Completion Report Project Number: 30081 Loan Number: 1691 February 2006 People’s Republic of China: Southern Yunnan Road Development Project CURRENCY EQUIVALENTS Currency Unit – yuan (CNY) At Appraisal At Project Completion (1 May 1999) (18 July 2005) CNY1.00 = $0.1208 $0.1233 $1.00 = CNY8.2790 CNY8.1080 ABBREVIATIONS ADB – Asian Development Bank EIA – environmental impact assessment EIRR – economic internal rate of return FIRR – financial internal rate of return GMS – Greater Mekong Subregion LAO PDR – Lao People’s Democratic Republic LIBOR – London interbank offered rate MTE – medium-truck equivalent O&M – operation and maintenance PCR – project completion review PRC – People’s Republic of China VOC – vehicle operating cost YMEC – Yunnan YuanMo Expressway Corporation YPCD – Yunnan Provincial Communications Department YPSD – Yunnan Public Security Department WEIGHTS AND MEASURES mu =1/15 of a hectare NOTES (i) The fiscal year (FY) of the Government ends on 31 December. (ii) In this report, "$" refers to US dollars. Vice President Operations Group 2 Director General H. S. Rao, East and Central Asia Department (ECRD) Director N. C. Rayner, Transport and Communications Division, ECRD Team Leader X. Yang, Financial Specialist, ECRD Team Members S. Ferguson, Senior Resettlement Specialist, ECRD S. Noda, Project Specialist (Roads), ECRD W. Zhu, Resettlement Specialist, ECRD CONTENTS Page BASIC DATA i MAPS v I. PROJECT DESCRIPTION 1 II. EVALUATION OF DESIGN AND IMPLEMENTATION 1 A. Relevance of Design and Formulation 1 B. Project Outputs 2 C. Project Costs 4 D. Disbursements 5 E. Project Schedule 5 F. Implementation Arrangements 5 G. Conditions and Covenants 5 H. Consultant Recruitment and Procurement 6 I. Performance of Consultants, Contractors, and Suppliers 7 J. Performance of the Borrower and the Executing Agency 7 K. Performance of the Asian Development Bank 7 III. EVALUATION OF PERFORMANCE 8 A. Relevance 8 B. Efficacy in Achievement of Purpose 8 C. Efficiency in Achievement of Outputs and Purpose 10 D. Preliminary Assessment of Sustainability 11 E. Environmental, Sociocultural, and Other Impacts 12 IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 14 A. Overall Assessment 14 B. Lessons Learned 15 C. Recommendations 15 APPENDIXES 1. Project Framework 16 2. Chronology of Major Events 21 3. Project Engineering Evaluation 23 4. Feeder Road Program in the Project Area 26 5. Project Costs and Financing 29 6. Projected and Actual Disbursements 30 7. Implementation Schedule 31 8. Organizational Chart of Yunnan YuanMo Expressway Corporation 32 9. Status of Compliance with Loan Covenants 33 10. Contract Packages at Appraisal and Actual Packages 38 11. Contract Details for Civil Works, Equipment, and Consultants 39 12. Traffic Analysis and Forecasts 43 13. Economic Evaluation 47 14. Financial Evaluation 50 15. Environmental Impact Analysis 55 16. Evaluation of Land Acquisition and Resettlement 57 17. Social and Poverty Impact Analysis 62 18. Evaluation of the Ethnic Minorities Development Plan 66 BASIC DATA A. Loan Identification 1. Country People’s Republic of China (PRC) 2. Loan Number 1691-PRC 3. Project Title Southern Yunnan Road Development Project 4. Borrower PRC 5. Executing Agency Ministry of Finance 6. Amount of Loan $250.0 million 7. Project Completion Report Number PCR: PRC 913 B. Loan Data 1. Appraisal – Date Started 1 March 1999 – Date Completed 11 March 1999 2. Loan Negotiations – Date Started 18 May 1999 – Date Completed 20 May 1999 3. Date of Board Approval 24 June 1999 4. Date of Loan Agreement 24 January 2000 5. Date of Loan Effectiveness – In Loan Agreement 24 April 2000 – Actual 18 May 2000 – Number of Extensions None 6. Closing Date – In Loan Agreement 31 March 2004 – Actual 5 January 2005 – Number of Extensions 2 7. Terms of Loan1 – Interest Rate Pool-based variable lending rate for US dollars – Maturity (number of years) 24 – Grace Period (number of years) 4 8. Terms of Relending (if any) – Interest Rate Pool-based variable lending rate for US dollars – Maturity (number of years) 24 – Grace Period (number of years) 4 – Second-Step Borrower Yunnan YuanMo Expressway Corporation 1 A total of $92,232,239.10 was transformed to LIBOR-based loan in November 2002. ii 9. Disbursements a. Dates Initial Disbursement Final Disbursement Time Interval 17 August 2000 5 January 2005 52 months Effective Date Original Closing Date Time Interval 18 May 2000 31 March 2004 46 months b. Amount ($) Category or Original Last Revised Amount Amount Undisbursed Subloan Allocation Allocation Available Disbursed Balance Civil Works 171,200,000 205,262,574 205,262,574 205,262,574 0 Equipment: Expressway 21,000,000 9,608,159 9,608,159 9,608,159 0 Equipment: Feeder Road 4,800,000 3,280,190 3,280,190 3,280,190 0 Consulting Services 2,000,000 1,453,524 1,453,524 1,453,524 0 Interest During Construction 36,000,000 30,395,553 30,395,553 30,395,553 0 Unallocated 15,000,000 0 0 0 0 Total 250,000,000 250,000,000 250,000,000 250,000,000 0 10. Local Costs (Financed) - Amount ($) 0 - Percent of Local Costs 0 - Percent of Total Cost 0 C. Project Data 1. Project Cost ($ million) Cost Appraisal Estimate Actual Foreign Exchange Cost 343.1 379.1 Local Currency Cost 427.2 606.4 Total 770.3 985.5 2. Financing Plan ($ million) Cost Appraisal Estimate Actual Implementation Costs ADB-Financed 214.0 219.7 Ministry of Communications 102.2 102.2 Ministry of Finance 3.0 3.0 Yunnan Provincial Government 238.9 414.5 China Development Bank 156.6 156.6 Subtotal 714.7 896.0 IDC Costs ADB-Financed 36.0 30.3 Yunnan Provincial Government 19.6 59.2 Other External Financing 0.0 0.0 Subtotal 55.6 89.5 Total 770.3 985.5 ADB = Asian Development Bank, IDC = interest during construction. iii 3. Cost Breakdown by Project Component ($ million) Appraisal Estimate Actual Foreign Local Total Foreign Local Total Component Exchange Currency Exchange Currency A. Base Cost Expressway Civil Works 245.5 325.4 570.9 318.6 422.4 741.0 Equipment 25.8 0.0 25.8 28.7 0.0 28.7 Land Acquisition and Resettlement 0.0 22.0 22.0 0.0 44.0 44.0 Consulting Services and Training 2.0 9.7 11.7 1.5 38.6 40.1 Feeder Roads 6.8 15.9 22.7 0.0 42.2 42.2 Subtotal (A) 280.1 373.0 653.1 348.8 547.2 896.0 B. Contingencies 27.0 34.6 61.6 0.0 0.0 0.0 C. IDC 36.0 19.6 55.6 30.3 59.2 89.5 Subtotal (B + C) 63.0 54.2 117.2 30.3 59.2 89.5 Total 343.1 427.2 770.3 379.1 606.4 985.5 IDC = interest during construction. 4. Project Schedule Item Appraisal Estimate Actual Date of Contract with Consultants August 1998 15 June 2000 Completion of Detailed Engineering Designs May 1999 24 January 2000 Civil Works Contract Date of Award October 1999 23 May 2000 Completion of Work (including local road) September 2003 31 December 2004 Equipment and Supplies Dates of First Procurement June 2000 26 September 2000 Last Procurement January 2002 24 June 2003 Completion of Equipment Installation April 2003 15 November 2003 Start of Expressway Operation 1 October 2003 28 October 2003 5. Project Performance Report Ratings Ratings Implementation Period Development Implementation Objectives Progress From 1 January 2002 to 31 March 2002 S S From 1 April 2002 to 30 June 2002 S S From 1 January 2003 to 30 June 2003 HS S From 1 July 2003 to 31 December 2003 HS S From 1 January 2004 to 30 June 2004 S S From 1 July 2004 to 30 September 2004 S S From 1 October 2004 to 31 December 2004 S S From 1 January 2005 to 30 September 2005 HS S S = successful, HS = highly successful. iv D. Data on Asian Development Bank Missions No. of No. of Specialization Name of Mission Date Persons Person-Days of Members Fact-Finding Mission 19 Oct–6 Nov 1998 6 70 a, b, c, f, g, h Appraisal Mission 1–11 Mar 1999 7 70 a, b, c, d, e, g, h Inception Mission 7–15 Dec 2000 2 16 a, i Loan Review 1 11–18 Dec 2001 1 7 a Midterm Review 10–18 Dec 2002 3 24 a, b, i Loan Review 2 20–25 Nov 2003 1 5 f Loan Review 3 17–21 Jan 2005 2 8 b, j Project Completion Reviewa 18–29 Jul 2005 4 27 a, b, i, j a - engineer, b - financial analyst, c - counsel, d - economist, e - procurement consultant or specialist, f - control officer, g - programs officer, h - environment specialist, i - assistant project analyst. a The project completion report was prepared by X. Yang, financial specialist/mission leader assisted by S. Noda, Project Specialist (Roads); S. Ferguson, Sr. Resettlement Specialist; W. Zhu, Project Officer (Resettlement); M. Tordecillas, Project Analyst; and a Transport Specialist (staff consultant). o 98 00'E 108 o 00'E 99o 00'E 104o 00'E SOUTHERN YUNNAN ROAD DEVELOPMENT PROJECT X I Z A N G TRUNK HIGHWAY NETWORK IN YUNNAN PROVINCE IN THE YUNNAN PROVINCE PEOPLE'S REPUBLIC OF CHINA 24o 00'N o OF THE PRC 24 00'N MYANMAR Daguan o o LAO PDR 28 00'N 28 00'N Gulf of Zhongdian S I C H U A N Tonkin 2 2 Zhaotong THAILAND Lijiang ADB-financed VIET NAM Yunnan Exressway Project Lanping CAMBODIA 2 ADB-financed Western Gulf of Yunnan Roads Development Project Huize 10 o 00'N Thailand 10 o 00'N G U I Z H O U South Dongchuan Daipu Andaman China Sea Sea Fuyuan Luquan 2 Xiangyun E o 98 o 00'E 108 00'E Dali E Qujing E KUNMING Bao Shan Lianghe E Yanglin Chuxiong E 2 E Anning 2 Lunan Longling Shizong 1 E R e Yuxi M YA N M A R Southern Yunnan Road d Mile Ruili R i Development Project v e r E Xunjiansi r Lin Cang e v i R Yuanjiang Jing Gu E G U A N G X I 1 Kaiyuan Funing g Jianshui Yanshan n E o 2 k e M Gejiu Pu'er E Mohei Simao JiIangcheng Road Class (current or after ongoing/planned upgrading): E Provincial Capital Xiaomengyang E Expressway o City/Town o 24 00'N V I E T N A M 1 Class I Highway 24 00'N National Road N Jinghong 2 Class II Highway E Provincial Road Railway Existing Expressway Mohan 0 50 100 150 River Completed Road Project Provincial Boundary Highway Being Upgraded 0 5 Kilometers - International Boundary Highway Open to Traffic M 2 LAO PEOPLE'S 9 2 DEMOCRATIC REPUBLIC a 3 Boundaries are not necessarily authoritative.