RESTRICTED Report No. PTR-94a Public Disclosure Authorized Thisreport is for officialuse only by theBank Gzoup and specifically authorized organîzations or persons.It may not be published,quoted or cîted without BankGroup authorization.The BankGroup does not acoeptresponsbillty for the accuracyor completenessof the report. INTERNATIONAL BANK FOR RECONSTRUCTIONAND DEVELOPMENT INTERNATIONAL DEVELOPMENTASSOCIATION Public Disclosure Authorized APPRAISAL OF A SECOND HIGHWAY PROJECT SYRIA Public Disclosure Authorized February 23, 1972 Public Disclosure Authorized Transportation Projects Department Ourrency Eauivalents Currency Unit = Syrian Pound (SL) US$1.00 = SL 3.82 SL 1 = US$0.26 SL 1 million = US$261,800 Fiscal Year January 1 - Decomber 31 System of Weights and Neasures: Metric Metric British/US 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 mile (mi) 1 square kilometer (ko2) = 0.386 square mile (sq mi) 1 hectare (ha) 5 2.47 acres (ac) l liter (1) = 0.22 British gallon (impgal) = 0.26US gallon (gal) 1 kilogram (kg) = 2.2 pounde (lb) 1 metric ton (m ton) = 2,204pounds (lb) Abbreviations and Acroriyms ADT - AverageDaily Traffic CITE - Compagnied'Ingenieurs et Techniciens d'Etudes (consultants, France) DHB - Directorate of Highwaysand Bridges IER - InternalEconomic Return ILO - International Labor Organization OPAS - Operational Assistance Program (UNDP-financed) SCET - Societe Centrale pour lEquipement du Territoire (consultants, France) UNDP - United Nations Development Programme NOTE: This report takes into account the effects of the recent currency parity changes. APPRAISAL OF A SECOND HIGRWAY PROJECT SYRIA TABLE OF CONTENTS Page No. SIJMMARYAND CONCLUSIONS .......................... i T. INTRODUCTION ..................................... 1 Il. BACKGROUND................. 2 A. General ..................................... 2 B. The Transport Sector ................ ......... 3 C. Transport Policy and Coordination .... ....... 5 III. TIE HIGHWAY SECTOR ...... ............... 7 A. The Highway Network and Its Traffic ......... 7 B. Highway Administration ...................... 8 C. Highway Financing and Planning .... .......... 8 D. Highway Engineering ......................... 9 E. Highway Construction ........................ 10 F. Highway Maintenance ......................... 10 IV. THE PROJECT ...................................... il A. General ..................................... il B. Highways to be Improved and Constructed 12 C. Consulting Services ......................... 13 D. Cost Estimates, Financing and Disbursement .. 13 E. Execution ................................... 15 V. ECONOMIC EVALUATION .............................. 16 A. Ceneral ..................................... 16 B. Benefits from the Project ..... .............. 16 C. The Project Roads ........................... 17 VI. AGREEM.NTS REACHED AND RECOMMENDATION............ 19 This report was written by Messrs. R. Paraud (engineer) and N. Kanaan (economist) on the basis of an appraisal mission in May 1971. -2- TABLES 1. Transport of Regional Transit Cargo on Syrian Highways - 1967 2. Freight Transport by Mode - 1965-69; Passenger Transport by Mode - 1965-69 3. Ports and Air Movements 1965-69 4. Vehicle Registration1965-69 5. Highway Network 1966-69 6. Gasoline Consumption 1960-69 7. Estimates of Revenues from Road Users 1966-69 8. Highway Expenditures1965-69 9. Design Standards for Project Highways 10. Breakdown of ConstructionCost Estimates 11. Unit Vehicle Operating Costs (per km) 12. SensitivityAnalysis of Internal Economie Returns 13. Traffic on Project Roads - 1970 ANNEXES A. Problems Encounteredin the First Highway Project B. Schedule of Estimated Disbursements CHART OrganizationChart of the Ministry of Communicationsand of the Direc- torate of Highways and Bridges MAP Highway System APPRAISAL OF A SECOND HIGHWAYPROJECT SYRIA SUMMARYAND CONCLUSIONS i. Syria's geographicallocation on the eastern shore of the Mediter- ranean sea and astride the main trade routes between Asia and Europe deter- mines its transportpattern. Syrian highways serve trafficbetween Jordan, Kuwait, Saudi Arabia, Iraq and other points to the east, as well as its own and Lebanese ports. The highway system has served both the country and the region reasonablywell, but traffic increasesand the developmentof new economic centers necessitatethe upgradingof most of the main highway net- work and the constructionof new roads. ii. This will be the Second Highway Project in Syria. Under the First Highway Project (HighwayImprovement Project, Credit 46-SYR, 1963), IDA pro- vided US$8.5 million equivalent for the improvementof the Damascus-Aleppo- Raqqa road, the purchase of maintenanceequipment, and consulting services to prepare a program to reorganize the Departmentof Highways and Bridges (DHB), as well as for a survey of the Syrian road network and the detailed engineeringof about 520 km of economicallyimportant roads. The proposed project is based on these studies. iii. Inadequate engineeringpreparation led to delays and problems in the executionof the Firet Highway Project; much more extensiveand costly improvementswere needed than originallyenvisaged for the Damascus-Aleppo- Raqqa road, and design changes during constructioncaused additionaldelays. Works are now progressingwell and are scheduled for completionby late 1973. It was after experiencewith this and other similar projects that the Bank in 1964 adopted the policy of lending for highways only when detailed engineering is well advanced. iv. The consultantssubmitted their recommendationsfor DHB's organi- zation in 1967, but although importantsteps have been taken, implementation has been slow. The formal establishmentof a CentralMaintenance Department, which will be a conditionof credit effectiveness,la expected to take place by mid-March 1972. Procurementof maintenanceequipment under the First Highway Project was also slow, but invitationsto bid for its supply have now been issued. v. In spite of the initialdifficulties and delays, the Firet Highway Project as a whole is now proceeding reasonablywell; DHB has been receptive to the Association'srecommendations, and a basis exists for further lending for highways. vi. The proposed project comprises: (a) the constructionand/or im- provementof three high priority roads (totallingabout 153 km) and (b) con- sulting services for supervisingconstruction, for studies and detailed engineeringof a main road and the bypasses for four major cities (totalling - il - about 540 km), as vell as for a study of maintenanceneeds. The project will cost US$28.7 million equivalent,and an IDA credit of US$13.8 million equivalent vill finance its foreign exchange component. vii. Contractsvill be awarded on the basis of internationalcompetitive bidding, and constructionsupervision and other expert services will be car- ried out by consultants. The Ministry of Communicationswill be responsible for project execution. viii. The internal economic returns (IER) from constructionof individual roads vary between 12% and 22Z: for the constructionwork as a whole, the IER is 18%. Benefits to the economy are derived from road user savings as a result of reductions in vehicle operating costs, and from the difference in maintenance costs between well constructedroads and the existing poor quality paved ones. ix. The project is suitable for an IDA credit of US$13.8 million equiv- alent. APPRAISALOF A SECONDUIGIWAY PROJECT SYRIA I. INTRODUCTION 1.01 The Governmentof Syria has requested the Associationto help fi- nance a project consistingof (a) the constructionand/or improvementof three main roads totallingabout 153 km, (b) consultingservices for super- vision of construction,for feasibilitystudies and, if justified,detailed engineeringfor city bypasses and one main road totalling about 540 km, and (c) consultingservices for a maintenanceneeds atudy. The total cost of the project is estimatedat about US$28.7 million. An IDA credit of US$13.8 million which would finance the foreign costs is proposed; local costs amount- ing to US$14.9 million equivalentwill be financedby the Government. 1.02 The First Highway Project (Credit46-SYR, 1963, US$8.5 million) provided for: (i) improvement of the Damascus-Aleppo-Raqqa road, including detailed engineering(about 540 km); (ii) reorganizationof the Departmentof Highways and Bridges (DHB), including provision of maintenance equipment; and (iii) a road network survey leading to the final survey and de- sign of about 520 km of priority roads. 1.03 The feasibilitystudies and detailed engineeringof the three roads now proposed for constructionand/or improvementwere financed under the Firet Highway Project and carried out by the French consultants,Societe Centrale pour l'Equipement du Territoire (SCET). SCET also carried out be- tween 1965 and 1969 the survey of the road network and the subsequent detailed engineeringof selected roads. SAUTI (Italy)are supervisingthe civil en- gineeringworks. Between 1965 and 1968, the French consultantsCompagnie d'Ingenieurset Techniciensd'Etudes (CITE) prepared the detailed engineering for the Danancus-Aleppo-Raqqaroad beîng constructedunder the Firet Righ- way Project, and studied IHB's reorganîzation. 1.04 The Associationhad appraisedthe First Highway Project on the basin of quite inadequateengineering preparation. As a result, the Damascus- Aleppo-Raqqa road had to be redesignedand further economic studies under- taken. Constructionworks were thereforedelayed and did not start on the first section until 1968. Tensions in the Middle