World Bank Document

Document of The World Bank

FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 442la-TUN Public Disclosure Authorized TUNISIA

SFAX FLOOD PROTECTION PROJECT

STAFF APPRAISAL REPORT

April 27, 1983 Public Disclosure Authorized

Public Disclosure Authorized Water Supply and Sewerage Division Europe, Middle East and North Africa Region

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS

(As of February 1983)

Currency Unit = Tunisian Dinar (TD) 1,000 Millimes TD 1 = US$ 1.587 US$ 1 TD 0.630

ABBREVIATIONS

3 ft = foot m /s = cubic meters per second 3 lpcd = liters per capita per day Mm = million of cubic meters m = meter mm = millimeter s = second cm = centimeter g/i gram per liter

MEASURES AND EQUIVALENTS

Metric System US System

Kilometer (km) 0.62 mile (mi) Hectare (ha) = 2.47 acres (a) Meter (m) = 39.37 inches (in) Cubic meter (m3) = 264 US gallons (gal) 3 Million cubic meters/year (Mm /year) = 0.72 million US gallons per day (mgd) Liter (1) = 0.264 US gallon (gal) Liters per second (I/s) = 22,800 US gallons per day (gd)

GLOSSARY OF ACRONYMS

ADB = African Development Bank BIRH Bureau de l'Inventaire des Recherches Hydrauliques DAT = Direction de l'Aménagement du Territoire DHU Direction de l'Hydraulique Urbaine DRES = Direction des Ressources en Eau et en Sol EEC EEuropean Economic Community # IBRD = International Bank for Reconstruction and Development ME = Ministry of Equipment NIS = National Institute of Statistics ONAS = Office National de l'Assainissement SONEDE = Société Nationale d'Exploitation et de Distribution des Eaux USAID = United States Agency for International Development

FISCAL YEAR

January i - December 31 FOR OFFICIAL USE ONLY TUNI SIA

SFAX FLOOD PROTECTION PROJECT

STAFF APPRAISAL REPORT

Table of Contents

Page No.

I. FLOOD PROTECTION AND STORM DRAINAGE ...... 1

General...... 1 Sector Organization ...... 1 Bank Involvement in the Sector ...... 2

II. PROJECT AREA ...... 4

General. 4 Physical Settings. 4 Rainfall. 5 Population and Hsousing. 5 Flood Characteristics in Sfax Area . 6 Existing Flood Protection ...... 6 Land Occupation...... 7 Insurance...... 7

III. THE 1982 FLOOD ...... 8

Physical Characteristics ...... 8 Damages and Damage Estimates ...... 8 Flood Relief Assistance ...... 8

IV. THE PROJECT ...... 10

Genesis ...... 10 Objectives ...... 10 Description ...... 10 Engineering ...... il Cost Estimate ...... il Project Financing ...... 13 Implementation...... 13 Maintenance ...... 14 Procurement ...... 14 Disbursements ...... ,.,...... 15 Advance Contracting and Retroactive Financing .16 Accounting and Auditing Procedures.17

This report was prepared and written by Messrs. Johan Van Beuzekom, Michel Pommier, Xavier Legrain and Carl Cook (Consultant).

Cost Recovery ...... 17 Reporting ...... 18

V. JUSTIFICATION...... 19

Sectoral Approach ...... 19 Alternative Solutions .. 19 Least Cost Solution...... 19 Economic Justification ...... 20 Benefits of the proposed project ...... 20 Environmental Impact ...... 20 Project Risk ...... 20

VI. AGREEMENTS REACHED AND RECOMMENDATIONS ...... 21

LIST OF ANNEXES

No.

l Organization chart of the Ministry of Equipment and Urban Hydraulics Directorate. 2 Damage Estimate - Flood of October 30-31, 1982. 3 Rainfall depth, duration frequency relation. 4 Flood frequency/damage relation. 5 Least Cost Solution. 6 Annual Project Investments. 7 Implementation Schedule. 8 Accounting and Auditing Procedures 9 Selected Documents available in Project File.

Map No. IBRD 17067 TUNISIA

SFAX FLOOD PROTECTION PROJECT

STAFF APPRAISAL REPORT

I. FLOOD PROTECTION AND STORM DRAINAGE

General

1.01 Tunisia is located on the southern bank of the Mediterranean sea about midway between Gibraltar and Suez. It occupies an area of 160,000 km2 which is rather poorly endowed with natural resources. The great Atlas mountain chain, which runs from west to east about 280 km south of the northern coastline, separates the country into two distinct regions. North of the Atlas mountain chain is a semi-arid area where the majority of the population lives and where most potentially irrigable land is found. Industries and other economic activities are concentrated in the northern coastal areas. The mean annual rainfall in this region fluctuates around 600 mm. South of the Atlas mountain chain lies arid land with an average annual rainfall of less than 200 mm.

1.02 Administratively, Tunisia is divided into 20 governorates, 136 coun- ties and 162 communes. Nearly half of the estimated total population of 6.4 million, which is growing at an average annual rate of 2.2%, is considered urban. More than one-third of the urban population is concentrated in Tunis and Sfax, the two largest metropolitan areas. The rural population is widely dispersed into more than 3,500 locations often isolated from each other and where low population density to a great extent impedes rapid implementation of services.

Sector Organization

1.03 The Directorate of Urban Hydraulics (DHU) of the Ministry of Equip- ment is responsible for urban flood protection works. The Regional Direc- torates of the Ministry are responsible for the maintenance and repair of these works, but until now there have been no specialized units at the regional level to ensure maintenance and repair of the flood protection infrastructure, or to maintain community action in the event of a flood. However, the Ministry has decided to set up such units within its Regional Direc- torates, including one in the Sfax area (paras. 4.03 vi. and 4.11). The "Office National de l'Assainissement" (ONAS), which operates under the Ministry of Equipment, is responsible for combined urban stormwater and sewerage systems. The Directorate of National Land Planning (DAT) of the Ministry of Equipment oversees the preparation and execution of national and urban plans; it is currently preparing a countrywide flood hazard map with the assistance of Stockholm University. The Ministry of Agriculture manages all water resources. The Bureau of Hydraulic Inventory and Research (BIRH), a public enterprise which operates under the Ministry of Agriculture, is responsible inter alia for studies and research related to rainfall and river flow. - 2 -

Finally, rainfall data have been collected by the Ministry of Agriculture and the Meteorological Service of the Ministry of Transport and Communications.

Bank Involvement in the Sector

1.04 The proposed project would be the first Bank financed free-standing flood control project in Tunisia. However, the Bank has been involved indirectly in flood control in the past by financing stormwater drainage as a part of sewerage projects. The Bank has been very active in the related water supply and sewerage sectors. It has helped, inter alia, to establish and deve.lop the entities responsible for water supply and sewerage (SONEDE and ONAS) and has maintained a continuous and close dialogue with the Tunisian Government on sector policies and operating. practices. In the water supply sector, the Bank Group has made five loans and one credit totalling US$ 124.5 million and is preparing a rural water supply project. The sewerage sector received four loans and one credit from the Bank Group. All these operations have also helped to finance stormwater drainage components:

(i) the Tourism Infrastructure Project (Loan 858-TUN for US$ 14.0 million and Credit 329-TUN for US$ 10.0 million, both of September 28, 1972) included US$ 16.64 million for sewerage in six tourist zones. The project was revised as the result of changes in the Government's tourism development objectives in 1975, and suffered further delays due to related changes needed in the detailed design and additional time needed to complete detailed land-use plans and acquire land. The revised project was completed in 1981 and is operating satisfactorily;

(ii) the First Urban Sewerage Project (Loan 1088-TUN of February 18, 1975 for US$ 28.0 million). The main objectives of this project were to support the establishment of ONAS as an effective operating agency, to clean up Lake Tunis by building a storm drainage canal along its shores and to improve the sewerage facilities of the Greater Tunis area. This project which is now completed has had a major environmental impact because of the depollution of Lake Tunis and the sup- pression of sewage olfactive nuisances. As a consequence, the land value around the Lake has increased considerably and a government agency (Société d'Aménagement des Berges du Lac) has been recently established to develop the lake shores;

(iii) the Second Urban Sewerage Project (Loan 1675-TUN of April 13, 1979 for US$ 26.5 million). This project is part of ONAS' Fifth Develop- ment Plan (1977-81) to develop the sewerage sector through improve- ment and extension of waste water collection, treatment and disposal facilities and stormwater systems in the Greater Tunis and Greater Sfax areas. Project implementation is progressing satisfactorily, although three stormwater collectors are being retendered as original bids were considerably higher than anticipated and additional local funds had to be allocated; and - 3 -

(iv) the Third Urban Sewerage Project (Loan 2255-TUN) approved by the Board on March 29, 1983 is part of ONAS' Sixth Development Plan (1982-1986) to rehabilitate and extend sewerage and storm drainage facilities in thirty medium sized towns throughout Tunisia, including four communities in the suburbs of Sfax.

In addition, three urban development projects contain sewerage and stormwater drainage components. Urban Development I (Loan 937-TUN, Credit 432-TUN of October 5, 1973 for US$ 18 million), which is now completed, contained several sewerage studies. Urban Development II (Loan 1705-TUN of May 31, 1979 for US$ 19 million) includes US$ 3.9 million for the improvemenitand expansion of water supply and sewerage systems in several low income settlements. This project also contains a solid waste component including a study which is now being executed by ONAS. Urban Development.III (2223-TUN of January 11, 1983), loan of US$ 25 million, includes US$ 2.7 million for the upgrading and expansion of water supply and sewerage systems in low income areas.

1.05 The Project Performance Audit Reports on the first two water supply projects (PPAR No. 1902 of Pebruary 13, 1978) and of the third water supply project (PPAR No. 3914 of May 4, 1982) concluded that these projects had met their objective of providing water of acceptable quality for the increasing requirements of the population in the areas served, and contributed greatly towards the development of SONEDE into a technically sound and financially viable institution. The audit for the third water supply project concluded that more detailed engineering should have been carried out prior to Board presentation. The Operations Evaluation Department (OED) has also published a Sector Operations Review on the Water Supply and Waste Disposal Program in Tunisia (Report No. 4146 of October 20, 1982) which states that there have been few examples of the Bank's involvement in the Water Supply and Waste Disposal Sector as successful as the Tunisian experience. The reasons for the success are stated to be the Government's commitment to its sector policy objectives, and the harmony of the Bank's program with these objectives. -4-

II. PROJECT AREA

General

2.01 Sfax is Tunisia's major port and second largest city with a 1982 estimated population of 313,000. It is located on the country's east coast about 267 miles from Tunis, the capital. Greater Sfax consists of the port area, the industrial zones located in the littoral corridor, north and south of the port, the traditional quarter or Medina, followed to the west by pockets of densely populated slums, the "r'bats", and more recent residential developments. Beyond these lie low density, one family homes built on garden lots of substantial size, the "j'neins" (IBRD Map No. 17067). Sfax has developed at the expense of these lots which are gradually being subdivided. Clusters of commercial activity, the "merkhez", which include craftsmen shops and markets have appeared where major roads pass through the j'neins. Indeed, some of the larger merkhez have eventually become townships. Greater Sfax includes the surrounding communities of Agareb, El Aïn, Sakiet Ezzit and Sakiet Ed Dair and covers an area of 13,000 ha. (IBRD Map No. 17067), while the Sfax Governorate covers 708,600 ha. The majority of usable land in the Governorate is under cultivation, about 300,000 ha. being devoted to olive trees alone. The following table shows Greater Sfax' spatial structure.

Spatial Structure of Sfax _/

% of % Density Urbanized Population (residents/ha) (lodgings/ha) area center 1.5 10 125 23 r'bats 1.6 31 400 70 private lots 2.3 8 70 13 public lots 0.8 6 160 30 subdivided gardens 25.0 35 24 5 large gardens 69.5 29 12 2.5 transport, industry, other 9.3 1 -

Physical Settings

2.02 The soil in and around Sfax is composed of sandy loam with very little humus. It is generally loose and permeable to the infiltration of surface water. However, the water table is relatively high and cannot absorb much rain water. Near the sea, in Sfax's inner city, the water table is only 0-80 cm below ground level. It only reaches a level of 2-10 m west of the city. The water table is sometimes above ground level and forms swamps and stagnant pools. Sfax' porous soil therefore does little to decrease storm-

1/ Source: Groupe Huit, Plan Directeur du Grand Sfax, Urbanisme et Concerta- tion, 1977. - 5 - water runoff. The soil storage capacity would not be increased either by water extraction for economic activities because it would be replaced by salt water infiltrating from the sea.

2.03 Sfax lies at the low end of a gently sloping plain which covers an area of roug',ly 15 km by 9 km. The gradient of the slope from the sea to about 15 km frointhe coast averages about 2% to 3%. Even beyond this point the gradient is not severe. The slope of the first several kilometers from the coast is less than the average. This area coincides with a generally high water table and it is therefore the area where it is the most difficult to evacuate stormwater.

2.04 Sfax is located in a semi-arid area, and its sparse vegetation tends to be overgrazed. This reduces the moisture absorption capacity of the soil and constitutes another flood enhancing factor. Furthermore, as urbanization pushes further inland, the protective hedgerows or "tabias" built along the large garden lots are partly destroyed because of sales and inheritance practices. These tabias, which consist of soil berms crowned with cactus hedgerows and which can reach a height of two meters or more, help to hold the soil, reduce runoff and increase absorption of rain water, and are particularly effective when built perpendicularly to the flow, for they then tend to trap water, hold it in place and permit greater infiltration.

Rainfall

2.05 The annual average rainfall in the Sfax region is about 200 mm but precipitations as low as 37 mm have been observed in 1946-47 and as high as 650 mm in 1969-70. Most of the rain falls in the months from September to December, and to a lesser extent in the month of March. Sunmners are practi- cally dry. Floods usually occur in October, undoubtedly the wettest month, with an average rainfall of 40 mm and a recorded maximum of 463 mm. Rains are usually local and torrential and may have intensities as high as 20 mm per 15 minutes. Rainfall data gathered over a 100 year period have been analyzed and a depth-duration-frequency correlation has been established (Annex 3).

Population and Housing

2.06 In the period 1975-1982, Greater Sfax' population grew from 260,000 to 313,000, or an average of 2.7% per year. However, because of its importance as a port, its industries, its agricultural base, and its strategic position as service center for Southern Tunisia, Sfax is expected to grow faster than the rest of Tunisia at about 2.8% per year and thus reach around 450,000 by 19951/. This appears justified because of Sfax' overall

1/ "Le Grand Sfax - Evolution Récente - Développement Futur", by Noureddine Karray, June 1982 -6-

activity, and the fact that it has the country's highest employment rate and that average family income is relatively high and makes it attractive to potential migrants from the hinterland or other small towns.

2.07 Houses are typically built of clay or concrete blocks with cement facing. The mortar used is often of poor quality and disintegrates slowly when saturated with water. Houses are generally small, and owner-built and occupied. This type of house is particularly vulnerable to heavy floods and the resulting damage is often irreparable.

Flood Characteristics in Sfax Area

2.08 The typical flash flood in the Sfax area is caused by short, heavy rainstorms concentrated on small areas and generally starts within hours of the onset of the rain, leaving little or no time to evacuate population or their belongings, a task which is particularly difficult when the flood occurs at night. Because of the unpredictability of these storms, no advance warning system is feasible.

Existing Flood Protection

2.09 There are two main dry water courses, or "oueds", near Sfax: Oued Maou in the south and Oued Ezzit in the north. These oueds and their tributaries are dry for all but a few days of the year, to the point that land- owners plant trees and cultivate crops in their dry beds. Oued Maou has been leveed with earth dikes whereas Oued Ezzit bas been left largely without protection. Oued Maou has a small collecting basin in association with a rock- faced weir located where Oueds Agareb and Khalifa meet to form Oued Maou (IBRD Map No. 17067). The left bank levee contains a "blow-out" section designed to fail under extreme flows in order to maintain the integrity of the rest of the system. Oued Ezzit is not leveed and its channel is cluttered in parts with residential and commercial buildings, trees and debris. Its lower reaches are actually occupied by a shop-lined street.

2.10 The oueds and their tributaries are rarely lined, and structural protection measures such as bridge abutments, riprap or gabions are seldom used. There are no adequately sized retention basins and accompanying structures to reduce the velocity of rushing waters and capture some of the sediment and debris they carry. There has been little attempt to maintain the size of the channels aind sediment deposited has only been removed where deposits have created immediate problems, such as on roads or within small storm drainage structures. The result has been a reduction of the carrying capacity of existing channels.

2.11 The Second Urban Sewerage Project (Loan 1675-TUN) includes three stormwater collectors which would evacuate the stormwater of the internal impluvium of the city and as such form an integral part of the flood protection measures envisaged in the proposed project. Construction has been held up because of a cash shortfall to finance the additional local cost component which resulted from bids being substantially higher than the original - 7 - estimates (TD 5.4 million vs TD 2.8 million). During negotiations of the proposed project the Government confirmed the availability of the necessary funds and its expectation that construction would start by November 1983. In view of the importance of these collectors to the success of the project contract(s) award would be a condition of effectiveness of the proposed loan.

Land Occupation

2.12 The treatment of the land in and around the oueds has greatly increased the effects of flooding. The thrust of development of Sfax has been towards the garden lots where the partial destruction of the tabias (para. 2.04), the erection of walls around properties and the creation and surfacing of new streets have all contributed to redirect flood flows, diminish soil absorption and increase the velocity of water runoff. Although the 1975 Law ("Code des Eaux") forbids, inter alia, construction in water courses which are declared part of the public domain, and this Law has usually been enforced, there have been some squatters and other isolated exceptions, such as an olive oil factory built in Oued Ezzit, contributing to the exacerbation of naturally difficult conditions. After the 1982 flood, however, this factory was removed at Government order. Furthermore, most homes built by squatters in the river bed of Oued Ezzit were washed away by the flood and those remaining will be removed during rehabilitation works.

Insurance

2.13 The history and severity of floods in the Sfax area is such that none but a few large commercial concerns have been able to obtain flood insurance coverage. Insurance companies have indicated that, once the level of risk will be substantially diminished, they will be prepared to offer coverage at acceptable premium levels (0.3 to 0.8 per thousand of capital insured). III. THE 1982 FLOOD

Physical Characteristics

3.01 On October 30 and 31, 1982 rains of unusual intensity fell over the areas north and west of Sfax. A total of 177.3 mm of rain was registered in 13 hours with a peak hourly rate of 45.2 mm. The storm has been estimated to have had a frequency of occurrence of once in 150 years for the region, i.e., a probability of occurrence of 0.66%. The flood started a few hours after the onset of the rain and peaked during the night of the 30th to the 31st of October. Its intensity was such that the "blow out" section in the levee system along Oued Maou failed as planned (para. 2.09).

Damages and Damage Estimates

3.02 Floods have been recorded as early as 861 A.D. in Tunisia. However, useful data became available only during this century and covers the floods which occurred in 1934, 1957, 1969, 1973 and 1982. Damage estimates were not comprehensive prior to 1982. Records indicate that the 1973 and 1969 floods, for instance, had a frequency of occurrence of 18 and 50 years respectively, while damages may be roughly estimated at TD 14.5 million (US$ 23.0 million) and TD 35.3 million (US$ 56.1 million) respectively in 1983 prices.

3.03 The 1982 flood took at least 69 lives, destroyed about 700 houses and damaged another 8,000. It damaged streets, roads, railways, bridges and power supply lines and telecommunication equipment. It also took its toll on business, industrial and public buildings, equipment, materials and supplies as well as the personal belongings of those whose houses were destroyed or damaged.

3.04 Total October 1982 flood damages in the Sfax area have been conserva- tively estimated at TD 47 million or US$ 75 million equivalent (Annex 2), excluding the loss of lives. Other nearby communities, namely Jebeniana, El Amra and Sidi Mansour also sustained severe damages for an aggregate estimated amount of TD 3.6 million, or US$ 5.7 million equivalent. The mere threat of a flood is costly to the economy. When people fear for the security of their family, their home and their belongings, they are not likely to report to work. In the Sfax area, production losses attributable to this cause alone are broadly estimated at TD 0.9 million, or US$ 1.4 million equivalent each year. The 1982 flood was particularly severe. In more normal years, annual physical damages to roads, in-city transportation, railways, and post and telecommunication equipment easily reaches an estimated TD 1.7 million, or US$ 2.7 million in 1983 prices.

Flood Relief Assistance

3.05 Soon after the severity of the Sfax flood was ascertained, the Tunisian Government and the international community responded with the following assistance: - 9 -

(i) about TD 0.7 million (US$ 1.1 million) was provided by the Tunisian Government for immediate aid to the flood victims;

(ii) disaster aid teams arrived from France;

(iii) disaster assistance personnel, tents and blankets arrived from Germany;

(iv) two large pumping trucks were provided by the United States to assist in cleaning up drains; and

(v) grants amounting to about US$ 10.5 million equivalent were received from oil surplus countries for flood damages sustained throughout Tunisia.

3.06 Emergency relief is a necessary but costly form of assistance in cases where economic means of protection are feasible. Flooding in Sfax is no exception to this rule. The proposed project would help prevent flood disas- ters in the Sfax area at a reasonable cost (para. 5.05). - 10 -

IV. THE PROJECT

Genesis

4.01 Floods have occurred relatively frequently in Sfax, E`d the need for providing flood protection control measures has long been recognized. In the 1950s and 1960s the situation was studied by various consulting firms and some protection was provided with the diversion of the Oued Khalifa and the construction of dikes along this Oued and the Oued Maou. In 1977 and 1978 a French consulting firm (SOGREAH) produced a sewerage and storm drainage master plan proposing a belt canal around the western edge of the city with a number of collectors placed in a radial pattern outside the canal. The northern section of this canal would carry water around the town's perimeter directly into the sea, the southern section would empty into the Oued Maou. As no financing was available at that time, the project could not be implemented. 'However, soon after the 1982 flood, the Government of Tunisia revived it and, in November 1982, requested financial assistance from the Bank to carry it out. Because of the frequency of flooding in Sfax and the need to rehabilitate the damaged dikes before the October 1983 rains, a feasibility study, consisting in part of the updated 1978 master plan and making use of 100 year hydrological data, was urgently prepared in January 1983 by a team of 14 highly qualified specialists from a consortium of French and Tunisian consulting firms, under the guidance of the Bank. The Bank's appraisal is based on this study.

Objectives

4.02 The main objective of the proposed project is to minimize the flood damage potential in Sfax and neighboring communities. It is not economically feasible to devise a project to provide full protection to the entire population of the Sfax region. The aim of the proposed project therefore is to protect as much of the population from as great a flood magnitude as can be economically justified (para. 5.04). The proposed project would reduce the risk of loss of life from floods, give the population a greater sense of security, protect public and individual properties, reduce production losses and ensure permanent and efficient maintenance of flood protection infrastructure through the strengthening of the Regional Directorate of the Ministry of Equipment.

Description

4.03 The proposed project consists of six components:

(i) rehabilitation of the water course of Oued Ezzit on the northern side of Sfax;

(ii) rehabilitation and extension of the existing dikes along Oued Maou and Oued Khalifa on the southern side of Sfax; - il -

(iii) construction of an 8 km long belt canal at about 4 km from the city center;

(iv) minor flood protection works in neighboring villages;

(v) provision of equipment to maintain the flood control facilities;

(vi) staffing, equipping and operation of a special Flood Protection Section within the Regional Directorate of the Ministry of Equipment in Sfax to be responsible for maintenance and repairs of flood protection works; and

Consultant services for detailed engineering and works supervision of the * execution of the project components referred to under (i) through (iv) will also be provided.

Engineering

4.04 The feasibility study for the project is of high quality and has been carried out by a consortium of French and Tunisian consulting firms (SOGREAH, CNR, SOTINFOR). Detailed studies of the new works are well advanced and expected to be completed by June 1983, and the related bid documents by November 1983. In Sfax, rainfalls have been recorded on a 24 hour basis since 1880, and with recording gauges since 1942. Correlations have been established between the frequency, the intensity and the duration of the rainfall and the flood intensity (Annexes 3 and 4). The design flood having a 100 year frequency has been chosen in such a manner that the total cost of the proposed flood protection works and the probable residual damages, both estimated in January 1983 prices, are minimal (Annex 5). The study also covers operation and maintenance requirements, as well as recommendations on the staffing and equipping of a new DHU section to be created within the Sfax Regional Direc- torate of the Ministry of Equipment, responsible for maintenance of flood protection works in the Governorate.

Cost Estimate

4.05 The estimated cost of the proposed project amounts to TD 30.24 million (US$ 47.95 million) with a foreign exchange component of TD 17.50 million (US$ 27.74 million) or 58% of the total cost. Identifiable taxes and duties amount to about 21% of the total cost. The cost estimates include the front end fee of US$ 62.344 which the Covernment has requested the Bank to finance. - 12 -

Local Foreign Total Local Foreign Total TD million ------US$ miion -----

Belt canal at km 4 1.97 3.47 5.44 3.13 5.50 8.63

Dikes along the Oued Khalifa 0.48 0.85 1.33 0.76 1.35 2.11

Rehabilitation of Oued Ezzit 2.98 5.26 8.24 4.73 8.35 13.08

Jebeniana, El Amra and miscellaneous repairs 0.22 0.40 0.62 0.35 0.63 0.98

Rehabilitation of Oued Maou 0.10 0.18 0.28 0.16 0.29 0.45

Sub-Total 5.75 10.16 15.91 9.13 16.12 25.25

Land acquisition/Relocation 2.90 0.50 3.40 4.60 0.79 5.39

Maintenance equipment 0.60 1.40 2.00 0.95 2.22 3.17

Operation and maintenance 0.23 0.04 0.27 0.36 0.06 0.42

Consultants' services 0.24 0.96 1.20 0.38 1.52 1.90

Sub-Total 9.72 13.06 22.78 15.42 20.71 36.12

Physical contingencies 0.85 1.53 2.38 1.35 2.42 3.77

Sub-Total 10.57 14.59 25.16 16.77 23.13 39.90

Price contingencies 2.17 2.87 5.04 3.44 4.55 7.99

TOTAL 12.74 17.46 30.20 20.21 27.68 47.89

Front end fee (0.25% of 24.94 million) - 0.04 0.04 - 0.06 0.06

Required financing 12.74 17.50 30.24 20.21 27.74 47.95

US$ 1 = TD 0.63

4.06 The cost estimates are based on the January 1983 feasibility study and recent bid awards for similar works in Tunisia, and are considered to be reasonably accurate. Costs have been adjusted to April 1983 levels. Physical contingencies for civil works have been estimated at 15%. Price contingencies of 10% for 1983, 9% for 1984 and 8% thereafter for local costs and 8% for 1983, 7.5% for 1984, 7% for 1985 and 6% thereafter for the foreign cost component have been included in the cost estimates. Annex 6 displays the estimated annual project investments. - 13 -

4.07 The project provides for 125 man months of foreign consulting services for the preparation of the detailed engineering studies and the preparation of the bid documents, and 200 man months of local consultants for works supervision. The estimated cost of these services (including foreign travel and subsistence) is TD 1.2 million (US$ 1.9 million) or an average of US$ 9,600 per man month for foreign consultants and US$ 3,500 per man month for local consultants.

Project Financing

4.08 The proposed Bank loan of US$ 25.0 million would finance 90% of the foreign exchange cost of the proposed project, representing 52% of the total cost or 66% of the total cost net of taxes, as well as the front end fee of US$ 62,344. The loan would be made to the Government. During negotiations assurances were obtained that the remainder of the project cost would be financed by the Government, either totally out of its own resources, or partially out of its own resources, supplemented by the proceeds of a loan which the Government has requested from the African Development Bank. Assurances were also obtained that, in addition, the Government will provide any supple- mental funds required for a timely completion of the project.

4.09 Government financing would be partly provided by the following special relief funds; (i) after the 1982 flood that affected several Tunisian governorates, the Government received donations amounting to about TD 6.6 million (US$ 10.5 million) from, inter alia, the Kingdom of Saudi Arabia and the Islamic Conference Organization; these funds have been pooled in a special relief budget ("Fonds de concours") to cover, for the whole country, relief and repair efforts related to the October 1982 floods; (ii) in addition, the Government levied an exceptional national taxi'/ ("Contribution exceptionnelle pour la réparation des dommages inondations") to contribute to flood protection works and damage repairs. This tax is expected to yield TD 5.0 million (US$ 8.0 million); (iii) finally the Solidarity Tax ("Contribution exceptionnelle de solidarité"), instituted ten years ago (Law No. 73-72 of November 19, 1973) to provide funds annually for disaster prevention works and damage repairs, would produce in 1983 about TD 2.0 million (US$ 3.2 million). Project expenditures financed by the Government exceeding the amounts to be allocated for the Sfax region from these special national funds, will be provided through normal budgetary procedures, or partially from the ADB loan (para. 4.08).

Implementation

4.10 The proposed project would be implemented by the Directorate of Urban Hydraulics of the Ministry of Equipment. Consultants will be recruited, in accordance with the Bank Guidelines, to provide assistance for detailed engineering and works supervision when and where required. According to the attached implementation schedule (Annex 7), which has been discussed and agreed upon during negotiations, construction would be completed by June 30, 1988. Land acquisition for the belt canal and relocation of people actually living on the required land is in progress and is expected to be completed

1/ Art. 82 of 1983 Finance Law (Loi de Finance). - 14 - by May 1984. Bids for the acquisition of maintenance equipment are expected to be invited by May 1983 for supply by September of the same year. Bids for the construction works would be invited by November 1983. Works would start before mid 1984 to be completed by mid 1987 for the belt canal and by mid 1988 for the Oued Ezzit protection works.

Maintenance

4.11 By Ministerial Decision of February 2, 1983, the Minister of Equip- ment has specifically charged the Regional Director representing his Ministry in Sfax with the responsibility for the maintenance and repair of flood protection works in the Sfax Governorate. To execute this decision, a new section of the DHU is to be staffed and equipped in the Regional Directorate of the Ministry of Equipment in Sfax (Annex 1). The establishment of this new Section is included in the proposed project. It will be staffed with one engineer and fourteen permanent support staff, which is considered adequate since during emergencies temporary labor can be recruited or borrowed from the Transportation Section. The new Section will be provided with equipment financed under the proposed project. Pending the recruitment of staff and the provision of equipment, the Transportation Section has undertaken some of the most urgent repair works which have to be completed before the 1983 rainy season. During negotiations assurances have been obtained from the Government that it will provide the new Section with adequate staff, equipment and annual operating funds estimated to amount, in constant 1983 prices, to TD 70,000 per year by project completion (Annex 6).

Procurement

4.12 All major civil works and equipment supply contracts, estimated to total US$ 35 million equivalent, will be awarded on the basis of international competitive bidding (ICB) in accordance with the Bank's procurement guidelines. For bid evaluation purposes a 15% margin of preference or an amount equal to the customs duties, whichever is lower, would be applied in the case of equipment manufactured in Tunisia. Small contracts, which are not expected to attract international competition, will be procured through local competitive bidding (LCB), in accordance with Government procedures which are satis- factory. For this type of contract, individual ceilings of US$ 800,000 for civil works and US$ 150,000 for equipment and aggregate ceilings of US$ 4 million and US$ 0.6 million respectively would be retained. Work by force account, after Bank approval, will be carried out by the Ministry of Equipment for repair and rehabilitation works up to a maximum value of US$ 1.5 million. Small works related to connections to, or deviations or protection of, telephone, gas, water, sewerage, electricity, lighting and transport services and lines, estimated at US$ 200,000, will be executed by the Post, Telephone and Telegraphic Authority (PTT), the Electricity and Gas Authority (STEG), the Water Authority (SONEDE), the Sewerage Authority (ONAS), and the Railroads Authority (SNCFT) for the account of DHU according to local procurement procedures for public contracts which are acceptable to the Bank. Consultants, as and when required, will be employed in accordance with the Bank's guidelines - 15 -

for the use of consultants by World Bank borrowers. All ICB bid documents, amounting to about 80% of the total contracted value, would be reviewed by the Bank on a prior to award basis. LCB and the PTT, STEG, SONEDE, ONAS and SNCFT contracts will be subject to ex-post reviews.

Disbursements

4.13 The proposed Bank loan of US$ 25 million would be disbursed as follows:

Category Amount of the loan % of in US$ millions expenditures to be disbursed

1. Civil Works 18.29 58%

2. Acquisition of maintenance equipment 2.40 90% of foreign expenditure and 63% of expenditures for items purchased locally

3. Consultant services 1.64 72%

4. Front end fee 0.06 Amount due

5. Unallocated 2.61

TOTAL 25.00

Disbursements are expected to be completed twelve months after project completion, hence the closing date of the proposed loan would be June 30, 1989. The estimated schedule of disbursements of the proposed Bank loan is as follows; - 16 -

Estimated Schedule of Disbursements

Bank FY and Disbursed per Cumulative % Semester Semester Disbursements ------US$ Million------

1984 lst semester 0.75* 0.75 3 2nd semester 1.50 2.25 9

1985 lst semester 2.00 4.25 17 2nd semester 2.50 6.75 27

1986 Ist semester 3.00 9.75 39 2nd semester 3.00 12.75 51

1987 lst semester 2.50 15.25 61 2nd semester 2.50 17.75 71

1988 lst semester 2.25 20.00 80 2nd semester 2.00 22.00 88

1989 Ist semester 1.75 23.75 95 2nd semester 1.25 25.00 100

* includes front end fee US$ 0.06 million.

4.14 Disbursements for works carried out by force account would be made against certificates of expenditures which would be audited according to standards and procedures acceptable to the Bank (Annex 8). Disbursement records would be available for review by Bank supervision missions.

4.15 Disbursement profiles show that disbursements for the water supply and sewerage sector in the EMENA region have extended over an eight year period while the overall disbursements for Tunisia have extended over seven and a half years. Taking into account the urgency and the special character of the proposed project and the simplicity of the works, it is anticipated that the proposed Bank loan would be fully disbursed in a six year period.

Advance Contracting and Retroactive Financing

4.16 In view of the urgency of the project and in particular the importance of providing the new Flood Protection Section, which will be in charge of maintenance and repair works, with the required tools and equipment, - 17 -

advance contracting for the acquisition of equipment in accordance with the Bank's guidelines is appropriate. No expenditure for this item is expected to be incurred before the signing of the proposed loan. Final studies of the flood protection works including topographical and geotechnical studies and the preparation of bid documents are being carried out by a consortium of consultants engaged in accordance with the Bank's guidelines. In order to speed up the execution of the project the Bank would agree to retroactive financing up to an amount of US$ 600,000 for the work carried out by these consultants starting January 1, 1983.

Accounting and Auditing Procedures q 4.17 The accounting system of the Ministry of Equipment has been reviewed and found to be adequate for the recording and control of project-related financial transactions, including those of the proposed flood protection project, and its maintenance and repair activities. Separate accounts, including sub-accounts to record force account expenditure, will be maintained by DHU to record expenditures along the lines of the proposed loan categories. The accounting and control system is described in detail in Annex 8.

4.18 Government internal control procedures, as presently applied, are acceptable to produce the necessary audit reports; they are also relied upon for several Bank financed agricultural and highway projects. During negotiations, agreement has been reached that the Contrôle Général des Finances carry out annual audits and provide the Bank with audit reports and financial statements of project accounts and force account expenditure sub-accounts of the DHU no later than six months after the close of the fiscal year.

Cost Recovery

4.19 While the benefits of the proposed project would be widespread, the beneficiaries cannot be easily identified. First, different floods affect different parts of the city and it is impossible to predict which residents and the extent to which they may be affected by future floods. Second, the public infrastructure of the entire Sfax Governorate suffers from floods. Third, the whole Tunisian economy is affected because of the essential rail, highway, port and telecommunication facilities through Sfax. The Tunisian policy that the state should pay for the cost of flood prevention infrastructure out of general revenues is therefore acceptable. In addition to the special national relief funds (para. 4.09), part of the cost would be met by the "Fonds communs des collectivités locales", a fund provided by the yield of various municipal taxes including municipal property taxes (para. 5.01), and intended inter alia to finance construction and maintenance of flood protection works. - 18 -

Reporting

4.20 During negotiations assurances have been given by the Government that the Directorate of Urban Hydraulics of the Ministry of Equipment would report quarterly on the progress of the project. Such reports would cover all perti- nent information related to the project including maintenance and repair works and reference to the project implementation schedule and comment on any deviations to it.

4.21 During negotiations, assurances have also been obtained from the Government that within six months following the closing date of the proposed loan.DHU would prepare and submit to the Bank a project completion report reviewing the planned objectives and the achievements of the project, including the costs and benefits derived and the performance and contribution of all parties associated with project execution and systems operation. - 19 -

V. JUSTIFICATION

Sectoral Approach

5.01 The proposed project is the first free standing flood protection project in Tunisia in which the Bank is involved. The technical financial and economical approach has been elaborated in close cooperation with the Direc- torate of Urban Hydraulics and is intended to be used as a model for future flood protection projects. The Bank is also collaborating in a study carried out by the Directorate of National Land Planning, assisted by the Stockholm University, evaluating Tunisia's flood sensitive areas. This study would lead to the establishment of a national flood hazard map and would also look into possible increases in land values resulting from flood protection projects. Increased land values and resulting increased property taxes would contribute to project cost recovery (para. 4.19). A combination of the established approach and the flood risks study may lead to future bankable projects.

Alternative Solutions

5.02 Three basic possibilities were examined:

(i) Legislative solution: This solution relies exclusively on legislative measures to prevent the population from living in high risk areas.

(ii) No action solution: No action is taken and the individuals affected by the disaster, or the Government, assume the cost of the damages when floods occur.

(iii) Structural solution: The construction of flood protection works to protect the endangered areas.

5.03 The legislative solution would depend on a strict zoning policy and thé relocation of tens of thousands of people. This solution is economically prohibitive and politically unacceptable. Zoning alone would not solve the problem as all existing structures in the high risk areas would remain exposed. A comparative cost/benefit analysis of the "no action" and the proposed "structural" solutions demonstrates that the latter is the best solution.

Least Cost Solution

5.04 Considering the topographic and demographic characteristics of Greater Sfax, an intercepting canal between the outside impluvium and the agglomeration to be protected is the most logical solution. The level of protection, i.e. size and capacity of the canal for a 100 year recurrence flood, has been determined in such a manner that the marginal cost of providing the protection equals the marginal benefits. Canal design took into con- sideration several alternatives of construction costs, types of lining, and ongoing maintenance costs. The location of the belt canal would be particularly appropriate since it would be constructed parallel to a belt road under construction which would provide accessibility for maintenance of the canal. Land acquisition for the combined project and relocation of the inhabitants affected is currently in progress and is expected to be completed by May - 20 -

1984. The selected flood protection system represents the least cost solution at a discount rate of 10%.

Economic Justification

5.05 The proposed project would have an economic rate of return (ROR) of about 17.5%. The cost stream includes the investment, operating and maintenance costs (free of taxes and duties) over a 40 year period for the facilities included in the proposed project augmented by the investment, operating and maintenance costs related to three stormwater collectors which are included in the Second Urban Sewerage Project (Loan 1675-TUN) (para. 2.17) and which have not yet been constructed but form an integral part of the necessary flood protection works. The benefit stream consists of the damage cost which would be avoided by constructing the proposed project. To this end, the 1982 and several previous floods were analyzed and a relationship established between the flood frequency and the estimated damage values (in 1983 prices) caused by these floods. The same computation was repeated with the proposed project in place in order to obtain the curve representing the residual damage values (Annex 4). The area between the two curves represents the probable annual averted damages and amounts to TD 4.02 million (US$ 6.38 million) in 1983 prices. For future years it was assumed that these benefits would increase as a result of population and GNP growth in the project area, estimated at about 3% and 2% per annum respectively. As this analysis does not consider unquantifiable benefits (life, health, environment) the above men- tioned rate of return of 17.5% is a minimum value. A sensitivity analysis indicates that a 10% project cost increase would result in a ROR of 16.2%, a 20% decrease in benefits in a ROR of 14.6%, and a combination of a 10% cost increase and a decrease in benefits of 20% would result in a ROR of 13.5%.

Benefits of the proposed project

5.06 One of the most important benefits of the project, not quantified in the analysis, would be its potential for reducing loss of life and human trauma. It would also avoid considerable economic losses in terms of property, personal belongings and foregone production.

Environmental Impact

5.07 The environmental impact of the proposed project would be positive. It would contain flood waters in a designed system and reduce erosion in the project area. It would also prevent occasional spread of overflowing sewage and garbage over the area of inundation and drain currently stagnant bodies of water in the city and reduce related health hazards.

Project Risk

5.08 The proposed project presents no unusual risk. The possibility of slippage and related cost overruns would be minimized by the provision of consultants who would assist the DHU in works supervision. The new Section within the Sfax Directorate of the Ministry of Equipment would minimize the risk of deterioration of the new flood protection facilities. Furthermore, the Bank would closely monitor the establishment of this new Section and supervise implementation of the proposed project. - 21 -

VI. AGREEMENTS REACHED AND RECOMMENDATIONS

6.01 During negotiations agreements have been reached on the following items:

(i) the Government will provide the necessary funds to cover the remainder of the foreign cost requirements and the local cost of the project as well as any cost overruns in a timely manner (para. 4.08);

(ii) the Directorate of Urban Hydraulics will implement the proposed project in accordance with the implementation schedule shown in Annex 6 (para. 4.10);

(iii) the Government will provide the new Flood Protection Section of the Regional Directorate of the Ministry of Equipment in Sfax with adequate staff, equipment and operating funds (para. 4.11);

(iv) the "Contrôle Général des Finances" will carry out the annual audits of the project related construction and maintenance works within the Directorate of Urban Hydraulics and the regional Flood Protection Section and provide the Bank with audit reports and financial statements no later than six months after the close of the fiscal year (para. 4.18);

(v) the Directorate of Urban Hydraulics will report on a quarterly basis to the Bank on project progress and all other project related matters (para. 4.20);

(vi) the Directorate of Urban Hydraulics will prepare and submit to the Bank, within six months following the closing date, a completion report reviewing the planned objectives and the achievements of the project, including the costs and benefits derived and the performance and contribution of all parties associated with project execution and systems operation (para. 4.21);

6.02 The award of contract(s) related to three stormwater collectors included in the center of Sfax will be a condition of effectiveness (para. 2.11).

6.03 Agreement having been reached on the above, the proposed project is suitable for a Bank loan of US$ 25.0 million to the Government of Tunisia for a term of 17 years, including 4 years of grace. TUNISIA SFAXFLOOD PROTECTION PROJECT Organization of the Ministry of Equipment and Urban Hydraulics Directorate

Minister

Other Director ot Directorates Urban Hydraulics

Headquarters Divisions

SFAXRegional Directorate

Regional Director |

I I ~~~~~~~~Trnpr tItion & Techniccul Studies & F~~~loodProtection Public Building Assistance Amnsrto Supervision Infraistructure Sub-division caPulieciAvctnten

Flood Protection Transportation Section Section

World Bank-24764 xi - 23 -

ANNEX 2

TUNISIA

SFAX FLOOD PROTECTION PROJECT

DAMAGE ESTIMATE - FLOOD OF OCTOBER 30-31, 1982 GREATER SFAX

CATEGORY AMOUNTTD (Millions)

Roads 3.65 Public Transportation 1.50 Railways 0.50 Telecommunications 0.75 Electricity 0.38 Water Supply 0.11 Sewerage 0.90 Housing 4.99 1/ Public Buildings 1.70 Agriculture 1.05 2/ Fishing 0.72 Small Businesses 4.90 - Industries 6.64 3 Personal Belongings 8.85 Cleaning up 0.89 Loss of Value Added 9.45 4/ 46.98 5/

(in 1983 prices)

1/ 700 houses destroyed, 8,000 houses damaged. 2/ Includes soil erosion damages. 3/ Losses of equipment and raw materials. 4/ Losses of added value to the economy. 5/ Replacement costs when applicable. -24- ANNEX 3

TUNISIA SFAXFLOOD PROTECTION PROJECT SFAXRainfali; Depth, Duration, FrequencyRelation

6°00 i /t ,

'Evlope of WVorldRecord Volues; 500 T_ riziii

300 i t 1 ii

______T______

Tin =YearsT---20 Return Period

20 ______60~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~odBn-46

1 1.5 2 2 5 3 4 5 6 7 8 9 10 1.5 20 2.5 30 40 50 60 70 80 90 100 Duratinoi n Hours

T ReturnPerhod in Years

Word Bank-24760 ANNEX _ 25 - 4

TUNISIA c SFAXFLOOD pROTECTION PR°aE8c FloodFrqec/ong ReIO0tOfl

100

(1)(2

Natural Dmages 4,315,000 TD/lear 70

PveçiedDamages l 60> by Project C 4.015000 TD/YeOr / ptreabetwveen Curves(1) & (2)

40 \ 1 ResidualDamages | / with ProjeCt > =300,000 TDJYeOr

Icurve(3) isth-e Extenlsionof Curve(2) iOT 20l \ 20 ~~~Qfflages ~~~~~~~~Damagesb""ÉDten~~~~~eiv~~~eeflTnD 7 &ID70 Mjijco &( 0&10 10NaturalDamages(xlo)

1ûQ t \ / \ /

/ ~~~~~~~~~~~~~~~CalculatedPoin)ts

\on'cges- _ MiO D 0 50rl)~~~~~~~~~~~~~DXages -Mijliorn Dincrs W0red Sank-24763 - 26 - ANNEX5

TUNISIA SFAXFLOOD PROTECTION PROJECT Least Cost Solution Cost in DT Millions 20

\ ~~~~~~~~~~TheLeastCost Solution is Situatedat the . \ ~~~~~~~~~~~100YearFrequenc D esign Flood/

TotalCost (3) (3)=(1) +(2)

/ ~~~~~ProjectCost(1 )

ResidualDamages (2)

5 10 50 100 500 log T

T = ReturnPeriod of Design Flood in Years

Note: AJIcost have been actualized at a 10%discout rate to 1983values. WoridBank-2461 SFAX FLOOD PROTECTION PROJECT

ANNUALPROJElCT INVESTMENTS

(Basa April 19837

1983 1984 1985 1986 1987 1988 TOTAL TOTAL Local ForeiEn Total Local FPre-ig Total Local Foc-ign Total Local Porelgo Total Local ForeiEg Total l.ocal Fo-eig Total l.ocal Foreig Total Local Foreign Total …-m-…------$mlin------TDil I _ _ -__ US$ illion-----

cacal-l-t at km 4 - _ 0.47 0.83 1.30 0.63 1.10 1.73 0.62 1.10 1.72 0.25 0.44 0.69 - - - 1.97 3.47 5.44 3.13 5.50 8.63

Dike alang thc O-id Khalifa _ - 0.21 0.38 0.59 0.22 0.38 0.60 0.05 0.09 0.14 - - - _ _ _ 0.48 0.85 1.33 0.76 1.35 2.11

Rhlabilitatioo f Oaed E-ozt - _ _ 0.58 1.01 1.59 0.67 1.19 1.86 0.70 1.24 1.94 . 0.73 1.29 2.02 0.46 0.37 0.83 2.98 5.26 8.24 4.73 8.35 13.08

.Iabooiaoa, El Amra aod miocollaoeooa repairs - - - - _ _ 0.Z2 0.40 0.62 ------0.22 0.40 0.62 0.35 0.63 0.98

Rebablliatîoo cf 0-d Moa. 0.10 0.18 0.28 - - _ - ______- _ 0.10 0.18 0.28 0.16 0.29 0.45

lob-local 0.10 0.18 0.28 1.26 2.22 3.48 1.74 3.07 4.81 1.37 2.41 3.80 98 1.73 2.71 0.46 0.37 0.83 5.75 10.16 15.91 9.13 16.12 25.25

Land acqoisLtla/Rllcattot 1.45 0.25 1.70 1.45 0.25 1.70 ------2.90 0.50 3.40 4.60 0.79 5.39

lainttooaooeoeqoootatc 0.12 0.20 0.40 0.24 0.56 0.80 0.24 0.56 0.80 ------0.60 1.40 2.00 0.95 2.22 3.17

Ope-atinn soi Maaitaoance 0.015 0.005 0.02 O.0225 0.0075 0.03 0.03 0.01 0.04 0.0375 0.0125 0.05 0.05 0.01 0.06 0.07 - 0.07 O.Z3 0.04 0.27 0.36 0.06 0.42

CeolsaI tats' ocroacco 0.00 0.32 0.40 0.04 0.16 0.20 20.54 0.16 0.20 0.04 0.16 0.20 0.04 0.16 0.20 - c - 0.24 0.96 1.20 0.38 1.52 1.90

Sob-Total 1.765 1.035 2.80 3.0125 3.1975 6.21 2.05 3.80 5.85 1.4475 2.6025 4.05 1.07 1.90 2.97 0.53 0.37 0.90 9.72 3.06 22.78 15.42 20.71 36.12

Physclal cootiogotcto 0.015 0.027 0.04 0.19 0.333 0.52 0.26 0.46 0.72 0.20 0.37 0.57 0.15 0.25 0.40 0.07 0.06 0.13 0.85 1.53 2.38 1.35 2.42 3.77

sob-Total 1.78 1.062 2.84 3.20 3.53 6.73 2.31 4.26 6.57 1.65 2.97 4.62 1.22 2.15 3.37 0.60 0.43 1.03 10.57 14.59 25.16 16.77 23.13 39.90

tccccc contscigaocloo 0.04 0.02 0.06 0.38 0.35 0.73 0.50 0.76 1.26 0.53 0.77 7.30 0.51 0.71 1.22 0.32 0.18 0.50 2.17 2.87 5.04 3.44 4.55 7.99

TOiTAiL 1,82 1.08 2.90 3.58 3.88 7.46 2.81 5.02 7.83 2.18 3.74 5.92 1.73 2.86 4.59 0.92 0.61 1.53 12.74 17.46 30.20 20.21 27.b8 47.89

Fract end foc - - - - 0.04 0.04 - 0.06 0.06 Rtaro 1t l ------_- _- _- - - - 12.74 17.50 30.24 20.21 27.14 47.95

US0 1 = TDI 0.63 TUNISIA SFAXFLOOD PROTECTIONPROJECT Implementation Schedule

1983 1984 1985 1986 1987 1988

ITEM ______- ITEM 4 31 S 2 3 4 1 2 3 4 1 2 3 41 2 3 4 1 4

Belt Canail a l m m_m _ lz"" _ __, _a"' _ _

Oued Khalita * _* Im*am lIZ_

Oued EzzI - _ e _ _ wi _ -_ -_ _ _ _ - _ _ _

Jebiniana & ElAmra *g a l a __ SI o

RepoirsOued Maou

Land Acquisition/Relocotion - i | . -

Acquisition of Maintenonce Equipment i l-i lilMil _ _

3 StormwaterCollectors- P li1iS 1 - - -

*U __'* Studies iii0 .... Bidding Procedure Works

*Included in 2nd UrbonSewerage Project (Loan 1675--TUN) World Bcank-24762 - 29 - ANNEX 8 Page1

TUNISIA

SFAX FLOOD PROTECTION PROJECT

ACCOUNTINC AND AUDITING PROCEDURES

A. Budgetary System

1. The state budget comprises two parts: Title I which corresponds to the recurrent budget, and Title II, which is the capital budget. Preparation and consolidation of all budgetary proposals is the responsibility of the Ministry of Finance and Planning. Approval of the budget requires legislative action. In particular, for Title II parliament votes on:

(a) The "loi-programme" which lists investments to be carried out and their estimated cost to be spread over the period of execution;

(b) Annual commitment credits (credits d'engagement) which are authorizations to contract during the year for a given total amount; and

(c) annual payment credits (credits de paiement) which are authorizations to disburse during the year for a given total amount.

After approval each Minister is informed of the commitment and payment credits allocated to his Department. In Title II transfers of "credits d'engagement" between headings (Articles) can be authorized only by the Minister of Finance and Planning. Transfers within headings are authorized by the recipient Ministers; all transfers between "credits de paiement" are also authorized by the recipient Ministers. Following the acknowledged intention of Government to progressively decentralize powers and functions, the recurrent budget is being partly regionalized with allocations directly administered by local authorities. The same policy is expected to be applied in the future to the capital budget, the administration of which is presently still centralized in Tunis.

B. Accounting

General

2. A computer center, administratively attached to the Prime Minister's office, registers all contracts and budgetary commitments. The center receives information from the Ministries on printed data sheets which are approved by the controller (see para. 6) prior to acceptance by the center. A monthly listing is issued by the center and sent to each Ministry concerned for reconciliation with their own internal accounts. However, computerized information is limited to commitments and does not register payments. This reduces its usefulness, as Ministries therefore have to maintain their own internal system to control payments. - 30<, - ANNEX 8 Page 2

Ministry of Public Works

(a) Contracts

3. An account is kept for each contract; on it is registered original cost, variation of cost, amount and date of payments made, rLtention monies, etc. At the end of the contract a reconciliation sheet is prepared for final settlement. This document is reviewed by the controller (see para. 6). A file is attached to each account sheet. It contains a copy of monthly bills, statement of quantities and other financial transactions; thus allowing easy certification of accuracy and authenticity of expenditure. For externally- financed projects, where foreign contribution is expressed in percentage(s) of total cost, the account sheet and supporting documents allow straightforward compilation and control of expenses eligible for loan disbursement. Requests for reimbursement from the external lenders are held rending receipt of payment details from the Ministry of Finance and Plannin;. This, however, does not affect the carrying out of projects because all funds (whether of external or internal origin) are fully budgeted.

(b) Force Account

4. Most maintenance and repair works financed under Title I (recurrent budget) are carried out by force account. Three budgetary headings are directly involved, namely:

Article 60: For materials, spares, fuel, etc. Article 32: For salary of workers Article 30: For overhead costs, including civil servants' salaries

Repairs and maintenance costs of flood protection works have probably been undervalued because of current allocations of expenditures between Titles I and II. However, this is not expected to affect Bank-financed expenditures. The existing detailed cost accounting of expenses under Articles 60 and 32 of Title I makes it possible to trace any expenditures incurred by Title I on behalf of works financed under Title II.

5. The cost accounting referred to above provides detailed information on maintenance, listed by type, performed annually in each territorial sub- division; the accounts also show the quantities of materials used and unit costs. The information provided under the present system is considered adequate to assess whether the requirements set forth in the maintenance program are met. ANNEX 8 - 31 - Page 3

C. Control and Audit Procedures

6. There is a corps of controllers (named "controleurs des Services Publiques") attached to the Prime Minister's office. Controllers are responsible for approval, prior to commitment, of all expenditure financed under Title I and Title II. Controllers are assigned to one of more Ministries and Public Enterprises or Services, but they remain administratively independent from the entity(ies) they control. Approval by the controller is evidenced by a visa on data sheets sent to the computer center, orders of payment to the State Cashier (trésorier-payeur général), bidding documents, award and settlement of contracts, etc. Control is usually based on the availability of budgeted funds for the proposed allocations and the compliance with proce- 4 dures; however, sometimes the review goes so far as judging whether or not the expenditures proposed are appropriate. If a visa is refused, the case may be brought to tbe Prime Minister's office where final decision is taken. At year end the controller prepares a report summarizing the inadequacies in budgetary and financial matters noted during the year. This report is reviewed by the concerned Ministry or the Board of Directors of the interested entity. Cor- rections if necessary are made during preparation of the next budget. How- ever, because of perennial dearth of staff, late or discontinued reporting in the past and the potential risk for these "in house" controllers to have their independence erroded with time, it is not considered that such controls meet Bank's audit requirements.

7. Control functions are also carried out by the "Contrôle Général des Finances" attached to the office of the Minister of Finance and Plannin l/. Specific investigations covering a wide variety of subjects are assigned to the controllers in Ministries, Public Services and State Enterprises. Con- trols are based on compliance with procedures and funds allocation and reporting includes opinion and recommendation on the operating capacity and organization of the controlled entities. Because of their independent position, overall professional competence, and familiarity with budgetary and admini- strative procedures, the "Contrôle Général des Finances" has been accepted by the Bank to carry out the audits of Bank financed projects.

8. Furthermore, controls carried out a posteriori by the "cour des comptes" are done with such delay as to serve little useful purpose from an auditing point of view.

I/ Decree No. 82.7 January 5, 1982 - 32 -

ANNEX 9

TUNISIA

SFAX FLOOD PROTECTION PROJECT

SELECTED DOCUMENTS AVAILABLE IN PROJECT FILE

Ai Disaster Mitigation in Tunisia. Stockholm University, 1976.

A2 Direction de l'Aménagement du Territoire (Ministère de l'Equipement), 1980.

- Cartographie des risques d'inondation. - Cartographie et analyse de vulnerabilité. - Planification urbaine-inondations.

B1 Protection contre les crues de la ville de Sfax. CNR, January 1983.

B2 Protection contre les inondations de Sfax, Sakiet Eddair, Sakiet Ezzit, Jebenana and El Amraa. Direction de l'Hydraulique Urbain, November 1982.

B3 Note sur les Inondations du 30 et 31 octobre 1982 de la Région de Sfax. IBRH, December 1982.

B4 Protection de l'Agglomération de Sfax contre les Inondations. Sogreah, January 1983.

B5 Photographs of 1982 flood.

B6 Assainissement de l'Agglomération de Sfax. Plan Directeur (3 tomes). SOGREAH, 1978.

B7 Evaluation des Dégâts des Inondations du 30 et 31 octobre 1982. Rapport de Synthèse. SOTINFOR, January 1982.

B8 Dégats-inondations 30-31 Octobre 1982. Détails.

B9 Projet de relogement des populations sinistrés. Ministère de l'Habitat, Décembre 1982.

B10 Evaluations des dégats des inondations de 1969, 1973, 1975.

Bll Intensité des Précipitations à Sfax. Institut National de la Météorologie, March 1981.

B12 Ville de Sfax, Pluviométrie (2 tomes). Sogetha, November 1959.

B13 Coupures de Routes (3 tomes). Ministère de l'Equipement, 1974, 1976, l977.

B14 Le Grand Sfax - Evolution Récente - Développement Futur (4 tomes), Dr. Noureddine Karray, June 1982

Cl Staff Working Papers - . - w

\ j - i i te

s_* X~~~~~~~~~~~~~~Bxe EsmZt S / - S~~~~~~~~~~~~~~~~~~~aki(eBd Dair

El \ : r EXFLOCO PROTECTION PROJECT

t 00: 0 = RcHiE$_[l A IUN AND -E5tZIPI { ~~~~~~~~~~orc'ED 0 ;; C 0 ; ; v 4

|ELS

SUEVJTiAS' EPOJES- SOAS IM7 T//S

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