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Document of The World Bank
Report No: 32279
IMPLEMENTATION COMPLETION REPORT(TF-25535 IDA-33750)
ON A
CREDIT
IN THE AMOUNT OF SDR 29.9 MILLION (US$40.0 MILLION EQUIVALENT)
TO THE
REPUBLIC OF ARMENIA
FOR A
TRANSPORT PROJECT
June 28, 2005
Infrastructure and Energy DepartmentEurope and Central Asia Region
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CURRENCY EQUIVALENTS
(Exchange Rate Effective January 2005)
Currency Unit = Dram 1 Dram = US$ 531.1
US$ 1 = 0.0019 Drams
FISCAL YEARJanuary 1 December 31
ABBREVIATIONS AND ACRONYMS
AR Armenia Roads SSCC (formerly Armenia Road Directorate)ARD Armenia Railway DepartmentCAS Country Assistance StrategyEIRR Economic Internal Rate of ReturnEU European UnionGoA Government of ArmeniaICR Implementation Completion ReportIDA International Development AssociationMAAP-5 Microcomputer Accident Analysis Package (A TRL software, version 5) MoF Ministry of Finance and EconomyMoTC Ministry of Transport and CommunicationsNPV Net Present ValuePAD Project Appraisal DocumentPIU Project Implementation UnitPMR Project Management ReportsPPIAF Public Private Investment Advisory FacilitySOE Statement of ExpendituresSPA State Procurement AgencyTA Technical AssistanceTRACECA Transport Corridor Europe Caucasus AsiaUSAID United States Agency for International DevelopmentVOC Vehicle Operating Cost
Vice President: Shigeo Katsu, ECAVPCountry Director Donna M. Dowsett-Coirolo, ECCU3Sector Manager Motoo Konishi, ECSIE
Task Manager Olivier Le Ber, ECSIE
ARMENIATransport Project
CONTENTS
Page No.1. Project Data 12. Principal Performance Ratings 13. Assessment of Development Objective and Design, and of Quality at Entry 24. Achievement of Objective and Outputs 55. Major Factors Affecting Implementation and Outcome 86. Sustainability 107. Bank and Borrower Performance 108. Lessons Learned 129. Partner Comments 1310. Additional Information 15Annex 1. Key Performance Indicators/Log Frame Matrix 16Annex 2. Project Costs and Financing 17Annex 3. Economic Costs and Benefits 19Annex 4. Bank Inputs 20Annex 5. Ratings for Achievement of Objectives/Outputs of Components 21Annex 6. Ratings of Bank and Borrower Performance 22Annex 7. List of Supporting Documents 23
Map IBRD No. 30837R
Project ID: P044829 Project Name: Transport ProjectTeam Leader: Olivier Le Ber TL Unit: ECSIEICR Type: Core ICR Report Date: June 28, 2005
1. Project DataName: Transport Project L/C/TF Number: TF-25535; IDA-33750
Country/Department: ARMENIA Region: Europe and Central Asia Region
Sector/subsector: Roads and highways (64%); Railways (30%); Central government administration (6%)
Theme: Infrastructure services for private sector development (P); Access to urban services for the poor (S); Rural services and infrastructure (S)
KEY DATES Original Revised/ActualPCD: 11/04/1998 Effective: 03/05/2001 03/05/2001
Appraisal: 09/28/1999 MTR: 06/30/2002 10/25/2002Approval: 06/08/2000 Closing: 12/31/2004 12/31/2004
Borrower/Implementing Agency: REPUBLIC OF ARMENIA/MINISTRY OF TRANSPORT & COMMUNICATIONS
Other Partners:
STAFF Current At AppraisalVice President: Shigeo Katsu Johannes F. LinnCountry Director: D-M Dowsett-Coirolo Judy O'ConnorSector Manager: Motoo Konishi Eva MolnarTeam Leader at ICR: Olivier Le Ber Anders H. G. BondeICR Primary Author: Mirtha Pokorny
2. Principal Performance Ratings
(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=Highly Unlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible)
Outcome: S
Sustainability: L
Institutional Development Impact: M
Bank Performance: S
Borrower Performance: S
QAG (if available) ICRQuality at Entry: S
Project at Risk at Any Time: No
3. Assessment of Development Objective and Design, and of Quality at Entry
3.1 Original Objective:The project had three objectives: (i) to improve the main road network, with commensurate reductions in total transport costs, to improve road safety, and to increase the operational efficiency of Armenia Roads SSCC (AR); (ii) to improve the rail service between Yerevan and the Georgian border, and the financial and managerial performance of the Armenia Railways Department (ARD); now the (corporatized) Armenia Railways; and (iii) to strengthen the planning capability of the Ministry of Transport and Communications, particularly in the use of economic analysis as a basis for setting priorities and making investment decisions in the transport sector, and in establishing a basis for improvement of urban transport services in Yerevan.
Project objectives and design were built upon the experience gained and the achievements accomplished under the Armenia Highway Project, which was being completed during the preparation of the Transport Project, and the issues identified through a Transport Sector Review carried out by IDA in 1997. The focus was to (i) consolidate the institutional progress made in transforming AR into an effective road agency, (ii) make inroads in reforming the national railways and setting the stage for its future role once conflicts with neighboring countries limiting railway traffic were resolved, and (iii) strengthen MoTC to carry out its planning functions on the basis of solid analytical work. Embedded in project design were also the objectives of securing appropriate and stable levels of funding for road maintenance, reducing its dependence on foreign financing for recurrent and capital expenditures, and ensuring the permanence of a cadre of highly competent professionals in AR once their salaries were not longer supported by IDA Credits.
Overall the objectives of preserving and improving the state of Armenia’s roads and of helping ARD to evolve into a commercial oriented enterprise were supportive of the Bank’s strategy to foster rapid development of the private sector to encourage economic growth and the alleviation of poverty. The CAS had identified unreliable and low quality infrastructure, especially in energy and transport, as a major barrier to the development of the private sector, exports and higher levels of economic activity. The government, faced with an extremely stringent budgetary situation, recognized that outside help was needed for both improving road and railway conditions. The strategy supported the development of surface transport in Armenia towards modern commercial practices.
Project design, particularly for the road sub-sector, benefited from the experience gained in the previous project and included a well thought balance between the most urgent physical infrastructure needs, raising the level of technical competency in the sector, reducing the number and severity of road accidents, and furthering the goal of securing the sustainability of the network through adequate funding. In the case of the railways component, while the physical elements had to be substantially revised because the difficulties of implementing them as originally planned proved insurmountable, the institutional components provided an adequate framework to support important reforms that resulted in a dramatic turnaround of the railway finances. These reforms, however, were mostly limited to pricing and operational policies aimed at short term financial improvements. In-depth structural reforms were not undertaken or were short-lived. That is the case of the unbundling of the railways into different companies, which was implemented during project preparation and subsequently reversed. In retrospect, the Government was not ready for the scope and pace of railway reforms supported under the project. The objective of strengthening the Ministry’s planning capabilities was also overly optimistic and probably lacked sufficient government ownership. As it turned out, the Ministry was in a state a flux during project execution, preoccupied and occupied in redefining responsibilities and organizational structures. The setting thus, was not conducive to the implementation of the type of technical assistance envisaged during project design although this situation could have not been foreseen during project design.
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The accomplishments of the project were mixed, not a surprising outcome considering that the policy changes sought were politically sensitive and usually confronted with strong opposition of powerful stakeholders. By the end of the project however, not only improvements of the physical road and railway infrastructures were contributing to reduce the cost of transport in Armenia, but progress had been made in (a) partially incorporating the “user pay” principle in road financing, (b) creating an adequate institutional setting for incorporating safety concerns in road management, (c) revising pricing and operational railway policies and turning around ARD’s financial performance, and (d) taking the initial steps to incorporate modern governance structures and principles to the sector.
3.2 Revised Objective:The objectives remained unchanged during the life of the project.
3.3 Original Components:The project, with an estimated total cost of US$47.0 million, was described in the PAD as having the following components:
A. Roads Component (US$30.9 million)
(a) Civil works and road rehabilitation (US$20 millio). Proposed treatment included 81 km of surface dressing, 246 km of overlays, and 23.7 km of reconstruction, a preliminary selection that would be updated yearly and could vary with changing circumstance.
(b) Civil works for Bridge rehabilitation (US$3.7 million). Included the transfer of technology with regard to bridge survey, bridge management, bridge rehabilitation, maintenance technologies and economic evaluations.
(c) Engineering design and supervision. (US$1.3 million). Financing foreign (30 staff/month) and local consultants (400 staff/month) for the design and preparation of bidding documents and the supervision of road and bridge civil works.
(d) Road Safety (US$5.0 million). Including technical services (US$0.5 million), equipment (US$0.2 million), and civil works (US$2.5 million) to carry out a Road Safety Program designed to include (i) the establishment of the National Road Safety Council with a permanent Secretariat, (ii) development of and Accident Data System; (iii) carrying out safety engineering activities including the establishment of accident standards, (iv) conducting safety audits; (v) establishing the capacity for making signs and for road marking, (vi) support for a vehicle inspection program, (vii) providing safety engineering training, (viii) providing traffic control equipment such as speed detectors, (ix) providing safety education within the school system, and (x) making the physical changes needed to eliminate some accidents black spots as these were identified through the accident reporting system.
(e) Institutional strengthening of AR. (US$0.9 million). Including technical services (US$0.3 million), administrative support for AR’s headquarters operations on a declining basis (US$0.4 million) and for the purchase of office equipment (US$0.2 million) to strengthen AR’s capacity to carry out maintenance by contract, introduce new technologies, and expand its capacity for planning.
B. Railway Component (US$15.2 million)
(a) Repair of Tracks and Bridges for the Yerevan-Georgian border line (US$5.5 million).(b) Energy supply infrastructure (US$0.9 million) including the replacement of 150 km of contact
wiring and repair of equipment substations (with works carried out by force account).
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(c) Telecommunications (US$0.9 million) including the installation of 42 km of cable, providing dispatch phones at stations, installation of central control panels, etc. Work by force account.
(d) Overhaul of Locomotives, Wagons and Passenger Coaches (US$5.8 million) to be carried out in ARD ‘s facilities with spare parts procured under the project.
(e) Improvement of Repair Facilities (US$1.2 million) to upgrade equipment at two ARD’s existing facilities.
(f) Technical Support and Training (US$0.6 million) comprising consultant services for railway restructuring including separation of infrastructure and operations, defining oversight role of the government, defining tariff policies and arranging relevant training; and
(g) Administrative Support (US$0.3 million) including basic office equipment to bring ARD’s operations to modern standards of accounting, tracking of goods and shipment, and communications locally and abroad.
C. Support for the Ministry of Transport and Communications (US$0.9 million)
The project was to provide office equipment (US$0.1 million), technical services and training (US$0.2 million) and administrative support for the central project PIU, including salaries and operation expenses (US$0.2 million) to enable the Ministry to become proficient in economic analysis as a basis for project evaluation and project coordination. It also included funds for an urban transport study for the city of Yerevan.
3.4 Revised Components:The main revisions in the project components were:
• On January 30, 2001 through an amendment approved by the Country Director, about US$1.5 million were reallocated from periodic to routine maintenance, the rationale being that after credit approval, funds from the Lincy Foundation were made available for periodic maintenance while routine maintenance, to be financed from the government’s budget, remained under-funded.
• At the same time, the “Energy Supply Infrastructure” component was dropped from the project and funds were reallocated to finance the installation of fiber optic donated by the EU. The railways advised IDA of their intentions of financing the original items in the component with their own resources.
• The two rather “formal” reallocations above were eventually followed by (i) substantial changes in the railways component, mainly to switch the emphasis from the improvement of rolling stock to the rehabilitation of the main track lines, and (ii) revisions in the technical assistance to the Ministry of Transport and Communications (MoTC) to adequate the consulting services to the changed perceived priorities of the Ministry. As a result, the assistance efforts shifted from transport planning to the development of the sector's legal framework.
The actual project cost was US$49.17 million, compared to the original estimate of US$47.00 million.
3.5 Quality at Entry:The ICR finds the quality at entry to be satisfactory. The objectives of the project were consistent with the objectives of the CAS and Government priorities. Project design, with its emphasis on the sustainability of the road network and railway operations was appropriate for a sector in need of a sound long-term financial structure. The preparation took into account IDA’s safeguard policies including the development of an appropriate environmental management plan. Project risks were appropriately assessed and addressed in the project design, and the Bank’s worldwide experience with similar projects was applied. In retrospect, the quality of project design could have been enhanced with (i) an ex-ante assessment of the adequacy of
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IDA’s procurement rules to carry out the improvements of the railways’ rolling stock; and (ii) with a better reading of MoTC’s and ARD's ownership of the railway reform and institutional development program. This may have not been an easy task considering that the Government was moving decisively during project preparation to implement the Bank's suggestions for reform. On the positive side, project definition allowed enough flexibility to adapt its content to the needs of the Borrower. The Government and IDA’s supervision team made commendable efforts to revise the project as necessary to keep it relevant and achieve its objectives. There was no Quality Assurance group assessment of this project.
4. Achievement of Objective and Outputs
4.1 Outcome/achievement of objective:The overall objectives of improving the road network and railway services to reduce the cost of surface transport and contribute to economic competitiveness and growth were fully achieved. Both the road and railway infrastructure experienced noticeable progress in terms of its serviceability and safety, and both AR and ARD increased their capabilities to carry out their respective functions.
The institutional strengthening of the road administration helped to cement the advances achieved during the Highway Project, particularly in the areas of design standards, contract design and enforcement, performance of the construction industry, environmental management and road safety. The latter involved the setting of a working Secretariat coordinating the areas of education, engineering and police enforcement, and substantial technical assistance and training for the collection of relevant accident statistics and the design of preventive and mitigating safety measures. Continuous high-level dialogue between the GoA and IDA on road financing, together with the development under the project of the analytical background to develop the criteria for the necessary level and sources of funds, resulted in a substantial increase of the budgetary allocations for road maintenance. In addition, 20% of fuel taxes are now being dedicated to the road agency. While the amount is below that necessary to satisfy the basic needs of the network, it represents recognition of the “user fee” character of the tax and a culmination of the continuous high-level dialogue between IDA and the Ministry of Finance to secure the sustainability of the network. It is expected that, as the macroeconomic situation of Armenia continues to improve, the percentage of user charges going to the network will increase.
With respect to the railways, the project provided the inputs for improving the line between Yerevan and the Georgian border: civil works for Rehabilitation of 55.67 km of the railway track between Yerevan and the Georgian border were completed by May 2005 and additional 16.6 km will be completed by the end of 2005. In addition, the project served as a useful vehicle for an intense exchange of ideas between the GoA, IDA staff and international experts which eventually translated into important policy decisions that are positively affecting ARD’s performance. Starting in 2001, the railways embarked in an in-depth revision of its tariff structure, eliminating cross subsidization between freight and passenger tariffs, accelerating its staff reduction program, discontinuing operations of some non-profitable lines and services and spinning-off and/or privatizing non-core activities. As a result, freight traffic increased by more than 30%, labor productivity increased from 90,000 TU per staff to 120,000 TU per staff and the railways got rid of its chronic operating deficits, starting to generate a surplus in 2001. This financial turn around, however, is ignoring the depreciation of the railways assets and therefore has a limited sustainability unless a long run railway strategy is agreed upon between the railways and the government. The project, with the financing of a Trust Fund, supported a detailed study of the issues being confronted by ARD and made highly pragmatic recommendations on the steps to be taken in the next five years to continue the operational and financial improvements of the railways. The study, carried out by Austrian consultants, served to support the shift in the emphasis of the project from investments in rolling stock to the upgrading of the most trafficked railway lines, recommended low cost actions to reduce the maintenance costs of both track and rolling stock, and helped in the preparation of a five-year business plan.
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The objective of strengthening MoTC’s capabilities for transport planning was not achieved. The objective probably did not count with the necessary support from the Ministry, and the funds were eventually diverted to other uses, such as the preparation of a new Transport Law. In fact, one of the project’s main institutional accomplishments is the help it provided for the modernization of the legal framework of the sector, even when the objective was not identified during project preparation. The project did achieve its objective of reviewing urban transport in Yerevan and making recommendations for addressing the main issues affecting the sector. In fact, the Urban Transport Study financed under the project developed a very useful traffic forecasting and modal split model and integrated it with financial analysis to evaluate different urban transport strategies for Yerevan. The study, however, may not have the expected impact unless the government actually trains people to use it and incorporates it as a tool for decision making. This has not yet happened.
4.2 Outputs by components:A. Roads Component (US$30.9 million)Highway Maintenance. About 227 km of roads were rehabilitated, overlaid and/ or reconstructed under the project at a cost of US$23.98 million under the Highway Maintenance component plus a cost of US$1.7 million under the Road Safety component, as compared to the appraisal estimate of works on 350.7 km at a cost of US$20 million. The 106% difference between the appraisal estimate of the average cost per km and the actual costs can be explained in part by the devaluation of the US dollar, but more importantly by the deterioration that took place between the preparation of the original studies and the commencement of the works. In addition, routine maintenance was performed on about 786 km of the network at a cost of US$1.68 million. As already mentioned, inclusion of routine maintenance under the project was agreed upon as a result of the project revision caused by the availability of funds from the Lincy Foundation. The component did achieve its objective of improving the network condition from an average roughness of 4.67 in 1988 to 3.1 in 2004. Project design was financed by a TRACECA Grant, and project supervision, accounting for 8% of the cost of the civil works, was provided by Finnish and local consultants. The works were completed on time and the quality was found by the supervision team to be good. The ICR finds this component to be satisfactory. Bridge Rehabilitation. The project financed the rehabilitation of 11 bridges at a total cost of US$1.8 million, compared to the appraisal estimate of US$3.7 million. Since the appraisal document does not include a detail of the type and quantity of works to be included in the project, it is not possible to make a valid comparison in terms of price or quantities. It is safe to say, however, that because of delays in starting this project component the amount of work performed was below original plans. Efforts were made during the project to join up international (Swedish) and local experts to ensure adequate transfer of technology in the areas of bridge survey and maintenance technologies. In fact a substantial amount of lead work, including the contracting of consultants to survey and design works for 23 bridges was done as part of the project. While this approach delayed the start of works until 2001, it allowed local consultants to familiarize with modern and effective survey and design techniques. The government was particularly eager to reduce the cost of supervision (estimated at above 15% of the works) by increasing its reliance on local consultants, a task that was accomplished gradually and also contributed to strengthen local capabilities. In general this component is considered satisfactory particularly in the area of know-how transfer. Future efforts in bridge management should emphasize the improvement of the economic evaluation of bridge investments, an activity mentioned at appraisal as part of the project but not carried out.
Road Safety. This component largely achieved its objective of setting the basis for sustainable road safety engineering and enforcement systems in Armenia. As a first step, the Government and the Bank ensured the development of an adequate institutional framework to coordinate intra-institutional efforts for project
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implementation. The Government in 2001 appointed the National Road Safety Council chaired by the Minister of Transport and subsequently developed the Council’s executive capacity with the creation of a Secretariat. In addition to a sound institutional setting, the Government and the Bank put considerable time and effort in the preparation of a comprehensive technical assistance, emphasizing the importance for the consultants to transfer experience and knowledge, assisting in institution building and development, introducing methods of data collection and statistic analysis, developing a comprehensive road safety program, and educating and increasing awareness regarding road safety issues. A Swedish consulting firm was retained for the job and by late 2003 (i) the Traffic Police department and AR had introduced a new accident data system (MAAP-5) to identify the nature of accident black spots; (ii) AR and Police experts received comprehensive road safety training locally through highly attended seminars and were introduced to the state of the art traffic safety measures in study tours to France, USA and Sweden; (iii) AR started to introduce safety audits in their road designs; (iv) a system of centers for vehicle inspection run by the private sector was established; (v) police enforcement had been enhanced with the use of credit-financed speed radars and educational campaigns; and (vi) the most important accident black spots in the network were removed through the project financed civil works. This highly satisfactory component was implemented at a total cost of US$4.49 million, well in line with the US$5.0 million estimated at appraisal.
Institutional strengthening of AR. This component was clearly designed to achieve two distinct objectives: (i) continue the financing of AR started in the previous project but now on a on a declining basis, so as to contribute to its gradual but full integration into the public sphere, and (ii) help to strengthen AR’s capacity for road management. The first objective, at least in terms of budgetary allocations, was achieved rather smoothly, with the Government eventually taking full responsibility for AR funding. The issue of the sustainability of an autonomous road agency able to have salary scales outside those in the civil service (which is considered a necessary condition to retain the highly qualified staff) was addressed by the government after the loan closing date, through the establishment of a Public Non-Commercial Enterprise.
With respect to the second item, successive supervision reports show a protracted exchange of ideas on the possible use of available funds, which ranged from improving the data bank for the pavement management system to adapting to Armenia work on design standards made by the EU for Russia. There was a clear reluctance of the Government to use credit funds for consultants, and Bank staff made every effort to secure grant funds for many of AR’s technical assistance needs. At the end, only about 10% of the available funds were used for a study on road financing and a study to develop proposals to advise the minister on the alternative legal and organizational responsibilities and functions of AR with the outcome mentioned in the previous paragraph. The ICR, because of the success in addressing the sustainability of AR, finds this component to be satisfactory.
B. Railway Component (US$15.2 million)Infrastructure Improvement. This component, originally designed to consume about 50% of the funds allocated to the railways, was eventually expanded to also include most of the funds envisaged to modernize the rolling stock. US$10.1 million worth of sleepers, fasteners, ballast, and other inputs were purchased and are gradually finding their way to track improvements, most to be performed through force account The shift was justified by the impossibility to advance with the rolling stock modernization program, basically because the lack of a market for the type of goods needed would have required spending important amount of funds without competition. Given the precarious state of the railways it is clear that improving its infrastructure is as much a priority as the overhaul of its rolling and traction equipment. The ICR finds this component to be satisfactory.
Improvement of Repair Facilities. This component comprised the purchase of equipment to modernize ARD’s existing repair facilities for a total of about US$0.89 million, as compared to the originally planned
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US$1.2 million. To some extent, the reduction was due to the experts’ recommendation of closing one of the two facilities, an idea that ARD is still considering.
Technical Support and Training. This component included mainly consultant services for preparation and supervision of works, at a total cost of about US$0.29 million, and the ARD study financed by the Austrian Trust Fund. As already discussed, this consultancy was instrumental in redirecting railway efforts towards very pragmatic short-term operational measures and infrastructure interventions to keep the railways going. While the government was reluctant to use credit funds to finance foreign consultants, most of the recommendations of the study were found relevant by ARD and implemented. The more institutional reform aspects intended in the project design, particularly those to support the unbundling of ARD into three different companies, became moot. The separation took place during project preparation, with the creation in 1998 of three joint stock companies. However the new organization, implemented at Bank's insistence, proved to have high operation and transaction costs, particularly for a railway with minimum activity. As a result the three firms were re-joined in early 2003 and only the accounting separation remains in place. Successive supervision reports and aide memoires discussed possible alternative uses for the funds in what appears to be a supply driven Bank effort, but except for a training program to improve the railways still unsatisfactory financial management, they did not materialize. Nevertheless, given the positive impact that the drafting of the business plan had in identifying ARD's problems and the sector policy decisions that need to be made to define the railways future role in Armenia's transport, the ICR finds this component satisfactory.
4.3 Net Present Value/Economic rate of return:At appraisal, the road improvement component, with an estimated cost of US$20 million without contingencies, representing 50% of the total project base cost, had a calculated EIRR of 76% and an estimated NPV of US$ 62.6 million. The original analysis was made for a network of 350 km and included a wide range of interventions. The ex-post evaluation, based on works carried out on 227 km of roads at a cost of US$25.6 million, yielded an estimated EIRR of 35% and a NPV of US$38.9 million. The difference between the ex-ante and ex-post estimates is due to the almost 100% increase in the cost per km of the works performed. This increase is explained by the deterioration suffered by the roads between the original studies and the actual start of the project, which shifted to works towards more expensive rehabilitations and reconstructions, a 30% increase in the price of bitumen, and the devaluation of the US Dollar during the project execution period. The EIRR is still satisfactory.
4.4 Financial rate of return:No financial rate of return was calculated as the main investments supported under the project would have only a marginal financial impact when compared to the important pricing and staffing policies undertaken by ARD. Attributing these changes only to the project would not be realistic.
4.5 Institutional development impact:The main institutional development impacts of the project were: (i) cementing a fairly lean organization for road management and securing the permanence of qualified professional staff in the sector; and (ii) raising awareness among government and railway officials of the need for a sound railway policy. These aspects of institutional development are discussed throughout the report.
5. Major Factors Affecting Implementation and Outcome
5.1 Factors outside the control of government or implementing agency:There were no factors outside the control of the government or implementing agency affecting the outcome of the project. As discussed above, the implementation of the project was revised to take into account the additional funding from the Lincy Foundation for road rehabilitation and periodic maintenance which
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triggered the reallocation of the credit funds towards routine maintenance.
5.2 Factors generally subject to government control:Three main issues subject to government control have had or may have an impact on project outcome: (i) road financing; (ii) institutional development; and (iii) sustainability.
Road Financing. Appropriate funding for road maintenance was a central element of the project. In general, the government met its obligations, but with frequent lapses requiring substantial IDA intervention. In one of those cases, as noted in Section 3 of this report, the size of the civil works component in 2002 was substantially reduced to free counterpart funds to compensate for the that year’s shortfall of agreed allocations for road maintenance. By the end of the project life, however, the government was allocating yearly to road maintenance the US$16 million agreed during credit negotiations. Availability of counterpart funds, a major problem in the previous project, was always timely.
Institutional Development. While the project helped to improve important technical aspects of roads and railways management practices, frequent changes at high levels of government, coupled with a bias towards short-term solutions, and lack of conviction vis-a-vis the reforms it supported, limited the institutional impact of the project. The government was not ready to develop a long-term vision for the sector or a clear definition of the role of the different sector institutions, particularly in terms of the level of autonomy of the management of the different transport modes. Ad-hoc decisions in terms of organization, investments or favoring local consultants in an effort to save resources at the expense of quality, diminished the impact of the project. Some actions, like the creation of the State Procurement Agency (SPA) which now procures state supported road works, including routine maintenance or the channeling of the Lincy foundation moneys for roads through the President's office undermined and confused AR role in the sector. These examples points to the fact that Armenia still has some way to go in order to introduce sound and transparent principles of public management in the transport sector. Nevertheless, the government was always open to a candid dialogue with IDA and implemented many of the latter’s suggestions, effectively improving sector management. Important priorities for the near future will be the establishment of a modus-operandi between AR and the government that furthers a client/supplier relationship and, as already mentioned, clear and frank discussions of what will be the role of the railways in the future and the steps to achieve the desired outcome.
Sustainability. Project sustainability, particularly the advances made in establishing in Armenia a quasi modern road management structure during the previous project and consolidating it under this project, might be jeopardized if AR is not given the clear role of an autonomous road agency and becomes only a legal figure to overcome limitations imposed by the current civil service pay scale. The future actions of the government to secure that the professionalism of AR will be used for objectively planning, programming and implementing road works are the key to guaranteeing project sustainability.
5.3 Factors generally subject to implementing agency control:Many of the railway reforms proposed under the project were not supported by part of the GoA and ARD management, which explains why most of the achievement of the project are circumscribed to measures to redimension and price railway services, but not to more profound structural reforms. In fact, the reversal after loan approval of the separation of the company into three companies dealing with infrastructure, freight and passenger services suggests that the ARD saw in the Bank a partner for financing their perceived needs, but not necessarily shared the Bank's views with respect to other railway matters. This disconnect between the Bank's and the railways visions, while not affecting the letter of the project (with emphasis on physical improvements) did impact its spirit of institutional modernization.
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5.4 Costs and financing:The total cost of the implemented project was US$49.17 million, about 5% above appraisal estimate. Comparisons however are not relevant since the project size and scope, as implemented, differed substantially from the originally planned. IDA financing amounted to 81% of total costs, while the GoA financed the rest. These costs do not include the contribution of the EU for the purchase of fiber optic that was installed with credit financing.
6. Sustainability
6.1 Rationale for sustainability rating:The overall sustainability of the modest institutional development and the infrastructure improvements supported by the credit appears as likely. The policy and institutional measures implemented provide a very basic framework for a well-managed sector. The rationale for this assertion is based on (i) the now well established and highly qualified group of road professional and the government’s efforts to retain them; (ii) the recognition of the “user fee” principles for road financing and the ongoing use of mechanisms for transferring fuel tax revenues to road maintenance; (iii) the by now mainstreamed road safety institutions and policies; and (iv) the proven positive effect of the railway policies on railway finances. It is unlikely that these achievements, all counting with strong government support, will be reversed.
6.2 Transition arrangement to regular operations:No transitional arrangements are being considered in the road sector. An ongoing PPIF (Public-Private Investment Facility) study might serve as the basis a Bank operation to further the restructuring of the railways.
7. Bank and Borrower Performance
Bank7.1 Lending:Project preparation was thorough and effective in those areas in which the Bank was able to rely in an in-depth knowledge of the country needs, particularly for the road sector components, which had basically the character of a follow on project. In the case of the railways, project preparation, although intensive in terms of supporting studies, remained fairly general and eventually, during the project life, the railways reversed the implementation of the separation of infrastructure and operations into three independent companies that had been a Bank requirement and substantially shifted efforts from the system superstructure to network infrastructure. These changes reflect an original project design that turned out not to coincide with the Borrower's perceived needs. To a great extent, the gradual adaptation of the project to the real needs of the country was made possible by a flexible project design. The important disconnect between the aims of the project and the actual intentions of the government in the area of railway reform and sector planning might be attributed to changes in government authorities although it might very well be the case that the Bank was overly prescriptive in the design of the project. Based on the above, project preparation is considered marginally satisfactory.
7.2 Supervision:IDA’s missions visited Armenia regularly twice a year to assess progress in the implementation of the project. The supervision team engaged in candid and enriching exchange of ideas with government officials and made a commendable effort to adequate the project to changing circumstances to keep it relevant. The team showed the right balance between the flexibility to adapt the project to the needs of the Borrower and the strict compliance with the spirit of the agreement. That was the case with the 2002 reduction of disbursements caused by the lower than agreed allocation of budgetary funds for road maintenance. The supervision team also contributed to refocus the railways component of the project bringing to it an element
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of pragmatism and detailed action plans that substantially contributed to the success of the project. Based on this, the ICR considers the supervision of the project as highly satisfactory.
7.3 Overall Bank performance:Based on the preceding discussion, the Bank’s performance is rated as satisfactory.
Borrower7.4 Preparation:The Borrower was actively engaged in project preparation and contributed to shape a project that built from the gains made during the previous road project and would tackle the difficult decisions involved in railway reform. This was done through intense and open interactions in which often the parties involved had differing opinions. Nevertheless, the government took decisive actions during project preparation, including the reduction of ARD’s staff and the creation of three independent railway companies. In retrospect, it is not clear if those actions showed the level of commitment and ownership of the Borrower with the proposed project or the Borrower felt compelled to undertake them in order to advance the processing of the credit. In any case, the Borrower did collaborate to a smooth project preparation. The Borrower was also forthcoming in creating the safeguard to avoid the counterpart funds problems encountered in the previous project, contributing thus to a much more effective execution. The rather abrupt vanishing from the start of project implementation of the main focus of the institutional component (i.e. transport planning), points to a weakness in all the members of the preparation team, including the Borrower.
7.5 Government implementation performance:The government implemented the physical components of the project with diligence and was open to exchange ideas on issues for which solutions are not always obvious and for which a succession of international experts, Bank staff and local authorities offered differing views. The fact that the government was ready to address the more difficult issues of tariff policies, traffic safety, and road financing is particularly commendable, even when the pace and the directions of the changes proved sometimes frustrating to the supervision team. The government took the necessary steps to avoid the problems of the previous project, which was frequently delayed by lack of counterpart funds. Although the allocation of funds for routine and winter maintenance was a major concern for the project, the government gradually increased funding until reaching the level agreed in the legal covenants. The reluctance of the government to retain international consultants and/or to fully discuss and rationally adopt certain policies recommended by these consultants was one of the main problems during project execution. A case in point is the refusal of GoA and the city to train local professionals in the use of the model for Yerevan urban transport developed by IDA's financed study. Instead, the government is proposing to carry out plans of dubious economic merits.
7.6 Implementing Agency:The central PIU, AR and ARD were eager to implement the project and showed an important level of commitment, ownership and participation. In the case of AR, an agency evolving from a Bank-financed Project Implementation Unit, the rather long-term relation with the Bank and experience with its rules and regulations, showed in a rather smooth implementation. ARD however was responsible for the implementation of a more difficult component, in which the Bank rules were not necessarily perceived as suitable for the needs of the project and for which there is naturally the need of a very gradual internalization and mainstreaming important changes in the culture of the agency, a challenge that was not fully understood during project preparation.
7.7 Overall Borrower performance:Based on the above the Borrower’s performance is considered satisfactory.
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8. Lessons Learned
There are three major lessons that can be learned from the project: the first refers to the by now very obvious need to develop ownership of a project, the second refers to the establishment of Bank-financed PIUs, and the third to the elusive pursuit of improving sector planning.
There seems to be a pattern of Bank projects promoting principles of commercial orientation, efficiency, transparency and accountability that are either not well understood or that are not necessarily perceived as applicable by Borrowing countries. That is particularly true for applying principles originally attributed to private sector management in countries in which the private sector did not exist. The Bank in those cases should carefully assess the conviction of the government to implement a new paradigm and its willingness to assume the sometimes heavy political cost that it implies. An overly prescriptive project, in which the Borrower feels compelled to implement measures for which they are not ready or in which they do not believe, is bound to fail or to have short-lived accomplishments. The Bank, unless the Borrower requests and is ready for an "all out" reform, should focus on the problems that the Borrower perceives to exist, should discuss the solutions that the Borrower proposes, and help them to arrive at a better solution using know-hows and methods the Borrower fully agrees with. In the process, the Bank should aim at disseminating the merits of the principles being supported to all the main players in the economy, particularly those that are watching over the government shoulders to improve the quality of public governance.
The Bank-financed establishment of a government agency with salaries well above those prevalent in the civil service usually poses serious sustainability problems. In the case of Armenia, the future of AR and the retention of a cadre of highly competent professionals depended on the willingness of the government to create a company with a considerable degree of independence from the central authorities. In this case, the issue of the sustainability of an autonomous road agency able to have salary scales outside those in the civil service (which is considered a necessary condition to retain the highly qualified staff) was addressed by the government just after the loan closing date, through the establishment of a noncommercial public company. This is a case in which a long term Bank involvement succeeded in creating a lean agency staffed with high caliber professionals in a move that might spearhead revisions of civil salaries in selected areas. Even if that is not the case, the particular success of the project in ensuring the professionalism of AR suggest the need to review with a new light the usually suboptimal ratings associated with Bank financing of public wage bills.
The Bank has a very long and not particularly successful experience in trying to improve sector planning, reducing the level of political influence in project selection and improving the allocation of scarce resources. Time and again the results are below expectations. Usually the sector authorities lack the incentives to improve planning or are unable to withstand the political pressure to invest in projects of dubious economic merits. The Bank should consider involving in the process relevant stakeholders outside the sector to provide the necessary incentives. In countries with a weak civil society, a more relevant interlocutor might be the Ministers of Finance or Economics, who are responsible for ensuring fiscal and monetary responsibility.
Finally, a word or two about the Bank’s processes. The project did have an impact because it provided sufficient flexibility to adapt to changing demands. The railway component was substantially revised. Also, supervision reports show Bank staff eager to suggest possible uses for the technical assistance moneys that were not being spent for improving sector planning. In a sense, both for the railway component and for the institutional development component, the project became a “quasi” credit line that
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could be used as necessary, provided that sector policies were moving in the right direction. This approach, which reflects the reality of project implementation and should therefore be encouraged, contradicts the very detailed project descriptions and project execution plans required in the PAD and supporting documents. The Bank should careful consider the consistency between the lead- time and resources provided for project preparation and the level of detail required in the documentation.
9. Partner Comments
(a) Borrower/implementing agency:The following letter was received from the Borrower on June 27, 2005. In addition, the PIU provided a detailed contribution which is reflected in the ICR.
Mr. Rodger Robinson
Country Manager for Armenia
The World Bank
Dear Mr. Robinson,
Re: Transport Project (Credit 3375-AM) – Comments 011 ICR
In addition to the comments on the draft ICR submitted by the letter reference 01-21/2165 dated 16.06.2005 attached please find the Ministry of Transport and Communication of Armenia evaluation of the Bank’s and Borrower’s performance of their obligations under the Credit Agreement and the extent to which the purposes of the Credit were achieved.
Sincerely,
A.Manukyan
CC: Mr. Vardan Khachatryan, RA Minister of Finance and Economy
Mr. Vahram Nercissiantz, Chief Economic Advisor to the President
Mr. Gagik Minasyan, Head of Financial and Budgeting Commission
Mr. Ad Melkert, Executive Director for Armenia, the World Bank
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MINISTRY OF TRANSPORT AND COMMUNICATION OF ARMENIA EVALUATION OF THE BANK’S AND BORROWER’S PERFORMANCE OF THEIR OBLIGATIONS
UNDER THE CREDIT AGREEMENT AND THE EXTENT TO WHICH THE PURPOSES OF THE CREDIT WERE ACHIEVED
BORROWER/IMPLEMENTING AGENCY
Introduction
The Armenia Transport Project was a logical development of achievements accomplished under the Armenia Highway Project with focus to strengthen the institutional progress made in transforming Armenian Roads (AR) into an effective road agency, push reforms in the Armenian Railways (ARD), strengthen the Ministry of Transport and Communication (MTC) planning functions. The Project also aimed to secure appropriate mechanisms for stable funding of road maintenance and corresponding level of the AR highly professional staff salaries from the state budget.
Project Objectives
As stated in PAD, the Armenia Transport Project had the following three main objectivities:
(i) To improve the main road network, with commensurate reductions in total transport costs, to improve road safety and to increase the operational efficiency of Armenia Roads SSCC (AR)
(ii) To improve the rail service between Yerevan and Georgian border and the financial and managerial performance of the Armenia Railway Department (ARD)
(iii) To straighten the planning capacity of the Ministry of Transport and Communications, particularly in the use economic analysis as a basis setting priorities and making investment decisions in the transport sector, and in establishing a basis for improvement of urban transport services in Yerevan.
The overall objective of improving the main road network and railway service between Yerevan and Georgian border to reduce total transport costs has been fully achieved. The interstate roads network and railway infrastructure had gained noticeable improvement; safety of the transportations has increased correspondingly. The Armenia Roads SSCC has been transformed to Armenia Roads Directorate. Introduction of “user fee” principle based mechanism of funding allowed provision of state budget sustainable allocations for roads maintenance and retaining highly professional staff and operational efficiency of the AR. The Armenian Railways became profitable company in 2001 and increased its financial performance from year to year. While shifting funds for straightening the planning capacity of the MTC to modernization of legal framework of the transport sector, the one of the main institutional priorities of the MTC has been achieved. Yerevan Urban Transport Study has reviewed urban transport in Yerevan and provided very useful traffic forecast and the modal split model, a tool for evaluation of different urban
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transport scenarios, and corresponding financial analysis of capital and recurrent expenditures needs. Given the above mentioned the Borrower finds that the Project overall objectives were successfully achieved.
BANK AND BORROWER PERFORMANCE
Bank
While the Project preparation was thorough and effective for roads component, in case of railways and MTC the Bank was overly prescriptive in the design of the Project. Fortunately, during the Project implementation the design was changed in order to response to the Borrower’s actual needs. It was made possible due to commendable efforts of the Bank’s team to fairly discuss with the Borrower any issues that aroused during the Project implementation and address the country real needs keeping the right balance between the flexibility of the Project design and the strict compliance with the spirit of the credit agreement. The Project team always was in time with providing corresponding follow-up to any procurement activity that needed the Bank’s approval. Effective work of the disbursement team made possible to avoid delays in payments for works done and goods delivered. The Resident Mission within its competence provided necessary support. Based on the above, the Borrower considers the Bank’s performance as satisfactory.
Borrower/Implementing Agency
The Borrower was actively involved in the Project design through open interactions with the Project preparation team. In retrospect, it obvious that the Borrower had to critically evaluate viability of the Project designed objectives based mostly on international expert’s recommendations. The Borrower implemented the Project in strict compliance with the credit agreement and the Bank guidelines requirements. The Borrower’s any action that needs Bank’s prior approval was always properly proceeded by the implementing agency. The Government always was open to discuss the issues for which solutions are not obvious and sometimes the Bank’s view differs from the Borrower’s vision. The Borrower secured timely provision of counterpart funds. Although at the beginning of the Project allocation of funds for winter and routine maintenance was modest, year-to-year increasing these amounts the Government achieved the level committed by the credit agreement. The Transport PIU, AR and ARD within their competence rather smoothly implemented the Project. Based on the above, the Borrower’s performance is considered satisfactory.
(b) Cofinanciers:There were no cofinanciers.
(c) Other partners (NGOs/private sector):None.
10. Additional Information
No additional information.
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Annex 1. Key Performance Indicators/Log Frame Matrix
Outcome / Impact Indicators:
Indicator/Matrix
Projected in last PSR1
Actual/Latest Estimate
ERRs for road and bridge improvements better than 20%
20%+ 35%
Improve roughness of principle 800 km of roads
4.0 3.1
Reduce road fatalities per 10,000 vehicles 12.1 per 10000 vehicles 10.5ARD working ratio 88% in 2004 78%Reduce transit time between Yerevan and the Georgian border
10hrs. Railway Works completed-Railway transit time-6.8 hours
Ministry makes sound recommendations for PIP
Not accomplished Not accomplished
Output Indicators:
Indicator/Matrix
Projected in last PSR1
Actual/Latest Estimate
Rehabilitate roads and bridges 350 Km (roads); 10 (bridges) 227 km of road rehabilitated, 786 km maintained11 bridges improved
PMS installed Installed Installed
Periodic and some routine maintenance contracted
100% (periodic & routine) All periodic maintenance contracted
Improved financial management Installed Installed
Tracks installed, bridges required, contact wire installed, telecom cable installed, locomotives overhauled, coaches overhauled
40 Km (tracks); 4 (bridges); 150km (contact wire); 42 km (telecom cable); 33 (locomotives); 20 (coaches)
55.67km track, 55 bridges rehabilitated, installation of 15 set switches and 309km optic cable. Procurement and installation of depot equipment. Procurement of coach spare parts for USD 0.4 million . Works on 16.6km of track still in progress, financed by AR.
Recommended investments based on economic criteria
Not achieved Not achieved
Urban transport study Study completed Study completed1 End of project
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Annex 2. Project Costs and Financing
Project Cost by Component (in US$ million equivalent)AppraisalEstimate
Actual/Latest Estimate
Percentage of Appraisal
Component US$ million US$ millionRehabilitation of Road Network 26.80 33.30 1.24Railway Restructuring 13.20 14.79 1.12Support for MTC 0.80 0.91 0.14
Total Baseline Cost 40.80 49.00 Physical Contingencies 4.10 0.00 Price Contingencies 2.10 0.00
Total Project Costs 47.00 49.00Total Financing Required 47.00 49.00
Project Costs by Procurement Arrangements (Appraisal Estimate) (US$ million equivalent)
Expenditure Category ICBProcurement
NCB Method
1
Other2 N.B.F. Total Cost
1. Works 23.70 2.55 0.00 1.70 27.95(19.81) (2.29) (0.00) (0.00) (22.10)
2. Goods 14.85 0.00 0.60 0.00 15.45(0.00) (0.00) (0.60) (0.00) (0.60)
3. Services 0.00 0.00 2.70 0.30 3.00(0.00) (0.00) (2.70) (0.30) (3.00)
4. PIU Operational Cost 0.00 0.00 0.60 0.00 0.60(0.00) (0.00) (0.60) (0.00) (0.60)
Total 38.55 2.55 3.90 2.00 47.00(19.81) (2.29) (3.90) (0.30) (26.30)
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Project Costs by Procurement Arrangements (Actual/Latest Estimate) (US$ million equivalent)
Expenditure Category ICBProcurement
NCB Method
1
Other2 N.B.F. Total Cost
1. Works 27.09 3.56 0.10 1.74 32.49(22.53) (2.95) (0.07) (0.00) (25.55)
2. Goods 13.17 0.00 0.33 0.00 13.50(12.94) (0.00) (0.25) (0.00) (13.19)
3. Services 1.60 0.00 0.48 0.06 2.14(1.51) (0.00) (0.38) (0.00) (1.89)
4. PIU Operational Cost 0.00 0.00 0.87 0.00 0.87(0.00) (0.00) (0.60) (0.00) (0.60)
Total 41.86 3.56 1.78 1.80 49.00(36.98) (2.95) (1.30) (0.00) (41.23)
1/ Figures in parenthesis are the amounts to be financed by the IDA Credit. All costs include contingencies.2/ Includes civil works and goods to be procured through national shopping, consulting services, services of contracted staff
of the project management office, training, technical assistance services, and incremental operating costs related to (i) managing the project, and (ii) re-lending project funds to local government units.
Project Financing by Component (in US$ million equivalent)
Component Appraisal Estimate Actual/Latest EstimatePercentage of Appraisal
Bank Govt. CoF. Bank Govt. CoF. Bank Govt. CoF.Works 22.10 5.85 26.02 25.55 7.19 117.00 115.6 122.9 449.7Goods 14.60 0.85 0.00 13.09 0.29 0.00 89.7 34.1 0.0Services 3.30 0.30 0.00 2.59 0.29 0.00 78.5 96.7 0.0Total 40.00 7.00 0.00 41.23 7.17 0.00 103.1 102.4 0.0
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Annex 3. Economic Costs and Benefits
The ex-post economic evaluation was carried out using the Highway Design Model (HDM) which measured the reduction of vehicle operating costs due to the improved riding surface and reduction of road roughness. The analysis, carried out on a network of 227 km of roads quantified the economic impact of optimal rehabilitation and maintenance interventions over the network amounting to US$25.6 million. The evaluation yielded an estimated economic rate of return of 35% and an estimated net present value of US$38.9 million.
Length Cost IRI AADT NPV EIRRContracts Before After 2004
km USD mm/m mm/m vpd mln USD
%
Contract CM 1/2000 comp. 1 18.7 542876 5.7 3.2 9359 7.21 87.6Contract CM 1/2000 comp. 2 18.7 662754 5.9 3.4 9359 5.48 79.5Contract CM 1/2002comp. 1 6.74 711152 10.5 2.8 1269 0.71 32.5Contract CM 1/2002comp. 2 8.41 1415782 8.5 3.1 1269 0.34 15.7Contract CM 1/2002comp. 3 7.32 1133098 7.9 2.9 1269 0.44 16.6Contract CM 1/2003comp. 1 5.9 603514 5.9 2.8 2376 0.37 21.9Contract CM 1/2003comp. 2 5.1 594606 7.2 2.7 2376 0.73 25.3Contract CM RS ICB 1/2003-1 9.57 951464 8.2 2.9 2376 2.08 29.8Contract CM 2/2000 comp. 1 3.5 885380 9.6 3.2 1789 0.33 17.5Cotnract CM 2/2000 comp. 2 5 786975 8.5 3.1 1789 0.42 16.4Cotnract CM 2/2000 comp. 3.1 11.63 1177628 7.9 3 875 1.03 21.5Contract CM 2/2002 comp. 1 7.38 1049394 7.3 3.1 1321 0.78 25.4Contract CM 2/2002 comp. 2 7.77 1106873 7.5 2.8 1321 0.82 26Contract CM 3/2000 2.6 556418 8.9 2.6 2216 0.44 49.9Contract CM 3/2003 comp. 1 9.8 1180696 5.8 2.8 2216 2.42 33.5Contract CM 3/2003 comp. 2 7.02 1014631 7.1 3.1 2459 1.85 32.8Contract CM 3/2003 comp. 3 5.75 13400744 8.1 3.1 3654 1.95 37.4Contract CM-RS 2/2001 (road M3) 9 333255 5.1 3.2 4613 1.66 42.2Contract CM-RS 1/2001 (road M5) 5.3 416357 6.1 2.8 6158 1.72 45Contract CM 6/2004 comp. 5 4.8 558947 8.3 3 1146 0.52 25.7Contract CM 6/2004 comp. 6 4.95 679181 7.5 3 1146 0.42 20.3Contract CM 6/2004 comp. 7 8.06 1049555 7.8 3.1 1146 0.79 23Contract CM 7/2000 comp. 1 6.76 832311 6.8 2.9 1710 1.21 26.2Contract CM 7/2000 comp. 2 9.33 1073598 5.9 2.8 1658 1.13 21Contract CM 7/2003 comp. 1 4.02 443757 7.4 3.1 1710 0.51 26.9Contract CM 7/2003 comp. 2 3.88 471092 6.1 3 1341 0.02 12.4Contract CM 7/2003 comp. 3 11.24 1300431 5.9 3.2 1341 0.09 13Contract CM 7/2003 comp. 4 3.41 1007062 9.1 2.6 1341 0.01 12.5Contract CM 12/2000 comp. 1 5.31 599913 7.9 3.1 967 1.54 36.1Contract CM 12/2000 comp. 2 5.1 519072 8.2 3.2 967 1.43 26.3Contract CM LOC 1/2004 comp.1 1.15 93392 7.2 3.3 512 0.23 14.5Contract CM LOC 1/2004 comp.2 0.92 108198 7.2 3.2 512 0.21 13.6Contract CM LOC 2/2004 3.12 83617 9.7 4.5 456 0.04 15.6TOTAL 227.24 25184223 38.93Weighted average 7.14 3.1 35.1
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Annex 4. Bank Inputs
(a) Missions:Stage of Project Cycle Performance Rating No. of Persons and Specialty
(e.g. 2 Economists, 1 FMS, etc.)Month/Year Count Specialty
ImplementationProgress
DevelopmentObjective
Identification/Preparation05/1998 2 TM, Economist09/1998 3 TM, Economist, RS02/1999 5 TM, Economist, RS, UTS, FA
Appraisal/Negotiation07/1999 5 TM, Economist, PS, FA, BC
Supervision05/2000 3 TM, Economist, PS S S09/2000 6 TM, Economist, RS, FA, PS, HE S S02/2001 2 TM, FA S S06/2001 2 Economist, Operations Officer S S11/2001 3 TM, Economist, PS S S04/2002 3 TM, Economist, PS S S10/2002 4 TM, Economist, PS, FA S S05/2003 5 TM, FA, Economist, RS, PS S S10/2003 4 TM, TS, Economist, RS, PS S S/01/2004 4 TM, PS, Operations Officer, FA S S09/2004 3 TM, TS, PS S S
ICR
Abbreviations: TM = Task Manager, TS = Transport Specialist, RS = Railway Specialist, PS = Procurement Specialist,FA = Financial Analyst, HE = Highway Engineer, UTS = Urban Transport Specialist, BC = Bridge Consultant
(b) Staff:
Stage of Project Cycle Actual/Latest EstimateNo. Staff weeks US$ ('000)
Identification/Preparation No longerAppraisal/Negotiation supported by 343Supervision Bank information 445ICR Systems 30Total 818
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Annex 5. Ratings for Achievement of Objectives/Outputs of Components(H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable)
RatingMacro policies H SU M N NASector Policies H SU M N NAPhysical H SU M N NAFinancial H SU M N NAInstitutional Development H SU M N NAEnvironmental H SU M N NA
SocialPoverty Reduction H SU M N NAGender H SU M N NAOther (Please specify) H SU M N NA
Private sector development H SU M N NAPublic sector management H SU M N NAOther (Please specify) H SU M N NA
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Annex 6. Ratings of Bank and Borrower Performance
(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory)
6.1 Bank performance Rating
Lending HS S U HUSupervision HS S U HUOverall HS S U HU
6.2 Borrower performance Rating
Preparation HS S U HUGovernment implementation performance HS S U HUImplementation agency performance HS S U HUOverall HS S U HU
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Annex 7. List of Supporting Documents
Project Appraisal Document, The World Bank, 2000Project Status reports and Mission Aide-MemoiresVarious studies prepared under the project:
Harral, Winner, Thompson, Sharp, Lawrence (2000): Armenia Railways Five-year Business PlanlVictor Alalouf (2001): Point-to-point cost model and system for Armenia RailwayslThornton Amyot (2004): Update of the Five-Year Business Plan for the Armenia RailwayslAustria Rail Engineering (2001): Consultancy to Assist Armenia Railways to Reduce Wear Of lRails and Wheels.The World Bank (2002): Armenia Poverty UpdatelSWECO Intern./ Hill International (2004): Yerevan Urban Transport Study. Final Report with lAnnexes (and several interim reports and task specific reports).Charter (2004) of: Armenia Roads Directorate--Non-commercial State Organization l
Armenia Landslide Project (2000) (Final Report) by D2 Consult, Austrial
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Bavra
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Verdaghbiur
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MINGECHAURSKOYERESERVOIR
Kura R.
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Ashotsk
Amasiya
TashirAlaverdi
Dzoramut
Step'anavan
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GYUMRI
Toumanian
Ijevan
Noyemberian
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VardenisMartuni
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To ShakhtakhtyTo Shusha
To Nakhichevan
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To Zangelan
To Zangelan
T U R K E Y
I S L A M I C
R E P U B L I C
O F I R A N
A Z E R B A I J A N
GEORGIA G E O R G I A
IBRD 30837R
JUNE 2005
Akhurit
Markara
Bagaran
Karakala
Yeraskh
KajaranThis map was produced by theMap Design Unit of The World Bank.The boundaries, colors, denominationsand any other information shown onthis map do not imply, on the part ofThe World Bank Group, any judgmenton the legal status of any territory, orany endorsement or acceptance ofsuch boundaries.
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REHABILITATEDUNDER PROJECT EXISTING