Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No: PAD1275 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN Public Disclosure Authorized IN THE AMOUNT OF USD 40.89 MILLION TO THE REPUBLIC OF CHILE FOR THE INTEGRATED WATER RESOURCES MANAGEMENT AND INFRASTRUCTURE DEVELOPMENT PROJECT Public Disclosure Authorized October 15, 2015 Water Global Practice Latin America and the Caribbean Region This document has a restricted distribution and may be used by recipients only in the Public Disclosure Authorized performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective as of May 30, 2015) Currency Unit = Chilean Peso (CLP) CLP 618.09 = USD 1 FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS ANI National Investment Agency (Agencia Nacional de Inversión) AOP Annual Operational Program BP Bank Procedures CAS Groundwater Users Association (Comunidad de Aguas Subterráneas) CBR Property Registrar (Conservador de Bienes Raíces) CCOP Concession Coordination Unit for Public Works (Coordinación de Concesiones de Obras Publicas) CIRH Center for Information on Water Resources (Centro de Información de Recursos Hídricos) CGR Supreme Audit Institution (Contraloría General de la República de Chile) CODELCO National Copper Corporation (Corporación Nacional de Cobre) CONADI National Commission for Indigenous Development (Corporación Nacional de Desarrollo Indígena) CPA Public Water Rights Registry (Catastro Público de Aguas) CPS Country Partnership Strategy CQS Selection Based on Consultant’s Qualifications DA Designated Account DC Direct Contracting DGA Directorate-General for Water (Dirección General de Aguas) DOH Hydraulic Infrastructure Directorate (Dirección de Obras Hidráulicas) DPL Development Policy Loan EMF Environmental Management Framework ENDESA National Electricity Company (Empresa Nacional de Electricidad S.A.) FA Framework Agreement FBS Fixed Budget Selection FMA Financial Management Assessment GIS Geographic Information System GP Good Practices GPD Gross Domestic Product GRS Grievance Redress System IBRD International Bank for Reconstruction and Development ICB International Competitive Bidding ICOLD International Commission for Large Dams ICT Information and Communication Technology IDA International Development Association IFAC International Federation of Accountants IFC International Finance Corporation IFR Interim Financial Report ISA International Standards on Auditing IWRM Integrated Water Resources Management JV Water user organization (Junta de Vigilancia) LAC Latin America and the Caribbean LCS Least Cost Selection M&E Monitoring and Evaluation MIDESO Ministry of Social Development (Ministerio de Desarrollo Social) MOP Ministry of Public Works (Ministerio de Obras Publicas) NCB National Competitive Bidding NOAA National Oceanic and Atmospheric Administration OECD Organization for Economic Co-operation and Development O&M Operation and maintenance ONEMI National Office of Emergency of the Interior Ministry (Oficina Nacional de Emergencia del Ministerio del Interior) OP Operational Policy OSITRAN Public Transport Infrastructure Regulatory Organization (Organismo Supervisor de Infraestructura de Transporte de Uso Público) QCBS Quality and Cost Based Selection QBS Quality Based Selection PGIRH Integrated Water Resources Management Plan (Plan de Gestión Integral de Recursos Hídricos) PDO Project Development Objective PPP Public-Private Partnership RPA National Property Registry for Water (Registro de Propiedad de Agua) SAFI Financial and Contract Management System (Sistema de Administración Financieray de Contratos) SAG Agricultural and Livestock Service (Servicio Agrícola y Ganadero) SEPA Procurement Plan Execution System SERNAGEOMIN National Mining and Geology Service (Servicio Nacional de Geología y Minería) SICOF Accounting and Financial Information System (Sistema de Información Contable Financiero) SNIA National Information System for Water (Sistema Nacional de Información de Agua) SSS Single Source Selection TAL Technical Assistance Loan TORs Terms of Reference WUO Water Users Organization WRM Water Resources Management Regional Vice President: Jorge Familiar Country Director: Alberto Rodriguez Senior Global Practice Director: Junaid Kamal Ahmad Practice Manager: Wambui G. Gichuri Task Team Leaders: Marie-Laure Lajaunie and Javier Zuleta CHILE - INTEGRATED WATER RESOURCES MANAGEMENT AND INFRASTRUCTURE DEVELOPMENT PROJECT TABLE OF CONTENTS Page I. STRATEGIC CONTEXT .................................................................................................1 A. Country Context ............................................................................................................ 1 B. Sectoral and Institutional Context ................................................................................. 2 C. Higher Level Objectives to which the Project Contributes .......................................... 4 II. PROJECT DEVELOPMENT OBJECTIVES ................................................................5 A. PDO............................................................................................................................... 5 B. Project Beneficiaries ..................................................................................................... 5 C. PDO Level Results Indicators ....................................................................................... 5 III. PROJECT DESCRIPTION ..............................................................................................5 A. Project Components ...................................................................................................... 5 B. Project Financing .......................................................................................................... 7 C. Lessons Learned and Reflected in the Project Design .................................................. 8 IV. IMPLEMENTATION .....................................................................................................10 A. Institutional and Implementation Arrangements ........................................................ 10 B. Results Monitoring and Evaluation (M&E) ................................................................ 10 C. Sustainability............................................................................................................... 10 V. KEY RISKS ......................................................................................................................11 VI. APPRAISAL SUMMARY ..............................................................................................12 A. Economic and Financial (if applicable) Analysis ....................................................... 12 B. Technical ..................................................................................................................... 13 C. Financial Management ................................................................................................ 14 D. Procurement ................................................................................................................ 15 E. Social (including Safeguards) ..................................................................................... 15 F. Environment (including Safeguards) .......................................................................... 16 G. World Bank Grievance Redress .................................................................................. 17 Annex 1: Results Framework and Monitoring .........................................................................18 Annex 2: Detailed Project Description .......................................................................................24 Annex 3: Implementation Arrangements ..................................................................................36 Annex 4: Implementation Support Plan ....................................................................................46 Annex 6: Map – IBRD 41695 ......................................................................................................69 . PAD DATA SHEET Chile CL Integrated Water Resources Management & Infrastructure Development (P152319) PROJECT APPRAISAL DOCUMENT . LATIN AMERICA AND CARIBBEAN GWARD Report No.: PAD1275 . Basic Information Project ID EA Category Team Leader(s) P152319 B - Partial Assessment Marie-Laure Lajaunie, Javier Zuleta Lending Instrument Fragile and/or Capacity Constraints [ ] Investment Project Financing Financial Intermediaries [ ] Series of Projects [ ] Project Implementation Start Date Project Implementation End Date 16-Nov-2015 04-Jan-2021 Expected Effectiveness Date Expected Closing Date 04-Jan-2016 04-Jan-2021 Joint IFC No Senior Global Practice Practice Manager Country Director Regional Vice President Director Wambui G. Gichuri Junaid Kamal Ahmad Alberto Rodriguez Jorge Familiar . Borrower: Ministry of Finance Responsible Agency: Ministry of Public Works Contact: Sergio Galilea Title: Undersecretary of Public Works Telephone No.: 560224494000 Email: [email protected] . Project Financing Data(in USD Million) [ X ] Loan [ ] IDA Grant [ ] Guarantee [ ] Credit [ ] Grant [ ] Other Total Project Cost: 45.17 Total Bank Financing: 40.89 Financing Gap: 0.00 . Financing Source Amount Borrower 4.28 International Bank for Reconstruction and 40.89 Development Total 45.17 . Expected Disbursements (in USD