Completion Report Project Number: 33062 Loan Number: 1798-INO August 2008 Indonesia: Road Rehabilitation (Sector) Project CURRENCY EQUIVALENTS Currency Unit – rupiah (Rp) At Appraisal At Project Completion 2 October 2000 31 July 2007 Rp1.00 = $0.000114 $0.000109 $1.00 = Rp8,770 Rp9,167 ABBREVIATIONS AADT – average annual daily traffic ADB – Asian Development Bank BAPPENAS – Badan Perencanaan Pembangunan Nasional (National Development Planning Agency) DGH – Directorate General for Highways DGLT – Directorate General for Land Transportation DGRID – Directorate General for Regional Infrastructure Development EA – executing agency EIRR – economic internal rate of return EMMP – environmental mitigation management plan ERM – Economic Review Module IA – implementing agency ICB – international competitive bidding IRI – international roughness index IRMS – Integrated Road Management System LARP – land acquisition and resettlement plans MOT – Ministry of Transportation MSRI – Ministry of Settlements and Regional Infrastructure PMU – project management unit SEMEP – Socioeconomic Monitoring and Evaluation Program TA – technical assistance NOTE In this report, “$” refers to US dollars. Vice President C. Lawrence Greenwood, Jr., Operations Group 2 Director General A. Thapan, Southeast Asia Department (SERD) Country Director J. A. Nugent, Indonesia Resident Mission, SERD Team leader R. Kausar, Infrastructure Specialist, SERD Team member H.S. Soewartono, Senior Project Implementation Officer, SERD CONTENTS Page BASIC DATA ii MAP v I. PROJECT DESCRIPTION 1 II. EVALUATION OF DESIGN AND IMPLEMENTATION 2 A. Relevance of Design and Formulation 2 B. Project Outputs 3 C. Project Costs 5 D. Disbursements 6 E. Project Schedule 6 F. Implementation Arrangements 7 G. Conditions and Covenants 8 H. Consultant Recruitment and Procurement 8 I. Performance of Consultants, Contractors, and Suppliers 9 J. Performance of the Borrower and the Executing Agency 9 K. Performance of the Asian Development Bank 10 III. EVALUATION OF PERFORMANCE 10 A. Relevance 10 B. Effectiveness in Achieving Outcome 10 C. Efficiency in Achieving Outcome and Outputs 11 D. Preliminary Assessment of Sustainability 11 E. Impact 12 IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 13 A. Overall Assessment 13 B. Lessons 13 C. Recommendations 14 APPENDIXES 1. Project Framework 2. Project Outputs – Road and Bridge Component 3. Outputs under Road Sector Policies Component 4. Project Cost 5. Utilization of Loan Proceeds 6. Project Implementation Schedule 7. Project Organization 8. List of Loan Covenants 9. Economic Justification and Reevaluation ii BASIC DATA A. Loan Identification 1. Country Indonesia 2. Loan Number 1798 3. Project Title Road Rehabilitation (Sector) Project 4. Borrower Republic of Indonesia 5. Executing Agency Directorate General for Highways 6. Amount of Loan $190,000,000 7. Project Completion Report Number PCR: INO 1050 B. Loan Data 1. Appraisal – Date Started 12 June 2000 – Date Completed 22 June 2000 2. Loan Negotiations – Date Started 26 October 2000 – Date Completed 27 October 2000 3. Date of Board Approval 11 December 2000 4. Date of Loan Agreement 27 March 2001 5. Date of Loan Effectiveness – In Loan Agreement 28 June 2001 – Actual 28 September 2001 – Number of Extensions 1 6. Closing Date – In Loan Agreement 31 March 2005 – Actual 31 July 2007 – Number of Extensions 2 7. Terms of Loan – Interest Rate Variable – Maturity (number of years) 24 years – Grace Period (number of years) 4 years 8. Disbursements a. Dates Initial Disbursement Final Disbursement Time Interval 15 November 2001 21 December 2007 74 months Effective Date Original Closing Date Time Interval 28 September 2001 31 March 2005 43 months iii b. Amount ($million) Category Original Last Amount Net Amount Undisbursed Allocation Revised Canceled Amount Disbursed Balance Allocation Available 01A Civil Works, Roads and Bridges 138.50 137.61 4.31 137.61 133.30 4.31 01B Civil Works, Road Sector Policies 2.70 2.04 0.00 2.04 2.04 0.00 02 Equipment 1.80 0.72 0.03 0.72 0.69 0.03 03A Consultants, Core Team 7.50 8.34 0.07 8.34 8.27 0.07 03B Consultants, Field Teams 10.70 13.85 0.27 13.85 13.58 0.27 03C Consultants, Road Sector Policies 1.80 3.39 0.25 3.39 3.14 0.25 03D Capacity Building 1.80 1.77 0.09 1.77 1.68 0.09 4 Front-end Fee 1.90 1.90 0.00 1.90 1.90 0.00 5 IDC 23.30 16.63 0.52 16.63 16.11 0.52 Total 190.00 186.25 5.54 186.25 180.72 5.54 IDC = interest during construction. 9. Local Costs (Financed) - Amount ($million) 82.20 - Percent of Local Costs 50.00 - Percent of Total Cost 31.00 C. Project Data 1. Project Cost ($ million) Cost Appraisal Estimate Actual Foreign Exchange Cost 110.00 98.51 Local Currency Cost 140.00 162.53 Total 250.00 261.04 2. Financing Plan ($ million) Cost Appraisal Estimate Actual Implementation Costs Borrower Financed 60.00 80.32 ADB Financed 164.80 162.71 Other External Financing 0.00 0.00 Total 224.80 243.03 IDC Costs Borrower Financed 0.00 0.00 ADB Financed 25.20 18.01 Other External Financing 0.00 0.00 Total 25.20 18.01 ADB = Asian Development Bank, IDC = interest during construction. iv 3. Cost Breakdown by Project Component ($million) Component Appraisal Estimate Actual Part A: Road and Bridge Works - Civil Works 195.80 209.47 - Core Team Consultants 8.20 10.11 - Field Team Consultants 11.80 15.09 Part B: Road Sector Policies - Consulting Services 2.00 3.45 - Equipment 2.00 0.77 - Minor Civil Works 3.00 2.27 Part C: Capacity Building in Road and Bridge Works - Consulting Services and Training 2.00 1.87 Total 224.80 243.03 4. Project Schedule Item Appraisal Estimate Actual Part A: Road and Bridge Works Date of Contract with Consultants 31 April 2001 22 November 2002 Completion of Engineering Designs for Batch 1 30 November 2000 15 October 2002 Civil Works Contract (Batch 1) Date of Award 30 May 2001 13 December 2002 Completion of Work 30 July 2002 17 July 2004 Civil Works Contract (Batch 2) Date of Award 1 March 2002 15 June 2004 Completion of Work 30 March 2004 6 January 2007 Civil Works Contract (Batch 3) Date of Award 1 March 2003 15 November 2005 Completion of Work 30 September 2004 25 July 2007 Part B: Road Sector Policies Date of Contract with Consultants May 2001 1 March 2004 Civil Works and Supplies Date of First Procurement 14 December 2005 Date of Last Procurement 21 June 2006 Date of Completion of Weighbridge Installation 31 August 2007 Completion of Tests and Commissioning 15 October 2007 Beginning of Start-Up 15 December 2007 Part C: Capacity Building in Road and Bridge Works Date of Contract with Consultants May 2001 21 December 2005 v 5. Project Performance Report Ratings Ratings Development Implementation Implementation Period Objectives Progress From 1 January to 31 December 2001 Satisfactory Satisfactory From 1 January to 31 December 2002 Satisfactory Satisfactory From 1 January to 31 December 2003 Satisfactory Satisfactory From 1 January to 31 December 2004 Satisfactory Satisfactory From 1 January to 31 December 2005 Satisfactory Satisfactory From 1 January to 31 December 2006 Satisfactory Satisfactory From 1 January to 21 December 2007 Satisfactory Satisfactory D. Data on Asian Development Bank Missions No. of No. of Specialization Name of Mission Date Persons Person-Days of Membersa Appraisal Mission 12 to 22 June 2000 6 60 a, a, b, h, d, c Inception Mission 22 to 30 Nov 2001 1 9 a Loan Review Mission 28 Jan to 2 Feb 2002 1 4 a Loan Review Mission 9 to 14 March 2002 1 6 a Loan Review Mission 14 to 22 August 2002 1 8 a Loan Review Mission 30 Nov to 4 Dec 2002 1 4 a Loan Review Mission 28 Jan to 7 Feb 2003 1 11 a Loan Review Mission 23 to 29 May 2003 1 6 a Loan Review Mission 11 to 21 May 2004 3 19 a, a, i Special Project Administration 9 to 10 Feb 2005 2 10 a, a Mission Loan Review Mission 4 to 12 July 2005 3 12 a, a, i,f Loan Review Mission 10 to 12 August 2005 3 12 a, a, i Midterm Review Mission 21 Nov to 5 Dec 2005 5 22 a, a, a, h, g Special Project Administration 30 May to 1 June 2006 2 6 a, a Mission Loan Review Mission 20 Nov to 21 Dec 2006 2 14 a, a Special Project Administration 9 to 18 April 2007 1 8 a Mission Project Completion Review 10 to 19 March 2008 3 21 a, a, e a a - engineer, b – program officer, c - counsel, d - economist, e - consultant, f - control officer, g - social development specialist, h - poverty reduction specialist, i - procurement officer.-. vi Project Map I. PROJECT DESCRIPTION 1. On 11 December 2000, the Asian Development Bank (ADB) approved a loan of $190 million to the Government of Indonesia to finance 76% of the total project cost of $250 million for the Road Rehabilitation (Sector) Project1 from the ordinary capital resources fund. The aim of the Project was to support the Government’s road sector programs by (i) funding a time slice of civil works on priority roads; (ii) helping the Government in implementing its road sector policies, and particularly those related to road user charges, vehicle overloading, and road safety; and (iii) assisting with institutional capacity building in road and bridge works. 2. The Project covered three major components, with civil works representing about 80% of the total cost that included periodic maintenance on about 2,500 kilometers (km) of roads, road betterment on about 500 km, and some 3,000 linear meters of bridge rehabilitation or replacement in 15 provinces2 in Java, Kalimantan, Sulawesi, and Sumatra.