement activities of the Bank financed infrastructure component of the original project and has qualified staff with good knowledge ofBank procurement procedures and guidelines.
21. Under the on-going Project, the following actions have been taken: (i)two staff have received procurement training on World Bank procurement procedures in specialized institutions in Senegal; (ii)adoption of IDA’SStandard Bidding Documents for NCB; and (iii)integration of the procurement system with the computerized project financial management system.
22. In order to continuously update the skills in procurement and disbursement for the key operational staff of the agency, it has been agreed that the project finances training (procurement and disbursement) to firther enhance the capacities of the concerned staff. AGETUR’s capacities are recognized by other donors as the agency is also implementing a project funded by the European Development Fund and another project funded by the French Development Agency (AFD). The overall project risk from procurement is rated low.
23. As proposed by the Government, AGETUR will be selected exceptionally on a Single Source Selection (SSS) basis, and a contract, using the standard format ofdelegated contract management, will be signed between the State and AGETUR.
24. Justification of the SSS of AGETUR. The SSS of AGETUR is based on the following points:
(a) AGETUR has already demonstrated satisfactory performance in the implementation of procurement activities for the Bank-financed First and Second Decentralized City Management Projects, as confirmed by the result of the post procurement review carried out in July 2007; (b) The fact that a competitive process, at this stage and in this case, would not lead to better results as the tasks represent a natural continuation ofprevious work carried out by AGETUR; (c) AGETUR has qualified staff with good knowledge of Bank procurement procedures; and (d) AGETUR has adopted Bank procurement procedures and standard bidding documents updated on May 2004.
17 Procurement Plan
25. Procurement of goods and works will be carried out in accordance with the Bank’s Guidelines for procurement under IBRD Loans and IDA Credits dated May 2004, revised October 1 2006 and the provision stipulated in the Legal Agreement. At appraisal, the Borrower, through the implementing agency, developed a procurement plan for the entire period ofproject implementation (two years), which provides the basis for the procurement methods. This plan was formally agreed upon between the Borrower and IDA during negotiations. It will be made available in the project’s database and in the Bank’s external website upon approval of the project by the Bank’s Board. The procurement plan will be updated annually or as required by AGETUR in agreement with IDA to reflect the actual project implementation needs. All procurement activities will be carried out in accordance with the original or updated plans, as applicable.
Social aspects
26. Involvement of Community Initiative Support Units. The Additional Financing is expected to deliver significant social benefits by improving the living and environmental conditions of low-income communities in urban and peri-urban areas in the form of easier access to services and economic opportunities, reduced flooding, improved health (reducing exposure to mosquitoes, thereby reducing malaria impact on population), and generally a more pleasant living space. Public consultations with a number of key stakeholders (representatives of relevant ministries, solid waste management services (Direction de l’hygikne et de l’assainissement de base), environmental assessment services (Benin National Agency for the Environment (ABE)), municipalities, NGOs) showed that the benefits of the project are highly appreciated because the planned infrastructure investments will contribute to an improved quality of life of the affected population. All infrastructures have been chosen in consultation with the beneficiaries and the municipalities. The project will, in cooperation with the municipalities: (i)compensate affected persons appropriately if needed; (ii)provide environmental training at the local level; (iii)develop a reevaluation mechanism for the municipal contracts in case personnel at the municipalities change; (iv) strengthen partnerships for urban environmental management with the strong support of ABE; and (v) ensure that local populations participate in the project.
27. The Community Initiative Support Units (CISUs) established in all project cities have been actively involved in the implementation of Resettlement Action Plans for the original project. The CISUs have hrther assured a number of activities for the populations of the poor neighborhoods, including awareness-raising activities on hygiene and sanitation, administration of Neighborhood Development Committees, development of vegetable gardening (linked to a project under the Ministry ofAgriculture), and support to women for access to micro-credit.
28. Activities related to HIV/AIDS. The original project has financed, under Component A, a study on mapping of and a communication plan for HN/AIDS activities in Cotonou, Porto-Novo, and Parakou. These activities are being carried out under the supervision of the National Program to Fight AIDS and in coordination with the World
18 Bank-financed Second Multi-sectoral HN/AIDS Control Project. Results from this study are available and an action plan has been drawn up to implement the findings ofthe study under the original project, also assuring maximization of impact on Component B.
29. Monitoring of social impact. A socio-economic study is under way for the original project and will be available by the Mid-Term Review (a baseline was set up at the beginning of project implementation). The findings of this study will be used to monitor implementation of the proposed additional activities.
30. To strengthen monitoring of the social impact of the project, the Additional Financing will continue to include monitoring of the generation of employment through the use of labor-intensive construction techniques. These figures are already available for the original project and employment generation will continue to be used to benchmark performance on employment generation as compared to other projects using labor- intensive construction techniques. Based on estimates by the project implementing agency, use of manual labor accounts for about 10 percent of the total cost of works so far under the original project; implementation of the proposed additional works using intensive construction techniques is expected to generate about 467,800 person-days ofemployment. Monitoring this indicator for the Additional Financing will strengthen the focus on social issues without losing sight ofthe project development objective.
3 1. As for the original project and to generate employment and promote participation of local small and medium-size contractors, AGETUR will divide the infrastructure constructionhehabilitation program for roads into appropriately sized contract packages, incorporating designs for labor-intensive construction techniques.
Complementarity with other donor-financed interventions
Synergies with the Bank portfolio
32. Concerning the Bank portfolio, synergies are being sought with the Second Multi- sectoral HIV/AIDS Control Project, which could carry out HIV/AIDS awareness-raising recommended by the study to map HIV/AIDS activities financed under the original project and for which an action plan has been drawn up.
Coordination with AFD
33. The original project is strongly coordinated with an urban development project financed by the AFD (Programme d 'appui Ci I 'agglom&ation de Cotonou - PAACO; EUR 9 million). Coordination with the AFD under the original project also included strong coordination of intervention at the neighborhood level in terms of local infrastructure and micro-projects under Component C of the original project and the AFD-financed PAACO. A follow-on project is being prepared (PAACO 11; EUR 10-15 million), which will focus on the three communes ofthe urban agglomeration of Cotonou (Cotonou, Abomey-Calavi, and SCmC-Podji). Of these cities, Cotonou was included in the First Decentralized City Management Project; both Cotonou and Abomey-Calavi are included in the original
19 Second Decentralized City Management Project; and Cotonou is included in the proposed Additional Financing.
34. The PAACO I1 will further finance improvements to the urban land registers, financial management of the cities, and the technical services. These interventions are complementary to the original project. A particular trait ofthe PAACO I1 is the support to inter-communal cooperation between the three cities, which will strengthen the overall planning of development of the Cotonou urban agglomeration. This will be exemplified through support to either solid waste management or public transport,‘both themes that are not directly included in the original project or the proposed Additional Financing (solid waste management is included in the original project, but for Porto-Novo).
35. The details of the AFD-financed operation are still being fleshed out; the project is scheduled for approval towards the end of2008 or the start of2009. Preparatory studies for both the original Second Decentralized City Management Project and the proposed Additional Financing have been shared and discussed with the AFD, assuring complementarity ofinfrastructure investments’.
Coordination with other ongoing and planned operations
36. Investments financed by other donors are mainly concentrated in Cotonou. The EU is financing drainage works in the Western part of Cotonou (Basin “XX”) while the African Development Bank, the KfW, and the ECOWAS Bank for Investment and Development are financing road rehabilitation.
37. For Porto-Novo, the EU is financing minor road and drainage works and for Parakou, IDA and the EU are the only donors currently financing road and drainage works, although some inter-urban road works are being financed for both Porto-Novo and Parakou. All the above-mentioned works have been taken into account in project preparatory studies; the works included in the proposed Additional Financing complement these works.
’Under the original project and the proposed additional financing, key IDA funded preparatory studies were shared with AFD to allow ensure full complementarity of operations.
20 APPENDIX A: PROJECT PREPARATION AND TIMETABLE OF KEY EVENTS
Event I Date I Project identification I November 17,2007 I OPCS clearance ofConcept Note I December 20,2007 I CD authorization to complete processing 1 April 4,2008 I Appraisal April 19,2008 Negotiations April 24,2008 RVP approval May 29,2008 Board presentation I June 26,2008 I Date ofplanned effectiveness I September 26,2008 I Project closing I December 3 1, 20 10 1
Bank staff and consultants who worked on the project include:
Name I Title I Affiliation Franck Bousquet Sr. Financial Specialist and Task Team Leader AFTU2 Alexandre K. Dossou Sr. Infrastructure Specialist AFTTR I Hugues Agossou I Sr. Financial Management Specialist I AFTFM Aissata Z. Zerbo Procurement Analyst AFTU2 Christian Eghoff Urban Development Specialist Consultant Nathalie S. Munzberg Sr. Counsel LEGAF
~~ I Itchi Gnon Ayindo I Procurement Specialist I AFTPC I Renee M. Desclaux I Sr. Finance Officer I AFTRL I Sophie Hans-Moevi I Language Program Assistant I AFTU2 Abdoul-Wahab Seyni Social Development Specialist AFTCS Amadou KonarC Sr. Environmental Specialist AFTEN
21 APPENDIX B: MONITORING INDICATORS
As under the original Project, the implementing agency remains responsible for monitoring the result indicators and conducting surveys. The table below reproduces all the indicators for the original project. The target values for indicators are shown in the following table on Arrangements for Results Monitoring. Only indicators related to Component B of the original project are of direct concern to the proposed Additional Financing and have been revised as appropriate. All indicators for the original project have been included for completeness.
Growth in municipalities' own revenues. To assess the municipalities' frastructure and basic (ability to raise local revenues. I rvices for residents of Additional population getting access to To assess increased access to primary and secondary paved roads. urban infrastructure...... "...... D /Additional population protected from To assess impact ofworks on periodic flooding. improved urban services......
Development...... Committees. neighborhoods. Quantity ofmunicipal waste collected in To assess the effectiveness of the Porto-Novo and tranmorted out ofthe Citv. Porto-Novo SWMDroiect. 12 Intermediate Results Results Indicators for Each Component Use of Results Monitoring One per Component lcomponent...... Ô One: [Component One: lcomponent One: I Improved management IBilled tax collection rate. To monitor municipalities' tools and financial progress in generating revenues...... resources enabling Share ofmunicipalities' recurrent costs To assess the municipalities' municipalities to better budgets allocated and spent on ability to use resources for basic provide urban services infrastructure and basic urban services, i.e. urban services. and maintain all recurrent costs by administrative implemented operating expenses (as % oftotal infrastructure, with expenditure). support ofrelevant line Share ofmunicipalities' recurrent costs To assess the ability ofthe ministries and budgets allocated and spent on routine road municipalities to maintain deconcentrated maintenance (as % oftotal expenditure). infrastructure. administration. Technical and administrative management To assess the ability ofthe procedures manual developed and in use in primary cities to administer their the three primary cities. mandate effectively...... ~ ...... "...... "...... Periodic budget reports generated by To assess the capacity ofthe municipalities. municipalities to carry out budget
22 I lmanagement.
Benin's cities, agreeable to IDA, defined practices. and adopted by MEPN.' Component Two: Component Two: Comuonent Two: Improved access to Km ofrehabilitated urban roads. To assess actual implementation urban infrastructure. ofroad rehabilitation works...... Km of drainage built. To assess actual implementation ofdrainage works.
...... Component Three: Component Three: " ...... Component Three: "...... Improved access to basic Number ofmicro-projects (sub-component To assess if the participating services for residents of 3b) implemented and functional. neighborhoods are receiving poor neighborhoods. improved services at the local level...... Number ofcities disposing ofan To assess the quality of support operational Community Initiative Support from municipalities to the low- Unit . income neighborhoods. IComponent Four: IComponent Four: ]Component Four: Improved solid waste Study on solid waste management in Porto- To assess sustainability of management in Porto- Novo carried out. Solid waste management SWMP in Porto-Novo. Novo. plan and financing plan, agreeable to IDA, cal and central authorities...... Solid Waste Management Unit in place and To assess actual capacity to operational in the municipality ofPorto- implement SWMP. Novo.
Ministry of Environment and Nature Protection (Minisdre de I'environnement et de la protection de la nature).
23 Arrangements for results monitoring
I__ Outcome Indicators
Growth in municipalities’ own revenues with (millions oj report to baseline 2004 (%). CFAF: -____---____--______.______..___ -Cotonou (2003-2004: 11%) 903 47% 40% Not revised -Po~~o-Novo(2003-2004: 13%) 168 111% 40% Not revised -Parakou (2003-2004: 13%) 176 -4% 40% Not revised -Abomey-Calavi (Average 200 1-2004: 47%) 205 27% 20% Not revised -Lokossa (Average 2001-2004: 53%) 55 269% 20% Not revised Xandi (Average 2001-2004: 78%) 62 55% 20% Not revised Additional population getting access to primary 0 80,000 230,000 3 3 6,000 and secondary paved roads. Additional population protected from periodic 0 30,000 3 8,000 114,000 flooding. Number of operational NDCs. 0 14 10 Not revised Quantity of municipal waste collected in Porto- 25% 3 0% 65% Not revised Novo and transported out of the City (as % of the total quantity__ generated). Krsults tndicators for Each Component - Component One Billed tax collection rate (% of billed taxes recovered). ______._____--.-.___-- -Cotonou 81 (averagl 82 Not revised 200 1-2004 75% -Porto-Novo 52 58 Not revised -Parakou 64 65 Not revised -Abomey -Calavi 51 Not Not revised Available -Lokossa 19 Not Not revised Available -Kandi 92 (averagi Not Not revised 200 1-2004 Available 68%
24 -- Results Indicators for Each Component Baseline June 2010 Dcceinbcr 2010 Share of municipalities’ recurrent costs budgets allocated and spent on infrastructure and basic services, i.e. all recurrent costs by administrative operating expenses (as % of total expenditure). __._.______------Cotonou 80 77 Not revised -Porto-Novo 73 69 Not revised -Parakou 73 73 Not revised -Abomey-Calavi 38 56 Not revised -Lokossa 57 69 Not revised -Kandi 35 45 Not revised Share of municipalities’ recurrent costs budgets Not revised allocated and spent on routine road maintenance (as % of total expenditure). ._.______------~--.___-______---- -Cotonou 20 25-30 Not revised -Porto-Novo 27 25-30 Not revised -P arakou 29 25-30 Not revised -Abomey -Calavi 17 20-25 Not revised -Lokossa 14 15-20 Not revised -Kandi 5 15-20 Not revised Technical and administrative management 0 3 3 Not revised procedures manual developed and in use in the three primary cities. Periodic budget reports generated by the 3 6 6 Not revised municipalities. Solid Waste Management Guidelines for 0 1 1 Not revised Benin’s cities, agreeable to IDA, defined and adopted by MEHU. Component Two Km ofrehabilitated urban roads. 0 10 22 31.6 Km of drainage built. 0 3.2 4 14.8
25 ...... _.-. ^_I_._- Rcsults Iikdicators for Each Component Baseline April 2008 June 2010
Component Three Number of micro-projects (sub-component 3b) 0 11 APL phase 11 minimum. Not revised implemented and functional. two micro- Demand driven projects are - figures to be under cons- revised at Mid- truction and Term expected to be operational by Mid-Term Review Number of cities with an ooerational CISU. 0 6 6 I Not revised Component Four 1 Not revised Study on solid waste management in Porto- 0 1 1 Notrevised Novo carried out. Solid waste management plan and financing plan, agreeable to IDA, endorsed by local and central authorities. Solid Waste Management Unit in place and 0 1 1 Notrevised operational in the municipality ofPorto-Novo.
26 APPENDIX C: DETAILED PROJECT COSTS
Table C1: Cost Breakdown of Works for the Additional Financing (CFAF million, without tax)
Total IDA GOB Cities Collector P (Cotonou) Works 3,200.00 2,720.00 320.00 160.00 Technical studies, controVworks supervision 208.00 208.00 EIA and RAP 144.00 122.40 14.40 7.20 Delegated contract management 177.60 177.60 Sub-total 3,729.60 3,228.00 334.40 167.20 Collector W (Cotonou) Works 3,893.00 3,309.05 389.30 194.65 Technical studies, control/works supervision 253.05 253.05 EIA and RAP 175.19 148.91 17.52 8.76 Delegated contract management 216.06 216.06 Sub-total 4,537.29 3,927.06 406.82 203.41 Collector G (Porto-Novo) Works 2,111.00 1,794.35 211.10 105.55 Technical studies, controVworks supervision 137.22 137.22 EIA and RAP 95.00 80.75 9.50 4.75 Delegated contract management 117.16 117.16 Sub-total 2.460.37 2.129.47 220.60 110.30 Collector I(Porto-Novo) Works 586.00 498.10 58.60 29.30 Technical studies, controVworks supervision 38.09 38.09 EIA and RAP 26.37 22.41 2.64 1.32 Delegated contract management 32.52 32.52 Sub-total 682.98 591.13 61.24 30.62 Collector C (Parakou) Works 937.00 796.45 93.70 46.85 Technical studies, controllworks supervision 60.91 60.91 EIA and RAP 42.17 35.84 4.22 2.11 Delegated contract management 52.00 52.00 Sub-total 1,092.07 945.20 97.92 48.96 Collector B (Parakou) Works 255.00 216.75 25.50 12.75 Technical studies, controVworks supervision 16.58 16.58 EIA and RAP 11.48 9.75 1.15 0.57 Delegated contract management 14.15 14.15 Sub-total 297.20 257.23 26.65 13.32 Road 2250 along Collector P (Cotonou) Works 986.00 838.10 98.60 49.30 Technical studies, controVworks supervision 64.09 64.09 EIA and RAP 44.37 37.71 4.44 2.22 Delegated contract management 54.72 54.72 Sub-total 1,149.18 994.63 103.04 51.52 Rue SknadC I Avotrou I Tanto (Cotonou) Works 1,943.00 1,651.55 194.30 97.15
27 Total IDA GOB Cities Technical studies, controllworks supervision 126.30 126.30 EIA and RAP 87.44 74.32 8.74 4.37 Delegated contract management 107.84 107.84 Sub-total 2,264.57 1,960.00 203.04 101.52 Rue Rails Dodji /Route d'Adjarra (Porto-Novo) Works 739.00 628.15 73.90 36.95 Technical studies, controllworks supervision 48.04 48.04 EIA and RAP 33.26 28.27 3.33 1.66 Delegated contract management 41.01 41.01 Sub-total 861.30 745.47 77.23 38.61 Road along Collector C (Parakou) Works 259.00 220.15 25.90 12.95 Technical studies, controllworks supervision 16.84 16.84 EIA and RAP 11.66 9.91 1.17 0.58 Delegated contract management 14.37 I 14.37 I Sub-total 301.86 I 261.27 I 27.07 I 13.53 Road along Collector B (Parakou) Works 482.00 409.70 48.20 24.1C Technical studies, controVworks supervision 31.33 3 1.33 EIA and RAP 21.69 18.44 2.17 1.OE Delegated contract management 26.75 26.75 Sub-total 561.77 486.22 50.37 25.18 Other costs Technical and financial audits 1 70.001 70.001 I Delegated contract management 3.50 3.50 Sub-total 73.50 73.50 0.00 0.oc TOTAL 18,011.71 15,599.17 1,608.36 804.18
28 Table C2: Cost by City (amounts in CFAF million, without tax) Length Estimated City Designation (meters) cost I Collector "P" to the Fifadii dike 800 I 3,729.60 1 Downstream Dart of Collector "W" I 3,756 I 4,537.29 ~~~ Rue No2250 along collectorTP" coMecting Etoile- 1,600 1,149.18 Cotonou Akossombo with Avenue du Renouveau Rue Senadk I Avotrou I Tanto 3,610 2,264.57 Total collectors Cotonou 4,556 8,266.89 Total roads Cotonou 5,210 3,413.75 ~~ Total Cotonou 11,680.64 I UP-and downstream part ofCollector "G" 3,005 2,460.37 Add-on to Collector "I" 95 1 682.98 Porto-Novo Rue Rails Dodii I Route d'Adiarra 1,500 861.30 I Total collectors Porto-Novo I 3,956 I 3,143.35 I Total roads Porto-Novo I 1,500 I 861.30 Total Porto -Novo I I Downstream add-on to Collector 'IC" 1,605 1,092.07 Complementary works in the "B" Basin 773 297.20 Road along Collector "C" (resurfacing) 1,605 301.86 Parakou Roads along Collector "B" 1,348 561.77 Total collectors Parakou 2,378 1,389.28 Total roads Parakou 2,953 863.64 Total Parakou Total collkctors 1- 10,890 112,799.52 Total roads I 9.663 I 5.138.69 Total Works I I 17,938.21 Technical and financial audits 70.00 Other costs Delegated contract management 3.50 Total other costs 73.50 Overall Total 18,011.71
IDA GOB Cities Total Works 31.07 4.31 2.16 37.54 -Drainage works 21.22 2.95 1.47 25.63 - Road works 8.52 1.18 0.59 10.29 - EIA and RAP 1.34 0.19 0.09 1.62 Consultant services (Including delegated contract management) 4.38 0.00 0.00 4.38 Operating costs (Project Unit) 0.12 0.00 0.00 0.12 Contingencies 3.42 0.41 0.21 4.04 Cost overrun original project 1.00 0.00 0.00 1.00 Total costs 40.00 4.73 2.36 47.09
29 APPENDIX D: ECONOMIC AND FINANCIAL ANALYSIS
I.ECONOMIC ANALYSIS OF COST OVERRUN
1. The Additional Financing covers cost overruns of US$1 million @.e. 2.5 percent of the proposed Additional Financing) mainly to make up for the depreciation of the US. dollar, beyond what could have been anticipated at the time ofappraisal, and ensure that all activities included under the original project are completed as expected. Overall, the cost overruns in CFAF are estimated at 6.25 percent, which is below the 7 percent price and physical contingencies agreed in the Development Credit Agreement at the time of appraisal and negotiation ofthe Credit. However, the U.S. dollar has depreciated by about 12 percent compared to appraisal estimates (CFAF 440 to the dollar against CFAF 500 at appraisal) and the SDR has depreciated by 9 percent. The project has already disbursed 50 percent ofthe total amount and the credit was negotiated in SDR.
2. Table D1 below shows the detailed cost overrun along with the revised Economic Rates of Return (ERR) which were calculated as part of the appraisal of the Additional Financing.
ESTIMATED COST ACTUAL COST
Amount ERR Length Amount ERR City Road million) March6 de moutons I Carrefour Bourse du Travail 850 335 32.00% 663 281 39.00% Cotonou Raccordement Agbato / Collector Ytnawa 2,350 925 23.00% 2,505 1,141 22.00% Cine Okpe Oluwa I Lune Ste Ctcile 1,350 595 18.00% 1,270 505 24.00% Total Cotonou 4,550 1,855 4,438 1,927 Ouando / Dodji / Rails 1,800 780 32.00% 1,860 746 37.00% Porto- Novo Collector I(Dodji, Djbgan Kpbvi, Zounvi) 3,000 989 n.a. 2,852 1,161 n.a. Collector G (upstream) 1,300 585 n.a. 1,730 767 n.a. Total Porto-Novo froadd 1.800 780 1.860 746 Total Porto-Novo (collectors) 4,300 1,574 4,582 1,928 Alaga I Camp Adagbb 2,990 539 25.00% 2,744 636 20.00% Morgue Pont de Banikani Rond Point Maga 3,000 1,041 21 2,620 1,055 22.00% Parakou I I .OO% MusCe plein air / CEG4 / Madjatum 2,420 921 17.00% 2,293 862 20.00% Cliniaue Balawa / Rue de 1’Abattoir 410 59 45.00% 612 28 149.00% Total Parakou 8,820 2,560 8,269 2,581 Total roads 15,170 5,195 14,567 5,254 Total collectors 4,300 1,574 4,582 1,928 Overall total 6,769 7,182
3. The economic analysis, based on a cost-benefit analysis, examined the program of priority urban road works in the three primary cities (Cotonou, Porto-Novo, and Parakou) taking into account the 6.5 percent increase in costs. The analysis covered the urban roads to evaluate the “with project” and “without project” costs and benefits for each road to be
30 rehabilitated. The same analysis was not carried out for drainage, mainly due to a lack of reliable data as the economic and health impacts of a cessation of recurrent flooding and drainage could not be quantified. The economic analysis was performed using The Roads Economic Decision Model (RED). RED was developed under the Road Management Initiative (RMI), a component of the Sub-Saharan Africa Transport Policy Program (SSATP) aimed at improving the decision-making process for the development and maintenance of low-volume roads. The model performs an economic evaluation of road investments options using the consumer surplus approach and is customized to the characteristics of low-volume roads, e.g.: (i)the high uncertainty of the assessment of the model inputs, particularly the traffic and condition ofunpaved roads; (ii)the importance of vehicle speeds for model validation; (iii)the need for a comprehensive analysis of generated and induced traffic; and (iv) the need to clearly define all accrued benefits. RED computes benefits for normal, generated, induced, and diverted traffic, and takes into account changes in road length, conditions in the dry and wet seasons, geometry, surface type, and accident rates. RED was used rather than the Highway Development and Management Model (HDM-4) because of the type of investments (earth roads into pavedgravel roads, since the HDM-4 is not calibrated to take into account the road types and traffic volumes under investigation).
4. As shown in Table D1, the ERRSare all above 20 percent, taking into account the 6.5 percent increase in costs, demonstrating that the original project continues to be economically justified.
5. A multi-criteria analysis was also carried out on the drainage works as this method allows evaluation of a variety of objectives, not all quantifiable, in relation to the evaluated intervention. Two collectors (Iand G) in Porto-Novo are being funded under the original project. The additional Credit finances extension works on those same collectors. As a result, the multi-criteria analysis covers the entire program of works on those two collectors under the original and additional project. The analysis is presented in Section 11, below.
11. ECONOMICANALYSIS OF SCALED-UP ACTIVITIES
Summary of benefits and costs
6. The economic analysis, based on a cost-benefit analysis, examined the additional program of priority urban road works in the three primary cities (Cotonou, Porto-Novo, and Parakou). The analysis covered the urban roads to evaluate the “with project” and “without project” costs and benefits for each rehabilitation site. The same analysis was not carried out for drainage, mainly due to a lack of reliable data as the economic and health impacts of the drainage and cessation of recurrent flooding could not be quantified. Instead, a multi-criteria analysis was carried out on the drainage works, as this method allows evaluation ofa variety ofobjectives, not all quantifiable, in relation to the evaluated intervention.
31 Road investments
7. This priority program, subject ofthis component, was: (i)determined by the cities; (ii)comprised solely of investments having a sufficient economic rate ofreturn (ERR >12 percent for roads); and (iii)complementary to existing networks. Additionally, beneficiary cities will have to commit to finance recurrent costs for these investments as well as for the existing infrastructure. Counterpart contribution level was established to 5 percent of the cost ofworks, based on an estimate ofreal ability to pay and the required equity incentive, in line with the first two phases ofthe APL.
8. An economic analysis was performed for the road works program in Cotonou, Porto-Novo, and Parakou, evaluating five streets with a total length of 9.6 kilometers representing a total investment ofUS$10.02 million. The economic analysis of the entire road works program yields an ERR of 50 percent and an NPV of US$15.18 Million (at a 12 percent discount rate), as presented in Table D2 and detailed in this Section.
Table D2. Summary of the economic analysis of the road investments
NPV NPV City Road ERR (CFAF (US$ million) million) Rue No2250 along collector “P” 32% 84 1 1.91 Cotonou Rue SBnadt I Avotrou I Tanto 71% 4.266 9.70 Road along Collector “C” (resurfacing) 38% 324 0.74 Parakou Roads along Collector “B” 26% 247 0.56 Porto-Novo Rue Rails Dodji I Route d’Adjarra 41% 1,002 2.28 Totauaverage 50 % 6,680 15.18
9. The economic criteria for selection and prioritization ofinfrastructure investment are the ERR and the NPV of each proposed investment. The cut-off ERR is 12 percent. The final priority investment program was determined on the basis ofthe economic criteria and other parameters such as population served and accessibility to low income neighborhoods, contribution to the connectivity of the network, and complementary between the road and the drainage networks.
10. Methodology used for the economic analysis. The economic analysis was performed using the Roads Economic Decision Model (RED) as presented above. To determine net incremental costs and benefits off the road investments, “with” and “without” project were considered. On the basis of these scenarios, the net incremental financial benefits and costs of the proposed investment programs were assessed. These were then adjusted for the impact of taxes, subsidies and externalities to arrive at the economic cost and benefit streams. Costs include capital costs, operation and maintenance costs, and rehabilitation costs.
11. Road User Benefits. The road user benefits quantified are those involving vehicle operating costs and passenger time costs. The cost ofcongestion on existing roads that will be relieved once the roads are improved was not taken into account, nor the benefits
32 derived from diverted traffic from alternative roads. These conservative assumptions allow for a cautious economic evaluation. Unit road user costs were evaluated using the Highway Development and Management Model (HDM-4) relationships, which simulates life cycle conditions and costs and provides economic decision criteria for multiple road design and maintenance alternatives. Table D3 presents the vehicle fleet characteristics and economic unit costs which were updated during the appraisal mission.
Table D3: Vehicle fleet characteristics and economic unit costs
Motor Car Pick- Mini- Medi Light Heavy Articulated urn -cycle bus bus truck truck truck
New Vehicle Cost (US$/vehicle) 1,040 26,000 40,000 50,000 170,000 76,000 170,000 240,000 New Tire Cost (US$/tire) 11 114 125 136 227 273 273 273 Fuel Cost (US$/liter) 0.80 0.80 0.80 0.80 0.80 0.80 0.80 0.80 Lubricant Cost (US$/liter) 2.95 2.95 3.18 2.95 3.18 3.18 3.18 3.18 Maintenance Labor Cost (US$/how 1.14 3.41 3.41 4.09 4.55 4.55 5.68 5.68 Crew Cost (US$/hour) 0.45 0.68 0.68 1.14 1.82 1.36 1.36 2.27 Overhead (US$) 0 0 0 0 0 0 0 0 Interest Rate (“h) 12 12 12 12 12 12 12 12 Passenger Time (US$/hour) 0.50 0.60 0.50 0.50 0.50 0.00 0.00 0.00 Cargo Delay (US$/hour) I 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 ~ ~~~ ~ ~~ Utilization and Loading Kilometers Drivenper Year (km) 20,000 35,000 35,000 70,000 100,000 50,000 50,000 100,000 Hours Drivenper Year (hr) 1,000 1,000 1,200 2,500 2,500 2,000 2,200 2,500 Service Life (years) 8 10 10 10 10 10 10 10 % ofTime for Private Use (%) 30.00 60.00 10.00 5.00 2.00 0.00 0.00 0.00 Number ofPassengers 2 4 2 12 20 0 0 0 Gross Vehicle Weight (tons) 0.3 2.0 2.5 3.0 7.5 12.0 25.0 45.0
The annual traffic growth rate was defined based on recent trends and was set conservatively to 4.5 percent for the duration ofthe analysis period that was considered to be 15 years.
12. Road Agency Costs. Road constructionhehabilitation costs are based on the financial costs of road works, net of tax, to adjust for economic costs. The financial costs have been provided by AGETUR based on its experience under the original project. Taking into account the pavement technology used for roads financed by the proposed project (interlocking pavement blocks on a sand-covered base), the roads to be rehabilitated will require minimum maintenance during the first 20 years, provided that regular routine maintenance is carried out. Maintenance unit costs and standards “with project’’ and “without project” are taken to be the ones used by the cities.
33 Economic Evaluation
13. Table D4 below presents the basic characteristics of the streets evaluated, indicating that currently travel speeds are around 20 to 25 kilometers per hour and they are expected to increase to around 40 to 60 kilometers per hour after the project.
Speeds Without Speeds With Length Project Project City Road (km/hr)Dry I (km/hr)Wet Rue No2250 along collector "P" Cotonou 1 1.600 I 25 I 20 I 60 I 40 I Rue SBnadB I Avotrou I Tanto I 3.610 I 25 I 20 I 60 I 40 Road along Collector "C" (resurfacing) 1.605 25 20 60 40 Parakou Roads along Collector "B" 1.348 25 20 60 40 Porto-Novo Rue Rails Dodji / Route d'Adjarra 1.500 25 20 60 40 Total 9.663
14. Traffic. Traffic counting was carried out in February 2008 as part of the preparation of the Additional Financing for each type of vehicle (motorbikes, cars, trucks - see Tables below) and on each of the six streets included in the proposed program. Table D5 presents the average daily traffic and traffic composition of each street, which indicates and average daily traffic of 9,292 vehicles per day including motorcycles. The average daily traffic offour wheel vehicles is 1,101 vehicles per day.
Table D5: Average annual daily traffic
4 Wheel Total Motor- Cars ' Buses Trucks Traffic City Road Traffic cycles Pickups (AADT) (Yo) (Yo) ("/I ("/I (AADT) Rue 2250 along collector "P" 8,160 82.5 16.2 0.5 0.8 1,427 Cotonou No Rue Shad6 I Avotrou i Tanto 18,047 86.9 12.5 0.2 0.4 2,371 Road along Collector "C" (resurfacing) 2,857 90.5 8.2 0.4 0.9 270 Parakou Roads along Collector "B" 5.418 92.7 6.2 0.1 1.o 394 IPorto-Novo IRueRailsDodiiIRouted'Adiana 1 11,979 I 91.3 I 7.9 I 0.6 I 0.2 I 1,045 I
~~ I Average I 9,292 I 88.8 I 10.2 I 0.4 I 0.7 I 1,101
15. Road investment costs. Table D6 presents the investment costs, comprising the costs and physical contingencies of road works, which indicates an average investment cost ofUS$1.04 million per kilometer and a total investment cost ofUS$10.02 million.
34 Table D6: Financial investment costs
16. Beneficiary population. Table D7 presents, for each street, the beneficiary population, defined as the population of the neighborhoods served by the street. The overall cost-efficiency ofthe investments is US$132 per beneficiary population.
Beneficiary Investment/ Population/ City Road Population Population Kilometer (persons) (US$/person) (persons/km) Rue No2250 along collector "P" 10,952 238 6,845 Cotonou Rue Sbnadt / Avotrou / Tanto 41.100 125 11.385 Road along Collector "C" (resurfacing) 30,673 22 19,111 Parakou Roads along Collector "B" 10,149 126 7,529 Porto-Novo Rue Rails Dodji / Route d'Adjarra 13,187 148 8,791 TotaUaverage 106,061 132 10,732
Sensitivity Analysis
17. The results are satisfactory relative to the main risks considered in the economic analysis, namely, higher investment costs (10 percent increase) and lower future benefits mainly due to lower traffic (10 percent decrease).
111. Multi-criteria analysis of the collectors under the original project and Additional Financing
Methodology
18. The collectors are expected to alleviate problems associated with flooding of the concerned neighborhoods during the rainy season, which lasts several months, and the resulting negative effects on the quality of life and social conditions. They are designed to drain the immediate catchment area they transverse, and thus improve the living conditions, reduce the negative effects of malaria on the affected population and increase the value of land. Due to the nature of the benefits of the collectors and the difficulties inherent in quantifying and calculating these benefits, the evaluation of the collectors has been carried out by using a multi-criteria analysis, which was conducted as part ofproject preparation.
35 Cotonou
19. Collector P to the Fifadji dike. This collector assures the drainage of the two neighborhoods (“arrondissements”) Sainte Rita and Fifadji. The neighborhoods directly concerned, and which constitute the immediate catchment area, are Fifadji, Vossa Kpodji, MidCdji, Missitb, and MissogbC. The population of the catchment area is 20,290 persons (2008), constituting about 2.7 percent ofthe population ofCotonou.
20. Downstream part of Collector W. Collector W assures the drainage of the first and second arrondissements, SbnadC and Dandji. The neighborhoods directly served by the collector are Shad6 1, KowCgbo, Tanto, and Avotrou. The population of the catchment area is 16,269 persons (2008), constituting about 2.2 percent ofthe population ofCotonou.
21. Construction of the two collectors included in the works program for Cotonou will directly benefit about 36,558 inhabitants, constituting about 4.8 percent of the population of Cotonou.
Porto-Novo
22. Upstream and downstream part of Collector G. This collector transects the second and fourth arrondissements of Porto-Novo. The neighborhoods directly served by the collector are Agbokou 1, Agbokou 2, KandCviC 3, and Sedjeko. The population ofthe catchment area is 13,859 persons (2008), constituting about 5.4 percent of the population ofPorto-Novo.
23. Add-on to Collector I. This collector runs entirely in the fourth arrondissement. The neighborhood directly served is AnanviC with a population of 3,683 persons (2008).
24. These two collectors were funded under the original project. The additional Credit finances extension works on those same collectors. As a result, the multi-criteria analysis covers the entire works programmed on those two collectors under the original and additional projects.
25. Construction of the two collectors included in the works program for the Additional Financing for Porto-Novo will directly benefit an additional estimated 17,542 inhabitants, constituting about 6.9 percent of the population of Porto-Novo.
Parakou
26. Downstream add-on to Collector C. In conjunction with the road along Collector C, this drainage work forrns a border between the first and second arrondissements and thus benefits both administrative areas. The two arrondissements in the catchment area are Kpbbib and Banikani. The neighborhoods directly benefiting from the works are Albarika, KpebiC, and Banikani with a population of about 16,876 (2008), constituting about 9.0 percent ofthe population ofParakou.
36 27. Upstream part of Collector B. This collector has direct benefits on the GuCma area in the first arrondissement, more specifically the GuCma and Amaouignon Dkkparou neighborhoods. The population ofthe catchment area is 5,075 persons (2008).
28. In total, the construction of the two collectors included in the works program for Parakou will directly benefit about 21,951 inhabitants, constituting about 11.7 percent of the population of Parakou.
Criteria for the evaluation of collectors
29. The criteria for the evaluation ofcollectors have been selected as follows:
The length of the collector. The beneficiary population in the immediate catchment area. The population density (persons per kilometer of collector). (This criterion is a measure of the demographic pressure in the immediate catchment area of the collector, which is made up of the built-up area in the contributory basin and sub- basins. The size of this population represents the number of persons exposed to flooding and waterborne diseases, the most prominent ofthese being malaria). 0 The cost ofthe investment per beneficiary. The number of days of nuisance or duration of rain and subsequent infiltration of the water during a year (the number of days of nuisance is calculated based on the annual number of rainy days to which is added the number of days for total infiltration of the water).
Summary of the multi-criteria analysis of collectors
30. Each criterion is weighed in the analysis. The maximum overall score is 80 and the minimum required score for eligibility is 40. All collectors having obtained the minimum required score are eligible for financing under the proposed Additional Financing. All six collectors included in the proposed program of works have been subjected to the multi- criteria analysis and have obtained a score of 40 or above. The average score for the six collectors is 51 and scores for individual works vary between 40 and 61. These scores are mainly obtained based on the high number ofbeneficiaries and severity and long duration ofthe nuisances experienced.
37
Map section
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E SakétéSakété MONOM O N O ATLANTIQUEATLANTIQUE Ibadan RIVERS This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other information ABOMEY-CALAVI MAIN ROADS shown on this map do not imply, on the part of The World Bank LOKOSSA
Group, any judgment on the legal status of any territory, or any Mono RAILROADS endorsement or acceptance of such boundaries. OuidahOuidah PORTO NOVO To DEPARTMENT BOUNDARIES Lomé COTONOU LITTORALLITTORAL 0° 1°E 2°E 3°E INTERNATIONAL BOUNDARIES Gulf of Guinea MARCH 2008