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Document of The World Bank

Public Disclosure Authorized Report No: ICR00001853

IMPLEMENTATION COMPLETION AND RESULTS REPORT (IBRD-48300)

ON A

Public Disclosure Authorized LOAN

IN THE AMOUNT OF US$200 MILLION

TO THE

PEOPLE’S REPUBLIC OF CHINA

FOR A

THIRD JIANGXI HIGHWAY PROJECT Public Disclosure Authorized

June 29, 2011

China and Mongolia Sustainable Development Unit Sustainable Development Department East Asia and Pacific Region

Public Disclosure Authorized

CURRENCY EQUIVALENTS

(Exchange Rate Effective March 30, 2011)

Currency Unit = RMB Yuan RMB1.00 = US$0.151 US$1.00 = RMB 6.60

FISCAL YEAR January 1 – December 31

ABBREVIATIONS AND ACRONYMS

ADT Average Daily Traffic ARE Ruijin-Fujian border Expressway BOT Build-Operate-Transfer CAS Country Assistance Strategy CPS Country Partnership Strategy EAP Environmental Action Plan EIA Environmental Impact Assessment EMP Environmental Management Plan EIRR Economic Rate of Return ETC Electronic Toll Collection E&M Electrical and Mechanical FIRR Financial Internal Rate of Return FYP Five Year Plan GDP Gross Domestic Products HRI Highway Research Institute ICB International Competitive Bidding IDF Institutional Development Fund IEG Independent Evaluation Group (World Bank) ISP Institutional Strengthening Program JPCD Jiangxi Province Communications Department (later, Renamed as JPTD) JPH3 Third Jiangxi Highway Project JPTD Jiangxi Province Transportation Department km Kilometer LRIP Local Roads Improvement Program M&E Monitoring and Evaluation MOC Ministry of Communications MOT Ministry of Transport MOF Ministry of Finance NCB National Competitive Bidding NEN National Expressway Network NPV Net Present Value NTHS National Trunk Highway System PAD Project Appraisal Document

PCU Passenger Car Unit (equivalent) PDO Project Development Objectives PMO Project Management Office PPIAF Public-Private Infrastructure Advisory Facility QAG Quality Assurance Group (in the World Bank) RAP Resettlement Action Plan RRPIP Rural Road Pavement Improvement Program RGE Ruijin-Ganzhou Expressway RMB Renminbi (Chinese Yuan) VOC Vehicle Operating Costs vpd Vehicles per day

Vice President: James Adams, EAPVP Country Director: Klaus Rohland, EACCF Ede Jorge Ijjasz-Vasquez, EASCS; and Sector Managers: Narasimham Vijay Jagannathan, EASIN Project Team Leader: Fei Deng, EASIN ICR Team Leader: Fei Deng, EASIN

CHINA Third Jiangxi Highway Project

CONTENTS

Data Sheet A. Basic Information B. Key Dates C. Ratings Summary D. Sector and Theme Codes E. Bank Staff F. Results Framework Analysis G. Ratings of Project Performance in ISRs H. Restructuring I. Disbursement Graph

1. Project Context, Development Objectives and Design ...... 1 2. Key Factors Affecting Implementation and Outcomes ...... 3 3. Assessment of Outcomes ...... 7

4. Assessment of Risk to Development Outcome ...... 11 5. Assessment of Bank and Borrower Performance ...... 11 6. Lessons Learned...... 13 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners...... 14 Annex 1. Project Costs and Financing ...... 15 Annex 2. Outputs by Component...... 16 Annex 3. Economic and Financial Analysis ...... 18 Annex 4. Bank Lending and Implementation Support/Supervision Processes ...... 23 Annex 5. Environmental and Social Mitigation and Impact...... 25 Annex 6. Stakeholder Workshop Report and Results ...... 36 Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR ...... 37 Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ...... 46 Annex 9. List of Supporting Documents ...... 47 MAP 34205

A. Basic Information

Third Jiangxi Highway Country: China Project Name: Project Project ID: P093906 L/C/TF Number(s): IBRD-48300 ICR Date: 06/29/2011 ICR Type: Core ICR PEOPLES REPUBLIC Lending Instrument: SIL Borrower: OF CHINA Original Total USD 200.0M Disbursed Amount: USD 189.7M Commitment: Revised Amount: USD 195.0M Environmental Category: A Implementing Agencies: Jiangxi Provincial Communications Department Cofinanciers and Other External Partners:

B. Key Dates Revised / Actual Process Date Process Original Date Date(s) Concept Review: 04/12/2005 Effectiveness: 02/08/2007 02/08/2007 Appraisal: 01/03/2006 Restructuring(s): 08/14/2009 Approval: 06/27/2006 Mid-term Review: Closing: 12/31/2010 12/31/2010

C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Satisfactory Risk to Development Outcome: Low or Negligible Bank Performance: Satisfactory Borrower Performance: Highly Satisfactory

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Quality at Entry: Satisfactory Government: Highly Satisfactory Implementing Quality of Supervision: Satisfactory Highly Satisfactory Agency/Agencies: Overall Bank Overall Borrower Satisfactory Highly Satisfactory Performance: Performance:

C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments Indicators Rating Performance (if any) Potential Problem Project Quality at Entry Yes None at any time (Yes/No): (QEA): Problem Project at any Quality of No None time (Yes/No): Supervision (QSA): DO rating before Satisfactory Closing/Inactive status:

D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) Roads and highways 97 97 Sub-national government administration 3 3

Theme Code (as % of total Bank financing) Infrastructure services for private sector development 33 33 Injuries and non-communicable diseases 17 17 Rural services and infrastructure 17 17 Trade facilitation and market access 33 33

E. Bank Staff Positions At ICR At Approval Vice President: James W. Adams Jeffrey S. Gutman Country Director: Klaus Rohland David R. Dollar Sector Manager: Ede Jorge Ijjasz-Vasquez Jitendra N. Bajpai Project Team Leader: Fei Deng Christopher R. Bennett ICR Team Leader: Fei Deng ICR Primary Author: Hernan Levy

F. Results Framework Analysis

Project Development Objectives (from Project Appraisal Document) The project development objective is to improve east-west passenger and freight flows in Jiangxi province by investing in the construction of an expressway, enhancing local roads, and strengthening highway management. (The description of the PDO in the Loan Document is substantially the same as the PAD).

The objectives will be measured using the following outcome indicators:

- in the Ruijin-Ganzhou corridor: (a) increased average daily traffic; (b) decreased accidents on the existing road G323; and (c) decreased travel time from Ruijin to Ganzhou;

- for the road sections of the Local Roads Improvement Program: (a) increased average daily traffic; (b) reduced number of days closed; (c) reduced travel times; (d) increased bus services; and

- implementation of key recommendations from the institutional strengthening components with regard to tunnel safety, roadside safety, and electronic toll collection.

Revised Project Development Objectives (as approved by original approving authority)

The objectives were not revised.

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(a) PDO Indicator(s)

Original Target Formally Actual Value Values (from Revised Achieved at Indicator Baseline Value approval Target Completion or documents) Values Target Years A. Ruijin-Ganzhou Expressway (RGE) Average daily traffic in the RGE Expressway (passenger car equivalent, Indicator 1 PCU, per day per section) A-B Ruijin-Huichang 14,000 8,530 B-C Huichang-Yudu 15,000 9,451 C-D Yudu-Ganxian 16,000 11,180 D-E Ganxian-Zhanggong 17,000 11,972 Date achieved 12/31/2005 12/31/2010 10/31/2010 Target will be achieved after the connecting ARE expressway opens end of 2011. Comments When the ARE opens, the RGE will connect directly with the expressways in Fujian province. Average daily traffic route G323 (passenger car equivalent, PCU, per day Indicator 2 per section) A-B Ruijin-Huichang

7,321 4,000 6,369 B-C Huichang-Yudu

11,011 6,000 13,383 C-D Yudu-Ganxian

10,137 6,000 9,890 D-E Ganxian-Zhanggong

12,164 8,000 16,150 Date achieved 12/31/2005 12/31/2010 12/31/2010 Target likely to be achieved end 2011, when the full RGE will be in operation. This will increase diversion of G323 traffic to the RGE, further reducing G323 Comments traffic. Still, the objective of reducing congestion on the G323 has been largely achieved. Indicator 3 Average accident rate/(fatal) route G323 (per 100,000,000 vehicle-kilometer) Ruijin 23.87/(2.01) 15/(0.83) 28.79/(1.85) Huichang 34.80/(0) 18/(1.11) 4.45/(4.13) Yudu 14.89/(1.49) 11/(0.87) 4.64/(2.45) Ganxian 19.50/(2.05) 13/(1.07) 2.72/(0.98) Zhonggong 24.93/(1.25) 5/(0.52) 9.29/(0.77) Date achieved 12/31/2005 12/31/2010 12/31/2010 Partially achieved, although large yearly variances in accident and fatality rates Comments result in difficulties in data interpretation. Indicator 4 Average travel time Ruijin-Ganzhou (minutes) 150 75 75 Date achieved 12/31/2005 12/31/2010 6/24/2011 Will be achieved end-2011, when the ARE expressway is completed and the last Comments 9 km of the RGE, which are already built, are put in operation.

B. Local Road Improvement Program (LRIP) Chongyi-Fengzhou Road

Indicator 5 Average daily traffic (passenger car equivalent, PCU, per day) 1,299 1,800 2,588 Date achieved 12/31/2005 12/31/2010 12/31/2010 Achieved. Actual traffic on the Chongyi-Fengzhou road has greatly exceeded the Comments target. Indicator 6 Number of days closed per year 88 10 0 Date achieved 12/31/2005 12/31/2010 12/31/2010 Achieved. No road closures are now taking place on the Chongyi-Fengzhou road, Comments thanks to the project-financed improvements. Indicator 7 Average travel time in road section (minutes) 180 60 50 Date achieved 12/31/2005 12/31/2010 12/31/2010 Comment Achieved. Indicator 8 Daily bus service (buses per day) 18 40 45 Date achieved 12/31/2005 12/31/2010 12/31/2010 Comments Achieved. C. Institutional Strengthening

Implementation of Key Recommendations Indicator 9 JPCD adopts tunnel safety management plan No tunnel safety Policy adopted Policy adopted management plan Date achieved 12/31/2005 12/31/2010 12/31/2010 Achieved. International good practice incorporated and the management plan Comments adopted in the province as standard of practice. Reduced accident rate/(fatalities) in the Expressway network in Jiangxi Indicator 10 Province (per 100,000,000 vehicle-kilometers) 7.61/(0.37) 6.15/(0.24) 5.98/(0.22) Date achieved 12/31/2005 12/31/2010 12/31/2010 Achieved. Detailed assessment conducted to identify risk factors in the expressway network in the province, practical measures proposed with Comments international good practice incorporated, pilot tested under the Project, findings being disseminated to other provinces and EAP countries. Indicator 11 Electronic toll collection (ETC) implemented by JPCD No ETC in province Policy adopted Policy adopted Date achieved 12/31/2005 12/31/2010 12/31/2010 Achieved. Role of the Bank project was limited to supporting work already Comments launched by the JPTD. Over 100 ETC expressway lanes are in operation in Jiangxi Province’s expressways.

(b) Intermediate Outcome Indicator(s)

Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised approval Completion or Target Values documents) Target Years Completion of 117 kilometers of the Ruijin-Ganzhou Expressway (Percent Indicator 1 completed) 1A-Expressway 100 100 1-B Bridges 100 100 1-C Tunnels 100 100 1-D Interconnecting 100 100 Roads 1-E Interchanges and at grade 100 100 separation Date achieved 12/31/2005 12/31/2010 April 1, 2009 Achieved. Full RGE built. A 9-km section to open end 2011. See comments for Comment Outcome Indicator 1. Indicator 2 Successful improvement of local roads in the Ganzhou City Prefecture 2-A Phase I 83.3 km 48.5 km Date achieved 12/31/2005 12/31/2010 12/31/2008 LRIP scope Phase I following project restructuring was reduced to Chongyi- Comment Fengzhou Road (48.5 km). Indicator 3 Successful completion of institutional strengthening (studies and training) 3-A Tunnel safety 100% Completed 3-B Roadside safety 100% Completed 3-C Electronic Toll Collection 100% Completed 3-D Training (domestic and 100% Completed foreign) Completed, but 3-Equipment 100% reduced (see Annex 2) Date achieved 12/31/2005 12/31/2010 12/31/2010 All institutional strengthening activities were completed, some recommendations Comment have been implemented and others are being implemented.

G. Ratings of Project Performance in ISRs

Actual Date ISR No. DO IP Disbursements Archived (USD millions) 1 12/04/2006 Satisfactory Satisfactory 0.00 2 05/30/2007 Satisfactory Satisfactory 6.50 3 10/25/2007 Satisfactory Satisfactory 24.13 4 05/23/2008 Satisfactory Moderately Satisfactory 95.26 5 02/13/2009 Satisfactory Satisfactory 177.78 6 05/20/2009 Satisfactory Satisfactory 189.67 7 11/19/2009 Satisfactory Satisfactory 189.67

H. Restructuring (if any)

ISR Ratings at Amount Board Restructuring Disbursed at Restructuring Reason for Restructuring & Approved Restructuring Date(s) Key Changes Made PDO Change DO IP in USD millions Restructuring was approved by the Board on August 14, 2009. The main purpose of the restructuring was to reduce the scope of the Local Roads Improvement Program (LRIP) component in light of the launching by the State Government of a Rural Roads 08/14/2009 N S S 189.67 Pavement Improvement Program (RRPIP). Following the reduction in the size of the LRIP and Jiangxi Province’s financial stress, the Bank agreed to the Province’s request to increase the disbursement rate from 21 percent to 41 percent.

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I. Disbursement Profile

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1. Project Context, Development Objectives and Design

1.1 Context at Appraisal

The Government of China is committed to developing an efficient multimodal transport system to enhance competitiveness and promote development. Construction of the National Trunk Highway System (NTHS), comprising 12 major expressways connecting all provincial capitals and main cities is at the core of the system.

Jiangxi province, in south central China with a population of over 40 million, is one of the lagging regions in China with 32 counties out of a total of 99 counties and cities in Jiangxi identified as poor and. Ganzhou City Prefecture is the largest prefecture and has most of the poor counties in the province. With a population of over 8 million, the prefecture has agricultural, mineral and manufacturing industries. There is significant potential for growth in the mining industries. Ganzhou City Prefecture is poorly served by local roads. Lack of transport accessibility is one of the constraints to the social and economic development of the prefecture. The Ruijin-Ganzhou Expressway (RGE), planned to link Guangzhou and the area east to an expressway under construction in Fujian province, would provide a high quality transport link to the coastal and international port at Xiamen (Fujian province).

The two previous Bank highway projects have helped Jiangxi Provincial Communications Department (JPCD, later changed to JPTD) improve their operations in a number of key areas, such as safety and road maintenance. However, more needs to be done, including further improvement of planning and safety processes at the JPCD. The rationale for Bank assistance lies on: (i) the critical importance of the NTHS’ east-west linkages for the development of China’s lagging regions; (ii) the local roads will address the needs of the poor and disadvantaged people within Ganzhou City Prefecture; and (iii) the project will build upon the institutional strengthening from the Bank’s previous projects to assist JPCD manage the road network effectively.

1.2 Original Project Development Objectives (PDO) and Key Indicators

The objective of the project is to improve east-west passenger and freight flows in Jiangxi province by investing in the construction of an expressway, enhancing local roads and strengthening highway management.

Achievement of these objectives will be measured using the following outcome indicators:

 in the Ruijin-Ganzhou corridor: (a) increased average daily traffic, (b) decreased accidents on the existing road G323; and (c) decreased travel time from Ruijin to Ganzhou  for the road sections of the Local Road Improvement Program: (a) increased average daily traffic; (b) reduced number of days closed; (c) reduced travel times; (d) increased bus services; and  implementation of key recommendations from the institutional strengthening components with regard to tunnel safety, roadside safety and electronic toll collection.

1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification.

The PDO was not revised.

1.4 Main Beneficiaries

The main beneficiaries of the project are:

 People and shippers, originating in Jiangxi province, in neighboring Fujian or in other provinces, traveling long distance along major routes such as Guangzhou-Beijing.  Residents of Ganzhou City Prefecture, who will benefit from the improvement of a local road, which facilitates access to markets and social services.  Users of Jiangxi’s main road network benefit from improved road safety in expressways and tunnels.  JPCD gains from improved management of the road system.

1.5 Original Components

Component A: Ruijin-Ganzhou Expressway, RGE (US$627 million, including contingencies).

Construction of the RGE in the southern part of Jiangxi Province, including: (a) construction of about 117 kilometer of a divided, two-by-two lane, access controlled expressway between the cities of Ganzhou and Ruijin, including bridges and tunnels; (b) supply and installation of electrical, electronic, and mechanical equipment for toll collection, traffic monitoring, lighting and emergency telecommunications facilities; and (c) construction of related toll stations, interchanges, service areas, as well as facilities for highway administration and maintenance of the expressway.

Component B: Local Roads Improvement Program, LRIP (US$74 million, including contingencies).

Development and implementation of a Jiangxi Province Local Roads Improvement Program (LRIP) to improve access in selected poor areas of the province, including: (a) rehabilitation and upgrading of the Chongyi-Fengzhou Road (about 48.5 km) and the Meicun-Longbu Road (about 34.8 km); and (b) rehabilitation and upgrading of additional selected road sections.

Component C: Institutional Strengthening (US$10 million, including contingencies).

This component consisted of four technical assistance subcomponents, intended to (i) produce a tunnel safety management plan, (ii) improve safety conditions on expressways, (iii) support the implementation of electronic toll collection for expressways, and (iv) provide training and equipment for expressway management, maintenance and environmental monitoring.

1.6 Revised Components

The board approved the restructuring of the project to reduce the scope of the Local Road Improvement Program (LRIP) component and to make related adjustments in intermediate results and indicators. One road section was canceled from Phase I of the LRIP, and the four road sections originally planned under Phase II were reduced to one section. Subsequent to the restructuring, the one road section selected under phase II was also canceled due to misprocurement. The disbursement rate for the LRIP component increased from 25% to 41% as a result of the project restructuring and the consequent reduction in the size of the LRIP program.

The main reason for project restructuring was the change in the investment focus of Ganzhou prefecture to act upon the State directive (2006) to implement a significant Rural Roads Pavement Improvement Program (RRPIP). The RRPIP program covered about 15,000 kilometers of rural roads and was expected to link almost all villages of this prefecture by 2010 and serve about four million villagers.

1.7 Other significant changes

The scope of the electronic toll collection study was modified to reflect an early start of ETC in Jiangxi province, outside the project (see Section 3.2). The equipment component was substantially reduced (see Section 3.2).

2. Key Factors Affecting Implementation and Outcomes

2.1 Project Preparation, Design and Quality at Entry

Lessons Reflected in Project Design. The Bank’s extensive experience on numerous highway projects in China and the corresponding lessons were incorporated into the project design. Among them:

 The development plans of large urban centers should be incorporated early in the project design of national and provincial transportation links. The development plans of Ganzhou and Ruijin cities were incorporated early in the project design to ensure good linkages to the expressway and the alignment and some interchanges were adjusted accordingly.  The preparatory activities greatly contribute to the project’s success. Early preparatory work, including land acquisition, resettlement, environmental impact and design studies contributed to project readiness.  Ensure client ownership of institutional components. The proposed institutional strengthening component builds on the achievements of two previous Bank highway projects in Jiangxi Province, and the lessons of other highway projects in China.

Alternatives Considered. Analysis of the project components considered the following alternatives:

 Linkage with Fujian Province. A 31-km expressway section linking Ruijin with the Fujian border was considered but was not included in the project. In the expectation that a

BOT concession contract signed with Hong-Kong, based company to build this section would allow this section to be completed early and feed traffic to Jiangxi’s expressways.  Scope of the LRIP. Expanding the scope of the LRIP to allow any local road in the province to be eligible was considered; however, it was decided to focus only on road sections located in Ganzhou City Prefecture.  RGE Alignment Alternatives. The original RGE feasibility study considered a southern and a northern alignment. After further work, a combination of both alternatives was selected that minimizes the resettlement requirements and limits negative environmental impacts.

Jiangxi Government commitment was strong. It supported the objective and components as well as provided adequate and timely funding for the preparatory activities. Stakeholders were involved and their views are reflected in the design.

Quality at Entry was satisfactory with good compliance of safeguards requirements, technical and economic analysis, and readiness for implementation. The project was not included in the Quality Assurance Group’s sample of projects evaluated for quality at entry.

Risks

At appraisal, the only risk assessed as substantial was that the RGE might not attract or generate sufficient traffic. This risk was mitigated through an independent review of the traffic model, assurances that an appropriate toll rate would be set, confirmation that local government development plans were integrated with the expressway planning to ensure adequate access, and reviewing the plans for upgrading interconnecting roads before opening of the RGE.

The risk relating to the timely construction of the Ruijin-Fujian expressway (known as the ARE expressway), with its related impact on traffic development until such construction is completed, materialized. Given that the BOT contractor was already selected and in place at the time of appraisal, the risk was expected to be related mainly to meeting safeguards requirements. In practice, however, the BOT contractor failed to reach financial closure, leading to contract cancellation. The protracted legal procedures until ARE expressway construction could be started by JPTD, meant that the expressway was not completed on time. However, as discussed in Section 3.3, the delay in completing the ARE expressway will not have a major impact on the achievement of the PDO.

2.2 Implementation

The project was completed on time and the main component, the RGE, was completed ahead of the original schedule. No mid-term review was carried out.

The key implementation issues and the actions taken to resolve them are discussed below.

Construction and opening of the RGE.  Opening of the RGE to traffic required a temporary link with the Fujian expressway network until the Ruijin-Fujian Expressway was completed. A temporary road connection between the RGE and the national road G323 will be in place until the ARE opens at the end of 2011.  Safety aspects needed improvement during implementation (For example, guardrails were not connected with bridges at various locations, fences along the expressways

showed damage, interconnecting roads were unsafe, and signaling at ramps was insufficient. These problems were remedied following recommendations made by Bank supervision missions.

Failure of the BOT Scheme for the Ruijin-Fujian (ARE) Expressway. While this expressway was not part of the project, its construction impacted the project because ARE is a vital link of the RGE with the Fujian expressways and related connections with other NTHS expressways. JPCD launched construction of the expressway under its own financing and execution, after rescinding the BOT contract.

Implementation of the LRIP program and project restructuring. Problems with counterpart financing, resulting from the Jiangxi RRIP program led to reducing the scope of the LRIP component. Implementation was further complicated by the selection and later replacement by Ganzhou local government, of LRIP roads (Meilin-Longbu replaced by Anyuan-Dingnan road, and Chongyi-Longgou replaced by Xinjeng-Chijiang road, although the latter replacement was too late for implementation within the project timeframe). Misprocurement by the Guangzhou City Prefecture led to the cancellation of the Chongyi-Longgou (See Section 2.4). The Chongyi- Fengzhou road improvements, completed in December 2008 (due to major flooding in July 2009 that caused the collapse of slopes and embankments) required significant repairs; these were carried out in the second semester of 2009.

Delays in Starting the Institutional Strengthening Program (ISP). JPTD initially concentrated its efforts on the implementation of RGE and made little progress with the ISP during the first year of the project. Subsequently, the scope of issues relating to the various ISP activities were addressed.

Project Cost. The final project cost, US$735.99 million, was 3.6 percent above the PAD estimate. However, there were substantial variations within specific components. The cost of RGE was 14 percent higher than the appraisal cost (US$715 million actual, versus US$627 million at the appraisal), because of: (i) an increase in the price steel and (ii) the devaluation of the dollar vis-à- vis the Renmimbi, from RMB 8.07 per dollar at appraisal to RMB 6.60 per dollar at project completion. The LRIP program was completed at 25 percent of appraisal estimate due to the reduction of scope.

Risk status: The project was not rated as being at risk during implementation.

2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization

The M&E design was appropriate for the project and included relevant outcome and intermediate indicators with baseline targets. In hindsight, the indicators for highway safety presented a problem because of the normal variance from year to year in accident and fatality rates. These indicators were also affected by the timing of the completion of physical and institutional activities. (All outcome indicators were measurable, most of them using data regularly collected by the JPTD, and the rest requiring simple monitoring at low cost.) The impact of road improvement on reducing vehicle operating costs (VOC) was not included as an indicator, because VOCs are obtained by simulation rather than by field measurement. However, vehicle operating costs were estimated separately for economic analysis.

All indicators were monitored during project implementation and reported in the JPTD periodic reports to the Bank. JPTD utilized indicators to assess project progress and to report to keep provincial authorities informed of the results.

2.4 Safeguard and Fiduciary Compliance

Environment. The project was classified as Category A. The Environmental Impact Assessment (EIA) and the Environmental Management Plan (EMP) were reviewed by the Bank at appraisal and found to be satisfactory.

The project implementation adhered to the requirements specified in the EMP and also adopted a number of innovative measures to mitigate environmental impacts (e.g., slope protection and vegetation restoration, farmland protection and creation, ecology education, air pollution prevention, water and land pollution prevention). Issues raised by supervision missions during implementation, such as avoiding dust at work sites, schools and villages during the hot and dry season, ensuring adequate ventilation in tunnels, protecting river banks from erosion caused by temporary structures, were adequately resolved. The environmental protection practice under this project was positively acknowledged by the provincial leaders and has been made the new standard for all future Jiangxi expressway development. More details are presented in Annex 5.

Resettlement. The Resettlement Action Plan (RAP) for the RGE was in line with relevant Chinese laws, regulations and the World Bank Operational Policy 4.12 on Involuntary Resettlement and was adhered to during implementation. Land acquisition and resettlement were carried out without major issues. A special effort was made to reduce the amount of house demolition. Compensation was paid in a timely manner; the total amount paid was higher than anticipated, mainly because more land was reclassified as farmland than originally expected. The table below summarizes RAP implementation. More details are in Annex 5.

Item Actual Percentage of Appraised RAP (%) Land acquisition (hectares) 853.3 102.1 House demolition (square meters) 214,842 78.3 Number of people affected by land acquisition and 7599 97.1 resettlement Total Compensation (US$ million, Cost Table) 30.1 112.1

Extensive post-completion surveys1 showed people affected by resettlement improved their standard of living. Persons affected by structure demolition have been relocated to newly built houses. The average living area per household increased by 17 percent and the percentage of good quality houses (brick and concrete) increased by 38 percent. Entire communities benefited from the project through the improvement of village roads, irrigation systems, power supply and water supply.

1 Center for Involuntary Resettlement Research, Wuhan University. 2009. Resettlement Completion Report, The World Bank Financed Jiangxi No3 Expressway Project.

Resettlement on the LRIP road was small, and was effectively carried out.

Fiduciary. The project had an adequate financial management system in place that ensured that Bank loan proceeds were used for intended purposes. The implementing agency furnished the annual audit reports in a timely manner. All audit reports were unqualified, reviewed and considered acceptable by the Bank.

Procurement. In general, procurement was undertaken in accordance with Bank procurement guidelines; there were, however, some procurement related issues. New contracts awarded by JPTD under LRIP to repair road damages resulting from flooding and landslide and to account for greening works associated with existing subgrade contracts were not eligible for Bank financing, because the Bank had not been informed of these changes and Bank procurement guidelines had not been followed. Award of a contract for construction of an LRIP road did not follow Bank guidelines; the Bank declared misprocurement and cancelled US$5 million of the loan that had been allocated for the road.

2.5 Post-completion Operation/Next Phase

Upon opening to traffic, the operation and maintenance of the RGE was transferred to Ganzhou Administration Division under Jiangxi High Class Highway Administration Bureau. A dedicated Maintenance Management Unit for the RGE Maintenance Center was established in March 2009 and took over maintenance responsibilities in May 2009. This Unit comprises several maintenance teams located near some of the interchanges and has the capacity to properly manage the RGE. Maintenance of the LRIP Chongyi-Fengzhou road is the responsibility of the Ganzhou city prefecture. JPTD is responsible for ensuring that improvements brought about by the project’s institutional development component are sustained and their benefits are extended beyond the initial applications.

3. Assessment of Outcomes

3.1 Relevance of Objectives, Design and Implementation

The relevance of the project objectives remains high, and so is the rationale for Bank assistance laid out at project appraisal. The government of China remains committed to the development of a modern highway system. The National Trunk Highway System, of which RGE is a part, was subsequently incorporated into the larger National Expressway Network (NEN). The NEN is expected to be completed in 2020, when it will connect all provincial capitals and large cities of more than 500,000 inhabitants with cities of more than 200,000 inhabitants.

The project objectives are consistent with the current Bank Country Partnership Strategy (CPS) 2006-2010, particularly in two areas: (i) reducing internal and external barriers to trade; and (ii) reducing poverty, inequality and social exclusion through expanding access to basic social and infrastructure services. China’s 12th Five Year Plan (2011-15) continues to emphasize the importance of a balanced regional development that the 11 FYP highlighted through its emphasis on mitigating social and economic disparities between coastal and inland regions.

The relevance of project design is high. The project components were well selected. The RGE helps to better integrate Jiangxi Province, as well as provinces east and north of Jiangxi, with the rest of China, and with sea ports, thus reducing barriers to trade. The LRIP program benefits one of the poorest prefectures of Jiangxi Province, helping reduce poverty, inequality and social

exclusion. The institutional strengthening program helps to make the management of Jiangxi’s road system safer and more efficient, thus improving the operation of the transport links.

3.2 Achievement of Project Development Objectives

The project development objectives were satisfactorily achieved: (i) the RGE was well constructed and opened to traffic; (ii) while a single road project was implemented under LRIP, a large rural road development program in Ganzhou was undertaken by Jiangxi government, substituting and greatly expanding the aims of the LRIP; and (iii) the institutional strengthening program produced useful recommendations that have largely been put into practice and have made a positive impact, including effecting transport policies.

Outcomes in the Ruijin-Ganzhou corridor

RGE, as a modern expressway, has dramatically improved east-west passenger and freight flows in Jiangxi province. A section of RGE of 9 km has not yet opened, and is expected to become operational by the end of 2011, when the connecting ARE expressway between Ruijin and the Fujian border is completed. At Km 9, the RGE links up with national road G323 through a temporary connection and joins the existing expressway there. A temporary main toll station has been set up near KM 9 to enable the closed toll collection system to work.

Despite the delay in the ARE, the RGE has already greatly improved traffic conditions in its corridor area, by providing a faster and safer to operate facility than the existing G323 national road. When the ARE opens the travel time between Ganzhou and Ruijin will be reduced from 150 minutes on the G323 at appraisal, to 75 minutes. Travel time between Ganzhou and Fujian border has already been greatly reduced. The delay in opening the 9 km of the RGE, will not, however, have any significant negative impact on the project’s outcome, as the delay is short relative to the life of the expressway, and traffic is moving well on a transitory basis through the G323 road.

Traffic safety on the G323 has improved overall, and most of the targets have been met. However, the 2010 values (PDO Indicator 3) show significant difference in accident and fatality rates depending on the G323 section. The large variance in these rates from year to year is likely due to the randomness of major road accidents. Further diversion of G323 traffic to the RGE, upon opening of the ARE, will likely result in a decline in traffic density and corresponding accident rates.

Outcomes in the Local Road Improvement Program

The 48.5 kilometer long Chongyi-Fengzhou road generated greater than expected benefits. Average daily traffic on this road in 2010 was 2,588 vpd in 2010, substantially surpassing the 1,800 vpd target. The number of days the road was closed reduced to zero in 2010 (versus a target of 10 days); and travel time reduced to 50 minutes (versus a target of 60 minutes). The reduction in the number of days closed and the lower travel time has led to a significant improvement in the accessibility for the population and trade logistics for freight. Bus services improved, and the frequency, at 45 buses per day, has exceeded the target of 40.

Due to the LRIP being reduced to only one road after the project was restructured, the overall direct benefits from this program were lower than originally expected. However, the RRPIP launched by the Jiangxi government covers close to 15,000 kilometers of rural roads, and had objectives similar to those of the LRIP. As a result of this program, rural road accessibility in

Jiangxi is vastly greater than at the start of the project. Practically all roads considered during implementation of JPH3 were included in the RRPIP rural roads program, and thus the expected benefits from the improvement of such roads under JHH3 did materialize.

Outcomes of the Institutional Strengthening Program

All the activities of the institutional strengthening program – training, tunnel safety, traffic safety, ETC, and equipment – were carried out and helped improve the management of the road system.

Training. The program comprised 172.4 man-months of training courses (150 domestic and 22.4 overseas) and 33.0 man-months of overseas tours and covered highway management, design and planning, financial management, road maintenance, traffic engineering, resettlement, and environmental protection. JPTD reports that the training program was successful and resulted in a substantial improvement in the technical capacity of the agency. The trained staff played an active role in the implementation of the project.

Tunnel safety. A systematic analysis of tunnel safety in Jiangxi Province was carried out, including a survey of 81 tunnels and statistical analysis of all traffic and accident during 2004- 2008, and the review of international good practices. A Tunnel Safety Management Manual was prepared, which includes recommendations on standards for: (i) visual distance inside tunnels; (ii) control of ventilation, fire-fighting emergency capacity, and tunnel surveillance management; (iii) safety training for engineering personnel, highway management staff, drivers and passengers; and (iv) specific safety standards for very long tunnels. Some of these have been put in practice, and the practice guide is being made the standard for all tunnel operation in the province.

Traffic safety on expressways. The study produced a traffic safety manual, whose recommendations have been applied to RGE, and are being extended to other expressways in the province. JPTD carried out a Stakeholder Seminar on the initial conclusions and recommendations of two studies on tunnel and traffic safety and sought the views of over 40 participants on the recommendations and the research methodology.

Electronic toll collection (ETC). Soon after approval of the project, JPTD launched a program to establish electronic toll collection (ETC) on the province’s expressways. The project’s ETC activity was refocused to support the ongoing work. Bank staff reviewed the design and implementation of the ETC program and offered recommendations, which were adopted in Jiangxi ETC development policy. By completion of the JPH3, more than 100 ETC lanes were established, covering over 3,000 kilometers of expressways. JPTD reports that the ETC has reduced corruption in toll collection and has enhanced traffic efficiency, with its attendant effects on reducing fuel consumption and pollution.

Two grants approved in parallel with, and supporting, JPH3, further helped strengthen the institutional capacity of Jiangxi’s road sector. A grant was financed by the Public Private Infrastructure Advisory Facility (PPIAF) focused on microenterprises for road maintenance projects and resulted in the preparation of a compact disc with road maintenance data from Ganzhou County, and technical and managerial manuals for routine maintenance teams and a guide for implementing team-based routine maintenance. The other grant focused on HIV/AIDS and covered over 20,000 construction workers and villagers, and led to a significant increase in the awareness of HIV/AIDS; reduced stigmatization of attitudes towards HIV-infected people; reduced risky behavior among non-marital relationships; and increased condom use amongst construction personnel by 100 percent. More details on the outcome of the HIV/AIDS grant are in Annex 5.

Equipment. Due to a new Customs policy that eliminated import duty exemptions for internationally-financed goods, the portion of the loan to finance equipment was substantially reduced and the required equipment is being purchased with local funds.

3.3 Efficiency

Project-financed investments (i.e., RGE and the LRIP road) are economically efficient, with an overall economic internal rate of return (EIRR) of 14.4 percent, and an overall net present value (NPV) of RMB 1,528 million. Both values are satisfactory.

The EIRR of RGE is 14.1 percent, close to the appraisal estimate of 14.2 percent. The EIRR of the Chongyi - Fengzhou LRIP road is 32.3 percent, which is much higher than the appraisal estimate (16.3 percent) due to the lower construction costs and higher traffic.

The appraisal financial evaluation of RGE estimated a Financial Internal Rate of Return (FIRR) of 0.8 percent. Due mainly to lower than anticipated toll charges and the higher construction cost, the FIRR at completion is estimated to be 0.3 percent.

The detailed economic and financial analysis is in Annex 3.

3.4 Justification of Overall Outcome Rating

The overall rating of the outcome is satisfactory, based on high relevance of objectives, satisfactory achievement of PDOs, and relatively high efficiency.

3.5 Overarching Themes, Other Outcomes and Impacts

(a) Poverty Impacts, Gender Aspects, and Social Development

The RGE and LRIP components had an impact on poverty alleviation: the RGE alignment traverses several poor counties; the LRIP focused on the Ganzhou, a poor county, through the project-financed road and through Jiangxi government’s Rural Roads Pavement Improvement Program (RRPIP), improved the population’s access to jobs, markets and services. The resettlement process followed during the RGE construction led to a significant improvement in the livelihood of the people resettled, especially better quality and bigger homes, better access to water and to roads, and more orchard farmland.

(b) Institutional Change/Strengthening

The preparation of tunnel and expressway safety manual greatly improved the capacity of JPTD to deal with safety issues in those facilities, and implementation of their recommendations led to improved traffic safety. The introduction of ETC province-wide has been another significant improvement in the management of Jiangxi’s road network. The PPIAF-financed activity on road maintenance by microenterprises has raised awareness of the potential for the use of microenterprises in road maintenance.

More broadly, the training program covered a wide range of highway management subjects has improved the capacity of JPTD staff to adopt more efficient methods in various areas of highway management.

The very successful outcomes of the environmental, resettlement and HIV/AIDS activities under the project went beyond what normally could have been expected from these activities. These have been showcased in international conferences and were very well received.

3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops

Not applicable

4. Assessment of Risk to Development Outcome Rating: Negligible to Low. JPTD is committed and has the capacity to allocate the necessary resources, staff and funding, to ensure that that the physical and institutional improvements resulting from the project remain in place. The sustained growth of the Chinese economy and the corresponding high growth in road transport demand further ensure that there is little risk to the project’s development outcome.

5. Assessment of Bank and Borrower Performance

5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry

Rating: Satisfactory

The Bank performance in ensuring quality at entry was satisfactory. Project design benefited from Bank experience with the preceding JPH2 project that was underway when the preparation of JPH3 started. There was a useful continuity in staffing, as most of the Bank team involved with the JPH3 project had also been involved with the JPH2.

The project design was appropriate. The physical components were anchored in a major expressway of vital importance to Jiangxi province, complemented by a local roads program that focused on a poor county. The institutional strengthening program was simple, with a focus on road safety, a good choice given the fast growing road traffic in China and the high rate of road accidents. Both the physical and the institutional components responded well to road sector issues in Jiangxi Province. The M&E framework was similarly well conceived.

The Bank team placed detailed attention to environmental and social safeguards issues. Bank reviews of the relevant documentation ensured that the documents (EIA, EMP, and RAP) met Bank requirements, including public consultation. The team also ensured that the fiduciary aspects – both financial management and procurement – were properly analyzed and adequate measures were in place for compliance.

Project risks were identified at appraisal as were mitigation measures. Two issues encountered during project implementation could not have been foreseen during project preparation: delay in the construction of the ARE expressway, that delayed by one year the achievement of the full

benefits of the RGE; and Jiangxi’s RRPIP program, which reduced the size of LRIP, was not envisaged at the time of appraisal.

The second issue is Jiangxi’s RRPIP road improvement program, which led to restructuring of the JPH3 to reduce the scope of the LRIP. The PAD notes that the LRIP was part of the five-year highway improvement program of Ganzhou City Prefecture, and there was no information at the time about the Jiangxi-wide RRPIP program.

(b) Quality of Supervision

Rating: Satisfactory

Supervision of the JPH3 consisted, on average, of two missions per year, plus short visits, as required, by specialists residing in Beijing. The supervision team leader, who led the missions for the first half of the implementation period, and most of the other team members, were involved with the project since early project preparation. A new team leader who took over in mid-2008, had already been exposed to the project as member of a supervision mission, and had the advantage of being a Chinese speaker, thus facilitating communications with JPTD counterparts.

The Bank supervision team monitored project implementation closely, and provided detailed recommendations in every aspect of the project, with a view to optimize project outcome. On RGE, missions provided detailed recommendations, especially on safety. On LRIP, the mission devoted considerable time to dealing with the project restructuring and to procurement issues. On the institutional strengthening program, the missions provided detailed comments that resulted in a substantial improvement in the initial orientation, scope and the method of analysis of the various activities. The missions emphasized the need for the studies to produce practical recommendations, and, to this end, recommended the conduct of a stakeholders’ seminar, which was a well attended and highly successful event.

The supervision missions also supported the PPIAF-financed work on microenterprises for road maintenance, helping to identify areas where work should be strengthened.

The satisfactory rating is based on the satisfactory quality at entry and the highly satisfactory quality of supervision.

5.2 Borrower Performance (a) Government Performance Rating: Highly Satisfactory

The central and Jiangxi provincial governments showed a great degree of commitment to the project throughout the preparation to appraisal period. Jiangxi government provided counterpart funding for the RGE as required, allowing this expressway to be implemented without delays and opening ahead of time. Jiangxi government was also instrumental in the support given to environmental protection by providing additional financing and made the World Bank project as standard practice for all future expressway development in the province. Likewise, the government showed great support in the HIV/AIDS program that required the involvement of provincial health authorities.

(b) Implementing Agency or Agencies Performance Rating: Highly Satisfactory

The performance of JPTD was highly satisfactory. Its management and staff were dedicated to the execution of RGE, and their early preparation and bidding process allowed the construction of the RGE to be started in May 2007, just three months after the project loan was declared effective, and to be completed six months ahead of schedule. As a result, the loan was disbursed faster than envisaged at appraisal, which is exceptional in most infrastructure projects.

JPTD responded rapidly and effectively to observations by Bank supervision missions on the construction of RGE. JPTD placed extraordinary attention on environmental concerns, implementation of resettlement, and HIV/AIDS prevention work, leading to outstanding performance in these areas (see Annex 5). JPTD also responded effectively to the supervision missions’ recommendations on institutional strengthening activities.

In comparison, the implementing agency for the LRIP component, the Ganzhou City Prefecture (GCP), was not very consistent in its performance and in one case it did not follow Bank guidelines requiring the Bank to declare misprocurement and cancel that subcomponent. The GCP was also erratic in the submission, and later replacement of candidate roads under the LRIP component. Because of the autonomous nature of the GCP, JPTD had little control power over its decisions. As LRIP accounts for only five percent of the entire loan amount, the poor performance of GCP should not cloud the stellar work of JPTD in implementing the project.

Both Jiangxi government and the main implementing agency – JPTD went beyond their scope to ensure that the highest standards were applied to the project in many aspects, including engineering, environment and social impact mitigation, HIV/AIDS prevention. The only substandard performance was on part of the implementing agency for the small LRIP component.

6. Lessons Learned

The benefits of technical assistance can be enhanced through the conduct of seminars. The well attended seminars, where study objectives and recommendations were presented and discussed by a large number of stakeholders, is likely to have a significant impact; first, by making those responsible for implementing the recommendations get a good understanding of such recommendations; and second, by extending the range of stakeholders, both direct and indirect, who have a clear grasp of the study topics, their importance, and ways to improve performance.

Implementation of rural roads components requires close cooperation between provincial and local government authorities. The problems experienced with the Ganzhou municipality in the design and implementation of the LRIP component suggests that the provincial highway agency does not have enough authority to ensure that the local government will comply with the requirements of the project, especially as regards to procurement. The provincial government would need to be involved, together with the provincial highway agency, to ensure that the local government complies with such requirements.

Highway projects can, during implementation, generate important social benefits, through well designed and implemented social policies. Employment is normally considered the prime benefit

enjoyed by the population in the area during the construction of a highway or other civil works. Experience with the RGE showed that substantial additional benefits can also occur, notably better livelihood resulting from well designed and implemented resettlement and improved health outcomes from the HIV/AIDS focused intervention with construction workers and residents. Achieving such additional benefits requires well designed and implemented social policies.

A signed BOT contract may be an insufficient assurance that the intended works will be carried out. The fact that the contractor for the ARE expressway failed to reach financial closure suggests that a signed contract was insufficient assurance that the ARE would be implemented on time through the negotiated BOT arrangement. When such BOT contracts are linked, but are not part of a Bank project, to the extent possible it would desirable that financial closure is reached in the BOT contract before approval of the Bank project.

PDO indicators shall be selected carefully to provide meaningful feedback on project performance. In various highway projects, one of the PDO indicators is to reduce number of accidents and fatalities over the monitoring period of the projects. However, there are many factors behind the fluctuation of such indicators, and often resulted in difficulties in data interpretation. Some apparent issues include (i) the reliability and accuracy of the data collected, (ii) the statistic bias generated from small samples due to short period, short road sections or little traffic, and (iii) the appropriateness of baseline and target values. Given the importance of highway safety, similar indicators could be used when the above issues can be adequately dealt with, for example, by enhancing information system for collecting and analyzing traffic accident data, and using moving averages instead of yearly monitoring data.

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (a) Borrower/implementing agencies

A summary of the borrower’s implementation completion report is attached in Annex 7. No issues are raised in that report.

(b) Cofinanciers Not applicable

Annex 1. Project Costs and Financing

(a) Project Cost by Component (in USD Million equivalent) Actual/Latest Appraisal Estimate Percentage of Components Estimate (USD (USD millions) Appraisal millions) A. Ruijij-Ganzhou

Expressway -Civil works 455.65 605.01 132.8 -E&M Facilities 17.70 20.06 133.3 -Buildings, traffic facilities, greening 38.18 48.21 126.3 -Construction Sup. (domestic) 11.32 11.64 102.8 -Construction Sup. (foreign) 0.40 0.00 0.0 -Land acquisition and resettlement 26.88 30.14 112.1 Subtotal 550.13 715.06 130.0a/ B. Local Road Improvement

Program -Civil works-Phase I 35.58 13.81 0.39 -Civil works-Phase II 25.00 0.00 0.0 -Construction Sup. (domestic) 0.80 0.51 0.64 -Land acquisition and resettlement 5.28 2.38 0.45 Subtotal 66.60 16.70 0.25 C. Institutional Strengthening -Studies 0.55 0.46 0.84 -Training 1.06 0.76 0.72 -Equipment 8.76 3.44 0.39 Subtotal 10.37 4.62 0.45 Total Baseline Cost 627.16 736.38 117.4 Physical Contingencies 70.06 0.00 0.0 Price Contingencies 13.67 0.00 0.0 Total Project Cost 710.89 736.38 103.6 Front-end Fee 0.50 0.50 100.0 Total 711.39 736.99 103.6 a/ Including contingencies, the estimated PAD cost of the RGE was US$627 million, which would result in 14 percent increase in the actual versus PAD cost, compared to the 30 percent shown in the table when no contingencies are included in the PAD cost.

(b) Financing Appraisal Actual/Latest Type of Estimate Estimate Percentage of Source of Funds Cofinancing (USD (USD Appraisal millions) millions) Borrower 511.39 512 100% International Bank for Reconstruction 200.00 189.7 95% and Development

Annex 2. Outputs by Component

Component Output Comments PHYSICAL COMPONENTS Construction of Ruijin-Ganzhou Expressway (RGE)

RGE Expressway 117.1 km, 4-lane, access- Opened to traffic in April 2009. The controlled expressway first 9 km are not opened to traffic since connection section Ailing-Ruijin expressway still under construction. At Km 9, the RGE connects with national road G323, which crosses the RGE with an overpass, but a temporary connection between both roads has been made. A temporary main toll station has been set up near this location, so that the closed toll collection system can work. The connecting, 31 km Ailing-Ruijin expressway (ARE) is under construction, and expected to be completed in Dec 2011.  interchanges 6 Completed, and all interchanges are operational.  toll stations 6 Completed. One additional, temporary toll station was set up due to the ARE delay.  service areas 2 Completed, all services are operational  maintenance center 1 Completed and operational  surveillance center 1 Completed and operational

Local Road Improvement Program (LRIP)

Chongyi-Fengzhou road 39 km Completed in December 2008. However due major floods in July 2009, some of the road improvements needed to be repaired during 2009. Work consisted of improvement to Class III, 9 meters wide with 6 meters paved. Other LRIP roads See Comments Several other roads originally considered for the LRIP program were carried out with local finance from Jiangxi province. See Sections 2.2 and 3.2 of this ICR.

INSTITUTIONAL COMPONENT Capacity Building Component Output Comments

Training Domestic: 150 man-months Main areas covered included resettlement, environmental protection, financial management, road safety Overseas: Overseas training started in 2009 and completed at the end of 2010 Training 22.4 man-months Study tours: 33.0 man- months Studies

Traffic Safety Operations for Tunnel Safety Operational A tunnel management study is being Tunnels Manual prepared based on the study. Traffic Safety Improvement Study completed Recommendations on roadside safety for Expressways hazard management are already implemented in the RGE expressway Implementation of Electronic More than 100 ETC lanes An additional 100 lanes are expected Toll Collection (ETC) currently in operation in to become ETC-operational by 2012. Jiangxi province expressways

Equipment

Equipment for expressway See Comment At JPTD’s request, this part of the management and project was canceled (except for a maintenance and minor amount). The equipment is environmental monitoring being financed with local funding.

Annex 3. Economic and Financial Analysis

Appraisal Economic Analysis

The economic analysis of the project done at appraisal covered the following two project components: (i) construction of the 117 km Ruijin – Ganzhou Expressway (RGE); and (ii) upgrading of the Chongyi – Fengzhou road (48.5 km) under the first phase of the Local Roads Improvement Program (LRIP)2. Project benefits comprised of savings in vehicle operating costs, travel time savings, and reduction in accident costs. The overall Economic Internal Rate of Return (EIRR) of the project (including RGE and the LRIP road) was estimated at appraisal to be 14.2 percent with a Net Present Value, at 12 percent discount rate, of RMB 1,275 million. They are summarized in the table below:

Appraisal Summary of Economic Evaluation Results EIRR NPV (%) (RMB Million) Ruijin - Ganzhou Expressway 14.2 1,220 Chongyi -Fengzhou Road 16.2 55 Total Project 14.2 1,275

Ex-Post Economic Analysis

The ex-post economic analysis covers RGE construction and the improvement of the Chongyi – Fengzhou local road under the LRIP program, using the same economic evaluation methodology applied at appraisal. The analysis considers that full benefits start to accrue in 2010 for twenty years and uses a 12 percent discount rate. The ex-post economic analysis was done updating the main inputs of the model to reflect current status: (i) actual construction costs; (ii) actual construction cost distribution; (iii) actual traffic; and (iv) revised traffic growth rates.

Ruijin – Ganzhou Expressway

For the economic analysis, RGE was divided into three sections function of terrain, condition and traffic. The table below shows the existing road and new expressway lengths for each section, indicating that on the Ruijin – Yudu and Yudu – Ganxian sections there is positive distance savings, while the Ganxian – Ganzhou section there is negative distance savings. The overall distance savings of the RGE is 16 percent.

2 The Meicun – Longbu LRIP road (34.8 km) was also evaluated at appraisal, but this road was removed from the project; thus it was not include on the ex-post evaluation.

RGE Road Sections Length Length Expressway Length Exiting Road Distance Section (km) (km) Savings (%) Ruijin - Yudu 58.6 72.0 19% Yudu - Ganxian 39.3 50.0 21% Ganxian - Ganzhou 19.1 18.0 -6% Total 117.0 140.0 16%

RGE construction cost estimated at appraisal was RMB 5,060 million; however the actual construction cost increased to RMB 5,220 million, representing a 3 percent increase in construction costs compared with the appraisal estimates. The table below shows the actual construction costs per road section that range from 35.5 to 49.0 Million RMB per km. The actual overall construction cost per km is 44.6 Million RMB per km. The difference in construction costs per km is explained by the terrain type. The Ruijin – Yudu section is on a mountainous terrain, the Yudu – Ganxian sections is on a hilly terrain and the Ganxian – Ganzhou section on a flat terrain.

RGE Road Sections Construction Costs per km Appraisal Estimates Actual Costs Total Cost Cost per km Total Cost Cost per km Difference (Million (Million (Million (Million Section RMB) RMB/km) RMB) RMB/km) (%) Ruijin - Yudu 2,799 47.8 2,887 49.3 3% Yudu - Ganxian 1,354 34.5 1,397 35.5 3% Ganxian - Ganzhou 907 47.5 935 49.0 3% Total 5,060 43.2 5,220 44.6 3%

The appraisal analysis considered a construction period of four years (2006 to 2009), with 20, 30, 30 and 20 percent of expenditures occurring in 2006, 2007, 2008 and 2009 respectively. However, the actual construction expenditures were distributed between 2007 and 2009, with 40 percent of the expenditures accruing in 2007, 50 percent in 2008 and 10 percent in 2009, as shown below:

RGE Road Sections Construction Costs Distribution Appraisal Estimates Actual Costs Construction Percent Construction Percent Year Cost (Million RMB) (%) Cost (Million RMB) (%) 2006 1,012 20% 0 0% 2007 1,518 30% 2,088 40% 2008 1,518 30% 2,610 50% 2009 1,012 20% 522 10% Total 5,060 100% 5,220 100%

RGE was open to traffic in April 2009 and in 2010 it had an Average Annual Daily Traffic (AADT), between 6,993 and 9,229 vehicles per day, however the full traffic potential of the expressway will only materialize when the RGE linkage with the Ruijin-Fujian Expressway (ARE) is completed at the end of 2011. The table below shows the RGE 2010 and 2011 traffic estimated at appraisal, the 2009 and 2010 actual traffic, and the ICR 2011 estimated traffic considering that the linkage to the ARE is completed. In 2011, it is estimated that the actual traffic will be around 16 percent less than the one estimated at appraisal. The reduction in traffic is similar on the Yudu – Ganxian and Ganxian – Ganzhou sections (around 12 percent), but is higher on the Ruijin – Yudu section (20 percent).

RGE Road Sections Traffic Appraisal Estimate Actual 2011 2010 2011 2009 2010 2011 Traffic Traffic Traffic Traffic Traffic* Difference Section (AADT) (AADT) (AADT) (AADT) (AADT) (%) Ruijin - Yudu 10,300 10,897 3,597 6,993 8,741 -20% Yudu - Ganxian 11,700 12,379 3,983 8,699 10,874 -12% Ganxian - Ganzhou 12,600 13,331 4,278 9,229 11,536 -13% Total 11,200 11,850 3,855 7,966 9,958 -16% * ICR estimate

The annual traffic growth projections adopted at appraisal and the ex-post evaluation are given in the table below. On average for all vehicles, the appraisal evaluation considered an annual traffic growth of 7.9 percent from 2005 to 2009, 5.7 percent from 2010 to 2020 and 3.8 percent from 2021 to 2030. However, the actual annual traffic growth rate on the RGE corridor from 2005 to 2009 was 16.6 percent (the GDP in China grew at 11 percent per year during this period). Thus, for the ex-post economic evaluation, the projected average traffic growth rate from 2010 to 2015 was increased from 5.8 to 8.0 percent, considering conservatively that the economic growth on the area of influence of the RGE from 2010 to 2015 will be at least more than around half the economic growth found from 2005 to 2009.

RGE Annual Traffic Growth Rate Period Car Bus & Truck Average Appraisal 2005-2009 8.1 7.5 7.9 2010-2015 6.1 5.2 5.8 2016-2020 6.1 5.2 5.8 2021-2030 4.2 3.2 3.8 ICR 2005-2009 Actual 16.6 2010-2015 8.2 7.7 8.0 2016-2020 6.1 5.2 5.8 2021-2030 4.2 3.2 3.8

The actual 2010 traffic composition on the RGE is given in the table below. The majority of the traffic is composed of passenger cars (66 percent), while buses account for 8 percent of the traffic and trucks for the remainder 26 percent, which is similar to the traffic composition of the actual remaining traffic on the existing road in 2010. In contrast, the traffic composition on the existing road in 2005 was composed of 52, 15, and 33 percent cars, buses and trucks respectively; thus on the RGE corridor, from 2005 to 2010, there has been an increase in the percentage of cars from 52 to 66 percent of the vehicle fleet.

RGE Traffic Composition in 2010 Medium Large Small Medium Large Trailer/ Section Car Bus Bus Truck Truck Truck Container Total Ruijin - Yudu 4,605 193 372 1,221 136 357 109 6,993 Yudu - Ganxian 5,700 246 484 1,513 173 440 143 8,699 Ganxian - Ganzhou 5,962 287 535 1,604 190 470 181 9,229

The table below presents RGE ex-post economic analysis results. They show that the actual EIRR of RGE construction is 14.1 percent, which is similar to the appraisal estimate (14.2 percent). The lower benefits obtained from the lower than expected actual traffic on the expressway in 2011 (16 percent lower than appraisal estimates) and the slightly higher construction costs (3 percent higher than appraisal estimates) were compensated with the higher forecasted traffic growth

between 2010 and 2015. Considering only the actual project costs, the project EIRR would have been 14.1 percent and considering only the actual project costs and the actual traffic in 2011, the project EIRR would have been 13.3 percent. The ex-post total EIRR (14.1 percent) is higher than the economic viability threshold of an EIRR of 12 percent; therefore, the economic justification of the RGE is satisfactory.

RGE Economic Internal Rate of Return (%) Appraisal Ex-Post Section Estimate Result Ruijin - Yudu 13.6 13.4 Yudu - Ganxian 16.5 17.1 Ganxian - Ganzhou 9.9 10.1 Total project 14.2 14.1

The financial evaluation of RGE done at appraisal showed that the expected Financial Internal Rate of Return (FIRR) was 0.8 percent with NPV of RMB -2,626 million at a the financial discount rate of 5.13 percent. These indicators were computed considering toll charges at opening of the expressway of RMB 0.40, 0.80, 1.15 and 1.50 per vehicle-km for small vehicle, medium vehicle, large vehicle and heavy vehicle respectively. The actual toll rates are RMB 0.4 per vehicle-km for small vehicles and RMB 0.8 per vehicle-km for the remainder vehicles. Considering these toll charges, the higher actual construction costs and the actual traffic projections on the expressway, the ex-post FIRR is 0.3 percent with an NPV of RMB -2,173 million.

Chongyi-Fengzhou Road

The table below presents the appraisal estimates and the actual construction costs of the Chongyi - Fengzhou LRIP road, which was improved from Class IV to Class III over a two year construction period. The actual construction costs per km is RMB 2.38 million per km that is 39 percent lower than what estimated at appraisal. The actual 2010 traffic is 2,088 vehicles per day, composed of 73 percent cars, 5 percent buses and 22 percent trucks, which is 42 percent higher than the appraisal estimate (1,466 vehicles per day).

Chongyi - Fengzhou LRIP Road Length Construction Cost Construction Cost Traffic in 2010 (km) (Million RMB) (Million RMB/km) (AADT) Appraisal 48.5 188.3 3.88 1,466 Estimates Actual 38.30 91.2 2.38 2,088 Values Difference -39% 42%

The Chongyi - Fengzhou LRIP road ex-post EIRR is 32.3 percent, which is higher than the appraisal estimate (16.3 percent) due to the lower actual construction costs and higher actual traffic. The ex-post EIRR is much higher than the economic viability threshold of an EIRR of 12 percent; therefore, the economic justification of the LRIP road is high.

Chongyi - Fengzhou LRIP Road EIRR (%) Appraisal Ex-Post Section Estimate Result Chongyi - Fengzhou 16.2 32.3

Overall Economic Analysis

The overall ex-post EIRR of the project, including the RGE construction and the LRIP road, is 14.4 percent and the overall NPV is RMB 1,528 million, which is satisfactory considering the economic viability threshold of an EIRR of 12 percent.

Annex 4. Bank Lending and Implementation Support/Supervision Processes

(a) Task Team members Responsibility/ Names Title Unit Specialty Lending Administrative Rose Abena Ampadu Program Assistant AFCW1 Support Christopher R. Bennett Sr. Transport Specialist EASNS Task Team Leader Highway Jean-Marie Braun Consultant ECSS5 Engineering Transport Robin C. Carruthers Consultant AFTTR Economics Boping Gao Consultant EASIN Transport Engineer Transport Imogene B. Jensen Sector Leader EASIN Engineering Transport Henry G. R. Kerali Sector Manager ECSS5 Engineering Transport Alberto F. Nogales Consultant AFTSN Engineering Anil H. Somani Consultant EASNS Environment Hongkun Yang Consultant EASCS Procurement EASTE - Economic/Financial Han-Kang Yen Research Analyst HIS Analysis Resettlement Youlan Zou Consultant EASCS Specialist

Supervision/ICR Former Task Team Christopher R. Bennett Sr. Transport Specialist EASNS Leader Highway Jean-Marie Braun Consultant ECSS5 Engineering Wenling Chen Consultant AFTTR Technical Support Task Team Fei Deng Sr. Transport Specialist EASIN Leader/Engineering /Institutional Emily Dubin Junior Professional Associate EASIN Technical Support Yiren Feng Environmental Specialist EASCS Environment Sr. Financial Management Financial Yi Geng EAPFM Specialist Management Administrative Maria Luisa Juico Program Assistant EASIN Support Hernan Levy Consultant EASIN ICR preparation Senior Social Development Social Zhefu Liu EASCS Specialist Development Anil H. Somani Consultant EASNS Environment

Haiyan Wang Senior Finance Officer CTRDM Disbursement Hongkun Yang Consultant EASCS Procurement Dawei Yang Consultant EASTS Procurement Xiaoke Zhai Transport Specialist EASCS Highway Engineer Financial Qi Zhu Consultant EAPFM Management

(b) Staff Time and Cost Staff Time and Cost (Bank Budget Only) Stage of Project Cycle USD Thousands (including No. of staff weeks travel and consultant costs) Lending FY05 13.4 89.4 FY06 33.5 236.7

Total: 46.9 326.1 Supervision/ICR FY07 10.3 87.8 FY08 8.7 61.9

FY09 9.1 79.5 FY10 8.5 47.1 Total: 36.6 276.3

Annex 5. Environmental and Social Mitigation and Impact3

This Annex covers three topics: Environment, Resettlement and HIV/AIDS.

Environment

The preparation of Environmental Impact Assessment (EIA) Report and Environmental Management Plan (EMP) for the RGE started in December 2004 and the final version of the EMP completed in January 2006.

With 57 villages/townships and nine schools located along the project route, the JPTD made significant efforts to reduce the negative environmental impact of the project. This was achieved during implementation and damage to the surrounding communities was reduced to a minimum.

The following are examples of some of the most successful measures.

Slope Protection and Vegetation Restoration. Slope protection and vegetation restoration were paid special attention due to the special geological situation of the project. The RGE passes through mountainous areas, therefore some high-cut slopes were inevitable in its alignment. The consequent loss of vegetation combined with high volume rainfall during summer made it likely that serious landslides could happen creating dangerous conditions for the route. Hence, it was necessary to stabilize newly formed slopes and borrow pits with sound engineering measures, and rehabilitate these ecologically weak areas with vegetation, e.g. grass, trees, shrubs, and bushes. In order to find out the optimal cover, the JPTD created test beds on slopes to test the impact of various kinds of vegetation, and selected the most suitable ones for the local climate and condition. For vegetation restoration, spreading a large amount of grass seeds on uncovered ground was found to be an efficient approach. Plastic cloth was used to temporarily cover the ground to prevent soil erosion if the vegetation was not fully restored by the wet season. The JPTD provided additional financial support to the project to cover the extra cost.

Farmland Protection. To protect farmland in the vicinity of the expressway, the excavation of borrow pits and disposal of construction waste was closely monitored throughout the construction process. Wherever borrow pits were necessary and unavoidable to dig, ecological restoration was followed up promptly. Also, when excavating the acquired cultivated land, a 30 cm deep layer of topsoil was retained for use in reclaiming and rehabilitating cultivated land areas. In addition to the above protection activities, the JPTD also provided funding support to redevelop farmland wherever feasible. The land was then transferred free of charge to the affected villagers along the

3 This annex is based on the following sources (i) Deng, Fei and Wang, Peng, 2009. World Bank Financed Jiangxi Expressway IIIProject – Successful Experience in Environmental and Social Impact Mitigation. World Bank, East Asia and Pacific Region, Sustainable Development Department. (ii) Wuhan University, Center for Involuntary Resettlement Research, 2009. Resettlement Completion Report, The World Bank Financed Jiangxi 3 Expressway project. (iii) Chen Chong, 2009. Report on Progress Review of HIV/AIDS Education Program Under Jiangxi Highway Project III

expressway. Upon completion of the project, the redeveloped farmland had reached 150 mu (10 ha).

Slope Protection Vegetation Restoration Newly Reclaimed Land Formed by Earth Filling

Educational Campaign. Educational campaigns focusing on ecological preservation were carried out for a target audience including the project management team, construction workers, and other relevant project stakeholders. The purpose of these campaigns was to increase the people’s awareness for ecological protection and to encourage them to comply with the requirements for environmental impact mitigation. Specially designed publicity posters and other educational materials were widely distributed and posted at clearly visible locations across construction sites and worker camps.

Air Pollution Prevention. To prevent construction dust from polluting the air of the surrounding communities, the project required that all construction sites, concrete mixing plants, and materials storage yards were kept at least 300 meters away from major residences, hospitals and schools, where children, senior people, and patients reside. All construction material storage sites were equipped with sprinkler systems to prevent flying dust.

Water and Land Pollution Prevention. Discharge of sanitary sewage from 12 construction camps, as well as surface runoff from bridge construction, storage areas, mixing plants, were likely to significantly pollute water streams. During project implementation, differentiated wastewater treatment standard levels and techniques were applied to different water sources. Discharging untreated wastewater directly into rivers or reservoirs was strictly prohibited and subject to fine. At bridge construction sites, where water pollution was often identified as a problem due to lack of sufficient protection, temporary dams were built on the river to prevent construction wastewater flowing into the water. On the river banks, construction materials were kept more than 100 meters away from water. In addition, temporary separation walls were built to separate road building materials from nearby farmland to avoid land contamination. Plastic cloth was widely used to cover the embankments.

Temporary dam dividing waste Clean river near bridge Plastic film covered embankment water and river construction Site

Institutional Strengthening and Capacity Development. A series of training courses on environmental protection were provided to project management personnel to strengthen their capacity in environmental protection and impact mitigation. In February 2007, the Project Office offered training to the environmental and engineering staff from the Project Office, General Supervision Engineer’s office, Resident Engineer’s office, and the Contractor’s office. Around 70 people attended the training. The results proved to be fruitful – the project team’s awareness was raised, good practices were shared, and their environmental protection technical expertise was strengthened.

Feedback from the Project Stakeholders. Surveys were conducted of the following three groups: project contractors, construction workers, and affected communities. The purpose was to understand the stakeholder groups’ attitudes towards the aforementioned environmental protection measures and to evaluate the effectiveness of these efforts. The feedback from the stakeholders is summarized in the following table:

Stakeholders’ Reponses on Environmental Protection Measures Stakeholder Type Responses 1. Project Contractors The environmental protection measures were necessary and effective. After training, they had taken on a variety of protection measures on their construction sites. 2. Construction Workers Workers encountered one or more problems during the road construction, such as noise, flying dust, tunnel air pollution, etc. Workers adopted protective measures, which they believed were “effective” or “largely effective”. 3. Affected Communities The survey results indicated that (1) the affected communities acknowledge the project team’s efforts to minimize negative environmental impacts to acceptable level (2) all the villagers interviewed rated the environmental protection “satisfied” or “largely satisfied”.

Resettlement and Livelihood Rehabilitation

The data and analysis in this Annex is based on the Resettlement Implementation Report prepared by the Center for Involuntary Resettlement Research, Wuhan University in August, 2009. This center acted as the Resettlement Independent Monitoring Organization.

Land acquisition and resettlement for the construction of the RGE was carried out in accordance with the Resettlement Action Plan (RAP). Key indicators of the resettlement, comparing RAP estimates with actual values are shown in the table below:

Item Actual RAP Actual/RAP (%) Land acquisition (hectares) 853.3 835.7 102.1 Farmland included (hectares) 348.6 303.7 114.8 House demolition (square meters) 214,842 274,370 78.3 Number of villages affected by land acquisition 66 63 104.8 Number of people affected by land acquisition and 7599 7826 97.1 resettlement Number of households affected by land acquisition and 1652 1714 96.4 resettlement Total Compensation (US$ million, Cost Table) 30.14 26.88 112.1

Estimated and actual resettlement impacts. Overall, there were little differences between the RAP and the actual values. The most significant discrepancies occurred for: (a) farmland, where actual farmland taken over by the resettlement process was about 15 percent higher than expected, although overall land acquisition was close to the original RAP estimate. The differences regarding farmland stem from changes in the classification of the various types of land, the actual values classifying some lands originally taken as dry and forest lands as farmland, mainly because some of the forest lands are used for planting of fruit trees (see table below), (b) house demolition, which was 21.7 percent less than expected in the RAP, was reduced thanks to a number of actions taken during resettlement, such as the elimination of a parking area in Maodian town and the redesign of the Yudu service area, to minimize house demolition, and (c) compensation, which turned out to be higher than expected, mainly as a result of the reclassification of more land as farmland.

Item Unit Actual amount Survey amount in the Resettlement Action Plan Actual to plan % (I) Land acquisition Paddy field mu 3824.55 3135.13 122.0 Dry land mu 554.38 799.60 69.3 Fruit garden mu 850.55 377.80 225.1 Pond mu 337.93 208.94 161.8 Forest land mu 6125.62 6903.65 88.7 Wasteland, hill and mu 834.79 1110.30 75.2 slope and other lands Subtotal mu 12799.30 12535.42 102.1 Source: Resettlement Implementation Report

Conservation of Land Resource. Resettlement has long been recognized as a major challenge for infrastructure development projects in China, where a mixture of political and socio-economic factors have made the issue complicated and burdensome. The situation is particularly difficult for projects located in high population density mountainous areas where rural residents heavily rely on limited land for their livelihood. The Jiangxi Expressway project is a typical example, where a significant portion of land would be affected by construction of the RGE expressway.

Public Participation. Wide and successful public participation is essential for the success of the resettlement work. The resettlement team planned ahead. At the beginning of the resettlement period, printed brochures introducing the government and World Bank’s resettlement policies were widely distributed to affected household to ensure each affected individual was aware of the resettlement policies, procedures, and individual household’s own rights. In addition to the booklets, resettlement policies and other relevant information were also printed on posters and placed on each village’s information wall. Resettlement office’s contact information was made available for public supervision and monitoring. To encourage public involvement, town hall style meetings were organized to allow villagers from affected areas to express their own ideas directly to the resettlement management team.

The final RAP, prepared by the resettlement team, was based on the villagers’ opinions and suggestions. Among the discussed topics, the central one was resettlement compensation, including land compensation and labor force resettlement allowance. During the consultation

process, some innovative compensation methods were suggested by the villagers and adopted in the RAP. For instance, the resettlement mode could be chosen by the villagers, with the options consisting of either clustered resettlement, i.e. living in a condensed community with other neighbors, or scattered mode, depending on each particular situation. The compensation payment for land and labor force resettlement allowance was also presented with options. In some places, the land compensation fund was directly disbursed to the farmers whose land was requisitioned, whereas in other places, partial fund was used for public purpose production and re-development.

Dongtian Village, Maodian Town, Gan County are representative of the resettlement options. A family electing to find a new housing site outside the clustered resettlement area by itself, would receive an allowance of RMB 3,600 (US$528). In the case of a family electing a clustered resettlement, the housing site would be determined according to the plan and through negotiation. In cases where a dispute emerged over the location of the housing site, a lottery was used to ensure fairness. The land for house rebuilding was provided to individual households without additional charge. (photo to left: Newly-built Concentrated Resettlement Area of Maoping Village, Luo’ao Town, Yudu County).

Addressing Grievances. Clear procedures were established to ensure that all complaints would be resolved in a professional and efficient manner. Frequently encountered complaints were categorized and guidelines for response were provided to officers who were expected to handle these issues. Approximately 200 complaints were received and handled during the resettlement stage of the project and no intractable conflicts arose during the entire project cycle.

Compensation Disbursement. Resettlement compensation was paid directly to the displaced families through individual accounts from local commercial banks. The resettlement office, cooperating with postal saving banks, directly deposited the compensation funds into their special accounts according to the ID cards of affected individuals. Beyond that, resettlement offices at all levels ensured that resettlement funds under special accounts should not be used to repay recipient’s personal debt.

Non-Cash Benefits. In addition to cash compensation payments, local communities were also eligible to share other non monetary benefits from the project, such as the improvement of a drinking water facility and rural road upgrading. Based on the resettlement plan, 3,000 mu (200 ha) of land were re-developed as orchard land and another 2,000 mu (133 ha) of land were modified into orchard land.

Qiantang Primary School before and after relocation As shown in the table below, after resettlement, the land area for most affected households increased. Household Land Area Increase After Before resettlement relocation Rate of Indexes (m2) (m2) increase Gan County Average area 223.08 183.89 21.31 Minimum area 90 40 125 Maximum area 540 540 0 Huichang County Average area 240.94 214.69 12.23 Minimum area 70 34 105.88 Maximum area 600 600 0 Ruijin City Average area 219.84 169.26 29.88 Minimum area 75 40 87.5 Maximum area 385 390 -1.28 Yudu County Average area 301.42 281.5 7.08 Minimum area 110 30 266.67 Maximum area 780 1600 -51.25 Zhanggong District Average area 251.9 197.41 27.61 Minimum area 50 40 25 Maximum area 600 600 0 Total Average area 258.84 221.65 16.78 Minimum area 50 30 66.67 Maximum area 780 1600 -51.25

Housing structure also improved. Earth-wood housing structure used to be a major structure type for the region, and has been reduced to a low percentile after resettlement. Brick-concrete became the dominant structure type.

There was also improvement in the rural infrastructure facilities:

Before resettlement After resettlement I. Accessibility of towns Rather convenient 45.7 66.5 Average 36.2 24.3 Inconvenient 18.1 8.9 II. Source of drinking water Tap water 12.6 31.5 Spring water 1.5 1.2 Well water 77.8 63.5 River and pond 8.1 3.9 III. Roads in village Driveway 65.2 83.7 Simple footpath 29.3 14.6 No road 5.6 1.7 IV. Power supply Guaranteed 45.7 66.5 Not guaranteed 36.2 24.3 No power 18.1 8.9

A survey made by the resettlement office shows that the satisfaction rate among the relocated households are very high, with most respondents rating the resettlement outcome between “Very satisfied” and “Average”. In most counties, “Very dissatisfied” rating was rarely seen.

Ratings of Land Acquisition and Resettlement Results by Relocated Households

Very Very satisfied Satisfied Average Dissatisfied dissatisfied Total Dongtian 25 25 25 25 0 100 Hongxing 7.1 57.1 21.4 14.3 0 100 Huangsha 7.1 57.1 14.3 21.4 0 100 Huangtian 20.7 24.1 41.4 6.9 6.9 100 Luobian 7.7 69.2 23.1 0 0 100 Maoping 31.2 37.5 31.2 0 0 100 Qiangong 33.3 42.9 14.3 9.5 0 100 Sanmen 12.5 37.5 37.5 0 12.5 100 Shanbei 0 60.9 26.1 8.7 4.3 100 Shuiduan 15.4 23.1 38.5 0 23.1 100 Taiyangping 0 70 20 10 0 100 Tianxin 10 40 10 40 0 100 Yanba 0 76.9 15.4 7.7 0 100 Beixia 0 87.5 12.5 0 0 100 General 13 50 24.5 9.1 3.4 100

HIV/AIDS Awareness Raising and Behavior Change

Overview. The Jiangxi Expressway III Project, included a project component designed to reduce HIV transmission among construction personnel and local villagers by conducting AIDS publicity and educational activities during the period when the construction was being undertaken. With a grant of US$80,000 provided by the World Bank, the HIV/AIDS component covered a range of activities implemented by the Jiangxi Provincial Center for Disease Control (JPCDC).

The HIV/AIDS Education Program started in April 2007 and ended in August 2009. The program was divided into two phases, with Phase I ranging from April 2007 to January 2008, when the sub-grade of the REGE was being built, and Phase II from February 2008 to September 2009, when the pavement was being placed. An estimated 21,500 construction staff (including all such staff) and villagers were covered during the program’s two phases.

Program Investigation and Interviews. Before the program was formally launched, the implementation team carried out two provincial level program investigation and on site study tours. During this time, health professionals from JCDC interviewed a sample of construction staff and villagers as sample group to get the basic information and obtain baseline data for further intervention.

Training. Eight meetings and training sessions were held and around 400 persons took training courses on HIV/AIDS topics. Training participants included managerial staff of the Jiangxi Highway III Project, as well as grass-roots health care personnel working directly with the construction workers at the construction sites. After this training was completed, more widely- reaching public lectures on HIV/AIDS were given to a wider audience so that more people could be reached out. Peer education was also a key method used by the program team to reach out more construction personnel.

Posters and Publicity Materials. In addition to face-to-face training and lecturing, publicity materials were also prepared and printed on various media including posters, booklets, and play- cards, on which JCDC introduced the basics of HIV/AIDS infection channels and prevention measures. Information about HIV voluntary consulting and testing (VCT) was also provided on these printed materials so that more participants would be aware of the availability and convenience of VCT. Testing was offered onsite.

Provision of Free Condoms. A key program intervention focused on changing people’s unsafe sex behavior by encouraging condom usage. This was heavily promoted by the JCDC as a fundamental prevention measure to lower the HIV infection rate. At construction sites and nearby villages, free condoms were delivered to the target population together with educational materials.

Entertainment Shows and Gift-awarding Q&A sessions. In order to encourage public involvement, innovative ideas were adopted to market the HIV/AIDS campaign and make it more effective. For instance, variety shows and entertainment programs, conceived in partnership between the JPTD, JPCDC, and the People’s Broadcasting Station of Jiangxi Province (PBSJ), were utilized to spread messages on safe sex and the transmission of AIDS and other STDs. On December 29 and 30, 2008, two variety shows were presented for construction workers and project affected residents. Some 500 persons attended, including men, women, adolescents, and children.

Outputs. A summary of the program interventions is in the table below.

Output Construction For Intervention Activities personnel Residents Total Posters stick on walls 2600 1654 4254 Number of Condoms delivered 71781 36080 107861 Picture booklets 66382 66229 132611 Play cards 4825 4361 9186 VCDs 3151 1984 5135 Eco shopping bags 460 0 4 Folding fans 35 0 35 Dissemination of various publicity Cups 3610 4135 7745 materials Calendars 283 0 283 Number of lectures 164 122 286 Lectures on HIV/AIDS knowledge Number of participants 5702 3976 9678 Number of Consultation 3868 3183 7051 Number of Consultation HIV VCT and tests 2104 254 2358 Entertainment shows Number of attendees about 700 about 700 Activities of peer Number of peer education educators 72 15 87

Results. The evidence indicates that the awareness rate of HIV/AIDS knowledge among the target groups has been significantly increased, stigmatization attitudes towards HIV-affected people have decreased, and high risk behavior among non-marital relationships was dramatically reduced. Differences in values before and after intervention were statistically significant for all variables shown in the table. One of the most striking results was the increase in the rate of condom usage by more than 100 percent.

Item Key Indicators Improvement after intervention (%) Construction Construction Residents Personnel Ph. 1 Personnel Ph 2. AIDS awareness transmission knowledge 41 58 29 average knowledge 18 45 18 STDs awareness average knowledge 13 33 23 discrimination and unwilling to affiliate with 36 70 34 stigma HIV(+) (percentage reduction) HIV(+) shall not attend school 12 57 36

(percentage reduction) using condom when having sex 22 15 8 Sexual behavior with non-marital partner in the last three months using condom when having sex 72 24 49 with non-marital partner in the last time

Conclusion

The Jiangxi Expressway III Project is a representative case which demonstrates the success of a World Bank-financed highway project in simultaneously achieving positive environmental and social impacts. From the Bank’s perspective, the success gained can be largely attributed to comprehensive planning in the project preparation stage, strong support from the leaders of Jiangxi provincial government, unyielding commitment of the implementation team, and effective cooperation among various stakeholders during project implementation. Despite many challenges and practical problems encountered during the process, the project has benefited from the adoption of local knowledge and innovation. All these factors combined have made the Jiangxi Expressway III an exemplary project.

Annex 6. Stakeholder Workshop Report and Results (if any) Not applicable

Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR

1. Project Overview

Project Objectives The Objectives of Third Jiangxi Highway Project are as follows: Ganzhou to Ruijin Corridor: i) Increased average daily traffic；ii) Decreased accidents on the existing road G323；iii）Decreased travel time;

Local Road Improvement Program (LRIP): i) Increased average daily traffic volume；ii) Reduced number of days closed；iii）Reduced travel time；iv）Increased daily bus service； and Implementation of key recommendations from the institutional strengthening components.

Brief Introduction of the Project RGE is the important section of Xiamen to Chengdu Expressway in Jiangxi Province under National Expressway Network, is also one of arterial expressway network in Jiangxi Province. RGE is 117.12km in total length with a total estimate of RMB5.62 billion Yuan and an approved construction period of 3 years.

RGE starts at Bixia Village, Yunshi Township of Ruijin City, connects the end point of Ailing to Ruijin Expressway (under construction), via Ruijin City, Huichang County, Yudu County, Gan County, Zhanggong District and Ganzhou City Economic & Technological Development Zone, the end point of RGE connects the completed expressway in western Ganzhou City which is also one section of Xiamen to Chengdu Expressway.

RGE is designed with expressway standard, i.e. dual-way four lanes, 26m wide subgrade and designed driving speed of 100km/h. the main woks quantities are: subgrade stone & earth works of 23.37 million cubic meters; 19570m/96 bridges, of which Gongjiang Exceptional Large Bridge at Bai’e Town of Huichang County is the longest one with a total length of 1413m, the tallest bridge is Jiuling Viaduct in Huichang County with the tallest pier of 75m, long-span variant section continuous rigid system was firstly adopted for the bridge; 8873m/5 tunnels, among which Zhonggong Tunnel is 4185m in length; protection works of 210933 m3; drainage works of 180741m3. Asphalt concrete pavement of 266.4km2；130 culverts; 257 passages; 6 interchanges; 6 toll stations; 2 service areas; 1 maintenance center; 1 surveillance center.

Project Cost and Finance The project estimated cost had been modified, the World Bank loan disbursement ratio is varied according to the different categories of the project ranging from 25% -100%, the total World Bank loan for the Project is USD200 million. The domestic funds are from Ministry of Transportation and Jiangxi Province.

Project Organization JPTD undertook the Project, and established an implementing agency for the Project. The Implementing Agency is headed by Mr. Wu Kehai and staffed with 4 deputy directors. Under the Implementing Agency are the divisions of Engineering, Contract Management, Finance, Administration, Inspection, Foreign Liaison and Land Acquisition & Resettlement Office.

2. Project Implementation RGE Supervision service for RGE was divided into 6 contracts and procured through NCB, the supervision scope was the corresponding subgrade, pavement, bridges & culverts, intersections, tunnel, environmental protection, protection works, safety facility during construction preparation stage, construction stage and defect liability period, and the supervision companies should do works taking-over and completion & acceptance together with the Implementing Agency. The successful supervision contractors were mobilized to the construction sites in January 2007.

Supervision service for E&M works and buildings of RGE was divided into 2 contracts and procured through NCB, the supervision scope was the corresponding E&M works or buildings and its accidental facilities during construction preparation stage, construction stage and defect liability period, and the supervision companies should do works taking-over and completion & acceptance together with the Implementing Agency. The successful supervision contractors were mobilized to the construction sites in May 2008. Civil works of RGE was divided into 16 subgrade contracts and 4 pavement works and procured through ICB; 8 greening works contracts, 2 E&M works contracts, 9 building contracts and 4 traffic facility contracts were procured through NCB. Commencement opening news conference was held by Jiangxi Government in Nanchang City on February 8, 2007, RGE was completed, opened to the traffic and started a trial operation on February 8, 2009. RGE is the only World Bank financed expressway in China which has not used foreign supervision service; and the World Bank recognizes hard efforts in the field of the civilized construction, environmental protection, quality control, resettlement and etc. by taking advantage of domestic engineers and contractors.

JPTD entrusted Jiangxi Provincial E&M Equipment Bidding Co., Ltd. to procure the equipments for maintenance of RGE through NCB. At present, the procured equipments have been basically in place and can meet the needs of RGE maintenance management.

Local Road Improvement Program (LRIP)

The World Bank mission and local government preliminarily selected Chongyi to Fengzhou road and Meilin to Longbu road from many optional roads in September 2005 as the LRIP. The implementation of Meilin to Longbu road was delayed again and again due to the lack of counterpart funds, then after the communication between the World Bank mission and the local government, the Chongyi to Longgou road was replaced by the Anyuan to Dingnan road in March 2008, but the implementation of the Anyuan to Dingnanan road had not been done on schedule due to the lack of counterpart funds. After the communication between the local government and the World Bank mission again, Anyuan to Dingnan road was replaced by the Chongyi to Longgou road in September 2008. The implementation of Chongyi to Longgou Road was failed due to the infringement of Loan Agreement and Project Agreement by Chongyi County Government, because the local government commenced the construction of the road without approval on the procurement of civil works from World Bank and was declared misprocurement, so the World Bank loan allocated for the road was cancelled.

So, LRIP only includes Chongyi to Fengzhou Road. The construction of Chongyi to Fengzhou Road was commenced in July 2006, 1 construction supervision contract, 3 subgrade contracts, 1 pavement contract, 1 traffic safety facility contract and 3 greening works contracts were procured through NCB. After two years and half, Chongyi to Fengzhou Road was completed and opened to the traffic in December 2008.

Environmental Protection and Resettlement Environmental protection was properly conducted in the whole process of construction of RGE. According to Supervision Implementation Plan for Environmental Protection, there are requirements of “no soil erosion during construction, no soil exposure after completion of works” and guideline of “protecting slope bottom, draining and building dam when finishing the slope” to regulate the discharging of slurry, side slope protection and control of disposal & earth-borrow site. Cofferdam method and sediment tank was adopted for bridges of RGE to prevent polluting the river during the construction of bridge foundation; broadcasting the grass seeds on the slope surface, using ecological membrane and stacking earth-filled bags on the slope toe and etc to prevent cut slope and embankment from the soil erosion. When the works was completed, temporary land, construction sites, living camps had been cleaned and restored completely before demobilization.

Protection and greening works for the cut slopes was designed and optimized step by step, the slopes were rounded in order to keep in harmony with the natural hills nearby, ecological protection is adopted as much as possible and much attention is paid to planting local trees, grass and bushes. Greening on side slopes of the sandy rock is very difficult, new techniques such as grass seed bags on the ruts of side slope, geotechnical latticework, anchor bolt strengthening and grass-seed broadcasting on borrowed soil are adopted and the World Bank mission praised it each time the mission came to Jiangxi Province.

Resettlement

Internal Monitoring and Independent Monitoring were conducted for the preparation and implementation of RGE’s resettlement. The major events of RGE’s resettlement activities are: May to June 2005 saw the completion of land acquisition & house relocation and social economic survey, and RGE Resettlement Action Plan was prepared based on the survey; the World Bank conducted official appraisal on Third Jiangxi Highway Project in April 2006; RGE’s resettlement mobilization meeting was held on August 16, 2006 in Ganzhou City, symbolizing the formal launch of RGE’s resettlement activities. Based on the resettlement preparation, Provincial Resettlement Office (PRO) disbursed the first funds for land acquisition and house relocation, symbolizing the formal beginning of resettlement implementation. Consultation on land acquisition for JP3 was finished in end December 2006, the house relocation was ongoing. More than 90% houses to be relocated had been demolished, and then the house rebuilding was the focus. Land Acquisition Contracts were signed between Project Office and all Counties (Cities) Governments along the RGE in end June 2007; by the end of December 2007 house relocation had basically been completed, and land compensation funds had been disbursed basically, and among 747 households who had to relocate their houses, 606 households had had their house rebuilt, 142 households were rebuilding their houses, and 1 household had not rebuilt its house; up to the end of January 2009, three remaining un-relocated houses in end 2007 had be relocated timely through reaching compensation agreement. March 2009 saw the completion and opening to the traffic of RGE ahead of schedule.

The differences between the actual quantities and those in RAP dated in 2005 are shown below.

Comparison between the actual quantities and those in RAP

items unit Actual quantity Quanityt in RAP Difference I. Land acquired Paddy field Mu 3824.55 3135.13 689.42 Dry land Mu 554.38 799.60 -245.23 Orchard Mu 850.55 377.80 472.75 Pond Mu 337.93 208.94 128.99 Forest land Mu 6125.62 6903.65 -778.03 Waste land and other land Mu 834.79 1110.30 -275.51 Subtotal Mu 12799.30 12535.42 263.88 II. houses relocated Brick and concrete bungalow M2 77001.24 104255.94 -27254.70 2 Brick & tile house M 16712.69 28208.48 -11495.79 2 Earth & wood house M 99814.90 115036.60 -15221.70 2 Simple house M 21313.52 26869.07 -5555.55 2 subtotal M 214842.35 274370.09 -59527.74 III. things attached to the land 2 Levelled ground M 37308.52 39302.80 -1994.28 2 Ground for basking grain M 24215.24 10538.55 13676.69 well unit 606.00 605.00 1.00 tomb unit 9671.00 2231.00 7440.00 Marsh gas tank unit 120.00 48.00 72.00 Wall fence m 6416.57 3244.70 3171.87

From the above table, it is learned that additional land was acquired, and the area of the relocated houses was reduced, and the quantities of structures attached to the land varied. As a whole, except for the area of the houses, the quantities of the other affected physical things varied little.

The reduction in the quantity of relocated houses helped reduce the impact on local people. The differences between the quantity during the socioeconomic survey and the actual quantity are due to the followings main reasons:

 Through the wide disclosure of the information on the project, the affected population knew much about the Project, and they actively participated in the careful check and confirmation of the affected physical things during the course of laying out the red line, so the quantity of the affected physical things was more accurate, while during the construction, more physical things attached to the land (such as tombs and underground facilities) were found, thus the quantity of affected physical things attached to the land in some places was increased.

 During the preliminary resettlement survey, the quantity of land of all kinds to be acquired were recorded according to the current situation, while these information was checked based on the principle of “on the basis of current situation, take a reference to its history”. Thus the original paddy field was changed to the dry land, and the original orchard was changed to the dry land and forest land, in order to be in favor of farmers’ benefit, they were compensated according to the original land kinds. So the quantities of acquired

paddy field and orchard were increased while the quantities of dry land and forest land were decreased greatly. This change indicated that the Resettlement Office paid much attention to the opinions of the affected persons and protected the benefits of the affected persons.

Institutional Strengthening

Traffic safety operation for tunnels. 81 tunnels in total in Jiangxi Province were surveyed for the study, especially the detailed field survey on the Heshi Tunnel and Jiulingshan Tunnel of Wulin to Ji’an Expressway and the Yanggongshan Tunnel of Taihe to Ganzhou Expressway was carried out, basic information, traffic volume and traffic accident data of all tunnels in Jiangxi Province from 2004 to 2008 were collected. Integrating the highway tunnel operation safety evaluation and management system theory and management experience, the Study Team carried out systematic analysis and study on the current situation of highway tunnel operation safety evaluation and the existing problem in Jiangxi Province, and discussed the division of the highway tunnel safety class, and tunnel safety evaluation methodology corresponding to the different highway tunnel safety class and its application.

Aiming at the existing problem of tunnel management in Jiangxi Province, the Study provided the technological improvement measures and policy recommendations for the government, such as (i) providing good visual condition inside the tunnel;（ii）strengthening the control of ventilation, enhancing the fire-fighting emergency capacity, improving the tunnel surveillance management;（iii）strengthening the safety education for the designers, managerial staff, drivers and passengers; and（iv）the government should prepare the safety facility standards for the construction of the long expressway tunnel. In addition, the study also discussed the highway tunnel safety evaluation, the development and application of information management software, and prepared the Expressway Tunnel Operational Safety Management Manual for the long tunnel.

Roadside safety. A study on the expressway roadside safety and countermeasures was carried out and supported by the World Bank technically and financially. Field survey was conducted for the existing expressways, its roadside safety facilities and black spots of roadside-prone traffic accident in Jiangxi Province and collected the roadside-related traffic accident data of three expressways situated on the different landforms in 2006 and 2007, then the detailed analysis on the traffic accident characters, traffic accident data and its causes by means of adopting the traffic safety theory and mathematical statistic technology.

The case study discussed the classification method of expressway roadside safety level and its application, and the effectively protective measures were finalized according to the safety risks possibly caused by the inadequate roadside safety facility design, such as : (i) for the section with adequate roadside clear zone, slab-covered ditches or shallow ditches are available instead of former traditional ditches in order to increase the roadside safety; (ii) an effective transition is available for the section with interface of semi-rigid and rigid guard fence (guard fence transition from subgrade to bridge); (iii) rumble strip in the road shoulder, a new road safety technology; and (iv) strengthened guard fence (the interval of post is denser and the guard fence is wider) was adopted for high embankment section.

The outcome of the study was comparatively widely applied in RGE, and its roadside safety had been improved effectively, and the outcome had been also applied in the other expressways in Jiangxi Province.

HIV/AIDS. With the hard efforts of Disease Control Centers along RGE, HIV/AIDS prevention baseline survey and prevention & interference activities were completed smoothly. 1182

construction workers and 735 residents along RGE were involved in questionnaires survey and accepted VCT testing at the first stage, thus the self-protection awareness was enhanced and its active influence on society was occurred, especially the peer education among the construction workers is an innovative way for the widespread broadcast of HIV/AIDS prevention and interference education in other projects in the future.

Electronic Toll Collection (ETC). Manual toll collection assisted by computer and detector is adopted for RGE, that is, manual toll collection, computer management and detector verification. Passenger bus is charged according to the types of buses, and cargo truck is charged based on the basic toll rate of 0.08Yuan/ton*km and the actual tonnage of truck and goods measured by the weighbridge at the toll station, the truck less than 10T in weight is charged based on basic toll rate; the truck between 10T and 40T in weight is charged in two parts, that is, the part below 10T is charged on basic toll rate and the another part beyond 10T is charged on toll rates reduced linearly from 0.06 to 0.03Yuan/ton*km; the truck above 40T in weight is charged on 40T. Vehicles with the total weight less than 5T are charged on 5T; if the charged toll is less than 5Yuan, it will be charged 5Yuan.

ETC is the development trend of toll collection technology, ETC system is compatible with manual toll collection system. And ETC toll collection system has the following 3 advantages: i) increase the efficiency of toll collection, and put an end to the corruption, cheat and improper toll collection; ii) reduce the traffic congestion, additional fuel consumption and pollution; iii) enhance traffic efficiency. Under the help of the World Bank, 2 ETC lanes were installed at North Ganzhou Toll Station of RGE. Up to now, more than 100 ETC lanes were completed for over 3000km expressway in Jiangxi Province; this year additional 655km expressway will be in place and more than 100 ETC lanes in total will be completed by the end of this year; in the next two years, according to the planning, more than 100 ETC lanes will be newly built in Jiangxi, then there will be more than 200 ETC lanes in total for the expressways in Jiangxi Province.

Training Program and its Outcome Domestic Training. Project Office sent its staff to participate many training activities on resettlement, environmental protection, financial management and safety management and etc. held by the World Bank. 150 person * month domestic training was completed with a total cost of about USD3000. Overseas Training. SPN of overseas training was published on UN Development Business, and China Daily on January 17, 2008. HY 01 contract was procured through QCBS; RFPs were sent to the interesting training consulting companies on June 17, 2008 and received 5 sets of Proposals from five training consulting companies, TTA Technology Training Company was recommended as successfully bidder after careful comprehensive evaluation. Contract signed between Project Office and TTA on March 23, 2009, and formal contract was signed on May 27, 2009. At present HY01 is being implemented and expected to be completed by the end of 2010.

Outcome. Technical staffs from JPTD were trained in the field of highway management, highway design and planning, financial management, highway maintenance and traffic engineering and etc, and good outcome was achieved. These trained staffs played their active role during the implementation of the projects.

3、General view on the Project

Under the leadership of JPTD, the support of local governments and people along RGE and two- and-half-year hard efforts of Project Office and Contractors and Supervisors, RGE was completed and opened to the traffic on April 28 2009, all components of the JP3 were successfully

completed and the main objectives of the Project were achieved. One 117 km RGE, 9 km connecting road and 48.5km local road were completed.

The original 3-year construction period was shortened to two and half years, which is attribute to professional planning and management of works construction and hard efforts of all construction works and technical/managerial staff. Accelerating the forming of expressway network in Jiangxi Province and greatly improving the accesses in poor Southern Jiangxi Province will provide high quality passages to international seaports and airports of the coastal areas and shorten the travel time from Jiangxi Province to the neighboring provinces of Fujian, Guangdong Hunan and etc.

Design Experience

RGE was designed by Jiangxi Provincial Communication Design Institute (JPCDI). JPCDI assigned deign representatives to the site during the construction to be in charge of variation and drawing improvement. We think the design needs advanced idea, technical innovations and scientific management, and the design needs to be improved continuously during the construction.

Project Implementation Experience

Application of World Bank Policy, Full Monitoring at All Stages. JPTD fully applies World Bank’s management experience to resettlement, environmental protection and etc. at all stages, and environment and affected DPs’ benefits were protected comparatively well; according to the international FIDIC clauses, the main works were procured through ICB with the lowest bid price be the successful bidder, which reduced the construction cost; The Project was implemented according to the World Bank’s policy, the managerial staffs learned a lot from the implementation of the Project, and comparatively good social and economic benefits were achieved, and the overall efficiency was improved.

Fulfilling the contract and timely communication are the key point of project management. Project Office paid much attention to the realization of bidding commitment, especially the availability of personnel, equipments and construction preparation. RGE is an expressway with a comparatively high ratio of bridge & tunnel in Jiangxi Province, there are many tunnels, viaducts, high side slopes and many sections with geologically complicated red sand rock. The construction is hard. Therefore, Project Office actively communicated the contractors’ high-level authority and got their support for the construction of the Project, and created good construction condition for the contractors.

Quality control. (i) Establish regulations, improve quality assurance system. In the beginning of works commencement, Project Office prepared RGE Project Management Outline, Supervision Service Program, and Punishment on Improper Site Operation; meanwhile there are three-level quality assurance system, that is governmental inspection, supervision and self-inspection of contractors. It is required that the site resident engineer should do sample testing and inspect the quality as required in the whole process of works construction. Quality Supervision Station under JPTD had sent a work group to the site of the Project to strengthen the routine supervision of the works quality; (ii) To strengthen the work efficiency of the supervision companies, Project Office made the work procedure clear that the next work process must not be started when the previous work process is disqualified and when contractors had not reported and asked for inspection or the supervision engineers had not signed and accept the works. At the same time, Project Office prepared strict Site Patrol Inspection System which required the staff to do inspection diary, and urged the contractors and supervision engineers to deal with the various problems; and (iii) Pay much attention to the establishment of laboratory of supervision companies with adequate testing equipments and personnel. The supervision companies carried out independently testing and inspection so as to control the quality of material, ensure scientific mixing ratio, improve technique and assure the works quality. Besides overall inspection was carried out monthly, more

than 10 special inspections on red sandy rock subgrade, abutment backfilling of bridges and culverts, bridge girders, pavement quality were done. 29 pieces of piers of category III and IV were disqualified and demolished and rebuilt, walls of passages with slabs at 11 places were demolished and rebuilt, one piece of 40m girder and 27 pieces of hollow slabs were rejected, 1.3km subgrade and 460m drainage works was reconstructed, and 4000 cubic meters of disqualified materials were rejected.

Operation experience

The operation of RGE is basically good. Since the opening to the traffic on April 28, 2009, Ganzhou Management Division is in charge of the operation, management and maintenance of RGE, after more than one year’s operation, the RGE’s condition is basically good. RGE brings great benefits to the areas along it and effectively promote the great development of local industry and agriculture.

Independent Ruigan Maintenance Center (RMC) is in charge of the maintenance of RGE. RMC can deal with various defects and damages to keep RGE safe and smooth.

Traffic Volume on Expressway and Other Highways

Actual daily traffic volume on RGE is a little less than target value, and the traffic volume on NHNo.323 is not decreased as it was expected in that year, but increased. The reasons are as follows: i) Two expressways of Ruijin to Ailing (to Fujian Province) and Ganzhou to Chongyi (to Hunan Province) have not been completed and opened to the traffic, so the Ruijing to Ganzhou Expressway (RGE) can attract the less traffic from the neighboring provinces. ii) NHNo.323 is Class II road, and the section from Ruijin to Ganzhou had been reconstructed in 2005, and the road condition is good at present with good horizontal and longitudinal alignment, and furthermore from February 21, 2009, the vehicles did not pay the toll any more when running on NHNo. 323, thus partial traffic volume was attracted from the RGE. iii) Due to the global economic recession and financial crisis during 2006-2009, a huge number of migrant workers in the villages along the NHNo.323 came back home, so the traffic volume of cars and motorcycles became more and more; and moreover RGE was experiencing the peak construction at the time period, a lot of construction vehicles, material- hauling vehicles and other construction equipments caused the increase in the traffic volume on NHNo.323. iv) In recent years, local governments set up the economic development zone along NHNo.323, so the traffic volume on NHNo.323 are also varied according to the prosperity and recession of the economic development zone.

4. Borrower’s Performance

In order to implement JP3, JPTD established World Bank Loan Project Office of JPTD in 2005 in charge of project pre-preparation, bidding activities, management, coordination, land acquisition, environmental protection, resettlement, plan and financial management and etc. After hard efforts of all parties involved, RGE was completed one year ahead of schedule. The quality of the RGE Project is rated as good by Quality Supervision Station under JPTD with an evaluation point of 97.57.

5. World Bank’s performance

The World Bank started project preparation of JP3 in 2005. The World Bank pre-appraisal mission assessed the JP3 technically, economically and etc. During the construction, the World Bank inspection missions provided practical and helpful recommendation on quality control, financial management and institutional strengthening. During the preparation and construction stage, the World Bank provided Project Office abundant support, and the World Bank has a good cooperation with Project Office. The World Bank officials understood the demand of traffic infrastructure development and provided support. The People’s Government of Jiangxi Province and JPTD express sincere thanks for the World Bank’s cooperation and support.

6. Experience and Lessons

It took nearly two years for the project pre-preparation including project identification, preparation, appraisal, negotiation and approval from the Board with World Bank economists, finance experts, resettlement experts, environment experts and engineers being involved. It is deserved for us to learn from the World Bank how to identify correctly the project, how to carry out plan alternative comparison and selection, institutional establishment, preparation of Project Implementation Plan, and Project Procurement Plan and risk management and etc. The expressway project is a major long-term investment, in order to obtain the best technical solutions, establish proper organization and forecast and treat in advance relevant issues, it is deserved for us to take a long time for the project pre-preparation.

Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders Not applicable

Annex 9. List of Supporting Documents

Chen Chong, 2009. Report on Progress Review of HIV/AIDS Education Program Under Jiangxi Highway Project III.

Deng, Fei and Wang, Peng, 2009. World Bank Financed Jiangxi Expressway III Project – Successful Experience in Environmental and Social Impact Mitigation. World Bank, East Asia and Pacific Region, Sustainable Development Department.

World Bank. 2006. People’s Republic of China: Third Jiangxi Highway Project. Project Appraisal Document.

World Bank, 2006. Loan Agreement, Third Jiangxi Highway Project. November 23, 2006

World Bank. 2009. Project paper on a proposed restructuring of the Jiangxi 3 Highway Project (Loan number 4843-Cha for the People’s Republic of China).Internal Bank document prepared by Transport Sector Unit, Sustainable Development Department East Asia and Pacific Region, August 2009.

World Bank. Supervision Missions’ Aide-Memoires, Third Jiangxi Project, 2006-2010.

Wuhan University, Center for Involuntary Resettlement Research, 2009. Resettlement Completion Report, The World Bank Financed Jiangxi 3 Expressway project.

47 CHINA THIRD JIANGXI HIGHWAY PROJECT

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