public disclosure authorized implementation...

Document of The World Bank

Report No: ICR00003327

IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-40830 TF-54399 TF-54400 TF-55065 TF-55922 TF-55924)

ON A

CREDIT

IN THE AMOUNT OF SDR 11.7 (US$17.50 MILLION EQUIVALENT)

TO THE

REPUBLIC OF ALBANIA

FOR AN

INTEGRATED COASTAL ZONE MANAGEMENT AND CLEAN-UP PROJECT

(P086807)

April 27, 2016

Environment and Natural Resources Global Practice South East Europe Country Management Unit Europe and Central Asia Region

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 August 19, 2015)

Currency Unit = Albanian Lek (ALL) 1.00 ALL= US$ 0.00816 US$ 1.00 = 126.15 ALL

FISCAL YEAR

Republic of Albania January 1 –December 31 World Bank July1 – June 30

ABBREVIATIONS AND ACRONYMS

APL Adaptable program loan AMMP Aftercare Management and Maintenance Plan CAS World Bank Country Assistance Strategy CVCDP CZMP

Coastal Village Conservation and Development Program Coastal Zone Management Plan

EIA Environmental Impact Assessment EMP ESSF

Environmental Management Plan Environmental and Social Safeguards Framework

GoA GEF GEO

Government of Albania Global Environment Facility Global Environmental Objective

IBRD International Bank for Reconstruction and Development ICZM ICZMCP

Integrated Coastal Zone Management Integrated Coastal Zone Management and Clean-up Project

ICR Implementation Completion Report IP IRR ISR

Inspection Panel Internal rate of return Implementation Status Report

KfW KfW Development Bank MAP MSP

Management Action Plan Medium Size Project

M&E Monitoring and evaluation MoUDT Ministry of Urban Development and Tourism MoPWTT Ministry of Public Works, Transport and Telecommunications NPV Net present value PAD Project Appraisal Document PCU Project coordination unit PDO Project Development Objective R&F Roof & Façade (Program) RAP REA

Resettlement Action Plan Regional Environmental Agency

SCDP South Coastal Development Plan TA Technical assistance WWTP Wastewater treatment plant

Vice President: Cyril Muller

Country Director: Ellen Goldstein

Senior Director: Paula Caballero

Practice Manager: Project Team Leader:

Kulsum Ahmed Adriana Damianova/ Drita Dade

ICR Team Leader: Sanjay Srivastava

1

ALBANIA Integrated Coastal Zone Management and Clean-up Project

CONTENTS 1. Project Context, Development Objectives, and Design ............................................ 14

2. Key Factors Affecting Implementation and Outcomes ............................................ 28

3. Assessment of Outcomes .......................................................................................... 46

4. Assessment of Risk to Development Outcome ......................................................... 55

5. Assessment of Bank and Borrower Performance ..................................................... 57

6. Lessons Learned ........................................................................................................ 60

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners ........... 63

Annex 1. Original Indicators ............................................................................................. 64

Annex 2. Project Costs and Financing .............................................................................. 71

Annex 3. Outputs by Component...................................................................................... 72

Annex 4. Environment and Social Safeguards ................................................................. 79

Annex 5. Economic and Financial Analysis ..................................................................... 84

Annex 6. Bank Lending and Implementation Support/ Supervision Processes .............. 103

Annex 7. Beneficiary Survey Results ............................................................................. 105

Annex 8. Stakeholder Workshop Report and Results ..................................................... 118

Annex 9. Summary of Borrower's ICR and/or Comments on Draft ICR ....................... 120

Annex 10. Comments of Cofinanciers and Other Partners/Stakeholders ....................... 121

Annex 11. Selected Supporting Documents ................................................................... 122

MAP NO. IBRD 33577R ................................................................................................ 124

MAP NO. IBRD 33742................................................................................................... 125

2

A. Basic Information

Country: Albania Project Name: Integrated Coastal Zone Management & Clean-Up Project (APL #1)

Project ID: P086807 L/C/TF Number(s):

IDA-40830,TF-54399,TF-54400,TF-55065,TF-55922,TF-55924

ICR Date: 10/09/2015 ICR Type: Intensive Learning ICR

Lending Instrument: APL Borrower: GOVERNMENT OF ALBANIA

Original Total Commitment:

XDR 11.70M Disbursed Amount: XDR 10.51M

Revised Amount: XDR 10.51M

Environmental Category: F

Implementing Agencies: Ministry of Urban Development

Cofinanciers and Other External Partners: B. Key Dates

Process Date Process Original Date Revised / Actual

Date(s)

Concept Review: 03/02/2004 Effectiveness: 11/29/2005 11/29/2005

Appraisal: 04/12/2005 Restructuring(s):

03/22/2010 01/28/2011 11/21/2012 06/13/2014

Approval: 06/21/2005 Mid-term Review: 10/15/2012 11/13/2012

Closing: 03/31/2010 03/31/2015 C. Ratings Summary C.1 Performance Rating by ICR

Outcomes: Moderately Satisfactory

Risk to Development Outcome: Substantial

Bank Performance: Moderately Satisfactory

Borrower Performance: Moderately Satisfactory

3

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings

Quality at Entry: Moderately Unsatisfactory

Government: Moderately Satisfactory

Quality of Supervision: Moderately SatisfactoryImplementing Agency/Agencies:

Moderately Satisfactory

Overall Bank Performance:

Moderately SatisfactoryOverall Borrower Performance:


C.3 Quality at Entry and Implementation Performance Indicators

Implementation Performance

Indicators QAG Assessments

(if any) Rating

Potential Problem Project at any time (Yes/No):

Yes Quality at Entry (QEA):

None

Problem Project at any time (Yes/No):

Yes Quality of Supervision (QSA):

None

DO rating before Closing/Inactive status:


D. Sector and Theme Codes

Original Actual

Sector Code (as % of total Bank financing)

General public administration sector 15 5

General water, sanitation and flood protection sector 30 20

Other social services 10 15

Ports, waterways and shipping 15 30

Solid waste management 30 30

Theme Code (as % of total Bank financing)

Environmental policies and institutions 14 20

Land administration and management 29 5

Municipal governance and institution building 14 15

Other environment and natural resources management 14 30

Pollution management and environmental health 29 30

4

E. Bank Staff Positions At ICR At Approval

Vice President: Cyril E Muller Shigeo Katsu

Country Director: Ellen A. Goldstein Orsalia Kalantzopoulos

Practice Manager/Manager:

Kulsum Ahmed Laura Tuck

Project Team Leader: Adriana Jordanova Damianova Rita E. Cestti

ICR Team Leader: Sanjay Srivastava

ICR Primary Author: Sanjay Srivastava

5

F. Results Framework Analysis

Project Development Objectives (from Project Appraisal Document)1 The development objective of the Integrated Coastal Zone Management and Clean-up Project (ICZMCP-APL1) is to set-up and initiate an integrated coastal zone management approach to reduce coastal degradation through: (i) enhancing regulatory policy and governance of the coastal zone, land use and regional planning, and institutional capacity; (ii) initiating targeted municipal and community investments in the southern coast to improve environmental conditions, enhance cultural resources and encourage community support for sustainable coastal zone management; and (iii) reducing soil and groundwater contamination in the former chemical plant at Porto Romano. The project included funding support from the Global Environmental Facility (GEF) that had a Global Environmental Objective (GEO). The GEO of the Project is to assist Albania in meeting its international commitments to protect Butrint National Park under the Ramsar Convention on Protection of Wetlands and relates to the GEF Medium Size Project (MSP) that was fully blended with the ICZMCP. Revised Project Development Objectives (as approved by original approving authority) The revised development objective is to assist the Government of Albania in developing on a sustainable basis, tourism in South Albania coast, by improving critical public environmental infrastructure and municipal services, remediating and containing pollution hazards from the former chemical plant in Porto Romano in Durres, improving community infrastructure and enhancing architectural and cultural resources. The GEO remained the same at Project restructuring. (a) PDO Indicator(s) Restructured PDO Indicators (Original PDO and GEO indicators can be found in Annex 1)

Indicator Baseline Value Formally

Revised Target Values

Actual Value Achieved at Completion or Target Years

Indicator 1 :

Increased % of population served by the newly built Landfill site and Transfer Station through establishment of infrastructure for safe disposal of municipal solid waste in the Southern Coast that meets EU standards through construction of a landfill in Bajkaj and transfer station in Himare built and operational

1 Please note that PDO formulation in the PAD differs from the one in the Financing Agreement.

6

Value quantitative or Qualitative)

No sanitary landfilling capacity in the South Coast

Landfill capacity for 25000 tons waste/year built

Sanitary landfill of 365000 m3 capacity accommodating disposal of 25000 tons waste annually/at 712kg/m3 for at least 10 years of operation.

Date achieved 05/25/2005 03/31/2015 03/31/2015 Comments (incl. % achievement)

The target has been met.

Indicator 2 :

Improvement of the piped household and hotel water supply and sewer household and hotel connections in Saranda through Reconstruction of sewer networks (2.1 km of new sewer lines) and extension of water supply (2.5 km); Construction of wastewater outlet from the WWTP in Saranda to the Chuka Channel (2.8 km); [12.5] km Navarica Trunk main replaced and existing reservoir (1000 m3) rehabilitated.


Existing water supply and sewage system ineffective to meet the waters supply and sanitation needs of Saranda

Reconstruction of sewer networks (2.1 km of new sewer lines) and extension of water supply (2.5 km). Construction of wastewater outlet from the WWTP in Saranda to the Cuka Channel (2.8 km). [12.5 km] Navarica Trunk main replaced.

Works completed in Saranda include: wastewater outlet from the WWTP to the Cuka Channel; 2.1 km sewer line within town; 12.9 km Navarica main trunk is replaced; 2.8 km water supply distribution network in tourist areas.


Target fully met.

Indicator 3 : Increased access for international tourists and access of cruise liners to the South Coast by Reconstruction of port facilities through a 180m new berth front with 9meter water depth, paving and drainage, fencing, and utilities constructed


Existing Passenger Port Terminal of Saranda is inadequate to provide access of cruise liners which is a constraint to increase the number of international tourists to the Southern Coast.

A new 180 m birth front with 9 meter water depth, paving, drainage, fencing and utilities constructed at Port of Saranda.

Rehabilitation of the Passenger Port Terminal is completed. 180 m new berth with waterfront depth of 9 m and all auxiliary facilities are completed. The Port is fully operational.

Date achieved 05/25/2005 03/25/2010 03/31/2015

7

Comments (incl. % achievement)

Target fully met.

Indicator 4 : Remediation of contaminated sites through removal and containment of hazardous materials in Porto Romano to reduce human health hazards.


Containment of on-site contamination not addressed.

Safe landfill facility for encapsulation of 45,000 m3 of hazardous waste on one of the hazardous sites constructed.

Remediation and cleanup of hotspots sites is 100% complete with safe disposal and encapsulation at the CDF (Confined Disposal Facility) of more than 45,000 m3 hazardous waste.


Target fully met.

Indicator 5 : Community based investments in coastal villages have improved infrastructure enabling sustainable tourism development in the South coast


There are no specific investments targeting village infrastructure in the coastal villages supporting sustainable tourism.

Round two of community based infrastructure investments including Roof and Facades Rehabilitation and B&B window implemented.

9 road/square rehabilitation and 5 water supply schemes in the participating villages. Ten villages benefited: Dhermi, Ilias, Nivice Piqeras Ksamil Xarre, Pllake-Qenurio, Bajkaj-Palavli) of total of 18,400 residents and 24,100 tourists; 27 houses in R&F.


Target fully met.

Indicator 6 :

Protection and promotion of vernacular architecture of the South Coast by enhancing conditions for conserving traditional villages and increasing their economic development potential by piloting a Roof and Facades and Bed and Breakfast Program


None Up to 62 houses included in the R&F program.

Support provided to 27 houses for rehabilitation under the Roof and Facades Program and for 2 under the Bed & Breakfast window.


Target partially met (47%).

8

(b) Intermediate Outcome Indicator(s) The restructuring paper (Annex 4 – Results Framework and Monitoring, dated March 8, 2010) outlines a list of 26 Intermediate Outcome Indicators distributed across each component. Many of the 26 Intermediate Outcome indicators did not include baseline values nor a clear target or output, or were related to process monitoring and project management and therefore were not monitored. The following outlines the results monitoring report based on the last ISR before the close of the project.

Indicator Baseline Value Formally Revised Target

Values Actual Value Achieved at

Completion or Target Years

Indicator 1 : 12.5 km Navarica Trunk main replaced, water storage capacity improved including an existing reservoir (1000 m3) rehabilitated.

Value (quantitative or Qualitative)

Inadequate water supply and sanitation systems in place.

Execution of water supply and sanitation works completed including wastewater outlet, 12.5 km main trunk and reservoir rehabilitation to improve storage capacity.

Water supply and sanitation works completed and include 1.9 km wastewater outlet; 2.1 km sewer line within the town;12.9 km Navarica main trunk replaced, improving existing water supply capacity and extension of distribution network in tourist area.


Target met.

Indicator 2 : Service contract signed with participating municipalities and communes for waste disposal.


No provisions for commercial operation of the landfill facility (prior to and at restructuring).

1) Service contract signed with participating communities (2) Contract signed with landfill operator.

Solid waste company legally established as a fully owned company by the Vlora Qark. Service agreements signed with all municipalities in the service area of the landfill.

Date achieved 03/25/2010 03/31/2015 03/31/2015


Target substantially met. Another related Intermediate Indicator, “Contract signed with landfill operator” was achieved by the close of the project in March 2015.

Indicator 3 : Coastal communities and Local Government Units participate in Coastal Village Conservation Development (CVCD) Program identification.


Communities actively participated in round one of the CVCD program.

1)Village infrastructure rehabilitation program completed 2)R&F rehabilitation projects implemented in up to 62 houses; 3)Up to 20 homeowners involved in B&B services program

Round 2 implemented 9 projects for rehabilitation of the village roads & squares; 5 projects for water supply systems in coastal villages. Communities and house owners participated in the process and with own funds.

Date achieved 03/25/2010 03/31/2015 03/31/2015 Comments (incl. %

Target substantially met.

9

achievement) Indicator 4 : Risk assessment undertaken for the Porto Romano hot-spot.


There is no risk assessment (RA).

RA completed prior to design of encapsulation and containment of contaminated site in Porto Romano

Investigations of contaminated soil, groundwater and building material in the hot spot sites in Porto Romano carried out in 2007 prior to design of Confined Disposal Facility.


Target fully met.

Indicator 5 : Technical assistance for operation and maintenance of community waste supply systems and roads and Roof & Facade (R&F) and small scale tourism provided to participating villages


No TA in place prior to project restructuring

TA for O&M of village water supply system and road maintenance provided to villages participation in Round 2 of CVCDP; TA provided for the design of R&F and B&B investments.

Training on R&F and B&B carried out in 2013-14. Local campaign for community awareness on waste management in March 2015. All communities received TA for projects.


Target substantially met.

Indicator 6 : Reconstruction of Port facilities to allow access of cruise liners in order to facilitate passenger access to the Southern Coast


Saranda's old passenger port facilities in operation

Rehabilitation of Passenger Port facilities is 100% completed.

Completion of passenger port rehabilitation infrastructure as per the design parameters; Port facilities operational.


Target fully met.

Indicator 7 : Resettlement of the families on the former site completed in accordance with the agreed Resettlement Action Plan and legal titles provided.


Resettlement Action Plan for Porto Romano completed prior to appraisal.

Titles granted to four families

Resettlement Action Plan prepared and families resettled prior to construction works. Legal ownership titles were granted to families that filed for title.


Target met.

Indicator 8 : Landfilling and encapsulation of 45,000 m3 of hazardous waste on one of the sites.

10


No hazardous waste landfilled and encapsulated in Porto Romano.

Execution of remediation works completed. Site after-care program designed and agreed with Durres municipality and MOEFW; Site monitoring infrastructure in place.

Construction of CDF completed. 45,000 m3 of contaminated soil and debris from the demolition of buildings in three Hot Spots safely encapsulated in CDF. Aftercare plan approved.


Target fully met.

Indicator 9 : Social & Vulnerability Assessment carried out in accordance with agreed Terms of Reference Value (quantitative or Qualitative)

No SVA available prior to project restructuring.

SVA completed in accordance with TORs

SVA completed as per TOR.


Target fully met.

Indicator 10: Improved waste disposal infrastructure for the Southern Coast built in Saranda area with capacity of 25,000 t per year and the accompanying transfer station in Himare.


No waste disposal infrastructure in place for the South Coast.

Completion of Passenger Port rehabilitation infrastructure as per the design parameters; Port facilities operational.

Rehabilitation of Passenger Port facilities is 100% completed. A new quay wall of 180 m and depth 9 m, including port surface facilities are fully operational.


Target met.

G. Ratings of Project Performance in ISRs

No. Date ISR Archived

DO IP Actual

Disbursements (USD millions)

1 12/07/2005 Satisfactory Satisfactory 0.00 2 04/27/2006 Satisfactory Satisfactory 1.26 3 07/31/2006 Satisfactory Satisfactory 1.26 4 04/06/2007 Satisfactory Moderately Satisfactory 1.68

5 03/24/2008 Moderately

Unsatisfactory Moderately

Unsatisfactory 3.27

6 03/19/2009 Unsatisfactory Unsatisfactory 4.00


Unsatisfactory Unsatisfactory 4.00

11



Unsatisfactory 4.00

9 05/31/2010 Moderately Satisfactory Moderately Satisfactory 4.00 10 12/18/2010 Moderately Satisfactory Moderately Satisfactory 5.29 11 05/22/2011 Moderately Satisfactory Moderately Satisfactory 5.74 12 12/05/2011 Moderately Satisfactory Moderately Satisfactory 5.96 13 06/26/2012 Moderately Satisfactory Moderately Satisfactory 6.91

14 12/26/2012 Moderately SatisfactoryModerately

Unsatisfactory 7.35



Unsatisfactory 8.68


Unsatisfactory Moderately Satisfactory 9.72

17 06/28/2014 Moderately Satisfactory Moderately Satisfactory 11.96 18 12/11/2014 Moderately Satisfactory Satisfactory 14.66 19 03/30/2015 Moderately Satisfactory Moderately Satisfactory 15.61

H. Restructuring (if any)

Restructuring Date(s)

Board Approved

PDO Change

ISR Ratings at Restructuring

Amount Disbursed at

Restructuring in USD millions

Reason for Restructuring & Key Changes Made

DO IP

03/22/2010 Y MU U 4.00

(i) The PDO revised to focus on support for critical infrastructure for improving environmental and sanitary conditions essential for the long term coastal development and tourism; (ii) The results framework revised and updated to reflect changes made during Project restructuring (e.g., land use planning activities dropped); (iii) Extension of the Project closing date from March 31, 2010 to December 31, 2012; and (iv) Extension of the deadline for completing transfer of legal ownership and registration of title of properties for the resettled families pursuant to the Resettlement Action Plan in

12

Restructuring Date(s)

Board Approved

PDO Change

ISR Ratings at Restructuring

Amount Disbursed at

Restructuring in USD millions

Reason for Restructuring & Key Changes Made

DO IP

Porto Romano (RAP, dated 2004) to June 30, 2010.

01/28/2011 N MS MS 5.29

Amendment of DCA covenant to allow the Borrower to complete the legal process and extend the deadline up to June 30, 2011 for completing transfer of legal ownership and registration of title of properties for the resettled families in Porto Romano (as per RAP, dated 2005).

11/21/2012 N MS MS 7.35

(i) extension of the Project closing date from December 31, 2012 to June 30, 2014; (ii) reallocation of IDA Credit funds among disbursement categories; (iii) changing the percentage of expenditure to be financed for categories “Works” and “IOC” in order to bridge the anticipated IDA Credit shortfall.

06/13/2014 N MU MS 11.96

(i) extension of the Project closing date from June 30, 2014 to March 31, 2015; (ii) reallocation of IDA Credit funds among some disbursement categories.

If PDO and/or Key Outcome Targets were formally revised (approved by the original approving body) enter ratings below: Outcome Ratings Against Original PDO/Targets Unsatisfactory Against Formally Revised PDO/Targets Moderately Satisfactory Overall (weighted) rating Moderately Satisfactory

13

I. Disbursement Profile

14

This intensive learning Implementation Completion and Results Report (ICR) for the Albania Integrated Coastal Zone Management and Clean-up Project (ICZMCP) evaluates project implementation and related outcomes over a period of more than 10 years. The ICR has a unique significance because of its scope, covering a complex development agenda and a long history of engagement with an important client in the region. Furthermore, the project included an Inspection Panel case that affected project design and outcomes and had far-reaching impact on how the Bank interprets and applies its safeguards policies in all land-use projects.

The ICZMCP was approved by the World Bank Board on June 21, 2005 and declared effective on November 29, 2005. On November 1, 2007, the Executive Directors of the World Bank authorized an Inspection Panel (IP) investigation relating to the demolition of 15 buildings in the coastal community of Jale that had taken place in April 2007. Following a suspension of disbursements in January 2009, the project was restructured in March 2010 in close collaboration with the Government of Albania. The suspension on the disbursement of IDA funds was lifted in June 2010, and implementation resumed. The 2010 restructuring was a major Level 1 restructuring and was comprehensive as it involved eliminating components and revising Project Development Objectives (PDOs) and the results framework. Three minor Level 2 restructurings occurred in 2011, 2012 and 2014 which involved amending the covenant related to extending the deadline for completing transfer of legal ownership and registration of title properties for resettled families in Porto Romano (2011); extension of closing date, reallocation among disbursement categories; and changes in percentages to be financed under disbursement categories (2012); and extension of closing date and reallocation among disbursement categories (2014). The project closed on March 31, 2015. The evaluation of the implementation of the project draws significantly from the outcomes and intermediate indicators following the 2010 restructuring as project implementation began slowly and was on hold for most of 2009 and in 2010. Seventy five percent of disbursements took place after the 2010 restructuring. In terms of achievements of the PDO under the revised project and as measured by revised indicators, this ICR rates final outcomes as Moderately Satisfactory. It also finds performance by the Bank and the Borrower Moderately Satisfactory across most dimensions. Bank performance on Quality at Entry is evaluated as Moderately Unsatisfactory based on the complexity of project design relative to institutional capacity for implementation.

1. Project Context, Development Objectives, and Design 1.1 Context at Appraisal 1. Albania’s rich cultural heritage and natural beauty and the high biodiversity of

its coast are valuable assets that presented important economic opportunities for the country. In 1999 the Government of Albania (GoA) requested policy and lending support from the Bank for developing and implementing an integrated management approach to the cross-sectoral challenges of managing coastal zones and building institutional capacity, including for land-use planning. Integrated coastal zone

15

management (ICZM) is key to the sustainable development of both tourism and trade, two promising pillars to support the country’s long-term economic growth.2 Having adopted the Convention on the Marine Environment and Coastal Region of the Mediterranean in 1995, and realizing the enormous population and development pressures on the coast, in 2002 Albania adopted its national integrated Coastal Zone Management Plan (CZMP).3 The plan indicated that Albania embraced the opportunity to adopt an alternate model for development of the coastal areas, balancing protection and development by enhancing protection of pristine areas and regulating development pressures. The plan highlighted the risks associated with the southern coastal zone (with a coastline of 168 km and a population of about 70,000), where unregulated urbanization, lack of adequate infrastructure, uncollected and untreated wastewater and solid waste, pressures on protected areas and wetlands, and unsustainable use of natural resources threatened the foundations of sustainable coastal development. Rapid political changes in the early 1990s, bringing a transition to a market economy and freedom of movement, had caused rapid changes in the country’s demographic profile and in the spatial distribution of migrants from the regional turmoil, profoundly influencing land-use patterns along the southern coastline.

2. The Bank dialogue was built on the CZMP, which provided a framework for the implementation of measures for institutional capacity building and investment programs, including in high-value and carefully managed tourism. The CZMP recommended establishing a permanent coordinating body to support an integrated approach to coastal zone management and to adopt measures to improve the deteriorating coastal areas. The proposed project was expected to play a catalytic role in harmonizing development assistance activities affecting Albania’s coastal zone and in mobilizing further donor support for promoting sustainable community-focused tourism for the coast. By seeking to improve land-use management capacity at the central and local levels, the project was expected also to contribute to the theme of the new Country Assistance Strategy (CAS), which focused on improved governance as a driver of sustainable private-sector-led growth.

3. Project appraisal highlighted the country’s planning and institutional weaknesses and risks, 4 particularly the multiplicity of institutions responsible for land-use planning and development control in Albania, and the very weak enforcement of zoning regulations. In the transition from a centrally planned to a market economy, unregulated development and the lack of adequate infrastructure, compounded by the inadequate institutional framework for ICZM and weak local governance capacity, posed a serious threat to the environment and protected areas in the Albanian coastal area, and jeopardized sustainable development of the country’s key asset. Illegal construction

2In 2002, the tourism industry generated 12% of total gross domestic product, and 10% of total employment. 3The CZMP was supported by the Mediterranean Environment and Technical Assistance Program launched in 1990 by the World Bank and European Investment Bank, in partnership with the European Union and the United Nations Development Programme. 4 As noted in the PAD, pages 1-2, under Strategic Context – Country and Sector Issues.

16

and settlements along the coastline, both by squatters and by speculative land developers, were identified as a serious problem in Albania.

1.2 Original Project Development Objectives (PDOs) and Key Indicators (as

Approved) 4. The original development objective of the Integrated Coastal Zone Management and

Clean-up Project5 (ICZMCP) was “to set up and initiate an integrated coastal zone management approach to reduce coastal degradation through (i) strengthening regulatory policy and governance of the coastal zone, land-use and regional planning, and institutional capacity at the central, regional and local levels; (ii) initiating targeted municipal and community investments in the southern coast to improve environmental conditions, enhance cultural resources and encourage community support for sustainable coastal zone management; and (iii) reducing soil and groundwater contamination in the former chemical plant at Porto Romano.”

5. The Global Environmental Objective (GEO) of the Project was to assist Albania in meeting its international commitments to protect Butrint National Park under the Ramsar Convention on Protection of Wetlands and relates to the GEF Medium Size Project (MSP) that was fully blended with the ICZMCP.

6. However, the Development Credit Agreement (dated June 29, 2005), defined the project objectives slightly differently: “to establish an integrated approach to coastal zone management by carrying out policy reform, institutional development and investments to protect coastal resources and promote sustainable development and management of the Borrower’s southern coast.” While the intent and meaning in both PDO formulations are similar, the use of the word “establish” in place of “set up and initiate,” and the combination of policy reform, institutional development, and investments, represent broader coverage than the specific activities defined in the PAD. There is no material difference between the PDOs as stated in the PAD and those stated in the Development Credit Agreement. Therefore, this ICR uses the statement of objectives as written in the PAD instead of PDO as stated in the Development Credit Agreement. There are also differences between the original indicators as specified in the body of the PAD and Annex 3 of the PAD. For this ICR, the original indicators are drawn from the Results Framework, as per Annex 3 of the PAD. This ICR also focuses only on the evaluation of the project results and lessons learned, drawing on the context in which implementation occurred, including the IP investigation. It evaluates the two distinct phases of project implementation, pre- and post-IP investigation. It does not deliberate on or evaluate external processes, such as the IP investigation itself.

5As per PAD dated May 25, 2005,there was also a Global Environmental Objective (“To assist Albania in meeting its international commitments to protect the Butrint National Park under the Ramsar Convention on protection of wetlands”) related to the GEF grant, which was blended with IDA resources. However, for a blended project, the Bank objectives are evaluated as per IEG evaluator’s guidelines.

17

7. The sixteen key indicators for achievement of the PDO (as originally approved – as per page 10, Section 3, “Project development objective and key indicator” of the PAD and consistent with Annex 3, “Results Framework and Monitoring”) were:

(a) Completion and approval of the Southern Coast Development Plan (SCDP) by the National Council of Territorial Adjustment.

(b) Development of communal infrastructure in the southern coastal area in compliance with the SCDP

(c) Local land-use planning and issuing of construction permits in the southern coast in compliance with the parameters and measures set forth in the SCDP.

(d) New buildings in the southern coastal area do not disturb the existing spatial value and characteristics.

(e) Local, regional, and national physical planning efforts and development initiatives aligned with the principles and guidelines of the SCDP.

(f) Stakeholder participation incorporated into coastal zone management decisions. (g) At least 5,000 tons of household waste and 5,000 tons of construction and

demolition waste collected and disposed of in proper landfill facilities. (h) At least 50% of tourist wastewater load in Saranda collected and treated. (i) At least 50% of public beaches and shellfish areas in the southern coast

monitored for water quality against Albanian and EU standards. (j) Tourism and visitor revenues in the southern coast of Albania increased and

benefiting wider communities. (k) Protected areas management plan for the Butrint National Park developed with

wide stakeholder participation, and rules enforced through appropriate by-laws. (l) Detailed regulatory plans formulated, adopted, and enforced by at least three

coastal municipalities and/or communes. (m) Local strategic plans formulated and adopted by at least 5 communes in the

southern coast (n) Execution of environmental impact assessment (EIA) in accordance with the

EIA procedures (o) Enhanced economic incentives to promote integrated coastal zone management

objectives introduced and actively used (p) Reduction of soil contamination in Porto Romano guided by the land-use plan

formulated and adopted by the Municipal Council of Durres 1.3 Revised PDO (as approved by the Board) and Key Indicators

8. In March 2010 the project underwent a major Level 1 restructuring reflecting

findings of the IP investigation. The revised PDO is “to assist the Government of Albania in developing, on a sustainable basis, tourism in the South Albania coast by improving critical public environmental infrastructure and municipal services, remediating and containing pollution hazards from a former chemical plant in Porto Romano near Durres, improving community infrastructure and enhancing architectural and cultural resources.” The GEO remained the same.

9. The revision to the PDO and components was strongly influenced by the IP case and by significant changes in the economic, financial, and technical environment

18

specific to the original design of the project. The findings of the Inspection Panel Investigation Report (Inspection Panel Report, Report No. 41189-AL dated October 17, 2007 and Investigation Report No. 46596-AL dated November 24, 2008), the Management Response to the IP report (Report No. 47653-AL dated February 18, 2009),6 and subsequent discussions with the Government of Albania led to the March 2010 restructuring.7 In the restructuring, project activities that related to urban and land-use planning were dropped, the key indicators were modified, and the project instrument was changed from an adaptable program loan (APL) to an investment loan.

10. The restructured project redefined the project-specific results indicators so that

they could be properly monitored. Because Albania lacked environmental infrastructure in the southern coast to support tourism development, the baseline related to infrastructure indicators was assessed as zero at the time of project restructuring. Many indicators that related to land-use planning or capacity building were modified, removed, or adjusted to align with the restructured components. The restructured project simplified the results measurement to focus on measurable indicators. While the original project had 16 outcome indicators, the revised project had seven indicators:

i. Increased capacity for population served by the newly built Landfill site and Transfer Station;

ii. Improved water supply network and sewage system in Saranda; iii. Increased access for international tourists and access of cruise liners to the

South Coast; iv. Remediation of contaminated sites through removal and containment of

hazardous materials in Porto Romano to reduce human health hazards; v. Community based investments in coastal villages have improved infrastructure

enabling sustainable tourism development in the South coast; and vi. Protection and promotion of vernacular architecture of the South Coast.

vii. Protected areas management plan for Butrint National Park developed with wide stakeholder participation and rules are enforced through appropriate by-laws (GEO Indicator)8.

1.4 Main Beneficiaries 11. The primary beneficiaries of the project, both in the original PAD and after

restructuring, were the residents and communities in the southern coast. The large infrastructure investments aimed to provide support for Saranda’s tourism. The coastal village and community investments aimed to improve local village infrastructure and enhance the cultural resources, thus supporting tourism in the communities. The

6 (INSP/R2008-004/2) website http://ewebapps.worldbank.org/apps/ip/Pages/Panel_Cases.aspx. 7 The project had disbursed US$4 million, or 25% of its total value, before the restructuring.

8 This GEO indicator was achieved by restructuring in 2010, and therefore was not included in the restructured M&E Framework.

19

component on cleaning up contaminated lands from the former chemical plant at Porto Romano was intended to reduce the environmental health risks faced by the local community. For example:

(a) Residents of Saranda Municipality benefited from the investments in the water supply system and sewerage networks.

(b) The local economy benefited from the rehabilitation of the Saranda Passenger Port, which increased the flow of regional and international tourists.

(c) Residents of Himara Municipality benefited from investments in the solid waste transfer station and the rehabilitation of the water supply system and sewerage networks.

(d) Several local residents benefited from the restoration of more than 27 houses under the Roof & Facade (R&F) Program. Many more were helped with designs for restoring the traditional architectural values of their homes.

(e) Residents of Durres Municipality and Porto Romano community benefited from the removal of obsolete chemicals and remediation of contaminated sites in their neighborhood

12. In addition to the direct benefits to the targeted communities, several local and central government institutions benefited from the project as it enhanced their capacity for investment planning and for implementing and monitoring various subprojects with wide participation of local communities: Ministry of Territorial Adjustment and Tourism; Ministry of Public Works and Transport; Ministry of Urban Development and Tourism; Ministry of Environment, Forestry and Water Administration; Ministry of Culture; Ministry of Labor, Social Affairs and Equal Opportunities; Ministry of Interior, Vlora Region; Saranda Port Authority; Saranda Water and Sanitation Enterprise; and Regional Environmental Agency in Durres and Vlora.

1.5 Original Components (as approved)9 13. Component A: Integrated Coastal Zone Management Policy and Institutional

Capacity Building. The objective of this component was to enhance the capacity of the Albanian authorities to manage the coastal resources along the Adriatic and Ionian Seas by developing an adequate operational policy, legal, and regulatory framework and financial/economic instruments for ICZM; strengthening institutional capacity to increase the efficiency and effectiveness of the regulatory, planning, and management functions for ICZM at the central, regional, and local levels; strengthening the coastal water quality monitoring network; strengthening the management of protected areas in Butrint National Park; enhancing the knowledge base; and raising public awareness about the coastal issues in Albania. Component A comprised two subcomponents.

9 The financing agreement contains slightly different wording for the components but is materially consistent with the PAD. It is noted that the subcomponents in the main section of the PAD differ from Annex 5 of the PAD (and the financing agreement).). This ICR uses the version in Annex 5 of the PAD.

20

Subcomponent A.1, Strategic Policy Support, included technical assistance for: Review of the national policy, legislation, and institutional framework for coastal

management, preparation of interim regulations for ICZM, and development of a coastal zone management law.

Application of modern methodologies and tools to develop a financial and economic incentive framework for effective implementation of land-use planning, zoning, and regulatory measures, and support to coastal municipalities and communes in implementing their local plans.

Subcomponent A.2, Coastal Management Strengthening, supported institutional capacity at the central, regional, and local levels to increase the effectiveness of regulatory, planning, and management functions for ICZM by: Strengthening capacity at the central, regional, and local levels to enforce

regulatory responsibilities for land-use planning and regulations, including compliance with construction permits.

Development and acquisition of adequate management tools such as integrated GIS-based land-use applications.

Design and enactment of adequate financial and economic incentives to encourage behavioral changes in human activities in the coastal areas.

Establishment of and capacity building for a functional ICZM institutional framework.

Strengthening of the environmental monitoring capacity along the coastal zone. Development and codification of the SCDP. Formulation of a selected number of local land-use plans for coastal municipalities

and/or communes. Updating the protected area management plan for the Butrint National Park.

14. Component B: Coastal Environmental Infrastructure and Rehabilitation. The

objective of this component was to assist southern coastal municipalities and communes to preserve, protect, and enhance coastal natural resources and cultural assets, leading to improvements in the environmental conditions of the coastal area and encouraging community support for sustainable coastal zone management. Specific physical investments were to be processed on a rolling basis under the SCDP and local strategic plans. The eligible physical investments were grouped in four subcomponents.

Subcomponent B.1, Southern Coastal Solid Waste Management, provided support for: Improved solid waste management in the southern coast zone to reduce the amount

of unattended waste and construction debris, targeting collection and proper disposal in the landfill infrastructure.

Construction of solid waste landfill infrastructure in Saranda and Himara and equipment to operate the landfills to service communities of the southern coast.

Subcomponent B.2, Saranda Water Supply and Sewage Improvements, supported improvements in water supply and sewage systems in the tourist area of Saranda town.

21

Subcomponent B.3, Saranda Gateway, supported the transformation of Port of Saranda into a dedicated ferryboat and passenger terminal to facilitate large passenger boats’ access to south Albania.

Subcomponent B.4, Coastal Village Conservation and Development Program (CVCDP), offered financial and other forms of support to (a) local governments and communes on the Ionian coast for the implementation of subprojects to improve public utility infrastructure and to protect and enhance environmental and cultural heritage, supporting sustainable tourism development and revitalizing traditional architectural heritage; and to (b) communes surrounding the Butrint National Park to promote environmental protection and sustainable economic activities.

15. Component C: Porto Romano Hot-Spot Clean-up. The objective of this component was to contain soil and groundwater contamination in the former chemical plant at Porto Romano, on the outskirts of Durres, considered one of the most seriously contaminated locations in the Balkans. Component C comprised five subcomponents: (i) capacity building and awareness raising on hazardous waste management; (ii) environmental monitoring; (iii) remediation and clean-up works; (iv) land-use planning; and (v) resettlement plan implementation. The project was expected to build capacity on hot-spot management within the Ministry of Environment, which could be further applied to deal with other critical hot-spots throughout the country; it was also designed to support community awareness-raising activities around the Porto Romano site focusing on reducing environmental health risks. Specifically, the component included: Capacity building in hot-spot management and community awareness. Establishment of a long-term environmental monitoring system. Carrying out critical remediation and clean-up works. Establishment of a model for dealing with the clean-up of hazardous hot-spots that

could be replicated in other hot-spots along the coast. 16. Component D: Project Management and Monitoring. This component aimed to

support project management, coordination, and monitoring and evaluation by financing technical assistance, office equipment and furniture, training, and incremental operational costs. It included three subcomponents: (i) project coordination support; (ii) project implementation support; and (iii) project monitoring, evaluation, and communication support.

1.6 Revised Components after Restructuring 17. Restructuring resulted in dropping project activities related to strategic policy

support and land-use planning. During the restructuring, and to take forward the recommendations of the Management Action Plan (MAP) prepared under the IP case, some components remained largely unchanged, some were changed, and some were completely dropped, leading to revised cost estimates (see Tables 1 and 2).

22

Component A of the original project, which focused on enhancing the capacity of the Albanian authorities to manage coastal land resources, was modified, and its two subcomponents (Subcomponent A.1, Strategic Policy Support, and Subcomponent A.2, Coastal Management Strengthening) were dropped. Under the Environmental Management Strengthening subcomponent (A.2.d.), certain equipment had already been purchased and installed to strengthen environmental monitoring functions in Albania; the remaining IDA resources for this subcomponent were reallocated to other activities.

Component B, which supported rehabilitation of coastal environmental infrastructure, was retained. Subcomponent B.4, on village infrastructure, was simplified and the community benefits of infrastructure projects were reemphasized. On the basis of the lessons learned from the implementation of Phase 1 of the CVCDP (EU grant), the criteria for eligibility for project financial support for village investments (e.g., road rehabilitation, village water supply) were modified to emphasize that infrastructure improvements would have to benefit the entire community and not trigger new urban developments. Future rounds of subprojects were channeled through the Urban Planning Department of the Ministry of Public Works, Transport and Telecommunications. The counterpart contribution from local beneficiaries (municipality/commune/ community) was reduced from 20 percent to 10 percent of the total cost of the investment. Activities for promoting environmental protection and sustainable economic activities under component B.4 b related to communes surrounding the Butrint National Park were dropped at project restructuring because of the approaching closing date of the GEF grant (September 2010).

The support for local land-use planning under Component C was also dropped. 1.7 Other Significant Changes 18. Originally designed as a two-phase APL to be implemented over 7 years, the

project was changed to a single-phase investment lending operation during restructuring. The total cost estimate of the two-phase APL was US$66.5 million (Phase 1 US$38.56 million and Phase 2 US$27.94 million). Phase 1 (September 2005-August 2009) was expected to focus on the operational strategies, institutional capacity strengthening for improved land-use management, and coastal environmental infrastructure and rehabilitation, as well as remediation of the Porto Romano hazardous hot-spot in Durres. Phase 2 (January 2009-August 2012) was expected to build on the initial results of Phase 1 and provide further investment support for the basic infrastructure that is needed for tourism development. However, during the restructuring, Phase 2 was dropped and the project was changed to a single-phase investment lending operation.

19. The Level 1 Restructuring dropped the policy and planning aspects in the original

project design. The Bank team had a series of intense and difficult consultation meetings with senior government officials during the 17 months of the IP investigation. It was recognized that many institutions responsible for land-use planning and land development in Albania did not have adequate planning, regulatory, and enforcement

23

capacity to effectively implement zoning regulations and deal with the pressures of unregulated development. In view of the complex political economy, the government needed more time to forge a political consensus and develop a regulatory framework and institutional mechanisms to balance the opportunity of tourism development with the need to protect the southern coast. Therefore, it was agreed that the restructured project should focus on addressing the gaps in key environmental and coastal infrastructure and support coastal communities in improving the quality of tourism services. In doing so, some elements of sustainability of project investments were left to rely on efforts by the government to forge a coherent policy and planning framework.

20. In addition to the major Level 1 restructuring in 2010, the project benefited from

three minor Level 2 restructurings in 2011, 2012 and 2014, focused on extending the project timeline and reallocating funds among disbursement categories in conjunction with administrative changes on the borrower’s side affecting the project. The project closed on March 31, 2015.

24

Table 1. Changes to Components and Activities

NO. Original component Revised component Explanation

1 Component A: Integrated Coastal Zone Management Policy and Institutional Capacity Building Subcomponent A.1, Strategic Policy Support, was expected to provide TA supporting the development of the policy and legal framework for ICZM and the development of a financial and economic incentive framework for ICZM. Subcomponent A.2, Coastal Management Strengthening, was to support increasing the efficiency and effectiveness of the regulatory, planning, and management functions for ICZM. Activities included (a) Regulatory capacity (b) Capacity building for resolution of disputes (c) ICZM capacity (d) Environmental management strengthening (e) Protected areas management strengthening (f) Land-use and spatial planning strengthening

Component A: Protected Areas Management Strengthening. All activities under Subcomponents A.1 and A.2 were dropped, except Subcomponent A.2 (e), Protected Areas Management Strengthening. Subcomponent A.2 (e), Protected Area Management Strengthening, was downsized. Only technical assistance for the management of Butrint National Park was retained.

Project support for land- use planning was dropped pursuant to the proceedings of the IP and actions foreseen in the MAP. The justification was to refocus the project on municipal and environmental infrastructure and simplify implementation. GEF grant implementation was very slow and the grant was closing in September 2010. The main GEF grant activity focused on preparing the Butrint Park Management Plan and strengthening the role of local communities in the process.

2 Component B: Coastal Environmental Infrastructure and Rehabilitation Subcomponent B.1, Southern Coastal Solid Waste Management, was to finance the construction of two municipal landfills in Saranda and Himara.

Component B: Coastal Environmental Infrastructure and Rehabilitation Subcomponent B.1, Southern Coastal Solid Waste Management: the proposed landfill facility at Himara was changed to a transfer station because a smaller quantity of waste was being generated. The subcomponent aimed to

25


Subcomponent B.2, Saranda Gateway, supported improvement of Saranda’s downtown port into a dedicated ferryboat and passenger terminal to facilitate the access of passengers and vehicles to south Albania. Subcomponent B.3, Sewer and Water Supply in Saranda Tourist Area, supported the extension of the sewer and water supply systems and roads surface works. Subcomponent B.4, Coastal Village Conservation and Development Program, was designed to target coastal communes/villages located on the Ionian Sea coast and villages adjacent to the Butrint National Park for infrastructure improvements, environmental protection and sustainable economic activities, and capacity building and technical assistance.

support a review of regulatory issues related to the operation and management of landfill facilities. TA for a review of issues related to construction and demolition waste, including its removal and prevention of illegal dumping, was foreseen. Subcomponent B.2 remained unchanged. Subcomponent B.3 was insignificantly modified to support more focused investments to improve the water supply system and rehabilitate the sewerage network of Saranda’s new tourist areas, and to take into account the investments under GoA’s agreement with KfW for improving Saranda’s water supply. Changes were made to eligibility criteria emphasizing that investments have to benefit the entire community and not trigger new urban development. The community contribution was reduced to 10%. The restructuring included a small pilot R&F Program to support rehabilitation of dwellings in traditional villages in a way that is representative of the vernacular architectural value. The R&F aimed to rekindle appreciation of local architectural traditions. The capacity-building TA was modified to support implementation of these subcomponents. Activities under component B.4 b related to promoting environmental protection and sustainable economic activities in communes surrounding the Butrint National Park were dropped.

26


Component C: Porto Romano Hot-Spot Clean-Up. Subcomponent C.1, Strengthening Implementation Capacity, provided TA for investigating the soil and groundwater pollution at the Durres site, and for strengthening capacity within the MoE to launch the clean-up activities. Subcomponent C.2, Hydrogeological and Environmental Monitoring. Subcomponent C.3, Remediation and Rehabilitation Works. Subcomponent C.4, Resettlement Action Plan Implementation. Subcomponent C.5, Land-Use and Management Plan for Porto Romano, to support the development of a participatory land-use and management plan for Porto Romano to assist the Durres Municipality and Porto Romano communities.

Activities under Component C to support remediation and containment of hazardous pollution in the former chemical factory at Porto Romano remained largely unchanged. It was decided that no land-use plan would be prepared under the restructured project for the area of Porto Romano. Instead, activities focusing on community awareness of the nature of health hazards and clean-up up objectives, and on care of the site after clean-up, were expanded.

Project support for land-use planning was dropped pursuant to the proceedings of the IP and actions foreseen in the MAP.

Component D: Project Management and Monitoring to support project management, coordination, monitoring and evaluation. Component D includes three subcomponents: (i) project coordination support; (ii) project implementation support; and (iii) and project monitoring, evaluation, and communication support.

Component D: Project Management and Monitoring No major changes took place under the restructuring. Some new positions in the project coordination unit were created to bring in engineering skills and expertise in accounting, procurement, and architecture/urban planning.

Preparation of the second phase of the APL as an activity under the project was not included under the restructured project.

27

Table 2. Cost Allocations Resulting from Restructuring

Original (US$ mil) Restructured (US$ mil)

Component IDA Cofinancing grants

GoA Local communes

IDA Cofinancing grants

GoA Local communes

A Protected Areas Management Strengthening (formerly named Integrated Coastal Zone Management)

2.1 0.9 0.25 0.00 1.2 0.5 0.25 0.00

B Coastal Environmental Infrastructure and Rehabilitation

14.1 9.3 4.58 1.26 14.5 6.4 4.58 1.26

C Porto Romano Hot-spot Clean-up

0.2 3.4 0.88 0.00 0.1 3.3 0.88 0.00

D Project Management and Monitoring

1.1 0.4 0.00 0.00 1.7 0.4 0.00 0.00

Total 17.5 14 5.71 1.26 17.5 10.6 5.71 1.26

28

2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design, and Quality at Entry 21. In addition to sound background analysis which led to a clear articulation of

relevant project objectives, a broad variety of lessons and risks were assessed during project preparation. However appropriate mitigation measures were not always included in the project design. Other risks—such as the political economy context of the country’s coastal zone development, institutional mechanisms and hierarchy, organization capacity, and component design—were underestimated.

(a) Country Strategy and priorities aligned with ICZM. The background analysis

that supported the project design was aligned with the Albania CZMP and the CAS for Albania that was prepared in May 2002. The project was meant to contribute to achieving the overarching goal of poverty reduction by developing institutional capacity for protecting coastal and marine natural resources, increasing access to basic services associated with improvements in quality of life, and promoting a sustainable and regulated tourism sector development in Albania. More specifically, the project was intended to support the policy reform, institutional capacity building, and infrastructure investments required to sustain the country’s unique natural and cultural assets. At entry, the objectives of the project were aligned with the Government’s objectives to tap the potential for tourism and strengthen the country’s governance, land-use management, and environmental remediation efforts, which would contribute to economic growth and poverty alleviation. The project objectives of improved coastal zone management were also well aligned with Albania’s plan for greater integration with the European Union.

(b) Assessment of project design. The project objectives were clear, realistic,

important for the country and sector, and consistent with the Bank’s CAS. However, an assessment of project design at entry, including its realism and the degree of complexity, indicates that the team underestimated the risks associated with the multiplicity of organizations, the number of project components and their geographic dispersion, the capacity of the implementing agencies, and social and environmental factors. Outcome indicators were also numerous and poorly defined, often lacking baselines.

(c) External factors, outside the scope of project, affected objectives, components,

and organization after restructuring. The restructured PDO and components focused on a more pragmatic outcome for which the project could reasonably be held accountable, given its duration, resources, and approach. However, the sustainability aspects of the restructured PDO depended on efforts outside the scope of the operation, which did not always perform satisfactorily. With the benefit of hindsight it is evident that the project objectives were relevant to GoA’s priorities but were overly demanding, i.e. not always in line with the institutional capacity of implementing agencies.

29

(d) Complex political economy and limited institutional capacity for multi-stakeholder engagement created substantial implementation risks despite efforts to integrate lessons from other countries into project design. The project design incorporated lessons from several Bank-financed ICZM initiatives in other countries. It was informed by knowledge that capacity-building interventions without investments often do not accomplish much. The benefit of stakeholder involvement as a key to success was integrated into the design of project components. While the Bank team emphasized the need to reflect multi-stakeholder consensus at different levels of government in the institutional framework for ICZM, project implementation was affected by unpredictable personnel changes, both at PCU level as well as at local and municipal levels, which resulted in delays in re-establishing consensus. Decisions were often made in the absence of full consensus among the several agencies and actors operating on the coast about the new rules of the game. Nevertheless, the fact that the project aimed at bringing stakeholders together for inclusive decisions on investment priorities primarily in communes and villages was particularly noted positively in the beneficiary survey. The team also appears to have underestimated the risk of implementation delays due to the lack of institutional understanding of the principle of fair compensation for forced relocation of people, and the risk of procurement-related challenges.

(e) Cumulative risks associated with the power-sharing arrangements and the

shared mandate between horizontal and vertical ICZM institutions. The project design was informed by the fact that authorities at different levels of administration do not always share power (from the central to the regional level, from the regional to local governments, and from local governments to villages and communities). Lack of coordination of disparate functions such as planning and zoning, administrative processes for issuing construction permits, budgeting, and development affected implementation quality. The project appraisal underestimated the high cumulative risks incurred when so many institutions from different levels of government are involved in a project. However, such risks might be unavoidable where capacity issues of local self-government are not addressed and multiple agencies are responsible for a coastal zone with a large concentration of people and business interests. These risks continued to affect implementation and were mitigated to the extent possible only during implementation, so that delays accumulated.

(f) Unfinished land reform and complex and inconsistent property laws enhanced

the risks in the Albanian coastal area. The project appraisal noted the demographic pressures exerted by migration and its relation to unregulated development and the lack of adequate infrastructure, compounded by the inadequate institutional framework for ICZM and weak territorial governance capacity. With the benefit of hindsight, it seems that the project design was overambitious, and that the team did not recognize its limited leverage and the inability of relevant Government agencies to address complexities related to land-use planning in Albania. Although the issues related to land ownership were studied and analyzed as part of preparation, the team underestimated the risks associated

30

with Albania’s numerous laws on property and its unfinished land reform. The team realized as soon as implementation started, the complexities resulting from processes such as a mass property privatization and the issuance of hundreds of thousands of documents creating legal property rights, which created a havoc of overlaps, multiple ownership claims, and legal disputes. Multiple laws and relatively fewer regulations, compounded by weak institutions and high informal-level activities in the construction sector, created an unmanageable level of risk. This challenge was increased when the Government resorted to a nationwide program of involuntary demolitions to control unregulated construction without having in place a mechanism to help vulnerable populations cope with the loss of their dwelling.

(g) Lack of preparedness to address the risks associated with the demolition of

illegal buildings. The original PAD noted that the Government had been implementing a program to remove unauthorized encroachments from public spaces in many regions of the country, including the coastal zone. It recorded that the demolition of unauthorized structures had started in 2001 and covered areas in Tirana, Durres, Shkodra, and Korca as well as Himara and Saranda. The team seem to have underestimated the critical social risks, mentioning in the PAD that the “country does not target removing encroachments from specific locations for the purpose of promoting investments, and it is a process that is likely to continue regardless of the Bank’s involvement in the Project.” The PAD also noted that the objectives of this campaign—“to vacate public lands that may have been illegally occupied—are consistent with the objectives of the land-use planning activities supported under the Project.” Under those circumstances the team seems to have underestimated the challenges of land availability for public infrastructure investments. This challenge had to be addressed as an ongoing concern until the restructuring in 2010, after the IP investigation, when the activity related to land-use planning was dropped.

(h) Partnership with donors worked smoothly before and after the IP

investigation. The project worked collaboratively with a large number of donor organizations engaged in ICZM-related activities. The team realized in the early stages of project preparation that working in partnership with multilateral and bilateral organizations is not only desirable but indeed necessary for ensuring that donor activities are compatible and not mutually exclusive. A country-led process to coordinate donor activities and commitments to ICZM in line with a common action plan was initiated, and project implementation was carried out in close collaboration with all cofinancing donors.

(i) Changing the project design from a two-phase APL to a single-phase investment loan better matched the client’s institutional capacity to implement, but reduced the Bank’s ability to manage several sector risks over a longer term. During the IP case the team realized the significant political economy challenges associated with land-use policies and management in Albania’s southern coast and therefore shifted the project focus away from what had been envisaged.

31

Changing the project focus also allowed the team to mitigate the risks associated with unplanned demolition in the coastal areas and to concentrate on short-term and measurable results. The decision to continue with a single-phase investment served as an exit strategy to reduce future implementation risks. At the same time, shifting from a two phase APL and removing all components linked to land use planning limited the Bank’s ability to engage on these issues.

2.2 Implementation 22. There was a delay in meeting effectiveness conditions and a slow start to

implementation. The schedule of project preparation, which started in 2003, was affected by the GoA’s January 2004 decision to delay the formulation and approval of the SCDP. 10 The project financing was approved on June 21, 2005, and a new Government came to power on July 3, 2005. It took some time for the Government to meet the effectiveness conditions—adoption of the Operational Manual, a legal opinion on ratification of the Development Credit Agreement, and appointment of such bodies as the Project Steering Committee and the project coordination unit (PCU). The project became effective on November 29, 2005, and started slowly, as the low level of disbursements during the first six months would indicate. Initial work included feasibility studies, EIAs, and detailed engineering designs. A number of preparatory activities for components were postponed for completion during implementation. The national elections of July 3, 2005 led to a change in the Government causing further delay in implementation as many officials responsible for project implementation, including the Project Coordinator of the PCU were changed by the new Government.

23. According to the original design, the overall institutional coordination was assigned to the Ministry of Public Works, Transport and Telecommunications (MoPWTT). A PCU was set up within the MoPWTT to be responsible for overall project coordination, procurement, financial management, disbursement, monitoring and evaluation, and reporting. A Project Steering Committee was set up to provide

10 Under the Integrated Coastal Zone Management and Institutional Capacity Building, the Southern Coastal Development Plan (SCDP), a regional territorial land-use plan, was developed with wide consultation with beneficiaries. The plan aimed to promote sustainable natural resource management and cultural heritage preservation, while minimizing the negative environmental impacts of local development and infrastructure. It was approved by the National Council of Territorial Adjustment on July 17, 2008. The SCDP was based on the European Code of Conduct for Coastal Zones, which adopted principles from the Pan-European Biological and Landscape Diversity Strategy, which defines key elements relating to development and management of coastal zones and is an instrument to promote more sustainable tourism as a principal catalyst for economic growth in the regional economy. Following the launch of the SCDP, Local Development Plans

(including land-use plans) were expected to be prepared under the Project for the six municipalities and communes in the Southern Coastal Area that would allow municipalities and communes to improve their land-use planning regulations and issue building permits based on transparent building regulations and clear land-use zoning. However, these Local Development Plans were dropped during the project restructuring of March 2010; it was decided not to finance them under the ICZMCP but to leave them to be financed directly and separately by the Government of Albania.

32

project oversight, review project progress, and resolve obstacles to project implementation. Project implementation was carried out by entities at the central, regional, and local levels: the MoPWTT, the Ministry of Environment, the Ministry of Culture, Youth and Sports, and various municipalities and communes.

24. A difficult IP investigation11 that began within 2.5 years after effectiveness halted disbursements. Residents of Jale village, whose dwellings had been demolished by the Albanian Construction Police in April 2007, filed several complaints, and on January 9, 2009, the IP opened an investigation that resulted in a 17-month suspension of project disbursements. Most planned project activities on the ground were halted, affecting core PCU staff, many of whom left during the suspension period. The only activities undertaken during this period were consultancies such as engineering design and works on the Porto Romano contamination clean-up financed by the Dutch Government. The project had disbursed only around 25 percent before the investigation, and disbursements remained at the same levels until the completion of the IP investigation in early 2010. During the project suspension period the IP carried out in-depth investigation and review, and Bank entered into extremely detailed deliberation with officials at the highest levels of the Albanian Government to develop and agree on remedial measures that would address shortcomings in the project design and strengthen implementation arrangements. A MAP in response to the IP investigation was implemented in conjunction with the resumed project activities. It required payment for, and independent monitoring of, the legal cases of the owners whose houses were demolished, which were being handled by the Albanian judiciary.12 Four Progress Reports on the implementation of the MAP were submitted to the Board of Executive Directors. The activities that were fully completed before the 2010 restructuring included consultancies for the preparation and adoption of the SCDP with wide public participation, the purchase of equipment for monitoring of the coastal waters, and feasibility studies.

25. The restructuring in March 2010 simplified to some extent the project design. The

Board approved the Level 1 restructured project on March 22, 2010, and extended the closing from the original date of March 31, 2010, to December 31, 2012. There were no changes to the original IDA allocation for the project or to the cofinancing from the Government of the Netherlands, the PHRD implementation grant from the Government of Japan, the Global Environment Facility (GEF), and the Austrian Government. The restructured project focused on supporting critical coastal and environmental

11 ICZMCP was approved by the Board of Executive Directors on June 21, 2005. On November 1, 2007, the Executive Directors of the World Bank authorized an IP investigation of the Project relating to the demolition of 15 buildings in the community of Jale in April 2007. The Management Report and Recommendations in Response to Inspection Panel Report (INSP/R2008-004/2) identified a series of errors arising from project preparation and supervision and proposed a MAP to address these issues.

12 The legal process is ongoing, and the Bank continues to provide funding to support it.

33

infrastructure for coastal development and tourism. The original implementation arrangements remained intact. The PDO was revised and linked mainly to outputs focusing on large infrastructure: rehabilitation of the Saranda Gateway (passenger port terminal); support for water supply and sanitation in Saranda; and a sanitary solid waste landfill and transfer station and small community infrastructure, such as roads and village squares and water supply schemes to meet the critical infrastructure needs of coastal communities. The project promoted vernacular architectural traditions through a small pilot for rehabilitation of roofs and facades in these villages. All urban planning activities were excluded from the restructured project.

26. Project disbursements resumed in June 2010, but weak institutional capacity and a lack of readiness for infrastructure investments slowed the pace of implementation. The 2010 restructuring did not accelerate the pace of implementation as soon as expected. The main reasons for slow implementation were lack of procurement and contracting readiness of infrastructure investments, and delay in the procurement of consulting services for environmental and social assessments. Preparation of and consultations on the environmental and social assessments and resettlement action plans for the infrastructure investments took much longer than expected because multiple levels of administrative approvals were required before execution could be authorized. Additional time was added by the lengthy procedures for obtaining construction permits. Project implementation performance varied from unsatisfactory to moderately unsatisfactory and moderately satisfactory.

27. The 2010 restructuring did not fully succeed in reducing project complexity and simplifying implementation. The restructured project was implemented under the direct responsibility of the MoPWTT as the lead agency, through the PCU. The MoPWTT remained responsible for project coordination, financial management, procurement and contract management, disbursements, monitoring, evaluation, and reporting. The Deputy Minister who served as the Project Authorizing Official representing MoPWTT was assigned the oversight responsibility for the PCU with additional technical, procurement, and financial management experts. The restructured project aimed to improve technical advisory services and public outreach, including providing additional oversight on behalf of the Government of Albania by the Project Steering Committee. The membership of the Project Steering Committee was expanded to include representatives of the Municipalities of Durres, Himara, and Saranda—the main beneficiaries of project investments. All these changes in the project’s institutional arrangements (summarized in Table 3) enhanced the quality of reviews but had limited effect on the efficiency or speed of decision-making. In addition, as a result of the IP investigation, the project was subject to additional scrutiny at every stage by multiple layers of institutions.

34

Table 3. SUMMARY OF RESTRUCTURING SCHEDULES, SCOPE, AND CHANGES

Restructuring date(s)

ISR ratings at

restructuring

Amount disbursed at restructuring

($million)

Key changes (as approved)

DO IP 03/22/2010 MU U 4.00 Level 1 restructuring

(i) PDO revised to focus on support for critical infrastructure for improving environmental and sanitary conditions essential for long-term coastal development and tourism.

(ii) Results framework revised and updated to reflect changes made during project restructuring (e.g., land-use planning activities dropped).

(iii) Extension of the project closing date from March 31, 2010, to December 31, 2012.

(iv) Deadline for completing transfer of legal ownership and registering title of properties for the resettled families, pursuant to the Resettlement Action Plan (RAP), extended to June 30, 2010.

01/28/2011 MS MS 5.29 Level 2 restructuring Amendment of Development Credit Agreement covenant to allow the borrower to complete the legal process and extend to June 30, 2011, the deadline for completing the transfer of legal ownership and registration of title of properties for the resettled families in Porto Romano (as per RAP, dated 2005).

11/21/2012

MS MS 7.35 Level 2 restructuring (i) Extension of the project closing date

from December 31, 2012, to June 30, 2014.

(ii) Reallocation of IDA credit funds among disbursement categories.

(iii) Change in the percentage of expenditure to be financed for categories “Works” and “IOC” to bridge the anticipated IDA credit shortfall.

06/13/2014

MU MS 11.96 Level 2 restructuring (i) Extension of the project closing date

from June 30, 2014, to March 31, 2015.

(ii) Reallocation of IDA credit funds among some disbursement categories.

35

28. Notable delays in procurement of civil works were identified during and after the midterm review in November 2012. The midterm review prompted another restructuring to reallocate IDA proceeds among disbursement categories and to factor in the results of detailed feasibility and engineering designs. Further delays occurred late in the project as a result of the institutional and administrative changes following the general elections in June 2013. Because of an institutional reorganization, the ICZMCP and all related responsibilities were transferred to a new ministry—the Ministry of Urban Development and Tourism (MoUDT). It took considerable time to set up all administrative arrangements and initiate effective actions on behalf of the new administration. Consequently, disbursement slowed for about six months. Also, efforts at acquisition of private properties required for construction of the sanitary landfill were slowed by a difficult and prolonged process of consultation and negotiation with the owners. The civil works that had started in July 2013 had to be stopped in November 2013 for the negotiations to be completed. Two changes in the location of the transfer station in Himara also necessitated updating the EIA and reissuing permits before commencing civil works—another source of delays.

29. During the 2010 restructuring, various risks were reevaluated and significant changes to improve effectiveness were identified for subsequent implementation. Some of these risks and their mitigation measures included:

(a) Risk that requesters affected by the April 2007 demolitions would not get a full and free hearing in the court system. The Bank team paid significant attention to the legal review process covenanted in the amended legal agreement, monitoring the process continuously during implementation.

(b) Delays in implementation of the Social Vulnerability Assessment. The Bank team intensified its engagement with the GoA during implementation by allocating dedicated budget and including the assessment as a legal covenant in the revised Credit Agreement.

(c) Transfer of ownership of the apartments to the entitled families. The Bank intensified its monitoring of the completion of Resettlement Action Plans as covenanted in the legal agreement for the restructured project.

(d) Reencroachment of squatters in the remediated Porto Romano site. The Bank team included special provisions in the contracts for remediation of the contaminated site: fencing the construction site to prevent access and secondary contamination in the adjacent area; securing the site and providing information in the community about health hazards during construction; and requiring that before site commissioning, the Ministry of Environment, Forest and Water Management reach agreement with Durres Municipality on implementation arrangements and responsibility for after-care and continuous monitoring of the site .

(e) Delay in the operation of Bajkaj landfill due to limited in-country commercial capacity for operation of sanitary landfill facility. It was agreed with the PCU to hire a transaction advisor to prepare the commercial operation of the landfill facility and institutionalize the commercial operation of the landfill.

(f) Limited community buy-in for the second round of the CVCDP, especially the R&F pilot program and B&B services. It was agreed with Vlora IT to hire

36

additional specialists to expand the community mobilization assistance and improve the implementation of R&F and B&B pilots, drawing on the lessons of the first round.

30. The 2010 restructuring provided an opportunity to refocus the project on specific community infrastructure activities, such as construction of a municipal solid waste landfill. The project identified significant risks associated with timely initiation of the operation of municipal waste landfill facilities. This activity needed timely procurement, quality in compliance with EU environmental standards, and ensured financial sustainability of investments. The restructured project addressed issues such as design complexity and the implementation of social safeguards. It expanded coastal community involvement in the implementation arrangements

31. During the period of suspension of disbursements (January 2009-June 2010), progress was made in the technical preparation of investments. From 2007 to 2010 the project suffered major setbacks, including loss of motivation and momentum. However, the project team deserves credit for completing construction of 12 coastal community-based infrastructure projects, including five water supply systems and seven rural roads projects, and for continuing various activities to improve the readiness for procurement and disbursement, which resumed after approval of the project restructuring: (a) completion of the detailed engineering design, bidding documents, and EIA for the investments in the Port of Saranda; (b) site investigations, detailed design work, and EIA for the solid waste landfill near Saranda and transfer station in Himara; (c) detailed design and EIA of investments for remediation and containment of pollution hazards in the former chemical plant in Porto Romano, and contract award for remediation works and for construction supervision; (d) finalized detailed design for water supply and sanitation investments in Saranda; and (e) preparation for the launch of the Management Plan for the Butrint National Park and completion of the consultancy for the social and legal assessment.

32. Project implementation did not improve immediately after the March 2010 restructuring but picked up significantly in the last two years before project closure in March 2015. In spite of the team’s effort to improve readiness for accelerated implementation, there were delays in procurement and contracting of most infrastructure investments. The last restructuring in June 2014 provided an extension of the closing date until March 31, 2015, and time for completing the construction of the landfill and transfer station and water supply systems work, which had been slowed by winter weather. Following that, project implementation made significant progress. By project closing in March 2015, most infrastructure investments were successfully completed:

(a) The Gateway of Saranda: the passenger port terminal was completed with a new quay wall of 180 m and 9 m depth.

(b) The Bajkaj Regional Landfill and the transfer station in Himara were completed, providing waste disposal capacity for Saranda and Himara municipalities.

37

(c) The water supply and sanitation works were completed in Saranda to cater to the new tourist areas.

(d) All village infrastructure investments agreed with communities in Phase 2 of the CVCDP were completed: nine village roads rehabilitation projects and five village water supply investments.

(e) The solid waste management company for the operation of the landfill was legally established, equipment for operation of the facility was delivered, and staff were trained.

2.3 Monitoring and Evaluation (M&E) Design, Implementation, and Utilization 33. A complex M&E design prior to the 2010 restructuring. The original PAD (Annex

3 – Results Framework and Monitoring dated 05/25/2005) indicates that the original list of sixteen Outcome Indicators were part of the Results Framework for tracking progress toward achieving the PDO. However, Annex 3 (“Arrangement for Results Monitoring”) has a significant level of inconsistency with the main body of the PAD, and lists a total of eleven Outcome Indicators. For example, seven out of sixteen Outcome Indicators were excluded in the monitoring arrangements, and one new indicator was added in the monitoring arrangement (which was not listed as an Outcome Indicator). These sixteen Outcome Indicators are supported by sixteen additional Intermediate Results Indicators distributed across all components. For example, Component 1 includes eight Intermediate Outcome Indicators; Component 2 includes three Intermediate Outcome Indicators; Component 3 includes three Intermediate Outcome Indicators; and Component 4 includes two Intermediate Outcome Indicators. The original framework not only reflects a highly complex M&E design, but a closer look reveals that none of these indicators had baseline information, as the baseline data were expected to be generated through surveys during the first to third year of project implementation. There are no evidences to indicate that these baseline surveys were undertaken. Many of the original set of indicators were inadequate to monitor progress towards the PDO, in view of weak collection methods and unavailability of baseline data. This suggests lack of proper due diligence in data collection and planning for results monitoring. Many indicators in the original project were related to completion of specific outputs (such as approval of the SCDP and approval of the Management Plan for Butrint National Park), with no clear attribution to outcome indicators.

34. A simpler M&E design and implementation after restructuring in March 2010. The Level 1 restructuring resulted in a simpler M&E design for the project, which was monitored and measured during the project implementation. As a result of the restructuring, achievement of the PDO was measured through a set of six key performance indicators, for most of which the baseline conditions were assumed to be zero. M&E implementation both before and after restructuring is assessed to be inadequate due to insufficient efforts in data collection and data quality. These indicators were expressed and measured by the physical outputs of the restructured project: (a) newly built waste landfill and transfer station capacity to service the population of the southern coast (capacity in cubic meters); (b) improvement of the water supply and

38

sewerage system in Saranda; (c) increased access for international tourists and cruise liners to the southern coast; (d) remediation of contaminated sites through removal and containment of hazardous materials in Porto Romano to reduce human health hazards; (e) community-based investments in coastal villages to improve environmental infrastructure and enable sustainable tourism development in the southern coast; and (f) protection and promotion of vernacular architecture of villages in the southern coast. The overall responsibility for project M&E was assigned to the PCU, which was supported by two implementation teams for the CVCDP (Vlora IT) and Porto Romano activities (Porto Romano IT). M&E reporting was done through quarterly and annual progress reports that described progress on physical outputs and provided financial and procurement information.

35. The restructuring paper (Annex 4 – Results Framework and Monitoring, dated

March 8, 2010) outlines a list of 26 Intermediate Outcome Indicators distributed across each component, as below.

Component A:

1. Development and approval of the Protected Areas Management Plan for Butrint National Park with wide stakeholder participation and consultations

2. Social Assessment of the Butrint Management Plan completed. 3. Park infrastructure to enhance biodiversity values of the park constructed.

Component B1, B2, B3

1. Improved waste disposal infrastructure for the Southern Coast built in Saranda with a capacity of 25,000 m3 per year and the accompanying transfer station in Himare.

2. Service contract signed with participating municipalities and communes for waste disposal.

3. Contract signed with landfill operator. 4. Execution of environmental impact assessment (EIA) in accordance with EIA

procedures. 5. Rehabilitation of Port of Saranda facilities to facilitate tourism access to the

Southern Coast. 6. Architectural design for Butrint National Park Visitors Center within the Port

area completed. 7. Reconstruction of the water supply and sewer networks in Saranda. 8. Construction of wastewater outlet from the WWTP in Saranda to the Chuka

Channel. 9. 12.5 km Navarica Trunk main replaced and water storage capacity improved,

including an existing reservoir (1000 m3) rehabilitated. Component B4

1. Coastal communities and Local Government Units participate in project identification

39

2. First and second phase of community based investment program implemented under the Coastal Village Conservation and Development Program

3. Implementation of Roof and Facades (R&F) and Bed and Breakfast (B&B) program underway in coastal villages. 35-75 homeowners participate in the R&F Program and 10-20 homeowners participate in the B&B Program.

4. Technical assistance for operation and maintenance of community waste supply systems and roads completed

5. Technical assistance provided for design of R&F and B&B investments. 6. Technical assistance provided for small scale tourism

Component C

1. Risk assessment undertaken for the Porto Romano hot-spot. 2. Resettlement of the families on the former site completed in accordance with the

agreed Resettlement Action Plan and legal titles provided. 3. Landfilling and encapsulation of 45,000 m3 of hazardous waste on one of the

sites. 4. Infrastructure for site monitoring in place. 5. After care program for the Porto Romano site agreed and signed by MoEFWA

and Municipality of Durres Component D 1. Project funds disbursed according to plan, timely and accurate project status reports,

financial and procurement records and timely audits 2. Public awareness on Coastal Area Issues and sustainable protecting natural and

cultural resources and challenges increased 3. Social & Vulnerability Assessment carried out in accordance with agreed Terms of

Reference 36. M&E of the restructured project focused on physical and financial outputs. The

project team used the physical and financial output indicators to supervise the progress of the works and the delivery of infrastructure and services. While the indicators to measure institutional development progress were not strong, the monitoring reports included useful updates on compliance with related covenants and progress of the studies/TA financed by the project. PCU reporting was done through quarterly (or occasionally six-monthly) reports/information and an annual progress report. The Implementation Status and Results Reports (ISRs) were timely and had a comprehensive aide-mémoire attached, and they systematically reported on the physical and financial outputs. .

2.4 Safeguard and Fiduciary Compliance 2.4.1 Procurement 37. The project suffered from persistent procurement delays both before and after

the March 2010 restructuring. The procurement aspects were well designed and generally well supervised, but the implementing agencies’ lack of capacity to

40

adequately follow the procurement schedule and clearance deadlines agreed at appraisal and during restructuring caused inordinate delays. In some cases, the procurement processing agreements made at appraisal were not followed. For example, the award decisions of several contracts were taken beyond the agreed schedules. Regular delays occurred in evaluating the selection of the consultants and contractors for various activities. Most delays could be attributed to the lack of capacity, coordination, and designation of members of the Evaluation Committee from various ministries, local municipalities, and communities. Several rounds of training were provided on the Bank’s Procurement Guidelines, but persistent delays were encountered for CVCDP activities and with representatives of MoPWTT. It look a long time for project entities to recognize critical differences between the Bank’s guidelines and prevailing procurement practices in the Government, as regular requests for procurement clearances were made that the Bank could not approve. This resulted in inordinate delays despite a well-prepared procurement plan and agreements made at appraisal. Contract management was also an issue that contributed to the large cost and time overruns in several cases. Occasionally, technical review of change orders and invoices submitted by contractors took excessive time and caused tension with the PCU, affecting the delivery time schedule. Finally, frequent turnover of procurement staff at the PCU affected the delivery schedule. The project closed with a moderately satisfactory rating on procurement implementation.

2.4.2 Financial Management 38. Financial management was satisfactory for the project both before and after the

March 2010 restructuring. The project experienced some early delays in disbursement because of a delay in the transfer of funds from the Central Government’s designated account (held at the Bank of Albania) to the project account. Generally the project arrangements for disbursement, including accounting, reporting, and auditing, were found to be satisfactory. For project accounting and financial reporting, the project used the accounting software Alpha PMR, which is found to be adequate to meet the Bank’s requirements. Quarterly financial management reports, showing the sources and uses of funds for the project and funds provided under the credit and related grants, were prepared by the PCU and regularly shared with the Bank. The project was audited each year by the auditing firm selected by the Ministry of Finance, which issued an unqualified opinion on the project financial statements.

2.4.3 Environmental Safeguards and Management 39. During project preparation, the World Bank’s safeguard policies were complied

with, but compliance before the IP investigation in 2009 was unsatisfactory because of poor implementation practices. At the concept stage the project was designated as an Environmental Assessment Category FI. It triggered three safeguard policies: OP/BP 4.01, Environmental Assessment; OP/BP 4.11, Cultural Heritage; and OP/BP 4.12, Involuntary Resettlement. An Environmental and Social Safeguards Framework document (ESSF) was prepared through public consultations (including meetings in Orikum and Himara on April 7, 2005, and in Saranda on April 8, 2005); it

41

was approved in April 2005 and duly disclosed; and it was revised in February 2010 (it was re-disclosed in Albania on February 23, 2010, in English and Albanian, and in the InfoShop). The ESSF contained the procedures for implementing environmental and social safeguards and for assessing impacts and mitigation measures, implementation responsibilities, and costs. It was used to ensure that the infrastructure subprojects implemented through the ICZMCP complied with Albania’s laws, regulations, and customs, as well as with the Bank’s Operational Policies. During implementation, component-level and site-specific EIAs with Environmental Management Plans (EMPs) were prepared, discussed with stakeholders, and publicly disclosed. All required safeguard documents, including the ESSF, EMPs, and RAPs, were appropriately prepared, consulted on, and disclosed for the relevant component. However, during supervision, critical safeguards risks, particularly those related to involuntary resettlement and illegal demolition were not carefully managed. These errors in implementing, supervising, and communicating on involuntary resettlement issues were also acknowledged in the MAP following the IP investigation.

40. Safeguards compliance was satisfactory from the March 2010 restructuring until project closure in March 2015. A review of the environmental and social safeguards documents confirms that the environmental due diligence documents were prepared and implemented for all subcomponents. Based on these documents, local environmental permits were obtained according to Albanian environmental regulations. For all project components, the PCU ensured that EMPs were included in the works contractors’ agreements, and no major noncompliance with EMPs occurred during implementation of civil works. Safeguards requirements for small-scale community investments under the CVCDP followed the safeguards provisions as outlined in the Project Operational Manual. The PCU’s capacity to monitor implementation EMPs has increased through targeted capacity building, in which international environmental advisors supported implementation of major infrastructure components. There are some concerns related to follow-on monitoring of the Porto Romano site according to the Aftercare Management and Maintenance Plan (AMMP). These concerns are partially mitigated by the approval/signing of the AMMP by the MoEFWA, Durres Municipality, and Durres Regional Environmental Agency (REA), which are the three parties responsible for budgeting and implementation of the AMMP. In addition, the REA’s legal responsibility for monitoring the disposal sites of contaminated material is spelled out in Albania’s Waste Law. While the monitoring results for the first year of AMMP implementation are in line with targeted site parameters, lack of funding for regular monitoring of the site may affect the REA’s ability to carry out this function.

2.4.4 Social Safeguards and the Lessons from the IP Case 41. The lessons on social safeguards from the ICZMCP are both significant and a

landmark in Bank history. The IP investigation was prompted by the demolition of several houses on the southern coast of Albania, and a claim was received from affected people alleging that the demolitions were linked to the ICZMCP. The requesters claimed that in 2007 the Construction Police of the Municipality of Vlora, in line with the SCDP supported by the World Bank project, totally or partially demolished their

42

permanent residences. The Bank was accused of not carrying out effective supervision to stop or mitigate these violations. The requesters claimed that while there are many similarly situated and built communities in the coastal area, the Construction Police targeted Jale because of the desire of some public officials to clear space for a resort at and around the site of the demolitions while sparing some buildings in Jale. Accordingly, the requesters “accused the government of having special private interests in the area” and the Bank of not performing adequate oversight and monitoring of activities under the SCDP “implemented in collaboration with the Government of Albania and which violated our [requesters’] rights to shelter and adequate housing and the right to a fair trial.” The IP findings highlighted several concerns related to the investigation process, the Operational Policy framework and staff cooperation, the Access to Information policy, misrepresentation of facts, and supervision.

42. Bank Management asserted in its response that there was no direct or indirect linkage between the project and the demolitions that were the basis of the request. The team stated that the demolitions were part of an ongoing Government program started in 2001, and that they could not possibly be linked to the SCDP, which was not in effect at the time of the complaint. Therefore, the team contended that OP 4.12, Involuntary Resettlement, did not apply to land-use planning activities such as the SCDP, and would only apply to possible land acquisition for the purpose of enabling specific infrastructure investments following the adoption of the SCDP. However, the team recognized the need for improvements in relevant country laws and their application and stated that future implementation of the SCDP would include social due diligence measures to protect vulnerable people. The Bank team had recommended to the Government that it mitigate negative impacts, including by (a) defining transparent criteria for identifying illegal buildings for demolition, (b) defining eligibility criteria for assistance, (c) defining a package of assistance, and (d) carrying out public outreach and dissemination efforts. In addition, Management advised the Government to put on hold plans for future demolitions until these criteria were developed and agreed with the Bank.

43. The IP investigation concluded that the initial decision not to apply OP/BP 4.12 at the decisive stage of appraisal and during implementation was a root cause in the mishandling of the Jale demolitions. This, and the failure to effectively safeguard the project through an agreement with the Government to suspend demolitions in the project area, had negative consequences for the affected population and for the Bank’s reputation. The Panel recommended that the Bank should have used the demolitions in Jale to reexamine, with the GoA, the project’s entire approach to demolitions, and to reconsider the applicability of the Bank’s OP/BP 4.12.

44. Management, in its Final Report and Recommendation to the Board, maintained

its position that triggering OP 4.12 was not appropriate in planning exercises such as that supported by the project. Management also acknowledged that the policy was ambiguous on this point and would need to be clarified, and that more systematic and diligent social assessment was critical in such cases. At the same time, however, Management acknowledged “serious errors in project preparation and supervision,

43

along with errors in communication with the Board of the World Bank,” and agreed to carry out a series of measures under a MAP to address the issues identified by the Panel: (a) Bank financial support for the requesters’ legal expenses in a case-by-case legal review of the April 2007 demolitions; (b) the appointment of an independent observer to monitor the legal review and report back to the Bank; and (c) the payment of legal aid for the review of each of the requesters’ claims. The team also agreed to supervise the completion of a Social Vulnerability Assessment, and to apply the resulting assistance packages retroactively for the poor and vulnerable people affected by the demolitions.

45. The IP investigation and Management decision on the ICZMP had a far-reaching effect across the whole Bank Group on how safeguards policies are interpreted and applied in projects (also see Section 6.0, “Lessons Learned”). The ICZMCP prompted Management to clarify the interpretation of OP 4.12 for projects involved in land planning/administration. Management prepared and adopted a guidance note to address environmental and social issues in projects that support land-use planning. Additionally, a footnote13 was introduced into OP 4.12, clarifying the application of the policy in similar situations. Following the outcome of the IP investigation, the Bank Management made a concerted effort to ensure that operational staff were adequately aware of and trained on the Bank’s safeguards policies, including OP 4.12, and that systems were put in place to allow staff to come forward with difficult safeguards issues for collective decision-making on how to handle them. In this way, the lessons acquired during project implementation played a major role across the Bank in improving the implementation and monitoring of the safeguards aspects of complex projects.

46. At project closure in March 2015, there were no outstanding social safeguards

issues.14 There have been no new complaints or community opposition to the landfill construction since April 2014, and the works have been completed. The waste transfer station location selected by Himara Municipality did not involve any economic or physical displacement of population. Regarding property titles for families resettled from Porto Romano, Durres Municipality has completed the process for each family to obtain legal titles. As of March 2015, the families that applied for titles have received titles under existing administrative and legal procedures.

2.5 Post-Completion Operation/Next Phase

13 The revised footnote 8 of OP 4.12 reads as follows: “Land” includes anything growing on or permanently affixed to land, such as buildings and crops. This policy does not apply to disputes between private parties in land titling projects. The policy also does not apply to land use planning activities, or to the regulation of natural resources on a regional, national and/or sub-national level (such as watershed management, groundwater management, fisheries management, coastal zone management, etc.) unless such activities or regulation involve Bank-assisted investments that require the taking of land. It is good practice, however, to conduct a social, legal and institutional assessment in all of the above situations, to help identify potential impacts and risks with a view to minimizing and mitigating adverse economic and social impacts, especially those that affect poor and vulnerable groups. 14 An ongoing separate process linked to legal support to families in Jale is supported under the project.

44

47. The vast majority of the components financed by the project were successfully

completed before project closure in March 2015. However, post-completion/operation is an important phase to ensure the sustainability of the investments financed under the project. For most of these investments, the defect liability period extends beyond the project closure date. This will require close monitoring by the MoUDT.

48. Saranda Gateway—Passenger Port Rehabilitation. The completion of a quay wall has allowed the port to receive large cruise vessels. Following the issuance of a completion certificate, the asset is under a one-year defect liability period (until March 2016). The as-built drawings and other completion documents (i.e., site possession documents, construction permits, site diaries, laboratory test results, water sampling results, material certificates, and photographs at various stages of construction) were submitted to the Port Authority to support the application for international port security certification in line with International Maritime Organization legislation. The port is in full and regular operation.

49. Saranda Water Supply and Sewage. The project investments under the

subcomponent included (a) replacement of the 12.9 km Navarica transmission main, and extension of the 2.35 km distribution network in the tourist area; and (b) construction of an 1.29 km outfall pressure line from the Saranda Wastewater Treatment Plant (WWTP) to the Cuka Channel, including rehabilitation of 2.1 km of sewer lines within the city. The assets’ defect liability period ended in September 2015.

50. Operational commissioning of a nonfunctional WWTP before the high tourist

season. The project expected that Saranda WWTP would soon be functional to support the wastewater channel completed under the ICZMCP. The WWTP was financed under the Albania Integrated Water and Ecosystem Management Project (P075156), supported with resources from the GEF, European Investment Bank, and the Government, and closed on December 31, 2009. Because of missing inflow and outflow connections, the WWTP remained nonoperational for about four years. Trial tests conducted in 2014 showed technical flaws, attributable to weathering and non-use, which had not been addressed at the time of the ICZMCP closure. The use of the Cuka channel is contingent on the WWTP’s becoming operational.

51. Solid waste management and landfill equipment. The solid waste management

investments15 included the regional landfill in Bajkaj, reconstruction of the road from Stjari Bamatati Junction to the National Road Kardhiq-Delvine, a new access road from Kardhiq-Delvine to the landfill, and Himara Transfer Station. The construction works and the installation of gas flaring equipment have been completed. The project was handed over on February 4, 2015, and the works are under a defect liability period until

15 Solid waste investments are financed from an IDA credit (28%), an Austrian Development Grant (42%), and the Government of Albania (30%).

45

2016. The site looks well maintained and guarded. The establishment and registration of the Solid Waste Management Company was completed on November 11, 2014, and a managing director and key staff have been appointed. The Government opted for a business model of a company which is 100 percent owned by Vlora Qark, and represents the state, in line with the upcoming administrative territorial reform and local elections in June 2015. According to the Bank team’s assessment, there is a need to hire an experienced operator or a consultant to advise the company on operational issues, and Vlora Qark is considering this recommendation. Service agreements with all the municipalities in the service area have been signed. Saranda, which is the largest municipality, has already allocated funds for payment of the gate fee in its annual municipal budget.

52. Himara Transfer Station. The works at the transfer station were completed and a

handover letter from the project manager was issued on February 3, 2015, to bring the investments under the defect liability period. A road of 1.2 km connecting the main road with the village of Kudhës urgently needs rehabilitation. While this is not part of the project, the road is important for operation of the transfer station. It is expected that Himara Municipality will take up rehabilitation of the connecting road under the Albania Development Fund.

53. Coastal Village Conservation and Development Program. The two-stage CVCDP

consisted of road, water supply, and sewage subprojects in the villages of the municipalities/communes of the south of Albania. During the first stage, in addition to participating in the process, the beneficiaries and local authorities were required to pay at least 20 percent of subproject costs. Infrastructure investments that were focused on nontraditional villages adjacent to beach areas included road improvements, development of public spaces and parking, and water supplies; in traditional villages, investments were focused on revitalization and enhancement through improved internal paths and squares and street lighting. The beneficiaries under the first round of the CVCDP were the Municipality of Orikum, the Municipality of Himara (and its six villages) and the Commune of Lukova (with its four villages). Investments included in the CVCDP-2 were carried out in 13 villages and included small public infrastructure such as access roads, village squares, and village water supply schemes:

(a) Nine subprojects for rehabilitation of village roads/squares and five subprojects for small water supply systems.

(b) Ten villages, with 18,400 permanent inhabitants and an estimated 24,100 tourists during the summer season (Dhermi, Ilias, Nivice, Piqeras, Ksamil, Xarre, Pllake-Qenurio, Bajkaj, and Palavli), benefited from road/village square investments.

(c) Six villages, with a total of 7,050 inhabitants and an estimated 2,650 tourists in the summer season (Ilias, Palase, Qeparo, Lukove, Bajkaj, and Palavli) benefited from water supply investments.

(d) In addition to the network extension, three reservoirs were rehabilitated (with a capacity of 100 m3 each) in Qeparo, Lukove, and Bajkaj, contributing to increased water availability.

46

54. R&F Rehabilitation. The R&F demonstration pilot was designed to promote tourism in traditional coastal villages by focusing on pockets of vernacular architecture of potential value to attract tourists; under the pilot, minor rehabilitation works are financed through a combination of small grants and owners’ resources. The pilot achieved a major change in local perceptions of and attitudes to the architectural traditions of the region. Villages that participated in the R&F pilot are in the Himara Municipality (Vuno, Ilias, Old Dhermi, Old Himara, Old Qeparo) and in Lukova Commune (Nivice, Piqeras, and Lukst, where 27 houses were completed). The municipalities of Lukova contemplate expanding the R&F pilot with their own funds, using the guidelines prepared under the project for enhancing the traditional architectural quality of homes in the coastal villages.

3. Assessment of Outcomes 3.1 Relevance of Objectives, Design, and Implementation Original Project Rating of Relevance of Objectives, Design and Implementation: Moderate Restructured Project Rating of Relevance of Objectives, Design and Implementation: Substantial 55. The project’s overall objective before and after restructuring, and at exit, remains

consistent with the Government’s priorities—to develop tourism on Albania’s southern coast in a sustainable way. Designing and improving critical public environmental infrastructure and municipal services, remediating and containing pollution hazards from a former chemical plant, and improving community infrastructure and enhancing architectural and cultural resources continue to be valuable and relevant. Albania continues to rely on tourism to boost economic growth and job creation and to attract foreign investments. The ICZMP’s objective is consistent with Albania’s current development priorities and with the Bank’s current country and sectoral assistance strategies and corporate goals. The relevance of both the original and the restructured PDO is rated High.

56. The original project design was too complex, particularly in view of the lack of institutional capacity and political consensus to set up an ICZM approach to reduce coastal degradation through interventions in policy, planning, institutions, and investments. The original activities and policy areas proposed as part of project design seem to be substantially relevant to the objectives. But an unclear statement of objectives provided a relatively weaker linkage to intermediate and final outcomes. Therefore relevance of project design is considered to be Moderate in terms of the quality of the results framework, due to a relatively weak causal chain between funding and outcomes. As has been noted, the original design underwent significant changes as part of restructuring after it became clear that many institutions responsible for land-use planning and land development in Albania lacked planning, regulatory, and enforcement capacity to effectively implement zoning regulations and deal with the pressures of unregulated development. However, some parts of the original design—such as completion of the SCDP in 2008, with a Strategic Environmental Assessment

47

and Management Plan for Butrint National Park—are still considered substantially relevant to the revised project objectives. Relevance of original project design is rated Moderate.

57. The restructured project design is considered to be substantially relevant to the

Government’s ongoing plan to improve critical infrastructure. After the Level 1 restructuring, the project remained consistent with the local priorities of developing tourism on the southern coast of Albania by improving critical public infrastructure and municipal services, and hence improving the environmental and sanitary conditions that are essential for long-term coastal development and tourism. After restructuring, the project design included activities such as completion of many environmental infrastructures in accordance with the National Strategy and Plan for Waste Management, the National Transport Plan, and the Master Plan for Saranda Port. However, the agenda to improve sustainable tourism growth on the Albanian southern coast remains unfinished; despite recent growth in tourism, the sector is facing several challenges to sustaining that growth—most notably, uncontrolled urban growth and lack of building standards, stressed municipal infrastructure, increasing pressure on pristine and fragile nature and habitats, predominantly mass tourism vis-à-vis high-value tourism, and weak regulatory and institutional set-up. According to data from the World Travel and Tourism Council (2013), the tourism industry in Albania has emerged as a significant contributor to growth, with 3.45 million arrivals in 2012—an increase of 25.7 percent over 2011. In 2013 the total contribution of the travel and tourism industry to Albania’s GDP was 22.3 percent, and its contribution to real GDP growth was 6.7 percent. By developing the coastal areas, Albania could attract additional international and domestic tourists, thus increasing the travel and tourism contribution to GDP. Relevance of restructured project design is therefore rated Substantial.

58. The ICZMCP implementation focused on improving environmental infrastructure as a platform for sustainable tourism development on which future Bank support can build. This theme features prominently in the current Country Partnership Framework. Albania has repositioned tourism under the Ministry of Economic Development, Tourism, Trade and Entrepreneurship, has drafted a new Tourism Law, and is focusing on tourism as a strategic economic sector. All this provides an important window of opportunity to drive tourism development in an integrated and private-sector-led manner. The ICZMCP objectives were consistent with the 2006 CAS goals and the Government’s priorities of alleviating rural poverty, providing greater access to infrastructure, deepening the decentralization process, strengthening local government capacities, and increasing the transparency and level of community participation. The original project implementation succeeded in facilitating beneficiaries’ access to basic infrastructure services, and it supported the decentralization and governance agenda by building the capacity of local municipalities to involve communities in development decision-making. To some extent the project implementation also addressed some of the challenges to decentralization, such as low institutional capacity, transparency, and accountability of local governments. However, decentralization of municipal services and fiscal decentralization remains an unfinished

48

agenda. Therefore, relevance of original implementation is rated Moderate as more could have been done to resolve outstanding issues regarding decentralization of fiscal resources and public services.

59. A substantial relevance of the project implementation after restructuring confirms that the project design was suitably modified to reflect on-the-ground reality after the IP case. The restructured objectives (“…developing, on a sustainable basis, tourism in the South Albania coast by improving critical public environmental infrastructure and municipal services…”) provided a robust platform for achieving the country’s and the Bank’s development objectives and a responsive implementation to changing needs and context. The restructured project implementation in many ways aimed to address the design errors acknowledged in the MAP. It dropped land-use activities that continued to present substantial risk because of limited institutional capacity; refocused the project support to bridge critical infrastructure gaps impeding coastal tourism (e.g., lack of access roads, passenger port facilities, and environmental infrastructure for municipal waste, water supply, and wastewater); increased local community involvement in project implementation; and demonstrated the value of preserving local tourism assets by building on local architectural traditions. This indicates that the Bank’s implementation assistance at restructuring was responsive. Therefore, relevance of restructured project implementation is rated Substantial.

3.2 Achievement of Project Development Objectives Original Project Rating of Achievement of Project Development Objectives: Negligible Restructured Project Rating of Achievement of Project Development Objectives: Moderate 60. The project moderately achieved its overall development objectives. Several parts

of the objectives were accomplished. For example, the project was able “to assist the Government of Albania” for nine years, establishing a robust platform for deepening engagement. The project had limited success in “developing, on a sustainable basis, tourism in the South Albania coast,” in a comprehensive way but it had a high degree of success in “improving critical public environmental infrastructure and municipal services, remediating and containing pollution hazards from a former chemical plant in Porto Romano near Durres, improving community infrastructure and enhancing architectural and cultural resources.” Linked directly with these infrastructure and service improvements, there was success in demonstrating “sustainability.” For example, the waste management landfill has evidently resulted in improving collection, transportation and disposal of waste in a sustainably operated landfill facility. A clean city is expected to create an improved environment for tourists. Similarly, the Saranda Gateway, a port facility has resulted in the arrival of bigger cruise ships from neighboring countries. The opening of the Gateway has resulted in 25 percent increase in passenger traffic from 2013 to 2015 and a threefold increase in the number of cruise liner dockings. Increased passenger traffic has lead to increased tourism spending—on

49

shopping, food, sightseeing, and overnight hotel costs, resulting in increased local income. Investments in water supply, sanitation and road facilities created under the project have sustainably improved the quality of life of local population, including their ability to attract more tourists. Also the cleaning up of Porto Romano, which was threatened by hazardous chemicals from a former lindane plant in Durres and by several obsolete chemical storage warehouses, has resulted in increased conservation of wetlands near beaches, improving the sustainability of the area.

61. Outcome-level results are linked to specific outputs. There is a causal linkage between various outputs and the project outcomes. However, many outcome-level indicators are perhaps more reflective of results at the output level. The Results Framework provides the grounds for judging achievements but mostly at output level. Interventions in environmental infrastructure supported by other donors and by the Government also influenced the project outcomes. For example, investments to improve water supply in Saranda were affected by the Government’s investments in improving water connections at the household level. Similarly, the performance of the wastewater outlet from Saranda to the Cuka Channel supported under the project is linked to investments in a wastewater treatment plant supported by separate German funding. Overall it is assessed that the project achieved the PDO, despite significant delays in implementation. Achievements of the revised PDO indicators and their causal links with project outputs are described below:

(a) PDO Indicator 1: Increased capacity for population served by the newly built

Landfill site and Transfer Station At the time of project appraisal (2005) and of the Level 1 restructuring (2010), there was no safe disposal of solid waste in the Southern Coast. The indicator is well linked with the output, improved landfill capacity. Construction of the sanitary landfill (with 3,65,000 m3 capacity, accommodating disposal of 25000 tons waste annually at 712kg/m3 for at least 10 years of operation), has facilitated improved household-level collection of solid waste and enhanced willingness in several municipalities to improve the financial sustainability of the entire solid waste management chain .

(b) PDO Indicator 2: Improved water supply network and sewage system in Saranda. This indicator is linked to the reconstruction of sewer networks and extension of water supply (2.5 km) that involved the construction of a wastewater outlet from the WWTP in Saranda to the Cuka Channel, replacement of 12 km Navarica Trunk main, and rehabilitation of the existing reservoir (1,000 m3). At the close of the project, the wastewater channel was completed but the Saranda WWTP remained non-operational because of missing inflow and outflow connections. However, water supply for 40,000 inhabitants of Saranda (and twice that many people during the summer tourist season) is improved. Water capacity has been doubled to 70 liters per second (l/sec) from an average of 20–30 l/sec before the investments. In addition, the water supply of Navarica village has improved through the construction of a new 1 km water pipe serving 50-70 households, or about 300 inhabitants.

(c) PDO Indicator 3: Increased access for international tourists and access of cruise liners to the South Coast. This indicator is linked to a clear output:

50

construction of 180 m new berth front with 9 m water depth, as well as paving, drainage, fencing, and utilities. The port became operational in October 2014, allowing the arrival of large cruise liners and generating a significant increase in the number of international tourists.

(d) PDO Indicator 4: Remediation of contaminated sites through removal and containment of hazardous materials. This indicator is directly related to an output: the project carried out remediation and 100 percent cleanup of hotspots sites (with safe disposal and encapsulation at the Confined Disposal Facility of more than 45,000 m3 hazardous waste) in Porto Romano, reducing the environmental health risks to residents.

(e) PDO Indicator 5: Community based investments in coastal villages have improved infrastructure enabling sustainable tourism development in the South coast. This indicator is related to a range of community-based infrastructure investments that supported tourism development. The work included improving roads, village squares, and water supply schemes that benefited more than 10 villages. Several community subprojects helped improve the quality of life of local people: the construction of a new ring road in Orikum used by 2,092 families; improved access to the beach during the summer season; improved sewage and water supply network for 800 households in Himara Municipality; improved water supply for more than 400 families in Gjilek; water supply rehabilitated for 167 families in Vuno; water supply for 380 families in Piqeras and 355 families in Shen Vasil; and improved access roads for residents of Ilias, Palase, Dhermi, Qeparo, Borsh, and Nivice.

(f) PDO Indicator 6: Protection and promotion of vernacular architecture of the South Coast. This indicator is related to the output of the R&F rehabilitation program: conservation works completed in several houses in Himara Municipality and Lukova Commune promoted the vernacular architecture.

3.3 Efficiency Original Project Rating of Efficiency: Negligible Restructured Project Rating of Efficiency: Substantial 62. Overall the costs involved in achieving the project objectives were reasonable with

respect to benefits and value for money. Because of a lack of monitoring data, a full economic and financial analysis was not possible for every component. Calculated benefits were completed for the landfill and transfer station (under component B1), the Saranda Gateway (B2), the Saranda water supply and sanitation projects (B3), and the road, water supply, and sanitation activities under CVCDP (B4). Overall, given the estimated economic benefits shown below and in Annex 5, the components evaluated in this economic analysis can be considered efficient. Landfill. As a base case we assume that the waste generation rate is 1.0973

kg/person/day from local statistics and that the landfill generates revenues based on the 25,000 m3/year receiving capacity. At a 12 percent discount rate, the net present value (NPV) is US$0.05 million with an internal rate of return (IRR) of 5 percent

51

(i.e., in the first 10 years, and including the Austrian grant). If recycling options were to take place after year 10, extending the life of the landfill to 17 years, then the NPV would be about $0.22 million and an IRR of 12 percent. The currently negotiated gate fee of US$14.50/ton covers operating and maintenance costs – however tariff rates would have to increase by 5 percent per year to cover rising O&M costs and for the sub-project to remain economically feasible.

Saranda Gateway. Development of the port facility allowed a 25 percent increase

in passenger traffic from 2013-1015 and a threefold increase in the number of cruise liner dockings. Increased passenger traffic leads to increased tourism spending—on shopping, food, sightseeing, and overnight hotel costs. Goods and services are subject to a 20 percent VAT, representing an incremental benefit to the local economy. In the base case of future passenger growth of 10% beginning in 2015, each passenger staying an average of 3 days, with a discount rate of 12 percent, the NPV is $12.82 million and the IRR 26 percent in year 20 (i.e., the life of the port). Varying the assumption about the growth in arrivals appears not to influence either the NPV or IRR substantially; however, varying the length of stay from 1 to 3 days doubles the NPV and IRR.

Water supply and sanitation. Tariffs for the Saranda water supply and sanitation

works are currently below capital cost-recovery levels; however, the investment cost of US$80 per capita in the service area compares well with the costs of similar water supply and sanitation projects in Albania that were deemed cost-efficient (i.e. US$84 per capita).16 The road and water supply and sanitation projects under the CVCDP component can be similarly benchmarked against previous projects that were deemed cost-efficient. For example, the average cost per km for road works in Albania has been approximately US$200,000,17 and for this project, most roads were within this range. The rural water supply and sanitation projects cost on average more than the US$80 per capita benchmark, but the scope of works included additional (more costly) infrastructure such as the construction of reservoirs and water pumping to accommodate the sloped terrain.

Health benefits. Besides the need to improve the tourism potential, the coastal

population, water supplies, and wetlands in Porto Romano were threatened by hazardous chemicals from a former lindane plant in Durres and by several obsolete chemical storage warehouses located in wetlands near beaches. Although the health benefits would be difficult to ascertain without a long-term epidemiological study of the population, the project benefited approximately 5,000 people through the plant clean-up and the safe removal and disposal of obsolete chemicals from the storage facilities.

16 Albania: Durres Water and Sanitation Rehabilitation Project and Water Supply Urgent Rehabilitation Project, Project Performance Assessment, Report No. 31626, 2005, page 10. 17 Albania: Secondary Local Roads Project, Implementation Completion Report No. ICR2750, 2013, page 30.

52

3.4 Justification of Overall Outcome Rating Rating: Moderately Satisfactory 63. The Project Outcome Rating takes into account the suboptimal performance

before the IP investigation and the satisfactory performance following the March 2010 restructuring. It is evident that the project performance prior to 2010 suffered from an overambitious project design, the complex political economy context of land-use planning in the southern coast, and a complex institutional implementation structure. Following the IP investigation, the Level 1 restructuring in March 2010 addressed many of the design and implementation issues, paving the way for improved implementation performance. Before restructuring the project disbursed 25 percent of the credit, and it is assessed that its overall relevance was Moderate, achievement of objectives was Negligible and efficiency was Negligible. Therefore, prior to restructuring, the overall outcome rating is assessed as Unsatisfactory. However, after restructuring, the project disbursed 75 percent of the credit, and it is assessed that its overall relevance was Substantial, achievement of objectives was Moderate and efficiency was Substantial. Therefore after restructuring, the overall outcome rating has been assessed as Moderately Satisfactory. With regard to the rating of the outcome of the GEF MSP, although the key outcome indicator was met, most of the other envisaged activities were not performed due to slow implementation. Hence the overall rating for the GEO was assessed as Moderately Unsatisfactory. Applying IEG’s objective-based evaluation methodology 18 results in an overall outcome rating of Moderately Satisfactory.

No. Items Against

original PDO Against

revised PDO Overall

1. Ratings Unsatisfactory Moderately Satisfactory

2. Rating value 2 4 3. Weight (% disbursed

before and after PDO change)

25% 75%

4. Weighted value (2x3)

0.50 3.00 3.50

5. Final rating (Rounded)


3.5 Overarching Themes and Other Outcomes and Impacts

18 As per updated ICR Guidelines, 2014.

53

(a) Poverty Impacts, Gender Aspects, and Social Development 64. In spite of a slow and difficult start, the project, through its focus on community

infrastructure and local development, generally improved environmental conditions for and services to thousands of families in the project area. Such interventions are perceived to directly and indirectly improve local income and livelihood options. Although the project did not perform an upstream poverty assessment, many poor people around the project area benefited through reduced risks and improved environmental infrastructure. For example, many of the residents of Porto Romano had been exposed to high levels of chromium pollution from the former lindane plant; removing the contaminated materials and soil eliminated a significant health hazard, especially for children. The project also created numerous opportunities for jobs in tourism and local services, many for women heads of households, by providing the needed infrastructure to coastal communities with populations of more than 70,000.

(b) Institutional Change/Strengthening

65. Institutional capacity for coastal zone management continues to be low. The original project aimed to improve coastal zone management by strengthening the monitoring and enforcement capacity of the Ministry of Territorial Adjustment and Tourism, the Ministry of Environment, and the Ministry of Agriculture and Food. However, the components on strategic policy support were significantly modified or dropped during the 2010 restructuring: improving regulatory capacity; capacity building for resolution of disputes; ICZM capacity; environmental management strengthening; and land-use and spatial planning strengthening. The restructured project focused on infrastructure development that contributed to some extent to building the capacity of institutions involved in planning and implementation at the regional and local levels.

66. In addition, several rounds of changes in leadership among counterpart personnel and at the local government level affected the pace of activities that supported institutional capacity building. These frequent changes included mayors and officials of municipalities who had overall responsibility for infrastructure. The general election in June 2013 resulted in transferring project responsibility from the MoPWTT to a newly created MoUDT.

(c) Unintended Benefits

67. One subcomponent—the R&F improvement program—generated significant

interest and succeeded beyond expectations. The R&F program was successful in attaining its implied objective: to change behaviors. This is evidenced by the fact that all renovations financed by homeowners independently of, and since the inception of, the R&F program have been generally consistent with the principles promoted by the program. There have been some deviations, mostly of a decorative nature, yet these are in no way comparable to the former construction practices, when clashing architectural

54

forms were erected and cement, rather than traditional masonry, was often used. Some of the achievements of the R&F program are as follows.

Qualitative Outcome: Perception of Vernacular Architecture as an Asset.

Spontaneous changes were noted in property owners’ behavior and the overall high level of satisfaction of those receiving grants (see box below). The Head of the Tourism Department of the Commune of Lukove expressed his administration’s interest in continuing the program after the ICZMCP’s completion, albeit with a lesser proportion of cofinancing from the Commune. While the details and envelope for such an endeavor have yet to be established, the fact that local authorities are contemplating such an intervention is testimony to their radical new perception of the value of vernacular architecture as an asset, as well as evidence of the capacity built by the R&F.

Quantitative Outcome: Increased Real Estate Values. Another interesting impact was an increase in real estate prices. While this outcome may not be entirely attributable to the R&F program—the purchase of property by foreign nationals was in all likelihood the driving force in imparting to residents a new perception of the value of their village—it can nevertheless be assumed that the R&F program, by promoting a preservation and authenticity ethic, was one of the influential factors in making these villages attractive and in fostering foreign investments.

Institutional Impact: Conservation Guidelines. The elaboration of the Conservation Guidelines met with unexpected success. Not only did institutional stakeholders welcome them but, more importantly, these guidelines have become part and parcel of the building regulations at both the Municipality of Himara and the Commune of Lukove.

Institutional Impact: Creation of a B&B Association. Despite the fact that no more than two B&B had benefited from the R&F program by project closing, the fact that the B&B training was made available to non-applicants proved to be a very judicious design element. In fact, attendance was comparatively high; as a result a B&B Association, consisting of eight members and chaired by an elder of Qeparo, has filed a request for registration at the registration office, following court approval.

3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops 68. An extensive beneficiary survey was carried out at the end of the project, and an

implementation completion workshop (see Annexes 7 and 8) was held in March 2015 to discuss the project results. The survey covered 12 project sites and included about 595 interviews, 520 (87 percent) of which were interviews with direct

Ihadnotroubleinanyofthetransactionswiththecontractorandthequalityofworkswasexcellent.Comparedtomyneighbor’sexperiencewhodidnotparticipateintheprogramandpaidmorefortheworksonhishouse(thatwereshoddierthanmine),Imadeagoodchoiceinparticipatinginthe

R&F.Itendedupbeingmorecost‐effective.Iliasbeneficiary

55

beneficiaries and representatives of municipality- and commune-level governments. The assessment included 11 focus group meetings with local community representatives and about 35 in-depth interviews with local officials in the project area. The majority (71.5 percent) of interviewed residents in the project area are generally aware or have knowledge of the project. The project has affected the infrastructure of 17 villages/towns and 8 local government units (communes and municipalities) through a varying number of subprojects: one (for 42 percent of the beneficiary communities), two (for about 29 percent of beneficiary communities), and three or more (for 29 percent of the beneficiary communities).

69. The results of the survey and feedback from stakeholder workshop indicate a

significant level of satisfaction among the beneficiaries. According to the survey, about 86,685 inhabitants, or 85 percent of the total population living in the project area, benefited from the project’s South Coast Environmental Infrastructure component. The survey findings are summarized below. Some 54.2 percent of the respondents said the construction of the landfill in Bajkaj

and the transfer station in Himara will have a positive effect on tourism in the project area.

About 63.5 percent of those interviewed thought that the location selected for the landfill is appropriate, whereas 14.0 percent found it not appropriate.

About 60 percent of the inhabitants in the coastal villages benefiting from water supply investments under the CVCDP-2 specified that the main impacts were the environmental improvements in the area and the reduction of environmental and coastal pollution.

16 villages/towns distributed in eight local government units benefited from the project investments: Orikum, Himara, Vuno, Dhermi, Gjilek, Qeparo, Ilias, Palase, Lukove, Borsh, Piqeras, Shen Vasil, Nivice, Bajkaj-Palavli, Xarre, and Pllake-Qenurio.

47 percent of those interviewed believed that the investments had a positive effect on local tourism.

About 55 percent of people interviewed believed that the implementation of the project will encourage future investments in the area.

About 75 percent of the people interviewed in the Porto Romano area where clean-up of environmental hazards was carried out were satisfied with the outcome of the project.

93 percent of the people interviewed who were aware of the investment confirmed that it had a positive impact on the environmental situation in their area.

4. Assessment of Risk to Development Outcome Risk Rating – Substantial 70. Infrastructure developed under the project is fully operational, but risks to

sustainability remain high. Because most of the public infrastructure (such as community roads and the R&F program) requires only low-budget maintenance, it represents moderate risks to the achievement of outcomes. However, there is a high

56

risk that some of the larger environmental infrastructure investments—such as the solid waste landfill site, the transfer station, and the wastewater treatment plant—will not be operated fully or properly maintained, because of inadequate allocations in the maintenance budgets of local utility companies and the fact that trained professionals are not available. Thus there is a substantial risk that development outcomes achieved under the project in terms of service quality improvements may not be sustained.

71. One risk to the development outcomes relates to the overall financial

sustainability of utility companies in Albania. Utilities in the participating cities, such as Himara and Saranda, not only fail to generate sufficient revenues for operation and maintenance, but are far from achieving cost recovery of services to guarantee financial viability. While this is a medium-term risk for the sustainability of the project, in the absence of utility reforms there is a substantial risk of not being able to ensure uninterrupted and effective water supply and solid waste services during the tourism season. The utilities need to be able to lower their operating costs, adjust tariffs as needed, and maintain high collection rates if they are to improve their financial viability. Throughout implementation, collection and payment of an operating fee for solid waste management was a contentious political issue that affects the financial viability of these investments. However, by the project closure a service agreement was signed to address operating fee for solid waste management.

72. Another risk is that physical investments made through the project and the

associated service improvements and operational standards attained will not be sustained because of inadequate resources for proper operations and maintenance and insufficient capital investments to upgrade systems. A third risk relates to governance of the institutions if the institutional support provided through the new structures is not adequate to sustain the development outcomes. The sustainability of the solid waste landfill site will require local government ownership, commitment, and strong political support; coordination among several utilities; and cooperation with the private operators. The sustainability of the wastewater treatment plant will depend on the utilities’ adherence to the principles of good governance and implementation of actions to achieve financial viability.

57

5. Assessment of Bank and Borrower Performance 5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry Rating: Moderately Unsatisfactory 73. Bank performance is rated moderately unsatisfactory for quality at entry of the

project due to inadequate attention to risk mitigation strategy within a complex project design. The assessment found that sufficient resources were devoted to preparing the project and the background analysis and design duly considered most of the relevant issues. However, inadequate attention was paid to ensuring that the project design and components focusing on institutional development and policy related aspects were fully aligned with the legal and regulatory framework for coastal zone management in Albania at the time. At entry, the task team designed an integrated coastal zone management project that entailed relevant and innovative features that are still very much valid and appropriate today. Project alternatives were evaluated reasonably and the reasons for their rejection clearly documented. In this context, the Bank and the Borrower prepared the project by: (a) carrying out a background analysis; (b) evaluating lessons learned from previous similar operations and appropriate alternatives; (c) designing a technically feasible project; and (d) evaluating a range of risks and proposing appropriate mitigation measures. However, the project design did not include a robust strategy to mitigate these risks, either during appraisal or during implementation.

74. A longer project preparation did not yield a robust analyses of risk-mitigation alternatives. The risk of poor coordination among institutions was appropriately rated as High, and lack of coordination indeed proved to be an implementation problem. Although the risks in dealing with such a complex project were properly identified, the mitigation measures taken to deal with risks were not effective and caused delays in implementation and disbursement. Also as concluded by the IP investigation the initial decision not to apply OP/BP 4.12 at the decisive stage of appraisal and during implementation was a root cause in the mishandling of the Jale demolitions. This, and the failure to effectively safeguard the project through an agreement with the Government to suspend demolitions in the project area, had negative consequences for the affected population and for the Bank’s reputation. Therefore, the rating of Moderately Unsatisfactory reflects the need to be more realistic in assessing risks and proposing effective mitigation measures, especially when several institutions with different implementation capacities are involved in project implementation and project preparation takes longer than usual.

(b) Quality of Supervision Rating prior to Restructuring: Moderately Unsatisfactory Rating after Restructuring: Moderately Satisfactory

58

75. The IP investigation underscored poor Bank performance in supervision early on.

The Bank’s supervision efforts before receiving the complaints in 2007 are considered to have been insufficient. With the benefit of hindsight it is evident that more implementation support efforts were needed, particularly during the period before restructuring in March 2010, to ensure that the institutional framework of the project would work and that the coordination of institutions by the Ministry of Tourism Development would be effective. In 2008 the IP noted in its report to the Board: “This Project, which included components known to be associated with demolitions in the Project area, harbored a critical risk that could have been avoided with an appropriate contractual framework and adequate supervision. The Panel finds that the Bank has failed to supervise the Project, as required under Bank’s Policy on Supervision OP/BP 13.05.” The Bank’s Management Response noted that there were “serious errors in project preparation and supervision.”

76. Overall Bank supervision is rated Moderately Satisfactory, considering a

continuous and long period of moderately satisfactory supervision after restructuring, from 2010 on. After April 2010, and particularly in response to the findings of the IP investigation, the Bank team and Management ensured the highest level of effort but implementation continued to be challenged by delayed procurement and completion of planned activities. The team focused on (a) diligent work to respond to the IP investigation by working with the borrower to implement the MAP and IP recommendations; (b) prompt and sound identification of implementation problems and delays, with high-quality advice and proposed solutions to help the borrower address such problems; (c) frequent supervision missions (a total of 18 ISRs were filed, including 9 between April 2010 and March 2015); (f) appropriate and prompt Bank follow-up actions; and (g) strong Management support and adequate budget allocations.

77. The Bank team displayed s t r o n g commitment to project implementation

following the IP investigation. Following the IP investigation, the task team and the Bank’s corporate units provided critical support to the client. The enhanced supervision that was triggered by the MAP focused on improving the project’s quality and outcome. Land acquisition and resettlement directly associated with the components of the restructured project were monitored closely by the Bank and completed satisfactorily. However, it must be acknowledged that even though the IP process did help raise the Government’s awareness about the importance of adequately managing land acquisition and resettlement, the institutional capacity to manage resettlement processes continues to be deficient, particularly with respect to identifying and evaluating losses of incomes and livelihoods, implementing RAPs, and monitoring post-resettlement socioeconomic changes.

78. The task team made a substantial effort to turn around implementation

performance toward the end of the project. Overall, the task team showed in-depth knowledge of the client’s needs, ensured continuous engagement with project stakeholders, and appropriately adapted the project to ensure maximum relevance and achievement of the PDOs in light of changing macroeconomic conditions and local priorities. The team also provided very thorough follow-up with the borrower on

59

specific recommendations, giving strong and continued support to the client. The team’s perseverance, adequate response, guidance to the borrower, and commitment to the project led to lifting the suspension of disbursements. The task team then provided timely and responsive support to the client during the 2010 credit restructuring. The Bank’s country and sector Management also provided excellent support to the task team, allocating adequate budget to supervise the high-risk, high-profile project. Management kept the Board informed through periodic progress reports on the implementation of the agreed action plans following the IP investigation.

(c) Justification of Rating for Overall Bank Performance Rating: Moderately Satisfactory 79. Notwithstanding the delays and challenges with the initial project design, the

Bank team redoubled their efforts after March 2010. The Bank’s proactive engagement to address implementation problems helped adapt the project to changing circumstances and resulted in the substantial achievement of the PDOs, albeit with three years’ delay. Because of the extraordinary support provided to the implementing agencies, the Bank was able to maintain a good working relationship with the client throughout the IP investigation and MAP implementation. The improved relationship is now leading to another potential project engagement between Albania and the Bank for economic regeneration and tourism development of southern coastal areas.

5.2 Borrower Performance (a) Government Performance Rating prior to Restructuring: Moderately Unsatisfactory Rating after Restructuring: Moderately Satisfactory 80. During project preparation, the GoA provided necessary support for the

preparatory studies (such as the SCDP, interim coastal regulations, and the drafting of a legal, institutional, and policy framework for ICZM); estimating the investment needs; and drawing on previous experience with Bank operations to recognize institutional weaknesses that could hinder implementation. Prior to restructuring, there were significant delays and gaps in evolving consensus around policy and planning interventions for integrated coastal zone management, due to several political, economic and social factors. In addition, project implementation before restructuring was subject to significant procurement delays.

81. GoA displayed reasonable commitment to the project by setting up a high-level Inter-Ministerial Working Group during project preparation. It was able to responsively satisfy requests made by the IP, and it took careful steps to ensure that most of the resettlement and environmental management was carried out according to Bank guidelines. GoA took notice of the recommendations of the team and requested the credit restructuring, when needed. GoA should also be applauded for establishing a

60

Project Steering Committee of high-level decision-makers to provide overall project oversight, review project progress, and resolve grievances. GoA demonstrated its commitment during the Level 1 project restructuring by fulfilling effectiveness conditions that put the project back on track. The GoA’s performance was particularly effective in resolving differences between local governments, which led to the registration of the Solid Waste Management Company on November 11, 2014. However, project implementation, even after restructuring continued to witness significant delays related to protracted procurement in key contracts. Overall, GoA’s performance is rated Moderately Satisfactory.

(b) Implementing Agency Performance Rating prior to Restructuring: Moderately Unsatisfactory Rating after Restructuring: Moderately Satisfactory 82. The PCU demonstrated a high degree of dedication and commitment during the

IDA credit suspension. Generally the PCU worked well but were significantly challenged by major capacity gaps, particularly during the period prior to restructuring. In the initial years, there was a steep learning curve for the MoPWTT and later for the MoUDT, as this was their first Bank-funded project. After restructuring especially in the last years, frequent departures of staff affected project performance. While their capacity improved during later years of project implementation, their ability to coordinate the various agencies, particularly with the regional and local governments, remained weak. This was due in part to lack of clear authority to do so, and in part to the fact that the other agencies were equally powerful within GoA’s structure and political environment, and thus the MoUDT’s ability to influence the other agencies remained limited.

(c) Justification of Rating for Overall Borrower Performance Rating: Moderately Satisfactory 83. The overall borrower performance is Moderately Satisfactory based on the

performance of the GoA and of the implementing agencies.

6. Lessons Learned

84. The Bank and client can learn several lessons from this project. Some of the lessons that are particularly relevant for engagement in Albania are discussed below.

(a) Albanian coastal areas have a unique and complex sociocultural and political

setting. Careful sequencing of policy and planning interventions for coastal zone management is required to maximize the results of priority investments in Albania. The Bank’s experience with ICZM shows that support for institutional strengthening, restructuring, and policy reform works best in the context of an operation that also demonstrates tangible benefits and catalyzes ownership at the national, regional, and community levels. The importance of policy and planning

61

interventions for protecting and developing the coastal zone along with investments in local infrastructure cannot be overemphasized in any effort at sustainable economic development of the pristine coastal areas. The effect of the IP on this project was twofold: it increased the Bank’s attention to risks and their effective management, and it focused the project on short-term outcomes related to infrastructure investments and decreased attention to building long-term capacity in the GoA for policy and planning. Recently, the GoA has emphasized the importance of attracting private sector investments for promotion of coastal tourism. However, this could be a major challenge without a comprehensive policy for tourism and coastal zone management, as well as a planning framework that can define priorities and avoid potential conflict with local populations and other competing users of coastal resources. The project was able to achieve its outcome despite very difficult challenges because the GoA and the Bank were committed to overcome complex social safeguards risks and changing macroeconomic conditions. Careful sequencing of policy reforms to balance development with protection of irreplaceable assets is key to a sustainable approach to coastal development.

(b) The application of safeguards policies for projects in Albania involving land-

use planning requires careful evaluation and monitoring of the environmental, social, and economic context. Over the last several decades, many Bank projects have included components or subcomponents that encompass elements of land-use planning. In practice, there is usually a clear distinction when dealing with urban areas (cities, towns, or municipalities with concentrated, densely packed people and associated living and service structures), rural areas (sparse or patchy dispersed populations), or coastal zones (including densely populated urban cities, coastal waters, marine ecosystems, and associated natural resources—reefs, wetlands, estuaries). Lessons from Albania demonstrate that land-use planning activities and approaches depend on the client country and its historic, political, and cultural context. Past colonial influences and more recent socialist and communist governments have greatly shaped tenure systems and subsequent land laws, regulations, and planning processes. The project informed the Bank’s safeguards approach and led to the development of corporate-level guidance on applying social safeguard policies that emphasizes deeper assessment and monitoring of the socioeconomic impacts of changes in access, use, control, and management of land and natural resources.

(c) All prior agreements with central or local governments in Albania should be based on a clear assessment of critical project risks and involve candid communication with the Board. The IP investigation highlighted that the Bank should rely on a firmer prior commitment and documented agreement with the borrower on critical aspects and complex issues such as demolition of illegal squatters, before presenting such issues in the PAD. The investigation also highlighted the need for Bank Management to be very diligent in providing a clear and candid assessment of critical project risks to the Board of Executive Directors. The Bank also recognized that project personnel appointments that present a real or

62

perceived conflict of interest should not be handled as a routine procurement matter and should be avoided, if possible.

(d) Coastal zone management in Albania requires intensive implementation support and stakeholder involvement, including with indirect beneficiaries, throughout the project cycle. Promoting a participation process with all the stakeholders at the community, local, regional, and central levels from the beginning of the process is key for ICZM. A sustainable and effective ICZM process in Albania will require greater involvement of those stakeholders involved in land-use planning and land resources management—for example, local authorities and municipalities. Future projects should provide adequate opportunities for setting up a credible grievance redress mechanism and for active involvement of stakeholders and civil society through consultations, improved public awareness, and access to information. A key lesson from projects implemented in Albania is that projects and programs with a high degree of local participation have greater chances of success.

(e) Albania’s coastal area is characterized by a multiplicity of stakeholders and multisectoral development issues, with extremely high risks related to institutional coordination. New institutional arrangements for ICZM should be identified in a transparent and participatory manner, and decisions should be taken when there is consensus among the several agencies and actors operating on the coast about the new rules of the game. Premature institutional reforms may cause more harm than good. The ICZM process must ensure that authorities at different levels of administration share power (from the central to the regional level, from the regional to local governments, and from local government to villages and communities) and coordinate disparate functions such as planning and zoning, issuing construction permits, budgeting, and development. One of the key reasons for the slow pace of ICZMCP implementation was the complex project design with overambitious implementation arrangements that involved multiple implementing agencies without effective coordination. Inordinate delays occurred in project components, requiring greater inter-agency coordination. To minimize such delays, future projects should be designed with fewer agencies involved in implementation, and with very clear roles and responsibilities defined for each agency involved as well as enough power vested in the coordinating agency.

(f) To ensure the sustainability of public investments in coastal areas of Albania, a consensus among various development partners is essential. When a large number of donor organizations are engaged in ICZM-related activities, working in partnership with multilateral and bilateral organizations is not only desirable, but indeed necessary, to ensure that the activities of development partners are compatible and not mutually exclusive.

85. In addition, the project generated some lessons that may be relevant Bankwide

for future engagement in similar projects. They are discussed below.

63

(a) For greater efficiency, the project design should adequately focus on building the client’s capacity, especially in new areas, and have enough flexibility to allow implementation arrangements to evolve. During implementation the client began to appreciate the nature and significance of some major resettlement issues in coastal zone management. Very active Bank involvement during implementation allowed the client to gradually evolve its approach for resettlement from a more bureaucratic to a more sustainable and consultative approach. It required sustained efforts and prolonged discussion to change the mindset of local agencies and reinforce their capacity to address difficult and sensitive challenges, such as loss of livelihood due to economic displacement, coastal resources management, and the financial sustainability of localized sea beach tourism.

(b) To enhance implementation quality and outcomes, mechanisms for strengthening transparency, accountability, and good governance should be planned upstream and integrated in the project design. Successful implementation of the plan to address project-specific social safeguards risks, the most challenging issue in ICZM, was due to establishing effective institutional mechanisms, including independent monitoring and a transparent and accountable grievance redress mechanism for resolution of complaints and disputes.

(c) User satisfaction with the project. A project of this nature should have included a user survey to be undertaken by an independent entity both before the investments were begun and after they were completed. This would allow gauging the impact of the project components on different segments of the population and would start building up a philosophy that the users must be heard periodically.

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners

(a) Borrower/implementing agencies (b) Cofinanciers (Austrian, EC Delegation and Dutch Donors) (c) Other partners and stakeholders (e.g. NGOs/private sector/civil society) No issues were raised on the draft ICR by the implementing agencies and co-financiers.

64

Annex 1. Original Indicators (a) Original PDO and GEO indicators

Indicator Original Baseline Final Target Value Actual value achieved

before restructured in 2010

Indicator 1 : Completion and approval of the SCDP by the National Council of Territorial Adjustment.


None 100% 100%

Date achieved Year 0 Year 5 Not available Comments (incl. % achievement)

The SCDP was completed and approved prior to restructuring in 2010.

Indicator 2 : Development of communal infrastructure in the southern coastal area in compliance with the SCDP.


None None No information available

Date achieved Not available Not available Not available


Original PAD did not include any baseline information in the M&E Framework. The original Results Monitoring arrangements excluded this outcome indicator, without providing justification. The indicator was not included in the restructuring proposal.

Indicator 3 : Local land-use planning and issuing of construction permits in the southern coast in compliance with the parameters and measures set forth in the SCDP.


None 70% No information available

Date achieved Not available Not available Not available Comments (incl. % achievement)

A survey in year 1 was planned to confirm the baseline. However, it was not done by restructuring. This indicator was dropped at restructuring in 2010.

Indicator 4 : New buildings in the southern coastal area do not disturb the existing spatial value and characteristics.


None None No Information available



No baseline data or final target was included in the original Monitoring Framework. The original Results Monitoring arrangements excluded this outcome indicator, without providing justification. At restructuring the indicator was revised to, “Initiate and complete community-based investments in coastal villages with active participation of the villages and Local Government Units

65

through completion of the first and second phase of the Coastal Village Conservation and Development Program with active participation of the Southern Coast communities”

Indicator 5 : Local, regional and national planning efforts and development initiatives aligned with the principles and guidelines of the SCDP.





No baseline data or final target was included in the original Monitoring Framework. The original Results Monitoring arrangements excluded this outcome indicator, without providing justification. At restructuring this indicator was dropped.

Indicator 6 : Stakeholder participation incorporated into coastal zone management decisions. Value quantitative or Qualitative)

None 30% No Information Available

Date achieved Not available Not available Not available Comments (incl. % achievement)

The baseline data was expected to be confirmed through a survey in the first year, which was not done until restructuring. At restructuring, the indicator was dropped.

Indicator 7 : At least 5,000 tons of household waste and 5,000 tons of construction and demolition waste actually collected and disposed off in proper facilities.


None 5000 tons No Information available



The baseline was supposed to be confirmed through a survey in year 1, which was not done until restructuring. There is no information available to indicate if the outcome was achieved. At restructuring, the indicator was revised as Indicator 1, “Increased % of population served by the newly built Landfill site and Transfer Station through establishment of infrastructure for safe disposal of municipal solid waste in the Southern Coast that meets EU standards through construction of a landfill in Bajkaj and transfer station in Himare built and operational”.

Indicator 8 : At least 50% of the tourist wastewater load in Saranda collected and treated. Value quantitative or Qualitative)

None 50% No Information Available



No baseline data or yearly target was included in the original Monitoring Framework. The original Results Monitoring arrangements excluded this outcome indicator, without providing justification. At restructuring, the indicator was revised to indicator 2, “Improvement of the piped household and hotel water supply and sewer household and hotel connections in Saranda through Reconstruction of sewer networks (2.1 km of new sewer lines) and extension of water supply (2.5 km);

66

Construction of wastewater outlet from the WWTP in Saranda to the Chuka Channel (2.8 km); [12.5] km Navarica Trunk main replaced and existing reservoir (1000 m3) rehabilitated.”

Indicator 9 : At least 50% of public beaches and shellfish areas in the southern coast monitored for water quality against Albania’s and EU standards.


None 50% No Information available



The baseline was supposed to be confirmed through a survey in year 1, which was not done until restructuring. There is no information available to indicate if the outcome was achieved or not by restructuring. At restructuring the indicator was dropped.

Indicator 10 : Tourism and visitor revenues in the southern coast increased and benefited wider communities.


None 40% No Information available



The baseline was supposed to be confirmed through a survey in year 1, which was not done until restructuring. There is no information available to indicate if the outcome was achieved or not by 2010, when restructuring was done. At restructuring, this indicator was revised to, “Reconstruction of Port facilities to allow access of cruise liners in order to facilitate passenger access to the Southern Coast by construction of 180m new berth front with 9 meter water depth, paving and drainage, fencing, and utilities”

Indicator 11 : Protected areas management plan for Butrint National Park developed with wide stakeholder participation and rules are enforced through appropriate by-laws (GEO Indicator).


None 100% 100% Achieved

Date achieved Not available Year 3 September 2010


This is also a GEO indicator. This outcome was supported by the GEF and included as the GEO in the ICZMCP. The GEF support for the BNP, however predated the ICZMP through a Mid-Size Proposal (MSP) grant. By September 2010, the BNP management plan had been prepared and approved by the technical departments of the Ministry of Environment, Forestry & Water Administration and the Ministry of Tourism, Culture, Youth and Sports.

Indicator 12 : Detailed regulatory plans formulated, adopted and enforced by at least 3 coastal municipalities and/or communes.


None 3 No Information available

Date achieved Year 0 Year 5 Not available

67


There is no information available to indicate if the outcome was achieved or not by restructuring. At restructuring, the indicator was dropped.

Indicator 13 : Local strategic plans formulated and adopted by at least 5 communes in the southern coast.


None 5 No Information available

Date achieved Year 0 Year 5 Not available Comments (incl. % achievement)

There is no information available to indicate if the outcome was achieved by restructuring. At restructuring, the indicator was dropped.

Indicator 14 : Execution of environmental impact assessment (EIA) in accordance with the EIA procedures.





No baseline data or yearly target was included in the original Monitoring Framework. The original Results Monitoring arrangements excluded this outcome indicator, without providing justification. At restructuring, the indicator was dropped. It is noted that EIAs were prepared for all investments.

Indicator 15 : Enhanced economic incentives to promote integrated coastal zone management objectives introduced and actively used.





No baseline data or yearly target was included in the original Monitoring Framework. The original Results Monitoring arrangements excluded this outcome indicator, without providing justification. At restructuring, the indicator was dropped.

Indicator 16 : Reduction of soil contamination in Porto Romano guided by the land-use plan formulated and adopted by the Municipal Council of Durres.





No baseline data or yearly target was included in the original Monitoring Framework. The original Results Monitoring arrangements excluded this outcome indicator, without providing justification. At restructuring, the indicator was revised to, “Remediation of contaminated sites through removal and containment of hazardous materials in Porto Romano to reduce human health hazards through Landfilling and encapsulation of 45,000 m3 of hazardous waste on one of the sites”

68

(b) Original Intermediate Result Indicators

Intermediate Results One per Component

Results Indicators for Each Component

Use of Results Monitoring

Component One:

Capacity of the Albanian authorities enhanced to manage the coastal resources

Component One:

Interim coastal regulations developed, enacted and operational.

Most appropriate structure and functions for ICZM identified, established and functioning according to objectives and procedures agreed through wide consultation.

Cohesive and harmonized ICZM legal framework developed.

Integrated geographically-referenced land-use information management system is set up.

Environmental monitoring network for gauging quality of coastal waters is upgraded.

Southern Coast Development Plan developed and codified.

Component One:

Yr 1 through Yr 5 to determine improvements in central, regional and local capacity for ICZM.

Yr 4 through Yr 5 to assess whether Phase 1 triggers have been met

69

Protected areas management plan for Butrint National Park and World Heritage Site developed and site clearly demarcated.

Training to the relevant staff of the central and local administrations provided and new skills applied.

Component Two:

Targeted communities have improved critical municipal and regional infrastructure enabling environmentally sustainable tourism development in the southern coastal zone (from the Vlora Bay to the Greek border).

Component Two :

Municipal landfills for Saranda and Himara are designed, constructed and in operation.

A ferryboat and passenger terminal for the Port of Saranda is designed and constructed.

Number and value of grants provided to the communities of the Ionian Sea coast and Saranda municipality for improvement of public infrastructure and services, and for preserving local culture and architectural heritage, as part of the Coastal Village Conservation and Development Program

Component Two:

Yr 1 and Yr 5 to determine improvements in public infrastructure and environmental conditions in the southern coastal zone.

Yr 4 and Yr 5 to assess whether Phase 1 triggers have been met

70

Component Three:

Soil and groundwater contamination from a former chemical plant in Porto Romano is contained and the area environmentally rehabilitated.

Component Three:

Improved environmental indicators in the Porto Romano area.

Environmental monitoring system established.

Volume of polluted soil encapsulated.

Component Three:

Yr 3 to Yr 5 to determreduction of human heimpacts

Yr 2 to Yr 5 to determperformance of civil wcontract.

Yr 5 to assess whethertriggers have been met

Component Four:

Management capacity within implementing agencies improved.

Component Four:

Project funds disbursed according to plan, timely accurate project status reports, satisfactory financial and procurement records, and timely audits.

Increased public awareness on coastal zone issues and challenges.

Component Four:

Yr1 through Yr5 to gaimplementation progrequality of project coor

71

Annex 2. Project Costs and Financing (a) Project Cost by Component (in USD million equivalent)

Components Appraisal estimate19 (USD

millions)

Revised estimate20 (USD

millions)

Actual (USD

millions)

Percentage of appraisal

(%) Protected Areas Management Strengthening (formerly Integrated Coastal Zone Management Policy and Institutional Capacity Strengthening)

3.25 1.95 1.85 55

Coastal Environmental Infrastructure and Rehabilitation

29.24 26.74 23.69 94

Porto Romano Hot-spot Clean-up

4.48 4.28 4.21 107

Project Management, Monitoring and Coordination

1.49 2.10 2.54 170

Project Preparation 0.9 0.9 0.9 0 Total Baseline Cost 34.02 35.16 32.38 84

Physical Contingencies 2.76 0.00 0.00 0.00 Price Contingencies 1.78 0.00 0.00 0.00

Total Project Costs 37.21 Front-end fee PPF 0.00 0.00 0.00 0.00 Front-end fee IBRD 0.00 0.00 0.00 0.00

Total Financing Required 38.56 35.17 32.38 84 (b) Financing

Source of funds Type of cofinancing

Appraisal estimate

(USD millions)

Actual/latest estimate

(USD millions)

Percentage of appraisal

(%)

Borrower 5.71 5.34 95 Local communities 1.26 0.64 51 EC: European Commission 1.80 1.43 79 AUSTRIA, Gov. of (Except for Fed. Chancellery-DG Dev. Coop) (TF55922)

2.60 2.14 82

Global Environment Facility (GEF) (TF56176)

MSP Grant 0.95 0.3 32

NETHERLANDS, Govt. of THE (Except for MOFA/Min of Dev. Coop) (TF54400)

3.11 2.61 84

International Development Association (IDA)

17.50 14.7 84

JAPAN: Ministry of Finance - PHRD Grants (TF55065)

2.23 2.23 100

19 According to PAD from 2005. 20 Restructured project estimates, March 2010.

72

Annex 3. Outputs by Component

Components Outputs Monitoring indicators

Restructured Restructured Restructured Component A (e) Protected Areas Management Strengthening

Component A: Development and approval of the Protected Areas

Management Plan for Butrint National Park with wide stakeholder participation and consultations.

Social Assessment of the Butrint Management Plan completed.

Park infrastructure to enhance biodiversity values of the park constructed.

Component A Determine the increase in capacity of the Butrint National Park to manage the environmental park resource.

Component B1, B2, B3 Improvement of critical public environmental infrastructure and municipal services. Component B4 Community infrastructure improvements and revitalization and enhancement of architectural and cultural resources.

Component B1, B2, B3 Improved waste disposal infrastructure for the

southern coast built in Saranda with a capacity of 25,000 m3 per year and the accompanying transfer station in Himara.

Service contract signed with participating municipalities and communes for waste disposal.

Contract signed with landfill operator. Execution of environmental impact assessment

(EIA) in accordance with EIA procedures. Reconstruction of port facilities to allow access of

cruise liners to facilitate passenger access to the southern coast.

Architectural design completed for Butrint National Park Visitors Center within the port area.

Reconstruction of the water supply and sewer networks in Saranda.

Construction of wastewater outlet from the WWTP in Saranda to the Chuka Channel.

[12.5] km Navarica trunk main replaced and existing reservoir (1000 m3) rehabilitated.

Component B Gauge the improvements in public infrastructure and environmental conditions in the Southern Coastal Zone.

Component C Remediation and containment of pollution hazards from a former chemical plant in Porto Romano.

Component C Risk assessment undertaken for the hot-spots. Resettlement of the families on the former site

completed in accordance with the agreed Resettlement Action Plan.

Landfilling and encapsulation of 45,000 m3 of hazardous waste on one of the sites.

Infrastructure for site monitoring in place. Aftercare program for the Porto Romano site agreed

and signed by MoEFWA and Municipality of Durres.

Component C Determine if the contamination has been removed in a proper manner to reduce the environmental health risks to acceptable standards.

Determine if the facility has been constructed in line with design conditions.

73

Measure the effectiveness of the containment through inspections and monitoring.

Component D Improvement of Project Management and Monitoring

Component D Project funds disbursed according to plan; timely

and accurate project status reports and financial and procurement records; timely audits

Increased public awareness of coastal area issues and challenges of sustainable protection of natural and cultural resources.

Component D Gauge implementation process and quality of project coordination.

OUTPUTS BY COMPONENT PRIOR TO RESTRUCTURING IN 2010 Component A: Integrated Coastal Zone Management Policy and Institutional Capacity Building (US$3.63 million: US$2.10 million IDA; US$0.92 million PHRD; US$0.36 million GEF; US$0.25 million GoA)21 Component Description. Component A comprises two subcomponents: (i) strategic policy support, and (ii) coastal management strengthening. 1. Subcomponent A.1 Strategic Policy Support (US$0.554 million). This included

technical assistance to support the development of the policy and legal framework for integrated coastal zone management and the development of a financial and economic incentive framework for integrated coastal zone policy and management. The specific areas for technical assistance included: review of national policy, legislation, institutional arrangements for coastal

management; preparation of interim regulations; identification of appropriate legal and institutional framework for integrated coastal

zone management, including assessment of alternative institutional arrangements (e.g., Integrated Coastal Zone Management Council and Coastal Authority); and

development of a coastal zone management law (which will codify in legislation the decision-making process set for coastal management, institutional arrangements, management approaches, procedures for environmental review, definition of public and private rights and obligations, monitoring, and other relevant provisions).

2. Subcomponent A.2 Coastal Management Strengthening (USS3.073 million). The

Project will help strengthen capacity at the central, regional, and local levels to increase the efficiency and effectiveness of the regulatory, planning, and management functions

21These include GEF and PHRD costs which are not included in Annex 2 (Table (a) above)

74

for integrated coastal zone management. The project supported strengthening the following: a. Regulatory capacity b. Capacity for resolution of disputes c. Integrated coastal zone management capacity d. Environmental management e. Protected areas management f. Land-use and spatial planning

Component B: Southern Coastal Environmental Infrastructure and Rehabilitation (US$28.78 million: US$14.09 million IDA; US$5.20 million EU; US$2.6 million Government of Austria; US$0.58 PHRD; US$0.45 million GEF; US$1.26 million beneficiaries; US$4.58 million GoA) 3. Subcomponent B.1 Southern Coastal Solid Waste Management (US$6.20 million). The

project was expected to finance the construction of two municipal landfills in Saranda and Himara to serve the municipalities and the surrounding communes/villages, as well as the equipment needed for operation of the landfills and collection/transport of solid waste to the landfills (e.g., containers, compactors, collection trucks, vehicles, and cleaning equipment). The project was also expected to finance a construction and demolition waste pilot project to reduce the amount of scattered debris, through targeted collection and disposal of such waste in the landfills.

4. Subcomponent B.2 Saranda Gateway (US$5.98 million). The project was expected to

support the transformation of Saranda’s downtown port into a dedicated ferryboat and passenger terminal to facilitate the access of passengers and vehicles to south Albania in line with the general recommendations of the Albania National Transport Plan and the Master Plan for Saranda Port.

5. Subcomponent B.3 Sewer and Water Supply in Saranda Tourist Area (US$3.00 million).

The project was expected to support the following works: extension of sewer in the tourist area of Saranda; extension of the water supply system of the same area and roads surface works; and investment costs associated with changing the point of discharge of the treated effluent from the Saranda constructed wetland to the Ionian Sea via the Chuka canal.

6. Subcomponent B.3 Coastal Village Conservation and Development Program

(US$13.60 million). This component was expected to support the establishment of a Coastal Village Conservation and Development Program (CVCDP) for the following types of infrastructure improvements: (i) public utility infrastructure for environmental protection of traditional and nontraditional villages—inter alia, improvements to sewerage and wastewater treatment, potable water supply, and access roads from the main road; (ii) cultural heritage (e.g., churches, forts, castles, and caves) protection and enhancement investments (selected on the basis of on-site management plans) including, inter alia, landscaping, interpretation and signage, protection measures, lighting, and improved access (internal paths, stairs, and streets) to these sites; (iii)

75

sustainable tourism infrastructure on beach development areas; (iv) revitalization and enhancement of traditional villages; and (v) revitalization of vernacular architectural heritage. Infrastructure investments for sustainable tourism were to focus on the nontraditional village areas adjacent to and/or serving beach tourism, including, inter alia, street improvements, development and enhancement of public spaces and parks, traffic circulation and control, parking, and tourism information centers. Investments for revitalization and enhancement of traditional villages were to include, inter alia, landscaping, improvement of internal paths and streets, street lighting, traffic circulation and control, and parking. Investments of revitalization of vernacular architectural heritage were to include, inter alia, façade stabilization and painting, and roof repair, when necessary.

Component C: Porto Romano Hot-Spot Clean-Up (US$4.46 million; US$0.15 million IDA; US$3.11 Government of The Netherlands; US$0.88 million GoA; US$0.31 million PHRD) 7. The components and outputs included (i) strengthening of implementation capacity at

the MoE and assistance in supervision; (ii) capacity building in soil pollution remediation as well as performance monitoring and raising community awareness to reduce environmental health risks; (iii) remediation and rehabilitation of Porto Romano in an environmentally sound and cost-effective manner; and (iv) establishment of a long-term hydrogeological and environmental monitoring program.

Subcomponent C.1 Strengthening Implementation Capacity (US$0.21 million). Subcomponent C.2 Hydrogeological and Environmental Monitoring (US$0.15 million). Subcomponent C.3 Remediation and Rehabilitation Works (US$3.90 million). Subcomponent C.4 Resettlement Plan Implementation (US$0.10 million). Subcomponent C.5 Land Use and Management Plan for Porto Romano (US$0.10 million).

Component D: Project Management and Monitoring (US$1.63 million; US$1.07 million IDA; US$0.15 million GEF; US$0.41 million PHRD) 8. This component was expected to support project management, coordination, and

monitoring and evaluation through:

Subcomponent D.1 Project Coordination Support (US$0.63 million). Subcomponent D.2 Project Implementation Support (US$0.65 million). Subcomponent D.3 Monitoring, Evaluation and Communication Support (US$0.35 million).

76

Changes in PDO and Key Indicators, with Justification

Original PDO (according to PAD, dated May 25,

2005)

Revised PDO (according to Project

Restructuring Paper, dated March 22, 2010)

Explanation/justification

To set up and initiate an integrated coastal zone management approach to reduce coastal degradation through (i) strengthening regulatory policy and governance of the coastal zone, land use and regional planning and institutional capacity; (ii) initiating targeted municipal and community investments in the southern coast to improve environmental conditions, enhance cultural resources, and encourage community support for sustainable coastal zone management; and (iii) reducing soil and groundwater contamination in the former chemical plant at Porto Romano.

To assist the Government of Albania in developing, on a sustainable basis, tourism in the South Albania coast by (i) improving critical public environmental infrastructure and municipal services, (ii) remediating and containing pollution hazards from a former chemical plant in Porto Romano near Durres, (iii) improving community infrastructure, and (iv) enhancing architectural and cultural resources.

Primary focus on integrated coastal zone planning/management and reducing coastal degradation shifted to tourism development, giving primacy to significant need for environmental infrastructure in the southern coast to promote tourism development. It was decided to focus on support for critical infrastructure for improving the environmental and sanitary conditions essential for long-term coastal development and tourism. The changes did not affect the original implementation arrangements, the financial management and procurement arrangements, and the safeguards category of the project.

77

No.

PDO Key Indicators

Original Revised or dropped during Level 1 Restructuring (March 22, 2010)

Explanation/justification

1 Completion and approval of the SCDP (Southern Coastal Development Plan) by the National Council of Territorial Adjustment.

Dropped as PDO indicator Completed before restructuring. The SCDP, including Strategic Environmental Assessment of the plan, was developed and approved by the National Council of Territory Adjustment in July 2008.

2 Development of public infrastructure in the southern coastal area in compliance with the SCDP.

Revised as “Development of port infrastructure” (Indicator 3).

More specific and targeted indicators.

3 Local land-use planning and issuing of construction permits in the southern coast in compliance with the parameters and measures set forth in the SCDP.

Dropped as PDO indicator Based on the findings of the Inspection Panel case and subsequent discussion with the government, the team recognized the sociopolitical complexity and lack of public consensus around the issue of land-use planning and construction permits. The team felt that project objectives could be achieved similarly by focusing on critical infrastructure for improving the environmental and sanitary conditions essential for long-term coastal development and tourism. Participation of stakeholders in decisions on coastal infrastructure was mainstreamed into various activities to ensure stakeholder involvement and commitment to protection of coastal assets.

4 New buildings in the southern coastal area do not disturb the existing spatial value and characteristics.

Dropped as PDO indicator

5 Local, regional, and national physical planning efforts and development initiatives aligned with the principles and guidelines of the SCDP.


6 Stakeholder participation incorporated into coastal zone management decisions.

Dropped as a separate stand-alone PDO indicator

7 At least 5,000 tons of household waste and 5,000 tons of construction and demolition waste actually collected and disposed in proper facilities.

Revised as “Improved management of municipal solid waste and safe disposal in the Southern Coast according to EU standards” (Indicator 2).

The solid waste component was refocused on securing proper disposal of municipal solid waste. A study on construction and demolition was launched by the Government outside the project as it was considered more efficient to collect and reprocess construction and demolition waste near the point of generation; the Government also focused on improving enforcement of the law prohibiting quarry operators and construction companies from illegally dumping construction and demolition waste.

8 At least 50 % of tourist wastewater load in Saranda collected and treated.

Revised as “Improved water supply sewerage network of the city of Saranda” (Indicator 4).

This was considered important and specific to achieve the PDO.

78

9 At least 50% of public beaches and shellfish areas in the southern coast monitored for water quality against Albanian and EU standards.

Dropped as PDO indicator Was not considered essential for the revised PDO.

10 Tourism and visitor revenues in the southern coast of Albania increased and benefited wider communities.

Revised as Indicator 5, “Development of tourism-related infrastructure with active participation of coastal communities,” and Indicator 6, “Enhancement of traditional village architecture and small-scale bed and breakfast services.”

Improving critical public environmental infrastructure, municipal services, and community infrastructure was considered important to increase tourism revenues and benefits in the southern coast of Albania.

11 Protected Areas Management Plan for Butrint National Park developed with wide stakeholder participation and rules enforced through appropriate by-laws.

Revised as “Improved management of the Butrint National Park and provision of critical park infrastructure” (Indicator 7).

Preparation of the Butrint Protected Area Management Plan was supported through a Social and Legal Assessment carried out by the borrower to inform the process of assigning zoning regimes in the park area.

12 Detailed regulatory plans formulated, adopted and enforced by at least three coastal municipalities and/or communes.

Dropped as PDO indicator As agreed, all activities and indicators related to land-use and urban planning were dropped.

13 Zoning and local land-use plans (local strategic plans) formulated and adopted by at least five communes located in the southern coast.


14 Execution of Environmental Impact Assessment (EIA) in accordance with the EIA procedures and in compliance with Albanian law before obtaining environmental permits and starting construction and development activities in the southern coastal area.

Dropped as PDO indicator For all infrastructure investments financed under the ICZMCP, EIA preparation and public consultations is a requirement before obtaining environmental permits and starting construction. These provisions are included in the law of the land.

15 Enhanced economic incentives to promote integrated coastal zone management objectives introduced and actively used by regional and local governments.

Dropped as PDO Indicator This was in line with the revision of the PDO.

16 Reduction of soil contamination in areas adjacent to population centers in Porto Romano guided by the land-use plan formulated and adopted by the Municipal Council of Durres.

Revised as “Reduction of human health hazards in the Porto Romano area” (Indicator 1)

No land-use plan was prepared under the restructured project.

79

Annex 4. Environment and Social Safeguards Summary 1. The Albania Integrated Coastal Zone Management and Clean-up Project (ICZMCP)

was assigned an Environmental Assessment (EA) Category of Financial Intermediary (FI), since specific details of physical investments were not known at the time of appraisal. Accordingly, an Environmental and Social Safeguards Framework (ESSF) document was prepared to address environmental, land acquisition, and cultural property issues associated with physical investments and protected areas management planning activities. The ESSF was prepared through public consultations (including meetings in Orikum and Himara on April 7, 2005, and in Saranda on April 8, 2005) to ensure that the infrastructure subprojects implemented through the ICZMCP would comply with Albania’s laws, regulations, and customs, and it was adopted by the Government as a condition of negotiation. The ESSF was revised on February 23, 2010 (and re-disclosed in Albania on February 23, 2010, in English and Albanian and through the InfoShop). The project triggered the following safeguard policies: OP/BP 4.01, Environmental Assessment; OP/BP 4.11, Physical Cultural Heritage; and OP/BP 4.12, Involuntary Resettlement. All required safeguard documents, including the ESSF, Environmental Management Plans (EMPs) and Resettlement Action Plans (RAPs), were appropriately prepared, consulted on, and disclosed.

2. Compliance with the World Bank’s safeguards policies before the Inspection Panel (IP) investigation in 2009 was unsatisfactory. The IP considered the initial decision not to apply OP/BP 4.12 to the activities relating to coastal zone planning to be a root cause in the mishandling of demolitions in the village of Jale. The Bank team’s ineffective application and poor supervision of the Bank’s safeguards policies may have led the team to overlook the problems brewing on the southern coast. From the project restructuring in March 2010 until project closure in March 2015, safeguards compliance was satisfactory.

3. During implementation, component-level and site-specific Environmental Impact Assessments (EIAs) with EMPs were prepared, discussed with stakeholders, and publicly disclosed. The environmental due diligence documents were prepared and implemented for all subcomponents. On the basis of these documents, local environmental permits were obtained according to Albanian environmental regulations. For all project components, the PCU ensured that EMPs were included in the works contractors’ agreements, and no major noncompliance with EMPs was encountered during implementation of civil works. Safeguards requirements for small-scale community investments under the CVCDP followed the safeguards provisions outlined in the Project Operational Manual. The PCU’s capacity to monitor the implementation of EMPs increased through targeted capacity building, as international environmental advisors supported the implementation of major infrastructure components. There are some concerns related to follow-on monitoring of the Porto Romano CDF site according to the Aftercare Management and Maintenance Plan (AMMP). These concerns are partially mitigated by the approval/signing of the AMMP by the

80

MoEFWA, Durres Municipality, and Durres Regional Environmental Agency (REA), which are the three parties responsible for budgeting for and implementing the AMMP. While the monitoring results for the first year of AMMP implementation are in line with targeted site parameters, there is a lack evidence of regular monitoring by REA.

4. The project’s safeguards approach, including the triggering and application of specific policies, particularly the policy on involuntary resettlement, was the subject of an IP investigation, and a Management Action Plan was prepared to address the social safeguards concerns. The IP investigation was prompted by the Government’s demolition of several houses in the southern coast of Albania, and a claim made by the affected people that the demolitions were linked to the ICZMCP. The requesters claimed that in 2007 the Construction Police of the Municipality of Vlora, in line with the Southern Coastal Development Plan (SCDP) supported by the World Bank project, totally or partially demolished their permanent residences. The Bank was accused of not carrying out effective supervision efforts to stop or mitigate these violations. The requesters claimed that while there are many similarly situated and built communities along the coastal area, the Construction Police targeted Jale selectively, because of the desire of some public officials to clear space for a resort at and around the site of the demolitions. Accordingly, they suspected “public officials of having special private interests in the area” and claimed that the Bank did not perform adequate oversight and monitoring of the activities of the SCDP.

5. Bank Management in its response asserted that there was no direct or indirect linkage between the project and the demolitions that were the basis of the request. The team stated that the demolitions were part of an ongoing Government program started in 2001, and that they could not possibly be linked to the SCDP, which was not in effect at the time of the complaint. Therefore, Management contended that the Bank policy on involuntary resettlement (OP 4.12) did not apply to land-use planning activities such as the SCDP, and would apply only to possible land acquisition for the purpose of enabling specific infrastructure investments following the adoption of the SCDP. However, Management did acknowledge the need for improvement in the relevant country laws and their application and stated that future implementation of the SCDP will include social due diligence measures to protect vulnerable people. Bank Management had recommended to the Government that it mitigate the negative impacts, including (a) defining transparent criteria for identifying illegal buildings for demolition, (b) defining eligibility criteria for assistance, (c) defining a package of assistance, and (d) conducting public outreach and dissemination efforts. In addition, Management advised the Government to put on hold future plans for demolitions until these criteria were developed and agreed with the Bank.

6. The IP investigation concluded that the initial decision not to apply OP/BP 4.12 at the decisive stage of appraisal and during implementation was a root cause in mishandling of the Jale demolitions. This, and the failure to effectively safeguard the project through an agreement with the Government to suspend demolitions in the project area, had negative consequences for the affected population and for the Bank’s reputation. The Panel recommended that the Bank should have used the demolitions in Jale to

81

reexamine with the Government of Albania the project’s entire approach to demolitions, and to reconsider the applicability of the Bank’s OP/BP 4.12. Shortcomings were found in the quality of Bank supervision (as per OP/BP 13.05), which may have led to a problematic Management Response. As part of the discussion on the IP investigation, the Bank team acknowledged “serious errors in project preparation and supervision, along with errors in communication with the Board of the World Bank,” and the team agreed to an Action Plan for addressing the issues identified by the Panel. The Action Plan measures included (a) a case-by-case legal review of the April 2007 demolitions in the project area; (b) the appointment of an independent observer to monitor the legal review and report back to the Bank; and (c) the payment of legal aid for the review of each of the requesters’ claims. The team also agreed to supervise the completion of a Social Vulnerability Assessment and the retroactive application of the resulting assistance packages for the poor and vulnerable people affected by the demolitions. The Management decision on the ICZMCP had a far-reaching effect on how safeguards policies are interpreted and applied in projects across the Bank. To clarify the interpretation of ambiguous aspects of OP 4.12, Management prepared and issued a guidance note to address environmental and social issues in projects that support land-use planning.

7. At the project closure in March 2015, there were no outstanding social or environment safeguards issues. The only remaining issue—compensation payments for the acquisition of 3.2 hectares from 21 project-affected people required for the Bajkaj landfill—was resolved before the project closure date. In 13 cases full payments have been made, and in 8 cases, the project-affected people are either deceased or living abroad, mostly in Greece. For all these pending cases, according to local law, the compensation money has been set aside in a special escrow account and is available in case absentee project-affected people or their legitimate heirs claim the payment. Regarding the Himara waste transfer station, the final location selected by Himara Municipality did not involve any economic or physical displacement of population. Regarding property titles for families resettled from Porto Romano, Durres Municipality and the Office of Property Registration have taken action to transfer the property title of the Government-provided replacement housing to the affected families. In all cases the families have been residing in the resettlement units for four years under better conditions than before resettlement, and their possession and tenure of the property is secured.

Safeguards Plan and Implementation by Project Component 8. Butrint National Park (BNP). An EMP was prepared following a comprehensive

process, in close collaboration and consultation with the residents of the area, local businesses, and other stakeholders. Public consultation meetings were held in the village of Mursi, Xarra Commune, in February 2009 and April 2009, and in Ksamil in October 2009. The EMP for BNP was supported by a Social and Legal Assessment of the impacts of the proposed investments. Additional public consultations on the EMP were held in August 2010: on August 12, 2010, in Vrina, Shendelli, and Ksamil; on

82

August 13, 2010, in Xarra and Ksamil; and on August 27, 2010, in Tirana. The Butrint EMP was approved by the Minister of MoE in June 2011.

9. Solid Waste Management investments. A regional sanitary solid waste landfill in Bajkaj (near Saranda) and a transfer station in Himara were financed under ICZMCP. As part of the EIA process, public consultations were held in Himara and Saranda on May 13, 2009, and a second public consultation was held in Saranda on July 15, 2009. Additional meetings were held in Vergo Commune on June 15, 2009, concerning the landfill construction. The draft EIA was disclosed in-country on June 30, 2009, and in the InfoShop on September 14, 2009, and the EIA was finalized in May 2010. Environmental permits were issued on September 2009 for both facilities, but because of the delay in starting works, renewal of permits was required; new environmental permits were issued on October 5, 2012.

10. Bajkaj Landfill. During implementation, Bajkaj and Palavli villagers raised concerns

about the location of the landfill site, the perceived increase in groundwater pollution, surface water pollution, and the foul smell from the proposed landfill. As part of the agreement with the community, two roads—the road from Stjari-Bamatati junction to Bajkaj, and the national Kardhiq-Delvine road—were rehabilitated. A RAP for landfill construction was prepared and implemented in compliance with World Bank operational policy (OP 4.12).

11. Himara Transfer Station. Finalization of the location and construction work for the

transfer station was delayed by complaints from the community and by illegal encroachment. A new location for the transfer station was subsequently identified by Himara Municipal Council, and a revised EIA was prepared. The EIA was disclosed on May 15, 2014, by the Ministry of Urban Development and Tourism and Himara Municipality.

12. Saranda Gateway Cruise Liner Terminal. A comprehensive EIA study was completed

for the Saranda port between November 2006 and June 2007. As part of the EIA process, public consultation meetings were held in Saranda on March 8 and June 7, 2007. The EIA study found the material to be dredged (mainly sandy, organic, and clay material) to be moderately contaminated, so a Risk-Based Engineering and Biological Assessment was carried out for relocating the soil to a proper location. The dredged material was disposed of properly.

13. Investment in Water Supply Network and Sewerage System in Saranda. The

preparation of an EIA was supported by public consultations. The recommendations of the EIA were reflected in the updated design for the investments.

14. Coastal Village Conservation and Development Program (CVCDP). The small-scale

community investments under the CVCDP followed the safeguards provisions outlined in the ESSF. All village investments under the CVCDP were identified and implemented through a highly participatory and inclusive process carried out according to the Program Implementation Guidelines and Operation Manual. Environmental

83

authorizations were obtained for all subprojects. The subproject for improving the sewerage system in Himara Municipality carried out a comprehensive EIA, including an assessment of expected impacts on the marine environment. Under the pilot Roof & Facades (R&F) and Bed & Breakfast (B&B) Programs, the EMP checklist was used to prevent and mitigate environmental impacts during construction. In addition, conservation guidelines, focusing on indigenous materials and conservation methods, were developed for and used by the participating villages.

15. Remediation and Clean-up of Porto Romano Hot-Spot. The EIA process for the

Porto Romano hot-spot and site remediation followed a highly consultative approach. The EIA for the Porto Romano remediation was disclosed in the country on January 30, 2008, and in the InfoShop on August 14, 2009. A RAP was prepared and implemented. As part of the Contractor and Supervisor contract, an Aftercare Management and Maintenance Plan (AMMP) was prepared and implemented to inform monitoring, maintenance, and repair works and delineate the responsibilities and measures to be taken to safeguard the facility in future.

84

Annex 5. Economic and Financial Analysis 1. The economic and financial analysis presented here uses different approaches to

evaluate the four subcomponents of the project’s Component B: Coastal Environmental Infrastructure and Rehabilitation. This is primarily due to the lack of specific monitoring data for each type of benefit during project implementation (e.g. tracking increases in tourism). This analysis also differs from the one performed at appraisal which included both an economic and financial analysis. The economic analysis measured the incremental benefits from increased tourism and weighed these against the total costs of all rehabilitated infrastructure (i.e. roads, water supply, sewerage and solid waste). It was assumed that tourism would grow at 3% per year after year 5 of the project and this would result in $2.2 million in additional tourism receipts by 2009, and $60 million by 2030. The economic rate of return associated with these benefits and costs was found to be 16%. In the analysis provided below we associate the benefits of increased tourism with the rehabilitation of the Saranda Port only – since this was the primary bottleneck for handling a greater number of tourists.

2. The financial analysis at appraisal included a tariff analysis for solid waste management and a revenue analysis of Saranda Port improvements. The solid waste tariff analysis calculated the minimum tariff required to cover O&M costs, plus varying percentages of capital cost recovery. It was found that the implied tariffs were below the affordability limits (i.e. as a % of household income) of typical tariffs charged in low income countries. Thus in the case of Albania, tariffs would have to be gradually adjusted upwards. The analysis supplied below takes into account the recently negotiated landfill gate fee by municipalities, and it calculates the net present value and internal rate of return associated with alternative waste generation rates and its effect on landfill capacity.

3. At appraisal, the financial analysis of the Saranda Port assumed an increase in

passenger traffic and a decrease in freight imports and the associated benefits were forecasted until 2025. It was found that revenues would cover forecasted fixed and variable operational costs which were $230,000 at appraisal and estimated to climb to $315,000 by 2025. In the below analysis we calculate the net present value and internal rate of return of port improvements taking into account the increase in tourism expenditures, varying the growth rate of arrivals and the length of stay by tourists.

4. This analysis did not quantify the following components: Component A: Integrated Coastal Zone Management Policy and Institutional

Capacity Building. Capacity building was not quantified, since linking change to outcomes is dependent on the effectiveness of the actions of those who were trained.

The pilot Roof & Facade Program, part of Subcomponent B.4. Conservation works were completed in 27 houses under this program, but a lack of data on the increase in visitation to these locations prohibited the evaluation of these benefits.

Component C: Porto Romano Hot Spot Clean-Up. The health benefits associated with a reduction in risk exposure are beyond the scope of this evaluation; it would

85

require a longitudinal study of individuals over time, accounting for any confounding factors such as lifestyle or behavior. This is discussed further below.

Component D: Project Management and Monitoring.

Subcomponent B.1: Southern Coastal Solid Waste Management22 Bajkaj landfill: US$4,427,880 Himara transfer station: US$608,504 of which: Government of Austria, OSTR grant: US$2,600,000

The landfill 5. The new landfill and transfer station serve approximately 86,700 residents - and during

the 4-month peak tourist season, approximately another 90,000 people. The total design capacity of the landfill is 365,000 m3 and with an annual receiving capacity of 25,000 m3. The anticipated lifetime of the landfill is approximately 10 years, with a potential extension to 17 years if recycling of glass, plastic, paper, and metals takes place.23 Currently the composition of waste is about 63% biodegradable, 25% recyclable, and 12% other types of waste, such as healthcare waste, rubber, e-waste, and insert waste. For the purposes of this analysis we use a constant 25% recycling rate from year 10 to year 17 once EU approximation with the Waste Directive takes place..

Waste generation 6. According to Albania’s Institute of Statistics (INSTAT), households in Vlore

Prefecture generated on average 535 tons of waste per inhabitant in 2013.24 This translates to about 1.46 kg/person/day - a bit higher than the average in Europe and Central Asia (1.1 kg/person/day),25 but less than the upper bound for the region (2.1 kg/person/day). The Albanian National Environment Agency also collects statistics on waste and in 2014 recorded 266 tons of waste per person per year, or about 0.7 kg/person/day. For the purposes of this assessment we take an average of 1.0973 kg/person/day. Population growth and increasing numbers of tourists will also increase waste generation in the future. For the purposes of this analysis we use the recent years’ rates of 0.3% for residential growth and 10% for tourism growth.

7. Taking into consideration the assumptions above on annual waste generation, Table 1 shows what the implied collection rate would be if only 25,000 m3/year were allowed

22 Please note that the following are the actual costs, while para 86 shows estimated component costs as $6.2 million. 23 The design lifetime of the landfill is 10 years; but as Albania harmonizes its environmental legislation with the EU acquis, recycling options will be implemented and can extend the lifetime to 17 years. 24 Annual quantity of waste - Ministry of Transport and Infrastructure. Resident population by prefectures – INSTAT. 25 Hoornweg, D. and P. Bhada-Tata (2012) What a Waste: A Global Review of Solid Waste Management, Urban Development Series Knowledge Papers, No. 15, Chapter 3, World Bank.

86

to be landfilled. What this says is that only 38% of all waste could be landfilled in the first few years, and declines with population and tourism growth. This is true even with recycling efforts beginning in year 10.

Table 1. Waste generation and implied collection rates

Year Landfill receiving capacity

Waste generation Waste generation1 Implied collection rate

(m3/year) (tons/year) (m3/year) (%) 1 25,000 46,569 65,407 38.22 2 25,000 46,569 65,407 38.22 3 25,000 48,240 67,753 36.90 4 25,000 49,971 70,184 35.62 5 25,000 51,764 72,702 34.39 6 25,000 53,621 75,310 33.20 7 25,000 55,545 78,012 32.05 8 25,000 57,032 80,101 31.21 9 25,000 58,559 82,246 30.40 10 25,000 60,127 84,448 29.60 11 25,000 61,737 86,710 28.83 12 25,000 63,391 89,032 28.08 13 25,000 65,088 91,416 27.35 14 25,000 66,831 93,864 26.63 15 25,000 68,621 96,377 25.94 16 25,000 70,458 98,958 25.26 17 25,000 72,345 101,608 24.60

1 – Assuming that each m3 of waste weighs 712 kg. Revenues 8. The current gate fee negotiated with the surrounding municipalities is US$14.50 per

ton. Assuming that 25,000 m3 of waste is collected and delivered to the landfill each year, gate fees would represent an annual revenue stream of approximately US$258,000 starting in year 4 of the project. Since 25,000 m3/year is the maximum receiving capacity – this revenue stream is constant despite population, tourism, and thus waste, growth. This revenue does cover annual operating and maintenance costs of $238,000, which begin in year 4, but will not keep pace with any cost increases such as inflation.26 To offset increases in costs, the tariff rate will have to rise annually and in this analysis we assume that the tariff rate rises 5% per year (Table 2).

26 O&M costs are approximately half of what was assumed in the original feasibility study for the design of the landfill, because the original design was double the current capacity of 365,000 m3. The feasibility study also found the tariff to cover operating and maintenance costs to be about $27/ton, but since the constructed landfill is half of the design size, a tariff rate of $14.50/ton is consistent with the design.

87

Table 2. Tariff rates and revenue generation Year Tariff rate Waste revenue

($US/ton) ($US) 1 14.50 258,100 2 15.23 271,005 3 15.99 284,555 4 16.79 298,783 5 17.62 313,722 6 18.51 329,408 7 19.43 345,879 8 20.40 363,173 9 21.42 381,331 10 22.49 400,398 11 23.62 420,418 12 24.80 441,439 13 26.04 463,511 14 27.34 486,686 15 28.71 511,020 16 30.14 536,571 17 31.65 563,400

Costs 9. The capital cost of the landfill and transfer station was US$5,036,384, and annual

operating costs of the landfill and transfer station were assumed to be approximately US$238,000. An OSTR grant was obtained during the project, and its purpose was to offset capital costs and reduce the tariff burden on the municipalities’ ability to pay. Thus the amount of this grant is subtracted from capital costs. The list below summarizes all the assumptions.

Main assumptions (units) Value Landfill capacity (m3/year) 25,000 Lifetime capacity (m3) 365,000 Life of landfill (years) 10-17 Weight of solid waste per cubic meter (kg/m3) 712 Capital cost disbursement in first 4 years (%) 15, 30, 30, 25 O&M 238,000 Landfill gate fee in first year of operation ($/ton) 14.50 Annual gate fee increase (%) 5.0 Population served 86,685 Tourists served (4 months/year) 90,000 Waste generation (kg/person/day) 1.10 Population growth rate (%) 0.3 Tourist growth rate (%) 10.0 Recycling rate after year 10 (%) 25.0 Discount rate (%) 12.0

88

Evaluation 10. Table 3 summarizes the evaluation and a sensitivity analysis of not including the OSTR

grant. Starting on the left, we see that including the grant, and only O&M costs, results in a positive net present value (NPV) in years 10 onwards and with an associated IRR of 12% in year 15. In the second set of columns, where capital costs are added, the NPV is negative as is the IRR in all years. In the third set of columns, taking out the grant, the NPV and IRR are both negative in all years.

11. Not included in these calculations are the associated health benefits (reduction in health

costs), since the landfill diverts unsanitary material and sources of health hazards from the population.

89

Table 3. Analysis of the landfill and transfer station (US$ million and IRR in %)

OSTR grant included – including only O&M costs

OSTR grant included – including capital and O&M costs

OSTR grant not included – including capital and O&M costs

Year Revenue Costs NPV IRR Revenue Costs NPV IRR Revenue Costs NPV IRR

10 1.19 1.13 0.05 5% 1.19 3.11 (1.92) - 1.19 5.28 (4.10) -15 1.58 1.37 0.22 12% 1.58 3.34 (1.76) -18% 1.58 5.51 (3.93) -20 1.96 1.54 0.42 15% 1.96 3.52 (1.56) -11% 1.96 5.28 (3.13) -15%25 2.23 1.64 0.59 16% 2.23 3.62 (1.39) -7% 2.23 5.79 (3.56) -11%

90

Subcomponent B.2: Saranda Gateway27 Cost: US$4,610,933 12. The new Saranda Gateway Cruise Liner Terminal can service a growing tourist

population and cruise liners of larger capacities. Works included a new 180 m quay wall with a waterfront depth of 9m and the surrounding infrastructure to support this increase in visitation. The anticipated life of the port is 20 years, and annual operating costs are approximately $276,000, according to the design feasibility study.28

13. Passenger arrivals to the port have grown in the past few years, even before the works

were completed in September 2014 (Table 4). This can be partly explained as the coast being an attractive, and economical, destination for European travelers, and now, the port’s ability to accommodate a greater number of tourists. As of October 2015, 29 cruise liners docked at the quay wall, up from 7 in 2013, and overall passenger traffic rose by 25%. The first large cruise liners visited Saranda in September and October of 2014 after works were completed.29 There was a decrease in Albanian arrivals – partly reflective of a more general travel decline by Albanians that year, but also since arrival statistics only being available until October.

Table 4. Saranda Port arrivals and departures

Description Entity 2013 2014 2015 (until Oct)

% change (2013-2015)

Total number of passengers embarked + disembarked

passengers 132,162 163,481 166,199 25.8

Embarked passengers 66,460 81,370 83,565 25.7 Albanian passengers 12,452 12,865 10,551 -15.3 Foreigners passengers 54,008 68,505 73,014 35.2

Disembarked passengers 65,702 82,111 82,634 25.8 Albanian passengers 12,194 13,166 10,142 -16.8 Foreigners passengers 53,508 68,945 72,492 35.5

Docking of touristic ferries units 202 183 170 -15.8 Cruise lines units 23 30 36 56.5 Cruise line in quay units 7 24 29 314.3 Touristic yachts 377 489 433 14.9

Source: JSC Sea Port Saranda, 2015.

27 Please note that the following are the actual costs, while para 87 shows estimate of $5.98 million as full capital costs. 28 “Southern Albania Maritime Front Study – Final Report,” Marnet S.A., in collaboration with Trademco S.A. 29 There are plans to increase the depth to accommodate even larger craft, such as the Queen Elizabeth.

91

14. The main assumptions of the evaluation are included in the table below. We include only those passengers who disembarked, to avoid any double counting, and we conservatively assume a 10% growth rate in arrivals after project completion – which is lower than the observed increase of 35% from 2012 to 2015 by foreigners, and higher than the 16% decrease in Albanian arrivals. We also use this growth rate in the sensitivity analysis to understand the impact on benefits.

15. Expenditures by tourists are a benefit to the local economy. However, since there are

costs associated with the purchase of goods and services, we include as a benefit only the value-added tax (VAT), which is currently 20% on all goods and services. The list below presents average tourism expenditures that are converted to US dollars and then subject to the 20% VAT. Passenger revenues from the project begin in year 4 of the assessment. According to a Tourism Satellite Account Study30 conducted in 2010, international (foreign) visitors were spending on average 82 Euros/day during an average stay of 5 days, while for leisure (local) tourists the average stay was 2.8 days. In this analysis, and the sensitivity analysis, we assume that passengers who arrive, stay between 1 and 3 days. A discount rate of 12% is also used for the evaluation.

Main assumptions (units) Value Capital cost (US$) 4,610,933 Capital cost disbursement in first four years (%) 15, 30, 40, 15 O&M beginning in year 4 (US$) 276,000 Number of foreign passengers (disembarked) 53,508 Number of Albanian passengers (disembarked) 12,194 % increase in foreign tourists from project 29 % increase in Albanian tourists from project 8 Incremental increase in # of foreign tourists 15,410 Incremental increase in # of Albanian tourists 976 Annual growth in arrivals after project completion (%) 10 Average length of stay (days) 1-3 Lifetime of port (years) 20.0 Discount rate 0.12

Tourist expenditures Euros 2014 ferry cost from Corfu (each way) 19 Euros; 23.80 Euros from mid-June to mid-July

19.00

Cost of 1-night hotel stay 37.50 Amount spent on food per day 25.00 Amount spent day-shopping 30.00 Taxi to Butrint 10.00 Admission fee at Butrint (700 ALL foreigners) 6.14 Admission fee at Butrint (300 ALL Albanians) 2.63 VAT on goods and services (%) 20.00

30 Strengthening Tourism Statistics and Development of a Tourism Satellite Account. Experimental TSA 2009. Final Report, SNV and Ministry of Tourism, Culture, Youth and Sports, April 2011.

92

USD/Euro 0.9040 USD/ALL (1 USD = 126.15 ALL) 126.15

16. Many tourists arrive in Saranda by cruise liner or ferry, often from Corfu as part of a

package tour. One of the main nearby attractions is the UNESCO World Heritage site of Butrint, with archeological sites and remains dating back to the 7th century BC. Ferry rides from Corfu to Saranda average €19 each way in the low season and €23.80 in the high season. For this analysis we use only €19, and include admission fees and spending while in Butrint.

17. The results are provided in Table 5. In the case of a 10% increase in tourists and an

average 3-day stay, with a discount rate of 12%, the NPV is $12.82 million and the IRR 26%. Varying the assumption on the growth in arrivals appears to not influence either the NPV or IRR very much, however, varying the length of stay from 1 to 3 days doubles the NPV and IRR.

Table 5. Results and sensitivity analysis of the Saranda Gateway (NPV in US$ million and IRR in %)

Growth in arrivals (%)

Length of stay (days)

1 5 7 10

1 5.06 13%

5.42 13%

5.60 14%

5.87 14%

2 8.28

19% 8.75 19%

8.99 20%

9.34 20%

3 11.51

24% 12.09 25%

12.38 25%

12.82 26%

93

Subcomponent B.3: Sewer and Water Supply in Saranda Tourist Area31 Cost: US$3,210,650 18. The sewer and water supply rehabilitation in the Saranda tourist area consisted of the

main works listed in Table 6, serving a population of approximately 40,000 people, and about twice that number during the high tourist season (about 4 months). Table 6. Rehabilitation works

Works Length (km)

Navarica Transmission Main 12.90

Tourist area 2.35

Pressure line from WWTP to Cuka Channel 1.92

Sewer lines in town 2.10

Navarica village 1.00

19. According to current plans, tariffs imposed on households and other entities will

increase (Table 7), although by a declining percentage, at least until 2018 (Table 8). These tariff levels are generally considered not high enough to recover the full capital costs of US$3.2 million. Thus a bottom-up tariff analysis would likely yield a negative NPV and IRR. The lack of detailed information on O&M costs also restricts an assessment of whether tariffs cover these costs.

20. To gauge whether these investments were cost-efficient, we benchmark the costs—that

is, we compare the costs per capita served with other water supply and sanitation (WSS) projects that were shown to be cost-efficient. Conservatively, if the investment cost were divided by only the served domestic population (40,000 people) this would represent a cost of US$80/person. In the Albania Durres Water and Sanitation Rehabilitation Project and Water Supply Urgent Rehabilitation Project,32 it was found that average investment per capita was about US$84, based on the total served population. For a typical rehabilitation project, this was considered reasonable, taking into account the major overhauls required and the costs of projects undertaken by other donors.33 Thus benchmarking these results with those of other similar WSS projects in Albania indicates that these investments appear to be cost-efficient.

31 Please note that the following are the actual costs, while para 88 shows estimate of $3 million as full capital cost. 32 Albania: Durres Water and Sanitation Rehabilitation Project and Water Supply Urgent Rehabilitation Project, Project Performance Assessment, Report No. 31626, 2005, page 10. Interventions included: rehabilitate well heads and replace pumping and electrical equipment, and rehabilitate three feeder mains; reconstruct distribution mains, and rehabilitate well field, three pumping stations and replace mechanical and electrical equipment; reconstruct the gravity transmission main from Navarice spring and feeder mains to villages. 33 The Durres Municipality observed (Annex C of the above report): “We see that the average investment per capita was US$84, which is a very low financing figure compared with the financing rate in the same sector by the other donors. For example KfW was financing an average more than US$300/capita in the other cities in Albania for similar projects.”

94

Table 7. Tariffs 2011 – 2014 (ALL - Albanian Leks)

2011 2012 2013 2014 Water supply Domestic 40 ALL / m3 44 ALL / m3 44 ALL / m3 50 ALL / m3 Commercial 110 ALL / m3 120 ALL / m3 120 ALL / m3 135 ALL / m3 Institution 90 ALL / m3 120 ALL / m3 120 ALL / m3 135 ALL / m3 Wholesale Supply 25 ALL / m3 25 ALL / m3 25 ALL / m3 30 ALL / m3 Sanitation Domestic 14 ALL / m3 16 ALL / m3 16 ALL / m3 18 ALL / m3 Commercial 20 ALL / m3 25 ALL / m3 25 ALL / m3 28 ALL / m3 Institution 20 ALL / m3 25 ALL / m3 25 ALL / m3 28 ALL / m3 Monthly Service Tariff 100 ALL / m3 100 ALL / m3 120 ALL / m3

Table 8. Strategy on tariff regulation (ALL - Albanian Leks)

2014 Current

2015 2016 2017 2018

A. Water supply Domestic Increase % 14 10 10 5 5

ALL/m3 50 55 61 64 67 State institutions Increase in % 13 10 10 5 5

ALL/m3 135 149 164 172 181 Commercial Increase in % 13 10 10 5 5

ALL/m3 135 149 164 172 181 Wholesale Supply (Communes)

Increase in % 20 10 10 5 5 ALL/m3 30 33 36 38 40

B. Sanitation Domestic Increase in % 13 10 10 5 5

ALL/m3 18 20 22 23 24 State institutions Increase in % 12 10 10 5 5

ALL/m3 28 31 34 36 38 Commercial Increase in % 12 10 10 5 5

ALL/m3 28 31 34 36 38 C. Fixed Charges (monthly) Increase in % 20 30 10 5 5

ALL/m3 120 156 172 180 189 Note: From 2013, communes are not supplied with wholesale supply.

95

Subcomponent B.4: Coastal Village Conservation and Development Program (CVCDP) Roads and Rehabilitation of Town Squares34 Cost: US$3,884,454 (IDA Credit and EU Grant) 21. One of the implicit objectives of the CVCDP was to support the development of areas

for greater tourism. Under this component a number of roads, pathways, and town squares were rehabilitated to improve access by residents and tourists to beach areas and to help promote better-quality tourism in villages. The CVCDP component was completed in two distinct phases, but for the purposes of this analysis the interventions have been combined. Since specific tourism numbers were not available for every project at the time of completion, it is difficult to ascertain the tourism benefits from these interventions. However, we do know how many inhabitants benefited from these projects, and we can use the benchmarking approach taken above to gauge the relative cost-effectiveness of investments.

22. For roads, a typical metric is to look at the investment cost per kilometer. Table 9

calculates this number at an overall average of about US$257,000/km. It should be noted that several of the projects cost more than this average since they also included rehabilitation of village squares, roads with drainage and sidewalks, trees planted, street lighting, and so on. In addition, the type of road rehabilitation affects cost. In some cases roads were paved with asphalt, whereas other smaller sections were reconstructed with cobblestone or stone. The results should be interpreted with this background context.

23. In the previously completed Albania Secondary Local Roads Project,35 the average cost

per km for road works was approximately US$200,000. The road works involved upgrading the roads to paved standard with an average asphalt concrete surface thickness of 80 mm and partial widening to bring the average road width to 5.5 meters. At appraisal, the road improvement works costs were estimated, which included the pavement works and off-carriageway works such as shoulders, footpaths, safety devices, road markings, and land acquisition.

24. Comparing the figures in Table 9 with the $200,000/km benchmark, we see that costs

for some roads and works—for example, in Orikum Municipality—are dramatically higher. In these instances the difference can be explained by the additional cost of constructing smaller roads, with more labor-intensive materials (i.e., cobblestone instead of asphalt), supporting infrastructure such as streetlights and walkways, and revitalizing town squares. Road construction and site-specific restoration of this type

34 Please note that the following are the actual component costs, while capital costs estimate is $13.6 million. 35 Albania: Secondary Local Roads Project, Implementation Completion Report No. ICR2750, 2013, page 30.

96

raises the cost of a typical road project. Unfortunately, the change in the number of tourists for these interventions were not adequately collected so the direct benefits are difficult to assess. However, when these sub-projects are compared to conventional road investments many of them are still in line with the benchmark.

97

Table 9. Coastal Village Conservation and Development Program (CVCDP): Roads and Rehabilitation of Town Squares

Location Capital

cost (USD)

Length (km)

Square (m2)

Cost per km

HIMARA MUNICIPALITY

Improve monastery beach road and parking surfaces for Ilias village 319,850 2.600 123,019

Reconstruction of main road and construction of a new village street, secondary Palase 256,184 1.200 213,487

Reconstruction of main square and streets around village Dhermi 73,689 0.205 359,459

Improve system beach road and parking surfaces for Qeparo 155,606 0.476 1,004 326,903

Rehabilitation and cobblestone paving of village paths of Allonja Quarter (Dhermi) 176,428 0.410 430,312

Upgrade of road to Saint Theodore Monastery and the square in front of Monastery (Ilias) 65,544 0.380 172,484

LUKOVA COMMUNE

Access path/road to Borshi castle from Qark - level road and parking, Borsh 148,148 0.613 303 241,677

Construct new secondary access road, Nivice 113,501 0.270 420,374

Upgrade of village square and surrounded streets (Nivice) 158,673 0.700 250 226,676

Upgrade and organize of village center (Piqeras) 80,008 2,000

ORIKUM MUNICIPALITY

Construction of new ring road in the city of Orikum 1,015,593 1.300 781,225

XARRA COMMUNE

Reconstruction of entrance road from the national road to village square, surrounding streets and organize village's square (Xarra)

227,055 0.815 2,000 278,595

KSAMIL COMMUNE

Construction and organizing of new center (Ksamil) 166,147 2,000

ALIKO COMMUNE

98

Location

Capital cost

(USD)

Length (km)

Square (m2)

Cost per km

Reconstruction of road that links the square of Pllake/Qenurio villages with national road and organize the square of the Qenurio village (Pllake/Qenurio)

262,894 1.200 219,078

VERGO COMMUNE

Reconstruction of road that connects Bajkaj village with Palavli village to the bridge of Gjovraka (This road is used by all villages of Vergo Commune)

429,660 4.005 107,281

Reorganization of the squares of Bajkaj and Palavli villages and rehabilitation of entrance roads to the squares (Bajkaj and Palavli)

235,474 0.900 1,500 261,638

Total 3,884,454 15.074 9,057 257,692

99

Water Supply and Sanitation Improvements Cost: US$3,067,965

25. Works under this CVCDP component, listed in Table 10, consisted mainly of

improving water supply reliability and sewage connections in small villages adjacent to the coast. As in the WSS interventions under Component B3 in Saranda, the tariff structure in these villages does not allow for a full cost-recovery analysis, so we considered using the benchmarking approach. Using the same benchmark of US$84/person, all of the investments exceed this threshold by a factor of two or three times. However, in several villages new water reservoirs were constructed to improve the availability of water supplies (e.g., Palase, IIias, Qeparo, Lukova, and Bajkaj-Palavli), and many cases also required the installation of water pumping infrastructure to accommodate the characteristics of a sloped terrain (see notes in Table 8). Thus the scope of works was greater than just connections, and a higher cost per person would be expected. In addition, connecting longer distances tends to leverage greater economies of scale, and the average length of connection in these villages was smaller than the connections in the benchmark. While it is more difficult to state that these investments were cost-effective, they did benefit over 15,000 residents.

100

Table 10. Coastal Village Conservation and Development Program (CVCDP): Water Supply and Sanitation Improvements Capital

cost No. of beneficiary

HHs No. of beneficiary

residents Cost per capita

HIMARA MUNICIPALITY

Reconstruction of sewerage and water supply system, Municipality Himara

513,776 800 4000 128.441

Improvement of water supply system, village Vuno 192,385 167 500 384.772

New water supply system, village Gjilek 423,532 400 1200 352.942

Upgrade of water supply system (Ilias) 124,629 61 310 402.033

Upgrade of water supply system (Palasa) 207,045 210 1050 197.19

Construction of new water supply system (Qeparo) 329,580 316 1600 205.99

LUKOVA COMMUNE

Upgrade water supply system, Piqeras 376,291 380 1400 268.784

Upgrade water supply system, Shen Vasil 273,809 355 1300 210.624

Upgrade of the water supply system (Lukova) 299,710 330 1650 181.64

VERGO COMMUNE

Upgrade of the water supply system (Bajkaj and Palavli) 327,208 450 2250 145.43

Total 3,067,965 3,469 15,260 201.05

Notes: 1 – Included the costs of connections and water meters; 2 – Included water exploration and drilling costs for new sources; 3 – Higher cost due to remoteness and connection of fewer households; 4 – Includes the cost of capturing of water source/natural springs.

101

Component C: Porto Romano Hot Spot Clean-Up36 Cost: US$2,600,000 (Dutch grant), €1 million (Dutch grant) 26. Four hot-spots were identified as requiring emergency response clean-up activities as

they posed a significant risk to the health of the surrounding population and water supplies.

- Hot-spot 1 – Sulfur site - Hot-spot 2 – Lindane/dichromate chromium site (pesticide site) - Hot-spot 3 – Dumping site near the pumping station - Hot-spot 4 – Waste storage area, Bishti Palles 27. Hot-spots covered industrial sites, residential areas, and pastureland. Hot-spots with

extensive lindane/HCH and hexavalent chromium contamination covered a considerable surface, including a destroyed chemical plant (lindane and dichromate production), a nearby dumpsite, a new part of the chemical plant, and a sulfur dumpsite. There was also a chemical storage site at Bishti Palles, 2 km north of the chemical plant. After the chemical plant closed, approximately 5,000 people built houses in its surroundings, and five families used to live within the former factory premises (in hot-spot 2).

28. On May 2006, 450 to 700 tons of chemical waste stored in Bishti Palles (hot-spot 4)

were repackaged, removed, and incinerated in a specialized plant in Germany with €1 million in grant financing from the Government of the Netherlands.

29. In 2007, site investigations were carried out in three hot-spots with a total contaminated area of about 25 ha: hot-spot 1, 7.8 ha; hot-spot 2, 8.2 ha; and hot-spot 4, 0.76 ha. On the basis of these investigations, the EIA and the technical design for the remediation of the Porto Romano Hot-Spot were prepared.

30. Hot-spot 2 was selected as the site for constructing the confined disposal facility (CDF),

where contaminated soil and debris from the demolition of buildings in the three hot-spots would be safely encapsulated. Construction of the 24,000 m2 CDF (22,000 m3 excavation and 2,000 m3 filling) began in May 2010 and was completed by May 2011. Construction works were largely financed by a Dutch grant of US$2.6 million. Around 45,000 m3 of hazardous waste is landfilled and encapsulated in the CDF, of which about 40,000 m3 is contaminated soil and 5,000 m3 is from the demolition of buildings in the three hot-spots (Table 11).

36 Please note that these are actual expenditure on component while estimated capital cost as per Table (a) in Annex 1 is $4.21m

102

Table 11. Quantities of contaminated soil and debris from demolished buildings Contaminated areas Contaminated soil

(m3) Volume debris

(total, m3) Volume debris

(Contaminated, m3) 1 Total HS1 12,700 1,592 800 2 Total HS2 24,000 6,900 3,400 3 Total HS4 1,400 1,408 700 4 Areas in the vicinity of HS 1 & 2 1,000 - - TOTAL contaminated 40,100 9,900 5,000

Benefits 31. The benefits from the Porto Romano clean-up efforts largely arise from the reduced

risk to human health from exposure to hazardous waste, either through direct exposure or through various pathways such as contaminated drinking water supplies. Spatial factors are a significant factor in the level of exposure, which in turn dictates the level of health impact. For instance, the chemical plant was located in an area where 5,000 people built houses and children played in the old structures (direct contact) or animals grazed (indirect). In coastal locations, wastes would leach into groundwater or run off into coastal waters. The precise pathways are difficult to determine; however, independent testing of soils and food37 indicated HCB, lindane, and Beta HCH at levels well above international standards and even above other known contaminated sites around the world.38

32. There is a growing literature on exposure and impacts. For example, chromium and

lindane contamination concentrations in ground and surface waters that exceed the WHO limit for drinking water have been shown to result in statistically significant increases in mortality and specific cancers.39 Thus the removal and encapsulation of these hazardous wastes has reduced risks, despite the absence of a precise indicator.

37 In this case - eggs from chickens raised in the area. 38 Merita Mansaku-Meksi and Besnik Baraj, 2006. Pesticide contamination in the abandoned chemical plant, Porto Romano, EDEN Center (Environmental Center for Development, Education and Networking), International POPs Elimination Project (IPEP). 39 Minichilli, F. et al., 2009. Epidemiological Study in an Area Contaminated by Chromium, Arsenic, Mercury and Boron in Tuscany Region (Italy). Epidemiology 20 (6): S185-S186. See also Fantini F. et al., 2012. Epidemiologic studies on the health status of the population living in the Sacco River. Epidemiol Prev. 36 (5 Suppl 4): 44-52.

103

Annex 6. Bank Lending and Implementation Support/ Supervision Processes (a) Task team members

Names Title Unit Responsibility/ specialty

Lending Rita Cesti Sr. Water Resources Specialist ECSSD TTL Supervision/ICR Elmas Arisoy Practice Manager GGODR Procurement Rita Cesti Lead Water Resources Specialist GWADR TTL until 2009 Drita Dade Sr Natural Resources Mgmt.

Specialist GENDR Sr. Operations

Officer Paul T. Dean Consultant ECSSD -

HIS

Marina Djabbarzade HQ Consultant ST GSURR Cultural Heritage Blaga Djourdjin Procurement Specialist GGODR Procurement David E. Dowall HQ Consultant ST LCSDU -

HIS

Ruxandra Maria Floroiu Senior Environmental Engineer GENDR Environmental Engineer

Maninder S. Gill Director GSURR Elona Gjika Financial Management Specialist ECADE Adriana Damianova Lead Environmental Specialist GENDR TTL since 2009 Ana Gjokuta Senior Communications Officer ECCAL Communications Artan Guxho Senior Infrastructure Specialist GTIDR Urban

Infrastructure Anthony John Lamb HQ Consultant ST GSURR Urban

Development Craig Meisner Sr. Environmental Economist GENDR ICR Economic

Analysis/ Author Jorge Villegas Sr Social Development Specialist GSURR Safeguards Jonathan Mills Lindsay Lead Counsel LEGEN Counsel Frederick Brusberg Lead Social Development Sp. GSURR Consultant Paula F. Lytle Senior Social Development Spec GSURR Safeguards Belita Manka Counsel LEGOP Safeguards Luisa Moises Matsinhe Senior Executive Assistant AFCS2 Leonardo Mazzei E T Consultant SEGEN -

HIS

Natasa Vetma Sr Environmental Specialist GENDR Safeguards Ida N. Muhoho Consultant GGODR FM Norval Stanley Peabody Consultant GEEDR Social

Development Radhika Srinivasan Sr Social Scientist GCFDR Safeguards June Taboroff Consultant SDV -

HIS Cultural Heritage

Frank Van Woerden Senior Environmental Engineer GENDR Environmental Engineer

Katelijn Van den Berg Senior Environmental Economist GENDR TTL Kozeta Diamanti Program Assistant ECCAL Michael John Webster Sr Water & Sanitation Spec. GWADR Carl-Fredrik von Essen Jr Professional Officer ECSSD -

HIS

104

(b) Staff Time and Cost

Stage of project cycle Staff time and cost (Bank Budget only) No. of staff weeks USD thousands (including

travel and consultant costs) Lending

FY04 8.91 41.55 FY05 70.93 403.18 FY06 0.00 -0.03 FY07 0.00 0.00 FY08 0.00 0.00

Total: 444.70

Supervision/ICR FY04 0.00 0.00 FY05 0.00 0.00 FY06 37.46 111.65 FY07 38.69 139.16 FY08 35.14 156.20 FY09 56.64 262.66 FY10 41.79 324.11 FY11 48.32 311.13 FY12 31.29 231.71 FY13 29.00 230.42 FY14 26.39 185.29 FY15 24.87 162.78 FY16 11.01 63.11

Total: 380.60 21,773.06

105

Annex 7. Beneficiary Survey Results40 Introduction and Scope of Beneficiary Survey 1. A beneficiary survey was undertaken by the project implementing agency through the

Urban Research Institute to assess the impact of project investments from the perspective of beneficiaries, including citizens and institutions. The main findings of this assessment are based on data generated from a combination of instruments: the beneficiary survey, focus group meetings, and in-depth interviews conducted with direct beneficiaries of ICZMCP, including residents and local and central government officials of the south coast and Porto Romano.

2. The beneficiary survey was carried out from December 2014 to January 2015, and

some opinions may not reflect actions completed after the interviews. Additional clarification is provided where necessary to reflect the current status of project actions.

3. Beneficiary survey is based on a sample of about 595 interviewers or about 87%

constitute direct interviews with direct beneficiaries including Local Government representatives at municipality and commune level. The remainder of the interviews, which is about 25 or 4%, consists of representatives of local government and line institutions that are physically deployed in the Project area. About 50 interviews or approximately 8%, include staff and administration of the project, representatives of the Central Government institutions, NGOs engaged in this project, as well as representatives of donors who funded the project.41 About 50 interviews (8%) were with staff and administration of the project and representatives of central Government institutions, NGOs engaged in the project, and donors that funded the project. The remainder of the interviews—20 (4%)—were with representatives of local government and line institutions that are physically deployed in the project area. The beneficiary survey was conducted using an integrated questionnaire with questions related to beneficiaries’ level of satisfaction with several aspects of project components; social and economic impact; environmental impact; procedures for selecting priority subprojects; level of information and knowledge about ICZMCP and procedures at the local level; role and presence of PCU/World Bank project management; participation of beneficiaries and their contribution; and maintenance and sustainability of subprojects.

40 The Annex occasionally uses verbatim descriptions results from the Beneficiary Survey Report conducted by URI and submitted to the Bank by the Ministry of Urban Development. 41 Municipalities and communes included in the survey: Municipality of Saranda; Municipality of Orikum; Municipality of Himara, including Himara town, Vuno, Dhermi, Gjilek, Qeparo, Ilias, Palase; Lukove Commune, including Lukove, Borsh, Piqeras, Shen Vasil, Nivice; Vergo Commune, including Bajkaj and Palavli; Xarra Commune; Ksamili Commune; Pllake Qenurio village in Aliko Commune; Delivina Municipality; and Porto Romano.

106

Key Results 4. The majority (about 71.5%) of the interviewed residents in the project area showed

awareness of the ICZMCP, 25% did not know about the project, and the remainder did not respond.

a) Survey Results on Component A (Subcomponent A.2.e): Protected Area

Management Strengthening (Butrint National Park) 5. The Butrint Management Plan is completed. Responsible staff at the Ministry of

Culture made a presentation to the evaluation team on their plan to prepare a new integrated plan containing four elements: archeology, monuments, environment, and tourism. Work on the plan is supposed to start in 2015. The services offered to visitors have been improved, but civil works are needed for further service improvement. The introduction of human guides or audio guides, aiming towards interactive digital guides, is also important for improving the service. The park signs need enhancement, improvement, and other civil works to improve visitors’ safety on trails. Tree planting on both sides of the Butrint-Vrine-Shendelli road is completed. During the last few years, records show an increase in the number of visitors to Butrint Park: in 2014 102,093 tourists visited the park, 10 percent more than in 2013.

b) Component B: Southern Coastal Environmental Infrastructure and

Rehabilitation 6. This component financed improvement of critical public environmental infrastructure

and municipal services, community infrastructure improvements, and revitalization and enhancement of architectural and cultural services.

i) Survey Results on Subcomponent B.1-Southern Coastal Solid Waste

Management 7. This component financed construction of a modern, technically-engineered, regional

sanitary landfill (disposal facility for non-hazardous municipal waste) near Bajkaj – Palavli villages (in Vergo Commune) and an access road to the facility; and construction of a transfer station close to the Pilur-Kudhes road junction in the Municipality of Himara. Civil works for the construction of the landfill and the transfer station are completed. The key beneficiaries of this subcomponent are the population of the Municipalities of Saranda, Himara, and Delvina and the Communes of Ksamil, Xarre, and Aliko, including the summer residents of their tourist areas. The resident population that is likely to benefit from the landfill in Bajkaj is estimated at about 100,000 inhabitants during the summer season.

107

Overall opinion on the impact of landfill in Bajkaj and transfer station in Pilur (Himara) for tourism development. 8. Most of the interviewed population (about 54.2%) responded that the construction of

the landfill in Bajkaj and the transfer station in Himara will positively affect the development of tourism in the project area.

Overall opinion of interviewed population about the location of landfill in Bajkaj and the transfer station in Pilur (Himara). 9. Beneficiaries’ general perception of the overall objective of the subcomponent is

satisfactory: about 63.5 percent of those interviewed think that the location selected for the landfill is appropriate. Respondents generally perceive that disposal of waste in a sanitary landfill, directly or through the transfer station, would improve the environmental situation as it would stop the dumping of solid waste in open sites and would limit burning of waste close to urban and tourist areas. The survey also found a high level of dissatisfaction among the inhabitants of Bajkaj village where the landfill is located: more than 85 percent of those interviewed believe that the location is not

54.2%

21.3% 22.5%

2.0%

0%

10%

20%

30%

40%

50%

60%

Yes No Don't Know No answer

Impact of Bajkaj landfill and transfer station on tourism development

63.5%

14.0% 10.9%5.6%

0%

10%

20%

30%

40%

50%

60%

70%

Appropriate Inappropriate Not interested Another site

Opinion of interviewed inhabitants on the selection of the landfill site

108

appropriate and that the landfill will damage the environment where it is situated. Notwithstanding the project efforts to educate local people about the safe operation of sanitary landfills and measures to fully mitigate effects such as odor and insects, views like this are not unusual; they are consistent with the “not-in-my-back-yard” attitude of many populations living near landfill facilities.

10. The mayors of Saranda and Himara have stated that the solid waste component is

considered an important investment in southern Albania; however, the management and functioning of the landfill remain a challenge. They also say that, if the facilities are given over to the beneficiaries to operate, the landfill will significantly reduce environmental impacts. The interviewed mayors consider as “high” both the operating costs and the “gate fee” or “entrance price” for each ton of waste deposited at the landfill or the transfer station. The mayors of Saranda and Himara expressed unwillingness to charge a “gate fee” to citizens as part of the local tariff for waste management and cleaning service, and the expectation is that the municipalities will not use the landfill if the cost remains at the proposed level. The survey was carried out before all mayors in the landfill service area, including the mayors of Saranda and Himara, agreed on the tipping fee of US$14.5/ton and signed the landfill service agreement with the Vlora Landfill Company, legally established in February 2015 to operate the landfill. Furthermore, when asked whether they would pay more for a better waste management service, most of the interviewed population (54.2%) said yes.

Willingness of population to pay higher waste management service fee in exchange for better service. ii) Survey Results on Subcomponent B.2-Saranda Gateway 11. The project financed the reconstruction of Saranda passenger port facilities to

improve access by cruise liners and facilitate tourism development on the southern coast. The general perception of the beneficiaries of the overall benefit of

54.2%

26.3%

15.5%

4.0%

0%

10%

20%

30%

40%

50%

60%

Yes No Don't know No answer

Willingness of inhabitants to pay a higher service fee for waste management

109

Subcomponent B2 (including water supply, wastewater treatment, and port infrastructure) is satisfactory. About 34 percent of the interviewed beneficiaries are satisfied to very satisfied with the project; 28 percent are moderately satisfied with the results, because they perceive no improvements in water supply or wastewater treatment; and 26 percent express dissatisfaction regarding the project because they deem the overall city infrastructure and utilities management, not the investments in port infrastructure, to be unsatisfactory.

Level of satisfaction with rehabilitation of Port of Saranda. 12. The port facilities (berth and embarkation/landing area) were very much improved,

and the volume of passenger traffic has increased in the last two years. At the time the survey was conducted the new berth was fully functional and the Port Authority had already signed a preliminary acceptance of works under the Defect Liability Period. The measured impact of Subcomponent B1 in the overall Project Development Objective related to the development of sustainable tourism is highly satisfactory. The passenger traffic increased by 21 percent during 2014 over the previous year—a growth trend that seems to have started in 2012-2013, even before the impact of the project was fully realized. According to the Port Authority, the number of cruise liner arrivals was 79 percent higher in 2013 than in 2012; however, this was followed by a 10 percent decrease in 2014. Both the mayor of the city and the Port Authority staff have stated that the investment is one of the most important interventions of that type in southern Albania ports; however, further improvements and investments are needed to allow the anchorage of cruise ships of larger size (such as Queen Elizabeth or the like)—for now, such ships anchor in the open sea, and passengers are transported to land in small boats. Overall the investment is considered as very sustainable, with low maintenance requirements.

4%

30%28%

26%

4%

8%

0%

5%

10%

15%

20%

25%

30%

35%

Very Satisfied Satisfied A little Satisfied Unsatisfied I don't know No opinion

How satisfied are you with the project's results?

110

Citizens’ opinion on the impact of project on the number of tourists. iii) Survey Results on Subcomponent B.3-Sewer and Water Supply in Saranda 13. The project financed investments to improve the water supply system and rehabilitate

the sewerage network in Saranda, with works to replace the Navarica transmission main, extend the distribution network in tourist areas, and install a pressure line from the wastewater treatment plant (WWTP) to Çuka Channel and sewer lines in Saranda Town. The primary beneficiaries of the subcomponent are the populations of the Municipality of Saranda and of Ksamil.

14. Municipal authorities and the director of the water utility in Saranda express

satisfaction with the results from the Navarica pipeline and the pressure line. They are of the opinion that the overall improvement will require additional investments to increase the capacity of the water reservoir in Saranda. While the water supply service has improved for businesses and inhabitants in the tourist area, they perceive that the impact of the wastewater system will be fully realized after 100 percent of households have been connected.

15. The general perception of the community on the overall objective of Subcomponent

B3 is moderately satisfactory. About 34 percent of those interviewed are satisfied or very satisfied with the project, mainly because of the moderate impact on the water supply hours for the majority of the inhabitants of the city, which have increased significantly but remain below 24 hours. The delay in operation of the WWTP will lead to delay in improving the quality of the seawater in the tourist area.

40.00%44.00%

16.00%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

50.00%

Yes No Don't know

In your opinion, has the project helped increase the general number of tourists?

111

Main benefits from the water subproject (Navarica pipeline) 16. When asked about main benefits received from the subproject, about 28 percent of

respondents report that water supply has improved, 22 percent that they are connected with the supply pipeline, 16 percent that water quality has improved, and 16 percent that sanitary conditions have improved. Among those that report improvement in water supply hours, 86 percent say they receive water less than 12 hours/day, 7 percent that they receive it more than 12 hours/day, and 7 c that they have uninterrupted supply for 24 hours/day.

17. At the time this survey was conducted, the new water supply line from Navarica

reservoir was fully functional and the works had been accepted by Saranda Water Company. The works performed were generally reported to be of good quality by community representatives, local government, and water supply experts. According to the director of the water utility in Saranda, the new pipe has eliminated losses in the water supply system, thus increasing the supply from Navarica source by 25 percent (from 12,000 m3 to 15,000 m3 per hour). The director of the water utility also states that a number of apartment buildings and hotels in the tourist area have been connected to the water supply system as a result of the new water pipeline, resulting in an increase of water quantity in the city reservoirs as well. The supply from the public network has significantly reduced the cost of water supply for the inhabitants of the tourist area, who were previously supplied through private water tank vehicles. The director also noted that no notable problems have been encountered during the implementation of the works. The project impact in the overall water supply and situation investments in Saranda is moderate, as it is related to the completion of other donor programs that are under way. The construction of a wastewater outlet from the WWTP to Çuka Channel was implemented successfully, although it was widely associated with the investment for the construction of the WWTP.

22%

16%

14%

4%

28%

46%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Connection of property to the water supply…

Improvement of sanitary conditions

Improvement of water quality

Business improvements

Water supply timing

No opinion

What benefits has this project produced for the community?

112

iv) Survey results on Subcomponent B.4-Coastal Village Conservation and Development Program (CVCDP)

18. This component financed public utility infrastructure and tourism infrastructure in

traditional and nontraditional villages, such as improvements to sewerage and wastewater treatment, potable water supply, access roads from the main road, and cultural heritage protection and enhancement. Investments included landscaping, interpretation and signage, protectionmeasures, lighting, and improved access (internal paths, stairs, and streets) to cultural heritage sites (e.g., monasteries, forts, castles); and enhancement of traditional villages (Roof and Façade and Bed and Breakfast pilot projects).

19. The primary beneficiaries of the subcomponent were the populations of the

Municipality of Orikum; the villages and towns of the Municipality of Himara, including Himara, Vuno, Dhermi, Gjilek, Qeparo, Ilias, Palase; the villages of Lukove Commune, including Lukove, Borsh, Piqeras, Shen Vasil, Nivice; the villages of Vergo Commune, including Bajkaj and Palavli; Xarra Commune; Ksamili Commune; and Pllake Qenurio village in Aliko Commune.

20. The results indicate that the majority of interviewed residents (71.5%) are generally

aware or have knowledge of the ICZMCP. They have also heard that their village/town had a subproject funded under this project. Beneficiary survey data indicate that beneficiaries’ level of participation in the subproject identification process was moderate: only 21.8 % of the interviewed inhabitants report that they were part of the subproject identification process.

Level of beneficiaries’ participation in the identification of subprojects. 21. The general perception of the community beneficiaries on the overall objective of

Subcomponent B4 is satisfactory—about 77.5 percent of those interviewed were at least somewhat satisfied.

21.8%

75.4%

2.6% 0.3%0%

10%

20%

30%

40%

50%

60%

70%

80%

Yes No I don't know No opinion

Level of participation in the selection phase of the project

113

Overall level of satisfaction with project results. 22. Local government representatives of the Municipality of Himara and of other

communes, as well as village heads, express satisfaction, confirming that the investments changed the image of the village or town and were among the priority investments needed. Businesses and inhabitants report improved access to water service, and improvements in sanitary conditions and water quality. However, the heads of the villages say that despite the improvement in road infrastructure, vital infrastructure—waste management, electrical power, water supply, waste dump sites, lack of air and poor sea transport, health and social services, and access to public services—is still extremely poor.

Overall opinion on main benefits from water supply systems. 23. Most residents feel that the CVCDP infrastructure facilities are functional and serve

the residents of the village. A higher percentage believes that the infrastructure built by the project has been successful in providing the service it was built for, particularly for services that are key for tourism growth. Many cite improved access to roads and improved road circulation.

12.6%

42.7%

22.2%

11.0%

3.6%

7.9%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Very satisfied Satisfied Slightly satisfied Dissatisfied I don't know No opinion

General level of satisfaction with the project

32.1%

18.2%

12.8%

3.3%

28.5%

0%

5%

10%

15%

20%

25%

30%

35%

Connection ofproperty to thewater supply

network

Improvement ofsanitary conditions

Improvement ofwater quality

Businessimprovements

Water supplytiming

Water supply system: benefits of the project

114

Main results from the road infrastructure improvements. 24. When asked about the impact of sewer subprojects, many inhabitants appreciate

increased access to sewer systems and improved sanitary conditions at home, whereas about 60.4% of the habitants specify that the main impact is of an environmental nature, reducing pollution of the environment, water resources, and seawater.

Main results from the sewer infrastructure improvements. 25. The project impact is considered to be positive, as 47 percent of those interviewed

believe that the community investments made as part of Subcomponent B.4 have had a positive impact on the growth of tourism in the area.

38.1%

44.0%

6.6% 6.8%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Improvement of roadaccess

Improvement of roadcirculation

Development of yourbusiness

Other

Roads and village squares: benefits of the project

10.3%

19.1%16.2%

22.1% 22.1%

10.3%

0%

5%

10%

15%

20%

25%

Increasedaccess in the

seweragesystem

Improvementof sanitary

housingconditions

Reducedpollution of the

environment

Reducedpollution of

water sources

Reducedpollution of sea

water

Developmentof yourbusiness

Sewerage: benefits of the project

115

Impact of the project on coastal tourism development. c) Component C: Porto Romano Hot-Spot Clean-Up 26. This component financed works to demolish old factory buildings and foundations,

excavate contaminated soil, and construct a confined disposal facility and dispose of contaminated soils, concrete, and other wastes in it. The key beneficiaries of the project are the population of Porto Romano, including the former residents of the remaining plant buildings and the residents of the whole Porto Romano neighborhood, part of Durres Municipality, estimated at more than 15,000 inhabitants.

27. The general perception of the beneficiaries on the overall objective of Component C

is satisfactory. About 74 percent of those interviewed are satisfied with the outcome of the project, and 93 percent of those interviewed who were aware of the investment confirmed that it had a positive impact on the environmental situation in the area.

Impact of the quality of the clean-up of Porto Romano site.

47.0%

34.8%

16.4%

1.8%

0%

10%

20%

30%

40%

50%

Yes No I don't know No opinion

Positive impact of the project on the number of tourists

0%

10%

20%

30%

40%

50%

60%

70%

Very good Good Not good Poor quality I'm notinterested

I don't know No opinion

What is your opinion on the quality of clean-up works of Porto Romano?

116

28. Local and central government representatives consider the project to be the most

serious large-scale intervention carried out so far in this highly polluted area of the former chemical plant in Porto Romano. All stakeholders confirm that the area is unrecognizable, and major transformation has occurred in the four most polluted spots of the area. There is general agreement among beneficiaries that the project has significantly reduced human and environmental health hazards to the population.

Opinion of Porto Romano habitants on the clean-up of hazardous waste. 29. More than 73.5 % of habitants interviewed in Porto Romano are aware that the place

is either totally or partially cleaned of hazardous waste.

Level of satisfaction with Porto Romano project. 30. Most of interviewed or about 74% of habitants in Porto Romano are very satisfied or

satisfied with the results of the project, 20 % of them are somehow satisfied, whereas 6 % of them do not have an opinion on the question.

23.50%

52.00%

23.50%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

Yes Partially No

Do you think that the area is cleaned of hazardous waste?

11%

61%

20%8%0%

10%

20%

30%

40%

50%

60%

70%

Very satisfied Satisfied Somehow satisfied No opinion

Are you satisfied with the rehabil itation and cleaning results in the area?

117

Level of satisfaction with Porto Romano project: 31. From those that are satisfied with project results, about 74% of the respondents

indicates that decrease of the polluted soil is the highest benefit out of the project implementation, 68.5% and 62.8% of them believe that in addition of soil pollution, air and water pollution are respectively decreased, whereas 60% of them indicate that health risks for Beneficiary Survey and Assessment of Project Results Impact Beneficiary Survey Report.

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

Lowering soil level of pollution

Lowering level of air pollution

Lowering pollution of water resources

Reduction of health risks for residents

Increased awareness of residents

Re-accommodation of families living in…

The decrease in toxic materialts exposure to residents

Growing awareness of residents in the area

If you are more or less satisfied, can you specify which are the most important improvements after completion of the

project?

118

Annex 8. Stakeholder Workshop Report and Results 1. This summary of the final Stakeholder Workshop is based on the notes prepared by the

PCU. The workshop on March 5, 2015, was organized by the Ministry of Urban Development (MoUD), as the project implementing agency. The purpose of the workshop was to bring the voices of the many project beneficiaries and share results and lessons from the implementation of the project over nine years.

2. The workshop was very well attended by multiple stakeholders, including

representatives of the staff of the Prime Minister, relevant Ministries, members of the Project Steering Committee, heads of local governments and communities, representatives of the donor community, and representatives of different beneficiary groups. The World Bank team from Washington and Tirana, project staff, and staff of the MoUD were present and participated in the discussion. The inaugural session of the workshop was attended by Mrs. Ellen Goldstein, the World Bank’s Country Director for Albania.

3. The workshop was opened by Mr. Gjon Radovani, Deputy Minister, MoUD,

ICZMCP’s Project Authorizing Official, who welcomed the participants and moderated the first session. Sustainable tourism development was the main subject of the workshop. Mrs. Eglantina Gjermeni, Minister, MoUD, thanked all players and project partners, who contributed to achieving the project’s objectives. She summarized the projects financed under the ICZMCP, their results, and their impacts on direct beneficiaries and on sustainable tourism development.

4. Mrs. Tahseen Sayed, Albania Country Manager, underlined the collective effort of so

many people supporting project implementation. She highlighted, in particular, the strong commitment of the GoA to address and resolve the challenges the project encountered. Mrs. Sayed also underlined that ICZMCP has established the structure for future coastal regeneration and sustainable tourism development, which can be a leading growth-generating sector for Albania’s economy.

5. The representatives of the PCU presented details related to the implementation of the

project components and activities and project results and benefits, and discussed the key points of the draft Borrower ICR (Implementation Completion Report), as well as lessons learned from implementation that will be useful in future similar projects. The expert group hired by the project discussed the methodology and the results of the beneficiary survey, including quantitative and qualitative data collection methods, results of focus group meetings, and results of in-depth interviews with direct beneficiaries of ICZMCP, residents, and local and central Government officials.

6. The participants took a lot of interest in project results and sought clarifications on a

number of points. The Q&A session, conducted in the Albanian language, was moderated by Mrs. Drita Dade (Senior Natural Resource Management Specialist at the World Bank’s Tirana office). The questions focused primarily on the benefits of the

119

project, the project’s impacts on sustainable tourism development, and the vision of representatives of coastal local governments for tourism development.

7. Following the discussions, Mrs. Adriana Damianova (Task Team Leader for the

project) focused on the vision and scaling up the efforts for sustainable development of the Albanian Coastal Zone. She highlighted the linkage between infrastructure needs for sustainable tourism development and the need for coastal zone regulation.

8. The key areas of the presentation and discussion included the following:

Tourism vision. GoA wants to turn Albania into an attractive destination, where tourists will come from many more countries and will add value to the local economy, which is important for all people living there. The bigger challenge is to use Integrated Coastal Zone Management, which involves multiple institutional players. It was noted that tourism is an excellent source of growth for the Albanian economy, as Albania has an unspoiled environment, supported by beautiful landscape, natural resources, cultural heritage, and traditional villages. Comparing to other countries in the region, Ms. Damianova pointed out that Albania has potential as a great tourist destination if sustainable coastal zone management is practiced. There are very few places in the world that can offer comparable pristine natural assets for tourism. Albania could benefit significantly if coastal zone policies and regulations support tourism by focusing on the unique natural features, tourism circuits, and products.

Challenges ahead. The workshop discussed that Albania is at a crossroads and must make strategic decisions to maintain what it can offer to the rest of the world. The need is to focus on the right kind of infrastructure, because of impacts on ecosystems, land, and tourism prospects. Infrastructure needs capital resources, which is a challenge. Albania needs to decide on the type of coastal development and tourism they would like to promote. The discussion highlighted the need to recognize the uniqueness of Albania’s natural and cultural values and associated risks in absence of appropriate regulations, institutional models, and financial resources for sustainable tourism.

a) The representatives from the Ministry appreciated the support the Bank provided under the ICZMCP, especially on infrastructure investments. It was noted that the Bank project promoted the concept of an integrated approach to tourism promotion by focusing on environmental improvements and increasing tourist numbers, and consequently increasing income.

b) The PCU summarized key lessons—the need to (a) improve enforcement of regulations and institutional processes; (b) give priority to nature- and culture-based tourism in Albania; and (c) significantly expand investments in environmental infrastructure that would reduce the coastal pollution and degradation.

120

Annex 9. Summary of Borrower's ICR and/or Comments on Draft ICR The implementing agencies were provided a copy of the draft ICR and indicated that they had no comments.

121

Annex 10. Comments of Cofinanciers and Other Partners/Stakeholders The co-financiers and other partners were provided a copy of the draft ICR and indicated that they had no comments.

122

Annex 11. Selected Supporting Documents Committee for Environmental Protection, Government of Albania, Mediterranean Environmental Technical Assistance Program (METAP), Commission of European Union, EIB, World Bank, UNDP, Dobbin Millius International Vienna, Virginia USA, Albania Coastal Zone Management Plan Final Report, July 1995. Republic of Albania, Ministry of Environment, Institutional Strengthening and Environmental Remediation Project, GKW Consult, Mix Tecnic, Draft Final Report, April 2004. Republic of Albania, Integrated Coastal Management and Clean-Up Program, Heritage Assets Mapping Final Report, SIMSpa GICO Branch and IMed Consulting Consortium, March 2005.

Report No: 32240-AL Project Appraisal Document, Integrated Coastal Zone Management and Clean-Up Project May 25, 2005. http://wbdocs.worldbank.org/wbdocs/viewer/docViewer/index1.jsp?objectId=090224b0806c6f59&standalone=true&respositoryId=WBDocs Ministry of Public Works, Transport and Telecommunications, Integrated Coastal Development Plan of the Southern Albanian Coastal Region Draft Report, PAP/RAC-SOGREAH Consortium, August 2006. Ministry of Public Works, Transport and Telecommunication, Albania Southern Coastal Development Plan, Final Report TBU-HBA-P&P JV Consultants September 2007. Ministry of Public Works, Transport and Telecommunication, Albania, COWI Consult, Southern Coastal Development Plan - Strategic Environmental Assessment, Final Report, December 2007. Report No.41189-AL, The Inspection Panel Report and Recommendation, Albania Integrated Coastal Zone Management and Clean-up Project (IDA Credit No.4083-ALB), October 17, 2007. Report No INSP/R2008-0004/2 IBRD Management Report and Recommendation in Response to the Inspection Panel Investigation Report, Albania Integrated Coastal Zone Management and Clean-Up Project, February18, 2009. Ministry of Public Works, Transport and Telecommunications Integrated Coastal Zone Management and Clean-up Project, Project Operations Manual, March 25, 2010. Ministry of Public Works, Transport and Telecommunications Integrated Coastal Zone Management and Clean-up Project, Environmental and Social Safeguards Framework (updated for Project Restructuring), February 23, 2010.

123

The Albanian Society for the Protection of Birds and Mammals, Butrint Park Management Plan, Final Revised Report, Tirana, September 2010. The Albanian Society for the Protection of Birds and Mammals, Butrint Park Management Plan, Social and Legal Assessment Study, Final Revised Report, Tirana, September 2010. Albania Coastal Zone Management and Cleanup Project, Social and Vulnerability Assessment for the South Coast, Final Report, Arca Consulting, Italy with Comport, Albania and Terra Ltd., Italy, January 2011. Ministry of Environment, Forestry and Water Administration of Albania, Integrated Coastal Zone Management and Clean-up Project, Aftercare Management Plan for Porto Romano Hot Spot, COWI Consult, July 2011. Ministry of Environment, Forestry and Water Administration of Albania, Integrated Coastal Zone Management and Cleanup Project Public Awareness Program for Porto Romano Hot Spot Cleanup, Final report, Shëndet 2000 Consulting, September 2012. Republic of Albania, Ministry of Urban Development Integrated Coastal Zone Management and Clean-Up Project, Beneficiary Survey and Assessment of Project Results Impact, Final Report, Urban Research Institute, March 2015. All other project documents may be accessed at http://www.worldbank.org/projects/P086807/integrated-coastal-zone-management-clean-up-project-apl-1?lang=en

124

MAP NO. IBRD 33577R

125

MAP NO. IBRD 33742