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Multi0page.Pdf Documentof The World Bank FOR OFFICIAL USE ONLY v - /g ~~- {/( U -Cl Public Disclosure Authorized Report No. 10947-CV STAFF APPRAISAL REPORT REPUBLIC OF CAPE VERDE Public Disclosure Authorized TRANSPORT AN@DINFRASTRUCTURE PROJECT FEBRUARY 2, 1993 Public Disclosure Authorized .: 7 .--. V ..vifr -. :I: ':: .: .- - .- :T A J tI I7 Infrastructure Operations Division Public Disclosure Authorized Sahelian Department Africa Region This document has a restricted distribution and may be used by recipients only in the pe-formance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CU,RRENCYEOUIVALENTS Currency unit - Cape Verdean Escudo (CVesc) US$1.0 = 64.89 Special Drawing Rights (ISDR) = UJS$1.404 Special Drawing Rights (ISDR) CVesc 91.11 SYSTEMOF WEIGHTS AND MEASURES Metric System FISCAL YEAR January 1 - December 31 This report is based on the findingsof a World Bankappraisal missionconsisting of Messrs. Michel Loir (Sr. Transport Economist,Mission Leader), MichelAudig6 (Port Engineer), and Victor Fonseca (Highway Consultant). Mrs. Brigitta Mitchell (Principal Transport Economist), and Mr. Pierre Henault (Highway Engineer) contributed to appraisal of the capacity building and highway components. Messrs. Hans Peters and Harald Hansen are the Peer Reviewers. Mr. Peter Watson and Ms. Katherine Marshall are the mar,aging Division Chief and the Department Director, respectively, for this operation. FOROmCIL USEONLY LISTOF ACRONYMS ACP AverageColiection Period ADB African DevelopmentBank ANV National Travel Agency(Agencia National de Vigeans) ASA National 1nterprise for Airports and Air Traffic SOfety(Aeropotos o SegurancaAeres) BADEA Arab Bank for AfricanDevelopment (Banque aabo pour le ddveloppementeconomique an Afrique) CENFA Center for Public AdministrativeTraining CFN Center of NauticalTraining CORD Commissionfor Managementof DecentralizedResources CGTM ShippingManagement Commission CNNAV National ShippingLine CIT Telephoneand CommunicationsCompany (Empre Publica Cormios e Telecommunicaoes) CVesc Cape VerdeanEscudo DCA DevelopmentCredit Agreement DGAC General Directorateof Cvil Aviation DGCPW General Directorateof Constructionand Public Works DGLT General Directorateof Land Transport DGMP General Directorateof Shippingand Ports DGOTA General Directorateof Land Use and Enviroment DGSP General Directorateof Studiesand Planning di%t DeadweightTons EEC EuropeanEconomic Community EMPA Public Shipping Company(Empresa Publica do Abatecintiento) ENACOL National Enterpriseof Fuels and Lubxicants ENAPOR National Port Enterprise(Empress Nacional de Admin io dos Portos) ENM National Nautical Center FAD African DevelopmentFund (Fonds africain de ddvhoppement) FAIMO Labor IntensiveFront FDN National DevelopmentFund GDP Gross DomesticProduct ICB Intrmational CompetitiveBidding IFAP Center for Public Admisttive Training IFH Institute for HousingAssistance KfW (Kreditanstlt fur Wiederaufbia) LCB Local CompetitiveBidding LEC National Laboty of Civil Wors MIT Ministry of Ifrastructure and Tansport PPF Project PreparationFacility SDR SpecialDrawing Rights SOB Statementof Expenditure TACV Republicof Cape Verde Ailines (Tnsportes Aeros de Cabo Verde) TEU Twenty EquivalentUnits TPU Trasport PlanningUnit UNCTAD United Nations Conferce an Trde and Development UNDP United Nations DevelopmentProgram SNM National WeatherService This document has a restricteddistribution and may be used by recipients only in the performance of their officialduties. Its contents may not otherwisebe disclosedwithout World Bankauthorization. REPUBLICOF CAPE VERDE TRANSPORTAND INPRA,STRCTURE EROECT STAFF APPRA1SALREPORT Tabl of CQntnt I. INTRODUCTION .. 1...................I A. CountryBackground .I B. MacroeconomicFramework and Policies .................. ... ... 1..I C. Prospectsof Growth and FinancingRequirements .................... 3 II. TRANSPORTINFRASTRUCTURE AND SECTORISSES . 3 A. Overall Status and Macro-EconomicLinkages ........................ 3 B. The Port Sub-Sector. 4 C. Shipping. 7 D. The Highway Sub-Sector.9 E. Telecommunications.12 F. Airports and Air Transport.13 0. TransportPlanning .13 m. GOVERNMENTTRANSPQRT POLICY AND STRATEGY 14 I. IDA INVOLVEMENTIN TRANSPORTAND INFRASTRUCTURE. 15 A. IDALending Strategy .15 B. Previous IDA Lending for Transport and Lessons Drawn.15 C. Rationalefor IDAInvolvement .16 . THEPROJET .... 16 A. ProjectObjectives . .16 B. Project Description . .17 C. Project Costs . .21 D. LendingArrangements . .22 E. Status of ProjectPreparation . .23 F. ProjectInplementation . .23 G. Project Sustainability . .26 H. Disbursements .. I. Procurement.28 J. EconomicEvaluation .30 K. FinancialEvaluation . .31 L. Accounting, Auditingand Reporting . .32 M. EnvironmentalAspects . 33 N. ProjectRisks ........................... 33 l. A.EMENTS REACHEDAND REOWNDAMON . .34 REPUB3LICOF CAERD TRNSPORT AND IMFASTRU REPROJECT STAFFAPPRAISAL REPORT Tle oLfCntnts ANNEE 1. Unemployed,Active and TotalPopulation 2. ExistingPort Facilities.n PorioGrande, Praia, and Valede Cavaleiros 3. Trafficof Majorand MinorPorts in CapeVerde 4. ENAPORorganization chart 5. ContractPlan for ENAPOR 6. Productivityin the Port of Vale de Cavaleiros 7. Compositionof the NationalMerchant Fleet S. ActionPlan for Modernizationof Shipping 9. RoadNetwork Inventory 10. OrganizationChart of Ministryof Infrastructureand Transport, Directorate of Public Works,and RoadTransport Directorate 11. RoadConstruction and MaintenanceBudgets and ActualExpenditures, 1989-1992 12. PublicWorks Staffing (1990, 1992)and PublicWorks Employment (1990) 13. EstimatedVehicle Fleet, 1990 14. RoadAccident Statistics, 1987-1991 15. EstimatedCosts of RoadWorks Program (1993-1996) 16. DetailedProject Cost Tables 17. Termsof Referenceof the TransportPlanning Unit C1PU) 18. Termsof Referencefor TechnicalAssistance to GeneralDirectorate of PublicWorks 19. Termsof Referencefor TechnicalAssistance to ENAPOR 20. SupervisionPlan 21. PerformanceTargets 22. ImplementationSchedule 23. EconomicEvaluation of the Modernizationof PortoGrande 24. EconomicEvaluation of Constructionof ShelteredPort in Fogo(Vale de Cavaleiros) 25. EconomicEvaluation of the RoadProgram (First Year) 26. ENAPOR- FinancialEvaluation 27. Letterof TransportSector Policy 28. Letterof TeleportSubsector Policy 29. List of Documentsin ProjectPile TRANSPORTAND INFRAST-RUCTUREPOECT STAFF APPRAISALREPORT CRE -ANDPROJECT SUMMRY Boffower: Republicof Cape Verde ImplementingAgency: Ministry of Infrastructure and Transport (MIT), National Port Enterprise (ENAPOR) Creditmont: SDR 8.9 million (US$12.5million equivalent) Terms: StandardIDA terms with 40 years maturity OnlendingTerms: Loan for US$2.9 million to ENAPORat an interest rate of 7.5%, repayable over 20 years including4 years of grace Cofinmcing: Germany, The Netherlands, African DevelopmentFund will contribute the equivalent of US$14.2 million with the Government contributing the equivalent of US$15.6 million. Japan provided US$0.25 million for preparatory studies. At a recent donor's meeting, pledges were received from BADEA (about US$10 million equivalent), OPEC-Fund(about US$5 million equivalent), the French Caisse Centrale (about US$5 million equiWalent),EIB (about US$5 million equivalent), and the Swedish Import Support Program (about US$10 million equivalent per year). .e total of which is sufficientto cover the fundinggap. Project Obectives and De o: The objectives of the project are to: (i) promote the international competitivenessof Cape Verde through port modernization,reorganization of the shippingindustry, and developmentof offshore informationindus' 5s like "teleports"; (ii) foster national economic integration by streamlining sector investmentplanning and achievinga more balanced and cost effective allocationof resources; (iii) prevent further erosionof the capital stock in the road network by setting up a road maintenanceorganization; (iv) support promotionof the local contractingindustry through executionof a four-year road maintenanceprogram; and (v) promote economicgrowth and alleviate poverty in Fogo island through rehabilitationof its only port. Using a sector lending approach, the project has four components:(i) Port Sector Investments,including modernization at Porto Grande in the island of Sao Vicente, and Port Rehabilitationat Vale De Cavaleirosin the island of Fogo; (ii) Reorganizationof Shippingunder an Action Plan to redesign the institutional framework, and provide the right incentives to private shipowners;(iii) HighwaySector Improvement tlwough execution, mainly by ii private contractors,of a time slice of the investmentand maintenance program(1993-1996); (iv) Establishmentof an institutionalframework to developsatellite earth station "teleports" by privateinvestors. SetWo Benefits od Rtsks: Project benefits are expected at two levels: (V) port and shipping modeization, and institutionaldevelopment to strengthenENAPOR and promoteteleport services will enhance Cape Verde's comparative advantage for productionof internationalservices, earning much needed foreign exchangeand generating economies of scalefor nationaltraffic; (ii) improved road conditions,and reorganizedinter-island shipping together with port rehabilitationat Fogo islandwill reduceland transportcosts and domestic freightrates, contributingto better economicintegration of the countryand to alleviationof lingeringpoverty in stillisolated areas. Secondarybenefits consistof boostedeconomic growth and associatedjob creation. Risks: Governmentpolicies are sound and reforms conduciveto
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