for official use only - world bank...for official use only report no: pad876 international...
TRANSCRIPT
Document of The World Bank
FOR OFFICIAL USE ONLY
Report No: PAD876
INTERNATIONAL DEVELOPMENT ASSOCIATION
PROJECT APPRAISAL DOCUMENT
ON A
PROPOSED CREDIT
IN THE AMOUNT OF SDR45.9 MILLION (US$71 MILLION EQUIVALENT)
TO THE
REPUBLIC OF CAMEROON
FOR A
MULTIMODAL TRANSPORT PROJECT
May 1, 2014
Transport Sector Country Department, AFCC1 Africa Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
CURRENCY EQUIVALENTS
(Exchange Rate Effective February 28, 2014)
Currency Unit = C.F.A Francs BEAC (XAF)
XAF477.5 = US$1 US$1.543 = SDR 0.64624531
SDR 1 = US$ 1.54740001
FISCAL YEAR January 1 – December 31
ABBREVIATIONS AND ACRONYMS
AfDB African Development Bank CAMRAIL Cameroon Railway BM-BAD World Bank-African Development Bank (Banque Mondiale –Banque
Africaine de Développement) CAR Central African Republic CAS Country Assistance Strategy CSPM Special Tender Board (Commission Spéciale de Passation des Marchés Publics) CEMAC Economic and Monetary Community of Central Africa (Communauté Economique
et Monétaire d’Afrique Centrale) CQS Consultants’ Qualifications DA Designated Account DG Development Grant EA Environmental Assessments ECCAS Economic Community of Central Africa States EIRR Economic Internal Rate of Return EMP Environmental Management Plan ESIA Environmental and Social Impact Assessment ESMP Environmental and Social Mitigation and Management Measures EU European Union FCFA African Financial Community Franc (Franc des Colonies Françaises d'Afrique) FM Financial Management GDP Gross Domestic Product GoC Government of Cameroon GPN General Procurement Notice HDM Highway Development and Management Model IBRD International Bank for Reconstruction and Development ICB International Competitive Bidding IDA International Development Association
IRI International Roughness Index ISP Implementation Support Plan LOS Level Of Service
MINEPAT Ministry of Economy, Planning and Regional Development (Ministère de l'Economie, de la Planification et de l'Aménagement du Territoire)
MINMAP Ministry of Public Procurement (Ministère des Marchés Publics) MINTP Ministry of Public Works (Ministère des Travaux Publics) NCB National Competitive Bidding NPV Net Present Value OP/BP Operations Policy/Bank Procedure OPEC Organization of Petroleum Exporting Countries ORAF Operational Risk Assessment Framework PAP Project Affected People PBC Performance-Based Contract PDO Project Development Objective PIU Project Implementation Unit PPP Public Private Partnership PREM Poverty Reduction and Economic Management QCBS Quality-and Cost-Based Selection RAP Resettlement Action Plan RFM Road Maintenance Fund RUC Road User Costs SDR Special Drawing Rights SFB Selection under a Fixed Budget SSS Sole Source Selection TEU Twenty-foot Equivalent Unit TTF Trade and Transport Facilitation TTL Task Team Lead TOR Terms Of Reference TTFP Trade and Transport Facilitation Project UN United Nations UNDB United Nations Development Business VOC Vehicle Operating Costs XAF Central African Franc WB World Bank
Regional Vice President: Makhtar Diop Country Director: Gregor Binkert
Sector Director: Jamal Saghir Sector Manager: Supee Teravaninthorn
Task Team Leader / Co-Task Team Leader: Peter Ngwa Taniform / Pierre Graftieaux
REPUBLIC OF CAMEROON CAMEROON MULTIMODAL TRANSPORT 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 .......................................... 6
II. PROJECT DEVELOPMENT OBJECTIVES ................................................................7
A. PDO............................................................................................................................... 7
Project Beneficiaries ........................................................................................................... 7
PDO Level Results Indicators ............................................................................................. 8
III. PROJECT DESCRIPTION ..............................................................................................9
A. Project Components ...................................................................................................... 9
B. Project Financing ........................................................................................................ 11
Project Cost and Financing ............................................................................................... 11
C. Lessons Learned and Reflected in the Project Design ................................................ 11
IV. IMPLEMENTATION .....................................................................................................12
A. Institutional and Implementation Arrangements ........................................................ 12
B. Results Monitoring and Evaluation ............................................................................ 13
C. Sustainability............................................................................................................... 14
V. KEY RISKS AND MITIGATION MEASURES ..........................................................14
A. Risk Ratings Summary Table ..................................................................................... 14
B. Overall Risk Rating Explanation ................................................................................ 14
VI. APPRAISAL SUMMARY ..............................................................................................15
A. Economic and Financial Analysis ............................................................................... 15
B. Technical ..................................................................................................................... 16
C. Financial Management ................................................................................................ 17
D. Procurement ................................................................................................................ 18
E. Environment and Social (including Safeguards) ........................................................ 19
F. Other Safeguards Policies Triggered .......................................................................... 20
Annex 1: Results Framework and Monitoring .........................................................................21
Annex 2: Detailed Project Description .......................................................................................27
Annex 3: Implementation Arrangements ..................................................................................34
Annex 4: Operational Risk Assessment Framework (ORAF) .................................................53
Annex 5: Implementation Support Plan ....................................................................................57
Annex 6: Appraisal Summary- Economic analysis ..................................................................60
Annex 7: Environmental and Social Safeguards ......................................................................64
i
PAD DATA SHEET
Republic of Cameroon
Cameroon Multimodal Transport Project (P143801)
PROJECT APPRAISAL DOCUMENT
.
AFRICA
AFTTR
Report No.: PAD876
Basic Information
Project ID EA Category Team Leader
P143801 B - Partial Assessment Peter Ngwa Taniform / Pierre Graftieaux
Lending Instrument Fragile and/or Capacity Constraints [ ]
Investment Project Financing Financial Intermediaries [ ]
Series of Projects [ ]
Project Implementation Start Date Project Implementation End Date
27-May-2014 31-Dec-2020
Expected Effectiveness Date Expected Closing Date
31-August-2014 30-June-2021
Joint IFC
No
Sector Manager Sector Director Country Director Regional Vice President
Supee Teravaninthorn Jamal Saghir Gregor Binkert Makhtar Diop
Borrower: Republic of Cameroon
Responsible Agency: Cellule BAD/WB
Contact: ZANGA Mathurin Title: Coordinator
Telephone No.: 237-2222-2294 Email: [email protected], [email protected]
Project Financing Data(in USD Million)
[ ] Loan [ ] Grant [ ] Guarantee
[ X ] Credit [ ] IDA Grant [ ] Other
ii
Total Project Cost: 91.00 Total Bank Financing: 71.00
Financing Source Amount
BORROWER/RECIPIENT 20.00
International Development Association (IDA) 42.32
IDA recommitted as a credit Total
28.6891.00
Expected Disbursements (in USD Million)
Fiscal Year 2015 2016 2017 2018 2019 2020 2021
Annual 15.00 25.00 14.00 9.00 5.00 2.00 1.00
Cumulative 15.00 40.00 54.00 63.00 68.00 70.00 71.00
Proposed Development Objective(s)
The Project Development Objective is to increase multimodal transport efficiency and effectiveness along the Yaoundé–Kousseri Corridor.
Components
Component Name Cost (USD Millions)
Roads Infrastructure Improvement 57.00
Rail Infrastructure Improvement 9.00
Infrastructure Sector Institutional Strengthening; Project Management
5.00
Institutional Data
Sector Board
Transport
Sectors / Climate Change
Sector (Maximum 5 and total % must equal 100)
Major Sector Sector % Adaptation Co-benefits %
Mitigation Co-benefits %
Transportation Rural and Inter-Urban Roads and Highways
88
Transportation Railways 9
Transportation General Transportation 3
iii
Sector
Total 100
I certify that there is no Adaptation and Mitigation Climate Change Co-benefits information applicable
to this project.
Themes
Theme (Maximum 5 and total % must equal 100)
Major theme Theme %
Trade and integration Trade facilitation and market access 20
Trade and integration Regional integration 80
Total 100
Compliance
Policy
Does the project depart from the CAS in content or in other significant respects?
Yes [ ] No [X]
Does the project require any waivers of Bank policies? Yes [ ] No [X]
Have these been approved by Bank management? Yes [ ] No [ ]
Is approval for any policy waiver sought from the Board? Yes [ ] No [X]
Does the project meet the Regional criteria for readiness for implementation? Yes [X] No [ ]
Safeguard Policies Triggered by the Project Yes No
Environmental Assessment OP/BP 4.01 X
Natural Habitats OP/BP 4.04 X
Forests OP/BP 4.36 X
Pest Management OP 4.09 X
Physical Cultural Resources OP/BP 4.11 X
Indigenous Peoples OP/BP 4.10 X
Involuntary Resettlement OP/BP 4.12 X
Safety of Dams OP/BP 4.37 X
Projects on International Waterways OP/BP 7.50 X
Projects in Disputed Areas OP/BP 7.60 X
Effectiveness Conditions
iv
Name Type
Subsidiary Agreement Effectiveness
The Subsidiary Agreement has been executed on behalf of the Recipient and the Project Implementing Entity. FA Article 4.01 (a)
Name Type
Project Implementing Entity Effectiveness
The Recipient has expanded the mandate of the Project Steering Committee to encompass the proposed project. FA Article 4.01 (c)
Name Type
Project Implementation Manual Effectiveness
The Recipient and the Project Implementing Entity have adopted the Project Implementation Manual in accordance with the provision of the Financing Agreement. FA Article 4.01 (b)
Disbursement Condition for part A
Name
The Borrower will deposit into the Counterpart Funds Account, an amount equivalent to six million Dollars ($6,000,000) for the rehabilitation of Maroua-Mora. FA, Schedule 2, Section V.A.2.(a)(i)
Legal Covenants
Name Recurrent Due Date Frequency
The Borrower will allocate, through the RMF, on a schedule and in installments agreed with the Association as reflected in the Annual Work Plan and Budget, a total amount equivalent to nine million Dollars ($9,000,000) for the maintenance of Maroua-Kousseri. FA Schedule 2. Section V.A. 2 (b)
Yes Yearly
Name Recurrent Due Date Frequency
The Borrower will recruit a road engineer and a monitoring and evaluation specialist. FA Schedule 2. Section I. A. 2 (b) (i)
No Not later than three (3) months
after the Effective Date
N/A
Name Recurrent Due Date Frequency
The Borrower will adapt the computerized multi-project financial and accounting system within the Project Implementation Unit.
No Not later than two (2) months after
the Effective Date
N/A
v
FA Schedule 2. Section II.B. 4
Name Recurrent Due Date Frequency
The Borrower will recruit a technical auditor with qualifications, experience and terms of reference acceptable to the Association. FA Schedule 2. Section V.C
No Not later than six (6) months after
the Effective Date
N/A
Name Recurrent Due Date Frequency
The Borrower will deposit into the Counterpart Funds Account, an amount equivalent to five million Dollars ($5,000,000) for the rehabilitation of Maroua-Mora. FA Schedule 2. Section V.A. 2 (a) (ii)
No April 30, 2016 N/A
Name Recurrent Due Date Frequency
The Borrower will recruit an external financial auditor. FA Schedule 2. Section II. 2 B (5)
No Not later than six (6) months after
the Effective Date
N/A
Team Composition
Bank Staff
Name Title Specialization Unit
Felly Akiiki Kaboyo Operations Analyst Operations AFTTR
Lucienne M. M'Baipor Senior Social Development Specialist
Social Aspects AFTCS
Pierre Graftieaux Lead Transport Specialist
Co-TTL AFTTR
Emeran Serge Menang Evouna
Senior Environmental Specialist
Environmental Aspects AFTN1
Aissatou Diallo Senior Finance Officer Senior Finance Officer CTRLA
Kouami Hounsinou Messan
Senior Procurement Specialist
Procurement AFTPW
Jean Kanyamuhanda Consultant Trade Facilitation AFTTR
Enagnon Ernest Eric Adda
Financial Management Specialist
Financial Management AFTMW
Peter Ngwa Taniform Sr Transport Spec. TTL AFTTR
Nneoma Nwogu Counsel Legal Aspects LEGAM
Marc Navelet Senior Transport Spec. Highway Engineering AFTTR
Fabio Galli Lead Transport Spec. Program Team Leader AFTTR
Lydie Anne Billey E T Temporary Assistance AFTTR
Laure Deffa Barry E T Temporary Assistance AFTTR
vi
Leonard E. N. Wolloh E T Temporary Assistance AFCC1
Non-Bank Staff
Name Title Office Phone City
Eric Landureau Road Engineer (33) 1 41 78 73 13 Creteil, France
Locations
Country First Administrative Division
Location Planned Actual Comments
1
I. STRATEGIC CONTEXT
A. Country Context
1. Cameroon is a medium sized (475,000 square km) country with a population of about 21.7 million growing at around 2.2 percent per annum, located in Central Africa, neighboring Nigeria, Chad, the Central African Republic, the Republic of Congo, Gabon, and Equatorial Guinea. It is a low middle income country with high levels of poverty and weak social indicators, giving it a Human Development Index country ranking of 150. Gross Domestic Product (GDP) per capita (PPP) stood at United States Dollars (US$) 2,330 in 2013. Economic growth has been modest over the past decade (3.3 percent average growth per annum between 2003 and 2007), and the economy was also negatively affected by the global crisis of 2009, which led to weaker demand for Cameroon’s non-oil exports. Since 2010, however, economic growth has increased, with GDP growth rates reaching 4.2 percent in 2011, 4.6 percent in 2012 and an estimated 4.8 percent in 2013. Forecasts for 2014 are around five percent. 2. After declining in value in 2009, due to the drop in commodity prices and volumes, Cameroon’s exports rebounded in 2010, while oil production also expanded. Given these trends, the Government of Cameroon’s 2012 (GoC) fiscal strategy was guided by a re-prioritization of public expenditure away from current spending, where Cameroon substantially increased its investment budget in view of scaling-up capital spending in priority areas such as energy, transport, telecommunications and agricultural sectors. Nevertheless, economic growth in Cameroon remains below potential, and below rates needed to sustainably develop the country and reduce poverty. This is largely due to poor infrastructure, an unfavorable business environment, and weak governance. 3. Poverty rates declined between 1996 and 2001 by some 13 percentage points, but have since stagnated at around 40 percent of the population.1 Chronic poverty stands at about 26 percent, which is high compared to other countries in the region with similar economic characteristics. There are wide regional disparities in poverty and levels/depth of poverty in Cameroon. The poor, in terms of numbers and level of poverty, are concentrated in the three northernmost provinces, the Far North, North, Adamawa, and in the East. These provinces are also where the majority of the chronic poor are found and where, in fact, poverty increased during the 2001 – 2007 period. Poverty is primarily a rural phenomenon, with about 87 percent of the poor living in rural areas. There are – in addition to regional disparities – also widespread differences in poverty within many regions. From 2001 to 2007, urban poverty decreased by 5.7 percent, while rural poverty increased by 2.9 percent. Social sectors paint the same picture for poverty: widespread regional disparities in terms of human development indicators and access and quality of services, with the North (Far North, North, and Adamawa) and the East lagging significantly behind the other provinces; a significant rural/urban divide; and a decline in some human development indicators. Cameroon is not likely to reach the Millennium Development Goals, except possibly the ones linked to access to primary education and water. 4. Cameroon’s development priorities are laid out in two main official documents, the 2009 ‘Growth and Employment Strategy’ (DSCE) and ‘Vision 2035’. The ‘Vision 2035’ sees
1 The most recent poverty data are from 2007.
2
Cameroon becoming a middle income, industrialized country with poverty levels at less than 10 percent. The DSCE identifies inadequate infrastructure and an unfavorable business environment as the main factors impeding economic growth and employment creation in Cameroon. The strategy emphasizes need for agricultural diversification, increased productivity, and large-scale public investment projects. The priority areas identified in the strategy are:
a) Infrastructure development in energy, telecoms, and transport; b) Development of the rural and mining sectors; c) Improvement in human resources through health, education, and training; d) Greater regional integration and export diversification; and e) Financial sector deepening and strengthening.
B. Sectoral and Institutional Context
5. Cameroon plays an important regional role in the context of transport and transit, connecting Chad and the Central African Republic—Cameroon’s two land-locked neighboring countries—to the Port of Douala, the Douala – Ngaoundere railway line, and the Douala – N’Djamena and Douala – Bangui transport corridors. Internally in Cameroon, the rail and road networks are key to transporting goods and people across all regions of the country. 6. The Economic and Monetary Community of Central Africa (Communauté Economique et Monétaire d’Afrique Centrale, CEMAC) region suffers from major transit bottlenecks—a result of poor physical infrastructure but also non-physical barriers and transit logistics inefficiencies. Previous trade and transportation work undertaken by the World Bank and other donors have identified soft bottlenecks to transit as the most urgent trade facilitation issue in the region. Some of these issues, including efficiencies at the level of the port and customs, are currently being addressed through a regional IDA-financed CEMAC Transport/Transit Facilitation Project and supplementing Trade Facilitation Facility funded Technical Assistance. 7. In order to improve transit efficiencies and reduce transport costs, CEMAC member countries adopted legislation regarding the community’s transit system and the single bond mechanism in October 2010. It will be first applied to the Douala - N'Djamena / Bangui corridors and will then be expanded to other corridors in the sub-region. The Cameroonian custom has a key role to play in this coordination process - to ensure regional interconnection of the customs systems and to consult with the CEMAC Commission.
8. Despite these constraints, trade exchanges between Cameroon, Chad and Central African Republic (CAR) are slowly increasing: between 2005 and 2008, the annual flows of freight increased from 1.31 to 1.43 million tons (+10 percent)2. About 79 percent of all of Chad’s imports pass through the Port of Douala. The bulk of trade flows are from Cameroon towards Chad (460,940 tons in 2010, of which 150,190 tons for construction materials and 119,829 tons for food and other consumable products), while flows from Chad to Cameroon (30,332 tons in 2010) mostly involve cotton exports (26,419 tons)3.
2 Study on the establishment of a transit regime in CEMAC zone. Etude sur la mise en place d’un régime de transit et d’un mécanisme de cautionnement communautaire en zone CEMAC. Essomba Nguele, S., 2009. 3 Rapport sur l’état du secteur portuaire national du Cameroun- année 2010.
3
9. Trade Facilitation. Operational and transactional dwell times at the Port of Doula4 (where in 2013 freight traffic reached about 10.3 million tons, i.e. a 7.9 percent increase compared to 2012 and 340,000 twenty-foot equivalent unit (TEU) were handled) have been reduced to 6.3 days, exceeding the 2010 Country Assistance Strategy (CAS) objective of 8.8 days. However, efforts are needed to reduce the current total dwell time5 of 15.6 days. Non-infrastructure bottlenecks are gradually being addressed, in part through the ongoing World Bank Economic and Monetary Community of Central Africa Trade and Transport Facilitation Project (CEMAC TTFP) that will close in 2016. These persisting issues include the need to reform policies on bonds for shipped goods, lengthy transit procedures, lack of competition and transparency in the trucking industry, and excessive number of check-points. 10. Road subsector. The Cameroonian road network is the second largest in the Economic Community of Central Africa States6 (ECCAS) with about 28,700 km of classified roads, out of which 19.3 percent is paved against an average of 15 percent in the ECCAS. However, road density in Cameroon is estimated at 9 km/1000 km2 and 0,280 km/1000 inhabitants, significantly below countries such as Côte d’Ivoire (16; 0.384) and Ghana (25; 0.354). It is estimated that by the end of 2015, up to 90 percent of the 1,842 km-long Douala–N’Djamena intra/inter regional road transport corridor will be in good to fair condition, compared to a baseline of 40 percent in 2007. This has already started to improve the connectivity and integration of the Northern regions of the country to the more economically dynamic parts of the country in the South, and created easier access to the port of Douala. It also helps reduce the high transport costs and transit logistics inefficiencies that have been identified as one of the main barriers to trade along the Douala - N’Djamena Corridor. 11. Following years of neglect and a severe reduction in the budget allocated to the sector, funding dedicated to road rehabilitation and maintenance has substantially increased over the last 10 years, partly as a result of the GoC complying with development partners’ conditions regarding the Road Fund. The National Road Maintenance Fund (RMF), which now has the potential to mobilize an annual budget of up to Central African Franc (XAF) 100 billion (about US$213 million equivalent), is only allocated XAF55 billion (about US$117 million equivalent) due to its poor planning and weak capacity to execute the actual amount. A recent European Union (EU) financed audit7 of maintenance contracts financed by the RMF, found that the technical quality of only about 45 percent of the civil works executed were of good or fair quality. 48 percent of the paved road network and 85 percent of the total unpaved road network is in poor condition. To address these issues, the Ministry of Public Works (Ministère des Travaux Publics- MINTP) has engaged in a policy dialogue with all donors active in the road sector on how best to optimize the use of Road Fund resources and pilot performance-based maintenance contracts have been proposed, so that larger-scale, more effective maintenance
4 Cameroon is also building a deep seaport in Kribi, in the South Region. The construction started in December 2010 and the port (phase 1 – US$450 million) is expected to be ready in late 2014. 5 The total dwell time is composed of the operational dwell time (time need for physical operations), the transactional dwell time (time for customs/ External Trade Single Window (Guichet Unique du Commerce Extérieur, GUCE) clearance) and the storage dwell time (time spent by importers to mobilize customs taxes and port fees, time during which transporters/importers use port facilities for storage purposes, etc…). 6 Cameroon, the Central African Republic, Chad, the Republic of Congo, Equatorial Guinea, and Gabon. 7 Source: Overview of Maier audits on firms and supervision firms. Récapitulatif des appréciations Maier sur les entreprises et les missions de contrôle; EU, Janvier 2011.
4
contracts can be carried out to ensure efficiency and sustainability of the current investments. Furthermore, the GoC plans to soon increase the RMF allocation to XAF70 billion (about US$145 million). 12. In its "Growth and Employment Strategy Paper" the Government projects that 95 percent of its classified road network should be in good condition by 2020 (100 percent by 2025). To reach this target, much needs to be done in terms of proper planning, increased resources dedicated to the sector, as well as putting in place efficient road asset management practices.
13. Cameroon is often cited as a good example in SSA for the way the country has enforced axle load control, which is critical for the sustainability of road investments and the success of performance-based maintenance contracts. The percentage of overloaded trucks has steadily decreased from 85 percent in 1998 to 9.5 percent in 2012 (13 percent in 2011). The network of weighing stations is still being extended (17 are currently operational, all managed and maintained by the private sector) and the number of trucks actually controlled annually increased from 606 thousand in 2010 to 1,178 thousand in 2011 and 1,544 thousands in 2012. Ninety nine percent of the overloads are below 5 tons.
14. Road safety on major transport corridors is another important policy issue. A 2008 European Union (EU)-financed study8 shows that between 2004 and 2007, the accident rate on the Douala–Yaoundé road was 35 times higher than on a similar road in Europe. While human behavior is responsible for three quarters of the accidents, some infrastructure “black spots” were also identified. Car crashes do not only cost lives and injuries, they also have an economic cost that contributes to the high transport and transit costs along the Douala-N’Djamena corridor. It has been estimated that the direct and indirect costs of poor safety conditions in developing countries such as Cameroon typically amount to about 1.5 percent of GDP. The existing CEMAC Trade and Transport Facilitation (TTF) Project is already including a road safety component that will carry out a diagnosis of road safety along the Douala-Kousseri corridor, and propose treatment of accidents black spots (e.g. by signage, speed restrictions, improving sightlines, etc.). US$2.5 million have been set aside under the CEMAC TTF Project for these investments, It is also worth mentioning that four railroad crossings (two in Douala, two in Yaounde), used by up to 40,000 motorized vehicles and 8 to 15 trains per day, have recently made headlines for sometimes deadly collisions between vehicles and trains. 15. On the key regional Douala – N’Djamena/Bangui transport corridors covered by the proposed project, major investments by the GoC and its development partners have already resulted in significant improvements in road conditions and trade facilitation. Part of the investments have been funded under the CEMAC TTFP. However, high transport costs and transit logistics inefficiencies remain challenges to trade in the CEMAC sub-region. While progress has recently been observed as a result of both the on-going road improvement works and trade facilitation activities financed by IDA and others, more effort is needed to reach target objectives.
8 Source: Road safety assessment and definition of priority intervention area on the Yaounde – Douala road (etude diagnostique pour décrire l’accidentalité et définir les priorités d’intervention sur l’axe Yaounde – Douala).
5
16. About 67 percent of the Yaoundé-Kousseri corridor is in good to fair condition. On the rehabilitated sections, travel time has been more than halved and a significant increase in traffic and economic development has been observed since end of 2012. Similarly between 2007 and 2013, the transit time for the Douala-N’Djamena corridor has decreased from 15 days to about 7 days. The customs bond release time has also been significantly reduced, from 63 days in 2007 to 12 days in 2013. 17. Railway subsector. In the railway subsector, Cameroon Rail (CAMRAIL, the concessionaire) plays an important role in serving northern Cameroon, Chad and Central African Republic (CAR). The CAMRAIL concession is performing well and the initially obsolete rolling stock and deteriorated rail track infrastructure is gradually being renewed. Since 1999 when the concession was signed, passenger traffic has grown by 70 percent (1.45 million passengers in 2012) and freight traffic by 50 percent (1.62 million tons in 2012). To ensure that the railway network remains competitive in the movement of freight and passengers and to ensure the long term sustainability of the concession, CAMRAIL and the GoC through the second amendment to the concession agreement signed in 2008, have agreed to invest respectively US$272 million and US$207 million between 2009 and 2020 for a total of US$479 million. Since then, CAMRAIL has already invested about US$106 million (US$56 million for the rolling stock, US$42 million for the infrastructure, US$8 million for spare parts) and the GoC US$97 million (US$28 million for the rolling stock, US$69 million for the infrastructure). 18. The annual turnover of CAMRAIL reached US$120 million in 2012 and operating profit US$13.4 million. Through the 2nd amendment to the concession agreement, the fixed concession fee paid by CAMRAIL to the conceding authority was increased from US$3 to US$4 million, to which is added a variable fee amounting to 50 percent of CAMRAIL’s operating profit. As a result, aggregated financial flows from CAMRAIL to the conceding authority since the beginning of the concession in 1999 amount to about US$270 million (fixed and variable concession fees, taxes, import duties, etc.) and reached US$24 million in 2012. This is a major turnaround from the situation before 1999, when annual operational losses which had to be covered by the GoC oscillated between US$7 million, and US$12 million. 19. The number of derailments has decreased by 92 percent from 180 in 1999 to about 15 in 2012. Rail modal share for freight between Douala and Ngaoundere is about 39 percent (90 percent for petroleum products) and rail transports more than two thirds of Chad’s imports and a large share of CAR exports, especially timber. However, due to increasingly obsolete signaling infrastructure, remaining deteriorated railway sections, bridges exceeding their life span, the rail system is not able to meet the growing demand for transport services for passengers or freight.
20. Rail modal competition is increasingly putting downward pressure on road-based transport prices. More specifically, tariffs per ton-km and per container are approximately 10 percent lower by rail than by road, all of which benefits the end consumers. More specifically, the price to transport a 20-feet container (28 tons) in 2012 from Douala to N’Djamena was about US$6,000 (FCFA2,700,000 by rail and road vs. FCFA3,000,000 by road only), and between US$0.13 (rail and road) and US$0.15 (road only) per ton–km. These numbers show a 15 percent
6
decrease in transport prices between 2008 and 20129. However, the per ton-km rates on the Douala-N’Djamena corridor remain among the highest in Sub-Sahara Africa (SSA), compared to US$0.06 to US$0.08 in West Africa corridors (i.e. Lome–Ouagadougou and Cotonou–Niamey), and in East Africa corridors (i.e. Mombasa–Kigali and Mombasa–Kampala), and also above the costs observed in Southern Africa (US$0.05 to US$0.06 for the corridors Durban–Lusaka and Durban–Ndola).10 However, because of non-competitive practices within the freight transport industry and inefficiencies of institutions and agencies involved, as well as weak sector governance, the reduction in vehicles operating costs are only partially transferred to users of transport services. In this regard, the MINTP will benefit from a Trucking Industry study initiated by the World Bank Poverty Reduction and Economic Management unit (PREM). The survey fielded in 2014 will provide data to the Ministry on: (a) the different business models of trucking firms operating on the corridors, and will help the Ministry engage policy dialogue with stakeholders and define policies enhancing business climate and competitiveness; (b) detailed data and lessons learned on monitoring transport prices and costs that the Ministry could follow up on; and (c) some data that could be used to assess the social impact of regulatory or policies change affecting the Trucking Industry.
C. Higher Level Objectives to which the Project Contributes
21. The proposed project is consistent with the Cameroon Country Assistance Strategy (CAS) approved by the World Bank's Board of Executive Directors on March 30, 2010. The first strategic theme of the Cameroon CAS for FY10-FY14 aims at increasing Cameroon's competitiveness, in particular through "increased infrastructure investments in the energy, transport, and telecommunication sectors". 22. Furthermore, the CAS emphasizes continued strong support to infrastructure sectors. The World Bank (WB) decision to provide additional resources to the transport sector to complete the rehabilitation of Douala-N’Djamena corridor was based on a strong request from GoC during the Mid Term Review (MTR) of this CAS.
23. The project will complement ongoing and planned road investments in support of Cameroon's 2009 Growth and Employment Strategy, which are financed by GoC and its development partners, World Bank, EU, African Development Bank (AfDB) and the French Development Agency (Agence Française de Développement, AFD). These investments are concentrated in the northern part of the country which suffers from high levels of poverty as outlined in paragraph 3 of this document, and are well aligned with the World Bank twin goals of ending extreme poverty and creating shared prosperity. They are also fully consistent with the Government’s objective of protecting vulnerable groups in general and of addressing extreme poverty in the North and Far North regions in particular. Of all populations classified in the poorest quintile of income distribution, 40 percent and 17 percent respectively are found in the North and Far North regions. In terms of evolution of poverty rates, these two regions experienced the largest increases in poverty between 2001 and 2007: 13.6 percent in the Far
9 Partial results for 2013 are actually still more encouraging and seem to show a further decrease. However, these data still need to be consolidated, reason why data only up to 2012 are considered in this document. 10 Source: Transport prices and costs in Africa: study of the main corridors. Teravaninthorn, S. and Raballand, G. – World Bank (2009).
7
North and 9.6 percent in the North, as illustrated by the Country’s Household Survey reports and the Growth and Employment Strategy Paper. To support the Government of Cameroon in reducing poverty and improving the livelihoods of populations living in these regions in particular, the World Bank and other donors present in Cameroon, have, over the last years, scaled up operations specifically targeting these geographic regions. For the World Bank, these operations include an emergency floods project, a sanitation project, the extension of an ongoing health project, an agriculture project, a social protection project, and the ongoing CEMAC transport project.
II. PROJECT DEVELOPMENT OBJECTIVES
A. PDO 24. The overarching objective of the project is to facilitate intra/inter regional trade along the Douala–N’Djamena Corridor. The project development objective is to increase multimodal transport efficiency and effectiveness along the Yaoundé–Kousseri Corridor.
Project Beneficiaries 25. The project will directly benefit residents of the Far North region (3,480,000 inhabitants, about 20 percent of the country’s population) including the cities of Maroua (400,000 inhabitants), Mora (54,000 inhabitants) and Kousseri (80,000 inhabitants), local and transit transporters and the agro-industrial companies, whose movements are seriously constrained by the current poor state of the Maroua-Mora-Kousseri corridor. Furthermore, the improvement of this section of the corridor will mean that the last severely degraded section of the transport Corridor between the Southern regions of Cameroon and the Northern regions up to N’Djamena will finally be improved, thereby facilitating the movement of intra/inter regional transport. It will also attract investment for export oriented agricultural development in the project influence area. Other beneficiaries of the project will include: road users, passengers and freight, traders from neighboring towns, agriculture, and ultimately, consumers and producers both inside and outside the northern regions of Cameroon and beyond. With road rehabilitation and maintenance activities, the project will offer new jobs and income earning opportunities to the people around the project area. The very poor condition of the Maroua-Mora section that can become impassable during the rainy season leads to the social isolation of the population in the neighboring towns and villages. It is estimated that more than half of the freight traffic to N’Djamena has been diverted through an alternative corridor in Chad via Moundou (an extra 120 km) due to the extremely deteriorated state of the Maroua-Mora section, which adversely impacts the poorest regions of Cameroon in the North and Far North, deprived from the collateral economic benefits of through-traffic. 26. The benefits of improving road sections along the Douala–N’Djamena corridor are largely related to a reduction in Vehicle Operating Costs (VOC), freight transit times and passenger travel times, as well as greater reliability in the transit of goods. Furthermore, the improvement of the corridor will reduce the long term social and environmental impacts of road/rail infrastructure development by fully developing the carrying capacity of already existing transport infrastructure. Finally, the road section is critical to complement the large rehabilitation program of the Douala–N’Djamena corridor. Improvement of the road and rail networks, along
8
with institutional strengthening in the transport sector, will not only reduce travel time and transport costs, but will also increase reliability, thereby reducing the cost of doing business and promoting economic growth. 27. The project supports the key objective of improving transport efficiency, which has been identified as one of the main drivers of economic growth. It also supports the continued implementation of needed policy and institutional reforms in road maintenance in Cameroon. The revised economic analysis for the road section demonstrates that even with the increased cost of road construction, improvement of the selected road section will yield an economic rate of return of about 53 percent, thus confirming the high economic value of the road. 28. Human Immunodeficiency Virus/Acquired Immune Deficiency Syndrome (HIV/AIDS) Mitigation. Contracts funded by the International Development Association (IDA) mandatorily include mitigation measures as recommended in the “Route to Good Living” Pamphlet11, regarding workers and site population protection in particular. In addition, CAMRAIL offers to all their employees and dependents (about 8,000 people) free HIV screening and if need be, treatment. During project supervision, compliance with these provisions will be closely monitored by the Bank team, and sensitization, prevention and counseling activities will be carried out along the corridor. 29. Employment creation. The road and rail contracts supported by the project mostly correspond to paved road rehabilitation, maintenance, and signaling, which are usually highly mechanized and/or technical and therefore not labor intensive. However, the multiplier effect, in terms of generating further employment in secondary industries and with material suppliers within the construction sector would further enhance the generated benefits. Furthermore, highly mechanized road/rail works tend to generate high skill high paying employment.
PDO Level Results Indicators 30. Expected outcomes of the proposed project, as a result of transport infrastructure improvement, and transport sector institutional strengthening and program management, include: (a) an increase in traffic to/from the project influence area, attributable to transport infrastructure improvement; and (b) a further reduction in transport cost along the project corridor. In addition, the implementation of the project will contribute to the achievement of IDA core outcome indicators, including an increase in the percentage of roads in good and fair condition on the Yaounde - Kousseri section of the Douala-N’Djamena corridor and in the freight volumes transported along the corridor by rail and road. Progress towards the attainment of the PDO will be assessed through the indicators specified in Annex 1 and below. 31. Achievements of the above development objective will be measured through the following results indicators:
a) Share in good and fair condition of the Yaoundé-Kousseri national road. (Percentage);
11 The Route to Good Living, HIV Prevention in the Transport Sector, Produced by the World Bank and EnCompass LL, 2009
9
b) Railway capacity (Number of train slots); c) Freight volumes transported along the Douala – Ngaoundere corridor by train per
year (tons); and d) Transport prices (per container between Douala and N’Djamena and per ton-km).
III. PROJECT DESCRIPTION
32. The Yaounde-Kousseri section (about 1580 km) of the Doula – Ndajamena corridor is critical since it provides access to the Northern regions of Cameroon, where poverty rates are considerably higher than elsewhere in the country. Furthermore, it provides Chad12, a landlocked country, with access to regional and international markets. It will also help Cameroon seize trade opportunities in the region13. Finally, the Douala–N’Djamena corridor, that includes the Yaounde-Kousseri section, has been identified as one of Africa’s key infrastructure backbones supported by IDA as part of its 2010 Regional Integration Assistance Strategy for Sub-Saharan Africa (RIAS). In the 2011 RIAS progress report, IDA stressed the need to continue improving cross-border growth corridors focusing on the “missing links”. 33. The proposed project will fund rail and road infrastructure improvements on the Yaounde-Kousseri corridor and will support the objective of having 90 percent of the road corridor in “fair” to “good” condition to ensure all-season access between Yaounde and Kousseri. Specifically, the project scope includes: (a) road reconstruction works on a highly degraded sixty-one (61) km road section between Maroua and Mora; (b) performance-based routine maintenance works on about 270 km of newly constructed sections from Maroua to Kousseri; (c) consulting services for the supervision and monitoring of the above mentioned works on the Maroua-Kousseri road section; (d) purchase and installation of signaling equipment for the railway line between Yaounde and Ngaoundere; (e) rehabilitation of selected metal railway bridges; (f) investments aiming at improving transport safety, including but not limited to two railroad crossings between Yaounde and Ngaoundere; and (g) infrastructure sector institutional strengthening, such as technical assistance, training, including but not limited to rail and road engineering and management, and PPPs, feasibility and detailed engineering studies, and program management.
A. Project Components 34. Component A: Roads infrastructure improvements (US$77 million, World Bank financing US$57 million, Government of Cameroon financing US$20 million). The activities to be financed under the proposed project include a combination of rehabilitation and routine maintenance works with the piloting of a Performance-based Contract (PBC) approach on the newly-rehabilitated sections of the corridor, along with possible road safety improvements, to ensure sustainability of road investments and year-round access along the Yaounde - Kousseri 12 Within Africa, CEMAC has grown to be Cameroon’s main export market, mainly petroleum products to Chad. 13 As per the July 2012 Cameroon Economic update, “The region seems to offer promising markets for Cameroonian products, especially agriculture, and may be easier to enter, as their standards would be closer to those of Cameroon. For Cameroon, this would mean consolidating its position in the CEMAC market and then capturing opportunities in the wider regional market through the Economic Community of West African States (ECOWAS).”
10
corridor. Associated supervision activities will also be included, including monitoring consultant services for both rehabilitation and performance-based maintenance and third party independent technical audits14. The ultimate objective is to increase the proportion of road in fair to good condition on the Yaoundé – Kousseri corridor to at least 90 percent by the end of this project. This component will finance: (a) the full rehabilitation of the Maroua-Mora section (61 km) through a traditional bill of quantities approach, complementing ongoing rehabilitation works under the parent CEMAC TTF project between Mora and Kousseri, co-financed by the Government of Cameroon; (b) an up to 5-year PBC for routine maintenance from Maroua to Kousseri (on a section of 270 km), fully financed by the Government of Cameroon through the RMF15; and (c) monitoring consultant services and third party independent technical audits, fully financed by IDA.
35. Component B: rail infrastructure improvements (US$9 million, World Bank financing US$9 million). The proposed activities will include: (a) modernization of the switch points and related signaling system (Yaounde-Kousseri section) to decrease travel times, and increase rolling stock turnaround times, reliability, safety and capacity of the infrastructure16; (b) the rehabilitation of selected bridges which have exceeded their life span and need urgent interventions17; (c) purchase and installation of safety lights, warning systems and gates for two railroad level crossings in Douala18; and (d) a feasibility study for the future rail-road logistic platform to be built in Ngaoundere at the northern end of the railway.
36. Component C: Infrastructure Sector Institutional Strengthening and Program Management (US$5 million, World Bank financing US$5 million). This component will finance capacity building and infrastructure sector institutional strengthening and program management, including studies following up on the ongoing CEMAC TTF Project. Activities will include capacity building and institutional strengthening in line ministries through: (a) improving planning, monitoring and implementing capacity of implementing agencies; (b) analytical work aimed at providing the right business climate for competitive transport market and following up on work initiated by PREM (Trucking Industry Survey); (c) developing an independent monitoring system of transport prices and costs trends in Cameroon; (d) carrying out an integrated environmental and social strategic assessment for the transport sector; and (e) elaborating an integrated intermodal Transport Sector Strategy in light of the country’s Growth and Employment Strategy and Vision 2035. This component will equally cover operating costs, including auditing, and monitoring and evaluation; and support to the Ministry of Public Works through the provision of: (a) advisory services, training (railway engineering, PPPs, etc…) and
14 Draft bidding documents for both the works and the monitoring consultants have already been submitted to the Bank team. 15 Dated covenants in the FA stipulates that (i) counterpart funds, estimated at US$9 million, to complement the financing of the rehabilitation works will be made available by the GoC, and (ii) the amount needed to cover routine maintenance costs, estimated at US$9 million, should be specifically allocated to this contract in the yearly budget of the FMR 16 The related bidding documents will be prepared by CAMRAIL before the end of February. 17 A detailed engineering study (including bidding documents) for the rehabilitation of 11 “fragile“ bridges is ongoing and will be completed at the end of January, while the procurement of an overall diagnostic of all bridges/tunnels/viaducts/culverts was initiated in December 18 The safety improvements measures for the two other railroad crossings in Yaounde mentioned in paragraph 10 will be financed under the ongoing CEMAC TTF Project.
11
logistical support (including office equipment, materials, supplies); and (b) operating costs, for project coordination and implementation.
B. Project Financing 37. The lending instrument for this project is an Investment Project Financing (IPF) Credit. The sources of funds will come from national IDA allocation made available in Special Drawing Rights (SDR) and from GoC in terms of counterpart funds. The terms of the national IDA credit of SDR45.9 million (US$71 million equivalent) are available under standard country terms to the Republic of Cameroon. The counterpart funding amounts to US$20 million, excluding value added tax.
Project Cost and Financing
Project Component
Total Project Cost
(US$ Million equivalent)
IDA financing
(US$ Million equivalent)
Government’s contribution
(US$ Million equivalent)
1.Roads Infrastructure Improvements
77.00 57.00 20.00
2.Rail Infrastructure Improvements 9.00 9.00 0.00
3.Transport Sector Institutional Strengthening and Program Management
5.00 5.00 0.00
Total Financing Required 91.00 71.00 20.00
C. Lessons Learned and Reflected in the Project Design
38. The ongoing regional CEMAC TTF Project alongside other similar projects funded by key development partners on the same corridor, and international experience such as in Latin America have provided the following important lessons that were incorporated into the design of the proposed project:
a) Limited information vis-à-vis unit prices and poorly updated design studies, calls for prudent cost estimates and inclusion of sufficient review of design studies in order to avoid cost overruns. The 2009 detailed engineering studies for the rehabilitation of Maroua-Mora were updated in September 2013, and the supervision consultant will do a final review of the detailed design before the works start. In addition, the supervision of the contract will be reinforced through: (i) the hiring of a third party technical auditor, in addition to the usual monitoring consultants; and (ii) the use of a road contract Performance Assessment Tool disseminated and successfully tested in several client countries.
b) The World Bank has promoted performance based contracts in a number of countries in Latin America (Argentina, Brazil and Uruguay), South Asia (India), and Africa (Mali,
12
Chad, Zambia, Botswana, Cape Verde and Liberia). Key lessons drawn from such experiences that are relevant to the project were incorporated into the project design: (a) combining rehabilitation and maintenance works is optimal from a maintenance management point of view. This will ensure that the contractor has the required incentives to deliver good quality rehabilitation works to minimize his subsequent maintenance costs, (b) longer duration of performance based contracts are prescribed to allow the contractor to spread the risks and provide for justifiable periodic maintenance cycles, and where Performance-Based Maintenance Contracts are being tried for the first time, it is preferable that the WB remains involved throughout the contract period.
c) Adequate and sustained financing for road maintenance is critical to the sustainability
of the road network and has therefore to be closely monitored. Specific policy dialogue is needed in this area, in order to provide Government with recommendations on mid-to-long term planning of maintenance needs and options to raise funding for infrastructure asset management.
IV. IMPLEMENTATION
A. Institutional and Implementation Arrangements
39. Institutional and fiduciary arrangements for the proposed project will remain the same as for the ongoing regional CEMAC Transport and Trade Facilitation Project, except for procurement as large contracts will now be handled by the Ministry of Public Procurement (Ministère des Marchés Publics, MINMAP). The Project Implementation Units (PIU) will remain the "cellule BM-BAD", a shared WB-AfDB implementing agency hosted in the Ministry of Public Works (Ministère des Travaux Publics, MINTP) for component A and C, and CAMRAIL for component B. 40. The Project implementation teams in both the Ministry of Public Works and CAMRAIL are fully in place and have been working on the ongoing regional CEMAC TTF Project since its inception, and their performance is satisfactory. The FM performance of the ongoing regional CEMAC TTF Project is equally satisfactory. As a result, it is agreed that the FM arrangements of the proposed Project will build on the achievements of the ongoing CEMAC TTF Project while keeping the full fiduciary responsibility respectively under the “cellule BM-BAD” for component A and C, and CAMRAIL for component B. The Project implementation teams are adequately staffed with the right skills mix and liaise with IDA during the implementation phase.
41. These PIUs (“cellule BM-BAD”, and CAMRAIL) have proved effective in managing project activities, even though some delays in managing procurement activities have been observed (in large part due to factors that are external to the units), but part of the workload related to procurement will now be absorbed by the MINMAP for the case of the “cellule BM-BAD”. Additional capacity building and training activities to MINMAP will be financed under the third component of the proposed project. The social and environmental safeguards unit in the MINTP has been strengthened through training and equipment acquisition. 42. The additional workload generated by the proposed project will require additional resources, especially a dedicated road engineer and a full time Monitoring and Evaluation
13
(M&E) specialist who would equally supervise facilitation activities in close collaboration with the respective focal points designated by the beneficiary agencies. The recruitment process of the road engineer is ongoing and expected to be completed before June 30, 2014, while that of the M&E specialist will be completed no later than three months after effectiveness. The subsequent incremental operating costs will be supported by the project.
B. Results Monitoring and Evaluation
43. A set of monitoring indicators has been defined at the project level. The chosen indicators will allow effective measurement of the outcome and results of the project. The overall responsibility for monitoring and evaluation of outcomes of the project will formally lie with the MINTP of Cameroon. MINTP will prepare bi-annual progress reports, with contributions from other stakeholders, and forward these to IDA within 45 days from the end of the reporting period. These reports will detail physical progress and progress in respect of the monitoring indicators in the results framework (Annex 1). The reports will also contain a summary of the status of the implementation of the Environmental Management Plan (EMP) and Resettlement Action Plans (RAPs) associated with the improvement of the physical infrastructure. 44. Supervision of large contracts by the GoC. Under the contract provisions stipulated for large Bank-financed civil works contracts, a supervision consultant, internationally qualified and recruited competitively, is required to be retained by the borrower as the ‘Engineer’ under each contract to oversee the day-to-day progress of works on the site and to certify each payment invoice, including compliance by the contractor with all technical specifications, environmental and social mitigation plans, and contractual provisions. The required supervision consultant services will be carried out accordingly, and will be complemented by a third party technical auditor supporting the “cellule BM-BAD”. 45. Bank implementation support. The WB will need to continue to mobilize a strong supervision team knowledgeable in procurement, financial management, highway construction and contracts management, social development, transport economics, and M&E.
46. Missions involving every member of the Task Team are also planned at least twice a year. Mission schedules will decrease when civil works are substantially completed. Such an intensive supervision of civil works is critical to avoid slippages in costs and construction times during construction. Supervision in the other areas of WB due diligence (such as environment, social, procurement and financial management) will be planned as needed, but at least twice a year. 47. Given the importance and the variety of aspects tackled under the Project and their impact, communication activities will also be programmed as part of project supervision. This will be achieved by involving communications officers based in the Yaoundé country office, and will include specific dissemination of sector issues and projects achievements both internally and externally. The dissemination of project activities will draw from communication dispositions already in place under the ongoing CEMAC TTF Project.
14
C. Sustainability 48. The government’s commitment towards the rehabilitation and maintenance of its priority road network is a key determinant for the sustainability of the project. This commitment is demonstrated by the constant increase of its investment and maintenance budget in the past 4 years and the recent decision to increase the RMF budget from XAF55 billion (about US$105 million) to about 70 billion (about US$145 million), the enforcement of axle load control on major road corridors including the one to be covered in this project, the openness to innovative solutions such as performance-based contracts, and the highlighting of the project’s importance in the mid-term review of the CAS. The government has also embarked on the maintenance of other segments of the corridor under an emergency road maintenance program.
V. KEY RISKS AND MITIGATION MEASURES
A. Risk Ratings Summary Table
Risk Category Rating
Stakeholder Risk Substantial
Implementing Agency Risk
- Capacity High
- Governance High
Project Risk
- Design Substantial
- Social and Environmental Low
- Program and Donor Moderate
- Delivery Monitoring and Sustainability Moderate
Overall Implementation Risk High
B. Overall Risk Rating Explanation
49. The Operational Risk Assessment Framework (ORAF) attached in Annex 1 describes the associated preparation and implementation risks. Overall risk rating for preparation of the proposed financing is rated “High” due to the time needed to process the safeguard studies and upgrade the technical studies, as well as the challenges linked to the recent procurement reform in Cameroon. The procurement of the project activities will be implemented within the context of a challenging reform climate involving various line ministries who will need to cooperate closely. Overall risk rating for implementation is also rated “High” because road works may be slow to execute based on the experience of past infrastructure works in Cameroon. However, the simplicity of the road infrastructure component of the proposed financing is expected to facilitate implementation. Based on the successful outcome of the railway component under the CEMAC TTF project, the risk related to the modest railway component focused on signaling and bridge rehabilitation is rated Moderate. The Institutional Strengthening component outcomes which are
15
largely dependent on political willingness can be unpredictable. However, the simple design of the proposed project is expected to facilitate implementation. Furthermore, the proposed project will take into account and build on experiences gained in the implementation of the on-going CEMAC TTF Project, and maintain the fiduciary management of the project within the existing AfDB-WB unit that has gained considerable experience during the life of the CEMAC TTF Project.
VI. APPRAISAL SUMMARY
A. Economic and Financial Analysis
50. Road. The proposed investments aim at rehabilitating and preserving existing high value road infrastructure assets. The overall objective is to rehabilitate in a prioritized phased manner the entire road corridor between Douala and N’Djamena, building on previous operations, and also to introduce cost-efficient maintenance practices to avoid a piecemeal, emergency maintenance approach which proves much more expensive in the long run. 51. It is anticipated that the improvement of the main road corridor between Chad and Cameroon will have a positive impact on the economy of both countries and, more specifically as far as the Maroua-Mora section is concerned, in the Northern regions of Cameroon. The rehabilitation of this section, together with the ongoing or recent rehabilitation of other parts of the corridor will strengthen economic ties between the Far North, the North and the rest of Cameroon. The improved road infrastructure also serves as the main arterial of the region and its improvement will generate substantial road user cost savings and improve per capita income at the regional level. Current traffic on the Maroua-Mora section is about 670 vehicles per day, out of which 34 percent are trucks. 52. In addition, putting in place this cost-efficient system of maintenance will: (a) reduce investment costs in the future; and (b) make sure that roads are kept in a good condition all the time, which will keep transport costs low.
53. An economic evaluation has been done using the Highway Development and Management Model (HDM-4) on the Maroua-Kousseri road link that includes the Maroua-Mora section. The return on the planned investment is high with an overall Economic Internal Rate of Return (EIRR) of 53 percent. VOCs savings represent more than 90 percent of the project benefits, while travel time savings represent the rest, as no other economic benefits have been monetized. The very high value of the EIRR is explained by the very poor condition of the Maroua-Mora road section (International Roughness Index estimated between 14 and 16), especially during the rainy season when this section is only passable with a four wheel drive vehicle. A sensitivity analysis was also carried out; if traffic was 10 percent (respectively 20 percent) lower than expected, the EIRR would go down to 48 percent (respectively 43 percent). If the investments costs were 10 percent (respectively 20 percent) higher than expected, the EIRR would go down to 49 percent (respectively 46 percent). In the most unfavorable scenario (traffic down by 20 percent, investment costs up by 20 percent), the EIRR is still estimated at 38 percent. Details of the economic analysis are provided in Annex 6.
16
54. Rail. The activities financed by the project will result in an increase in safety, and average train commercial speed which will result in higher rolling stock utilization rates and, thus, higher capacity and eventually an increase in CAMRAIL's competitiveness and traffic. The economic benefits of such an increase in traffic lie mainly in a modal shift of freight from road to rail-based transport: every ton traveling by rail is not transported by road any longer, which leads to substantial savings in terms of transport costs, fuel consumption, and external costs related to road-based transport. It is estimated that the increase in capacity expected from the upgrading of the signaling system will increase CAMRAIL turnover by 18 percent and their operational profit by FCFA 2,050 million, half of which is contractually transferred to the Compte d’Infrastructure Ferroviaire (Rail Infrastructure Account) to finance further rail infrastructure investments.
B. Technical 55. Road. The sections to be encompassed in the proposed rehabilitation and performance-based contracts have been chosen with a view to: (a) complete the rehabilitation program for the whole corridor, hence the focus on the last large section (Maroua – Mora) still in very poor condition (see table in Annex 2 that displays for each section between Yaounde and Kousseri the condition of the road and the most recent and planned interventions); and (b) secure the investments already made by IDA in Northern Cameroon under the CEMAC TTF program, making sure they will be properly maintained. 56. The decision to opt for PBCs was motivated by: (a) the need to significantly improve the way the Cameroonian road network is currently maintained and hence test innovative solutions that have been successfully tested in other parts of the world; (b) the interest expressed by the client for this type of contract; and (c) the benefits attributed to well-performing PBCs, such as an improved level of service, a transfer of risk to the contractor thereby providing surety of costs to the Ministry of Public Works, the securing of an appropriate level of multi-year financing from the Road Fund, more innovation as a result of the contractor having a financial incentive to apply new tools and/or techniques, a conscious focus on the long-term needs of the asset, etc. 57. Under PBC, the contractor selects intervention types and input quantities, with which it can meet the contractual obligations, defined in the bidding document as the required level of service - the minimum required outputs of interventions and performance of the contractor. The Level of Service (LOS) is defined as a measure that describes the operational condition of a road taking into account the road user’s point of view. A good LOS is simple and easy to evaluate, while fully capturing technical specifications that represent desirable quality of a road. The key determinants of LOS in this project are: (a) road user service, comfort and safety; and (b) road durability. 58. Road user service and comfort measures are expressed in terms of roughness, width, rutting, skid resistance, vegetation control, visibility of road signs and markings, drainage of the pavement, and responsiveness to clean out debris and rocks that compromise user safety. Road durability is measured in terms of pavement strength. The draft bidding documents have defined the minimum standards of handover of the roads after the multi years PBC.
59. The proposed contract will include the rehabilitation and subsequent maintenance of the
17
Maroua-Mora section and the maintenance of three road sections which are currently rehabilitated (Mora-Dabanga and Dabanga – Kousseri) or built (Kousseri by pass). Based on the procurement plan, it is assumed that this contract will be signed by end 2014, and that the rehabilitation works between Maroua and Mora will start during the 1st quarter of 2015. The contractor will be in charge of the routine maintenance of these three sections as soon as their rehabilitation or construction is completed, starting simultaneously with the one-year defect liability period. Each of these sections will be under performance-based routine maintenance during 4 to 5 years, according to the end date of the rehabilitation works, and until December 31, 2020. During the defect liability period, should any defect be detected, the contractor that carried out the rehabilitation will be legally responsible to rectify it. 60. Rail. Safety is the common denominator of the three proposed investments on the railway network. The proposed investment in signaling will make it possible to safely increase train block capacity19, through an increase in the commercial speed of trains (thanks to the mechanization of switches, thus requiring less human intervention, generating savings in stopping times at the sidings), and through the modernization of the signal systems, including train presence detection and interlocked with switch positions to prevent trains from moving onto a track if there is oncoming traffic to prevent unsafe train movements. The proposed purchase and installation of safety lights, warning systems and gates for two railroad crossings will reduce the number of accidents at these crossings. The rehabilitation of two metal bridges that will be on the verge of collapse in a few years if not taken care of will prevent serious accidents and also make unnecessary the current speed restrictions required by the poor condition of these bridges, and hence increase the average commercial speed of the trains.
C. Financial Management
61. The Project Implementation Unit will remain the "Cellule BM-BAD", a shared WB-AfDB implementing agency hosted in MINTP. The proposed Financial Management (FM) and disbursements arrangements for the implementation of the project comply with the provisions of the Financial Management Manual for World Bank-financed Investment Operations dated March 1, 2011. 62. The Cellule BM-BAD’s financial management system has been assessed to determine if: (a) adequate financial management arrangements (staffing, budgeting, accounting, internal control, reporting, external audit) are in place to ensure that the project funds will be used for its intended purposes in an efficient and economical way; (b) financial reports will be prepared in an accurate, reliable, and timely manner; and (c) project’s assets will be safeguarded properly. The assessment concludes that, once all the mitigating measures are properly implemented, the Cellule BM-BAD’s financial management system is adequate and complies with the Bank’s requirements under Operations Policy/Bank Procedure (OP/BP)10.00. 63. The overall residual risk rating is Moderate. The assessment recommends the following mitigation measures: (a) the amendment of Terms of References (TORS) of existing independent
19 The Cameroon railway network is built as a single track line, with sidings at various points where trains moving in opposite directions can meet and pass each other (passing sidings). The capacity of a railway line is inversely proportional to the longest time for trains to move between passing sidings.
18
external auditors for the audit of project’s annual financial statements; (b) the upgrading of the existing computerized information system to record the project’s transactions and preparation of Quarterly Interim Unaudited Financial Reports whose format was agreed on during negotiations; and (c) the amendment of existing administrative and financial procedures’ manual to integrate this project. 64. The detailed financial management arrangements are described in Annex 3 65. FM Conditions and FM covenants
a) The amendment of existing administrative and financial procedures’ manual to integrate this project;
b) The upgrading of existing computerized information system no later than 2 months after effectiveness; and
c) The recruitment of an external auditor no later than 6 months after effectiveness.
D. Procurement 66. The procurement risk assessment focused on the procurement capacity assessment of the cellule BM-BAD within MINTP, with the involvement of MINMAP for high value contracts for components A and C, and on the assessment of CAMRAIL for component B. 67. The assessment of CAMRAIL’s capacity for the purpose of the project found that: (a) the Procurement Specialist currently on board is qualified, but needs to be maintained to work on this new project,or any other procurement specialist with similar qualifications; (b) the Procedural Manual needs to be updated.
68. The capacity assessment of the cellule BM-BAD within MINTP with the involvement of MINMAP for high value contracts, for the purpose of the project found that: (a) at present there is no qualified procurement specialist within the cellule, but the recruitment process is underway; (b) the operational manual including a section on procurement will need to be updated; (c) MINMAP needs to have a comprehensive record keeping system; and (d) while the motivation of the 2011 procurement reform is understood, some aspects of the new institutional arrangements raise concerns with respect to technical and legal responsibility and related regulatory issues.
69. Mitigation action plans have been developed for both entities (See details in annex 3).
70. The overall project procurement risk at the time of assessment is High. The satisfactory implementation of the above action plans will reasonably bring this overall risk to Substantial.
71. Procurement Plan. A first Simplified Procurement Plan provides the basis for the procurement methods, and covers the first 18 months of project implementation. The final version of this procurement plan was discussed and agreed upon by the Recipient and the project team at negotiations. It will be available in the project’s database and a summary will be disclosed on the WB’s external website once the project is approved by the Board. The Procurement Plan will be updated in agreement with the Project Team annually or as required to reflect the actual project implementation needs and improvement in institutional capacity.
19
E. Environment and Social (including Safeguards) 72. The project is designated Category B per the Bank’s policy on Environmental Assessment (OP/BP 4.01). This suggests that environmental and social impacts of the project, for the most part, will be minimal, site-specific and manageable to an acceptable level. What follows is description of the social and environmental impacts of the project consistent with World Bank policies.
OP 4.01: The project supports the rehabilitation of 61 km deteriorated road section (Maroua-Mora). The project activities may have environmental and social impacts that need to be correctly managed. An Environmental and Social Impact Assessment (ESIA) including the appropriate environmental and social mitigation and management measures (ESMP) was prepared and disclosed by the borrower prior project appraisal. The loss of natural habitats is not anticipated as the initial road footprint will not be modified.
OP. 4.11: The proposed operation will involve significant excavations and movement of earth for the planned rehabilitation. The Environmental and Social Impact Assessment (ESIA) has not yet anticipated any threat against physical cultural resources, and the ESMP which forms part of the ESIA includes clear procedures that will be required for identification, protection of cultural property from theft, and treatment of discovered artifacts, and is included in the bidding documents. The ESIA/ESMP provides procedures for handling with “chance finds” during implementation project activities.
OP. 4.12: This policy is triggered to assist in management of involuntary resettlement, land acquisition or restriction of access to assets in the project areas during the whole Maroua-Mora road section rehabilitation process. A RAP acceptable to the Bank has been prepared by the borrower. The RAP includes procedures for identifying eligible project-affected people, calculating and delivering compensation, and mechanisms for redress of dispute grievances. Well documented consultation mechanisms will be required to establish eligibility for compensation. The RAP will be implemented prior to beginning of works on the project site.
OP. 4.36 Forests: This policy is triggered due to fact that the ESIA identified that more than 3400 trees will be lost and 10000 trees will be planted during project implementation.
73. Public Consultations. Extensive public consultations were carried out during the whole ESIA process from December 2013 to January 2014. More than 660 persons attended the consultation meetings organized in the project area. The Local population expressed concerns and expectations that were summarized in the ESIA final report. The Public Consultation continues throughout project implementation with the involvement of civil society, Project-Affected People (PAP), and various stakeholders. All environmental safeguards final documents were disclosed on the Ministry of Public Works website on March 3, 2014 and through the Bank’s Infoshop on March, 7, 2014. The RAP was disclosed on the Ministry of Public Works website and through the Bank’s Infoshop on March, 14, 2014
20
74. ESMP management and capacity building. The implementation arrangements for the ESMP are fully integrated with the overall implementation arrangements of the project. Public Works Ministry has the ultimate responsibility for the project’s compliance with Cameroonian legislation and Bank safeguards guidelines. Public Works Ministry coordinates closely with the Ministries involved in the project, notably Ministry in Charge of Environment, the Ministry of Economy and Regional Planning (Ministère de l'Economie, de la Planification et de l'Aménagement du Territoire, MINEPAT), and the Ministry in Charge of Compensation. 75. Environmental and Social Strategic Assessment in the Public works sector. The 2009 Growth and Employment Strategy, covering 2009-2019, is anchored in the “Vision 2035” which envisages significant investments in infrastructure. The project will also facilitate a systematic process for evaluating the environmental consequences of the proposed programs initiatives in order to ensure that they are fully included and appropriately addressed at the earliest appropriate stage of decision making process.
F. Other Safeguards Policies Triggered
Safeguard Policies Triggered by the Project Yes No TBD
Environmental Assessment OP/BP 4.01 X
Natural Habitats OP/BP 4.04 X
Forests OP/BP 4.36 X
Pest Management OP 4.09 X
Physical Cultural Resources OP/BP 4.11 X
Indigenous Peoples OP/BP 4.10 X
Involuntary Resettlement OP/BP 4.12 X
Safety of Dams OP/BP 4.37 X
Projects on International Waterways OP/BP 7.50 X
Projects in Disputed Areas OP/BP 7.60 X
.
21
Annex 1: Results Framework and Monitoring
CAMEROON: Multimodal Transport Project Project Development Objective (PDO):
To increase multimodal transport efficiency and effectiveness along the Yaoundé–Kousseri Corridor
These results are at: PDO Indicators
Cor
e Unit of Measure
Baseline
Cumulative Target Values**
FrequencyData Source/Methodology
Responsibility for Data
Collection YR 1
YR 2
YR3
YR 4
YR5
YR6
YR7
PDO Indicator One: Share in good and fair condition of the Yaoundé-Kousseri national road20.
Percentage 65 70 80 83 87 87 87 87 Yearly
Field inspection and road
management system
Cellule BAD-BM
PDO Indicator Two: Number of train slots
Number 25 25 25 29 29 29 29 29 Yearly CAMRAIL Cellule BAD-
BM
20 The achievement of this target also depends on the successful outcome of the ongoing CEMAC Transport and Trade Facilitation Project which finances several key rehabilitation contracts along this corridor between Yaounde and Kousseri (1580 km), for a total length of about 312 km, i.e. 20 percent of the corridor. Maroua-Mora (61km) represents 6 percent of the corridor, but the section that will be maintained under this project, i.e. Maroua-Kousseri, is 271 km – long, i.e. approximately 27 percent of the Yaounde-Kousseri corridor. The end target value of this indicator reflects only the outcome of IDA-funded projects, i.e. the CEMAC TTF and the proposed Multimodal Transport Project.
22
PDO Indicator Three: Freight volumes transported along the Douala – Ngaoundere corridor by train per year
Million
Tons 1.9 1.9 2.0 2.1 2.1 2.2 2.2 2.3 Yearly
CAMRAIL operational
data
Cellule BAD-BM
PDO Indicator Four: Average transport prices (per container between Douala and N’Djamena and per ton-km)21
US$
thousands US$ cents
6.0
15
6.0
15
6.0
15
5.8
15
5.6
14
5.6
14
5.6
14
5.6
14 Yearly
Monitoring system of transport
prices under Comp. 2
Cellule BAD-BM
21 The team will track transport prices but will also break down these price in order to differentiate what the project can be held accountable for (for example the amount of diesel consumed per trip) from what the project cannot be held accountable for (for example the price of a liter of diesel).
23
INTERMEDIATE RESULTS INDICATORS
Intermediate Result (Component A): Roads Infrastructure Improvements Intermediate Result indicator One: km of road rehabilitated
km 0 0 0 45 61 61 61 61 Yearly Road
Management System
Cellule BAD-BM
Intermediate Result indicator Two: km of road maintained under PBCs
Km 0 0 204 249 265 265 265 265 Yearly Road
Management System
Cellule BAD-BM
Intermediate Result indicator Three: Number of vehicles per day between Maroua - Mora
Number 670 670 700 725 740 765 785 800Every two
years Traffic counts
Cellule BAD-BM
Intermediate Result (Component B): Rail Infrastructure Improvements Intermediate Result indicator Four: signaling modernized between Yaounde and Ngaoundere
Yes/No No No Yes Yes Yes Yes Yes Yes Yearly CAMRAIL operational
data
Cellule BAD-BM
Intermediate Result indicator Five: wagon turnaround time
Days 8 8 8 7 7 7 7 7 Yearly CAMRAIL operational
data
Cellule BAD-BM
Intermediate Result indicator Six: number of railway bridges rehabilitated
Number 0 0 2 2 2 2 2 2
At mid-term and project closing
CAMRAIL operational
data
Cellule BAD-BM
Intermediate Result (Component C): Transport Sector Institutional Strengthening and Program Management
Intermediate Result indicator Seven: Validation of an integrated intermodal transport infrastructure sector strategy
Yes/No No No No No Yes Yes Yes Yes Yearly Ministry of
Public Works
Cellule BAD-BM
24
Results Framework and Monitoring
CAMEROON: Multimodal Transport Project
Results Framework
Project Development Indicator Transport Effectiveness The effectiveness of a transport system
between A and B is its capacity to produce the expected result, i.e. transporting goods and/or passengers between A and B.
Transport Efficiency A transport system is all the more “efficient” that it uses less inputs such as money, time, labour… to create the greatest amount of outputs, measured as the quantity of freight or number of persons transported between A and B.
Project Development Objective Indicators Indicator Name Description (Indicator definition etc.)
Share in good and fair condition of the Yaoundé-Kousseri national road. (Percentage)
This indicator measures the percentage of the Yaoundé-Kousseri national road that is in good and fair condition (IRI<4) depending on the road surface condition. The achievement of this target also depends on the successful outcome of the ongoing CEMAC Transport and Trade Facilitation Project which finances several key rehabilitation contracts along this corridor between Ngaoundere and Kousseri: Ngaoundere – Mbe (20 km out of 70 km), Mbere- Ngaoundere (89 km), Mora – Dabanga (131.5 km), Dabanga – Kousseri (72 km) of roads, including the Kousseri by-pass (to Chad border). Some of the remaining stretches between Ngaoundere and Garoua are under periodic maintenance financed by the RF; there are equally ongoing rehabilitation works between Garoua and Maroua financed by the EU and the AfDB. Taking into account only those works which are being financed by IDA and the proposed project, for which the team is accountable, the share in good condition is expected to reach 87 percent at the end of the project. However, other donors such as the EU are currently considering rehabilitating some more sections currently in bad condition, and to have them maintained afterwards under
25
PBC, so the aggregated indicator is likely to exceed this value at the end of the project.
Number of train slots This relates to the theoretical capacity of the line, expressed in available train slots per day, i.e. the number of trains that can be operated per day on the rail network as a result of the proposed investments (to be compared to the number of trains that could be operated per day at project appraisal, i.e. 25 trains per day).
Freight volumes transported along the corridor by train (Tons)
This indicator measures the volumes of freight transported by train - along the Douala-Yaounde-Ngaoundere railway line. The team recognizes that this indicator is also influenced by endogenous factors such as macro-economic conditions, safety/security issues which can be critical in this part of the world, etc… However, this is a core indicator for the transport sector.
Transport prices (per container between Douala and N’Djamena and per ton-km)
This indicator measures the average price of transporting a container between Douala and N’Djamena and a ton of freight over a km on that same corridor, taking into account both rail- and road-based transport and their respective market shares. The data will be collected from CAMRAIL, the railway concessionaire, who for obvious reasons and as part of their commercial strategy, needs to regularly monitor road-based transport prices before setting their own prices. The team will track transport prices but will also break down these prices in order to differentiate what the project can be held accountable for (for example the amount of diesel consumed per trip) from what the project cannot be held accountable for (for example the price of a liter of diesel). Differentiated data will also be available for road- based on one hand, and rail-based on the other hand, transport prices.
Intermediate Results Indicators Description (Indicator definition etc.) km of road rehabilitated Number of km of road rehabilitated under the
proposed PBC km of road maintained under PBCs Number of km of road maintained every year
under the proposed PBC (However additional PBCs are expected to be tendered in the medium term, financed by other donors). The
26
proposed end-of-project target takes into account only the proposed IDA-funded PBC.
Number of vehicles per day between Maroua and Mora
Vehicles using the section to be rehabilitated will be counted every two years, and to the extent possible, a differentiation will be made between heavy-duty vehicles and lighter ones.
Signaling modernized between Yaounde and Ngaoundere
Modernization of the signaling system of the railway between Yaounde and Ngaoundere
Wagon turnaround time Time needed for a wagon to do a return trip Douala-Kousseri (8 days at appraisal).
Number of railway bridges rehabilitated Self-explanatory. The rehabilitation of these bridges will make it possible to maintain the current axle load limit (19 tons) and to waive the speeds restrictions when crossing these bridges.
Validation of an integrated intermodal Transport Infrastructure Strategy
Preparation and adoption of the Transport Infrastructure Strategy to be prepared under Component 2
27
Annex 2: Detailed Project Description
CAMEROON: Multimodal Transport Project A. Road Infrastructure Improvement – about US$77 million (WB financing US$57 million; GoC US$20 million)
1. The activities to be financed under the proposed component include rehabilitation of 61 km of the Maroua-Mora road and routine maintenance works on the newly-rehabilitated sections from Maroua to Kousseri covering some 270 km, along with possible road safety improvements between Douala and Kousseri. Associated supervision activities22 will also be funded under this component. The supervision of the contract will be reinforced by: (a) hiring a third party road expert to support the “cellule BM-BAD” (internationally qualified and recruited competitively); and (b) the use of a road contract Performance Management Tool that has been successfully tested in several client countries. 2. The ultimate objective is for the Yaounde–Kousseri corridor to be in fair-to-good condition over at least 90 percent of its length by the end of this project, based on the outcome of the proposed project and ongoing works, some of which are being carried out with the Bank-supported CEMAC TTF Project. 3. The 2009 detailed engineering studies for the rehabilitation of Maroua-Mora were updated in September 2013, and the monitoring consultants will be requested to do a final review of the detailed design before the works start. 4. The civil works under this component involving the rehabilitation works on the Maroua–Mora section, and the routine maintenance works on the Maroua–Kousseri road section will be contracted out to a single contractor, to ensure that the contractor has the required incentives to deliver good quality rehabilitation works to minimize his subsequent maintenance costs. Based on key lessons drawn from such experiences, the envisioned duration of the project will allow the contractor to spread the risks and provide for justifiable periodic maintenance cycles.
5. The Maroua – Mora road section is currently in very poor condition with an estimated IRI varying from 14 to 16. Its construction in the present alignment was completed in 1975 with a double bituminous surface dressing on the 6 meter wide carriageway and with 0.50 meter wide shoulders each side in single bituminous surface dressing. Various maintenance interventions have been carried out but since 2005 it became apparent that the applied double bituminous surface dressing had started raveling and since then several resealing or shallow overlay have been executed. These have now become uneconomical due to aging of the pavement with total failure of both the base and foundation courses in most part of the road section. The proposed rehabilitation with a design speed of 80 km/hr will consist of re-working and stabilizing the existing pavement, placing new crushed aggregate base and double bituminous surface dressing. It will have a 7 meter pavement width and 2 X 1.5 meter shoulders. This will also include improvement of drainage by replacing some old culverts with new larger size ones and
22 Draft bidding documents for both the works and RFPs for the monitoring consultants are already being reviewed by the Bank team.
28
excavation of a flood diversion channel where needed. Furthermore at various locations the alignment needs improvement to meet safety requirements. 6. The GoC's RMF will finance the maintenance part of the PBC for rehabilitation and routine maintenance from Maroua to Kousseri (on a section of 270 km), estimated at about US$9 million over 5 years. It is expected that the RMF will increase its capacities in planning, and its ability to leverage, and commit, the related funds. To address these issues, the Ministry of Public Works has engaged in a policy dialogue with all donors active in the road sector on how best to optimize the use of RMF resources, so that larger-scale, effective maintenance contracts financed by the RMF can be carried out expeditiously and efficiently to increase the sustainability of the current investments. In this regard, the EU is ready to complement the Bank’s activities by also implementing PBCs on some other stretches of the Yaounde – Ngaoundere road, as well as expanding axle load control. 7. The sections to be encompassed in the proposed rehabilitation and performance-based contracts have been chosen with a view to: (a) completing the rehabilitation program of the whole corridor, hence the focus on the last large section still in very poor condition (see table below that displays for each section between Yaounde and Kousseri the condition of the road and the most recent and planned interventions); i.e. Maroua-Mora; and (b) securing the investments already made by IDA in Northern Cameroon under the CEMAC TTF Project, making sure they will be properly maintained.
29
Table 2.1: Condition of road sections between Yaounde and Kousseri and most recent and planned interventions
23 BADEA (Arab Bank for Economic Development in Africa), KFAED (Kuwait Fund for Arabic Economic Development), HIPC (Highly Indebted Poor Countries), OPEC (Organization of Petroleum Exporting Countries), IDB (Islamic Development Bank), SFD (Saudi Fund for Development) and MINTP (Ministry of Public Works).
Road Sections Length (km)
Asphalted in
Condition Comments
YAOUNDE – AYOS 136 1994 Good
Periodic maintenance works funded by the EU in 2010
AYOS - BONIS 191 2011 Good BADEA, KFAED, HIPC, OPEC, IDB, SFD and MINTP23.
BONIS - BERTOUA -MANJOU 12 1985 Mediocre No funding identified at the time of appraisal MANJOU- GAROUA BOULAI 245 2001 Good Funded by the UE in 2001 / well maintained GAROUA BOULAI - NANDEKE 86 2013 Good
Funded by the UE (still under the defect liability period)
NANDEKE - MBERE 72 2013 Good BAD-funded nearly completed works MBERE - NGAOUNDERE 89 2013 Good
WB/EU/BAD-funded nearly completed rehabilitation works
NGAOUNDERE - MBE 70 1974 Mediocre
WB-funded ongoing spot improvements works complemented by Road Fund works (Programme Spécial d'Urgence - 25 km). However, this does not cover the whole section; EU (or BDAC) is envisaging to rehabilitate this section and to include it under a PBC up to Maroua MBE - GAROUA 204 1974 Mediocre
GAROUA - FIGUIL 95 1977 Good EU-funded rehabilitation in 2009 FIGUIL - MAGADA - PK 22 72 1977 Good
EU-funded nearly completed rehabilitation works
PK 22-PK 30 8 1977 Mediocre EU is envisaging to fund the periodic maintenance of this section and to include it under a PBC up to Maroua
PK 30 - MAROUA 36 1977 Mediocre MAROUA - MORA 61 1976 Bad
Rehabilitation to be funded by the proposed project
MORA - DABANGA 131.5 1972 Bad WB-funded ongoing rehabilitation works DABANGA - KOUSSERI 72 1972 Bad WB-funded ongoing rehabilitation works TOTAL 1580.5
Good or Fair 986 62%
Bad or Mediocre 594.5 38%
30
8. The decision to opt for PBCs was motivated by: (a) the need to significantly improve the way the Cameroonian road network is currently maintained and hence test innovative solutions that have been successfully tested in other parts of the world; (b) the interest expressed by the client for this type of contract; and (c) the benefits attributed to well-performing PBCs, such as an improved level of service, a transfer of risk to the contractor thereby providing surety of costs to the Ministry of Public Works, the securing of an appropriate level of multi-year financing from the Road Fund, more innovation as a result of the contractor having a financial incentive to apply new tools and/or techniques, a conscious focus on the long-term needs of the asset, etc. 9. Under PBC, the contractor selects intervention types and input quantities, with which it can meet the contractual obligation, defined in the bidding document as the required level of service - the minimum required outputs of interventions and performance of the contractor. PBC involves a significant shift away from more traditional approaches to the delivery and maintenance of road infrastructure and associated services by departing from the client having responsibility for the design and supervision of construction and maintenance activities, to focus upon the key outcomes that the client wishes to achieve and incentivizing the achievement of those outcomes. The LOS is defined as a measure that describes the operational condition of a road taking into account the road user’s point of view. A good LOS is simple and easy to evaluate, while fully capturing technical specifications that represent desirable quality of a road. The key determinants of LOS in this project are: (a) road user service, comfort and safety; and (b) road durability. 10. Road user service and comfort measures are expressed in terms of roughness, width, rutting, skid resistance, vegetation control, visibility of road signs and markings, drainage of the pavement, and responsiveness to clean out debris and rocks that compromise user safety. Road durability is measured in terms of pavement strength. The draft bidding documents have defined the minimum standards of handover of the roads after the multi years PBC.
11. The proposed contract will include the rehabilitation and subsequent maintenance of the Maroua-Mora section and the maintenance of three road sections which are currently rehabilitated (Mora-Dabanga and Dabanga – Kousseri) or built (Kousseri by pass). Based on the procurement plan, it is assumed that this contract will be signed around October 2014 (the bidding documents have been fine-tuned during the appraisal mission of February 2014) and that the rehabilitation works between Maroua and Mora will start in March 2015. The contractor will be in charge of the routine maintenance of these three sections as soon as their rehabilitation or construction is completed, starting simultaneously with the one-year defect liability period. Each of these sections will be under performance-based routine maintenance during 4 to 5 years, according to the end date of the rehabilitation works, and until December 31, 2020. During the defect liability period, should any defect be detected, the contractor that carried out the rehabilitation will continue to be held responsible and obliged to fix it. The sequencing of the different phases of the rehabilitation and maintenance program on the Maroua-Kousseri section is summarized in the graph below:
31
Table 2.2: Sequencing of the rehabilitation and maintenance program on the Maroua-Kousseri section
B. Rail Infrastructure Improvements – about US$9 million (WB financing)
12. This component would support the investment program for the period between 2009 and 2020 agreed by the Government and Cameroon Rail (CAMRAIL) via the 2nd amendment to the concession contract signed on November 4, 2008, in order to continue the rehabilitation of railway infrastructures. 13. The Team expects this component financing to contribute more significantly to: (a) increase competitiveness of the rail system and help traffic increase; (b)strengthen the financial viability by ensuring additional revenues from the combined effect of rolling stock recently purchased and improvements of the infrastructure. 14. The proposed investment in the Railway Component is expected to yield substantial economic benefits, the bulk of which are related to safety improvements and a modal shift from road to rail. Cost and time savings as well as fewer road accidents and fatalities are expected from the improvement of the rail infrastructures and the operation of new rolling stock. The investment will also improve connectivity between, on one hand, the country’s capital city and its main commercial port, and, on the other hand, its low income Northern regions. It will also preserve road infrastructure. A more successful concession will also have reputational benefits for Cameroon which is actively seeking foreign direct investment. B.1 Mechanization of the switch points and related signaling system (US$6,250,000) 15. Cameroon railway is built as a single track line, with sidings at various points where trains moving in opposite directions can meet and pass each other (stations or passing loops). The capacity of a railway line is determined by the longest time for trains to move between stations, and incidentally, by the crossing time in the passing loops, which is in turn determined by the efficiency of the signaling system. 16. There is a limit to the track capacity which depends on the running speed of the trains. The proposed investment will make it possible to increase capacity by about 15 percent, through an increase in the running speed of trains by reducing the crossing times. More specifically, the mechanization of currently manned switches, and the modernization of the signaling will save on crossing and stopping times. Additionally, the train detection devices interlocked with switch positioning will increase the level of safety by preventing trains from moving against an upcoming traffic.
Maroua ‐ Mora
Mora ‐ Dabanga
Dabanga ‐ Kousseri
Contournement Kousseri
performance‐based maintenance (PBMC)
defect liability period + PBMC
rehabilitation
20202018 20192014 2015 2016 2017
32
17. Between Douala and Ngaoundere, a distinction had to be made between Douala-Yaounde (Transcam 1), and Yaounde–Ngaoundere (Transcam 2): Transcam 1 is already equipped with an automatic, remote-controlled signaling and switch system and traffic on this section is expected to continue growing fast, due to the construction of the deep sea port of Lolabé, and of the exploitation of the alumina mining site in Ngaoundal.
18. Transcam 2 signaling and switch system is still operated manually, generating time and productivity losses. Modernizing this section will make it possible to add about 7 to 8 train slots to the existing 25 to 26 slots per day, hence a capacity increase of about 15 percent. About US$5 to US$6 million will be allocated to this component in order to modernize Transcam 2 switches, in order to reach the above-mentioned capacity increase and to decrease travel times, increase rolling stock turnaround times, reliability, and safety of the infrastructure. B.2 Rehabilitation of bridges which have reached the end of their design life and need urgent interventions (US1,700,000)
19. The railway infrastructure between Douala and Kousseri comprises about 30 metallic bridges, 20 concrete bridges, 3 viaducts, 4 tunnels, and more than 2000 culverts. Some of these are in poor condition and need to be rehabilitated, especially a few metallic bridges which are reaching the end of their useful life. A detailed engineering study (including bidding documents) for the rehabilitation of 11 “fragile bridges was completed in February 2014, while the procurement of an overall diagnostic of all bridges/tunnels/viaducts/culverts was initiated in December. 20. The risks inherent to this situation are linked to: (a) a potential total interruption of traffic because of the single track in case of an accident on one of these bridges; (b) serious traffic accidents, the span of some bridges reaching up to 500 meters; and (c) severe pollution of river streams in case of an accident involving wagons transporting petroleum products.
21. The location of bridges that will be rehabilitated through this project has been confirmed at appraisal based on: (a) the outcome of the above-mentioned study on 11 “fragile” bridges; (b) the level of emergency of the proposed repairs; and (c) the amount of available IDA funds. It was eventually decided to focus at least on those two bridges with the largest span (120 and 80 meters) and whose rehabilitation cost represents about 80 percent of the required investment for the 11 bridges (the span of the remaining 9 being significantly shorter), and to possibly include more briges into the scope of this credit depending on the outcome of the tender. The remaining funds needed to complement this bridge rehabilitation program will be coming from the CIF, or, if needed, advanced by the concessionaire. This whole program will make it possible to maintain the current axle load limit of 19 tons and to waive local speed restrictions set below the track's normal speed limit as the trains approach and cross those bridges.
22. The proposed works will consist of: (a) strengthening of the supporting structure (uprights, stringers, longerons, etc.) by welding and bolting; (b) laying of reinforcing plates; (c) sandblasting and anti-corrosion painting treatment; and (d) fixing of cracks in the abutments.
33
B.3 Safety interventions on two railroad level crossings (US$840,000) 23. This sub-component will finance the purchase and installation of safety lights, warning systems and gates on two railroad level crossings where severe accidents happened over the last years and which could very probably have been avoided with the proposed equipment. These railroad level crossings are located in Douala.
B.4 Feasibility study for a future rail / road logistic platform (US$210,000) 24. The need for a more spacious and modern railroad platform in Ngaoundere at the northern end of the railway was identified years ago to increase storage capacity and make operations more efficient. However, the land originally attributed to this project has been reassigned to other uses. As a result, it has become necessary to carry out a multi-criteria analysis on the pros and cons of the couple of alternative location options proposed by the Government and the concessionaire, and to carry out a feasibility study for the most promising one. C. Transport Sector Institutional Strengthening and Project Management – about US$5 million (WB financing US$5 million) 25. This component will finance capacity building and transport sector institutional strengthening and program management. The Ministry of Public Works requested the World bank in February 2014 to increase its support in this area, in view of the upcoming challenges that his Ministry will have to face as its attributions will be broadened to additional areas such as rail infrastructure and the development of PPPs. Activities will include, capacity building and institutional strengthening in line ministries through: (a) improving planning, monitoring and implementing capacity of implementing agencies; (b) analytical work aimed at providing the right business climate for competitive transport market and following up on the work initiated by PREM24 (Trucking Industry Survey); (c) developing an independent monitoring system of transport prices and costs trends in Cameroon; (d) carrying out an integrated environmental and social strategic assessment for the transport sector; and (e) elaborating an integrated intermodal transport infrastructure sector strategy in light of the country’s Growth and Employment Strategy and Vision 2035. 26. This component will equally cover operating costs, including audit, and monitoring and evaluation; and support to the Ministry of Public Works through the provision of advisory services, training (railway engineering, PPPs, etc.) and logistical support (including office equipment, materials, supplies) and operating costs, for project coordination and implementation.
24 Such activities could include, depending on the outcome of the above-mentioned survey that are scheduled to be available and disseminated in the second half of 2014: (a) policy dialogues with stakeholders on policy options to improve competitiveness; (b) further specific analytical work related to feasibility of policies options identified during policy dialogue (e.g. access to finance, regulatory constraints of trucking on transit, impact of different options on government revenue, poverty and transport prices/costs, etc.); (c) repeating the survey (fully or partially) at the end of the project.
34
Annex 3: Implementation Arrangements
CAMEROON: Multimodal Transport Project A. Project Institutional and Implementation Arrangements 1. Institutional and fiduciary arrangements will remain the same as for the regional CEMAC Transport and Trade Facilitation Project, except for procurement as large contracts will now be handled by the Ministry of Public Procurement (Ministère des Marchés Publics, MINMAP) as agreed recently between the WB and the GoC for any new IDA-funded project. The Project Implementation Units (PIU) will remain the " Cellule BAD- Banque Mondiale ", a shared WB-AfDB implementing agency hosted in the Ministry of Public Works (Ministère des Travaux Publics, MINTP) for component A and C, and CAMRAIL for component B. 2. The Project implementation teams in both the Ministry of Public Works and CAMRAIL are fully in place and have been working on the ongoing regional CEMAC Transport and Trade Facilitation Project since its inception, and their performance is satisfactory. The FM performance of the ongoing regional CEMAC Project is equally Satisfactory. As a result, it is agreed that the FM arrangements of the proposed Project will build on the achievements of the ongoing CEMAC Transport regional Project while keeping the full fiduciary responsibility respectively under the “Cellule BAD-BM” for component A and C, and CAMRAIL for component B. The Project implementation teams are adequately staffed with the right skills mix and liaise with IDA during the implementation phase.
3. These PIUs (“Cellule BAD- Banque Mondiale”, and CAMRAIL) have proved effective in managing project activities, even though some delays in managing procurement activities have been observed (in large part due to factors that are external to the units), but part of the workload related to procurement will now be absorbed by the MINMAP for the case of the “Cellule BAD- Banque Mondiale”. Additional capacity building and training activities to MINMAP will be financed under the third component of the proposed project. The safeguards unit in the MINTP has been strengthened through training and equipment acquisition.
4. The additional workload generated by the proposed project will require additional resources, especially a dedicated road engineer and a full time M&E specialist who would equally supervise facilitation activities in close collaboration with the respective focal points designated by the beneficiary agencies. The recruitment process of the road engineer is ongoing and expected to be completed before June 30, 2014, while that of the M&E specialist will be completed no later than three months after effectiveness. The subsequent incremental operating costs will be supported by the project.
35
B. Financial Management, Disbursements and Procurement Financial Management and Disbursements 5. The Project Implementation Unit will remain the "Cellule BM-BAD", a shared WB-AfDB implementing agency hosted in the Ministry of Public Works (Ministère des Travaux Publics, MINTP) for component A and C, and CAMRAIL for component B. 6. The proposed financial management and disbursements arrangements for the implementation of the project comply with the provisions of the Financial Management Manual for World Bank-financed Investment Operations dated March 1, 2011.
7. The Cellule BM-BAD BAD and CAMRAIL have been managing adequately ongoing Regional Transport Pproject (P079736) co financed by ADB and World Bank. The Cellule is endowed with one Finance Officer, two (2) accountants and one Internal Auditor. No overdue audit report to date and external auditor opinion on last financial audit report is unqualified.
8. The Cellule BM-BAD and CAMRAIL’s financial management systems have been assessed to determine if: (a) adequate financial management arrangements (staffing, budgeting, accounting, internal control, reporting, external audit) are in place to ensure that the project funds will be used for its intended purposes in an efficient and economical way; (b) financial reports will be prepared in an accurate, reliable, and timely manner; and (c) project’s assets will be safeguarded properly. The assessment concludes that, once all the mitigating measures are properly implemented, the Cellule BM-BAD’s financial management system is adequate and complies with the Bank’s requirements under Operations Policy/Bank Procedure (OP/BP)10.00. 9. The overall residual risk rating is Moderate. The assessment recommends the following mitigation measures: (a) the upgrading of the existing computerized information system to record the project’s transactions and prepare Quarterly Interim Unaudited Financial Reports; (b) the amendment of existing administrative and financial procedures’ manual to integrate this project and (iii) the recruitment of an external auditor.
10. FM Conditions and FM covenants for the Cellule BM-BAD
a) the amendment of existing administrative and financial procedures’ manual to integrate this project;
b) the upgrading of existing computerized information system no later than 2 months after effectiveness; and
c) the recruitment of an external auditor no later than 6 months after effectiveness, 11. Country PFM situation. Following 2006 PEMFAR and 2007 PEFA that identified several weaknesses in Cameroon’s Public Financial system (Budget credibility, comprehensiveness and transparency, policy-based budgeting, budget execution, accounting and reporting, auditing and external scrutiny), the country has been embarked in a comprehensive reform to improve budget transparency and efficiency which resulted in the elaboration of the Nouveau Régime Financier de l’Etat (2007) and a public financial management modernization plan covering 2009-2015 period (PMFP). The GoC is also introducing program budgeting in the
36
2013 budget year as part of the reforms. The public financial management modernization plan is composed of seven strategic pillars (planning, budget execution-revenue, donors financing, budget execution-expenses, accounting, cash and debt management and internal and external control) which are achieved through the implementation of 170 actions, under the leadership of a dedicated high level Committee (Comité de Pilotage des Réformes des Finances Publiques). 12. Following the independent midterm review of PMFP, it stands out that 18 percent of the actions were implemented, about 37 percent are ongoing and the remaining 45 percent are lagging behind. The review has pointed out the need to undertake a use of country system assessment to determine modalities that could be used for the donors financed projects. Once such assessment is completed, the Bank will analyse the existing opportunities to retrofit on the entire portfolio. 13. The overall residual risk rating is Moderate. The assessment recommends the following mitigation measures: (a) the upgrading of the existing computerized information system to record the project’s transactions and prepare Quarterly Interim Unaudited Financial Reports whose format was agreed on during negotiations; (b) the amendment of existing administrative and financial procedures’ manual to integrate this project: and (c) the recruitment of technical audit firm.
Table 3.1: Risk Mitigation Measures
Risk Risk Mitigating Measures Incorporated into Project Design
Residual Risk/ (Risk) rating
Preparation /Implementation
Inherent risk High
Country level
Delay in the implementation of the PFM master plan could hamper the governance.
Implement PFM reform agenda with the support of World Bank and others donors (AfDB and EU).
High
Entity level
No particular risk
Rely on ‘Cellule BAD Banque Mondiale’
Moderate Implementation
Project level
37
Risk Risk Mitigating Measures Incorporated into Project Design
Residual Risk/ (Risk) rating
Preparation /Implementation
No particular risk Rely on ‘Cellule BAD Banque Mondiale’ Substantial Implementation
Control Risk Substantial
Budgeting
Delay in preparing yearly budget and inappropriate monitoring of budget execution resulting in delay in achieving project’s objectives.
Follow strictly budget procedures and timeline as per administrative and financial manual of procedures.
Ensure that the annual work program is in line with the procurement plan to prevent any delay due to the procurement process (mainly for the rehabilitation component).
Track budget variances and take proactive decisions.
Moderate Implementation
Implementation
Implementation
Accounting
Delay in preparing IFRs
Rely on existing accounting system
Update the existing accounting software
Moderate
Implementation
Internal Controls and Internal audit
unsuitable manual of procedures
Update existing administrative and financial manual of procedures as part of project implementation manual
Moderate Implementation
Funds Flow
Delay in funds transfer to beneficiaries
Open a Designated Account in acceptable commercial bank into which funds will be deposited.
Substantial
Preparation/Implementation
Financial Reporting and Update existing accounting software to handle the project’s transactions and generate the
Substantial Implementation
38
Risk Risk Mitigating Measures Incorporated into Project Design
Residual Risk/ (Risk) rating
Preparation /Implementation
Monitoring
Lack of adequate accounting software that could delay the submission of agreed IFRs and annual project financial statements
required financial information.
Preparation
External Auditing
Inadequate audit opinion by SAI and delay in submitting audit report by SAI
Recruit an external auditor Low Implementation
TORs has been amended
Fraud & Corruption
Risk of fraud & corruption in the contracts management
Ex post controls: financial internal audit and external audit, and integrated fiduciary review will be performed.
Ex ante controls: Third party verification will be performed
Involve Performance monitoring agents from the Ministry line
Substantial
Implementation
The overall residual risk rating is Moderate. 14. Strengths. The Cellule BM-BAD and CAMRAIL have been managing adequately ongoing Regional Transport Project (P079736) co-financed by AfDB and World Bank. The Cellule is endowed with one Finance Officer, two (2) accountants, one Internal Auditor, an administrative and financial manual of procedures, and accounting software. Camrail is endowed with one Financial manager, one accountant and a robust internal control system. All staff is familiar with donors funded project procedures (Word Bank and AfDB). There is no overdue audit report to date and the external auditor opinion on last financial audit report is unqualified.
39
Table 3.2: Key weaknesses and Action Plan to reinforce the control environment
Significant Weaknesses or risks Actions Responsible Completion
Amend the project manual of the procedures and, Update the existing computerized information system Recruit an external auditor
Cellule BAD BM
Cellule BAD BM
Cellule BAD BM
Effectiveness
2 months after effectiveness
6 months after effectiveness
15. Staffing. One Finance officer and 2 accountants of Cellule BAD Banque mondiale will ensure the financial management of the project. All these staff are familiar with donors funded projects procedures (World Bank and AfDB).Their role and responsibility will include: (a) preparation of Withdrawal applications; (b) preparation of periodic financial reports and annual financial statements; (c) bookkeeping; and (d) project’s assets safeguard. 16. Budgeting. The overall responsibility for preparing a consolidated annual work plan and budget will lie with Cellule BAD Banque mondiale. This will be done in line with the program based budget currently enforce in Cameroon. The different steps of budget management (preparation, revision, adoption, and execution) are detailed in the Project Implementation Manual. The annual work plan and budget will be prepared yearly, submitted to the Bank for approval no later than the end of January (or one month after the Effective date for the first year of the project), and then approved by the Steering Committee. The annual work program will be in line with the procurement plan to prevent any delay due to the procurement process. A budget execution report will be included in a quarterly interim financial report to enable the project’s implementation to be monitored.
17. Accounting Arrangements and System. The fiduciary staff will have the overall responsibility for maintaining the accounts of the project activities and ensuring that the annual financial statements are produced in a timely manner and in accordance with the accounting standards that are in effect in Cameroon.25 Existing computerized accounting system will be upgraded to record the project’s transactions and to produce the required periodic reports.
18. Internal Control. The administrative, financial, and accounting procedures are defined in the administrative, accounting, and financial procedures manual. The manual includes a clear description of the initiation and approval processes with respect to segregation of duties.
19. Internal Audit. The current project’s internal auditor will perform risk-based audit and submit periodic reports on his or her findings and recommendations to strengthen the internal control system.
25 The accounting principles set out by L’Organisation pour l’Harmonisation en Afrique du Droit des Affaires–OHADA.
40
20. Flow of Funds. Two Designated Accounts (DA) in XAF (one for components managed by Cellule BAD-BM and one for component managed by CAMRAIL will be opened in a commercial Bank acceptable, Standard Chartered, to IDA and managed by the Caisse Autonome d’Amortissement. The ceiling for each DA will be set to the equivalent of a cash forecast for four months as follows: DA-A (Cellule BAD-BM) is XAF 2 billion and DA-B (Camrail) is XAF 500 million.
Fig 3.1: Flow of Funds for Component A and C
41
Fig 3.2: Flow of Funds for Component B
21. Financial Reporting and Monitoring. The country’s financial reports are not made available timely and are not compliant with IPSAS. The quarterly interim financial reports (IFRs) to be generated from the computerized financial management system will be presented in accordance with the format agreed with IDA and submitted to IDA within 45 days of the end of each calendar quarter by the Cellule BAD-BM and CAMRAIL. The IFRs will include: (a) sources and uses of funds; (b) a comparison of budgeted and actual project expenditures (commitment and disbursement) to date and for the quarter; (c) a statement of the use of funds by component or activity; (d) designated account activity; and (e) a physical progress report on the implementation of the project. 22. External Auditing. The TORs of existing external auditor have been amended to take into account this project. The annual financial statements and quarterly IFRs prepared by Cellule BAD BM and CAMRAIL as well as the internal control system will be subject to an annual audit by a reputable and independent auditing firm based on terms of reference that are satisfactory to IDA. The auditor will issue two different opinions on annual financial statements produced respectively by Cellule BAD BM and CAMRAIL and the ToRs of financial audit will be tailored accordingly. The scope of the audit will be tailored to the project’s specific risks in accordance with World Bank requirements and has been agreed upon with the government. In particular, the independent auditor will audit the use of all funds flowing from the designated account to the ultimate beneficiaries. The project will comply with the World Bank’s access to information and
42
disclosure policies by making all disclosable audit reports publicly available promptly after receiving them. A single audit opinion, in compliance with International Standards on Auditing, will be issued and will cover all project receipts, payments, and accounts. The audited financial statements, along with the auditor’s report and management letter (incorporating management’s comments) covering any identified internal control and accounting system weaknesses, will be submitted to IDA within six months of the end of each financial year. CONSUPE will be involved to perform a periodic control and the report will be made available to IDA. Finally, CAMRAIL will submit annually an audited financial report prepared by an acceptable external auditor to be recruited under ToRs satisfactory to the Bank. 23. Technical Audit and Third Party Verification. A firm will be recruited to ensure third party verification for road construction and rehabilitation. The terms of reference of these verifications will be detailed in the Project Implementation Manual.
Table 3.3: Financial Management Action Plan.
Action to be undertaken Time-frame Responsible
body 1. Update accounting, financial, and administrative manual of
procedures. Effectiveness Cellule BAD
BM
2. Update existing computerized information system for the financial management of the project’s activities.
2 months after effectiveness
Cellule BAD BM
3. Recruit an external financial auditor. 6 months after effectiveness
Cellule BAD BM
24. Conclusions of the FM Assessment. The overall residual FM risk is considered Moderate. The proposed financial management arrangements for this project are considered adequate and meet the Bank’s minimum fiduciary requirements under OP/BP10.00. 25. Implementation support Plan. FM implementation support intensity and frequency will be in line with risk-based approach, and will involve a collaborative approach with the entire Task Team. A first implementation support mission will be performed two months after the project effectiveness. Afterwards, the missions will be scheduled by using the risk based approach model and will include the following diligences: (a) monitoring of the financial management arrangements during the supervision process at intervals determined by the risk rating assigned to the overall FM Assessment at entry and subsequently during Implementation (ISR); (b) integrated fiduciary review on key contracts; (c) review the IFRs; (d) review the audit reports and management letters from the external auditors and follow-up on material accountability issues by engaging with the task team leader, Client, and/or Auditors; the quality of the audit (internal and external) is to be monitored closely to ensure that it covers all relevant aspects and provide enough confidence on the appropriate use of funds by recipients; and, (e) others assistance to build or maintain appropriate financial management capacity and efficient internal control system. FMS will participate in some field visits for physical verification.
26. Disbursement Arrangements: The IDA funds will be disbursed according to the World Bank Disbursement Guidelines and should be used to finance eligible project expenditures. For the
43
first year of implementation, the project will follow transaction based disbursements and will make use of the four disbursement methods (Advances26, Direct Payment, Reimbursement and Special Commitment) and the World Bank’s electronic submission of applications for withdrawal of financing proceeds (“eDisbursements”). Upon credit effectiveness and based on receipt of a Withdrawal Application signed by the authorized signatory, an initial advance up to the ceiling amount will be disbursed to each Designated Account. Subsequent advances to the DA will be made against submission of adequate supporting documentation (Records and/or Statement of Expenditures (SOEs) including DA reconciliation and bank statements) reporting eligible expenditures paid from the DA on a monthly basis. Detailed supporting documents should be retained by the project management. The minimum value of application for direct payment, reimbursement and special commitment is US$100,000. 27. Allocation of the Credit’s Proceeds. The table below sets out the expenditure categories to be financed out of the Credit. This table takes into account the prevailing Country Financing Parameter for Cameroon in setting out the financing levels.
Table 3.4: Allocation of Credit Proceeds
Category Amount Allocated (US$) Percentage of Expenditures to be Financed
(1) Works for Part A.1 of the Project 53 million
83% excluding V.A.T. and custom duties
(2) Goods, works, non-consulting services, consultants’ services, for Part B of the Project
9 million 100% excluding V.A.T.
(3) Goods, non-consulting services, consultants’ services, Training and Operating Costs for Parts A and C of the Project
9 million 100% excluding V.A.T. and
custom duties
Total 71 million
Procurement Guidelines 28. Procurement for the Project will be carried out in accordance with the World Bank “Guidelines: Procurement of Goods, Works, and Non-Consulting Services under International Bank for Reconstruction and Development (IBRD) Loans and IDA Credits & Grants by World Bank Borrowers” dated January, 2011; and “Guidelines: Selection and Employment of Consultants under IBRD Loans and IDA Credit & Grants by World Bank Borrowers”, dated 26 During project preparation, the advancing of financing proceeds into a designated account is not a Disbursement Method currently available under this Credit in application of subsection 5.2 of the Disbursement Guidelines. However, as the restriction is expected to be lifted during project implementation, arrangements for disbursements to Designated Accounts are described in this section while the DL will omit such arrangements.
44
January, 2011, and the provisions stipulated in the Legal Agreement. Procurement (works, goods and non-consulting services) or Consultant Selection methods, prequalification, estimated costs, prior review requirements, and time-frame are agreed in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual project implementation. The Bank’s Standard Bidding Documents (SBD) or Cameroon National Standard Bidding Documents satisfactory to the Association will be used. To the extent practicable the Bank’s Standard Bidding Documents for works, goods and Standard Requests for Proposals, as well as all standard evaluation forms, will be used throughout project implementation. 29. Advertising. A comprehensive General Procurement Notice (GPN) will be prepared by the Borrower and published in the United Nations Development Business online (UNDB online) to announce major consulting assignments and any international competitive bidding (ICB). The GPN shall include all ICB for works, goods and non-consulting services contracts and all large consulting contracts (i.e., those estimated to cost US$300,000 or more). In addition, a specific procurement notice is required for all works and goods to be procured under ICB in UNDB online. Requests for Expressions of Interest (EOI) for consulting services expected to cost more than US$300,000 shall be advertised in UNDB online. An EOI is required in the national gazette, a national newspaper, or an electronic portal of free access for all consulting firm services regardless of the contract amount. In the case of National Competitive Bidding (NCB), a specific procurement notice will be published in the national gazette, a national newspaper, or an electronic portal of free access. Contract awards will also be published in UNDB, in accordance with the Bank’s Procurement Guidelines (para. 2.60) and Consultants Guidelines (para. 2.31). 30. Requirements for National Competitive Bidding. Works, goods and non-consulting services contracts will use NCB procurement methods in accordance with national procedures using Standard Bidding Documents acceptable to the IBRD and subject to the additional requirements:
a) In accordance with paragraph 1.16 (e) of the Procurement Guidelines, each bidding document and contract financed out of the proceeds of the financing shall provide that (a) the bidders, suppliers, contractors and their subcontractors, agents, personnel, consultants, service providers, or suppliers shall permit the World Bank as Supervising Entity, at its request, to inspect all accounts, records and other documents relating to the submission of bids and contract performance, and to have said accounts and records audited by auditors appointed by the World Bank/Supervising Entity; and (b) the deliberate and material violation of such provision may amount to an obstructive practice as defined in paragraph 1.16 (a)(e) of the Procurement Guidelines:
b) Invitations to bid shall be advertised in national newspapers with wide circulation. c) The bid evaluation, qualification of bidders and contract award criteria shall be clearly
indicated in the bidding documents. d) Bidders shall be given adequate response time (at least four weeks) to submit bids from
the date of the invitation to bid or the date of availability of bidding documents, whichever is later.
e) Eligible bidders, including foreign bidders, shall be allowed to participate. f) No domestic preference shall be given to domestic contractors and to domestically
manufactured goods; and association with national firm shall not be a condition for
45
participation in a bidding process. g) Bids are awarded to the substantially responsive and the lowest evaluated bidder proven
this bidder is qualified. No scoring system shall be allowed for the evaluation of bids, and no “blanket” limitation to the number of lots which can be awarded to a bidder shall apply.
h) Qualification criteria shall only concern the bidder’s capability and resources to perform the contract taking into account objective and measurable factors.
i) Fees charged for the bidding documents shall be reasonable and reflect only the cost of their printing and delivery to prospective bidders, and shall not be so high as to discourage qualified bidders.
31. Procurement Environment. Recent changes in the Cameroon legislation have modified the institutional architecture of the bodies responsible for public procurement in the country. The new organizational structure was introduced through three decrees issued on 8 March, 2012, and recently on August 5, 2013. No special exceptions, permits or licenses need to be specified in the Financing Agreement since the procurement code, approved by the President of the Republic in September, 2004 allows International Development Association (IDA) procedures to take precedence over any contrary provisions in local regulations. 32. Procurement arrangements for Bank-financed projects in Cameroon have been under discussion for some time as the national system has been revised to shift responsibility for the bulk of procurement and contract management from decentralized agencies to a newly created MINMAP. IDA fielded a procurement mission between October 31 and November 10, 2012 to assess the potential effects of these changes and notably the possible consequences on Bank-financed projects in Cameroon. The mission concluded that the new centralized system could lead to a number of positive outcomes.
33. However, concerns were raised with respect to technical and legal responsibilities as well as regulatory issues. This mission was followed by another one conducted jointly with other Development Partners based in Cameroon during the period of January 28 to February 3, 2013, in order to: (a) discuss the recommendations of the initial mission; (b) facilitate the transition from the old to the new procurement system; and (c) ensure the smooth implementation of the Bank financed projects. MINMAP has confirmed in writing to the Bank that it accepts the proposed short term measures of the donors concerning existing projects as identified in the documents of negotiations and the legal agreements, which consist of the creation of special tender boards with full procurement responsibility and the Program Coordination Unit (‘’Maître d’Ouvrage’’) in charge of the publication of tenders, contracts award and signature of all contracts. For these existing projects, the national prior review will be now conducted by MINMAP as the previous body in charge of this review was dissolved. For new projects, such as this one, the Bank is willing to accept the national systems as proposed by MINMAP, however, with the expectation that MINMAP will take all the steps needed to ensure smooth implementation, such as:
a) The central tender boards in MINMAP will handle procurement under Bank projects with specialists that are knowledgeable of Bank procurement policy.
46
b) Close monitoring by MINMAP of the project implementation and monthly reporting on the advancement in procurement and contract implementation.
c) Periodical meetings with the World Bank Country Office in Yaoundé to discuss
procurement related portfolio performance issues. 34. Specific procurement arrangements for this project. In light of the above missions, the government will amend the mandate of the existing special tender board (CSPM) of Cellule MINTP BM BAD/ CEMAC TTF project, or will create a new Special Tender Board (Commission Spéciale de Passation des Marchés Publics, CSPM) within the implementing entity. The legal text of the amendment or creation will be acceptable to IDA and reflect the agreement between the government and the Bank on the constitution, composition, competencies of the CSPM under this project. It is recommended that the legal text be issued by the government prior to the beginning of any procurement activity below MINMAP contracting authority thresholds. 35. Procurement of Works. Procurement of Works under this project consists mainly of the full rehabilitation of the Maroua-Mora section (61km), and the rehabilitation of selected bridges on the railway network which have reached the end of the life span and need urgent interventions. Civil works costing more than US$5,000,000 equivalent will be procured through ICB. Other works contracts costing less than US$5,000,000 equivalent will use NCB procurement methods in accordance with national procedures using Standard Bidding Document acceptable to IDA and subject to the additional requirements set forth or referred to above in the paragraph above mentioned ‘’Requirements for National Competitive Bidding’’ of the current annex. Small works estimated to cost less than US$200,000 equivalent per contract may be procured through shopping, based on price quotation obtained from at least three contractors in response to a written invitation to qualified contractors.
36. Performance Based procurement will be applied to the road maintenance for a defined period of years. It will consist of a type of performance-based contract and will be combined with the procurement of Works for the rehabilitation of Maroua-Mora road section.
37. Procurement of Goods and Non Consulting Services. Procurement of Goods under this project will include mainly railway signaling equipment and mechanized switch points for the rail sub-component. Taking into account the level of value added, and manufacturing/production capacity in the country, procurement of goods will be bulked where feasible (of similar nature and need at same time period) into bid packages of at least US$1 million equivalent, so that they can be procured through suitable methods to secure competitive prices. Goods estimated to cost US$1 million equivalent and above per contract will be procured through ICB, which will use the Bank’s Standard Bidding Documents. For other goods contracts costing less than US$1 million equivalent, NCB procurement methods will be used in accordance with national procedures using Standard Bidding Document acceptable to Word Bank and subject to the additional requirements set forth or referred to above in paragraph on Requirements for National Competitive Bidding:
a) Procurement of goods and non-consulting services, including those of readily available
47
off-the-shelf maintenance of the office electronic equipment and other services such as printing, and editing, which cannot be grouped into bid packages of US$100,000 or more, may be procured through prudent shopping in conformity with Clause 3.5 of the procurement guidelines.
b) Based on country-specific needs and circumstances, shopping thresholds for the
purchase of vehicles and fuel may be increased up to US$500,000, considering the major car dealers and oil providers are consulted.
c) At the beginning of the project, vehicles procurement packages estimated to cost
US$200,000 or less can be procured through UNOPS or other United Nations agencies. 38. Selection of Consultants. Consulting services will be used for the following activities: (a) financial audit; (b) technical assistance for the right business climate for competitive transport market; (c) independent monitoring system of transport prices and cost and trends in Cameroon; (d) integrated environmental and social strategic assessment for the transport sector; (e) elaborating an integrated intermodal transport infrastructure sector strategy in light of the country’s Growth and Employment Strategy and Vision 2035; and (f) supervision of the rehabilitation of Maroua Mora Section. These consulting services will be procured with the most appropriate method among the following which are allowed by Bank guidelines and included in the approved procurement plan: Quality-and Cost-Based Selection (QCBS), Quality-Based Selection (QBS), Selection under a Fixed Budget (SFB), Least-Cost Selection (LCS):
(i) Selection based on Consultants’ Qualifications (CQS) will be used for assignments that shall not exceed US$300,000. Single Source selection shall also be used in accordance with the provisions of paragraphs 3.9 to 3.13 of the Consultant Guidelines, with World Bank’s prior agreement. All terms of reference will be subject to World Bank Prior Review.
(ii) Assignments of Engineering Designs & Contract Supervision in excess of US$300,000,
and all other technical Assistance assignments above US$100,000, must be procured on the basis of international short-lists and in accordance with the provisions of the paragraph 2.6 of the consultants’ guidelines.
(iii) Consultants for services meeting the requirements of Section V of the consultant guidelines will be selected under the provisions for the Selection of Individual Consultants, through comparison of qualifications among candidates expressing interest in the assignment or approached directly.
39. Operating Costs financed by the project include, inter alia, utilities and offices supplies, vehicle operation, maintenance and insurance, building and equipment maintenance costs. They will be procured using the project’s financial and administrative procedures included in the operation manual and based on the annual work plan and budget. For services (car maintenance, computers maintenance, etc.) to be financed through operating costs, the project will proceed by service contracting for a defined period.
48
40. Trainings, Workshops, Seminars, Conferences and Study Tours will be carried out on the basis of approved annual work plan and budget that will identify the general framework of training and similar activities for the year, including the nature of training, study tours, workshops, the number of participants, and cost estimates.
C. Institutional arrangements for procurement and capacity assessment including risk
mitigation measures
41. Procurement Implementation Arrangements for components A and C by the Cellule BM-BAD within MINTP and with the involvement of MINMAP for high value contracts. MINTP and MINMAP will share the procurement responsibilities depending on the value of the contracts and their responsibilities will be in line with the requirements of the national procurement legislation. 42. Procurement capacity assessment of the implementation arrangements for components A and C by the Cellule BM-BAD within MINTP, with the involvement of MINMAP for high value contracts. An assessment of the cellule MINTP BM-BAD and MINMAP was carried out on December 12, 2013. The capacity assessment found that: (a) at present there is no qualified procurement specialist within the cellule, but a recruitment process is underway; (b) the operational manual including a section on procurement will need to be updated; and (c) while the motivation of the reform related to the new institutional arrangements of December, 2011 with the responsibilities of MINMAP is understood, some aspects of the new institutional arrangements raise the concerns with respect to technical and legal responsibility and related regulatory issues.
43. The procurement risk at the time of assessment is high. To mitigate the above-mentioned procurement risks, an action plan has been agreed. Implementation and monitoring of the mitigation action plan in the table 3.5 below will reduce the procurement residual risk to Substantial.
Table 3.5: Procurement Action Plan
Action to be undertaken Timeframe Responsible body
Elaboration and submission of a procurement plan to the World Bank
First draft at pre-appraisal and final version discussed during negotiations
Cellule MINTP BM BAD
Finalize and submit to IDA for agreement, a satisfactorily version of the operations manual comprising a section on procurement for use by the project
First draft presented at negotiations and adoption upon project effectiveness
Cellule MINTP BM BAD
Recruit and maintain a Procurement Specialist with qualification and expertise satisfactory to the Bank within the Cellule MINTP BM BAD
Selection completed by project negotiations
Cellule MINTP BM BAD
Recommendation for the amendment of the Before the beginning of Cellule MINTP BM
49
Action to be undertaken Timeframe Responsible body
special tender board (CSPM) of Cellule MINTP BM BAD/ CEMAC TTF project, or the creation of a new CSPM within the implementing entity and attached to the project to supervise project procurement, which is acceptable to the Bank.
any procurement activity below MINMAP contracting authority thresholds
BAD /MINMAP
Mandatory submission to the Bank of the feedbacks of the Regulatory Body for Public Procurement (Autorité de régulation des Marchés Publics, ARMP) on the complaints of all contracts directly handled by MINMAP, and Bank No-objection on complaint decisions of the said contracts.
as needed during project life
Cellule MINTP BM BAD / MINMAP
MINMAP shall comply with Procurement Services Standard time of the procurement code
as needed during project life
Cellule MINTP BM BAD / MINMAP
44. The Cellule MINTP BM BAD as the key implementing entity and MINMAP as the contracting authority for high value contracts will be responsible for compliance with relevant procurement procedures. The implementing entity is responsible for ensuring that the necessary national clearances and approvals have been received before the no-objection requests are transmitted to the Association. Procurement of contracts costing FCFA 5 million (US$10,000 equivalent) or more depending on their amounts will be conducted either by MINMAP through their central tender boards or by the implementing entity with the technical support of their project special tender if these contracts are below MINMAP contracting authority thresholds amounts. For contract amounts of less than FCFA 5 million (US$10,000 equivalent), the implementing entity will rely on an internal procurement committee. Details of the institutional arrangement and the responsibility of this internal procurement committee will be provided in the operations manual. 45. Procurement Implementation Arrangement of component B related to rail infrastructure improvement by CAMRAIL. CAMRAIL will be in charge of implementing Component B. The overall procurement responsibility for implementation of these activities will be with CAMRAIL.
46. Procurement capacity assessment of the Implementation Arrangements of Component B by CAMRAIL. An assessment of the capacity of CAMRAIL for the purpose of the project was carried out on December 12, 2013, and the procurement risk for the implementation of this component is rated as Moderate, because: (a) the Procurement Specialist currently on board is qualified, but needs to be maintained to work on this new project; (b) the Procedural Manual needs to be updated.
50
47. The procurement risk rating is moderate. To mitigate the above-mentioned procurement risks, an action plan has been agreed upon. Implementation and monitoring of the mitigation action plan in the table 3.6 below will reduce the procurement residual risk to Low.
Table 3.6: Procurement Action Plan
Action to be undertaken Timeframe Responsible body
Elaboration and submission a procurement plan to the World Bank
Final version was agreed upon during negotiations
CAMRAIL
Finalize and submit to World Bank for agreement, a satisfactory version of the operations manual comprising a section on procurement for use by the project
First draft at negotiations
CAMRAIL
Confirm in his current position the procurement specialist of the current World Bank project
Done by negotiations CAMRAIL
48. Overall project procurement risks. The overall procurement risk for the project is rated as High. This is due to, among other factors, the country environment risk of corruption in procurement, especially in public contracts, the relatively limited experience in the implementation of Bank-financed projects for MINMAP, and the potential conflict of interest for MINMAP in relation to the management of complaints linked to contracts directly handled by MINMAP. Mitigation action plans have been agreed upon, which, if properly implemented and monitored, will bring this risk down to Substantial. 49. Procurement Plan. A first Simplified Procurement Plan provides the basis for the procurement methods, and covers the first 18 months of project implementation. The final version of this procurement plan was discussed and agreed upon by the Recipient and the project team at negotiations. It will be available in the project’s database and a summary will be disclosed on the Bank’s external website once the project is approved by the Board. The Procurement Plan will be updated in agreement with the Project Team annually or as required to reflect the actual project implementation needs and improvement in institutional capacity.
50. Publication of Results and Debriefing. Publication of results of the bidding process is required for all ICBs, Limited International Biddings (LIBs), and Direct Contracting. Publication should take place as soon as the no-objection is received, except for Direct Contracting which may be done quarterly and in a simplified format. Publication of results for NCB and Shopping should follow the requirements of the procurement code of Cameroon. The disclosure of results is also required for selection of consultants. All consultants competing for the assignment should be informed of the result of the technical evaluation (number of points that each firm received) before the opening of the financial proposals, and at the end of the selection process the results should be published. The publication of results in selection of consultants applies to all methods. For CQS and SSS, however, the publication may be done quarterly and in a simplified format. The publication of results may be done through Client Connection. Losing bidders/consultants
51
shall be debriefed on the reasons why they were not awarded the contract if they request explanation. 51. Fraud and Corruption. The procuring entity as well as Bidders /Suppliers/Contractors /Services Providers shall observe the highest standard of ethics during the procurement and execution of contracts financed under the program in accordance with paragraphs 1.14 and 1.15 of the Procurement Guidelines and paragraphs 1.22 and 1.23 of the Consultants Guidelines. The Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants”, dated October 15, 2006, and revised in January, 2011, will apply to this project.
52. Frequency of Procurement Supervision. The capacity assessment of the implementing agency has recommended supervision missions to visit the field at least twice a year and a post review of procurement actions will be conducted on an annual basis. 53. Summarized Procurement Plan. The main works, goods and non-consulting services to be procured in the project are listed in Table 3.7 below.
Table 3.7: List of Works, Goods and Non-Consulting Services Contract Packages to be
procured
Ref. No.
Description Estimated Cost
(US$ million)
ProcurementMethod
Domestic Preference
(yes/no)
Review by World Bank (Prior/Post)
Comments/Completion
date 1 Rehabilitation of the
Road Maroua-Mora and maintenance works under a PBC
73 ICB NO Prior December
2019
2 Mechanization of switch points (Yde-Kousseri) and modernization of the signaling system
3.0 ICB No Prior December
2015
3 Acquisition of safety lights, warning systems and gates for railroad crossings
0.4 ICB No Prior November
2015/Very few local suppliers
4 Rehabilitation of selected bridges for urgent intervention
0.725 NCB No Post December
2016
54. Prior review thresholds for Works, Goods and Non-consultant services. Contracts estimated to cost above US$5 million for works and US$500,000 for goods per contract, the first NCB contracts for works and goods, eventually others as identified in the procurement plan and all Direct Contracting will be subject to prior review by the World Bank. 55. The main consulting assignments of the project are listed in the Table below.
52
Table 3.8: List of Consulting Assignments with Selection Methods and Time Schedule
Ref. No.
Description of Assignment
Estimated Cost
(US$ million)
SelectionMethod
Review by World Bank (Prior / Post)
Comments/ Completion
date 1 Supervision of the
rehabilitation road Maroua-Mora and maintenance works
3.200 QCBS Prior December 2019
2 Feasibility study for the Rail-Road logistic Platform in Ngaoundere
0.207 QCBS Prior September 2015
56. Prior review thresholds for consultant services. Consultant services estimated to cost above US$200,000 for firms and US$100,000 for individuals per contract, and Single Source selection of consultants (firms and individuals) will be subject to prior review by the World Bank. Similarly, all audit contracts will be subject to prior review, as will be the first contracts to be awarded in accordance with each selection method of consulting firms and individual consultants, regardless of contract amount. Short Lists of Consultants for Assignments of Engineering Designs & Contract Supervisions estimated to cost less than US$300,000 and all other Consultancy Assignments whose estimated cost don’t exceed US$100,000 per contract may be composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. D. Environmental and Social (including safeguards) 57. Appropriate environmental and social management of the Cameroon Multimodal Transport Project is not only critical to long-term sustainability, but also increases the project’s profitability by anticipating potential problems and avoiding ex-post mitigating measures, always costlier than prevention. Further, the impact of the project on economic and social development in Cameroon is also enhanced by the proper management of social and environmental issues and challenges. 58. Regulatory Context. Cameroon has an established institutional and regulatory framework for the management of environmental assessments (EAs). All large projects, such as roads, are subjected to EAs that must be reviewed by the Inter-Ministerial Committee on the Environment and can be subjected to public hearings. Once validated by the Inter-Ministerial Committee on the Environment, a certificate of compliance is issued by the Minister of Environment, Nature Protection and Sustainable Development. This EA process has been operational since 2005. The New EA Decree was published in February 2013. The regulatory frame work seems complete now in Cameroon. It is important to notice that some weaknesses in terms of the technical capacity of the inter-ministerial committee to review complex EAs and to monitor the implementation of their Environmental Management Plans (EMPs) are remaining.
53
Annex 4: Operational Risk Assessment Framework (ORAF)
Cameroon: Cameroon - Multimodal Transport Project (P143801)
.
Project Stakeholder Risks
Stakeholder Risk Rating Substantial
Risk Description: Risk Management:
Political risk: Instability in neighboring countries, especially in the Central African Republic and North-East Nigeria. Opposition to reforms: In Cameroon and generally CEMAC region, the transit system is characterized by numerous inefficiencies due to vested interests and monopolistic behaviors. Several key actors have no interest in seeing things change and in greater competition and/or transparency. Government’s failure to meet its obligations to secure the right level of funding to ensure sustainable maintenance: Road maintenance works are often poorly planned and executed, presenting a risk for the protection and useful life of the roads recently constructed or rehabilitated. Earmarked funds from gasoline charge may cover the overall road maintenance needs, if they were entirely dedicated to that end (resources collected are above XAF Billion 55, and should be entirely transferred to RMF, which did not happen in 2012), and properly utilized.
Close monitoring of on the ground situation in coordination with Country Office and other UN agencies. All works are located in Cameroon and won’t be affected by the situation in CAR. Identify and support trade facilitation champions (such as the Cameroon customs). Protect key infrastructure investments from political interferences through sector policy dialogue and close monitoring. A sector dialogue is ongoing to launch pilot PBCs to maintain the rehabilitated road section. Institutional support has been envisaged to help improve road planning and maintenance schemes. Maintain a close dialogue equally with all stakeholders associated with road maintenance so as to understand concerns but also to remind them of the rationale behind an efficient road maintenance scheme.
Resp: Status: Stage: Recurrent: Due Date: Frequency:
WB In Progress Both Quarterly
Implementing Agency (IA) Risks (including Fiduciary Risks)
Capacity Rating High
Risk Description: Risk Management:
Lack of fiduciary capacity: Procurement and financial The main implementing agency in Cameroon (Ministry of Public Works) will be
54
management staff may become overwhelmed by the multiplicity of activities and beneficiary institutions involved. Long procurement processes and risk of institutional duplication: the Ministry of Public Procurement Affairs is presenting a serious risk of missions overlapping and/or conflicting with the projects implementing institutions and agencies, which may cause important supplementary delays to projects execution.
strengthened so that it can absorb the additional workload. Fiduciary staffs have received several training in Bank procedures. Dialogue with the Government is going on to clarify and simplify the procurement processes under the new environment, in respect with the agreements and conventions signed with the development partners.
Resp: Status: Stage: Recurrent: Due Date: Frequency:
Client In Progress Both Continuous
Governance Rating High
Risk Description: Risk Management:
The implementation of project activities may be affected by governance issues, particularly for large-scale infrastructure works.
Increased supervision and reporting through ex-post fiduciary reviews, internal and external auditing and bi-yearly governance reporting.
Resp: Status: Stage: Recurrent: Due Date: Frequency:
WB Not Yet Due Implementation SemiAnnual
Risk Management:
Close monitoring of all procurement processes through ex-ante reviews (by the Bank team, the Regional Procurement Advisor’s office or the OPRC committee for the largest contracts), ex-post reviews for the smallest contracts, internal and external auditing and governance reporting. Training and institutional strengthening of fiduciary staff and procurement committees.
Resp: Status: Stage: Recurrent: Due Date: Frequency:
WB Not Yet Due Implementation Continuous
Project Risks
Design Rating Substantial
Risk Description: Risk Management:
Funding for road maintenance:The sustainability of road investments may be reduced due to the unavailability of funds for road maintenance or poor programming of
The credit agreement will include a covenant so that the Road Maintenance Fund budget includes resources to maintain the road sections rehabilitated under the project. An active dialogue has been initiated by the key donors that are active in the road sector in
55
maintenance resources. High construction costs and delays: Overruns result in unfunded activities, delays in the execution of works, non-compliant contractors. Lack of experience with PBCs.
order to support the planning of road maintenance activities and improve the efficiency of maintenance contracts and funding mechanism. Furthermore, the decision by the Ministry of Finance to soon increase the RMF allocation to XAF70 billion is an encouraging sign. Close supervision of road contracts, in particular to ensure that road designs are adequate. The proposed financing includes an “unallocated” provision to protect against possible overruns. The presence in country of competent firms in the sector will create competition and hence favorably affect cost. A wide dissemination of the procurement notice through national and international media, including online procurement websites (UNDB, DG market) will attract more professional companies, ensuring more competition Several mitigation measures are in place: (a) the supervision consultant will do a final review of the detailed design before the works start, (b) the supervision of the contract will be reinforced through the hiring of a third party technical auditor, in addition to the usual monitoring consultants, (c) the PIU will use a road contract Performance Assessment Tool successfully disseminated and tested in several client countries, and (d) a study tour was organized for the PIU in Chad, where PBCs have already been tested.
Resp: Status: Stage: Recurrent: Due Date: Frequency:
Both In Progress Both Yearly
Social and Environmental Rating Low
Risk Description: Risk Management:
Social and environmental issues may affect the implementation or the effectiveness of the infrastructure works.
Training of project staff and institutional strengthening of environmental units in Ministries of Public Works. Intensified safeguards supervision and preparation of specific action plans with construction firms whenever needed. Close coordination with the other donors on safeguards monitoring and enforcement.
Resp: Status: Stage: Recurrent: Due Date: Frequency:
Both Not Yet Due Implementation Continuous
Program and Donor Rating Moderate
Risk Description: Risk Management:
56
Counterpart funds: The implementation of some project activities in the road subsector are affected by the lack of national counterpart funds.
In the road sector, national counterpart funds are generally needed to cover eventual overruns which have so far not materialized. A close dialogue and monitoring on the annual budget preparation process will be established in order to make sure that sufficient counterpart funds are adequately budgeted.
Resp: Status: Stage: Recurrent: Due Date: Frequency:
WB In Progress Both Yearly
Delivery Monitoring and Sustainability Rating Low
Risk Description: Risk Management:
The impact of project activities cannot be properly assessed because of the lack of data collection and of limited analytical capacity in the transport departments coordinating the project.
M&E Specialist will be recruited.
Resp: Status: Stage: Recurrent: Due Date: Frequency:
Both In Progress Both 30-Nov-2014
Overall Risk
Overall Implementation Risk: Rating High
Risk Description:
Overall risk rating for implementation is rated “High” because road works may be slow to execute based on the experience of past infrastructure works in Cameroon. However, the simplicity of the road infrastructure component of the proposed financing is expected to ease implementation.
57
Annex 5: Implementation Support Plan
CAMEROON: Multimodal Transport Project
Strategy and Approach for Implementation Support
1. The Implementation Support Plan (ISP) describes how the International Development Association (IDA) will support the implementation of the risk mitigation measures (identified in the Operational Risk Assessment Framework, ORAF) and provide the technical advice necessary to facilitate achieving the Project Development Objectives (PDO) (linked to results/outcomes identified in the result framework). The ISP also identifies the minimum requirements to meet the Bank’s fiduciary obligations. Its content is as follows: 2. Implementation support plan. The project implementation strategy will be based on the following: (a) ensuring a high degree of quality at entry and implementation readiness of all project components; (b) focused technical, financial and procurement reviews both by Bank task teams and Bank-hired consultants; and (c) close and continuous follow-up on issues highlighted during implementation support missions. In order to put in place a continuous implementation support strategy, especially during the first two years of project implementation, the supervision effort will focus on efficiently and effectively implementing the procurement activities. 3. Team composition. The core implementation support team will consist of one international staff, experienced Task Team Leader (TTL) assisted by one transport specialist specialized in highway engineering, and one Cameroon Country Office based staff as co-TTL: in addition to this core supervision team, a trade facilitation specialist, a road safety specialist, fiduciary staff (procurement and financial management), as well as social and environmental staff will participate as full team members and be responsible for the implementation of project specific activities in their areas of expertise. The environmental and social specialists following the project will closely monitor the execution of the mitigation measures and safeguards documents. 4. Financial Management. Supervision will focus on the review of the project’s financial management system, including accounting, reporting and internal controls. The objective of the above implementation support plan is to ensure the project maintains satisfactory financial management systems throughout the project’s life. Based on the outcome of the financial management risk assessment, the following implementation support plan is proposed:
58
Table 5.1: Financial Management
FM Activity Frequency Desk reviews Interim financial reports review Quarterly Audit report review of the program Annually On site visits Monitoring of actions taken on issues highlighted in
audit reports, auditors’ management letters, internal audit and other reports
As needed
Transaction reviews (if needed) As needed Capacity building support FM training sessions Before Project starts and
thereafter as needed 5. Procurement. Based on the assessment of the capacity of the PIU carried out in December 2013, the following corrective measures that have been agreed upon: (a) close teamwork between the Cellule and the Ministry of Public Procurement should be maintained and in case of unavailability or overload of the Cellule Specialist who ensures procurement quality control in the actual scheme, the Cellule should ensure that provisions are made available for alternative solutions including the possibility to engage a qualified procurement specialist to ensure this quality control; and (b) the Cellule and the Ministry of Public Procurement respective teams will benefit from specific procurement and contract management trainings so as to ensure a rapid and smooth implementation of the project, including new contracts and new types of contracts. 6. Frequency of Procurement Supervision. In addition to the prior review supervision to be carried out from Bank offices, the capacity assessment of the Implementing Agency has recommended one field supervision mission every six (6) months. During one of the supervision missions, a Procurement Post-Review (PPR) will be done to carry out post review of procurement actions. 7. Environmental and Social. The project task team members responsible for environmental and social safeguards based in Yaounde and Abidjan will join supervision missions to monitor safeguards instruments preparation and implementation processes. 8. Results Monitoring and Evaluation. The collection of the data required for the monitoring and evaluation of the project will be under the responsibility of the Cellule and of CAMRAIL. Most of the indicators will derive directly from the road database, managed by the Ministry of Public Works, or from the data regularly collected and monitored by the rail concessionaire.
9. Frequency of implementation support effort. There will be at least two full-blown implementation review missions per year. Since part of the team is based in Yaoundé, additional missions will be fielded to deal with specific issues as required and in a timely manner, especially during the first two years of project implementation.
59
10. Implementation support budget. To ensure a strong and continuous implementation support effort, a minimum of US$132,000 per year implementation support budget for implementation of the project would be required to cover all related fixed and variable costs. Table 5-2 provides the breakdown of the implementation support budget for the project.
Table 5.2: Estimated Supervision Budget (Core Task Team) (First 36 months of project implementation)
Team member by skill mix
Fixed costs (US$)
Variable Costs (US$)
Number of Staff weeks
Number of trips
Washington (or other than Cameroon country office in Africa) -based Task Team Leader
22,500 8,000 5 2
Yaounde Country Office-based Transport Specialist
15,000 6,000 6 4
Washington -based Highway Engineer
12,000 8,000 3 2
Yaounde based Road Safety Specialist
5,000 1,500 2 1
Washington (or other than Cameroon country office in Africa) -based Trade Facilitation Specialist
12,000 8,000 3 2
Yaounde Country Office-based Procurement Specialist
7,500 1,500 3 1
Yaounde Country Office-based FM specialist
5,000 1,500 2 1
Yaounde Country Office-based Environmental specialist
5,000 3,000 2 2
Yaounde Country Office-based Social specialist
7,500 3,000 3 2
Total 91,500 40,500 29 17 NB: Variable Costs for HQ-based staff and fiduciary staff have been estimated based on the assumption that travel costs will be shared between a minimum of two projects.
60
Annex 6: Appraisal Summary- Economic analysis
CAMEROON: Multimodal Transport Project
I. Road
1. The proposed investment aims at rehabilitating and preserving existing assets. The overall objective of the Government, to which this credit contributes, is to rehabilitate, in a phased manner, the entire road corridor between Douala and N’Djamena, building on previous operations, such as the IDA-funded CEMAC TTTF Project, and also to introduce cost-efficient maintenance practices to avoid a piecemeal, firefighting approach which proves much more expensive over the long run. 2. It is anticipated that the improvement of the main road corridor between Chad and Cameroon will have a positive impact on the economy of both countries and, more specifically as far as the Maroua– Mora section is concerned, in the Northern regions of Cameroon, i.e. the poorest of the country. The rehabilitation of this section, together with the ongoing or recent rehabilitation of other parts of the corridor will strengthen economic ties between the Far North, the North and the rest of Cameroon. A traffic rupture along this road will naturally limit the regular flow of transit goods and may result to a social, economic or political crises/unrest caused by the eventual price increase on consumer goods; during the rainy season, when that section is barely passable, part of the traffic to N’Djamena is diverted on a longer itinerary via Chad, which gives a foretaste of what would happen soon if this section is not rehabilitated. The improved road infrastructure also serves as the main arterial of the region. Failure to implement the Project would most likely jeopardize exchanges in the Northern part of the country as well as most of Chad imports and exports. In addition, putting in place this cost-efficient system of maintenance will: (a) reduce investment costs in the future; and (b) make sure that roads are kept in a good condition all the time, which will keep transport costs low. 3. In this analysis, the main economic benefits of the rehabilitation of the Maroua – Mora road section of the Douala N’Djamena corridor are the reduction in road user costs, composed of vehicle operating costs and travel time costs, due to the improved road condition.
4. A traffic rupture along this road would automatically limit the regular flow of transit goods and may result in a social, economic or political crises/unrest caused by the eventual price increase on consumer goods. The estimated rehabilitation cost is US$66 million, including parallel complementary activities and supervision. 5. Traffic levels on the whole corridor vary significantly across the sections, reflecting in particular the transport choices of transit actors (between Douala, Yaoundé and Ngaoundéré, the northern end of the railway network, about 39 percent of the traffic is captured by rail transport). Between Douala and Yaoundé, Cameroon’s two main cities, traffic levels range between 4,000 and 6,000 vehicles per day, about 25 percent of these are trucks. Overall traffic is expected to increase as a result of the on-going road works which will dramatically improve road condition. North of Ngaoundéré, road traffic increases due to a modal transfer from rail to road for merchandises whose final destination is Northern Cameroon or Chad. Between Maroua and Kousseri, traffic decreases, possibly constrained by poor road condition before catching up
61
again, partly fed by illegal transit from Nigeria. On the most deteriorated sections, the average speed is currently quite low (between 10 and 30 km per hour, depending on the season). Current traffic on the Maroua-Mora section averages 670 vehicles per day of which 34 percent are trucks. 6. Macro-economic parameters were considered for both Cameroon and Chad, and led to an estimated traffic growth rate of 6 percent per year. However, to be conservative, the traffic growth rate used for this economic analysis is 5 percent. In recent years, traffic of commercial vehicles has grown at 7 percent per year and traffic of private vehicles at 3.5 percent per year in the project area. In addition, induced traffic of about 15 percent of the normal traffic was factored in the evaluation considering conservatively a price elasticity of demand for transport equal to 0.7. 7. Road User Costs (RUC) were computed using the Highway Development and Management Model (HDM-4) Vehicle Operating Costs (VOC) module, considering current vehicle fleet characteristics and assuming a reduction in roughness with the project from 14 to 2 IRI, m/km. Maintenance costs have been defined according to the standards costs recorded for paved roads in Cameroon. The table below presents the 2013 average annual daily traffic and the estimated unit road user costs with and without the project.
Table 6.1: Average Daily Traffic (vehicles/day) and Unit Road User Costs (US$ per vehicle-km)
Indicator Car Pickup Mini Heavy Light Medium Heavy
Total Bus Bus Truck Truck Truck
Average Annual Daily Traffic 217 84 187 15 30 23 112 668 Unit Road User Costs (RUC) with the Project 0.36 0.66 6.36 44.94 1.38 1.52 2.58 115.6 Unit RUC without the Project 0.68 1.12 11.4 97.40 2.34 2.64 5.40 240.1 8. An evaluation period of 20 years and a discount rate of 12 percent have been considered. The economic evaluation results indicate that the Economic Internal Rate of Return (EIRR) of the project is 53 percent with a Net Present Value (NPV) of US$334 million, at 12 percent discount rate. Vehicle operating costs savings represent more than 90 percent of the project benefits, while travel time savings represent the rest, as no other economic benefits have been monetized. The very high value of the EIRR is explained by the very poor condition of the Maroua-Mora road section (International Roughness Index estimated between 14 and 16); especially during the rainy season when some days this section is only passable with a four wheel drive SUV. 9. The table below presents the results of the EIRR sensitivity analysis, indicating that; if traffic was 10 percent (respectively 20 percent) lower than expected, the EIRR would go down to 48 percent (respectively 43 percent). If the investments costs were 10 percent (respectively 20 percent) higher than expected, the EIRR would go down to 49 percent (respectively 46 percent).
62
In the most unfavorable scenario (traffic down by 20 percent, investment costs up by 20 percent), the EIRR is still estimated at 38 percent.
Table 6.3: EIRR Sensitivity Analysis for the Maroua-Mora road
Base Case Sensitivity Scenarios A: Costs B: Traffic + 20% - 20% A & B
EIRR 46% 43% 38% NPV (in US$ million) 320 248 335
Other benefits related to bundling rehabilitation and maintenance within performance-based contracts have not been evaluated in the above. Analysis as a full life cycle cost analysis would be required to fully capture them and would require uneasy assumptions. However, it is anticipated, based on international experiences such as in Brazil with the CREMA contracts27, that: (a) contract management will be improved, with a much smaller likelihood of cost overruns; (b) rehabilitation quality is likely to be above average, reaching the contractual quality standards; for example, in the State of Bahia, Brazil, about 95 percent of rehabilitated sections met the contractual quality standards for pavement roughness28.
II. Rail
10. The production of an EIRR for the signaling component alone would not result in a relevant decision tool, as this component comes as a complement to ongoing rehabilitation efforts and the expected benefits expected for the overall rehabilitation program cannot be easily broken down in order to estimate which exact part of the global benefits is attributable to signaling. 11. Accordingly, like for the CEMAC TTF project, it was decided against a quantitative assessment of the economic impact of this project component, but rather to focus on a qualitative analysis to show this complementary investment will further strengthen the railway operator’s financial situation, improve the quality of the services offered, and consequently increase the relevance and importance of the rail sector as a whole. Benefits:
12. Expected generic impacts of the rail component of the project can be divided into:
a) positive impacts on the three national economies (Cameroon, Chad and CAR), resulting from the intrinsic advantages of rail transport (transport costs about 20 to 40 percent less than road transport costs, lower fuel consumption per ton-km, lower road maintenance costs, etc.);
b) financial impact on the railway concession;
27 See for example Performance-based contracts in the road sector in Brazil, World Bank, TP-31, 2010 28 See ICR for the State Highway Integrated Management Project, January 2014.
63
c) financial impact on the Cameroon Government; d) environmental impact due to reduced greenhouse gases and local pollutants emissions
per ton-km transported compared to road transport; and e) road safety impact due to truck accidents avoidance through transfer of cargoes from
the road to the rail. 13. Expected specific impacts of the rail component of the project. The activities financed by the project should result in an increase in safety, higher rolling stock utilization rates, higher capacity of the infrastructure in terms of train / day, and eventually an increase in CAMRAIL's competitiveness and traffic. The economic benefits of such an increase in traffic lie mainly in a modal shift of freight from road to rail-based transport: every ton traveling by rail is not transported by road, which leads to substantial savings in terms of transport costs, fuel consumption, external costs related to road-based transport and road maintenance costs.
64
Annex 7: Environmental and Social Safeguards
CAMEROON: Multimodal Transport Project 1. Appropriate environmental and social management of the Cameroon Transport and Transit Facilitation Project is not only critical to long-term sustainability, but also increases the project’s profitability by anticipating potential problems and avoiding ex-post mitigating measures, always costlier than prevention. Further, the impact of the project on economic and social development in Cameroon is also enhanced by the proper management of social and environmental issues and challenges.
I. Regulatory Context 2. Cameroon has an established institutional and regulatory framework for the management of environmental assessments (EAs). All large projects, such as roads, are subjected to EAs that must be reviewed by the Inter-Ministerial Committee on the Environment and can be subjected to public hearings. Once validated by the Inter-Ministerial Committee on the Environment, a certificate of compliance is issued by the Minister of Environment, Nature Protection and Sustainable Development. This EA process has been operational since 2005. The New EA Decree was published in February 2013. The regulatory frame work seems complete now in Cameroon. It is important to notice that some weaknesses in terms of the technical capacity of the inter-ministerial committee to review complex EAs and to monitor the implementation of their Environmental Management Plans (EMPs) are remaining. II. Applicable Safeguard Policies
3. The project is designated Category B per the Bank’s policy on Environmental Assessment (OP/BP 4.01). The description below clarifies the rationale of the safeguard policies triggered by the proposed project.
OP 4.01: The project supports the rehabilitation of 61 km deteriorated road section (Maroua-Mora). The project activities may have environmental and social impacts that need to be correctly managed. An Environmental and Social Impact Assessment (ESIA) including the appropriate environmental and social mitigation and management measures (ESMP) was prepared and disclosed by the borrower prior project appraisal. The loss of natural habitats is not anticipated as the initial road footprint will not be modified.
OP. 4.11: The proposed operation will involve significant excavations and movement of earth for the planned rehabilitation. The ongoing Environmental and Social Impact Assessment (ESIA) has not anticipated any threat against physical cultural resources, and the ESMP which forms part of the ESIA includes clear procedures that will be required for identification, protection of cultural property from theft, and treatment of discovered artifacts, and is included in the bidding documents. The ESIA/ESMP provides procedures for handling with “chance finds” during implementation project activities.
65
OP. 4.12: This policy is triggered to assist in management of involuntary resettlement, land acquisition or restriction of access to assets in the project areas during the whole Maroua-Mora road section rehabilitation process. A RAP acceptable to the Bank has been prepared by the borrower. The RAP includes procedures for identifying eligible project-affected people, calculating and delivering compensation, and mechanisms for redress of dispute grievances. Well documented consultation mechanisms will be required to establish eligibility for compensation. The RAP will be implemented prior to beginning of works on the project site. OP. 4.36: This policy is triggered due to the fact that the ESIA identified that more than 3400 trees will be lost and 10000 trees will be planted during the project implementation.
4. The borrower has prepared a comprehensive Environmental and Social Impact Assessment (ESIA) of the project. Detailed measures to reduce or mitigate identified environmental and social impacts of the proposed project were prepared and summarized in the ESMP which was available prior to appraisal. Environmental and social impacts of the project, for the most part, are minimal, site-specific and manageable to an acceptable level. 5. The environmental and social analytical work results in the publication of the following documents:
a) The ESA documentation consisting of an Environmental and Social Impact Assessment (ESIA) report, the Environmental and Social Management Plan (ESMP), and accompanying annexes covering for instance Physical Cultural Resources management, public health management including HIV/STI, Contractors environmental and social prescriptions; and
b) The Resettlement Action Plan (RAP). III. Public Consultations 6. Extensive public consultations were carried out during the whole ESIA process from December 2013 to January 2014. More than 660 persons attended the consultation meetings organized in the project area. The local population expressed concerns and expectations that were summarized in the ESIA final report. The Public Consultation continues throughout project implementation with the involvement of Civil society, project-affected people (PAP), and various stakeholders. All environmental safeguards final documents were disclosed on the Ministry of Public Works website on March 3, 2014 and through the Bank’s Infoshop on March, 7, 2014. The RAP was disclosed on the Ministry of Public Works website and through the Bank’s Infoshop on March, 14, 2014. IV. Analysis of Alternatives 7. A detailed analysis of two main alternatives was carried out in the project’s ESIA and concluded that the project remains relevant and environmentally sound. The project objective is to increase transport connectivity between Maroua and Mora to facilitate intra/inter regional trade along the Douala – N’Djamena Corridor whilst supporting improvements in road operations and maintenance practices. The improvement of this section was therefore a necessity.
66
The most relevant alternative was the rehabilitation of this section. The environmental and social impacts of the project, including those related to quarries and pits were assessed to be manageable.
V. Impact assessment
5.1. Environmental impacts 8. The Ministry of Public Works has prepared an Environmental and Social Impact Assessment (ESIA) that describes road section rehabilitation work impacts. 9. Construction phase impacts. Impacts during the construction phase are caused directly or indirectly by activities along the road section including work camps and quarries.
10. Construction activities will have indirect impacts on neighboring settlements and on close urban centers where workers will seek services. These impacts are both direct and cumulative and are focused on specific areas, corridors between Maroua and Mora. 11. While the scope of the impacts at each of the construction sites will vary, the impacts of construction activities on the physical environment are concentrated at these sites, and will depend on contractor practices. 12. The main negative impacts identified are the following:
a) Destruction of fields and cultures present in the right-of-way of the work; b) Limited physical involuntary resettlements (06 dwelling houses and a few shops of
trade); c) Falling of near 3400 trees planted along the existing road; d) Disruption of services offered by the power and water supply networks at the time of
their displacement; e) Dispersal by wind and dust storms; f) Pressure on water resources due to its scarcity in the dry season (competition between
the water needs of the populations, livestock and those of the contractor’s site installation);
g) Partial or total disruption of traffic on this priority axis used by goods trucks; h) Disturbance of commercial activities around the major junctions (Para, Frolina), and
villages (Godola, Lalawai, Makalingai, etc.); i) Potential conflicts due to goods compensation process, personnel recruitment; and j) Increased risks of accidents due to speeding on the new rehabilitated road.
13. Mitigation measures were described in the ESMP and RAP and are similar for the same type of impacts at all sites (including the social impacts). These measures are integrated into bidding documents and contracts by specifying environmental and social clauses. 14. The populations in the area of influence of the project have been studied during the EA process and using also existing literature. The project area of influence has few inhabitants; the
67
most densely populated areas are close to the Maroua and Mora towns. The total population living in the area of influence is estimated at about 3,500,000 inhabitants. Critical economic activities in the area are agriculture (practiced by practically all households), sedentary and itinerant livestock. 15. Expected social impacts are analyzed in detail in the project’s ESIA and classified into major, moderate, minor, and negligible impacts for the different phases of construction and operation. The main negative social impacts identified are the following:
a) Limited physical involuntary resettlements (06 dwelling houses and a few shops); b) Disruption of services offered by the networks at the time of their displacement; c) Pressure on water resources due to its scarcity in the dry season (competition between
the water needs of the populations, livestock and those of the contractor’s site installation);
d) Partial or total disruption of traffic on this priority axis used by goods trucks; e) Disturbance of commercial activities around the major junctions (Para, Frolina), and
villages (Godola, Lalawai, Makalingai...); f) Potential conflicts due to goods compensation process, personnel recruitment; and g) Increased risks of accidents due to speeding on the newly rehabilitated road.
16. The road construction contractor has the contractual obligation for traffic, waste, labor force, environmental monitoring, health and safety, and hazardous materials management. This includes mitigation and management measures to deal with social and health consequences of migrant workers coming into the communities, e.g. risks of development of STI (Sexually Transmissible Infections) and of AIDS, and safety issues from construction traffic. 17. Expected positive impacts identified are the following:
a) Opportunities for employment and service to young residents and local/national Small
and Medium Enterprises; b) Development of the communities around construction camps due to the implementation
of certain equipment (electricity, internet, access roads...) by the company; c) Cultural mixing between the project team and the residents and feedback; d) Improvement of Communal revenues by the payment of quarries exploitation fees; e) Facilities transfer to local communities for the purpose of hosting basic social
infrastructures at the end of the road construction activities; f) Travel time optimized and reduction of vehicles maintenance costs; and g) Traders Revenues increased in the Region and neighboring countries through securing
the transport of goods, compliance with delivery schedules, reduction in losses due to traffic accidents.
18. Land acquisition and resettlement. The proposed project will not require direct and permanent land take. The rehabilitation will use existing footprint. In any case, the RAP has identified all losses and the relevant PAPs which will be compensated accordingly.
68
19. The GoC has committed itself through the RAP to the requirements of OP 4.12 for resettlement and compensation. These requirements are considerably more stringent than the applicable domestic legal framework. While the GoC has been reluctant to compensate in a manner consistent with OP 4.12 requirements in the past, these problems have been resolved in the past three years, and the GoC now routinely compensates according to Bank standards in all IDA-financed projects. 20. Impacts on physical-cultural resources. Physical Cultural Resources were addressed in the draft EA. The ESMP provides guidelines regarding the management of chance finds. VI-Environmental and Social Management Plan (ESMP) 21. The Environmental and Social Management Plan (ESMP) is made up of mitigation measures that are proportional and sufficient to mitigate the impacts identified in the ESIA. 22. The ESMP comprises several components which are to be integrated and implemented by implementing Agency (Ministry of Public Works) and its contractors. The ESMP includes the following elements: (a) the objectives of the ESMP; (b) the project description; (c) the project positive and negative impacts; (c)the proposed mitigation measures; (d) The preliminary works action plan, (e) The Civil works action plan; (f) Exploitation action plan; (g) Control and Monitoring Action Plan including the agencies responsible for implementing the ESMP; (h) Environmental Monitoring Plan; and (i) the ESMP costs and budget. The ESMP is aligned with the project implementation period. 5.2. ESMP management and capacity building 23. The implementation arrangements for the ESMP are fully integrated with the overall implementation arrangements of the project. Public Works Ministry has the ultimate responsibility for the project’s compliance with Cameroonian legislation and Bank safeguards guidelines. Public Works Ministry coordinates closely with the Ministries involved in the project, notably Ministry in Charge of Environment, the Ministry of Economy and Regional Planning (MINEPAT), and the Ministry in Charge of Compensation.
24. The ESMP includes continued capacity building measures to strengthen various stakeholders’ capacity for technical assistance and to handle safeguards issues according. VII- Environmental and Social Strategic Assessment in the Public works sector 25. Given that the Government has developed a long-term planning document “Vision 2035”, which envisions Cameroon becoming an emerging nation by 2035. The 2009 Growth and Employment Strategy, covering 2009-2019, is anchored in the “Vision 2035” which envisages significant investments in infrastructure. The project will also facilitate a systematic process for evaluating the environmental consequences of the proposed programs initiatives in order to ensure that they are fully included and appropriately addressed at the earliest appropriate stage of decision making process.
Echambot
Mouloundou
Abong-Mbang
Lokomo
Yola
BatouriYabassi
Limbé
Akonolinga
Fotokol
Maltam
Mora
Yagoua
Kaélé
Figuil
Mbé
Banyo
Ngai
Touroua
Tibati
Garoua-Boulai
Ngaoundal
Bélabo
Nanga-Eboko
SangbéBankimKumbo
Wum
Bafang
Nkongsamba
Tiko
Edéa Eséka
Sangmélima
Ambam
Mbalmayo
Kribi
Dschang
Kumba
MamféFoumban
Yoko
NtuiBuéa
Douala
Ebolowa
Bertoua
Bafoussam
Bamenda
Ngaoundéré
Garoua
Maroua
YAOUNDÉ
N I G E R I A
C H A D
C E N T R A L A F R I C A NR E P U B L I C
C O N G OG A B O NEQUATORIALGUINEA
EQUATORIALGUINEA
N O R D -O U E S T
S U D -O U E S T
O U E S T
L I T T O R A L
C E N T R E
S U D
E S T
A D A M A O U A
N O R D
E X T R E M E
N O R D
Kousseri
Echambot
Mouloundou
Abong-Mbang
Lokomo
Yola
BatouriYabassi
Limbé
Akonolinga
Fotokol
MaltamKousseri
Mora
Yagoua
Kaélé
Figuil
Mbé
Banyo
Ngai
Touroua
Tibati
Garoua-Boulai
Ngaoundal
Bélabo
Nanga-Eboko
SangbéBankimKumbo
Wum
Bafang
Nkongsamba
Tiko
Edéa Eséka
Sangmélima
Ambam
Mbalmayo
Kribi
Dschang
Kumba
MamféFoumban
Yoko
NtuiBuéa
Douala
Ebolowa
Bertoua
Bafoussam
Bamenda
Ngaoundéré
Garoua
Maroua
YAOUNDÉ
N’DJAMENA
N O R D -O U E S T
S U D -O U E S T
O U E S T
L I T T O R A L
C E N T R E
S U D
E S T
A D A M A O U A
N O R D
E X T R E M E
N O R D
N I G E R I A
C H A D
C E N T R A L A F R I C A NR E P U B L I C
C O N G OG A B O NEQUATORIALGUINEA
EQUATORIALGUINEA
Bénoué
Vina
Djérem
Sanaga
Kade
i
Boumba
Dja Kom
Nyong
Mbam
Mbu
Faro
Lom
Wouri
Gul f ofGuinea
LakeChad
To Maiduguri
To Maiduguri
To Massaguet
To Mandélia
To Guelengdeng
To KimTo
PalaTo
Leré
To Bouar
To Oyem
To Ikom
10°�E 12°�E 14°�E 16°�E
12°�E
10°�E8°�E
14°�E 16°�E
2°�N
4°�N
6°�N
8°�N
10°�N
12°�N
2°�N
4°�N
6°�N
8°�N
10°�N
12°�N
0 40 80 120
0 40 80 120 Miles
160 Kilometers
IBRD 40735R
FEBRUARY 2014
CAMEROONMULTIMODAL TRANSPORT
PROJECTPROJECT WORKS:
ROAD REHABILITATION WORKS
PERFORMANCE-BASED ROUTINE MAINTENANCE
RAIL SIGNALLING
CITIES AND TOWNS
PROVINCE CAPITALS
NATIONAL CAPITAL
MAIN ROADS
RAILWAYS
PROVINCE BOUNDARIES
INTERNATIONAL BOUNDARIES
This map was produced by the Map Design Unit of The World Bank.The boundaries, colors, denominations and any other informationshown on this map do not imply, on the part of The World BankGroup, any judgment on the legal status of any territory, or anyendorsement or acceptance of such boundaries.
GSDPMMap Design Unit