The World Bank TRANSPORT RESILIENCE PROJECT (P172988) Public Disclosure Authorized Public Disclosure Authorized Project Information Document (PID) Concept Stage | Date Prepared/Updated: 11-Dec-2020 | Report No: PIDC30417 Public Disclosure Authorized Public Disclosure Authorized Dec 11, 2020 Page 1 of 14 The World Bank TRANSPORT RESILIENCE PROJECT (P172988) BASIC INFORMATION A. Basic Project Data OPS TABLE Country Project ID Parent Project ID (if any) Project Name Burundi P172988 TRANSPORT RESILIENCE PROJECT (P172988) Region Estimated Appraisal Date Estimated Board Date Practice Area (Lead) AFRICA EAST Jul 29, 2021 Dec 16, 2021 Transport Financing Instrument Borrower(s) Implementing Agency Investment Project Financing Ministry of Finance, Budget Ministry of Trade, Transport, and Planning Industry and Tourism, Ministry of Infrastructure, Equipment and Housing Proposed Development Objective(s) is to facilitate efficient, safe and sustainable movement of people and goods along targeted roads and improve the capacity of the road sector in Burundi. PROJECT FINANCING DATA (US$, Millions) SUMMARY-NewFin1 Total Project Cost 65.00 Total Financing 65.00 of which IBRD/IDA 65.00 Financing Gap 0.00 DETAILS-NewFinEnh1 World Bank Group Financing International Development Association (IDA) 65.00 IDA Credit 65.00 Environmental and Social Risk Classification Concept Review Decision Dec 11, 2020 Page 2 of 14 The World Bank TRANSPORT RESILIENCE PROJECT (P172988) Substantial Track II-The review did authorize the preparation to continue Other Decision (as needed) B. Introduction and Context Country Context 1. Burundi is a small landlocked mostly hilly country in eastern central Africa with a total land area of 27,834 square kilometers and is the second most densely populated low-income country (LIC) of sub-Saharan Africa (SSA) with a population of about 11 million inhabitants, of which half are youth. Burundi has also the most densely populated rural areas in the world (423 people per km2 in 2017) and a low urbanization level (12 percent). About 58 percent of the population is below 19 years old. Economic growth is largely dependent on agriculture, accounting for about 32 percent of the Gross Domestic Product (GDP) and 90 percent of livelihoods. Over the past decade, Burundi has enjoyed a GDP growth of about 4 percent per annum, mainly due to improved agricultural performance. 2. Years of conflict hampered growth of Burundi's economy. Burundi remains among the ten poorest countries in the world, with a GDP of US$310 per inhabitant in 2019 and a Human Capital Index (ICH) of 0.38 amongst the lowest in the world. Burundi’s development has been delayed by the consequences of political and social instability and natural disasters. Tension between the country’s two main ethnic groups - exacerbated by land scarcity issues – erupted in a civil war in 1993, which ended in 2006. The impact of this war on the economy and human lives was devastating (“mass poverty”) on the population. Between 2006 and 2012 the share of poor population dropped at 6 percent from 60 percent in 2017. Poor people’s income remains mainly dependent directly or indirectly on farming. 3. Economic growth and poverty reduction have been severely constrained by repeated climate and disaster shocks. Burundi has a history of extreme climate‐related events, but its capacity to respond to related shocks remains very low. It is the 18th most vulnerable country and the 19th least ready country in the world when it comes to combating climate change effects and coping with natural disasters such as droughts, wildfires, floods, and landslides. From 1971 to 2015, Burundi’s population had to cope with a decade of climate shocks, leading to a contraction of agricultural output. These repeated shocks put the country in an extremely vulnerable position and constrained economic growth. Burundi has experienced changes in the duration of wet and dry seasons with intensification of severe drought and flood risks. Mean annual temperature is 20.02°C (1901-2016) and it has increased by 0.7-0.9°C since the 1930's. Mean annual temperatures are projected to increase by 2.1°C by 2050.Mean annual rainfall is also projected to increase by mid and late 21st century1. 4. The capital city, Bujumbura, concentrates more than 75 percent of the urban population with an estimated 800,000 inhabitants in 2020. Over the last three decades, Bujumbura sprawled rapidly, from about 37 km2 in 1 Climate change profile – Burundi; Ministry of Foreign Affairs; April 2018 Dec 11, 2020 Page 3 of 14 The World Bank TRANSPORT RESILIENCE PROJECT (P172988) 1983 to over 100 km2 in 2020. This rapid expansion was, however, not accompanied by proper land use planning and watershed management, creating a complex hydrological situation. 5. In Burundi, gender inequalities remain pervasive for women’s access to employment, professional opportunities, and wage gaps. According to the World Bank Group Burundi Systematic Country Diagnostic (2018), women’s employment is largely concentrated in unpaid work in low-productivity sectors such as agriculture. While women account for 52.7 percent of the workforce, more women than men work in farming. Moreover, 71.2 percent of women are unpaid while only 28.5 percent of men are. Similarly, more men (18.6 percent) than women (7.2 percent) have waged jobs. Youths aged 15–24 make up 18 percent of the Burundian population of about 11 million and account for most entrants into the labor market. About 150,000 of them enter each year, but most work as family helpers, independent workers, or manual labor, with low incomes. Impact of the COVID-19 Pandemic and Government Response 6. In the face of the COVID-19 (coronavirus) pandemic, the country has put in place mechanisms to mitigate the spread of the virus, including closure of the Bujumbura International Airport, mass COVID-19 screening, training for health care personnel and the establishment of care centers for those who test positive. COVID-19 is expected to generate repercussions on Burundi's economy, which is facing a double shock of supply and demand. Sectoral and Institutional Context 7. Transport is critical for the economic development, peace, and stability of Burundi, a landlocked and post- conflict country whose population is almost exclusively rural (90%). To enable the transformation of its economy and enhance its competitiveness, the National Development Plan 2018 - 2027 targets the option of establishing a rational and integrated organization of the various modes of transport, reducing the country's internal and external isolation, meeting the needs of the productive sectors, irrigating the territory and consolidating Burundi's physical integration in the subregion. 8. Since the 2005 political crisis, the transport sector has received significant support from Technical and Financial Partners (TFP). In addition to the World Bank, several other development partners support the transport sector: the African Development Bank (ADB), the European Union (EU), the Arab Funds (BADEA, Kuwait Fund, Saudi Fund, and OFID), the Japan International Cooperation Agency (JICA), and the Belgian Technical Cooperation (BTC). 9. Regional connectivity is essential for Burundi to gain in competitiveness and improved integration into the regional and global market. Connectivity is essential for trade and marketing of agricultural products, agribusiness value chain development for livelihood and jobs, particularly for women. Furthermore, transport costs in Burundi are aggravated by Non-Tariff Barriers (NTBs), poor logistics and efficiencies, as well as burdensome cross-border customs and other administrative procedures. The high costs of infrastructure development, coupled with equally high transport costs, are major constraints to growth, especially for the predominantly agricultural economy. Dec 11, 2020 Page 4 of 14 The World Bank TRANSPORT RESILIENCE PROJECT (P172988) 10. The improvement of international corridors is critical to sustain trade and economic competitiveness. Road transport carries about 90 percent of goods in Burundi through following international land route (i) the Northern Corridor to the port of Mombasa, (ii) the Central Corridor to Dar-es-Salaam, and (iii) the Southern Corridor to Southern Africa. The Northern Corridor is mainly composed of a road route that passes through Rwanda and Uganda before reaching the Port of Mombasa. The Port of Mombasa may be joined by an alternative road that passes through the city of Arusha in Tanzania, but this road is not often used. 11. The Central Corridor from the port of Bujumbura to the port of Dar- Es-Salam contributes about 70% of Burundi's trade. The Central Corridor is composed of two modal alternatives; (i) one is entirely road from Bujumbura to Dar-es-Salam ; (ii) and the other is lake/rail connection composed of a lake haul that connects the Port of Bujumbura to the Port of Kigoma in Tanzania and then of a railway to Dar es Salaam. The Southern Corridor also consists of a lake road that connects Bujumbura to the other ports in the DRC and in Zambia and to ports in Southern Africa by road and rail. This Corridor is constituted by road via Tanzania to Zambia and the other countries of Southern. This Central and southern corridor is vital corridor for the Burundian economy, and this necessarily involves strengthening the coordination and cooperation relations with the Tanzanian authorities. Its potential could be further strengthened with the rejuvenation of the lake transport and ports rehabilitation in Burundi, Tanzania and Zambia (Zambia). 12. Insufficient maintenance of road network. The road network is relatively dense2 with a length of 11,000 km including 1,950 km of National Roads (NR) out of which 1,500 km are paved, 2,500 km of Provincial Roads, 6,500 km of Rural Roads and 450 km of Urban Roads. About 12 percent of the road network is in good condition. Road maintenance falls under the responsibility of the National Road Agency (NRA) through the National Road Fund (NRF).