Completion Report Project Number: 37494 Loan Number: 2219 September 2014 People’s Republic of China: Hunan Roads Development III Project This document is being disclosed to the public in accordance with ADB's Public Communications Policy 2011. CURRENCY EQUIVALENTS Currency unit – yuan (CNY) At Appraisal At Project Completion (15 June 2005) (31 Dec 2012) CNY1.00 = $0.1210 $0.1587 $1.00 = CNY8.2700 CNY6.3026 ABBREVIATIONS ADB – Asian Development Bank EIRR – economic internal rate of return EMDP – ethnic minority development plan EMP – environmental management plan FIRR – financial internal rate of return GDP – gross domestic product HPTD – Hunan provincial transportation department ICB – international competitive bidding JECC – Hunan Jicha Expressway Construction and Development Co. O&M – operation and maintenance PRC – People’s Republic of China SEIA – summary environmental impact assessment TA – technical assistance WEIGHTS AND MEASURES ha – hectare km – kilometer m2 – square meter m3 – cubic meter mu – Chinese unit of measurement (1 mu = 666.67 m2) pcu – passenger car unit NOTE In this report, “$” refers to US dollars, unless otherwise stated. Vice-President S. Groff, Operations 2 Director General A. Konishi, East Asia Department (EARD) Director H. Sharif, People’s Republic of China Resident Mission (PRCM), EARD Team leader G. Xiao, Senior Project Officer (Transport), PRCM, EARD Team members H. Hao, Project Analyst, PRCM, EARD F. Wang, Senior Project Officer (Financial Management), PRCM, EARD W. Zhu, Senior Project Officer (Resettlement), PRCM, EARD Z. Ciwang, Associate Social Development Officer, PRCM, EARD N. Li, Environment Consultant, PRCM, EARD In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area. CONTENTS Page BASIC DATA i I. PROJECT DESCRIPTION 1 II. EVALUATION OF DESIGN AND IMPLEMENTATION 3 A. Relevance of Design and Formulation 3 B. Project Outputs 3 C. Project Cost 5 D. Disbursements 6 E. Project Schedule 6 F. Implementation Arrangements 6 G. Conditions and Covenants 7 H. Related Technical Assistance 7 I. Consultant Recruitment and Procurement 7 J. Performance of Consultants, Contractors, and Suppliers 8 K. Performance of the Borrower and the Executing Agency 8 L. Performance of the Asian Development Bank 8 III. EVALUATION OF PERFORMANCE 8 A. Relevance 8 B. Effectiveness in Achieving Outcome 9 C. Efficiency in Achieving Outcome and Outputs 10 D. Preliminary Assessment of Sustainability 10 E. Impact 11 IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 13 A. Overall Assessment 13 B. Lessons 14 C. Recommendations 14 APPENDIXES 1. Design and Monitoring Framework 16 2. Chronology of Major Events in the Project’s History 20 3. Project Costs and Financing Plan 21 4. Projected and Actual Contract Awards and Disbursements 22 5. Appraisal and Actual Implementation Schedules 24 6. Organization Charts 25 7. Status of Compliance with Loan Covenants 27 8. Details of Expressway Civil Works and Equipment Packages 36 9. Economic Reevaluation 37 10. Financial Reevaluation 41 11. Land Acquisition and Resettlement 45 12. Social, Poverty, and Ethnic Minority Development 51 13. Environmental Impact Analysis 57 i BASIC DATA A. Loan Identification 1. Country People’s Republic of China 2. Loan Number 2219 3. Project Title Hunan Roads Development III Project 4. Borrower People’s Republic of China 5. Executing Agency Hunan Provincial Transport Department 6. Amount of Loan $208.00 million 7. Project Completion Report PRC 1472 Number B. Loan Data 1. Appraisal – Date Started 15 June 2005 – Date Completed 20 June 2005 2. Loan Negotiations – Date Started 14 November 2005 – Date Completed 15 November 2005 3. Date of Board Approval 15 December 2005 4. Date of Loan Agreement 15 November 2006 5. Date of Loan Effectiveness – In Loan Agreement 13 February 2007 – Actual 02 February 2007 – Number of Extensions 0 6. Closing Date – In Loan Agreement 30 June 2012 – Actual 31 December 2012 – Number of Extensions 1 7. Terms of Loan – Interest Rate ADB's London interbank offered rate (LIBOR) – Maturity 25 years – Grace Period 5 years 8. Terms of Relending – Interest Rate ADB's London interbank offered rate (LIBOR) – Maturity 25 years – Grace Period 5 years – Second-Step Borrower Hunan provincial government 9. Disbursements a. Dates Initial Disbursement Final Disbursement Time Interval 8 August 2008 7 December 2012 52 months Effective Date Original Closing Date Time Interval 2 February 2007 30 June 2012 65 months ii b. Amount ($ million) Last Original Revised Amount Amount Undisbursed Category or Subloan Allocation Allocation Canceled Disbursed Balance Civil works, expressway 156.24 183.39 0.00 183.39 0.00 Civil works, local roads 8.00 8.00 0.00 8.00 0.00 Equipment 7.64 0.22 7.42 0.19 0.03 Consulting services and 1.51 1.11 0.00 1.11 0.00 training Interest and commitment 22.16 7.86 0.00 7.86 0.00 charges Unallocated 12.45 0.00 0.00 0.00 0.00 a Total 208.00 200.58 7.42 200.55 0.03 a The undisbursed $0.03 million was canceled at loan closing on 20 June 2013. 10. Local Costs (Asian Development Bank financed): 0.00 C. Project Data 1. Project Cost ($ million) Cost Appraisal Estimate Actual Foreign Exchange Cost 263.98 200.55 Local Currency Cost 255.53 697.54 Total 519.51 898.09 2. Financing Plan ($ million) Appraisal Estimate Actual Foreign Local Total Foreign Local Total Cost Exchange Currency Cost Exchange Currency Cost Implementation Costs Borrower-financed 55.98 236.37 292.35 0.00 651.31 651.31 ADB-financed 185.84 0.00 185.84 192.69 0.00 192.69 Subtotal 241.82 236.37 478.19 192.69 651.31 844.00 IDC Costs Borrower-financed 0.00 19.16 19.16 0.00 46.23 46.23 ADB-financed 22.16 0.00 22.16 7.86 0.00 7.86 Subtotal 22.16 19.16 41.32 7.86 46.23 54.09 Total 263.98 255.53 519.51 200.55 697.54 898.09 ADB = Asian Development Bank, IDC = interest during construction. 3. Cost Breakdown by Project Component ($ million) Appraisal Estimate Actual Foreign Local Total Foreign Local Total Component Exchange Currency Cost Exchange Currency Cost A. Base Cost 1. Expressway civil works 207.44 118.06 325.50 183.39 492.46 675.85 2. Equipment 7.64 10.07 17.71 0.19 15.50 15.69 3. Land acquisition and resettlement 0.00 31.96 31.96 0.00 58.80 58.80 4. Consulting services and training 1.51 4.78 6.29 1.11 7.96 9.06 5. Local roads 12.41 8.28 20.69 8.00 46.93 54.93 6. Project administration 0.37 20.95 21.32 0.00 29.66 29.66 7. Tax and duties 0.00 9.88 9.88 0.00 0.00 0.00 Subtotal (A) 229.37 203.98 433.35 192.69 651.31 844.00 iii Appraisal Estimate Actual Foreign Local Total Foreign Local Total Component Exchange Currency Cost Exchange Currency Cost B. Contingencies 1. Physical contingencies 12.45 12.35 24.80 0.00 0.00 0.00 2. Price contingencies 0.00 20.04 20.04 0.00 0.00 0.00 Subtotal (B) 12.45 32.39 44.84 0.00 0.00 0.00 C. Interest and Commitment Charges 22.16 19.16 41.32 7.86 46.23 54.09 during Construction Total 263.98 255.53 519.51 200.55 697.54 898.09 4. Project Schedule Item Appraisal Estimate Actual Date of Contract with Consultants November 2006 July 2007 Completion of Detailed Designs December 2005 December 2005 Civil Works Contract Date of award December 2006 August 2007 Completion of work December 2011 January 2012 Equipment and Supplies First procurement October 2007 Febuary 2009 Last procurement July 2009 June 2011 Completion of equipment installation Septembe 2011 December 2011 Start of Operations Completion of tests and commissioning December 2011 March 2012 Beginning of start-up December 2011 March 2012 5. Project Performance Report Ratings Ratings Development Implementation Implementation Period Objectives Progress From 15 to 31 December 2005 Satisfactory Satisfactory From 1 January 2005 to 31 May 2006 Satisfactory Satisfactory From 1 June 2006 to 1 January 2007 Satisfactory Unsatisfactorya From 1 February 2007 to 31 December 2007 Satisfactory Satisfactory From 1 January 2008 to 31 December 2008 Satisfactory Satisfactory From 1 January 2009 to 31 December 2009 Satisfactory Satisfactory From 1 January 2010 to 31 December 2010 Satisfactory Satisfactory From 1 January 2011 to 31 December 2011 Satisfactory Satisfactory From 1 January 2012 to 31 December 2012 Satisfactory Satisfactory a Four months delay in signing the loan agreement. D. Data on Asian Development Bank Missions No. of No. of Specialization Name of Mission Date Persons Person-Days of Members Fact-finding 20–26 Apr 2005 7 49 a, b, c, f Appraisal 15–20 Jun 2005 5 30 a, b, c, e Inception 12–15 Dec 2006 1 4 a Review 1 and hand overa 13–16 Nov 2007 4 16 a, f, g Review 2 28 Oct–3 Nov 2008 3 26 a, g, i Midterm review 14–23 Oct 2009 5 31 d, g, h, i , l Review 4 12–17 Apr 2010 4 24 g, i, j , l Review 5 7–14 Apr 2011 5 31 a, d, g, l, m Review 6 7–14 May 2012 2 16 a, g iv No. of No. of Specialization Name of Mission Date Persons Person-Days of Members Project completion reviewb 2–9 Sep 2013 6 39 a, d, g, i, j, k a The Hunan Roads Development III Project was transferred to the Asian Development Bank Resident Mission in the People’s Republic of China for administration on 27 December 2007.