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Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No: 64935-KZ PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN Public Disclosure Authorized IN THE AMOUNT OF US$1,068 MILLION TO THE REPUBLIC OF KAZAKHSTAN FOR THE EAST-WEST ROADS PROJECT (ALMATY – KHORGOS SECTION): Public Disclosure Authorized WESTERN EUROPE-WESTERN CHINA INTERNATIONAL TRANSIT CORRIDOR (CAREC 1b) March 30, 2012 Sustainable Development Department Central Asia Country Unit Europe and Central Asia Region Public Disclosure Authorized This document is being made publicly available prior to Board consideration. This does not imply a presumed outcome. This document may be updated following Board consideration and the updated document will be made publicly available in accordance with the Bank‘s policy on Access to Information. CURRENCY EQUIVALENTS (Exchange Rate Effective March 2, 2012) Currency Unit = Kazakhstan Tenge (KZT) KZT 148.67 = US$1.00 US$1 = 0.77 Euro FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS AADT Average Annual Daily Traffic IP Inspection Panel ADB Asian Development Bank IRI International Roughness Index CAREC Central Asia Regional Economic IS Implementation Support Cooperation CIS Commonwealth of Independent States ISA International Standards on Auditing CMP Customs Modernization Project IsDB Islamic Development Bank COFP Committee for Finance Control Procurement JERP Joint Economic Research Program CPAR Country Procurement Assessment Reviews JICA Japan International Corporation Agency CPS Country Partnership Strategy KVD Kazakhavtodor CR Committee for Roads KZT Kazakh Tenge CSO Civil Society Organization LCS Least Cost Selection CU Customs Union MoEP Ministry for Environmental Protection DEU Local Road Maintenance Center MoF Ministry of Finance DFID Department for International Development MoTC Ministry of Transport and Communications DPO Development Policy Operation MMG Motorway Management Group EBRD European Bank for Reconstruction and NCB National Competitive Bidding Development EDB Eurasian Development Bank NGO Non-governmental Organization EIA Environmental Impact Assessment NPV Net Present Value EIRR Economic Internal Rate of Return OPRC Operations Policy Review Committee EMP Environment Management Plan ORDs Oblast Road Departments EOI Expression of Interest PAS Procurement Accredited Staff ESIA Environmental and Social Impact PAT Performance Assessment Tool Assessment EU European Union PDO Project Development Objective ESAL Equivalent Single Axel Load PFM Public Finance Management EWRP East-West Roads Project PFS Project Financial Statements FBS Fixed Budget Selection PIC Project Institutional Consultant FL Flexible Loan PMC Project Management Consultants FM Financial Management POM Project Operations Manual FMS Financial Management Specialists PPL Public Procurement Law FSU Former Soviet Union PPP Public-Private-Partnership GAC Governance and Anti-Corruption QBS Quality-Based Selection GDP Gross Domestic Product QCBS Quality and Cost-Based Selections GIS Geographic Information Systems RAMS Road Asset Management System GNI Gross National Income RAP Resettlement Action Plan GoK Govt. of the Republic of Kazakhstan RFP Resettlement Policy Framework GPN General Procurement Notice RIR Resettlement Implementation Report HDM-4 Highway Development and Management RPM Regional Procurement Manager Model HR Human Resources RRA Roads Reforms Advisor IAB Internal Audit Board SBDs Standard Bidding Documents IBRD International Bank for Reconstruction and SIL Specific Investment Loan Development IC Individual Consultants SNIP Standards for construction and maintenance ICB International Competitive Bidding SOE Statement of Expenditure ICBC International Centre for Cross Border SPNs Specific Procurement Notices Cooperation IDF Institutional Development Fund SWRP South-West Roads Project ICT Information and Communications TSD Transport Sector Development Technologies IFIs International Financial Institutions UNDB United Nation Development Business IFR Interim Financial Report USAID United States Agency International Development INT Integrity Department WE- Western Europe-Western China WC IFR Interim Financial Report WTO World Trade Organization Regional Vice President: Philippe H. Le Houérou Country Director: Saroj Kumar Jha Country Manager: Sebnem Akkaya Sector Director: Laszlo Lovei Sector Manager: Henry G. R. Kerali Task Team Leader: Jacques Buré KAZAKHSTAN East-West Roads Project (Almaty – Khorgos Section): Western Europe-Western China International Transit Corridor (CAREC 1b) CONTENTS Page I. STRATEGIC CONTEXT .................................................................................................1 A. Country Context ............................................................................................................ 1 B. Sectoral and Institutional Context ................................................................................. 2 C. Higher Level Objectives to which the Project Contributes .......................................... 5 II. PROJECT DEVELOPMENT OBJECTIVES ................................................................6 A. PDO............................................................................................................................... 6 B. Project Beneficiaries ..................................................................................................... 7 C. PDO Level Results Indicators ....................................................................................... 8 III. PROJECT DESCRIPTION ..............................................................................................8 A. Project Components ...................................................................................................... 8 B. Project Financing ........................................................................................................ 10 Lending Instrument ........................................................................................................... 10 Project Cost and Financing ............................................................................................... 10 C. Program Objective and Phases.................................................................................... 11 IV. IMPLEMENTATION .....................................................................................................12 A. Institutional and Implementation Arrangements ........................................................ 12 B. Results Monitoring and Evaluation ............................................................................ 12 C. Sustainability............................................................................................................... 13 V. KEY RISKS AND MITIGATION MEASURES ..........................................................13 VI. APPRAISAL SUMMARY ..............................................................................................14 A. Economic and Financial Analyses .............................................................................. 14 B. Technical ..................................................................................................................... 15 C. Financial Management ................................................................................................ 16 D. Procurement ................................................................................................................ 17 E. Social (including Safeguards) ..................................................................................... 18 F. Environment (including Safeguards) .......................................................................... 20 Annex 1: Results Framework and Monitoring .........................................................................23 Annex 2: Detailed Project Description .......................................................................................27 Annex 3: Implementation Arrangements ..................................................................................42 Annex 4 Operational Risk Assessment Framework (ORAF) ..................................................59 Annex 5: Implementation Support Plan ....................................................................................65 Annex 6: Team Composition.......................................................................................................68 Annex 7: Economic and Financial Analyses ..............................................................................69 Annex 8: Other Trade Facilitation Programs and the Khorgos Border Crossing Point ......75 Annex 9: Governance and Anti Corruption Action Plan .........................................................78 Annex 10: Map Nos. IBRD 39086 and 39087 ............................................................................86 . PAD DATA SHEET Kazakhstan East-West Roads Project (Almaty – Khorgos Section): Western Europe - Western China International Transit Corridor (CAREC-1b) (P128050) PROJECT APPRAISAL DOCUMENT . EUROPE AND CENTRAL ASIA ECSS5 . Basic Information Date: 30-March-2012 Sectors: Rural and Inter-Urban Roads and Highways (90%), General transportation sector (10%) Country Director: Saroj Kumar Jha Themes: Trade facilitation and market access (80%), Regional integration (10%), Infrastructure services for private sector development (10%) Sector Manager/Director: Henry G. R. Kerali/Laszlo Lovei Project ID: P128050 EA Category: A - Full Assessment Lending Instrument: Specific Investment
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