Document of The World Bank
FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 11951
PROJECT COMPLETION REPORT
Public Disclosure Authorized MOROCCO
THIRD WATER SUPPLY PROJECT (LOAN 2006-MOR)
JUNE 7, 1993 Public Disclosure Authorized
Infrastructure Operations Division Public Disclosure Authorized Country Department I Middle East and North Africa Regional Office
This document has a restricted distribution and may be used by recipientsonly in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. EXCHANGE RATES
Appraisal Year Average (1980) USD 1 - DH 4.2 Intervening Year Average USD 1 = DH 8.7 Completion Year Average (1990) USD 1 = DH 8.1
WEIGHTS AND MEASURES
Metric Svstem British/US System
1 centimeter (cm) - 0.39 inches (inch) 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 miles (mi) 2 1 square meter (m ) = 10.76 square feet (sq. ft) 2 1 square kilometer (km ) = 0.38 square mile (sq. mi) 1 metric ton (m/ton) = 0.98 long ton (1g. ton) 1 liter (L) = 0.26 gallon (G)
GLOSSARY
AH - Hydraulics Administration (Administration de l'Hydraulique) DRSC - Public Utility Directorate (Direction des Regies et Services Concedes) ONEP - National Water Production Agency (Office Nationale de l'Eau Potable) PERL - Public Enterprise Rationalization Loan RAD - Regie AutonomeIntercommunale de Distributiond'Eau et d'Electricitede Casablanca RADEEF - Regie Autonome de Distribution d'Eau et d'Electricite de Fez RADEEM - R6gie Autonomede Distributiond'Eau et d'Electricitdde Meknes RADEEMA - Rdgie Autonomede Distributiond'Eau et d'Electricitdde Marrakech RADEEN - Rdgie Intercommunaled'Eau et d'Electricite de Nador RADEEO - Regie Autonomede Distributiond'Eau et d'Electricite d'Oujda RADEES - Rdgie AutonomeIntercommunale de Distributiond'Eau et d'Electricitede Safi RADEETA - Regie Autonomede Distributiond'Eau et d'Electricite de Taza RADEEJ - Regie Autonomede Distributiond'Eau et d'Electricite de la Provincede El Jadida RADEEC - Regie Autonomede Distributiond'Eau et d'Electricite de Chaouia(Settat) RADEET - Regie Autonomede Distributiond'Eau et d'Electricite de Tadla RAID - Regic AutonomeIntercommunale de Distributiond'Eau et d'Electricitdde la Province de Tanger RAK - R6gie AutonomeIntercommunale de Distributiond'Eau et d'Electricite de Kenitra RAMSA - Regie AutonomeMultiservices d'Agadir RDE - Rdgie AutonomeIntercommunale de Distributiond'Eau et d'Electricitddo Tetouan RED - Regie AutonomeIntercommunale de Distributiond'Eau et d'Electricite de Rabat-Sale Regie - MunicipalPublic Utility Company UNDP - United NationsDevelopment Program
MOROCCO - FISCAL YEAR
January 1 - December 31 FOR OFFICIAL USE ONLY
THE WORLDBANK Washington,D.C. 20433 U.S.A
Office of Director-General Operations Evaluation June 7, 1993
MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT
SUBJECT: Project Completion Report on Morocco Third Water Supply Prolect (Loan 2006-MOR)
Attached is the report entitled "Project Completion Report on Morocco - Third Water Supply Project (Loan 2006-MOR)" prepared by the Middle East & North Africa Regional Office with Part II contributed by the borrower.
The implementation of this large and unduly complex project took four more years than projected. However, on completion, virtually all objectives were achieved. Physical targets were met or exceeded although the number of house connections for low income consumers was less than projected, due to the high cost of connections. The financial position of the national entity is adequate but cash flow problems remain due to late payment of bills by government agencies. Overall the performance of the project is rated as satisfactory, its sustainability as likely and institutional development as substantial.
The Project Completion Report's coverage and analysis of several important issues, particularly finance, is inadequate. The significant contribution contained in Part II somewhat balances these shortcomings.
An audit of this project is planned.
I Thisdocument has a restricteddistribution and may be used by recipientsonly in the performanceof theirofficial duties. Its contentsmay not otherwisebe disclosedwithout World Bankauthorization.
FOR OFFICIAL USE ONLY PROJECT COMPLETIONREPORT
MOROCCO
THIRD WATER SUPPLY PROJECT
(LOAN 2006-MOR)
Table of Contents
PREFACE .i......
EVALUATION SUMMARY ...... ii
PART I: PROJECT REVIEW FROM THE BANK'S PERSPECTIVE
Project Identity .1...... Project Background ...... 1 Project Objectives and Description ...... 1 Project Design and Organization ...... 2 Project Implementation ...... 3 Results ...... 5 Sustainability...... 7 Bank's Performance ...... 7 Borrower's Performance ...... 8 Project Relationship...... 8 Consultants' Services ...... 9 Project Documentation and Data ...... 9
PART II:PROJECT REVIEW FROM BORROWER'S PERSPECTIVE ...... 10
Office National de l'Eau Potable ...... 10 Direction des R6gies et Services Conced6s ...... 33 Administration de l'Hydraulique ...... 56
PART III:STATISTICAL INFORMATION ...... 67
Table 1: Related Bank Loans ...... 68 Table 2: Project Timetable ...... 69 Table 3: Cumulative Loan Disbursements ...... 70 Table 4: Project Costs ...... 71 Table 5: Project Costs ...... 72 Table 6: Status of Compliance with Covenants ...... 73 Table 7: Missions ...... 75 Table 8: Staff Inputs ...... 76
MAP: IBRD 24486
This document has a restricted distributionand may be used by recipientsonly in the performance of their officialduties. Its contents may not otherwisebe disclosed without World Bankauthorization.
PROJECT COMPLETION REPORT
MOROCCO
THIRD WATER SUPPLY PROJECT
(LOAN 2006-MOR)
PREFACE
This Project Completion Report describes the preparation, appraisal, and implementation of the Third Water Supply Project in Morocco, for which Loan 2006- MOR in the amount of USD 87 million was signed on September 28, 1981 and became effective on March 15, 1982. The original closing date of December 31, 1986 was extended three times to December 31, 1989 because of Morocco's fiscal constraints and the late transfer of loan proceeds from the Government to the executing agencies. An amendment to the Loan Agreement of March 24, 1987 reallocated disbursement percentages and canceled USD 9 million from the loan. The final withdrawal from the loan account was made on May 22, 1990. Ultimately, USD 78 million were disbursed.
The Preface, Evaluation Summary, Parts I and III of the PCR were prepared by the Infrastructure Operations Division of Country Department I, Middle East and North Africa Regional Office on the basis of, inter alia, the Staff Appraisal Report, the Loan and Project Agreements, supervision reports, correspondence between the Bank and the Moroccan authorities, internal Bank memoranda, interviews with former project officers, and completion reports prepared by the Office National de l'Eau Potable (ONEP), Direction des R6gies et Services Conc6des (Ministry of the Interior), and the Administration de l'Hydraulique (Ministry of Public Works and Vocational Training). Part II of this PCR comprises these three separate reports.
ii
PROJECT COMPLETION REPORT
MOROCCO
THIRD WATER SUPPLY PROJECT
(LOAN 2006-MOR)
EVALUATION SUMMARY
Proiect Background and Obiectives
1. In 1980, only 25% of the rural population had access to safe drinking water. Although most of the urban population had access to public water, only 45% had house connections. The Bank's lending strategy for the water supply sector was still essentially geared towards helping the Government resolve major sector issues, shaping a strong institutional framework, and providing urban areas with safe drinking water. After 1980, the Bank shifted its emphasis towards improving the access of low-income urban dwellers to the water distribution system through house connections while expanding water supply in semi-rural and rural areas, where more than half of the population resided.
2. The Third Water Supply Project evolved from a long-standing dialogue on sector development. In the late 1970s, that dialogue began to focus on possible actions with a high social impact following an assessment of service deficits in cities and rural areas. The project thus aimed at providing greatly improved access to safe water for the low-income residents of the largest cities and to the population of the smaller and more remote rural centers bypassed by earlier sector investments. It also sought to continue the institutional development of the national bulk water production agency (ONEP) undertaken by the two previous projects, enhance ONEP's ability to monitor water quality and manage water supply systems, and improve the capability in the sector to plan and prepare investments, particularly in rural areas.
Implementation Exoerience
3. The project was implemented in nine years rather than the five scheduled at appraisal. Over 300 contracts were awarded, including 73 on the basis of international competitive bidding (ICB) mainly for equipment. Both ICB contracts and those awarded on the basis of local competitive bidding (LCB) experienced lengthy delays as sufficient counterpart funds were unavailable because of the country's serious fiscal difficulties and mounting arrears owed to ONEP and the water and electricity distribution companies (R6gies) caused by inadequate water tariffs. There were no significant procurement bottlenecks, but the number and variety of contracts complicated project management and Bank loan disbursements. Although direct payment procedures were introduced and efforts made to set up Special Accounts, late payments to executing agencies, contractors, and suppliers continued.
4. A line of credit allocated to ONEP helped finance the construction of 38 ONEP centers, six more than originally envisaged. Twenty-two of these centers were destined for drinking water production and distribution, and 16 centers solely for drinking water distribution. ONEP also built and equipped two regional water supply systems. The first tranche of the Errachidia-Erfoud-Rissani Regional Water iii
Supply System was completed in 1985 according to schedule, whereas the two other tranches, completed in 1987 and 1989, experienced considerable delays because of lengthy negotiations with the municipalities responsible for water distribution (para. 11). Construction of another regional water supply system for Karia Ba Mohamed began in early 1983. Although operations were launched in March 1985 according to schedule, the system's water treatment plant operations had to be interrupted a number of times because of the high turbidity of the Sebou river during the rainy season. This required the construction of pre-settling facilities at the treatment plant.
5. The municipally-owned R6gies, under the tutelage of the Ministry of the Interior, and ONEP carried out a social house connection program. Implementation of this component by both the Regies and ONEP got off to a good start and was generally successful despite lengthy delays in the transfer of disbursed amounts from the Ministry of Finance accounts to the Regies and ONEP. By 1985, four Regies included in the project had fully utilized their Bank loan amount allocations. In response to requests from RED (Rabat-Sale) and RADEEMA (Marrakech), loan proceeds were reallocated in 1987 and again in 1989 to enable them to continue their more ambitious social house connection programs. By the end of project implementation, both the Regies and ONEP exceeded their original targets.
6. The Hydraulico Administration (AH) within the Ministry of Public Works, in coordination with ONEP, oversaw the drilling and equipping of 21 boreholes and 19 wells at 15 ONEP centers for carrying out pumping tests and determining the exploitable yield. This component was completed two years behind schedule, in mid- 1985, because of unforeseen delays in drilling boreholes.
7. Studies financed under the project were successfully carried out for: (a) the identification, selection, design, operation, and maintenance of water supply systems in rural areas; and (b) an updated and enlarged water supply master plan for the mid-Atlantic coastal region. A third study aimed at improving the organization of the water supply sector was not completed. Work on this study could not start until AH had finished a rural drinking water supply master plan financed by the United Nations Development Program. Therefore, it has recently been decided that recommendations on institutional changes in the sector to integrate water production and distribution in urban rural areas, as envisaged, will be part of a sector study on water resources planned for FY95.
Results
8. The proportion of the population with water supply connections increased from 48% in 1981 to 65% in 1989. By the end of 1989, ONEP had installed 36,639 connections for the low-income population, or 115% of the original target. By the end of 1989, the Regies had installed 92,659 social connections, or 105% of the original target. In the Errachidia-Erfoud-Rissani region, some 262,000 rural inhabitants in 237 villages are being supplied with safe drinking water through 1,524 house connections and 250 standpipes, and in Karia Ba Mohamed, some 72,000 through 892 connections (815 private, 40 public, and 36 industrial connections, and 1 standpipe).
8ustainabilitv
9. The Third Water Supply Project followed on the main objectives of the first two projects by helping ONEP to focus on improved efficiency under an increasingly decentralized organizational structure. As a result of improved efficiency, ONEP's iv permanent staff increased by only 9% between 1981 and 1989 compared with a twofold increase in water sales for that period. The agency's training policy focussed on skill upgrading of managers and basic training to accommodate the needs of new technicians. Now that a reasonably viable institution exists on the production side, sustainability will rest on addressing the following major issues confronting the sector: (a) further development of ONEP's distribution capacity in small villages; (b) institutional and operational strengthening of the Regies leading to full managerial and financial autonomy; (c) setting of water tariffs that are adequate to attain full cost recovery in the sector; and (d) settling of mounting arrears owed to ONEP and the R6gies and prevention of the buildup of more arrears in the future. These objectives have been supported by the Public Enterprise Rationalization Loan (PERL) and the National Water Supply Rehabilitation Project and are the goals of the proposed Fifth Water Supply Project, to be appraised in early 1993.
Conclusions and Lessons Learned
10. Clearly, project complexity contributed to the lengthy implementation delays. There were many executing agencies (ONEP, the Regies, and AH) and a wide variety of components, including rural water supply and master plan studies. The number of contracts (over 300) further complicated project implementation and monitoring. The lessons are that: (a) the more complex the project, the greater the likelihood of lengthy delays in execution; and (b) overly optimistic implementation periods for complex projects should be avoided.
11. Completion of the Errachidia-Erfoud-Rissani regional water supply system experienced considerable delays due to the innovative nature of the subproject, time required for land expropriation, the local population's lack of ownership and commitment, and time required for separate water distribution agreements to ensure maintenance of public fountains in seven rural communes. The agreements were finalized in 1988 rather than in 1982, as initially planned. Moreover, water consumption in Errachidia-Erfoud was well below original targets (2 liters per capita per day instead of the planned 40 liters per capita per day) because public taps were not being used to the extent envisaged. The lesson is that some issues (e.g., sociological implications) should have been taken into account in the project design, other issues (e.g., action plan for land expropriation) should have been addressed during project preparation, and other delays (e.g., water distribution agreements with local communities) might have been avoided at the onset of project implementation had the participants been adequately informed of the legal aspects of the project and its conditionalities during the project launch seminar. The preparation of the proposed Fifth Water Supply Project includes an important social component designed on the basis of demand and capacity analyses pertaining to future water customers in rural areas.
12. Loan conditionalities focussed on ONEP's working and debt service coverage ratios and did not take into account its growing investments. During negotiations, it was agreed that ONEP would be required to maintain a working ratio in the order of 65% for 1982 and thereafter. During the 1980s, ONEP's working ratio showed continuous improvement, reaching by 1984 the covenanted 65% in the Loan Agreement and in 1988 55%, its lowest level before rising to 65% in 1992. By 1990, ONEP's equity exceeded 80% of its liabilities, allowing for a positive working capital. During the project period, its debt to debt-and-equity ratio never exceeded 25% of its capital. Nonetheless, ONEP's financial contribution to investments v deteriorated between 1987 and 1990 despite efforts under the PERL and the National Water Supply Rehabilitation Project. Towards the end of the extended project implementation period, the Government and ONEP signed a performance contract, as a condition of the PERL, specifying their respective obligations in terms of tariff levels, operating ratios, Ministry of Finance control over investments, and the Government's contribution to the investment program. At the same time, under the National Water Supply Rehabilitation Project, the working ratio covenant was changed to a cash generation covenant with a view to improving ONEP's financial performance under its heavy investment program. The lesson is that financial covenants for utilities were not successfully designed and that a working ratio (excluding depreciation) is not a valid indicator; either an operating ratio (including depreciation) or a cash generation ratio is an acceptable measure of a utility's financial performance.
13. The Bank was successful in garnering the participation of three R6gies (RAD, RED, and RAK) in the social house connection program under the Second Water Supply Project and in expanding the number of participating Regies under the Third Project. The Bank was less successful in helping the R6gies improve their financial position or operations and maintenance. At the time of project inception, it was not deemed necessary for the Bank and the Regies to enter into formal project agreements in view of the minor scope of works involved in installing house connections. However, in retrospect, it might have been wise to have included several Regies as full partners since the serious financial and managerial constraints on Rogie operations, in general, have intensified over the years and must again be resolved some 12 years later through the Fifth Water Supply Project. The lesson is that the earlier institutional and financial issues are dealt with, the better the Government and the Bank can envisage overall sector development.
14. Although AH performed well in the execution of its investigations of water resources, it was unable to avoid the considerable delays in implementing water resource master plan studies because of the participation of multiple institutions in the provision of data and discussion of reports and recommendations. The lesson is that water resource studies are politically sensitive in arid and semi-arid countries and by nature complex, and they require the input of many institutions in water supply, irrigation, and power. They can only be completed in a satisfactory way by identifying relevant institutions at an early stage, setting up an appropriate incentive structure, and creating a permanent coordination panel at the national level.
15. Project design relied heavily on ONEP's growing institutional capacity. A valuable lesson was learned from the successful testing of ONEP's capability to select and appraise subprojects financed through a line of credit. In addition, Bank support to the Social House Connections Fund in three projects has been so successful that under the Fifth Project, another replenishment will be made. Achievements under the Third Water Supply Project were indeed substantial in terms of the incremental population served, the number of new connections, and the sustainability of objectives, particularly in view of ONEP's enhanced managerial capacity. However, in the latter implementation years, a "2" rating was assigned to the "development impact" of the project. Whereas a "3" rating would have been more indicative of ONEP's financial performance, a consistently high rating for development impact would have been fully acceptable. The lesson is that the assignment of project ratings needs to be given appropriate attention. PROJECT COMPLETION REPORT
MOROCCO
THIRD WATER SUPPLY PROJECT
(LOAN 2006-MOR)
PART I: PROJECT REVIEW FROM THE BANK'S PERSPECTIVE
1. Proiect Identity
Name : Third Water Supply Project
Loan Number : 2006-MOR
Loan Amount : USD 87 million
RVP Unit : Middle East and North Africa
Country : Morocco
Sector : Water Supply and Sewerage
Subsector : Water Supply
2. Project BackQround
2.01 By 1980, Morocco's population was approximately 20 million, with about 9.3 million, or 47%, living in the urban areas. Overall growth in population had been at 3% p.a. for the last five years, but was expected to decrease to 2.6% over the next ten years. Whereas the rural population was increasing at 1.8% p.a., the urban population was growing at about 4.8% p.a. In rural areas, only 25% of the population had access to safe drinking water. Most of the urban population had access to public water, but only 45% had house connections.
2.02 Before 1980, the Bank's lending strategy for the water supply sector had been essentially geared towards helping the Government resolve major sector issues, shaping a strong institutional framework, and providing urban areas with safe drinking water. After 1980, Bank shifted its emphasis towards improving the access of low-income urban dwellers to the distribution system through house connections while expanding water supply in semi-rural and rural areas, where more than half of the population resided. The Third Water Supply Project grew out of an ongoing dialogue on sector development involving the Bank, the Moroccan Government, and the Office National d'Eau Potable (ONEP). The dialogue focussed on possible actions with a high social impact following an assessment of service deficits in smaller towns and rural areas. - 2-
3. Proiect Oblectives and Description
3.01 Protect Obiectives. The project aimed at providing greatly improved access to safe water for the low-income residents of the cities and to the population of the smaller and more remote centers bypassed by earlier sector investments. It also sought to continue the institutional development of ONEP undertaken by the two previous projects, enhance ONEP's ability to monitor water quality and manage water supply systems, and improve the capability in the sector to develop water resources and to plan and prepare investments, particularly in rural areas.
3.02 Proiect Description. The original project components were:
(a) a line of credit for the financing of subprojects consisting of the expansion and upgrading of about 32 water supply systems;
(b) construction of, and equipment for, the Errachidia-Erfoud-Rissani and Karia Ba Mohamed regional water supply systems;
(c) acquisition of laboratory and related equipment for four water quality control laboratories, water meters, including calibrated test meters, leak detection equipment, and maintenance and survey equipment;
(d) technical assistance in the design and calculation of distribution networks, preparation of final designs and bid documents, setting up a management information system, improving the operation of water systems, and completing the inventory of ONEP's assets;
(e) training of laboratory staff in appropriate water treatment and control techniques;
(f) social house connection program for low-income customers of ONEP and the public utility companies (Regies) of Casablanca (RAD), F6s (RADEEF), Kenitra (RAX), Oujda (RADEEO), Marrakech (RADEEMA), Meknes (RADEEM), Rabat-Sal6 (RED), Safi (RADEES), Tanger (RAID), Taza (RADEETA), and Tetouan (RDE);
(g) construction of, and equipment for, boreholes and wells in 24 centers for carrying out pumping tests and determining the exploitable yield; and
(h) studies for: (i) the identification, selection, design, operation, and maintenance of water supply systems in rural areas; (ii) an updated and enlarged master plan, drawn up originally for the Mid-Atlantic Coastal Zone between Kenitra and Casablanca, and extended to the year 2010 for meeting the water demand of the Mid-Atlantic Coastal Zone from Safi to Kenitra, including the preparation of final designs and bid documents for the first phase construction program, and (iii) improvements in the organization of the water supply sector.
4. Proiect Design and Organization
4.01 Prior to project appraisal, ONEP prepared the initial reports needed to identify and resolve issues relating to tariff adjustments and preliminary designs for civil works of varying magnitude and at sites throughout the country. The agency also provided data for defining the different project components. These reports were reviewed by the Bank and served as the basis for appraising the project. The project was then designed with a view giving ONEP the opportunity to sharpen its project preparation and appraisal capacity through a line of credit. The Bank appraisal mission assessed ONEP's management, its overall investment program, as well as its approach, criteria, appraisal techniques, and design characteristics used in subproject selection. ONEP would carry out a master plan study for the mid-Atlantic region, while the studies on regional water supply systems and sector organization would be entrusted to another entity.
4.02 The Public Utility Directorate (DRSC) within the Ministry of the Interior collected relevant data from the Regies on the requirements for increasing the house connections of low-income customers. Installation of house connections to new low-income customers of the Regies would be carried by the R6gies themselves. Organization and implementation of works drew upon the experience gained by the Regies under the Second Water Supply Project.
4.03 The Hydraulic Administration (AH) within the Ministry of Public Works and Vocational Training was charged with carrying out the water resource development component in coordination with ONEP. It would also provide a rural drinking water master plan needed to complete the sector organization study.
5. Proiect Implementation
5.01 General. The project was implemented in nine years rather than the five scheduled at appraisal. Clearly, project complexity contributed to the delays. There were many executing agencies (ONEP, the Regies, and AH) and a wide variety of components, including a line of credit, social house connection funds, rural water supply, and master plan studies. The number of contracts further complicated project implementation and monitoring. Over 300 contracts were awarded, including 73 on the basis of international competitive bidding (ICB) mainly for equipment. Both ICB and those awarded on the basis of local competitive bidding (LCB) experienced lengthy delays as there were insufficient counterpart funds available because of Morocco's fiscal difficulties and mounting arrears owed to ONEP and the Regies, the consequence of inadequate water tariffs. Although there were no significant procurement bottlenecks, the number and variety of contracts complicated project management and Bank loan disbursements.
5.02 Civil Works. This component, partially financed by a Bank line of credit in the amount of USD 10 million, supported the construction of 38 ONEP centers, six more than originally envisaged. Twenty-two of these centers were destined for drinking water production and distribution, and 16 centers solely for drinking water distribution. The list of eligible centers was amended several times with the result that a total of 43 centers were appraised. In January 1981, the Beni Mellal, Fquih Ben Salah, and Kasba Tadla centers were transferred to the local Regie (RADEET). On the other hand, additional centers were included under the line of credit because water resources in the Taznakht, Tinghir, Sidi Allal Tazi, Midelt, Goulmima, and Missour centers were insufficient. Because of these additional centers, execution of works, originally scheduled for completion by mid-1988, was not completed until late 1989. However, by the end of 1985, the original component completion date, works for 33 centers were either completed or underway. Eleven centers for production - 4 - and distribution and four for distribution only were completed, two for production and distribution and three distribution only were nearing completion, and two for production and distribution and 11 for distribution only had been contracted out.
5.03 Errachidia-Erfoud-Rissani Regional Water Supply System. The water transport pipes were installed in three tranches, comprising: (a) setup of the main water transport pipe for water supply of Errachidia and Erfoud; (b) the installation of the water transport pipe for the supply of Rissani by the Erfoud system; and (c) supply for villages in the Ziz Valley and the Tafilalet Lowlands. The first tranche was completed in 1985 according to schedule, whereas the two other tranches, completed respectively in 1987 and 1989, experienced considerable delays due to the innovative nature of the project, time required for land expropriation, time required for separate water distribution agreements to ensure maintenance of public fountains in seven rural communes, and the local population's lack of ownership and commitment to the project. The agreements were finalized in 1988 rather than in 1982, as initially planned. Water consumption was well below original targets (2 liters per capita per day instead of the planned 40 liters per capita per day) because public taps were not being used to the extent envisaged. The lesson learned is that some issues (e.g., sociological implications) should have been taken into account in the project design, other issues (e.g., action plan for land expropriation) should have been resolved during project preparation, and other delays (e.g., water distribution agreements with local communities) might have been avoided at the onset of project implementation had the participants been adequately informed of the legal aspects of the project and its conditionalities during the project launch seminar.
5.04 Karia Ba Mohamed Regional Water SuDplV System. Construction of the regional water supply system began in early 1983 and operations were launched in March 1985 according to schedule. However, the system's water treatment plant operations had to be interrupted a number of times because of the high turbidity of the Sebou river during the rainy season. This required the construction of pre-settling facilities at the water treatment plant. In addition, the water distribution system was expanded to allow for service to the villages located along the water transport pipes linking the Karia Ba Mohamed treatment plan with the distribution network. Works for these additional sections started in October 1988 and were completed in May 1990.
5.05 Social House Connection Program. Implementation of this component by ONEP and the Regies got off to a good start and was generally successful despite initial delays of up to eight months in reimbursing R6gies for materials and equipment. Part of this delay resulted from cumbersome administrative procedures, part from inefficiency. Subsequent delays could be attributed to urban rehabilitation projects that were lagging behind schedule. Between 1982 and 1985, ONEP installed 36,380 connections, out of an estimated 42,000. However, only 40% of these connections were for the lower-income segments of the population, mainly because of the reluctance of the rural population to borrow for house connections. It was decided to extend the implementation deadline so that the entire social house connection program could be carried out. In November 1983, the Loan Agreement was amended to extend participation to other Regies. An increase in family income ceiling and an active campaign by DRSC to promote the installation sped up the implementation of this program. By 1985, four Regies had fully utilized their Bank loan amount allocations. In response - 5 -
to requests from RED (Rabat-Sale) and later from both RED and RADEEMA (Marrakech), loan proceeds were reallocated from RAD (Casablanca) in 1986 and again in 1989 to enable RED and RADEEMA to continue their more ambitious social house connection programs.
5.06 Water Resource Development. AH, in coordination with ONEP, oversaw the drilling and equipping of 21 boreholes and 19 wells at 15 ONEP centers for carrying out pumping tests and determining the exploitable yield. This component was completed two years behind schedule, in mid-1985, because of unforeseen delays in drilling boreholes.
5.07 Rural Water SurPlv Systems Study. Moroccan authorities, with the assistance of the World Health Organization and funding from the United Nations Development Program (UNDP), launched in 1990 a rural water supply master plan study dealing primarily with water supply for dispersed rural population. The concurrent Bank-financed study of regional water supply systems was geared more to agglomerated populations and limited to the province of Ouarzazate and some 30 smaller rural agglomerations. The study experienced some delays when discussions with the Rural Infrastructure Directorate of the Ministry of Agriculture and Agrarian Reform became bogged down.
5.08 Water Supplv Master Plan Study. The updating and extension of the drinking water supply master plan for the region located between Kenitra and Safi was completed on schedule in early 1986. The study recommended the installation of a pipeline between the Oum Er R'bia River and Casablanca. The cost of the first phase of the project was estimated at USD 78 million. The Saudi and Kuwaiti funds financed the foreign exchange component for this phase, and service began in 1991.
5.09 Water Supnlv Sector Organization Study. The Ministry of Economic Affairs entrusted ONEP with lead responsibility for implementing the first phase, which consisted of updating and revising the 1975/1976 tariff study. This was completed in 1983. The second phase was never undertaken. It was to have made recommendations on institutional changes in the sector to integrate water production and distribution in urban and rural areas. Work on this study could not start until AH had finished a rural drinking water supply master plan. Therefore, it has recently been decided that recommendations on institutional changes will be part of a sector study on water resources planned for FY95 (para. 10.02).
6. Results
6.01 Proiect Costs. The actual project cost was USD 137 million compared with USD 169 million estimated at appraisal resulting in a 19% underrun. This difference is attributable to devaluation of the Moroccan dirham by 50% in relation to the US dollar. Lower final costs for some components, e.g., less external assistance used by ONEP than initially planned, easily offset higher costs for others, such as an increase in the number of centers financed under the sector loan, the need to construction pre-settling facilities at the Karia Ba Mohamed water treatment plant, and acquisition of equipment for additional ONEP centers. 6.02 Disbursements. Disbursements consistently remained well behind forecast amounts (30% in the early 1980s), partly because of the delays in project startup and partly because of lengthy delays in the transfer of disbursed amounts from the Ministry of Finance accounts to the R6gies and ONEP. A new procedure of direct payment by the Treasury to the R6gies' accounts was introduced in 1985. Efforts were also made to set up Special Accounts. Nonetheless, payments to executing agencies, contractors, and suppliers continued to be late. By the first closing date, December 31, 1986, only 35% of the loan amount had been disbursed. By the fourth and final closing date, December 31, 1989, over 1,100 separate withdrawals from the loan account had been made, with an average withdrawal of about USD 67,000.
6.03 Achievement of Physical Targets. The proportion of the population with water supply connections increased from 45% in 1980 to 65% in 1989. By the end of 1989, ONEP had installed 36,639 connections for the low-income population, or 115% of the original target, and the Regies 92,659 social connections, or 105% of the original target. In the Errachidia-Erfoud-Rissani region, some 262,000 rural inhabitants in 237 villages were supplied with safe drinking water through 1,524 house connections and 250 standpipes, and in Karia Ba Mohamed, some 72,000 were supplied through 892 connections (815 private, 40 public, and 36 industrial connections, and 1 standpipe). However, water consumption in Errachidia-Erfoud- Rissani was well below original targets (2 liters per capita per day instead of the planned 40 liters per capita per day); public taps were not being used to the extent envisaged because the sociological implications had not been taken into account in the project design. The preparation of the proposed Fifth Water Supply Project, to be appraised in early 1993, includes an important social component designed on the basis of demand and capacity analyses pertaining to future water customers in rural areas.
6.04 Economic Justification. The proposed regional water supply subprojects represented the least-cost solutions based on discount rates from 8% to 12% for providing the population in the project areas with adequate safe water. Subprojects refinanced under the line of credit were subject to least-cost alternative eligibility criteria applied by ONEP. Reevaluated economic rates of return are unavailable because ONEP now needs to develop criteria for ex-post project evaluation. Since ONEP did not reach projected sales in the regional projects, economic rates of return for Errachidia-Erfoud-Rissani and Karia Ba Mohamed waterworks were lower than foreseen.
6.05 Financial Performance. Loan conditionalities focussed on ONEP's working and debt service coverage ratios and did not take into account its growing investments. During negotiations, it was agreed that ONEP would be required to maintain a working ratio in the order of 65% for 1982 and thereafter. During the 1980s, ONEP's working ratio showed continuous improvement, reaching by 1984 the covenanted 65% in the Loan Agreement and in 1988 55%, its lowest level before rising to 65% in 1992. By 1990, ONEP's equity exceeded 80% of its liabilities, allowing for a positive working capital. During the project period, its debt to debt-and-equity ratio never exceeded 25% of its capital. Nonetheless, ONEP's financial contribution to investments deteriorated between 1987 and 1990 despite efforts under the PERL and the National Water Supply Rehabilitation Project. Towards the end of the extended project implementation period, the Government and ONEP signed a performance contract, as a condition of the PERL, specifying their respective obligations in terms of tariff levels, operating ratios, Ministry of - 7 -
Finance control over investments, and the Government's contribution to the investment program. At the same time, under the National Water Supply Rehabilitation Project, the working ratio covenant was changed to a cash generation covenant with a view to improving ONEP's financial performance under its heavy investment program.
6.06 Environmental Impact. The project had nothing but a positive impact on the environment by contributing to improved environmental health conditions. The provision of water distribution systems replaced wells in rural areas contaminated by seepage from septic tanks and pits; sewerage connections in urban areas and septic tanks in rural areas were made compulsory for project beneficiaries. The installation of better designed standpipes with adequate drainage reduced levels of stagnant water, while greater numbers of low-income urban and rural dwellers, as well as livestock, had access to safe drinking water. There was no adverse effect on wetlands or biodiversity, nor was resettlement necessary.
7. Sustainabilitv
7.01 The Third Water Supply Project followed on the main objectives of the first two projects by helping ONEP to focus on improved efficiency under an increasingly decentralized organizational structure. As a result of improved efficiency, ONEP's permanent staff increased by only 9% between 1981 and 1989 compared with a twofold increase in water sales for that period. The agency's training policy focussed on skill upgrading of managers and basic training to accommodate the needs of new technicians. Now that a reasonably viable institution exists on the production side, sustainability will rest on addressing the following major issues confronting the sector: (a) further development of ONEP's distribution capacity in small villages; (b) institutional and operational strengthening of the Regies leading to full managerial and financial autonomy; (c) setting of water tariffs that are adequate to attain full cost recovery in the sector; and (d) settling of mounting arrears owed to ONEP and the R6gies and prevention of the buildup of more arrears in the future. These objectives have been supported by PERL and the National Water Supply Rehabilitation Project and are the goals of the proposed Fifth Water Supply Project.
8. Bank Performance
8.01 The Bank was instrumental in improving relations among sector institutions and initiating and following up on discussions of sensitive issues such as arrears, tariffs, division of responsibility, inter-agency collaboration, and water rights. It also continued to assist ONEP in upgrading its management systems and cost accounting with a view to improving investment planning procedures. Particular attention was given to ONEP's financial management capacity as conditionalities focussed on its working and debt service coverage ratios. The lesson learned that the Borrower with Bank assistance can achieve financial objectives by complying with covenants geared to particular circumstances. Another lesson was learned from the willingness of the Bank to test ONEP's capability to select and appraise subprojects financed under a line of credit, which was highly successful.
8.02 The Bank was successful in garnering the participation of three R6gies (RAD, RED, and RAK) in the social house connection program under the Second Water -8-
Supply Project and in expanding the number of participating R6gies under the Third Project. The Bank was less successful in helping the Regies improve their financial position or operations and maintenance. At the time of project inception, it was not deemed necessary for the Bank and the R6gies to enter into formal project agreements in view of the minor scope of works involved in installing house connections. However, in retrospect, it might have been wise to have included several Regies as full partners since the serious financial and managerial constraints on Regie operations, in general, have intensified over the years and must again be resolved some 12 years later through the Fifth Water Supply Project. The lesson is that the earlier institutional and financial issues are dealt with, the better the Government and the Bank can envisage overall sector development.
9. Borrower Performance
9.01 ONEP performed competently, proving that it could benefit from a line of credit. It also increased its experience in building rural water supply systems. RED (Rabat-Sale) continued to stand out in achieving its targets for social house connections while all R6gies except RAD (Casablanca) and RAK (Kenitra) made significant progress. AH performed well in the execution of its investigations for water resources but was unable to avoid the considerable delays in implementing master plan studies because of the participation of multiple institutions in the provision of data and discussion of reports and recommendations. The lesson learned is that water resource studies are politically sensitive in arid and semi-arid countries and by nature complex, and they require the input of many institutions in water supply, irrigation, and power. They can only be completed in a satisfactory way by identifying relevant institutions at an early stage, setting up an appropriate incentive structure, and creating a permanent coordination panel at the national level.
10. Proiect Relationship
10.01 The Bank continued to foster the close relationships it had forged with ONEP and AH under the first two projects. Since ONEP had already developed into a competent institution in the field of water supply production, the success in expanding the social house connection program under the Third Project allowed the Bank to begin to focus on the Regies, which became the rationale for the ongoing National Water Supply Rehabilitation Project. Closer ties between the Bank and the Regies under the National Water Supply Rehabilitation Project has culminated in a serious dialogue on future Bank financial support for their managerial and financial restructuring and eventual full autonomy, which will be the main focus of the Fifth Water Supply Project.
10.02 The relations between ONEP and AH were further strengthened, whereas ONEP and the R6gies still need to rationalize their responsibilities for water resource management in some regions of the country. In fact, because of the recent drought and increased demand for drinking and irrigation water, there is an urgent need in Morocco for comprehensive water resource development planning including environmental planning and management at the national level. The Government acknowledges that a rational approach to water resource management is critical to the country's overall development and that continued participation of the Bank is needed as a development catalyst, both at the micro level for water distribution and at the macro level to assist in addressing intra-sectorial - 9 - issues. The upcoming (FY95) water resource management study will analyze and recommend solutions to longer-term problems related to the scattered responsibility for water resource management and lack of economic criteria for resource allocation among competing demands for agriculture, industry, and human consumption. It is envisaged that the study's recommendations and allocation procedures will then be carried out through a follow-on Water Resource Management Project, scheduled for FY96.
11. Consultants' Services
11.01 The consultants engaged by ONEP on behalf of the Government for the rural water supply systems study, am well as those engaged by AH, performed satisfactorily. In addition, ONEP set up a cost accounting system with the assistance of a consultant recruited through UNDP. His services were fully satisfactory.
12. Proiect Documentation and Data
12.01 Documentation and data contained in the Bank's files were generally adequate insofar as the components implemented by ONEP were concerned, whereas information on AH's implementation experience in carrying out the water resource development component was scant and the quantitative results of the social house connection program implemented by the Regies were missing. The completion report submitted by ONEP furnished supplemental information, and those submitted by DRSC and AH adequately bridged informational gaps.
- 10 -
MOROCCO
THIRD WATER SUPPLY PROJECT (Loan 2006-MOR)
PART II: PROJECT REVIEW FROM
BORROWER'S PERSPECTIVE
OFFICE NATIONALDE L'EAU POTABLE
- 11 -
OFFICE NATIONAL DE L'EAU POTABLE THIRD WATER SUPPLY PROJECT (LOAN 2006-MOR)
Project Completion Report
Table of Contents
I. Introduction
II. Project Preparation and Appraisal
1. Background 2. Project Objectives 3. Project Description
III. Project Implementation
1. Startup 2. Implementation Schedule 3. Procurement 4. Costs and Disbursement
IV. Results of Operation
1. Project Role 2. Project Results
V. Financial Results
VI. Institutional Results
1. Organizational Development 2. Staff Development and Training Policy
VII. Summary
Annexes (see following page) - 12 -
Annexes
1. Project Implementation Schedule
2. Estimated and Final Project Cost
3. Cost per Project Component
4. Project Cost per Category
5. Inventory of Withdrawals by Category/year
6. List of the Centers Affected by Social Connections
7. List of the Centers Affected by the Sector Loan
8. ONEP - Actual and Planned Operating Account, 1981-1989
9. ONEP - Actual and Planned Operating Account, 1981-1989
10. Organizational Structure - 13 -
MOROCCO THIRD WATER SUPPLY PROJECT (Loan 2006-MOR)
GENERAL INFORMATION
Country: Kingdom of Morocco
Project Beneficiary: Office National de l'Eau Potable
Monetary Unit: Dirham
1981 US$1 = DHS 4.20 1989 US$1 = DHS 8.14
Fiscal Year: January 1 to December 31
- 14 -
MOROCCO THIRD WATER SUPPLY PROJECT (Loan 2006-MOR)
I. INTRODUCTION
This report describes the appraisal, implementation, and completion of the ONEP component financed by the Third Water Supply Project of the World Bank (Loan 2006-MOR).
The original loan amount was USD 87 million, of which USD 45.76 million were allocated to ONEP. The loan was signed on September 28. Its initial closing date was December 31, 1986, which was extended three times, i.e., to December 31, 1987; December 31, 1988; and December 31, 1989.
During project implementation and upon ONEP's request, the initial loan amount was reduced from USD 45.76 million to USD 30.49 million. The final amount disbursed to ONEP was USD 30.44 million.
II. PROJECT PREPARATION AND APPRAISAL
1,. Background
Prior to the Third Water Supply Project, the World Bank financed two other water supply projects:
* The first project focused on the first tranche of the Bou-Regreg conveying complex, which supplies potable water to the area between Kenitra and Casablanca on the Atlantic coast. ONEP was the project executing agency.
* The second project focused on the second tranche of the above project, for the potable water supply of Greater Agadir, as well as on the installation of potable water connections for low-income populations in the three cities of the Kingdom. Project execution agencies were ONEP and the water supply distribution agencies of Kenitra, Rabat-Sale, and Casablanca.
* The third project was identified by the World Bank in collaboration with the Moroccan authorities. This project continued the development of the potable water sector and potable water connections and targeted the low- income population. The Hydraulics Administration, water supply distribution agencies, the Ministry of Agriculture and Agriculture Reform, as well as ONEP participated in project preparation. - 15 -
2. Proiect Oblectives
The project focused on a number of priorities in the potable water sector in order to
* facilitate low-income population connections to the public potable water supply system;
* construct two regional supply systems and 32 smaller production and distribution centers to increase water supply, and improve ONEP's activities in project planning, evaluation, implementation, and maintenance;
* enhance ONEP's main laboratory by equipping its regional laboratory, creating a water quality control network that could be developed throughout the Kingdom;
* assist ONEP in strengthening its institutional capacity; and
* examine the organization of the water supply sector to improve investment planning procedures.
3. Prolect Description
ONEP's project components include the following:
3.1 Provision of 37,650 potable water connections for the low-income population in smaller centers within ONEP's jurisdiction. The operation's goal was to increase the population's potable water supply from 45% to 65% in 1985. According to this plan, households who wished to be connected to the public water supply system and who complied with World Bank eligibility requirements were granted easier payment options.
3.2 Improvement of the production and water supply distribution system in smaller ONEP centers. Thirty-two centers were initially selected, according to criteria set forth by the World Bank.
3.3 Construction of two main water supply transport systems described below:
* the Errachidia-Erfoud-Rissani water supply transport system at 320 1/s, which supplies not only the above regions but also the rural populations of the Ziz Valley and the Tafilalet Lowland;
* the Karia Ba Mohamed water supply transport system at 30 1/s, which supplies the city as well as the rural population living along the water transport pipe.
The laying of these main transport pipes allowed ONEP to obtain first-hand experience in the rural water supply.
3.4 Acquisition of equipment for four regional laboratories to improve control of water quality, research equipment, and leak detection so that water production and distribution facilities could be appropriately maintained and water meters be purchased. - 16 -
3.5 Technical assistance to ONEP and professional training to
* improve the design and calculation of water distribution networks and the preparation of detailed studies and bidding documents;
* establish an improved cost-accounting system;
* complete the inventory of ONEP's fixed assets; and
* familiarize laboratory staff with appropriate water treatment and control methods.
3.6 Realization of two studies, namely
* the study on the updating and extension of the potable water supply master plan for the region between Kenitra and Casablanca on the Atlantic Coast (to be extended from Kenitra to Safi), as well as on the preparation of detailed projects and bidding documents for the first stage of the construction program; and
* the sector study on the reorganization of the potable water supply sector.
III. PROJECT IMPLEMENTATION
1. Startup
The loan agreement was signed in September 1981. According to the initial project schedule, works should have started in early 1982 and be completed in late 1985.
There were no particular problems in launching the works:
* in 1981, for the centers financed by the sector loan; * in May 1982, for the connections for low-income population; * in January 1983, for the regional water supply transport system of Karia Ba Mohamed; and * in October 1983, for the regional water supply transport system of Errachidia-Erfoud-Rissani.
Despite the fact that project works started on schedule, completion was delayed for the following reasons:
* the list of centers financed by the sector loan was modified, and * the water supply transport system of Errachidia-Erfoud-Rissani was complex in nature.
2. Implementation Schedule
Initial and actual implementation schedules are compared in Annex 1 and explained hereafter. - 17 -
2.1 Connections for Low-Income Population
By the end of 1985, the target goal of 37,650 individual connections to the water supply system had to be achieved. Since some ONEP centers were retransferred to RADEET (Beni Mellal, F.B. Saleh, and Tadla) in January 1981, however, ONEP installed only 31,750 connections. From 1982 to 1985, the ONEP had to install another 9,500 standard connections. Therefore, a total of 41,000 connections were installed, representing:
* 80% of connections for the low-income population, and * 20% of standard connections.
The total number of water supply connections increased from 48% in 1981 to 65% in 1985, improving the overall water supply.
By the end of 1985, ONEP installed:
* 14,520 connections for low-income populations, representing 46% of the target (31,750), and
i 21,860 standard connections representing 230% of the target (9,500).
Taking all connections installed between 1982 and 1985 into account, 36,380, or 90% of the planned total were put into place, and by late 1985, the supply rate reached 60%, approaching the initial target.
The overall goal was achieved within the planned time frame, even though only 40% (instead of the planned 80%) of all the connections were for the low- income population. This reflects the population's willingness to pay cash for being connected to the water supply network.
In view of the beneficial aspects of connections for the low-income population and for water savings, it was decided to extend the implementation deadline in order to carry out the entire program. Thus, at the end of 1989, 36,639 connections for the low-income population, or 115% of the target were installed.
Annex 4 shows the list of participating centers.
2.2 Sector Loan
In order to improve the production and supply of potable water, it was initially planned to establish 32 centers. By the end of 1985, the status of the works was as follows:
* the works for 15 centers, 11 of which were designed for production and distribution, were completed (more than 50% of the total);
* the works for 5 centers, 2 of which were designed for production and distribution, were being completed (about 16% of the total); and
* the works for 13 centers, of which 2 were designed for production and distribution, were contracted out (about 40% of the total). - 18 -
It should be mentioned that the original list of centers had to be modified for the following reasons:
* In January 1981, the Beni Mellal, Fquih Ben Salah and Kasba Tadla centers were transferred to RADEET, the Beni Mellal agency.
* Water resources at the Taznakht, Tinghir, Sidi Allal Tazi, Midelt, Goulmima, and Missour centers were insufficient.
The final list includes 38 centers, of which
* 22 centers are destined for drinking water production and distribution; and
* 16 centers are destined solely for drinking water distribution.
The works for all the centers were completed by late 1989 (see list of centers affected by the sector loan in Annex 5).
2.3 Reaional Water Transport Pipes
2.3.1 Errachidia-Erfoud-Rissani
Considering the drilling test results, the flow rate reached 200 1/s instead of the initially planned 320 1/s. Two additional drillings had to be carried out to satisfy the planned flow rate.
The water transport pipes were installed in three sections:
* The first section entailed the laying of the main water transport pipe based on the Erfoud dwellings for water supply of the Errachidia and Erfoud centers. Works for this tranche started in October 1983, and operations began in October 1985.
* The second tranche entailed the installation of the water transport pipe for the supply of Rissani by Erfoud. Works for this tranche started in June 1986 and were completed in July 1987.
* The third tranche entailed supply for Ksours (the rural villages) in the Ziz Valley and the Tafilalet Lowlands. Works for this tranche started in January 1988 and were completed in August 1989.
In addition, the water supply networks of Errachidia, Erfoud, and Rissani were extended.
The first tranche was completed according to schedule, while construction of the two others were considerably delayed for the following reasons:
* project complexity and the fact that it was ONEP's first experience in rural water supply; - 19 -
* it was necessary to cross through palm groves in order to service Ksours, which required a considerable amount of time for land expropriation;
* the definition of project management made it necessary for more time to be allocated to the study, which concluded that seven water supply agreements should be arranged with seven rural communes, requiring the services of a caretaker to manage the standpipes. These agreements were finalized in 1988 rather than 1982, as initially planned.
The project has reached its objectives: in addition to the urban centers, 237 Ksours were supplied with 250 standpipes. By the year 2000, 262,000 inhabitants should benefit from this project.
2.3.2 Karia Ba Mohamed
Construction of the water treatment center on the Sebou river (30 1/s output) began in early 1983, and operations were launched in March 1985. The project could be realized with a slight delay. However, it should be noted that during initial operations, the station had to be closed a number of times as the Sebou river was exposed to unexpected currents during the rainy season. Pre-settling was necessary in order to maintain the MES flow at 2 g/l. In addition, the water supply distribution system was expanded to allow for service of the villages located along the water transport pipe linking the treatment center with the Karia Ba Mohamed station. Completion of these additional sections was delayed because works did not start until October 1988 and were completed in May 1990.
2.4 Acauisition of Miscellaneous Eauipment
There were no particular problems with the purchase of equipment. For this project component, the following 67 contracts for a total of DH 29 million were concluded:
i maintenance material: 49 contracts of DH 16,259,000 * laboratory material: 8 contracts of DH 2,382,588 * technical material: 6 contracts of DH 2,787,000 * water meter equipment: 4 contracts of DH 7,602,000
2.5 Technical Assistance
Due to the exorbitant price for consultancy, ONEP did not solicit external assistance as initially planned, but carried out the tasks through its own means:
* With the assistance of a consultant recruited through PNUD-OMS for short-term missions, a cost-accounting system was set up and which became operational in January 1987.
* Fixed assets for which inventory was completed in 1989 were reconciled.
2.6 Studies
The study on the updating and extension of the potable water supply master plan for the region located between Kenitra and Safi was completed on - 20 -
schedule. Its results concluded that, in the first stage, Casablanca should be supplied similar to Oum Erbia. The respective project was ongoing and service was supposed to start in early 1991.
Within the framework of the present project, the study on the organization of the potable water sector could not be carried out, as all required conditions (according to the definition of a rural potable water supply master plan) could not be satisfied. The study was delayed, and should be undertaken within the framework of the National Water Supply Rehabilitation Project (Loan 2825-MOR).
3. Procurement
In this project, 323 contracts were concluded, 73 of which were launched through international competitive bidding (ICB), totalling DH 214 million, or 40% of the total project cost.
It should be mentioned that ICB contracts require long delays and bid packages do not always attract foreign enterprises. As a result, only a few foreign enterprises participated in project realization. Project management was also difficult, as the final contracts varied in nature.
4. Costs and Disbursements
The table in Annex 3 presents the positive and negative differentials between planned and actual costs for each project category.
The positive differentials apply mainly to the "connections for the low- income population" and "technical assistance" categories, because technical assistance was not provided as planned (para. 2.5), and material for the center was not delivered for the connections for the low-income population.
The negative differentials apply to the "sector loan" and "regional water transport pipes" components as the number of centers increased from 32 to 38 on the sector loan list, and the water distribution centers and pre-settling facilities of the Karia Ba Mohamed treatment station were expanded for regional water transport pipes.
The total project cost amounts to DH 527 million, exceeding the initial estimated project cost of DH 434 million by 20%.
The disbursement cycle was influenced by project completion delays. Only 46% of the loan proceeds were disbursed on June 30, 1986, the initial loan closing date, which had to be postponed three times. During the first semester of 1990, the final withdrawal of funds took place.
It should be mentioned that the actual amount withdrawn was only S30.44 million. In fact, by ONEP request, part of the loan was cancelled (with a revaluation of the US dollar) to decrease the loan amount from $45.76 million to $30.49 million (Annex 1: Disbursements).
IV. PROJECT RESULTS
The main project objectives were reached as the results were rather satisfying. - 21 -
ONEP was able to implement the planned program for the most important project element: water connections for the low-income population. By 1985, 90% of all connections were set up, 60% of the population were supplied with potable water. Between 1985 and 1989, additional connections were installed and the supply rate reached 115%, which represents a distinctive improvement in water supply.
As for the Errachidia-Erfoud water transport pipe, 262,000 inhabitants were serviced through special connections and 250 standpipes in 237 Ksours. Hence, water supply in this region was considerably improved.
The same positive results apply to the Karia Ba Mohamed center. Due to this project, the center's output exceeds demand during peak periods and obtains a 76%-efficiency rate. In December 1989, 892 connections (815 private, 40 public, and 36 industrial connections, and 1 standpipe) supplied 7,200 inhabitants with water.
V. FINANCIAL RESULTS
Annex 6 shows ONEP's working accounts (specifying the amount of water sold), corresponding receipts and expenditures) for the fiscal years 1981-1989.
Throughout the entire decade, the gross working ratio has shown continuous improvement; by 1984, it surpassed the ceiling stipulated in the loan agreement. Due to the annual tariff increases set forth by the Government, ONEP's receipts have increased and the ratio has dropped below 66%, reaching its lowest level of 55% in 1988.
It should be mentioned that in 1981, ONEP was not granted the DH 5 million working subsidy, envisaged during project appraisal.
(ONEP's balance sheet is given in Annex 7).
Given ONEP's activities, major installations are needed, such as treatment center, pumping station, etc.; its assets are composed of more than 70% in fixed assets and less than 30% in current assets for the expense account. The latter one indicates that payments of arrears owed by agencies, administrations, and municipalities have been substantial.
Despite actions taken within the project on the public enterprise reform loan to alleviate debt, the problem still persists.
Capital assets exceed 80% of ONEP's liabilities, allowing for a positive working capital. In addition, ONEP's debt ratio throughout the decade was very satisfactory, as it did not exceed 25% of its capital assets. The Agency's debt carrying capacity is, therefore, considerable.
VI. INSTITUTIONAL RESULTS
1. Development of the Organization
As ONEP focussed on improved efficiency, its organizational structure became increasingly decentralized. Since 1981, major developments have occurred to facilitate the completion of all tasks. Annex 8 shows the organizational structure. - 22 -
2. Staff Development and Training Policy
ONEP's permanent staff increased by barely 9% from 2,993 in 1981 to 3,276 in 1989.
In addition, ONEP's training policy focussed on training existing staff in order to increase management efficiency and improve the quality of the service.
It should be noted that prior to project startup and throughout its initial phase, ONEP concentrated on basic training to accommodate the needs of new technicians.
Since 1983, ONEP has offered a program of continuing education in order to
* familiarize its staff with their tasks (through methodical, short-term courses in modular format);
* improve the knowledge of its administrative staff (through medium- and long-term training, which provides access to promotion);
* inform and sensitize professionals and technicians concerning current problems and new methods (through short-term courses and seminars).
Since ONEP has increased its productivity by 50% between 1981 and 1989, the above policy appears to be an effective one.
VII. CONCLUSION
The project has, in general, reached its objectives.
The "connections for the low-income population" program was achieved, and improved potable water supply for the low-income population considerably.
Since 1987, ONEP has used a standard cost-accounting system. Inventory of the Agency's fixed assets was completed in 1989.
However, the water sector organizational study could not be implemented within the scope of this project, as all the conditions for such a study could not be satisfied. Therefore, this study will be carried out within the framework of the National Water Supply Project. TIIRD WATER PROJECT
LOAN 2006-MOR
IMPLEMENTATION SCHEDULE
______1981 1982 1983 | 1984 | 1985 1 1986 | 1987 | 1988 | 1989
1. Sector Loanl PeasibilityStudies ______
Appraisal (ONEP)
Detailed prajct and bidding documents - -
Procuranat ______
l Implementation ______
2. Regioal WaterSupply System 2-1. Karia Da Moanmed Daailed project ad bidding document _ _ _
. Procurmant ____
Implementation - - - - - _ - Pipeline andStation - Villages and sludge removal
2-2. Erchidia Erfoud Ddaild Pioject and Bidding documents _
* Procurement
- 1st Phas - 2nd and 3rd Phases
3. Community Connections …_
4. Study on Coastal Ar-e
(-) Planned Implemenation (__) Actual Implcmentation - 24 - Annex 2
ESTIMATED AND FINAL PROJECT COST (ONEP PART)
ESTIMATED ITEM COST FINAL COST DIFFERENCE (1) (2) (2-1) 1. SectoralLoan 156.3 237.77 81.24 2. RegionalConveyance - Errachidia-Erfoud 150.32 176.70 26.38 - Karia Ba Mohamed 7.97 26.45 18.48 3. EquipmentMaterial - Meters 7.72 7.60 (0.12) - Laboratories 3.45 2.35 (1.10) - TechnicalMaintenance 5.85 19.08 13.23 4. TechnicalAssistance 6.90 2.56 (4.34) 5. Studies 5.66 11.17 5.51 6. Training 1.40 0.44 (0.96) 7. Social House Connections 88.33 43.23 (45.10 Total 434.13 527.35 93,22 COST BY PROJECT COMPONENT
COMPONENTS COST PAYMENT SCHEDULE
INITIAL FINAL 1981-1985 1986 1987 1988 1989 June 1990 End 1990 1. Social House Connections 43.226 14.122 6.817 6.494 9.054 6.739 - -
2. Sector Loan 237.769 81.020 42.320 20.180 53.940 29.324 6.194 4.791 3. Regional Conveyance . Errachidia-Erfoud 176.694 71.074 25.051 9.050 44.838 23.261 2.392 1.028 . Karia da Mohamed 26.453 15.127 .588 1.938 6.150 1.127 1.523
4. Acquisitionof misc. matenal 29.035 5.408 10.394 4.480 4.407 2.474 .827 1.045 5. Studies and Technical Assistance 13.733 5.16 1.019 1.650 2.350 1.469 1.013 1.072 Total 526.910 191.911 86.189 41.854 1652 69.417 11 553 9.459 PROJECT COST BY CATEGORY
COST PAYMENT SCHEDULE CATEGORIES INITIAL FINAL 1981-1985 1986 1987 1988 1989 June 1990 End 1990
1. Civil Works . Sector Loan 200.533 68.297 36.461 16.535 49.628 23.830 3.120 2.120 . Errachidia-Erfoud 168.773 66.150 24.528 7.600 44.459 23.093 2.021 .922 | Karia Ba Mohamed 20.759 9.477 .544 1.938 6.150 1.127 1.523 2. Equipment Sector Loan 37.236 12.723 5.859 3.645 4.312 5.494 3.074 2.129 Errachidia-Erfoud 5.236 2.639 .385 1.392 .379 .168 .167 .106 Karia Ba Mohamed 5.694 5.650 .44 3. Acquisitionof Misc. Material 29.035 5.408 10.394 4.480 4.407 2.474 .827 1.045 4. Studies and Technical Assistance 13.733 5.160 1.019 1.650 2.350 1.469 1.013 1.072 + Studies Errachidia 2.685 2.285 .138 .58 _ .204
5. Sub-ContractedWorks 31.142 9.918 4.383 5.344 5.738 5.759 - -
6. Material for Social Connections 12.084 4.204 2.434 1.150 3.316 .980 - - TOTAL 526.910 191.911 86,189 41.854 116.527 69.417 11.553 9.459
I - 27 - Anmexs
INVENTORYOF WITHDRAWALSFROM LOAN 2006 BY CATEGORY/YEAR
CATEGO- TOTAL AMT. CATEG. I CATEG. II CATEG. III CATEG. CATEG. VI CATEG. RIES OF CIVIL EQUIPMENT MISC. IV SOCIAL VII WITHDRAWALS WORKS EQUIPMENT STUDIES CONNEC- MATERIAL TRAINING TIONS/B.S. FOR B.S. YEARS 1983 1146006.68 358810.84 227787.67 0.00 118497.47 411563.57 29347.13 1984 3243680.83 2358998.75 150688.21 5472.56 108548.50 467514.12 152458.69 1985 5108863.66 3653369.13 785055.76 7897.44 197790.87 360844.74 103905.72 1986 4564183.08 2582713.25 1323039.65 192384.85 57648.02 245608.34 162788.97 1987 2790348.35 1840232.70 578926.49 20288.05 60550.24 230890.41 59460.46 1988 4841151.87 3225070.88 724549.32 16029.33 206319.87 596564.67 72617.80 1989 4769415.68 3616772.28 454726.50 190852.24 169393.41 289106.21 48565.04 1990 3974121.81 2244733.71 546870.49 524830.11 275609.48 233695.46 148382.56 Total 30437771.96 19880701.54 4791644.09 957754.58 1194357.86 2835787.52 777526.37_ - 28- Annex 6
LIST OF CENTERS AFFECTED BY SOCIAL CONNECTIONS
NO. OF SC NO. OF SC CENTERS ACHIEVED CENTERS ACIIIEVED
1. TADOURANTE 1100 MAAZIZ 122 BIOUGRA 354 TIDDERS 62 GUELMIME 1540 OULMES 97 TIZNIT 110 ARBAOUA 71 OULED TAIMA 602 AIN AOUDA 122 TATA 377 IIAD KOURT 7 TALIOUINE 11 SIDI IFNI 69 TAGIIJUT 1
2. OURZAZATE 1165 5. IMOUZZER 170 EL KALAA 2357 GUERCIF 408 BEN GUERIR 2341 MISSOUR 634 IMIN TANOUTE 407 TAOUNATE 330 CHICHAOUA 697 R. EL KHEIR 41 ZAGORA 695 MLY YACOUB 114 BOUMALEN DADES 278 AL HOCEIMA 62 SIDI RAIIAL 144 IMZOUREN 16 SIDI BOUATMANE 79 TISSA 66 AGDZ 116 MATMATA 14 TINGIIIR 215 BOULMANE 3 TAZNAKIIT 25
3. BEN SLIMANE 995 6. EL AIOUN 819 EL GARA 235 BERKANE 1571 BOUJAAD 1764 TAOURIRT 1174 BERRECIIID 1548 AHFIR 91 BEN AHMED 281 SAIDIA 80 OUED ZEM 1214 A.B. MATHAR 312 AZILAL 41 DEBDOU 134 DEMNATE 48 NAIMA 21 BOUZNIKA 59
4. KHEMISSET 2270 7. BOUFEKRANE 73 TIFLET 658 EL IIAJEB 299 OUEZZANE 1679 AZROU 666 SIDI KACEM 219 IFRANE 22 S. SLIMANE 638 MIDELT 597 SK.EL ARBAA 322 ERRACHIDIA 982 BEL KSIRI 614 GOULMIMA 222 SIDI YAHIA 51 ERFOUD 325 ROMMANI 93 S. AIOUNE 11 KHENIFRA 1072 RISSANI 217 RICII 181 AOUTOUS I AMALOU 18
TOTAL 1 25412 TOTAL 2 11227
TOTAL 36639 - 29 - Annex 7
LIST OF CENTERS AFFECTED BY SECTOR LOAN
PLANNED CENTERS AT TIME OF CENTERS AFFECTED PROVINCES APPRAISAL BY IMPLEMENTATION REMOVED CENTERS ADDED CENTERS
AGADIR BIOUGRA BIOUGRA TAROUDANT TAROUDANT OULED TAIMA OULED KAIMA OURZAZAT TAZNAKT TAZNAKT TINGHIR TINGHIR OURZAZAT OURZAZAT ZAGORA ZAGORA GUELMIM GUELMIM MARRAKECH IMIN TANOUT TMIN TANOUT CHICHAOUA CHICHAOUA EL KALAA EL KALAA EL KALAA BEN GUERIR BEN GUERIR DENI MELL BENI MELLAL BENI MELLAL F.B. SALEH F. D. SALEH K.TADLA K. TADLA AZIZAL AZIZAL BEN SLIMANE BEN SLIMANE SErTAT EL GARA BEN AHMED BEN AHMED BERRECHID BERRECHID EL GARA BOUJAAD BOUJAAD OUED ZEM OUED ZEM KENITR.A SIDI YAHIA SIDI YAHIA S.A. TAZI S. SLIMANE S.A. TAZI S. SLIMANE S. KACEM S. KACEM OUAZZANE OUAZZANE AIN OUDA AIN AOUDA KHEMISSET KHEMISSET TIFLET TIPLET FES MY YACOUB MY YACOUB TAZA GUERCIF GUERCIF MATMATA MATMATA R. KHEIR R. KHEIR TAOUNATE TAOUNATE TAOUNATE OUJDA TAOURIRTE TAOURIRTE NAIMA MAIMA AIN B. MATHAR AIN.B.MATHAR EL AYOUN EL AYOUN BERKANE BEKRANE IFRAME FRAME IFRANE AZROU AZROU A. TAOUJDATE A. TAOUJDATE EL HAJEB EL HAJEB KHENIFRA MIDELT MIDELT KHENIFRA KHENIFRA ERRACHIDI GOULMIMA GOULMElA BOULMANE MISSOUR MISSOUR
TOTALOF NO. ~321 39 9 6 ;CENTERS--X : ONEP- ACTUALAND PLANNED OPERATING ACCOUNT (1981-1989)
FIa Yeou fndin Decembe 31 1961 19t2 los3 1964 1996 1966 1967 1U 190 rPdlud A1 ia Planned AG" rImed ACtua Plumed AtW Planned Aita Panned Actal Pnd Ahtuml Plned Atual Planed Acual
Produced %w Vaukm 24.00 28e30 30.00 210.20 364.0 3a.80 434.00 36.10 474.00 378.60 608.00 364.10 670.00 41600 43.90 47.80 Grow WVal Sale 16.0 19640 244.8o 220.20 312o 2z66.e 60.00 29630 360.30 SWO.10 424.10 81u.50 477.70 301.00 3203zo eal WAeR sae 26.80 3.20 30.50 31.00 32.60 8330 34.60 29.50 41.00 30.30 4360 31.90 4.0 34.60 366.0 40.60
ow Wit ad. 106.76 58.e0 166.43 121.00 21&3.0 164.80 265.6 248.90 306.65 304.e0 351.06 348o0 421.18 422.00 506.20 537.60 eta Wagr sales 25.60 26.40 31.97 28.o 36.13 36.30 40.84 40.30 6t.=0 4s.00 58.7 64.0 7A.48 63.70 7.40 79.80
Trgl WalerBe]. 134.65 11L620 17.40 147.60 248.73 1.10 806.70 29620 36.06 863.60 406.67 403.20 488.04 485.70 686.00 617.40
Othw 5x? 76.7 12.70 12865 16.40 16.76 17.50 24.07 17.50 26.70 17.50 15.26 19.00 19.61 19.20 27.20 26.ao ou. kiccm 2.31 e.60 2.4 10.90 3.az 13.0 8.67 10.50 4.70 16L.o 504 23ao 5.43 24.10 23.0 26.30 O1 Operadng sub.tda AbD 80 5.00 6.00 0.00 5.00 0.00 6.00 0.00 .0 0.00 6.0 0.00 3.o0 0.00 0.00 0.00 Incenina nlekrdtubdildbt /O.U8) 0 (O.64) 0 t2) 0 (0.82) 0 (1.0m a (1.183 0 (.36) 0 0 0 - Toa _, 140.06 140.40 207S8 178,10 274.06 221.70 338.42 =&60 M.35 367.60 433.96 446.60 81723 629.00 63640 670.50
OPERAMa EXPEiOMAE
Staf 563 64.20 67.87 74.30 74.00 s0.30 62.26 6.8 01.78 93.90 100.61 106.90 111.26 117.5 130.90 140.900 Enery end Fuel 27.70 37.30 35-03 66.50 4.7 76t0 56.15 8.80 60.7t 96.00 6z76 07.80 102.76 110.43 121.60 138.40 Chim la Pp.64g 10.47 166O 15.27 13.o 27.6 1.30 35.73 13.80 42.67 14.30 51.60 15.80s 8.e6 1e.e0 1e60 z620 MaUeta NW Mlailenance 16.63 17.10 21.01 17.40 25.69 13.60 41.06 18.50 46.6 11.40 44.66 16.60 61.2 21.60 24.70 28.20 Genera and Amnistagtie Cost. 7.as 0.30 8.96 19.70 10.20 10.80 11.16 15.6 12.43 21.00 13.6 2za30 1a14 26.1O 33.10 33.30 Oiwr Expendgur. 0.00 11.00 0.00 10.00 0.00 0.00 0.00 0.00 0.00 0.0 0.00 0.00 0.00 0.00 4.50 S.40 Taxse.A0ar SW. end other Tans 0.63 e.10 13.43 11.o 18.3e 16.0 23.50 2020 27.07 24.30 26.36 30.30 33.01 3S.00 4.10 45.30 La" Accrued Eiap0ndfture (17.6n 2a.7) t2as6) (31.2) (26.942 64.6) (3727 (3242) (41.24 (6) (31.46) (34.7) (37.31) (025) (27.4) (0.6)
Pulia Total 110.U6 141.10 141.49 170.70 178.72 13.10 214.81 217.20 24e65 237.40 290.12 267.80 342.6 304.60 848.60 30.10 Anmwllzae 33.13 47.20 35.1S 67.90 .6694 6630 61.65 127.10 68.7 13.10 0.45 140.00 09.71 167.00 213.50 204.60
Toal Op gt* kinom 144.01 168.30 179.86 226.80 234.65 276.30 229 341.30 338.66 37mu0 386867 416.0 442.37 401.60 52W 800.6 Nolt Opeabi bicn (km) 4.04 (47.9) 27.80 (836) 39.39 (57.6 42.83 0.) 53.70 14.00 48.41 20.70 74.66 67.40 74.40 70.90 bt 20.71 130 30.383 82.20 32 .10 41.06 40.0 40.06 8370 61.60 62.30 47.66 6e79 O68.40 ee.8
Ml tIno .eee}) (18.77) (04.2 z.5) (75.7) 0.13 ($6.7) 0.67 (70. 1278 (40.7) (3.19) (52.5) 27.31 (16.3) (11.00) (15.7e) eabocailn at TaNMiawr Sale.
Io onlpenemd tar been hI ftjacl Corne 218 0.00 23.31 0.00 27.47 0.50 6.1 0.00 S3U 0.00 42.48 6.00 4648 0.00 0.00 0.00 LoeneadEiaadbimPt 0 (12.4) 0 (3) 0 (.) 0 (13.2 0 (12.7) 0 ta8) 0 (13-3) g4) (12.1) Not hco lbosseee)terAdjueenent 86 (t7ae) 20.78 (8z2o.) 7.8 (A.4) 3sU (634) 49.06 (24) 30.3 (60.3) 7373 (0.) (11.4I) (7.86)
Opwad Rab h 9 74* 100% M8A 979 06 579 am 6m 84e6* 81* 07% 60* 86* 6* e 5866 6M o ONEP - ACTUAL AND PROJECTED OPERATING ACCOUNI (1981-1989)
F Yew D.ownIW 31 1911 1961 1562 1962 1362 16 1364 1364 196 196 1s" Is" 1117 1? 1MS 1o6 196 1o" Prand AGta Plmeed Ahta Plunned AoSA Plerted Mmd P i_l AActul Plsrmd MAid Pbnned AId Plmnsd Aclud PlmeId Actuml
NetAsets 1,32Z.6 1,2569.0 1,9190.5 1,574. 2,777.66 2,4410 3,121.0 2,66 2m3727n 6,43.70 ,568.50 3,621.50 3,60346 4,118.80 4,394.00 4*664.60 Lo" 66,unue 306.2 366.6 416.36 464.70 40162 672.30 674.80 79.36 65.8 35.00 76.02 1,317.30 666.75 1,241.00 1.576b 1,5f25.e
Asset934.13 6.70 1,4666 1,1365 2,24a67 713 2,64L46 2,12340 2,70.21 2.4370 2,62546 2,73160 2,944.75 2,787O 301A.00 3e4860
W.k h Ptou 675,69 279.70 8600s 616.30 166.6 638.8 146 524.60 176.75 63.70 660.75 26830 1,174.21 606L10 7o6 66o0
Total Amss 1,310.02 1,14Z40 206317 1,754.60 2,443.23 2,231.2 2,691.36 2,646.00 2,s6L1 26.40 ,477.23 3,001.10 4,116.97 3,161.e0 3,684.60 4,061.80 Exleg. raw. dk 0.00 ooo 0.00 7m.00 0.00 130.70 0.00 154.40 0O. 2101.60 0.00 20.60 0.0 23Z00 234.60 206.70 TreaswyNobe 0.00 0.00 0.00 6.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 207.20 187.60 Shars 23.02 27.10 22.10 27.70 23.60 S389 26.40 36.6e0 26 39.60 26.00 3230 26.40 38S0 37Z0 41.70 Oebh_Mm.t 139.32 177.0 144.36 z2eo 146.66 674.30 164.90 721.70 1.6 670.00 106.39 916.70 17241 604.00 64.70 61640 I,dudh COoeldso 0.00 0.00 4.70 0.00 27.76 0.00 60.61 0.00 66.3 0.00 63.96 0.00 79.81 0.00 0.00 0.00 waSable Ad equtudent 1L10 68.60 6.00 6.10 8.07 136.30 6.6 91.0 8.1 11.70 11.7 162.70 14.15 261.30 306.90 2S.60
Total all" 174.4 21.60 160.33 644.0 206.0 1,04450 247.10 652.0 264.50 1.0.60 39,66 1,131.70 236.47 1,100.60 994.60 1.162zo
Not Totd 1484.46 1,43420 z243650 2,17.20 2646.24 3,474.40 2,84364 2,3S64 3,170.41 4,066.70 3,79t 4,36420 4.414.44 4,614.60 5,121.20 6,6Z70 ------L As"ls and LUb*de Owl Coel,do 3S4.72 904.60 1,425.77 1,483.0 1,60314 2,36210 1,81.69 24230 Z,068O6 2,73,0 22.41 2,70A.40 2,7.36 Z371.10 3,246.70 3,677.60 1 Gov Oarnt.pas by Treasy Notes 0.00 0.00 0.00 0.00 0.00 0.00 260.00 260.00 6ubsotuers' ooelteudo. 1144 64.60 41.00 78.60 6S9.6 $S.IO 6.0 11370 116.70 173.90 1365 196.30 161.14 108.O 261.00 301.00 Plus reVade" 164.44 154.40 164.44 164.4 154.44 154.4 18444 14.0 15440 1 0 164.44 U4A.40 164,1.44 1s5 14.40 143004810 Gainsposse.) (1160) (177.1) (117.66) P41) (117.4) r"074 (116.6) (421.0) (104.13) (4"SA.4) (107.32) (536.6) (50.01) (569.2 (O.5) (M064)
Nettod s 1,2.65 1,036.60 1,507.71 1,470.70 1,76. 2,9o0 z,0026 639,40 z 2,38a70 N,1SI9 zn763.60 2,14.9S Z761.90 ,313.10 3*,Z10
Longterm U.b645 Los 213.50 201,40 309.01 =22.S0 660.30 411.00 436.30 490 440.86 467.00 411.76 821.00 371.64 646.0 56O 523.o Outf Lo. S2" 0.00 219.16 37.00 273.72 231 27J.64 2.00 2MS97 3910 414.38 6o. 6o." 416.40 434.30 466.30
Total Ubde to LT. 20136 201.40 526.19 a66.30 66O2 645,10 71814 7660 707.66 73.10 825.1 S916 967.60 61.40 9197.30 s7s.30
P e 187.69 167.90 2e0.44 6.60) 77.AS S215O 167.16 547 190.76 660 2441 487.0 2966 716. 71240 840.70 thOuWS Ub s 8.67 ,30 7.16 10.40 16.73 12.60 24.9 16.o 48.2 17.10 47.21 164.70 46e 67.0 90.40 110.50
Tdod o CoIs Ceoba 164.55 1620 207.60 42 16.24 534.3 2 66A 226 570.60 361.62 e 1.10 341.61 601.60 610.60 961.30
Totl of ms mod 6.556.1,464.46 1,434.20 2,243.O0 21176.0 O,6424 3,474.40 2,64646 3,64.6O 3,170.4 4,066.70 3,70.91 4,2654.10a 4,414,44 4,514.6 6,121.2 6,611170I
PAM ad btlo Om.29 0.16 0.2s 02 0.27 6.2 0.26 0,24 6.24 0.25 024 2 04 0.23 0.2111 - 32 -An 10 ORGANIZATIONAL STRUCTURE
General | Director I
-_- ______----- water ,GeneraL IAuditinc !------l---Inspection Control I DepartmentI l ______I ___ ~I I * ~~~~~~~~I I , __ j _ _ ~ ~~I _*__I___nt Planning I ----- :Acct. ' " Internal Division i liDivisiohn'Auditing
'Management I ! kControL 1 I--.-- _ _ lOrganization 5
!secretary' !Mission GeneraL Staff ------
I - ~~~~~I------I ------I[
lAtlantic I !Operations iEquipmentl lAdminist.j IFinancial i ICoastDepti !Department !Departmeret IDepartmentl I& Computer ------'------Systems ! ~~~~~I.I I1 ,_J -- - -I .Major IProduct I I Studies I jGeneral 1 IFinanciaI jProductionl !Division I I DivisionlIAffairs 1 IDivisioni IDivision I------!------' Division I ------!Mainte- Works II_ -Account. 'Major i nance Dii,.' Division! 'Training -Division lDeveLopmenl 1------I --- _--_I IDivision ! IDivision I IDistrib. I Topogra-! jComputer !------! IDivision !phic & I -iivision I __J ! Land ! lAdminist.I - i- 17 Regio- I Division! IDivision Inal Div. ------I_ _ _
- 33 -
MOROCCO
THIRD WATER SUPPLY PROJECT (Loan 2006-MOR)
PART II: PROJECT REVIEWFROM
BORROWER'S PERSPECTIVE
DIRECTION DES REGIES ET SERVICES CONCEDES
- 34 -
TABLE OF CONTENTS
SUMMARY
I. BACKGROUND
1.01 Borrower'sPresentation 1.02 Sector Organization 1.03 Previous Bank Loans to the Sector 1.04 Bank Objectivesfor the Sector
II. PREPARATIONAND ANALYSIS OF THE THIRD WATER SUPPLY PROJECT
2.01 Project Origin 2.02 Preparation and Appraisal (a) Preparation (b) Appraisal 2.03 Project Objectivesand Goals 2.04 Project Description
III. PROJECT IMPLEMENTATION- PROJECT COST AND OPERATION
3.01 Effectivenessand Startup (a) Effectiveness (b) Startup 3.02 ImplementationExperience 3.03 ImplementationSchedule 3.04 Procurement 3.05 Project Costs and Disbursement 3.06 Sources of Financing 3.07 Project Financing (a) Bank (b) FEC
IV. SOCIO-ECONOMIC PERFORMANCE
4.01 Social Performance 4.02 Economic Performance
- 35 -
PROJECT COMPLETION REPORT
KINGDOM OF MOROCCO
THIRD WATER SUPPLY PROJECT
(Loan 2006-HOR)
SUMMARY
This Project Completion Report presents the preparation, appraisal and implementation of the Third Water Supply Project in Morocco, financed by the 2006-MOR Loan in the amount of USD 87 million. The loan was signed on September 28, 1981 and became effective in July 1982. The closing date, originally foreseen for December 31, 1985, was extended twice, first at the end of 1987, and finally at the end of 1989.
The loan amount intended for the Social House Connection component, was not only fully disbursed (USD 38.15 million) but was exceeded by USD 3.93 million, i.e., for a total amount of USD 42.08 million. The project successfully reached its physical achievements, as the number of connections installed, i.e. 92,659, exceeded the estimates (88,700) by 5%.
This report was prepared by the Public Utility Directorate (Direction des Regies et Services Concedes) within the Financial Division of the Ministry of Interior. The report is based on data provided by the R6gies concerned.
- 36 -
I. BACKGROUND
1.01 Borrower's Presentation. The Kingdom of Morocco is situated at the Northwestern part of the African continent. It is bound by the Mediterranean Sea to the north, Mauritania to the south, Algeria to the east, and the Atlantic Ocean to the west.
Water is scarce in Morocco, and only 6 percent of the exploited resources are currently used for domestic and industrial consumption, as well as for agriculture. The drinking water sector is, in fact, one of Morocco's priorities in its social and economic development policy.
1.02 Sector Oraanization. The Hydraulics Administration of the Public Works Ministry is in charge of water resources study and development. It is also responsible for the operation, maintenance, and monitoring of dams. It allocates water resources according to consumption needs, pending the final decision of a Special Commission under the Prime Minister's Office.
Many entities are responsible for water production and distribution of water in urban, semi-rural, and rural areas. The main production agency is the Office National de l'Eau Potable (ONEP). ONEP is responsible for water production and transport in urban centers, as well as its distribution in some urban and rural centers. ONEP handles about 80 percent of water national production, i.e., 520 million ms (1990), and its share of distribution is 13.10 percent (1990), serving about 241,000 consumers.
Sixteen municipal water distribution companies (Regies) distribute water in 27 towns, inhabited by over 75 percent of the urban and semi-rural population. These R6gies provide their own production estimated at 130 million of mi3 , i.e. about 20 percent of the total production. Their share of distribution is 83.8 percent (1990), serving about 1,101,183 consumers.
Water management in some rural areas is provided by other entities such as Ministry of Agriculture and Agrarian Reform and local governments.
1.03 Bank Previous Loans in the Sect. The Bank plays an active role in the potable water development sector in Morocco and has already granted five loans.
Loan 850-MOR, amounting to USD 48 million, was approved in 1972, became effective in May 1973 and was totally disbursed in June, 1980. This loan financed the construction of water production facilities along the central Atlantic coastline from Casablanca to Kenitra.
Loan S.7-MOR, amounting to USD 1.5 million and approved in August 1977, provided the foreign exchange required for a feasibility study, including preliminary designs, for the sewerage facilities of the Casablanca-Mohammedia area.
Loan 1724-MOR, amounting to USD 49 million and approved in July 1979, contributed to the financing of the expansion of bulk water - 37 -
production and transmission facilities in the mid-Atlantic coastal region, as well as for the Greater Agadir area. It also included funds for credit facilities to finance house connections and related charges for low-income customers of R6gies of Casablanca (RAD), Rabat-Sale (RED), and Kenitra (RAK).
Loan 2006-MOR, for which the present Project Completion Report has been prepared, has contributed to the financing of individual connections to the water distribution network and to the improvement of water production and supply at the national level.
Loan 2825-MOR, amounting to USD 60 million and approved in July 1987, aimed particularly at the rehabilitation of the existing water supply facilities.
Loan 2826-MOR, amounting to USD 60 million and signed in July 1987. This Loan related to the prevention of further deterioration of the existing sewer systems in the Greater Casablanca area through an extensive rehabilitation program; it also financed the Master Plan Studies for Rabat-Sale, Fes, Marrakech, Mekn&s, Tangier, Agadir, Settat, and Nador.
1.04 Bank Obiectives for the Sector. The Bank's lending strategy for the sector has been essentially geared towards assisting the Government in resolving major sector issues and in shaping a strong institutional framework which will efficiently contribute to the country's general development. The Bank no longer focuses on the necessity to provide developed areas with safe drinking water, but has shifted its emphasis towards improving the access of low-income dwellers to the distribution system through housing connections, while contributing to the improvement and operation of water supply systems in semi-rural areas, where more than half of the total population resides. In the sewerage sector, the Bank aims at assisting the Government in establishing financially reliable and efficient institutions which will develop the sector through appropriate techniques of waste water collection, treatment, and disposal.
The Third Water Supply Project, Loan 2006-MOR (RAD), aimed at the main following objectives:
(a) financing of connections to the distribution network at national level (social house connection program) through the Regies and ONEP;
(b) improvement of water production and supply systems at national level (ONEP, Hydraulics Administration).
The water and power distribution companies were concerned with the Project's first objective, i.e. access to credit for financing the social house connection program for low-income customers, allowing for reimbursement over a five-year period. This program, called "Social House Connection" is part of a national plan aiming at improving sanitary and living conditions of residents of the cities as well as of the population living in rural areas. All the R6gies have had access to credit for financing the social house connection program, - 38 - except for RADEEN of Nador and RAK of Kenitra (this latter has cancelled the loan after signing a subsidiary loan agreement).
The social house connection component was jointly financed by the Bank and the Fonds d'Equipement Communal (FEC). The total amount of the 2006-MOR Loan approved by the Bank was USD 87 million, of which USD 39,676,000 were granted to the Regies.
The amount allocated by the FEC to the Regies as local counterpart, was DH 84,190,000.
Before going through the technical aspects of the loan financing, it should be noted that the social house connection component had already been launched at the end of 1979, as a pilot program under the Loan 1724-MOR (Second Water Supply Project). Three Regies located in the Second Water Supply Project area, have benefitted from Loan 1724-MOR: RAD, RED and RAR. It was the first time that distribution R6gies had benefitted from a Bank loan for the financing of individual connections (see Second Water Supply Project, Completion Report, prepared by D.R.S.C., 1989).
In view of the success of the social house connection program under Loan 1724-MOR, the Moroccan Government and the Bank decided to extend this program to the entire network of distribution R6gies, except for RADEEN (Nador), under Loan 2006-MOR. It should be noted that under Loan 2006-MOR, two categories of financing have been differentiated: Category 6 "financing of connection works" and Category 7 "financing of material and equipment".
The Staff Appraisal Report of Loan 2006-MOR provided for the installation of about 110,000 connections in the areas served by the R6gies.
The initial cost was estimated at about USD 58.65 million (DH 20.5 million in local currency), equivalent to DH 246.3 million (DH 86.3 million in local currency).
The implementation of this social program was carried out by the distribution R6gies themselves, each in the area it serves.
The R6gies - executing agencies - are commercial and industrial public entities financially autonomous. They are administered by a board of directors, a management committee, and all their functions are managed by a director. Their main activities are the following:
- water and power distribution;
works and supply (connections, equipment of lots, etc.)
sewerage management by RAD at the Casablanca wilaya level, and soon by the Regies of RED (Rabat), RAMSA (Agadir), RADEEN (Nador), RADEEN (Meknas), RADEEMA (Marrakech), RADEEF (Fes), RAID (Tangier), and RADEEC (Settat). - 39 -
II. PREPARATION AND ANALYSIS OF THE THIRD WATER SUPPLY PROJECT
2.01 Oriain. During the implementation of the Second Water Supply Project (1978-79), it had been noted that the rate of connections at the national level, was 45 percent in the urban areas, and 5 percent in the rural areas. These rates varied from one town to another, according to neighborhoods' living conditions and level of equipment. Slums at the towns' periphery lacked basic infrastructure, including water supply systems, and their inhabitants had to collect water either from public standpipes, or individual or collective water fountains, or from itinerant water sellers, or even from neighbors.
The new water distribution R6gie customers must pay in advance, not only for the installation cost of the connection, but also a contribution for the initial connection. The connection installation cost for individual housing was DH 840 in 1980 (USD 200), and the contribution DH 1200 (USD 285). As the installation cost and the contribution for the initial connection must be paid fully, very few low-income households could afford an individual connection in the past. The Second Water Supply Project included financing for the establishment of a revolving fund to help low-income customers of the R6gies of Casablanca, Rabat-Sa16 and Kenitra pay the installation costs.
This program was so successful that funds were insufficient to meet the demand for credit. Under the Third Water Supply Project, Loan 2006-MOR, similar revolving funds would be established to finance the connection cost for low-income customers in the areas served by the R6gies of F6s (RADEEF), Meknas (RADEEM), Tetouan (RDE), Marrakech (RADEEMA), Taza (RADEETA), Oujda (RADEEO), Safi (RADEES), Beni-Mellal (RADEET), Settat (RADEEC), Agadir (RAMSA), El Jadida (RADEEJ), and Tangier (RAID).
2.02 Preparation and ApDraisal
(a) PreDaration. In view of the experience of Loan 1724-MOR, the social house connection program at the Regie level, was based on studies and information established by the Regies and analyzed by Bank experts. These studies concerned the identification of economic areas and the quantification of connection needs (population, existing and provisional connection rates). This identification lead to the designation of beneficiaries who had to conform to the following eligibility criteria:
(i) it must be demonstrated that the monthly household income is below DH 1,500 (USD 357 at 1980 prices);
(ii) no important commercial activity can take place in the dwelling concerned;
(iii) the dwelling must be located in a densely populated area or a low-income area;
(iv) the dwelling must be of the traditional, or collective or economical type;
(v) in principle, the water meter diameter must not exceed 20 mm; - 40 -
(vi) dwelling must be occupied by its owner, and if rented, the owner's agreement must be obtained to guarantee the reimbursement of the amount paid for the connection installation.
To adapt the income ceiling to inflation, it was agreed, during negotiations,that this ceiling would be analyzed yearly by the Government and the Bank, to determine the purchasing power evolution. It was estimated that about 45 percent of connections installedby the Regies would aim at families whose monthly income would be below the poverty line in urban areas, as in many cases, an individualconnection could serve two to three families (this case was registeredat RAD level).
As no Government contributionwas provided, the interest rate to be paid by the beneficiarieswould be the weighted averageof the Bank loan interest rate, and the FEC 8.5 percent interest rate.
(b) Appraisal. The total project cost was estimated at DH 709.81 million (USD 169 million),with a foreignexchange componentof DH 365.40 million (USD 87 million), representing52% of the total cost.
The cost estimatesfor the variousproject components was established by consultants,ONEP and the Directorateof Local Government from the Ministry of Interior. All estimateswere updated at March 1981 prices (see page 17 of the SAR).
2.03 Prolect Obiectives and Goals. Although the number of dwellings connectedto the water distributionsystems in urban areas during the last five years (1975-80) has increased together the population increase, the rate of servicehas increasedvery little. To improvethis rate, the Second Water Supply Project,Loan 2006-MOR,included access to credit for low-incomecustomers in the Casablanca, Rabat-Sale and Kenitra Regions, for the financing of the housing connection costs and other related charges.
This program was so successfulthat the Loan 2006-MOR expanded this program to other Regies and ONEP. The percentage of population connected to water distributionsystems should, therefore, increase in the urban areas under the project, from 45 to 65 percent in 1985, and to 75 percent in 1990.
2.04 Prolect Description. The social house connection component of the Third Water Supply Project aims at assistingthe country in reaching its priority objectives in the water supply sector, as it would provide improved access to safe water for the low-income residents of the largest cities and to the populationof more remote areas, bypassed by earlier sector investments. This componentincludes among its major featuresthe improvementof water distribution systems operated by the distribution R6gies, by establishing, or increasing, funds for connections,through a revolvingfund in each of the R6gies to finance individualconnections and related contributions. - 41 -
The USD 87 million loan that the Bank has approved , was granted to the Government, which onlent the proceeds to 11 distribution Regies and ONEP. ONEP was the project greatest loan beneficiary, receiving USD 45.76 million, accounting for 53 percent of the total loan amount. An amount of USD 38.15 million, accounting for 44 percent of the loan amount, was initially onlent to the R6gies to finance the foreign exchange cost of individual connections.
The Government would allocate the remaining USD 3.09 million to the Hydraulics Administration for the water resources development program. The loan was to cover the foreign exchange expenditure and the renewal of funds for connections financing, and to finance about 45 percent of the project total cost. Similarly, FEC had agreed to lend the Regies the necessary funds to cover the local financing of credit for housing connections, including related charges for low-income customers.
It should be noted that under the social house component of Loan 2006-MOR, two categories of financing were differentiated:
Category 6: "Works on force account." The installation of housing connections and extension of distribution networks would be carried out by the R6gies with their own means. The R6gies have the necessary equipment and skilled manpower, and they have acquired the necessary technical skills. The experience acquired by the Casablanca, Rabat-Sal6 and Kenitra Regies in the launching and implementation of the first phase of the housing connection program under the Second Water Supply Project (Loan 1724-MOR), has indeed helped the other R6gies. The percentage of expenditure financed under this category is 65 percent of the net financing (Annex 1, page 31 of the Loan Agreement).
Category 7: "Materials and Equipment." This category relates to the acquisition of materials and equipment for the works under force account. Equipment contracts, with or without installation, below USD 250,000 each, with a total amount not exceeding USD 2.5 million, would be awarded after local competitive bidding. Contracts above this limit would be awarded after international competitive bidding, in accordance to the Bank Guidelines for procurement procedures. The percentage of expenditure financed is 100 percent of the foreign exchange expenditure, and 48 percent of the local currency expenditure. This disbursing rate has, however, been revised and increased to 56 percent.
The terms of the Loan are 19 years, including four years' grace and the interest rate was 7.9 percent. Interest and other charges would be payable every six months on April 15 and October 15 of each year. The repayment schedule is given in Annex 3 of the Loan Agreement. Works related to the project would be fully executed by the Regies' own material and human resources, without major modification of their internal structures. During the housing connection works, R6gies were advancing their own funds for acquisition of necessary material, while waiting for funds to be released. - 42 -
III. PROJECT IMPLEMENTATION - PROJECT COST AND OPERATION
3.01 Effectiveness and Startup
(a) Effectiveness. The social house connection program became effective with the signature on September 28, 1981, of the Loan agreement 2006- MOR, between the Kingdom of Morocco and the World Bank.
In conformity to this Agreement, subsidiary loan agreements were established on March 1, 1982, between the Government of Morocco and the eleven R6gies (RAD, RADEEF, RADEEMA, RADEEM, RDE, RADEES, RADEEO, RAID, RED, RADEETA, RAK), and were afterwards extended to RAMSA, RADEET, RADEEC and RADEEJ. Similarly, on August 20, 1982, FEC and the Regies signed the loan agreement governing local financing.
(b) Startup. The effective startup of execution differs by Regie but generally speaking, launching of this program started during the second half of 1982. To launch the social house connection program at national level, measures adopted during the 1724-MOR Loan project implementation, were applied to all Regies. Among these measures were the launching of a widespread information campaign aiming at making local population sensitive to the program. This campaign included, among others:
- permanent sensitivity of the entire staff of the Regie;
- information of population concerned by distribution of leaflets, posters, door-to-door, etc.);
- approaching local authorities to facilitate paperwork for connection requests;
- giving beneficiaries specific printed forms for connection requests;
- training staff to ensure a good reception, handling, and followup of connection requests.
3.02 Implementation. During the implementation of the social house connection program, some technical, administrative and financial difficulties have occurred, which have hampered operations:
- partial or total lack of refuse collection and sewerage systems in some neighborhoods;
- impact of standpipes on a number of connection requests in areas affected by the program;
- bureaucracy of formalities to fulfill the requests for connections;
- beneficiaries' monthly income ceiling turning out to be too low;
- delays in release of Bank's funds. - 43 -
Corrective measures had to be taken to improve the implementation rate:
- extension of implementation deadlines: the closing date, initially established at December 31, 1985, was extended to end of 1987, then to December 31, 1989;
- amendment to the Bank's release of funds: the Bank has raised in February 1985 the disbursement rates for Category 6: "Works on force account" and Category 7: "Materials and Equipment", to 75 percent (instead of 65 percent) and 56 percent (instead of 48 percent) respectively, retroactive to November 1, 1983, and valid until June 30, 1986. These rates have been maintained until the completion of the social house connection program. To accelerate the release of Bank's funds, a Special Account was open with Bank Al Maghrib, through which funds are onlent to the R6gies;
- transfer of funds among Regies: several transfers of funds took place among the loan various beneficiaries, to face the increase of connection demand in some Regies. The various reallocations among Regies and among categories have altered the initial allocations (see Table 11);
- financial revision of eligibility criteria: the monthly income ceiling by beneficiary was increased from DH 2,000 to DH 3,000 as of May 1, 1984, so that a larger segment of the population could benefit from the social house connection program.
The Regies have added to this general revision, accompanying measures or internal technical and administrative measures, to accelerate the implementation pace.
3.03 Implementation Schedule. The subsidiary loan agreements of the social house connection program projected 88,700 connections during the 1982-85 period. The implementation schedule was extended (1986-89) to meet the increasing connection demand. The Table hereunder shows the implementation by Regies during the first period (1982-85) and the second period (1986-89). - 44 - SCHEDULE OF PHYSICAL IMPLEMENTATIONS
PLANNED ACTUAL % OF IMPLEMENTA- REGIES PERIODS CONNECTIONS CONNECTIONS TION RATES
82-85 15.000 1.181 7,87% R.A.D. 86-49 0 4.849 Total 1I.000 6.030 40.20%
82-45 3.500 2.975 35,00% R.E.D. 8649 0 15.426 Total 3.500 18.401 525,74%
82-85 4.500 3.280 72,89% RAID 86-49 0 3.549 Total 4.500 6.829 151.76%
82-85 6.200 5.221 84,21% RDE 8649 0 3.587 Total 6.200 8.808 142,06%
82-45 0 0 RAMSA 86489 6.000 1.968 32,80% Total 6.000 1.968 32.80%
8245 14.000 2.872 27,66% RADEEF 8649 0 2.995 Total 14.000 5.867 49,05%
82-85 2.500 2.376 95,04% RADEEC 86-89 0 3.993 Totl 2.500 6.369 254,76%
82-4 4.000 2.945 73,63% RADEEJ 8649 0 3.725 Total 4.000 6.670 166.75%
8245 5.000 2.930 5t,60% RADEEM 86-89 0 2.981 Total 5.000 5.911 118,22%
82-45 5.300 5.567 105,04% RADEES 8649 0 0.842 Total 5.300 6.409 120,92%
82-S5 6.200 4.757 76,73% RADEET 86-19 0 2.970 Total 6.200 7.727 124,63%
82-45 10.000 5.893 58,93% RADEEMA 8649 0 0 Total 10.000 5.893 58.93%
82-85 1.300 0.673 51,77% RADEETA 8649 0 0 Total 1.300 0.673 51,77% 3245 5.200 2.448 47,08% RADEEO 8649 0 2.656 Total 5.200 5.104 98,15%
8245 82.700 43.118 52,14% TOTALGENERAL 8649 6.000 49.541 325,68% Total 88.700 92.659 104.46% - 45 -
It can be noted from the previous Table that the social house connection program, was very successful, as the implementation rate exceeded 100 percent, compared with the initial projections. This rate reached very high levels for some of the R6gies: RED: 525.7 percent; RADEEC: 254.8 percent; RADEEJ: 166.7 percent; and RAID: 151.7 percent).
It must be noted, however, that this implementation rate only reached 48.61 percent during the first period, in spite of the high level for some Regies (RADEES: 105 percent; RADEEC: 95 percent). This is mainly due to start-up problems faced by the Regies, particularly:
problems mentioned in para. 3.02, which lead to the extension of the program duration;
delays or alterations in slum resorption programs;
some customers were located at the end of the distribution system, which implied additional delays to extend the distribution network prior to install the connection;
It should be also noted that after the Bank agreed to fund reallocations among Regies, and among categories, Regies could receive additional funds, which partially explains the implementation rates above 100 percent.
3.04 Procurement. Contracts related to the social house connection program were awarded by local bidding under the usual annual contracts that the R6gies establish for their requirements in goods and works, according to their specifications. Disbursements from FEC and the Bank were of 68 percent, compared with the total amount of contracts made by the Regies for this program.
3.05 Cost and Disbursement. Tables 1 and 2 hereafter detail the statement of expenditure for the works executed on force account (Category 6), with or without fee for the initial connection.
The following conclusions may be drawn from these tables:
the average cost of a connection with the initial connection fee, is DH 3,354.61 per connection, while the average cost of a connection without initial connection fee is DH 1,331.60 per connection;
the overall average cost for the social house connections financed by the Bank and FEC is DH 3,3331.79 per connection.
on the 92,659 connections installed, only 17,809 were installed without initial connection fee. This is due to the fact that the program mainly concerned neighborhoods not equipped with drinking water systems, which lead to customer contributions to the network extension. - 46 -
Total expenditure for the execution of the connection program has reached DH 310,834,765.61 for all Regies concerned, of which DH 172,339,868.50 with initial connection fee, i.e. 56.69 percent.
3.06 Financinc. The financing of the social house connection program was made on the one hand by the disbursements by the Bank and FEC (Table 3), and on the other by the customer repayments, after deduction of the debt service (Table 4).
Table 5 shows that the ratio between cumulative disbursements at the end of 1989 and the allocated amounts is 68.2 percent.
Tables 3, 4 and 5, indicating financial resources, only present cumulative statements at the end of 1989, while a more objective presentation should have been made, analyzing year by year disbursements, customers repayments and maturities.
In this respect, it should be noted that most of the R6gies have pursued the social house connection program with the revolving fund (generated by beneficiaries repayments).
3.07 Disbursement Performance
(a) Bank. After the signature of subsidiary loan agreements and during the execution of the loan, some modifications were made to the amounts initially allocated by the Bank. It may be a total cancellation as was the case for RAK (Kenitra), or partial cancellation (RADEEMA, RADEEF and RADEES), or a reallocation among categories within the Regie (mainly from Category 7 to Category 6), or reallocation from one Regie to another at Category 6 and/or Category 7.
These modifications were introduced after agreement by the Bank, the Ministry of Interior and the Ministry of Finance. During the fiscal year 1989, the Bank started meeting all disbursement requests without preliminary authorization and without taking into account the initial allocation. This was done to allow the Regies exceeding their quota to benefit from funds from other Regies which had discontinued their participation in the program.
With respect to disbursement performance, Table 6 indicates allocations as they were modified until the end of 1989 (USD 39.7 million) and releases effectively granted by the Bank (USD 42 million), equivalent to DH 347.7 million, i.e. an overrun of about USD 2.3 million, which translates by a clear success for RED, RADEEF, RADEEMA and RADEEC. The overrun for Category 6 should also be noted, i.e. 115.7 percent.
(b) £E. With respect to the local financing by FEC, Table 7 shows that the overall rate of disbursement performance was only 79.7 percent, as on DH 84.19 million allocated, only DH 67 million were used. The RAD and RAMSA R6gies have only reached 32.5 percent and 14 percent respectively in Category 7. RADEETA had cancelled its credit. - 47 -
Table 8 presents an overall disbursement performance amounting to DH 347.7 million for the Bank, and DH 67 million for FEC, i.e., DH 414.7 million.
It should be noted finally that during the execution of the program, disbursements reaching the R6gies through the Ministry of Finance, differ from the statements communicated by the Bank. A comparative situation is given in Table 9. The overall difference is USD 61,226.97, meaning a plus for the R6gies, which is still unexplained.
IV. SOCIO-ECONOMIC PERFORMANCE
Through approval of credit for financing the social house connection for low-income households and repayment facilities, the social house connection program has had a driving impact on the social as well on the economic performance.
4.01 Social Performance. This program has connected 92,659 households to the water distribution system. It has contributed to the improvement of sanitary and health conditions of the connected families, and has therefore contributed to the improvement of their living conditions, as well as public health and socio-economic environment of the areas concerned.
4.02 Economic Performance. This program has contributed to the improvement of the connection rate for all Regies, which increased from an average of 65 percent in 1982 to 80 percent in 1989.
This social program has also contributed to the elimination of standpipes. In fact, the number of standpipes in the areas served by the participating Regies has decreased from 2,290 standpipes in 1962, to 1962 in 1989, i.e., the elimination of 228 standpipes. TABLE 1: Statement ofExpenditure for Works Carried on Force Account
lo. of: Amt. of t Avg. : Connections Costs lOverhead I Total :Amt. grant.-.Avg- I I4giesponnect. Tax Cost Costs------C114+(31 a ) for Cost8t t (al1 111 :11)1(11 HaterialSlsalaries : Total (21 131 1 (4) I :S) ref inan4116.(IS /aI :a UAD I 6.030,01 12.881.133,90:2.136,17 I.65.619,6171.325.7195,96 1 5.971.465,3 11.199.217,602.72.91,00 22.811.801,1318.132.103,79 13.783,55 :: IID 18.401,0038.669.812,85 :2.10151 9.191.353,01 5.198.719,91115.193.122,9 7143.102,061.383.110,51 .9819.8918,4250 .730.512,15 :3.368,63 ,: ID 18.808,00124.131.797,52 :2.819,80 11.105.301,31 11.865.189,17 5.910.I91,85I2.112.151,4 13.173.181,96;31.763.221,79 36.763.229,73 ,1.173,85 :1 IAID 6.829,60:11.151.516,12 12.512,11 41.30.232,141 3.411.501,35 0.219.731,71 :2.3819.905,27 1.340.876C,2 1 29.135.038,J0 :29.135.038,11 61.266,37:: RAK$S 1.968,001 3.208.933,01h1.630,56 :2.31t.511,00: 1.411.738.12t3.16.319,12 1 411.581,821 573.5$1,11 1.041.3193,i 7.751.603,51:1.086,07 :: IADIIC 6.3C9,00 I 9.578.233,2111.503,88 9.7614.40,66 977.216,71110.7141.67,4 :1.616.533,02 12.669.632,79 24.01.171,12 1 23.465.919,40 :3.863,63 : RADII?, 5.867,01 9.I45.168,591.611,012 3.636.119,32 1.951.119,30 5.517.693,12 1.127.674,1122.064.60,66 11.725.450,01 13.197.315,66 :3.191,66 IADIIJ, 6.670,00 7.305.118,2101.095,23 :5.704.961,13 1.460.711.30 ,1.115.51,131 2.111.235,52 2.135.206,48 13.712.381,20118.712.381,20 12.815,1511 IADIIKI .911,001 9.211.131,011.570,65 I4.46.36I,00 1.336.003,15 5.836.809,45117.131,43 :1.895.230,16 17.117.602,0115.131.562,48 :2.900,96:: lADIIO, .101,00 9.413.542,71191.56.1 I 3.3019.117,53 : 772.026,621.0181.111,15: 305.004,14 . 695.111,61711.551.718,75:14.551.718,75 :z.esi,is I lADIESI 1.409,00110.01.173,58 11.5M3,9 11.183.11,13 1735.017,57 :4.918.705,7111.342.451,18 1 121.171,921 17.011.005,31:17.0104.005,38 j2.CS3,11 0 1ADII? 7 727,00:13.445.551,7 11.7140,171 - - :9.817.611,9411388.215,22 1.621.837,59 25.353.323,7221.911.025,01 :3.281,13 , IADIIEA 5.893,001 5.685.931,17 1 964,86 3.121.615,171 :.289.772,7:14 4.114.117,15 2.029.133,30:1.3169.6187,25 13.119.110,37: 12.909.110,37 :2.290,71 1 ADIETA:,673,00 , 1.141.952,17,1.707,21 0 : 1.261.215,23, 2.416.108,20 003.590,011 Total I 92.659,00:172.339.868,52 11.859,94 :60.060.915,45 :21.803.431,13 :93.129.217,75 16.459.311,18 129.106.365,16 1310.834.165.61 1290.716.2219,13 .3.354,61 TABLE 2: Statement of Expenditurefor Works Carriedon Force Account withoutTax for Flrst Establishment
No. of ' Connections Costs :Overhead TTotal i Avg.,'; liqies:Connect ------c t as 1 2+3 Cost (a) ISalariesMaterials TotalI1 (21) 131 11(4) 14)1( I.:
IAD 583,001.C56.151,82 335.396,18 1.391.551,00 219.329,55 ' 211.513,92 1.882.394,417 3.228,81 Il I1D 4.943,001.832.437,50 1.510.338,80 3.342.176,300 197.720,00 576.359,85 4.116.856,15 832,87 ID ; ,: 0,00: t 0,00 IAID 9,00 5.827,31 3.869,25 9.696,56 2.908,92 1.418,071 14.023,55:1.558,17i RAISA 964,00 829.125,16518.203,22 1.347.328,38 : 170.885,84 : 209.129,89 1.727.344,11 :1.791,85 " RADlIC 902,001.147.260,55 121.619,18 1.268.915,23 225.976,55 243.359,36 1.738.281,11 :1.927,141 RADIIF 399,00 282.018,40: 139.171,20' 421.189,60 83.391,00 118.614,68'653.195,28 :1.631,08 ' IADUEJ 3.777,003.750.917,37 1 950.729,12 4.701.616,49 :1.423.051,61: 683.067,65 6.807.765,75 01.802,13 1, IADIEK 1.888,00:1.398.114,42 474.043,68 :1.872.458,10: 22.317,51 256.322,07:2.151.127,68 :1.139,37 : RADIKO 22,00 10.862,69: 7.655,19 18.518,18 396,00 2.647,714 21.561,921 980,09: IADICS 2.185,00:1.401.191,49: 256.885,66 :1.658.080,15 415.094,87 262.149,122.335.324,11 :1.068,80 " BADIET? 166,001 131.205,6383.200,56 214.406,19 11.963,32 28.056,04 254.425,55 :1.532,68 BADEIEA:1.971,00 1.029.570,90: 479.207,341 1.508.178,214 300.562,22 202.842,47 :2.012.182,93I1.020,89:: IADIITAI i 0,00 :,ooii
Total1 17.809,00112.874.994,24 4.880.381,18 :17.755.374,42 ;3.133.627,39 :2.825.480,86 :23.714.482,67 :1.331,60 li ------50 -
TABLE 3: Net Revenue Statementin DH at the end of 1989
Debt Service Net R6gies S.H.C.P.C.:------'Revenues Bank (21 f.E.Ci;l Iotilil 111.(41:51I5
RMbD* 1.CW.541.25 11.121.8.18,2 1.503.00 1153.'36.35 S.331.103. .1 .81.3 5.105.5.193 REDRED : c.9i2E.511 2.1!5, 1 14 ISSA12*5Lx 2.508.01C,07:21.576.5S3 Sl5519.3" DE . 31.315.3073?1 i.331.929.121.3l1.310.Pi N.713.Z39.21:1l.572.066 :: RAID ; 14.088. 2,'l1I 22.770.600.2, 3.t17.641.07 25.143.241.368.53.200,65 U MASA 5.446.10.051 j.511.454.73 610.721,50 2.167.171.23 3.279.929,82:. RADEI A3.217.51,3S12.890.012,31 2.174.128,30 .66.440,61 7.763.211,25 RADGUV 14.17t.15,O0 I 11.153.270,06 7.601.617,51 13.176 3.,.1 UI.I03.572,63)U AAIIEJ201.131.;7.3? 13.196.631.02 2.980.910,21. 1.4177.511,28 3.653.94,09, AAMIA:31.202.631.31 1 24.N22.179.05 j.837.552.71 31.A59.711.98 f451.106.8il RUEO !2.551013.13I 8135.385.52 :3.567.13l.33 .10.522.817,851 2.023.196.08; RDJUS' 3;.577.'iO.31I 3.!44.024,58 31.900.532.31 [2.044.556, 1 23.629.413.461 ~ADEErt 20.I17.S1.i ' z12.163.571,;i 1.2714.255,33li.437.$27,16 :4.319.237,62 MM 117,054.35 7iO'$.774A.i 3,33127,01 1-.453.173.94 .16.3.615,41,; UErA. ;.1V7.9SZ.5TI 49I . 79. 1 107.511,24 Q17.137.0O1.440.329,57 , ...... :...... ------oTat)lI131I.S.636.21 t117i1.57.H1e 13.111.513.3l 227113.465.10:82.507.170,51 U ...... C.. SocilHus....gConect...... Pm C t......
S.H.C.P.C.: Social Housing Connection Program Credit - 51 -
TABLE 4: Connections Costs and Repayment (Category 6) in DH
RAgies Amounts Repayment in DH (Category6) granted ______- _ , t F.BankS.C TotaL"
RAD 18.032.903,79 1 3.524.677,6t 5.250.000,00 : 18.774.677,66 . RED ! 56.730.512,.5 48.592.827,49 : 500.000,0C : 49.092.827,494 l RDE 36.763.229,73 16.486.2?:,49 1.150.oCO,OC 17.636.271.4X , RAiD 29.135.038,60 21.493.784,47 t 900.000,00 ' 22.393.784,47 ' RAMSA 7.759.603,54 ; 3.685.902,21 : 1.060.000,00 4.745.902,2; , RADEEC ' 23.465.979,40 : 14.640.529,87 920.000,00 15.560.529,7. '' RADEEF 18.4S7.315,66 11.715.237,20 2.400.000,00 14.1.5.237.20 ' RADEEJ 18.78-.384,20 12.361.75,81 690.000.00 13.05l.75i.3. ; RADEEM: 15.134.562,48 10.353.939,33 2Z-69.909,03 10.623.848,36 RADEEO 14.554.798,75 I' 3.418.533,19 t 900.000,00 4.318.533.19 RADEES 17.004.005,38 4.903.637,73 950.000,00 5.8S3.637,73 ; RADEET 21.950.025,08 9.945.645.39 1.150.000,00 11.095.645,39 I; RAkDEEMA;12.905.870,37 9.488.951,48 1 1.700.000,00 11.188.951,48 H RADEE':AI 1267245,23 585979,95 193.920,00 779.899,95 H Total 129I. 987. 474,365 1-181.197. 669,27 118. 033.829,03 1199. .31.498, 30 H _____ ------_ ------_ TABLE 5: Bank Fmancial Performance in USD at end 1989
Cagegory 6 (Works) Category 7 (Materials) , Category 6 + 7 ' ligies, r 1 a - - - -r-- IAlloca-*Executon Alloca-E - , uxecution, Alloca- i Funds ,Executlon , t ------UDI 'Releases'. of Works 'tions ' Releases gl-izrke 't.jqn 'Releases 'of Wor-ks lDO 1.446.157,001.14.615,43 113,7l2l5.700.000,08s 1.867.793,00 85,40117.146.157,00 IED 2.772.149,00 6.512.408,413 Sl,!311 5.937.70,174 214,191:861.100 61.611,550 100,001:3.633.820,00 Dt1 2.210.117,00 6.199.380,29 181,11: :2.166.212,62 93,481:1.695.511,00 01.791.925,5: 105,861;3.905.994,06 :3.661.158,13; [AID 3.160.490,602.473.949,78 98,851%; 1 72,541:1.775.199,00 :2.441.668,31 1 137,541,5.185.689,00 :4.915.118,09 911'9,1 DAISA; 350.600,02416.895,20 127,681; 600.000,00165.347,416 30,89E950.000,00 1 632.242,66 , i66,5511; IADEIC 1.510.000,0011.181.210,31 111,31:,921.100,00 9936.261,18 1 101,101:, JADIIF .436.100,0112.617.1771,49 107,45131 1.362.000,00.1.508.711,60 110,171'1.310.000,000 1.480.648,69 113,03112.612.000,00 , 11.449.720,00 2.989.366,290 111,8811! RADIEJ , 1.454.H09,69 100,35s11.022.212,00 11.022.201,51 919,191' 2.4172.002,60 :2.177.014,20 ADIEIN 971.417,00;1.231.203,28 100,20%'; 126,181,1.150.000,00 830.140,19 0 72,2512.127.117,00 :2.067.043,417 91,161;: DADEKOO 510.000,00406.340,59 t 71,2910930.000,00 :1.120.200,92 120,151J1.500.000,00 1.526.541,51 0 1,111,:: 1ADlES' 561.866,00I 561.866,39 1 100,001|910.008,00 610.235,63 63,571:W 1.521.874.00 IADEttl 1.010.000,00 :1.172.101,991 77,021:: :1.216.066,25 116,931;1.146.000,00 1.281.808,135 1 61,101;2.500.000,00 :2.41.8174,60: lADI1§A,:1.145.166,00 99,911:n 1.115.165,40, !00,00102.418.752,00 02.801.858,68 0 116,091: 3.563.918,00 :3.953.024,08 RADEITA 61.029,00 110,121:: 1 61.029,260 100,0013 0,00t 0,00t 61.029,101 61.029,21" 100I,001 Total:16.866.441,00 ;21.840.610,54 126.241.469,951 915,777:2o.aos.55,,o91,271:39.6176.000,0:142.082.280,19 106,0611 ------. - . -..-- --. ------. -. -. ------. -- ---. - --. ------TABLE 6: FEC Fimancial Performance in DH
Category 6 (Works) Category 7 (Materials) Category 6 + 7 R4gies Ivgiei~~~~~~~~~~~~~~~~~~~~~~~uziO 411oca- Funds Fnds I ------llca faaas ------Executior~3on 1Executior AJloca- , Funds , Executionu Aloca- , Funo a ' oios' ' of Releases' Works tions Releases. of Works' IAD 5.250.000,00 5.250.000,00 100,001'18.100.00,005.970.600,00 32,451:23.650,000,00h11.220.600,00 RED 41,441:: 500.000,00 500.000,00 10,00i, 2.150.000,00 2.150.000,00 100,001'2.650.000,00 :2.650.000,00 100,001,, IDE 1.iso.ooo,oo1.150.000,00 100,001,3.850.000,00 3.850.000,00 : 100,001'5.000.000,00 5.000.000,00 : -10O,01! RAID 1 800.000,00800.000,00 100,00132.800.000,00 :2.800.000,00: 100,001:3.600.000,00 :3.600.000,00 ioo,ool: RAlSA :1.060.000,00 1.060.000,00 100,00,: 3.840.000,00539.515,00 14,05l1 I.900.000,00 :1.599.575,00 32,641U RADEIC 920.000,00' 920.000,00 100,001,3.330.000,00 3.330.000,00 100,001,4.250.000,00 4.250.000,00 100,001: IADEEF 2.100.000,00 2.400.000,00 100,001, 8.600.000,00:8.600.000,00: 100,001l11.000.60,,00 RADEEJ :11.000.000,00100oo,0O 690.000,00 690.000,00 100,001:2.100.000,00 2.100.000,00 100,001:3;090.000,00 :3.090.000,00: IADEEKN 850.000,00 100.001:" 269.909,03 ' 31,151;3.100.000,00 .3.100.000,00: 100,00113.950.000,00 3.369.909,03 85.31,11 R lADIEO' 900.000,00 900OO.000,00: !00,001,3.200.000,00 :3.200.000,00 IOO,OOI,4.100.000,00 :4.100.000,00 lo0,00,, lADIES 950.000,00; 950.000,00 100,001,3.250.000,00 ,3.250.000,00 o00o,oo:,4.200.000,00 4.200.000,00 1 100,001' RADEET: I.liO.OOO,OO' i.iSO.OOO,oo , IOO,OOS;3.850.000,00 :3.850.000,00 100,001'5.000.000,00 ,5.000.O00,00 , 100,0011, w RADEEKA 1.700.000,00, 1.700.000,00 : 100,0016.100.000,00 :6.100.000,00 100,00117.800.000,00 17.800.000,00 100,001,' RADRETA200.000,00 1 93.920,00, 96,9611 800.00C,00, 0,0O 0,00 1.000.000,00 193.920,00 19,391,, total :18.520.000,00:11.933.829,03 1 96,831165.610.000,00:49.140.175,00 , 71,831:84.190.000,00:67.014.004,03 1 79,671" ------.- - - -- .------. -. ------.------54 -
TABLE 7: Situation of Funds Releases Bank + FEC in DH
Category 6 Category 7 Total h7 ligims…------~ ~ ~ ~ ~ ~ ~ ~ ~ 1------Bank : I.C ' Bank : F.I.C Bank ' .I.C : W ' 13.524.177,I61 5.250.000,00 1,39.445.615,90 : 5.970.600,00 52.910.293,56 :11.220.600,10 1 IID 48.592.827,45 500.000,006.622.108,99 2.150.000,00 :55.214.936,48 2.650.I00,10 0I :16.416.271,491.150.000,00 16.363.000,55 3.850.000,00 :32.849.272,44 S.o00o.100,i0 : UiD 521.143.784,47800.000,00 119.470.925,84 2.800.000,00 40.91(310,31 1 3.100.100,10 lUBA 1 3.635.902,21t1.060.000,00: 1.509.072,31 539.575,005.194.974,52 ,1.595.575,00:: 1lDFt11.715.237,20 2.100.000,00 :11.874.630.0Q 8.600.000,00 23.589.867,24!11.000.000,10 : WIIJ :12.311.751,81 190.000,001 8.868.763,7162.400.000,00 21.230.515,57 i 3.091.000,00 :1 ADIE:10.353.139,33: 265.905,03 1 5.899.424,93 :3.100.000,00: 16.253.361,26 :3.369.909,13 :: lRDIKO 3.418.533,r9 500.000,00: 9.169.555,763.200.000,00 1 12.588.088,954.101.000,00 :: WDIC I14.640.529,817920.000,00 : 8.176.138,68 :3.330.000,00 22.81i.668,55 1.251.000,00 AII 9.945.645,311.150.000,00 1 10.731.722,323.850.000,00 :20.6177.367,71 5.000.000,0O 1 RADIIKAI9.488.951,48 :1.700.000,00 23.865.508,82: 6.100.000,00 33.354.410,30:7.803.000,00 WRDIITAISIS.9SS,9S : 193.920,00 1 585.919,95193.920,00 11 tIA S 1 4.903.137,73 950.100,00, 1.555.880,48 :3.250.000,00 : 9.455.518,21:4.280.000,00 1
Totil 1181.197.669,27117.933.829,03 :166.552.348,78 149.140.175,00 :347.750.018,05 :67.074.004,03 :: - 55 -
TABLE 8: Comparative Situation of funds Releases between Bank and Rkgies in USD
Category 6 (Works) Category 7 (Materials) G. Diff.., Ugies,------M 21 , lRegiesData Bank data.Diff.(!)Regies DatA Bank data Diff 8
lAD 1.644.615.43: 1.644.615,43:0 0,30 4.867.793,00 14.867.793,00 0,00 10.00 ,' *ID I 5.937.708,74:5.900.626,30 37.082,44 861.671,55 861.671,55 0,00 37.082,44'7 IH 2.066.232,62:2.086.624,73 I120.39),111I 1.794.925,51 1.774.534.791 24.390,72 (1,39),' IAID 2.473.949,78 2.473.949,98, (0,20)12.411.668,31 2.441.668,31 0,00 ' (0,20)18 IJIW 1 446.855,20 446.895,20 0,00a 185.347,46 185.317,46 0,c0l 0,00 IADIIC 1.681.210,31 I.i91.672,84 9310.662,63)t536.267,18 936.267,181 0,00 0 (10.162,531', UDIII, 1.508.717,60 1.508.717,60 0,00 ! 1.180.648,69 1.480.648.69 0,00 0,00' WIIJ 1.451.809,69:1.459.517,46 (4.707,77)'1.022.204,51 1.022.281,74 (77,23)1 11.785,00)7' wAin 1.236.203,28 1.236.203,281 0,00 1830.840,19: 830.840.19 0,00 0,00 UIN I406.340,59 1 406.340,59 0,00o 1.120.200,92 1.120.111,22 59,70 59,70, MIR$ 561.866,39 561.866,39 0,00 1 610.235,60 960.007,9611349.772,36)1 (343.772,36):; bAllET0 1.216.066,i5 1.216.056,21 0,041:1.281.808,35, 1.281.809,17, (0,82): (0,78), lAUIR:1.145.165,40 1.145.165,56 I (0,161:2.807.858,68 1 2.418.751,69! 389.106,991 389.106,838 NADIiTA 61.029,26I 61.029,00 0,26 j 0,00 1 0,00 'j 0,00 1 0,26
Total :21.840.810,51:21.839.290,57: 1.519.97:20.211.469,95 20.181.762,95 1 59.707.00 661.226,97 8 =------56 -
MOROCCO
THIRD WATER SUPPLY PROJECT (Loan 2006-MOR)
PART II: PROJECT REVIEW FROM
BORROWER'S PERSPECTIVE
ADMINISTRATIONDEL'HYDRAULIQUE - 57 -
KINGDOM OF MOROCCO THIRD WATER SUPPLY PROJECT (LOAN 2006-MOR)
PROJECT COMPLETIONREPORT
Water Resource DeveloDmentComponent
1. Prolect Oblectives
The Third Water Supply Project financed by the Bank under Loan 2006-MOR aimed at:
- increasingsafe water supply by installinghouse connectionsfor the low-income population;
- assisting ONEP in strengtheningits operationaland organizational capacity;
- improving and coordinating decision-making procedures for investmentsin the potable water sector.
2. Compositionof the Proiect Component
The Water Resource Developmentcomponent of the Project consists int
- Part E: Water resource development by installing boreholes and wells with infiltrationpassages in about 24 centers;
- CateRory 4: Consultant services and training.
3. Loan Amount
The total loan amount allocatedto the Water resourceDevelopment component was USD 7,983 million, of which USD 2,630 million were allocated to Part E, and USD 5,353 to Category 4.
4. Loan Duration
The Loan Agreementwas signed on September9, 1981 and became effectiveon March 15, 1981. The Project completion, initially foreseen for December 31, 1988, has been extended to December 31, 1989.
5. Physical Results
5.1 Part E: Water resource Development
In order to develop undergroundwater resources,a contractwas awarded to three local firms, one being a pilot enterprise. - 58 -
a) Composition of works
Works consisted in exploration drilling and trial boreholes in 15 urban centers scattered throughout the Kingdom of Morocco, with the exception of the Saharan Provinces located south of Tan.
Three workshops had been foreseen for Contract 21/86/DRPE:
- Workshop B: air survey - Workshop D: trial boreholes - Workshop E: rotary survey
b) Organization of Studies and Hydrogeological Follow-up
Preliminary Studies
Studies started with desk work, i.e., analysis of available geological maps, interpretation of aerial photographs (and in some cases satellite photographs), analysis of data from IRE's files, archives from the Water resource Division (DRE), or from Hydraulics Regional Directorates (DRHs). Installations were then proposed, and in most of the cases, an installation report prepared.
These studies were carried out either by the Water Resources Division (DRE) in Rabat (90 of the time) or by the Hydraulics Regional Directorates (DRHs) concerned.
Afterwards, several field missions took place for each center to:
- verify the real situation of the center's water production; - analyze local hydrogeological conditions; and
- install boreholes.
Hydrogeological Followup
Each tubewell workshop was supervised by a hydrogeologist/engineer residing on the work site, and assisted by a technician, whenever necessary. This engineer had the authority to take any decision concerning the functioning of the work site under his charge. He kept the DRH concerned, or eventually DRE in Rabat, informed of progress and technical or hydrogeological problems encountered. He prepared a report once the work was finished. Most of these reports were completed and published. After developing trial boreholes and flow yield tests, a summary note on local hydrogeology and operation possibility was written for some areas.
At the central level at the DRE in Rabat, a Project Manager assisted by an expatriate adviser, performed overall supervision with respect to the hydrogeological, technical, financial, and administrative aspects of the operations. - 59 -
Long Duration Flow Yields Testing
Some "D" trial boreholes were tested over a several-day period with a pumping group from DRPE (Research and Planning Department, Hydraulics Administration) and also with DRPE financing. These boreholes had been previously developed and tested for one or two days by the Agency. These long duration pumping tests were indispensable to the enhanced assessment of the operational flow. c) Results of works
The Project has developed new underground water resources and brought to light the existence of several aquifers. Seventy percent of the works accomplished were positive (See Table 1). These installation works have allowed, inter alia, the sector to meet water demand in several centers such as Essaouira, Midelt, Chemaia, Azrou, Guercif, El Gara, Larache, and Azizal, and confirmed interest in integrating several aquifers into the observation network:
- Turonien of Essaouira; - Lias of Midelt; and - Pliocene (close to Guercif).
5.2 Category 4: Consultants Services and Training
Under Category 4 of the Loan, DRPE has employed consultants to carry out master plans studies of water resource development of the following basins:
Sebou, Bou Regreg, Oum Er-R'bia and Tensift; - Moulouya; and - Loukkos, Tangier area, and Mediterranean coasts.
5.2.1 Integrated Master Plan Study of Water Resource Development of the Sebou. Bou Regreg and Oum Er-R'bia Basins and the Tensift Basin
The contract for the study signed with a joint venture composed of one local and two foreign firms was approved on January 5, 1984.
The integrated master plan study of water resource development for the Sebou, Bou Regreg, and Oum R'bia basins aims at defining a optimal scheme for the mobilization of underground water resources in a technical and economic point of view, taking into account their availability, technical, economic, and social constraints, quantitative and qualitative nature of the demand, orientation, and objectives of social and economic development plans at regional, national and sectoral level, and protection and conservation of the envirormental hydraulic resources. The other objective of the study was to establish the pre-feasibility of integrated development projects for the supply of drinking, industrial, and irrigation water, hydro-electric power production, and protection against floods. - 60 -
The study was divided into two missions:
- Mission I, concerninga criticalanalysis of the existing situation, assessment of, and comparison between, resources and water needs, lasting 12 months.
This mission included:
Sub-missionI-A: critical analysis of existing situation.
Sub-missionI-B: water resource study.
Sub-missionI-C: water demand study.
Sub-missionI-D: resource/needsresults, critical analysis of medium-and long-term equipment schemes, their improvement, and formulationof new schemes.
- Mission II, concerning the technical and economic optimizationand the establishment of the master plan lasting eight months and including:
Sub-missionII-A: Technicaland economic optimizationstudy to define the most effectivescheme among the ones selected at the end of Mission I.
Sub-missionII-B: Pre-feasibilitystudy of selected works.
Four more missions were added to the initial contract:
Missions III and IV, subject of Amendment No. 1 approved on October 8, 1986. These missions concerned an integratedmaster plan study for the water resource developmentof the Tensift Basin and the coastal Essaouira Basins. This area has been linked to the Sebou, Bou Regreg, and Oum Er- R'bia areas because of their water resource interdependence.Missions III and IV were divided into sub-missionsas were Missions I and II.
Mission V was subject of Amendment No. 2, approved on November 25, 1988. This mission was added to reinforcethe project management team in view of the importanceof the studies and to update the hydrogeologicalsituation in the area under study.
By the loan closing date, Mission I studieswere completedand approvedby the Hydraulics Administration, except for the report concerning preliminary hydraulicworks for water transfer,which is still in draft. At the end of this mission, scenariosfor developingwater resourcesto be studiedunder Mission II were selected during a coordination meeting held in June 1989 between the Ministry of Public Works and the Ministry of Agriculture and Agrarian Reform.
Mission II was launched by a methodology note during October 1989. - 61 -
Reports of Mission III including four sub-missions (III-A, III-B, III-C and III-D) were also prepared, except for the report on Water Quality and Water re- use of sub-mission III-C, and reports of preliminary studies on a new dam location and the report on resources/needs of sub-mission III-D. Reports of sub- missions III-A and III-B were all approved , except for the "Pollution" report and the "Agriculture" report.
5.2.2 Integrated Master Plan Study for Water Resource Development of the MoulouVa Basin
The Integrated Master Plan Study for Water Resource Development of the Moulouya Basin aimed at defining an optimal scheme for the mobilization of underground water resources from technical and economic standpoints, taking into account their availability, technical, economic and social constraints, quantitative and qualitative nature of the demand, orientation, and objective of social and economic development plans at regional, national and sector levels, and environmental protection and conservation of hydraulic resources.
In addition to the Moulouya Basin, the area covered by the study included:
- the Oued Kert watershed located West of the Mediterranean area between the Moulouya mouth and the Trois Fourches Cape; and
- the Moroccan side of the Oueds Kiss and Isly watersheds located northwest of the Moroccan-Algerian border.
The contract for the study carried out by a joint venture was approved on August 13, 1985. The study also included two missions:
- Mission I, concerning the critical analysis of the existing situation, assessment of, and comparison between resources and water needs, and formulation of development schemes, lasting last eight months.
- Mission II, concerning the technical and economic optimization and the establishment of the master plan lasting four months.
By the loan closing date, December 31, 1989, all studies of Mission I had been completed and approved by the Hydraulics Administration. The first phase of Mission II concerning the technical and economic optimization and the establishment of the master plan had been practically completed. The engineer in charge of the study also made a field mission to collect data required for the second phase of Mission II regarding the pre-feasibility study of the works included in the plan.
5.2.3 Integrated Master Plan Study for Water Resource Development of the Loukkos, Tangier, and Mediterranean Coast Basins
The contract for the study signed with the group composed of one local and two foreign firms was approved on March 18, 1988. - 62 -
The integrated master plan study of water resource development for the Loukkos, Tangier, and Mediterraneancoastal basins aimed at defining an optimal scheme for the mobilization of undergroundwater resources from technical and economicstandpoints, taking into accounttheir availability,technical, economic and social constraints, quantitative and qualitative nature of the demand, orientation and objective of social and economic development plans at the regional, national, and sector levels, and environmental protection and conservation of hydraulic resources under different scenarios of demand development.
The other objective of the study was to establish the pre-feasibilityof integrated development projects for the supply of drinking, industrial, and irrigationwater, hydro-electricpower production,and protectionagainst floods.
The study was divided into two missions:
Mission I:
Sub-missionI-A: critical analysis of the existing situation.
Sub-missionI-B: water resource study.
Sub-missionI-C: water demand study.
Sub-missionI-D: resource/needsresults, critical analysis of medium- and long-term equipment schemes, their improvement, and formulationof new schemes.
Mission II:
Sub-missionII-A: Technicaland economic optimizationstudy to define the most effectivescheme among the ones selected at the end of Mission I.
Sub-missionII-B: Pre-feasibilitystudy of selected works.
The terms of the contractwere modified followingan amendmentapproved on November 5, 1990. The modificationsare as follows:
- expansion of the area under study to include the Souk El Arbaa of the Ghrab Center;
- expansionof the study horizon up to the year 2030 instead of 2020;
- increase of the number of preliminaryprojects for dams to establish under sub-missionI-D up to 17 projects instead of 15, of which a maximum of 13 new sites instead of 10; and
- extension of the duration of Mission I, to 14 months instead of eight in view of the increase of the scope of the study and the - 63 -
difficultiesencountered in collectingdata from the various sectors concerned.
The followingstudies were completed by the loan closing date:
- sub-missionI-A studies: analysis of the existing situation;
- sub-missionI-B studies: water resource assessment;
- sub-missionI-C studies: water demand assessment;and
- studies related to the pre-selectionof dam sites and preliminary projects for new dam sites (sub-missionI-D).
The resource/needsstudy of sub-missionI-D was almost completed.
5.2.4 Workshop on systems analysis applied to water resources
The contract signed with a foreign firm for the organizationof a workshop on systems analysis applied to water resourceswas approved in December 1988.
The workshop was organizedbetween June 12 and 23, 1989 for the cadres of the Planning and Water Management Division of DRPE and Service Chiefs of the Planning and Water Management of Hydraulics Regional Directorates.
After two days of theoretical courses on the application of systems analyuis to the planning of water resources, participantsmade simulationson micro-computers to analyze the behavior of the watershed CITARUM system in Indonesia.
6. Financina and Loan Disbursement
6.1 Part E: Water resource Development
The project cost has amounted to DH 15,444,808.67, i.e. 100% of the committedamount, 80% of which, i.e. DH 12,338,246.94,were financedby the World Bank, representingabout 59Z of the amount of the Part E of the loan (see Table No. 2).
6.2 Catexorv 4: ConsultantsServices and Training
At the loan closing date, December31, 1989, the level of paymentsamounted to DH 30,544,331.74,i.e. about 682 of the amounts committed at that date (See Table No. 2).
The amounts disbursedby the Bank amount to DH 17,859,955.67,i.e., about 40% of the amount of the loan for Category 4.
The implementationof the IntegratedMaster Plan Study for the Sebou, Bou Regreg, Oum Er-R'bia, and Tensift Basins experiencedsome delays which were - 64 - reflectedon the level of payments and disbursements. The main reasons for these delays were:
the particular nature of the study, which was the first of its kind to be launched by the Hydraulics Administration;
the extent of work to be accomplishedunder these studies and the complexityof problems related to the water resource developmentin the Sebou, Bou Regreg, and Oum Er-R'bia region. This region has, in fact, about 50% of the water resources of the whole country and concentrates55% of irrigable land and 80% of national processing industries;
the lack of preparation of the user sectorswhich do not answer in a timely manner requests for data made during the execution of the first studies;
slow review of reports by user sectors, in view of the large number of services and consequent delay in decision making regarding the orientationof the studies. - 65 -
TABLE 1: Sunmmaryof Project Works
Throughput (Liter per second) Bore- size Province Center holes Wells Total (in meters) Wth Air Pumpig
SAFI CHEMAIA 6 2 8 635 25 210
IFRANE AZROU 6 1 7 506 48 44
KHENIFRA MIDELT 6 1 7 1078 50 85
MARRAKECH IMINTANOUT 2 0 2 205 26
ESSAOUIRA TAMANAR 0 1 1 305 ESSAOUIRA 0 1 1 111 112
LARACHE LARACHE 0 2 2 184 87
SETrAT EL GARA 0 1 1 55 60 BEN AHMED 0 2 2 112 70
TAZA GUERCIF 0 3 3 322 58 136 l. AMLIL 0 2 2 478 14
KHOURIBGA GOUFAF 0 1 1 75.5 11.5
OUJDA BERKANE 0 1 1 148.5 55
AZILAL TANANT 1 0 1 500 9 lAZILAL 0 1 1 1,007 S0
TOTAL 15 21 19 40 5,722 206 934.5 - 66 -
TABLE 2: Summary of Contracts Fmanced under Loan 2006-MOR
(in DH)
Commitments Payments Loan Disbursements (December31, 1989 (December31, 1989) (December31, 1989)
1 - Part E Construction and equipment of borehoLesand weLLswith infiLtration gaLleries 15.422.808,67 15.422.808,67 12.338.246,94
2 - Category4 MasterpLan studyfor Moulouya 6.887.975,87 6.459.370,78 4.024.377,96 Masterplan studyfor Sebou,Bou Regreg,and Oum Er-R'bia 28.665.586,11 19.336.487,30 11.405.713,90 Masterplan studyfor Loukkos, Tangier,and Mediterraneancoastal basins 8.895.649,25 4.652.423,39 2.351.134,08 Workshopon systemsanaLysis appLied to waterresources 486.303,10 96.050,27 78.729,73 SubtotaLCategory 4 44.935.494,33 30.544.331,74 17.859.955,67 Total 60.358.303,00 45.967.140,41 30.198.202,61 - 67 -
MOROCCO
THIRD WATER SUPPLY PROJECT (Loan 2006-MOR)
PART HI: STATISTICAL INFORMATION - 68 -
Table 1: Related Bank Loans
Loan Number and Title Purpose FY Status
Loan 850-MOR Financing of the first phase construction program 72 Completed First Water Supply of water storage, production, and transmission PAR #3721 Project facilities along the Mid-Atlantic Coast, as well as 12/16/81 for ONEP's training center and a nationwide tariff study. Loan (S-7 MOR) Provision of foreign exchange for the preparation 77 Completed Engineering Loan to the of a feasibility study, including preliminary PCR #5131 Sewerage Sector designs for the sewerage facilities in the 6/14/84 Casablanca-Mohammedia area.
Loan 1724-MOR Expansion of bulk water production and 79 Completed Second Water Supply transmission facilities along the Mid-Atlantic PAR #8725 Project Coast, as well as for the Greater Agadir area and 6/08/90 funds for credit facilities to finance house connections and related charges for low-income customers.
Loan 2820-MOR Rationalization of the complex set of institutional 87 Completed Public Enterprise relationships between the Government and its PCR, 2/91 Rationalization Loan enterprises to promote public enterprise financial autonomy and accountability, enhance their managerial autonomy, and rationalize the role of the state in the economy.
Loan 2825-MOR Rehabilitation of the existing installations to 87 Ongoing National Water Supply increase the quantity of water available for Rehabilitation Project distribution and reduce operating costs, and improvement of overall sector management and investment planning through the creation of a Higher Water Council and a sector investment coordinating committee, and the enforcement of a water code.
Loan 2826-MOR Prevention of further deterioration of the existing 87 Ongoing Greater Casablanca sewer systems in the Greater Casablanca area Sewerage Project through an extensive rehabilitation program, and promotion of the establishment and development of appropriate institutional, financial, and technical structures to manage sewerage services in major urban centers. - 69 - Table 2: Project Timetable
Planned Revised Actual
Identification 06/79
PreparationBeginning 08/79
PreparationEnd 10/80 11/80
Pre-appraisalMission 09/80 10/80
Appraisal Mission 09/80 11/80
Loan Negotiations 03/81 04/81
Board Approval 05/81 05/28/81
Loan Signature 09/28/81
Loan Effectiveness 10/31/81 03/15/82
Loan Closing 12/31/86 12/31/87 12/31/89 12/31/88
Project Completion 12/31/85 12/31/86 04/30/90 12/31/88 09/30/89 - 70 - Table 3: Cumulative Loan Disbursements
(USD millions)
Actual Original vs. Quarter Estimate Actual Estimated
Dec. 1981 l Jun. 1982 0.4 - -
Dec. 1982 6.4 0.8 13% Jun. 1983 15.2 4.3 28% FY84 Dec. 1983 27.6 7.8 28% Jun. 1984 41.1 11.4 28% IFY85 Dec. 1984 53.8 14.9 28% Jun. 1985 76.2 19.4 29% EY-M Dec. 1985 79.3 23.3 29% Jun. 1986 85.7 27.6 32%
FY 87 Dec. 1986 87.0 30.5 35% Jun. 1987 34.3 39%
Dec. 1987 40.6 47% Jun. 1988 46.9 54%
Dec. 1988 51.3 59% Jun. 1989 58.4 67%
Dec. 1989 63.2 73% Jun. 1990 78.0 90% Table 4: Project CostQ
(USD milion)
APPRAISAL ACTUAL .
______Local Foreign otal fLocal -Foreign: Totaltna - a iatio
Une of Credit and Regional water supply systems 54.06 28.91 82.97 39.39 19.98 59.37 (23.60) 72% Equipment and materials 1.93 2.25 4.19 4.52 5.75 10.27 6.08 245% Water resource development 2.85 3.57 6.42 2.10 2.63 4.73 (1.69) 74% Consulting services, technical assistance and studies 0.24 9.70 9.94 0.00 3.84 3.84 (6.10) 39%
Fund for house connections 5 (a) ONEP 2.38 4.42 6.80 1.59 3.70 5.29 (1.51) 78% (b) Regies 20.54 38.15 58.69 11.54 42.10 53.64 (5.05) 91%
TOTAL 82.00 87.00 169.00 59.13 78.00 3 317 7 Table 5: Project Financing
(USDmilion)
APPRAISAL ____ ACTUAL
v : ; :-:-- - ::---- vern-Gove::rn:::--::----:-.::: -ONE : FEC:--:: :-k : N-P:- -- - .n- Lne of Credit and Regionalwater supply systems 6.58 47.48 28.91 6.58 32.81 19.98 Equipment and materials 1.93 2.25 0.85 3.67 5.75 Water resource development 2.85 3.57 2.10 2.63 Consulting services, technical assistance and studies 0.24 9.70 3.84
Fund for house connections (a) ONEP 2.38 4.42 1.59 3.70 (b) Regies 20.54 38.15 11.54 42.10 Total :-:10.8 9 11 3 Table 6: Status of Compliance with Covenants
Page I of 2 jLoanlProject
Agreement _ Reference Description Status of Compliance
LA 3.02 (a) Completion of Water Supply Sector Study, by April 1982. Deferred to the ongoing National Water Supply Rehabilitation Project and tariff study updated under the Public Enterprise Rationalization Loan.
LA 3.02 (a) Completion of Water Resource Development Studies in Complied with in December 1984. coastal area, by December 1983.
LA 3.02 (a) Completion of Rural Water Supply Study, by June 1983. Complied with in June 1985.
LA 303 (a) Employment of consultants by ONEP for studies of rurl Complied with in January 1983. water supply systems, by December 1982.
LA 303 (b) Initiation of recommendations of sector study, by June 1983. New tariff study carried out under Public Enterprise Rationalization Loan.
LA 305 (a) Progress reports on the house connection program, water Enforcement deferred to the ongoing National Water Supply resource development, and studies. Rehabilitation Project.
LA 307 Agreements between ONEP and the Govemment for two Complied with in June 1986. regional water supply systems, by December 1982.
LA 4 Certification of financial comptroller of appropriate use of Complied with in December 1987. loan proceeds, by December 1987.
Amendment to Opening of special account, by March 1987. Special Account was never opened. LA 202
SL 3 Provision of funds for Rurl Water Systems Study, by Complied with in December 1987. December 1986. Table 6: Status of Compliance with Covenants
Page 2 of 2
Loan/Project Agreement Reference Description Status of Compliance
PA 202 (a) Employment of consultants for final design and bid Complied with in September 1982. documents, by September 1982.
PA 202 (a) Employment of experts for strengthening performance, by Complied with in December 1982. September 1982.
PA 203 (a) Employment of consultants by ONEP for studies of rural Complied with in February 1982. water supply systems, by January 1982.
PA 204 Agreements between ONEP and the Government for two Complied with in June 1986. regional water supply systems, by December 1982
PA 207 (b) Quarterly progress reports submitted by ONEP, beginning in Complied with. June 1988.
PA 305 (a) Employment of experts by ONEP for inventory of assets, by Complied with in June 1986. September 1982.
PA 403 Establishment of a list of appropriate indicators to monitor Complied with in January 1982. operating efficiency, by October 1981.
PA 404 (a) ONEP working ratio not exceeding 66%, by December 1987. Complied with in December 1984.
PA 404 (c) Preparation of forecast of revenues and operating cost for Complied with in October 1987. reviewing adequacy of tariffs, by October 1987.
PA 405 Debt service coverage ratio of at least 1.3. Complied with. - 75 - Table 7: Missions
Slat. ' le S" ciali'"tio: .... - Cycle Year ... Staff Field~ ~~Represented Ratin,s ...... Identification 07/79 2 10 Sanitary engineer Preparation 10/79 4 21 Financial analyst Sanitary engineer Economist 05/80 3 20 Sanitary engineer Financial analyst Economist Pre-Appraisal 09/80 2 24 Sanitary engineer Financial analyst Appraisal 11/80 5 17 Sanitary engineer Loan officer Financial analyst Economist 09/81 1 12 Sanitary engineer Supervision 01/82 2 4 Sanitary engineer Financial analyst 06/82 2 4 Sanitary engineer 1 Financial analyst 1 11/82 2 14 Sanitary engineer Financial analyst 1 02/83 2 5 Sanitary engineer Financial analyst 2 Financial 06/83 2 5 Sanitary engineer Managerial Financial analyst 2 Financial 11/83 1 14 Financial analyst Managerial 03/84 3 24 Sanitary engineer 2 Financial Financial analyst Managerial Procurement engineer 2 Financial 09/84 3 18 Sanitary engineer 2 Financial Financial analyst Managerial Procurement engineer 04/85 2 17 Sanitary engineer 2 Managerial Financial analyst 04/86 3 14 Sanitary engineer Financial analyst 2 Financial Economist Managerial 12/86 2 14 Sanitary engineer 1 Financial Financial analyst Managerial 10/87 3 14 Sanitary engineer Financial analyst 1 03/88 1 25 Sanitary engineer 08/88 2 17 Sanitary engineer 1 Financial analyst 10/88 2 17 Sanitary engineer 2 Financial analyst 2 Financil 06/89 1 17 Sanitary engineer 11/89 2 14 Sanitary engineer 2 Financial Financial analyst 05/90 2 21 Sanitary engineer 2 Financial Financial analyst Completion 11/91 1 14 Sanitary engineer 2 Financial
1/ 1 - Problem free or minor problems. 2 - Moderate problems. 3 - majorproblem; which are being addressed. 4 - Major problems; which are not being addressed. - 76 - Table 8: Staff Inputs
(Staff Weeks)
Loan Preparation Appraisal Negotiations Processing Supervision PCR -T:-. To FY 83 47.7 38.2 10.6 13.3 26.2 136.0 FY 84 17.7 17.7 FY 85 14.2 14.2 FY 86 8.2 8.2 FY 87 18.7 18.7 FY 88 12.7 12.7 FY 89 10.2 10.2 FY 90 7.4 7.4 FY 91 0.0 FY 92 0.8 0.8 FY 93 3.8 3.8 Total - - --47.7 382 10.6 13.3 115-.3 - 4.6 229.7
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