Document of The World Bank FOR OFFICIAL USE ONLY Report No.: 17553 IMPLEMENTATION COMPLETION REPORT REPUBLIC OF GUINEA SECOND WATER SUPPLY PROJECT (Cr. 1985-GUI) March 30, 1998 Water and Urban 2 Africa Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS Currency Unit = Guinean Franc (GNF) US$1.00 = 1,000 GNF (at closing) US$1.00 = 500 GNF (at appraisal) WEIGHTS AND MEASURES Metric System FISCAL YEAR OF BORROWER January 1 - December 31 ABBREVIATIONS AND ACRONYMS AfDB Africarn Development Bank BADEA Arab Bank for Economic Development in Africa CCCE French Aid Agency DEG National Water Company DGSE Directorate for Energy EIB European Investment Bank FIM Foreign Investor Manager LCR Lease Contractor Rate MRNE Ministry of Natural Resources and Environment MSP Management Support Program NGO Non-governmental Organization RWS Rural Water Supply SEEG Water Management Company SNAPE Rural Water Supply Agency SONEG National Water Authority SSE State Secretariat for Energies UFW Unaccounted-for-water UTNDP United Nations Development Program UWS Urban Water Supply Vice-President :Jean-Louis Sarbib, AFRVP Country Director :Marnadou Dia, AFC16 Sector Manager :Letitia A. Obeng, AFTU2 lTeam Leader :Yao Badjo, AFTU2 FOR OFFICIAL USE ONLY REPUBLIC OF GUINEA SECOND WATER SUPPLY PROJECT (Credit 1985-GUI) IMPLEMENTATION COMPLETION REPORT TABLE OF CONTENTS PaFe Preface ........................................................i Evaluation Summary ........................................................i PART I - Project Review from Bank's Perspective ........................................................1 Project Identity ........................................................1 A. Background ........................................................1 B. Statement and Evaluation of Project Objectives .......................................................2 C. Implementation Record and Achievement of Project Objectives ..........................................3 D. Major Factors Affecting the Project .......................................................6 E. Project Sustainability .......................................................7 F. Bank Performance ........................................................8 G. Borrower Performance ....................................................... 8 H. Assessment of Outcome ...................................................8.....,.8 I. Future Operations ........................ ............................... 9 J. Key Lessons Learned ........................................................9 Part II. Tables ........ 11 Table 1 - Summary of Assessments ..........................11 Table 2 - Related Bank Loans/Credits ......................... 13 Table 3 - Project Timetable ................. 13 Table 4 - Loan/Credit Disbursements ., 14 Table 5: Key Indicators for Project Implementation ................................... 15 Table 6: Key Indicators for Project Operations ................................... 16 Table 7: Studies Included in Project ................................... 17 Table 8A - Project Costs .17 Table 8B: Project Financing .18 Table 9 - Economic Costs and Benefits .18 Table 10 - Status of Legal Covenants .19 Table 1I - Estimated Bank Resources: Staff Inputs .20 Table 12 - Bank Resources: Missions .21 ANNEXES A. Mission's aide-memoire .22 B. Borrower's Evaluation of the Project .28 C. Summary of Consumer's Contribution to the ICR .31 D. Economic Analysis .33 E. Map This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. IMPLEMENTATION COMPLETION REPORT REPUBLIC OF GUINEA SECOND WATER SUPPLY PROJECT (Credit 1985-GUI) PREFACE This is the Implementation Completion Report (ICR) for the Second Water Supply Project in the Republic of Guinea for which a credit 1985-GUI in the amount of SDR 29.3 million (US$40 million equivalent) was approved on May 3, 1989 and made effective on October 5, 1989. The credit was closed on October 31, 1997 one year after the scheduled closing date of October 31, 1996. Final disbursement took place on November 19, 1997 at which time a balance of SDR 102,000 (US $139,000 equivalent) was canceled. Co-financing for the project was provided by the African Development Bank, the Caisse Centrale de Cooperation Economique, the European Investment Bank, and the Japan International Cooperation Agency. The ICR was prepared by Yao Badjo, (Senior Sanitary Engineer AFTU2), and Tejbir Singh Phool (Consultant) to the Africa Region and reviewed by Letitia A. Obeng (Sector Manager, AFTU2). Gilles Fabre-Rousseau (Water and Sanitation Specialist, TWUWS), and Richard Verspyck (Principal Water and Sanitation Specialist, AFTU2) are Peer Reviewers. Preparation of this ICR was begun in conjunction with the Bank's final supervision/completion mission on October 15-25, 1997. The borrower contributed by providing pertinent information and commenting on the draft ICR. The borrower also has prepared a separate evaluation of the project's preparation and execution. The stakeholders have contributed to the preparation of the ICR. The evaluations and contributions are attached. REPUBLIC OF GUINEA SECOND WATER SUPPLY PROJECT [Credit 1985-GUll IMPLEMENTATION COMPLETION REPORT Evaluation Summary Introduction 1. In 1985, a new Government in Guinea embarked on a series of donor supported economic reforms with the main objective of restructuring the economy and reducing the role of the state. In 1988, only 40% of the urban population had access to piped water. Morbidity due to enteric and parasitic diseases was high, cholera outbreaks were regularly reported, and life expectancy was among the lowest in the world. 2. IDA's initial entry into the sector was in the form of the Conakry Water Supply and Sanitation Project (WSP-1). This project helped increase the quantity of water for Conakry and improved drainage conditions. However, the most important component, institutional strengthening was not achieved and results were unsatisfactory. A key lesson learned was that additional technical assistance must be accompanied by a radical reshaping of institutional responsibilities, preferably through a degree of privatization. 3. Influenced by the lessons of the WSP-I, the new Government opted for a strategy that would use the private sector to improve efficiency. A sector re-structuring resulted in the establishment of two companies in late 1988. A state owned National Water Authority, Societe Nationale des Eaux de Guin6e (SONEG) was established as the owner of the facilities responsible for sector development including implementation of new projects, issuance of consolidated sector accounts, and debt service. A Management Company, Societe d'Exploitation des Eaux de Guin&e (SEEG) with a majority private sector share (51%), and minority government participation (49%) was formed to operate and maintain facilities and collect charges within the framework of a ten year lease contract with SONEG. Project Objectives 4. The Second Water Supply Project (WSP-II) was structured with the main goal of creating a legal, institutional, technical, and financial framework that would constitute a sound basis for further sector development. Reshaping of institutions was given prime importance, and injecting professional know how via private sector participation was to be an important tool. A schedule for systematically raising water rates and eliminating subsidies was developed. The project's goals were timely and incorporating the private sector in this next investment was a relevant decision. Implementation Experience and Results 5. The main goal of creating a legal, institutional, technical, and financial framework was largely achieved. Specific project objectives were achieved and most components were completed, with some delays, but within reasonable budget constraints. Credit covenants were also largely complied with. ii The total expenditures on the project were US $105.6 million against projections. of 102.6 million. The difference is accounted for by changes in the SDR-US dollar exchange rate and by additional grant funding of US $5.6 million provided by the Japanese Government. 6. In an effort to advance the institutional development process, conditions were imposed for credit negotiations and effectiveness. These were met in a timely fashion and SONEG and SEEG continued making progress. SONEG fully adopted the principle of a three-year rolling "contrat plan" and emerged a much stronger institution than its predecessor. The management took its responsibility to finance investments and maintain assets seriously, and capacity improved. 7. Although procurement was initially delayed, SONEG and SEEG were able to complete most physical components related to raw water transmission, treatment, storage, and treated water transmission less than two years later than the schedule projected in the SAR. Since construction costs were lower than the SAR estimates, a one-year extension was negotiated with the Bank to use the savings for constructing additional storage and to install extra miles of distribution network. However, there was a shortfall in the number of connections completed; these will be completed almost two years late. 8. Private sector involvement resulted in improved operations, and SEEG rehabilitated commercial and financial systems. By 1996 approximately 95% of water was sold through metered connections. Collection efficiency from private customers rose to a peak of 75% in 1990 but declined later due to the high tariff level. The number of connections in Conakry grew fiom 12,000 in 1988 to over 23,000 in 1996 and corresponding coverage grew from 40% to approximately 60%. The Government approved tariff increases on time and subsidies were eliminated in 1995, as scheduled. 9. During the project implementation, the two autonomous but co-dependent agencies SONEG and SEEG faced new relationships and unforeseen challenges. While the resolution of resulting issues has sometimes been slow and problematic, over time, the implementation progress has largely been achieved. Systems are evolving to reduce the likelihood of major problems recurring under the Third Water and sanitation project. 10. The reorganization has had a strong positive impact on the urban water sub-sector. Developments in both sector organizations, SONEG and SEEG, have contributed significantly towards achieving sustainability. However, water pricing, expansion of the distribution system, reduction in UFW, and SONEG's weakness in performing its regulatory function remain to be addressed. The ongoing Third Water Supply & Sanitation Project supported by the Bank is aiming to correct the shortcomings of the Second Water Project. This project includes components to improve the distribution system, strengthen SONEG's regulatory capacity, and to assist SONEG prepare and negotiate a new lease contract that will comprise a performance contract between SONEG and SEEG. Overall, sustainability is rated as likely. 11. Bank performance was highly satisfactory during identification, preparation and appraisal; it was satisfactory in supervision. At each stage, Bank staff moved adequately to address relevant problems or issues. Borrower performance was also highly satisfactory during project identification, preparation and appraisal; it was satisfactory in supervision. The Government, SONEG, and SEEG played vastly improved roles but problems were encountered in pricing, procurement and UFW. iii 12. Project objectives were largely achieved. While there were shortcomings such as procurement delays, incomplete development of SONEG, and problems with managing SEEG, sector operations have improved very significantly over the performance displayed by the previous organization. The outcome is rated as satisfactory. Summary of Findings, Future Operations, and Key Lessons Learned 13. This project demonstrated that private sector participation can contribute to achievement of sector objectives. Stakeholders invited to a project closing meeting commented that very significant gains had been made in water quality and delivery. However, despite significant achievements, more improvements are necessary. While coverage has increased significantly, it is still limited to 60 percent. SONEG has allowed SEEG to get away with a poor reporting record. Water tariffs are high and are impeding growth in coverage as well as in SEEG's revenues. The present level of physical water losses is also high (approximately 47%). These factors suggest an unrealized potential. 14. The Government, SONEG, and SEEG are very committed to consolidate on the gains made so far in urban water sector and this, with the support of the world Bank, The Third Water Supply & Sanitation Project (WSP-lI) which was made effective in August 1997 has allocated US$ 16.8 million for addressing the shortcomings of the WSP-II and will enhance the distribution system in Conakry, strengthen SONEG's regulatory capacity, and assist in the preparation and negotiation of a new lease contract. The Government has submitted an action plan for the water sector improvements. Rehabilitation will be followed by carefully planned expansion of existing systems to serve to a rapidly increasing population. 15. The sector's performance will continue to depend on the pace at which SEEG reduces UFW and on the lease contract through the incorporation of monitoring indicators that will be renegotiated in 1999. SONEG's strategy will be to manage water demand more effectively by instituting an appropriate tariff policy, and to develop an improved incentive structure that will maximize the efficiency of SEEG's water operations. Tariffs will be adjusted to reflect actual costs taking into account the capacity for the consumer to pay through a program of social connections for the poor. 16. The following key lessons have been learned from the implementation of this project. * The sector reorganization that entailed establishment of autonomous agencies and private sector participation served to significantly improve sector performance. * However, universal improvements in efficiency should not be taken for granted even in a privately operated system. * When a lease contract is being designed, short-term and long-term incentive structures should be carefully created to meet precisely articulated objectives to maximize the efficiency of the private sector operations. * In the interest of the consumer protection, a strong regulatory and oversight function is very important to control private sector operations. * To increase transparency in operations when a private operator functions as a system operator and as a construction contractor, separate financial statements of its different functions are highly recommended. REPUBLIC OF GUINEA SECOND WATER SUPPLY PROJECT [Credit 1985-GUI] IMPLEMENTATION COMPLETION REPORT PART I - PROJECT REVIEW FROM BANK'S PERSPECTIVE PROJECT IDENTITY Name: Second Water Supply Project Credit Number: 1985-GUI RVP Unit: AFRICA Region Country: Republic of Guinea Sector: Water Supply A. BACKGROUND 1. Guinea gained independence from France in 1958 and adopted a state-led development policy that soon ran into difficulties. The economy became increasingly dualistic with the official sector relying on bauxite exports and functioning through a system of administered prices linked to a highly overvalued currency. Private sector activities were increasingly forced underground, and the informal sector obtained its foreign exchange through clandestine exports and private transfers from abroad. A massive emigration of the elite, mostly for political and security reasons, considerably weakened Guinean institutions with effects that are still being felt today. The Government's financial position deteriorated significantly mainly because of the lackluster performance of the state enterprise sector, and infrastructure deteriorated. 2. In 1985, a new government embarked on a series of economic and financial reforms supported by the IDA, the IMF, and bilateral donors. Their main objective was to radically restructure the economy by reducing the role of the State and by relying on the private sector as the main engine of economic growth. 3. In 1988, only 10 out of 33 urban centers, less than 40% of the urban population of 2.3 million, and less than 20% of the rural population of 4.5 million received piped water. There was no sewerage except in the oldest part of Conakry. Fewer than 10% of population used flush toilets, and 60% relied on pit latrines. Rural sanitation did not exist. Morbidity due to enteric and parasitic diseases was high, cholera outbreaks were regularly reported, and life expectancy in Guinea (37 years at birth) was among the lowest in the world. Guinea was classified among the least developed countries, by the UN. 4. Also in 1988, the State Secretariat for Energies (SSE), a branch of the Ministry of Natural Resources and Environment (MRNE) was responsible for the Urban Water Sector (UWS). The rural water supply (RWS) sector had recently been developed, mainly with external financing, by the Service National dAmenagement des Points d'Eau (SNAPE) under the Ministry of Agriculture. Several agencies were responsible for sanitation. 2 5. IDA's initial entry into the sector was undertaken under the old regime and took the shape of the Conakry Water Supply and Sanitation Project (WSP-I, Credit 870-GUI). This credit of US$ 12.5 million was approved in December 1976, closed in March 1985 and co-financed by the African Development Bank (AfDB) in an amount equivalent to US$6 million. Project objectives were to strengthen institutions, restore a satisfactory water supply level, and provide sanitation in Conakry. The project helped increase the quantity of water supplied to Conakry and improved drainage conditions. However, the most important component, institutional strengthening, was not achieved and results were unsatisfactory because of implementation delays, incomplete physical accomplishments, and poor financial performance. Political interference and the previous regimes poor economic policies were key impediments. At project closing, the distribution system was largely unmetered, the number of connections was not fully known, and unaccounted for water could not be accu rately estimated. A key lesson learned was that additional technical assistance must be accompanied by a radical reshaping of institutional responsibilities, preferably by a degree of privatization (World Bank Report No. 6922). B. STATEMENT AND EVALUATION OF PROJECT OBJECTIVES 6. The Second Water Supply Project (WSP-II) was structured with the main goal of creating a legal, institutional, technical, and financial framework that would constitute the basis for a sound take- off and further sector development. Reshaping of institutions was given prime importance, and injecting professional know-how via private sector participation was to be an important tool. Detailed objectives included the following: (a) strengthening the planning and management capabilities of the agency responsible for sector development, SONEG; (b) rehabilitating the technical, commercial and financial operations of the sector through a lease contract between SONEG and SEEG; (c) expanding the saturated Conakry water supply system, to generate additional revenues with the side objectives to allow further development in less profitable secondar centers; and (d) gradually setting water rates to meet the long-term marginal cost. The goal of setting tariffs to meet long-term marginal cost required a plan for increasing water rates. Since the Government and Bank wanted to avoid a drastic tariff increase, an innovative, short-term, progressively diminishing, and transparent subsidy was planned. 7. The following components were designed to achieve these objectives: (a) a management support program to SONEG including (i) technical assistance to the General Manager and to the department of Studies and New Works; (ii) services of a consultant for regular revision of water rates and of a legal counsel; (iii) audits: (iv) training of higher level staff, and (v) office space, equipment and vehicles; (b) rehabilitation of sector operations through a lease contract between SONEG and SEEG; 3 (c) a rehabilitation program of existing facilities including the supply and installation of equipment for the plants, small diameter pipes, domestic connections, water meters; (d) the expansion of the Conakry system including the supply and installation of material and equipment for (i) partial doubling of the Grandes Chutes-Yessoulou-Conakry transmission line (about 60 km of 1,000 mm and 1,100 mm diamneter pipe); (ii) addition to the Yessoulou treatment plant of a 40,000 cu. m. /day unit; (iii) creation of about 5,000 cu. m./day of additional distribution storage capacity; (iv) extension of the water distribution network (about 300 km of 800 mm to 60 mm pipe and 15,000 new connections); and (v) services of an engineering consultant for the preparation of detailed designs, tender documents and construction supervision; and (e) consultant services for the preparation of UWS studies in secondary centers, and a re- training program for the former water company DEG's laid-off staff. 8. Further, a schedule for systematically raising water rates and eliminating domestic and foreign subsidies was agreed upon. This transparent scheme was clearly articulated in the SAR, and Credit covenants were designed to ensure satisfactory performance. 9. The project's goals were timely. The WSP-I experience had been instructive and incorporating the private sector in the next investment was an informed decision. The government's conclusion that physical and institutional objectives may not have been achieved without private sector participation and associated improvements in sector management was appropriate. Project components were explicit and designed after taking into consideration the best available information. An unmetered network and poor connection records prevented more precise rehabilitation and expansion targets. The implementation experience however leads to questions about whether the number of connections and the length of the distribution system were correctly balanced taking into account the population density. C. IMPLEMENTATION RECORD AND ACHIEVEMENT OF PROJECT OBJECTIVES 10. The main goal of creating a legal, institutional, technical, and financial framework that would constitute the basis for further development of the UWS was largely achieved. However, more improvement of the water network and commercial service are necessary to consolidate on the gains. Specific project objectives were achieved and most components were completed with some delays but within reasonable budget constraints. Credit covenants were also generally complied with. The following discussion indicates areas where there were departures from detailed objectives and components. 11. In an effort to ensure a good start for the institutional development process, the project was designed in such a manner that major steps of the institutional reform were taken before credit effectiveness. First the project preparation was extended until key stakeholders committed themselves to a process that would make this project the Bank's and Guinea's first privatization in the UWS. Once this consensus and commitment had been achieved, project preparation accelerated and the project size roughly doubled as other donors also agreed to contribute to this process. Next, conditions were imposed for credit negotiations and were met by early 1989. These conditions included creation of SONEG, appointment of the advisor to the General Manager of SONEG, finalization of legal documents related to the creation of SEEG, increase of water rates, and finalization of detailed designs 4 and cost estimates. Further, credit effectiveness was conditioned upon the execution of a subsidiary financing agreement between the Government and SONEG, selection of SONEG personnel, and payment of two trenches of initial capital by the foreign share holder. These conditions were also met by October 1989. 12. The government received bids from firms and teams interested in acting as the Foreign Investor Manager (FIM) participating in SEEG. Two French teams participated in the final bidding, both teams providing bids lower than the SAR's estimates. The winning bid was approxirnately 30% lower than estimates, indicating improved efficiency via low operating costs. SONEG and SEEG signed a ten- year lease agreement. 13. Once the credit became effective, SONEG and SEEG continued making progress. SONEG fully adopted the principle of a three-year rolling "contrat plan" and emerged as a much stronger institution than its predecessor DEG. The management promptly assumed its responsibility to borrow for sector investments, and to maintain assets. SONEG's capacity improved with regard to financial management, rate-setting and reporting. Water rates were increased as agreed, revenue generation was adequate, and the flow of counterpart funding was adequately maintained. SONEG's total revenues grew significantly, going from GNF 624 million in 1990 to GNF 6,026 million in 1995. Efficient accounting procedures and systems to efficiently monitor accounting and financial management were installed. Asset valuation by an independent expert was finalized on schedule, and a manual covering management, accounting, and internal control procedures was developed. While the internal audit function was initially unsatisfactory, the situation should improve with recruitment of a trained auditor in March 1997. The management decided not to use a legal adviser provided for by the project. 14. Procurement was initially delayed. However, SONEG was able to complete most physical components related to raw water transmission, treatment, storage, and treated water transmission less than two years behind the schedule projected in the SAR. Investments in the production and treatment facilities sector were started in 1992 and most of them were in operation by 1994. By September 1997, 25 urban centers had been equipped with piped systems. Water production capacity in Conakry grew from 45,000 m3/day in 1989 to 100,000 m3/day in 1997. A water treatment plant of 38,000 m3 was installed instead of a plant of 40,000 m3. However, at project closing, only 11,000 out of a projected 15,000 connections could be installed partly because the network was not long enough to reach so many additional customers. These connections will be completed by July 1998, almost two years behind schedule. 15. Since bids received for construction were lower than the SAR estimates, a one-year extension was negotiated with the Bank to use the savings to construct additional storage and to install an extra 109 km of distribution network. A treated water storage tank of 3,000 m3 was built instead of a tank of 1,000 m3; 384 km of network system was added instead of the proposed 275 km; and an office building with 960 m2 floor space was constructed instead of 600 mi2. 16. Private sector involvement resulted in improved day-to-day operations. SEEG moved quickly to rehabilitate commercial and financial systems. Billing was revamped and computerized in an impressively short time span of less than six months. A metering program was implemented and, though there were initial delays, by 1995 approximately 95% of water was sold through metered connections. Collection efficiency from private customers rose to a peak of 75% in 1990 but declined later and was 58% in 1996 because tariffs were raised progressively from GNF 150 per cubic meter in 5 1989 to GNF 880 (or GNF 440/m3 in 1989 GNF) per cubic meter in 1994. Corresponding revenues collected grew from GNF 1.8 billion in 1990 to GNF 10 billion in 1995 before declining to GNF 7 billion in 1996. The number of connections in Conakry grew from 12,000 in 1988 to over 23,000 in 1996 and corresponding coverage grew from 40% to approximately 60%. The staff of DEG who were not absorbed by SEEG and SONEG were offered training to create their own business in the private sector. Several staff successfully re-trained and now serve as sub-contractors to SEEG. 17. For its part, the Government approved tariff increases on time. Subsidies provided by the budget (support to SONEG's debt service) and under the IDA financing (payment of the foreign portion of SEEG remuneration) were progressively reduced and eliminated in 1995, as scheduled. The current consumer tariff level (GNF 880/m3 or GNF 440/m3 in 1989) necessary to cover inflated costs is higher than the 1988 level (GNF 60/m3) and also higher than the SAR projections (GNF 406/m3). The current remuneration is as follows: GNF 510/m3 for SEEG and GNF 370/m3 for SONEG. 18. Despite significant improvements in sector planning activities, the impressive record on completion of major construction components, and increased efficiencies in the day-to-day operations, unfinished business remains. 19. While SONEG's ability to conduct sector planning, and to manage investment and construction activities have improved over those of its predecessor, its record of monitoring SEEG's functions suggests a need for improvement. SEEG has been allowed to get away with a poor reporting record. Further, a 1996 audit indicates that tariffs are overvalued because of misapplication of SEEG's cost index. Weaknesses in this area could have a detrimental impact on the urban water sub-sector. In the absence of monitoring ability, SONEG is unable to assess the merit of requested rate increases and puts its own revenues in jeopardy. If prices are allowed to increase unreasonably, long-term sustainability will be threatened. 20. In complying with the project objective of setting water rates to meet long-term marginal cost, tariffs may have been raised too quickly, and consumers' ability to pay overlooked. While the number of connections and collection efficiency from private consumers increased impressively in early years, both indicators suffered later as tariffs rose. In spite of a social tariff of GNF 660/m3(GNF 330/ m3 in 1989 GNF), the number of customers declined from 1995 as they accumulated arrears then refused to re-connect when disconnected from the system. Collection efficiency has declined in the same period. Further, a consumer association (see Annex C) and a 1996 consumer survey indicate tariffs are too high. 21. While coverage has increased significantly, it is still limited. Only 60 percent of about 2.3 million people (of which 1.3 million live in Conakry) have access to water through house connections or standpipes. This suggests there is an unrealized potential in the system, and a significant number of additional customers can be served. 22. The present levels of physical losses of water are much higher than anticipated. At approximately 47%, these levels are not only too high in absolute terms but are higher than the levels (UFW of 35%) estimated at the start of the project and also higher than the SAR assumption of 20% UFW which was based on the experience of a similar water company in the C6te d'Lvoire. Physical losses increased significantly when new production came on-stream and the aged distribution system could not withstand the increased water pressure. At this time, SEEG had been maintaining the system for almost five years but by its limited actions to reduce physical losses, demonstrated that under the 6 existing lease contract, it saw no financial benefit from this investment. This high level of water losses will soon be a constraint to increasing coverage and will adversely affect SEEG's revenues. Unless corrected, this situation is an obstacle to achieving the system's full potential. D. MAJOR FACTORS AFFECTING THE PROJECT 23. The project encountered initial misunderstanding within the Bank at the preparation stage when disagreements between legal advisers and operations staff on the one side and operations staff on the other side almost resulted in abandonment. Initially the former group was cornvinced that the proposed procurement procedures being proposed by operations staff would violate existing Bank guidelines at this time and policies. Their concerns were overcome only after intensive and time consuming internal debate. Subsequently, not only were Bank procurement procedures revised but this innovative model of private sector participation was adapted for similar projects in other countries. The project was established under a main goal of improving sector operation and it was expected that a new institutional paradigm that included strong autonomous agencies and private sector participation would improve sector performance. This new paradigm created new sets of relationships and unforeseen challenges. While the resolution of these issues and challenges has sometimes been slow and problematic, over time, desired progress has largely been achieved. Further, systems have evolved to reduce the likelihood of major problems recurring. 24. The ten-year lease arrangement represents an innovative attempt to draw on the commercial strengths of the private sector. Under this contract, SEEG is responsible for operating and maintaining urban water facilities, for billing customers, and for collecting charges. The average water tariff is made up of the tarif exploilant and the redevance. The tarif exploitant covers SEEG's expenses and can be modified based on pre-agreed economic criteria. The redevance covers SONEG's operations, investment expenses, and related debt service. It is collected by SEEG and transferred to SONEG. 25. Both SEEG and SONEG encountered early personnel problems in their technical divisions and although these were satisfactorily resolved. The Government's interference and SEEG and SONEG conflicts jointly contributed to initial procurement delays. 26. Government arrears periodically brought financial transactions between SEEG, SONEG, and the State to a standstill. This was caused by a lack of cooperation by some government departments despite credit covenants to the contrary. Since SEEG was unable to disconnect recalcitrant consumers, it made up by withholding payments owed to SONEG. In retaliation, SONEG, delayed submitting withdrawal applications to the Bank for payment to SEEG. This problem was resolved in September 1996, when the Govemment, SEEG and SONEG proceeded to cross-compensation of their debts. Further, the Govemment moved to prevent recurrence by making special budgetary allocations in the departmental operating budgets and by empowering SEEG to disconnect recalcitrant departments. The situation has since improved considerably and SEEG has assurances of adequate recourse if bills are not paid. 27. SEEG's declared profits were limited, and no dividends were distributed to shareholders. Provisions for bad debts averaged roughly 18 percent of water sales revenues a year over the past five years, an exceedingly high ratio. These large provisions were mainly meant to cover Govemment arrears (GNF 3 billion in 1994), and late payments from private consumers. Government arrears have been largely cleared but dues from private customers remain a problem. 7 28. Since SEEG has functioned both as a system operator and as a construction contractor, and has not provided separate financial statements of its different functions, it is impossible to discem the risks and profitability of the lease operations. SEEG's activities as an operator require it to assume a commercial risk while its activities as construction contractor are performed on a cost plus basis. From the beginning of the lease contract, SEEG has persistently failed to provide SONEG with required reports and has thereby hampered transparency in operations and remuneration as well as SONEG's performance of its regulatory function. 29. Further, for several years, a professional drawn from the construction community managed SEEG. This period coincided with a greater focus by SEEG on construction projects, diminished commercial efficiency, and poor relations with SONEG. The situation improved when a professional with an operational background was brought in as a replacement. 30. SONEG experienced losses until 1991 but has been profitable since then. Numerous delays in receiving payments from SEEG directly affected SONEG's provision for bad debt. The significant increase in sectorl investment also contributed to raising the level of depreciation. SONEG's financial results would have been better had SEEG's efficiency in customer management improved and the proposed yearly tariff increases been effective in January. 31. The project resulted in elimination of over billing of the Government client and to a decentralization of payment responsibilities. Until 1990, Govemment billing was based on a lump sum structure and was grossly overvalued. This structure was replaced by a metered billing structure that immediately led to lower government billing. As a result, Government consumption has changed drastically from an estimated 7.5 million cubic meters to about 5.4 million cubic meters in 1993. In 1995, the Government implemented two measures to further reduce its water bill and improve its payment ratio. It established a list of services to be paid for by the Government, and transferred public standpipe water bills to local communities. This has helped improve collection from these communities. 32. The experience with water losses has also been instructive. In 1989, UFW was estimated to be 35%. However, this estimate was derived when large portions of the distribution system were unmetered. Once project implementation began, the network was found to be in worse than anticipated condition. As the water pressure increased with the completion of construction, water losses increased. By this time, almost five years of the ten-year lease contract had elapsed, and with each passing year the incentive for SEEG to invest finance on rehabilitation works which would yield benefits in future years diminished. Consequently, SEEG did not further reduce water losses. E. PROJECT SUSTAINABILITY 33. The sector reorganization has had a strong positive impact on the urban water development sub-sector. Developments in both the key sector organizations SONEG and SEEG have contributed significantly to the strengthening of the sector. SEEG developed the ability to address technical, financial, and managerial issues it faced. Similarly, SONEG developed adequate managerial and technical skills to be able to autonomously plan and implement sector development programs. The experience these organizations have gained in their new roles has resulted in enhanced institutional maturity and indicates that significant strides have been made towards achieving sustainability. 8 34. With the support of the World Bank, the Government, SONEG, and SEEG are moving to consolidate the gains made in the Second Water Project through the ongoing Third Water Supply & Sanitation Project in which Bank support is US $16.8 million. This project includes components to improve the distribution system, strengthen SONEG's monitoring capacity, and to assist SONEG prepare and negotiate a new lease contract that will comprise a performance contract between SONEG and SEEG. It will also address UFW, tariffs issues, as well as institutional incentives for better performance. Overall, sustainability is rated as likely. F. BANK PERFORMANCE 35. Bank performance was highly satisfactory in project preparation and satisfactory in the project implementation. The Bank staff addressed effectively the failings of the WSP-I during identification. During project preparation and appraisal, the Bank's operational staff did well to design an innovative sector reorganization plan that would have far reaching beneficial impacts At the same time disagreements among operational, procurement, and legal staff led to a delay in Bank commitment for the project. Conditions imposed on the borrower allowed for the establishment of a sound institutional framework before credit effectiveness. During supervision, the Bank staff identified implementation problems and moved adequately to address them. For example, when SEEG delayed installing meters on Government connections, the meters were quickly installed on the Bank's insistence on their timely installation. When the relationship between SEEG and SONEG reached a low, the Bank took the positive step of calling for discussions to resolve the differences. Finally, when the Government failed to pay dues in a timely manner, this situation was satisfactorily resolved with. the assistance of the Bank. G. BORROWER PERFORMANCE 36. Borrower performance was highly satisfactory during the project preparation and satisfactory during the project implementation. Project objectives were achieved because all parties, the Government, SONEG, as well as SEEG, played vastly improved roles. SEEG significantly improved the commercial systems. SONEG developed and implemented sector programs expeditiously, The Government, to a large part, facilitated the operation of the sector organizations and paid its bills. While problems were encountered in procurement, pricing, and with UFW, performance has improved very significantly from the weak beginnings observed in the WSP-I. However, opportunities for designing an incentive structure that would prevent economically wasteful water losses and increase coverage rapidly were missed. H. ASSESSMENT OF OUTCOME 37. Project objectives were largely achieved and the organization for consumer protection reports satisfaction with delivery and water quality. While there were several shortcomings such as procurement delays, incomplete development of SONEG, and problems with managing SEEG, sector operations in Guinea have improved very significantly over the performance displayed by the previous organization. The outcome is rated as satisfactory. 9 I. FUTURE OPERATIONS 38. The Government, SONEG, and SEEG are very committed to consolidate on the gains made so far in urban water sector and this, with the support of the world Bank. The Third Water Supply & Sanitation Project (WSP-I) which was made effective in August 1997 has allocated US$ 16.8 million for addressing the shortcomings of the WSP-Il and will enhance the distribution system in Conakry, strengthen SONEG's regulatory capacity, and assist in the preparation and negotiation of a new lease contract. 39. The Government has submitted an action plan for the water sector improvements. According to this action plan, the most immediate needs in the water supply and sanitation sector are the rehabilitation of existing systems and associated improvements in operation and maintenance. Rehabilitation will be followed by carefully planned expansion of existing systems to serve to a rapidly increasing population. 40. The sector's performance will continue to depend on the pace at which SEEG reduces UFW and on the lease contract through the incorporation of monitoring indicators that will be renegotiated in 1999. The Government has also submitted a timetable to review SONEG and SEEG's remuneration. and plans to seek the advice of consultants who will help review the incentive structures existing under the lease contract. 41. SONEG's objectives are also to develop water services in thirty-three secondary urban centers by the year 2005 and to increase access to safe water to meet urban household demand, particularly in Conakry's fast-growing low-income areas. The Government and SONEG's objectives and commitments would be part of the revised three-year rolling enterprise contract. SONEG's strategy will be to manage water demand more effectively by instituting an appropriate tariff policy, and to develop an improved incentive structure that will maximize the efficiency of SEEG's water operations. Tariffs will be adjusted to reflect actual costs taking into account the capacity for the consumer to pay through a program of social connections for the poor. J. KEY LESSONS LEARNED 42. This project represents the Bank's first experience at using private sector participation as a major tool for reshaping the institutional structure in a borrowing country's water sector. The privatization approach was very different from the traditional Bank loans in the sector. Partly because the approach was so new to the bank, there was significant debate over whether then existing legal and procurement procedures allowed the Bank to fund a project where the private sector would be responsible for managing day-to-day operations. The lengthy internal discussion process contributed to the long preparation period of four years. 43. These discussions benefited the Bank by contributing towards the evolution of more friendly private sector participation procedures and allowing innovation which is built on sound principles to take place. Further, this project's approach also served as a model for subsequent sector investments. 44. The project also had a noteworthy achievements. In implementing the sector reform, a major portion of the new institutional structure was put in place as a condition of loan effectiveness. Also, the project supported and financed a transparent subsidy scheme designed to remunerate the private sector 10 providers at the agreed upon lease rate and at the same time protect consumers from a rate shock by gradually increasing consumer prices over several years. 45. The following lessons were learned from this project: * The sector reorganization that entailed establishment of autonomous agencies and private sector participation served to significantly improve sector performance. * However, universal improvements in efficiency should not be taken for granted even in a privately operated system. * When a lease contract is being designed, short-term and long-term incentive structures should be carefully created to meet precisely articulated objectives to maximize the efficiency of the private sector operations. * In the interest of the consumer protection, a strong regulatory and oversight function is very important to control private sector operations. * To increase transparency in operations when a private operator functions as a system operator and as a construction contractor, separate financial statements of its different functions are highly recommended. 11 REPUBLIC OF GUINEA SECOND WATER SUPPLY PROJECT [Credit 1985-GUIl IMPLEMENTATION COMPLETION REPORT Part II. TABLES TABLE 1 - SUMMARY OF ASSESSMENTS A. Achievement of Objectives Substantial Partial Negligible Not applicable V^) (a) V^) (V) Macro policies El El Fl El Sector policies 2E1 0 0 Financial objectives El E ElI Institutional development El 0II [I0 Physical objectives El El El Poverty reduction El El E Gender issues El El E Other social objectives El El E E Environmental objectives El El El Public sector management El El El Private sector development D L D Other (capacity building) [Z] El El El 12 B. Project Sustainability Likely Unlikely Uncertain (1) ('1) (I) C. Bank performance Hjighy satisfactor Satisfactorv Deficient (1) (1) (1) Identification E5il LI 0i Preparation assistance m Ci L Appraisal Li Li° Supervision Li L-i D. Borrower performance Highly satisfactorv Satisfactorv Deficient (1) (1) (1) Preparation [I] 0i °i Implementation Li L7i LII Covenant compliance (counterpart funds) K] K Operation (if applicable) Li Li E. Assessment of Outcome Highly Highly satisfactory Satisfactory Unsatisfactory unsatisfactory (L) L i ) V ) O m7 E- CH 13 TABLE 2- RELATED BANK LOANS/CREDITS Precedini Operations First Water Supply and Sanitation Rehabilitate the water production and 1985 Completed Project (Cr. 870-GUI) transmission facilities; extend the water distribution network and provide technical assistance to the water supply company. Conakry Urban Development Strengthen the ability of central and local 1984 Completed Project (Cr. 1466-GUI) government to plan coordinate, and control urban growth and development in Conakry and the surrounding area. Nat. Rural Infrastructure Ensure rural water supply for 140 villages 1990 Completed (Cr. 2106-GUI) where more thank 100,000 people live in Kissidougou and Gueckedou regions Followina onerations Third Water Supply and Increase coverage and access to safe water 1997 Under Sanitation Project (Cr. 017 -GUI) sufficiently to meet urban household demand; Supervision development of sanitation service in Conakry; improve regulatory capacity and human resources of institutions responsible for water and sanitation TABLE 3- PROJECT TIMETABLE $teps in projecT ~Ie Date pDatactl............ Identification (Initiating Project Brief) July 9, 1984 Preparation 1985 - June 1987 Pre-Appraisal February 1988 Appraisal May 1985 March 1988 Negotiations October 1988 Board Presentation May 1988 February 21, 1989 Signing May 3, 1989 Effectiveness Subject to Borrower Meeting Several Conditions October 5, 1989 Project Completion October 31, 1996 July 31, 1998 Loan Closing October 31, 1996 October 31, 1997 14 TABLE 4 - LOAN/CREDIT DISBURSEMENTS (TJS$ millions) Appraisal estimate 2.4 4.8 7.2 9.2 8.0 5.2 2.8 0.4 0 Actual 2.91 5.15 4.58 9.64 6.22 3.98 3.94 3.23 .78 Actual as % of estimate 121% 107% 64% 105% 78% 77% 141% 808% Appraisal estimate 2.4 7.2 14.4 23.6 31.6 36.8 39.6 40.0 40.0 cumulative Actual cumulative 2.91 8 06 12.64 22.28 28.50 32.48 36.42 39.65 41 Actual as % of est. 121% 112% 88% 94% 90% 88% 92% 99% 102% cumulative = The last of disbursement of SDR 6,300 (equivalent to US $ 8,700) was made on 11/19/1997. Cumulative Disbursements: Estimated and Actual US $ Millions 45 40 35 Estimated 30 25 Actual 20 1 5 1 0 5 1 2 3 4 5 6 7 8 9 Fiscal Year 15 TABLE 5: KEY INDICATORS FOR PROJECT IMPLEMENTATION Items Estimated.Ahevmn A. Man gement Support Program to SONEG 1. Technical Assistance l.a Advisor to General Manager 72 person months Completed Lb Engineer 72 person months 75 person months 2. Consultancy Services 2.a Rate Consultant 6 person months Completed 2.b Legal Counsel 6 person months Not Used 3. Audit 50 person months Completed 4. Training 9 person months Completed 5. Office Space 600 m2 960 m2 6. Equipment and Vehicles 6a. Office Fum. & Equipment. Various Completed 6b. Vehicles 2 2 B. Rehabilitation of Sector Operations 7. ] Creation of SEEG Achieved 8. Conclusion of Lease Contract_ Achieved C. Rehabilitation of Existing Facilities 9. lSupply of Equipment etc. Various Achieved 10. hInstallationof equipment etc. Various Achieved D. Expansion of Conakry of Water Supply 11. Raw water transmission line 36 kin, 1,000 mm pipe Installed 12. Treatment plant ( & Storage) 40,000 m3/day (1,000 m3) 38,000 m3/day (3,000 m3') 13. Transmission line 24 kin, 1,100 mm pipe Installed 14. Connections with storage 14.a Regulation valve chamber Installed 14.b Pipe laying 11.2 km Installed 15. Storage Reservoirs 15.a Kipe storage 2,500 m3 Installed 15.b Simbaya storage 2,500 m3 Installed 16. Distribution Network 16.a Primary 23 km Installed 16.b Secondary 275 km 383 km 16.c Connections 15,000 11,200 17 Engineering consultant 160 person months 193 person months E. Cons ultancy Services 18. Preparatory studies | Completed 19. Revision of legal framework Completed 20. Tech. assistance to Govt. Completed 21. Secondary centers study Completed 22. Outplacement Completed 16 TABLE 6: KEY INDICATORS FOR PROJECT OPERATIONS 19909 - 1991 1992 J- 1993 1 1994 - 19 95 1 1996: 19971 Est. Act Est. I Act Est. - Act -Est. Act Est. Act Actual Actual Actual.. Production (Mm3) 19.9 20.5 20.5 21.5 22.0 21.7 23.7 26.5 33.6 26.8 24.9 Aggoregate Billing (Mm3) 13.3 14.1 14.3 10.8 15.4 11.6 17.1 13.0 15 7 14.1 12.9 Collection (NfinM) 9.6 10.6 10.7 7.1 11.9 9.6 13.7 9.2 13.8 12.7 11.9 Coll. Eff. (%) 72 88 75 44 77 39 80 35 84 84 64 Billing (GNF 106 2.1 2.9 | 4.8 |_ |_ 6.7 | | 12.5 | 11.9 10.9 | Collect. (GNF 10 ) 1.8 1.3 1.9 2.8 10.5 10.0 701 Coll. Eff. (%) 88 44 _ 39 _ _ 42 _ j 84 84 64 Govern. Conn. Billing(GNF 106) 1.1|[ 1.1 1.9 3.1 6 4.4 3.3 2.3 Collect. (GNF 10') _ T 1ll T8_ 5 8 1 _ .4 T_ r 6.2 5.41 2.5 1.5 ICol Eff. (%) 1100 T 1 44 ___ 41 ___ 13 T_ 1 104 1221 77 64 Private Conn. Billing (GNF 106) | .9 |_ |_ 1.8 |___ 2.9 |___ 3.6 |_ | 6.5 7.5 7.6 5.7 Collect. (GNF 106) | _ .7 ____ .8 ____ 1.1 2.4 _ _ 4.3 4.7 4.4 2.6 Coll. Eff. (%) 72 44 |_ |_ 38 67 _ | 66 62 58 45 Tariff (GNFIm 150 150 239 320 274 465 356 680 520 880 880 880 880 Tariff (USD/m) m 0.25 0.22 0.38 1 0.39 0.42 0.50 0.52 1 0.71 0.73 0.88 0.88 0.88_ Metered Cons. -Public Conn. (%) J |_ 100 45 100 36 100 60 100 86 100 I 100 -PrivateConn.(%) __ | 43 100 58 100 67 100 81 100 91 98 98 j Conn. Billed (000) I _ 17.1 _ _ 20.3 __ l_18.6 _ _ 19.5 _ _ 20.1 21.3 23.4 Staffing f SONEG Total 43 45 __ |_ 45 |_ |_ 44 45 42 43 44 Expatriates 2 2 _ 2 T 1 2 T T 2 Guinea Nationals T_ T_ 41 43 43 __ T_ 42 T T 43 42 43 44 SEEG Total ____312 ____ 294 _ _ 292 _ _ 291 _ _ 448 450 503 503 Expatriates 8 8 81 8 6 6 5 5 S Guinea Nationals 304 _ _ 286 ____ 284 1 283 442 444 498 1 498 Sector Total 355 339 337 335 493T 492 546 547 1. Indicators for 1997 reflect a partial year 17 TABLE 7: STUDIES INCLUDED IN PROJECT 1. Preparatory Study to the To help prepare the Completed Study recommendations were Project project adopted 2. Secondary Centers To help rehabilitate Completed Secondary center Water Supply Studies secondary centers rehabilitation commenced. TABLE 8A - PROJECT COSTS (US$ Millions) Management Support 0.6 3.6 4.2 0.2 3.9 4.1 l Program to SONEGl Rehabilitation of Sector 1.3 14.1 15.4 0.0 16.9 16.9 l OperationsI Rehabilitation of Existing 0.4 3.7 4.1 1.4 7.6 9.0 l Facilitiesl Expansion of the Conakry 9.3 48.6 57.9 11.4 73.5 84.9 l f ~~~~Water Supply Consultancy Services 0.1 1.1 1.2 0.2 2.9 3.1 Base Cost of Mid-1998 11.7 71.0 82.7l Physical Contingencies 1.5 7.8 9.3l Price Contingencies 1.6 9.0 10.6l Total Project Cost 14.8 87.8 102.6i 13.2 104.8 118.0| i~ ~~~~...... ............. 18 TABLE 8B: PROJECT FINANCING (US$ Millions) IDA 2.9 37.1 40.0 4.4 36.6 41.0 AfDB 3.1 19.9 23.0 1.2 22.4 23.6 CCCE 1.9 14.7 16.6 2.0 21.1 23.1 EIB 1.9 9.4 11.3 0.0 16.0 16.0 Private Sector --- 1.4 1.4 0.4 1.0 1.4 Government & SONEG 3.3 5.3 8.6 4.2 1.9 6.1 Beneficiaries 1.7 --- 1.7 1.0 1.0 JICA 0.0 5.8 5.8 TOTAL: 14.8 87.8 102.6 118.0 TABLE 9 - ECONOMIC COSTS AND BENEFITS a:.,,.... X q .;'' ~~~~....... ... || Internal Rate of Return | 11% | 10% l... 19 TABLE 10 - STATUS OF LEGAL COVENANTS Credit 2.06 C 10/31/97 SONEG to submit draft annual operating and capital budgets, financial forecasts, training program, and Contrat Plan Credit 2.07 C 12/31/89 SONEG to submit new accounting procedures Satisfactory Credit 2.08 C 12/31/89 SONEG to limit staff to 60 employees Limited to peak of 45 Credit 2.09 C SONEG to cause SEEG to prepare a rehabilitation Submitted to IDA program Credit 2.10 CD SONEG to cause SEEG to report periodically on operating and financial performance Credit 4.01(bXii) CD 8/31/97 SONEG to submit audited financial.statements Credit 4.01(bXiii) C 9/30/97 SONEG to furnish audited statements of water billed & collected, special accounts, and of SOE every 4 months Credit 4.02(a)(i) C SONEG to maintain single rate until one year after installation of meters on all connections Credit 4.02(a) C Thereafter, SONEG to maintain lowest rate applicable at not less than 1.2 times consolidated operating costs Credit 4.03 C SONEG to request IDA opinion on investments costing more than US$ I million Credit 4.04(a) C SONEG's annual debt service not to exceed annual net revenues Credit 4.05 C SONEG to carry out annual pro forma asset revaluation Credit 4.06 C SONEG to generate agreed rate of return on revalued assets Credit 3.01 (a) C Government to make proceeds of Credit available to Complied 8189 SONEG as grant and partly under subsidiary financing agreement Credit 3.01(d) C Government to approve water rate increases Credit 3.04 CD Government to enter into Contrat Plan with SONEG Credit 3.05(d) CP Borrower to settle Govemrnment water bills in 4 installments Credit 3.06 C Government to request IDA opinion on investments costing more than US$ I million Credit 3.07(a) C 1/5/90 DEG to cease all operations in Conakry 8/1/90 Credit 3.07(b) CD 12/31/89 Completion of DEG liquidation Completed 11/90 Credit 4.01(f) C 6/30/90 Financing for expansion of Conakry system to be effective Status Codes: C-complied, CD-Compliance after delay, CP-Partial comnpliance 20 TABLE 11 - ESTIMATED BANK RESOURCES: STAFF INPUTS W~~~~ ~~.'. .. ......... Through Appraisal 51.7 124.9l Appraisal-Board 59. 1 148.7 Board-Effectiveness 6.1 15 .7l Supervision 140.6 440.9l Completion 10.5 31.3| Total 268.0 716.5 21 TABLE 12 - BANK RESOURCES: MISSIONS Identification Preparation 12/85 2 12 EN, FA Preparation 3/86 1 7 FA Preparation 7/86 3 11 EN, FA, CON Preparation 2/87 3 8 EN, FA, CON Preparation 6/87 2 11 EN, FA Appraisal 3/88 4 22 EN,FA,EC,CP Supervision 10/89 2 15 FA, EN I I PP Supervision 5/90 1 7 EN I 1 PP Supervision 10/90 1 11 EN 2 1 PP, PMP, TA Supervision 1/91 1 8 FA 2 1 PP,TA Supervision 7/91 1 5 FA 2 1 PP, PMP, TA, CC Supervision 6/92 2 9 FA, EN 2 1 PMP, AF, PP, TA, FP Supervision 10/92 1 6 EN 2 1 CC, AF, PP, TA, FP Supervision 1/93 2 5 FA, EN I I CC,TA Supervision 6/93 1 10 EN 2 1 CC,PP,TA,FP Supervision 3/94 1 6 EN 2 1 CC, PP, PP, TA, FP Supervision 7/94 1 FA S S CC, PP, PP, TA, FP Supervision 10/94 3 10 EN, FA, OP S S CC, PMP. AF, PP, TA, FP Supervision 2/95 2 20 EN, FA S S CC, PMP,AF, PP, TA, FP Supervision 7/95 5 4 EN,FA, OP,EN S S CC, PMP, AF, PP, TA, FP Supervision 11/95 1 5 EN HS S CC,PMP,AF,TA,FP Supervision 4/96 1 5 EN HS S CC, TA Supervision 9/96 1 8 EN HS S CC, TA, FP Supervision 6/97 3 10 EN s s PMP Last Mission 10/97 1 7 EN S S Staff SkMls Perfonnance Ratings Types of Problens AR - Architect OP Operations Officer 1 - Minor or No Problems AF: Availability of Funds PMP: Project Managernent CON - Consultant PO - Project Officer 2 - Moderate Problems CC: Compliance with Performance EC -Economist TTL - Task Team Leader 3 - Major Problem Legal Covenants PP: Procurement Progress EN Engineer CP - Commnunity S Satisfactory FP: Financial Performance PS: Progress of Studies FA - Financial Analyst Participation Specialist HS Highly Satisfactory PDO: Project TA. Technical Assistance OA - Operation Assistant Development Objectives Progress 22 Annex A Mission's Aide-Memoire REPUBLIC OF GUINEA SONEG (NATIONAL WATER ENTERPRISE OF GUINEA) SECOND WATER SUPPLY PROJECT (Credit No. 1985-GUI) FINAL SUPERVISION MISSION AIDE-MEMOIRE 1. Mr. Yao Badjo visited Conakry from October 17 to 25, 1997, in order to carry out the World Bank's final supervision mission and prepare closure of the Second Water Supply Project (Credit No. 1985-GUI), and supervise the Third Water Supply and Sanitation Project. The present Aide-Memoire refers only to the Second Water Supply Project. 2. The mission was received by His Excellency Alfa Ousmane Diallo, Minister of Urban Planning and Housing. The mission visited Mr. Fontaine and Mr. De Geyer, of Caisse Frangaise de Developpement, in order to gather this agency's opinions regarding project implementation. The nission also held working sessions with the Office of the Director General of SONEG, and visited the Director General of SEEG. The mission wishes to thank all of the above, particularly SONEG, for their welcome and cooperativeness. 3. As of September 30, 1997, the overall results of the project, including all components of financing, were as follows: * An additional 55,000 m3 of water production capacity in Conakry; * construction of an additional 11,250 m3 of water storage capacity; * construction of 416 km of water supply system; * 11,000 new connections installed; * rehabilitation of the groundwater pumping stations in Conakry; * partial rehabilitation of the Conakry water supply system and connections; * rehabilitation of three water catchments in Kakoulima; * rehabilitation of water supply facilities in three secondary centers; and * construction of the SONEG headquarters. 4. This Aide-Memoire summarizes the mission's main conclusions and recommendations, examining the following issues: * Project financing * Project objectives and main components * Implementation 23 * Project impact * Sustainability e Risks Project Financing 5. The Second Water Supply Project (Conakry) began to be implemented in 1989, and was jointly financed by the following donors: IDA (the International Development Association), EIIB (the European Investment Bank), CFD (Caisse Frangaise de Developpement), the African Development Bank Group (AfDB, NTF, and ADF), SONEG (the Guinean national water authority), the Government of the Republic of Guinea, and the private-sector partners in SEEG (the Guinean water management company). The breakdown of financing was as follows: IDA Credit No. 1985-GUI (SDR 29.30 million, approved on May 3, 1989), EIB Loan No. 70,795 (ECU 6 million, signed on October 27, 1989), a Second EEB Loan (No. 70,860 for ECU 8 million, signed on December 17, 1991), CFD Loan No. 982 300 91050 (F 125 million, signed on July 4, 1991), together with the following loans issued on June 21, 1989: AfDB No. B/GUI/AEP/89/11 (UA 6.22 million), NTT No. GUI/AEP/89/2 (UA 6 million), and ADF No. F/GUIWAEP/89/1 1 (UA 4.61 million). Project Objectives and Main Components 6. Project objectives: The main objective of the project was to establish a legal, technical, and financial framework that would serve as a basis for the development of the urban water supply sector. The project had the following aims: (a) Strengthening the planning and management capability of the agency responsible for developing the sector (SONEG, the national water authority); (b) rehabilitating technical, commercial, and financial operations in the sector, in accordance with the terms of an operating contract between SONEG and SEEG, the Guinean water- management company (owned jointly by the Government and a foreign partner); (c) strengthening the Conakry water supply system (which had reached its limit), a secondary objective being to generate additional revenue as support for the development of the less profitable systems in smaller urban centers; and (d) regularly increasing water rates to meet long-term marginal costs. 7. Project components: As planned, the project comprised the following components: (a) A management-support program for SONEG, consisting of: (i) technical assistance for the Directorate of Studies and New Works; (ii) the services of a financial consultant; (iii) audits; (iv) a staff training program; (v) the construction of offices and the supply of equipment and vehicles. (b) Support for the foreign-exchange component of the operative water rate, provided over a six- year period at a decreasing percentage (100% for the first four years, 80% for the fifth year, and 60% for the sixth year). 24 (c) A program for the rehabilitation of facilities, including the supply and installation of equipment for existing pumping stations, small-gauge pipes, individual connections, and water meters. (d) Expansion of the Co'nakry water supply system, including the supply and installation of the equipment necessary for: (i) partial doubling of the Grandes Chutes-Yessoulou transmission line (about 60 km of pipes, 1,000 mm and 1,100 mm in diameter); (ii) addiition of a 40,000 m3 unit to the Yessoulou treatment plant; (iii) provision of an additional 5,000 m3 in storage capacity; (iv) extension of the water distribution network (307 km of 8010/60-mm pipes and 15,000 new connections); (v) provision of the services of an engineering consultant for the preparation of detailed designs and bidding documents, and for the supervision of the works. (e) Consultant services for preparing studies on urban water supply in secondary centers, and a training program for staff laid off by DEG and wishing to establish their own enterprises. Project Implementation 8. Overall implementation began with the provision of assistance for SONEG in January 1989. The new agencies established once the sector had been restructured (SONEG and SEEG) came into operation on August 1, 1989. As regards physical components, the rehabilitation program began in July 1990 and the new works in January 1992. Despite an accumulation of delays at the beginning of the project, affecting the prequalification of enterprises and procurement for iitems 1 through 5, execution of the works was satisfactory, thanks in particular to the quality of the engineering consultant's supervision and monitoring. 9. No particular problems affected the management of the IDA-financed contracts, except in the case of the rehabilitation contracts for items 7 and 8 (executed by SEEG and supervised by SONEG), where there was an overrun of about GNF 400 million, leading to a rejection of applications for disbursement on the part of IDA. Subsequently, these ovenruns were absorbed by SEEG's revolving fund. Counterpart funding was mainly important in item 1, financed by AEDB, and item 6C (distribution), together with a portion of the costs of the planned 15,000 connections. To avoid delaying the works, SONEG prefinanced the Government's counterpart funds for item 1. 10. SONEG properly fulfilled its responsibilities as project owner. Nevertheless, capital investment planning in the sector must be improved. To a considerable extent, the selection of certain investment items and technical approaches, and the criteria applied when determining the scale of installations and designing projects, are decided by the donors, especially when financing takes the form of a grant. In Conakry, the designs used in projects other than those forming part of this Second Project take no account of the rest of the system. To overcome this problem, a master plan has been prepared for the water supply system in Conakry (with project financing) and 10 secondary centers (with financing from CIDA, Canada). 11. Implementation of physical components: The following results have been achieved: Daily water production capacity has reached 100,000 m3, compared with 45,000 m3 before the project. 25 * km of pipes were installed (all diameters), compared with the planned 307 km. Conakry now has a 700 km system, compared with 260 km before the project. * connections and 35 standpipes were installed. * Conakry's storage capacity was increased from 19,000 m3 to 35,200 m3. * The Conakry groundwater stations were rehabilitated. * Three catchments were rehabilitated in Kakoulima, providing an additional daily flow of 3,000 m3. * In Conakry, the water supply system, 13,000 connections, and 55 standpipes were rehabilitated. * In Faranah, Forecariah, and Gueckedou, the water supply facilities were rehabilitated. * The SONEG headquarters was constructed. 12. Despite the successful outcome of the physical components, the following two problems remain, and call for immediate action: (a) the poor performance of the water supply network (losses amount to 50%); (b) SEEG's poor commercial performance (at about 66%, the average recovery rate from private consumers is still low). 13. Staff training: The training program was based on the following two main components: * Training sessions were organized in Guinea and Europe by Office International de l'Eau Potable (France). * Special short courses were organized for the technical staff assigned to supervising and monitoring the work sites. 14. In order to provide SONEG engineers with practical training, one would be assigned to the consultant in each batch of works, so as to observe how these works were supervised and how assistance was provided for the contractors in the administrative procedures necessary for performing their contractual duties. Project Impact 15. Annexes I and II show comparisons between the targets planned at Appraisal and actual performance, according to the main operating indicators for the sector. Undeniably, project implementation was a success in terms of the physical components and control of capital investment costs. The project made a major contribution toward upgrading water supply services, and this led to definite improvements in the health of the population of Conakry, which now has a clean water supply, both day and night. Nevertheless, the project did not achieve all the performance targets set at Appraisal, such as those relating to the Conakry water supply system, water sales, and recovery ratios, all of which fall short of the planned levels. Performance of the Contrat-Plan (SONEG) 16. SONEG fully adopted the principle of a rolling three-year contrat-plan that would be updated each year, and prepared on time all the necessary documentation for the annual plans (i.e. that relating to the contrat-plan itself, the capital investment programs, and the multiyear projections). Nevertheless, approval and signature of the contrat-plans were delayed. In spite of these delays in 26 issuing approval, the Government fulfilled its commitments to increase water rates. The current average rate (GNF 880 per mi3) is at the level indicated in the Appraisal Report. SONEG is up-to-date with its share of the sector's debt-service payments, the amounts being as follows: GNF 136 million in 1991, GNF 376 million in 1992, GNF 1.64 billion in 1993, GNF 2.517 billion in 1994, GNF 4.426 billion in 1995, GNF 3.067 billion in 1996, and GNF 1.18 billion at end-July 1997. The weakness in the contrat-plan and other institutional arrangements is the Government's failure to pay its water bills on time. Performance of the Operating Contract (SEEG) 17. The weaknesses in contract performance were the result in particular of the system adopted for rehabilitation. SEEG's apparent failure to understand IDA procedures and its insistence on using negotiated contracts for rehabilitation works had the effect of slowing the whole process down. It was clear that SEEG's normal commercial practices for providing supplies for partners resulted in better prices than IDA procedures would have done, at least in the case of medium-cost orders; however, negotiated contracts provided no advantages for rehabilitation works. On some other occasion, it would be useful to test the possible inclusion of components of a rehabilitation program in the bidding process for an operating contract. Another problem is that SEEG does not provide all the information required under the terms of its contract (progress reports, technical reports, etc.). It is most desirable that there should be increased transparency regarding performance of the operating contract. Operator's Performance (SEEG) 18. Annexes I and II show performance indicators for operations, together with the levels planned at Appraisal. The following are the main features of these indicators: (a) The volume of actual sales is smaller than planned. This can be attributed partly to the delay in bringing the transmission line into operation, but mostly to the small increase in the number of connections. (b) The level of performance was considerably lower than planned. Weaknesses in operations became clear when the new transmission line came into service. This falloff could have been foreseen and SEEG had five years to prepare for it. The results are unsatisfactory. (c) Collection ratios were lower than planned; however, a comparison with the situation prior to the privatization of operations shows that the sector's financial position has clearly improved. Sustainability 19. Essentially, the sustainability of reforms in Guinean urban water supply will depend on the following factors: * The Government's will to maintain the reforms and build on them. In the mission's opinion, there is no danger that this will not be so, because the reforms have already transformed the financial position of urban water supply and created a real potential for development. In addition, the service quality of water supply has greatly improved. * Rapid improvements by SEEG in the performance of the Conakry water supply system, and improvements in the quality of its commercial services with respect to billing and 27 recovery. The mission believes that improving SEEG's performance should be the agency's basic priority. The use of incentives could be considered, such as the introduction of a charge for the use of raw water. Risks 20. The first risk arises from the small volume of sales resulting from the limited number of connections, while the second is produced by the lack of any provision for upgrading the system over the coming two years, since this could bring about a totally unnecessary water shortage, due solely to wastage through water losses. The third risk is that water consumption by the Government and private consumers will not be paid for in a timely manner, and this could damage the sector's financial position. The first risk can be lessened by continuing and intensifying the program of low-cost connections. This should be extended, making the costs affordable to consumers. In addition, the price structure for water should be reviewed, and a range of "social prices" should be introduced. The second risk will be reduced by the rapid application of an action plan proposed by SEEG and SONEG for improving the Conakry water supply system. As regards the third risk, the Ministry of Finance has promised to introduce effective mechanisms for the payment of government water consumption. In addition, SEEG should establish a better commercial policy so as to improve the recovery rate for its private customers, which is currently low even when compared with the rate of payments obtained from the Govemment, even though the latter is still SEEG's best paying customer. Conakry, October 25, 1997 Yao Badjo World Bank 28 Annex B Borrower's Evaluation of the Project COMPLETION REPORT CITY OF CONAKRY: SECOND WATER SUPPLY PROJECT RESULTS 1. By the end of the project, the physical components had achieved the following results: * The design capacity of the water supply system in the city of Conakry had increased from 45,000 m3 per day in 1988 to 100,000 m3, including an additional 3,000-m3 flow per day resulting from the rehabilitation of three catchments on the slopes of M[ount Kakoulima. * The urban water-distribution system in Conakry was extended from 260 km (before project) to 700 km through the construction of an additional section 416 km long, instead of the 307 km planned at Appraisal. * The 11,000 new connections provided by the Second Water Supply Project, together with those installed by SEEG independently of the project, brought the total number of private connections in Conakry to 25,000. * Total storage capacity increased from 19,000 m3 in 1988 to 35,250 m3 in 1996. * Thirty-five standpipes were installed, and 55 others were rehabilitated. * Older sections of the distribution system -- together with 13,000 defective and out-of-order private connections -- were rehabilitated. * In Forecariah, Faranah, and Gueckedou, water supply facilities were rehabilitated. * The SONEG headquarters was constructed and equipped. * On the other hand, the performance of the Conakry water supply netwvork continues to be poor (at about 50%), as does the billing recovery rate (at about 66%). * By June 1997, 20 urban centers, including Conakry, possessed water supply systems. * In 1998, the number will increase to 25, once works have been completed in Labe, Siguiri, Dinguiraye, Koundara, and Teliml&. * The new works installed under the project, together with improved technical and financial management, are providing an uninterrupted supply of water -- at a satisfactory operating pressure -- for Conakry and the other centers. More than 90% of the connections are fitted with meters. 3 * IDA support for water pricing ended in 1995, and the current rate is GNF 880 per m3, compared to GNF 150 per m3 in 1990. There are the following three levels: 0-20 m3: GNF 680 21-60 m3: GNF 850 61 m3 and above: GNF 925 2. The financial performance was as follows: 29 * SONEG regularly submitted its own and SEEG's financial statements to IDA, applying the monitoring standards agreed with IDA. It has also forwarded to IDA the audit reports referring to the various accounts, together with audited statements of the volume of water billed and the charges recovered. * SONEG has regularly forwarded to IDA its annual operating and capital investment budgets, together with financial forecasts for the following three financial years. * SONEG provided its share of capital investment in the construction of secondary and tertiary systems and the installation of "social" connections, for which it subsidizes 80% of the cost. * As of July 31, 1997, SONEG had -- in a timely manner -- met the requirement to service its debt to the Government. For its part, the Government has at all times fulfilled its commitments with regard to price increases and payment for its own water consumption, despite sometimes considerable delays. IMPACT ON HEALTH AND THE ENVIRONMENT 3. The physical components had the effect of considerably increasing the percentage of the population in Conakry and other centers receiving an uninterrupted water supply. Over the last few years, there has been a reduction in water-borne diseases, and the cases notified have occurred in areas outside the water-supply system. 4. ODC (the Organization for Consumer Protection, a Guinean NGO) acknowledges that water supply is regular, and that operating pressure is satisfactory. Although SONEG and SEEG have made considerable efforts, consumers believe that current water rates are high and that many people cannot afford access to water supply. ODC agrees that standpipes are useful and would like to see more of them, since they provide drinking water for low-income households. 5. Consumers have noted that SEEG is slow to repair leaks (at both government-owned and private facilities) when these are reported, and that frequently there are long delays between consumers' payments for connections and the actual installation of these. RECOMMENDATIONS ON SUSTAINABILITY 6. Now that the present institutional framework has been in operation for eight years, the results achieved are considered generally satisfactory; however, they would be more convincing if all those concerned played their parts effectively. The methods employed here have provided a model for a number of agencies, both in Guinea and abroad. 7. The following are the main factors determining whether these results can be consolidated, and the reforms sustained: * The Government's political will to sustain, enhance, and strengthen the capacities of the mechanisms established as a result of these institutional reforms. 30 * Improvements in system performance. The installation of new works has brought to light a number of leaks in older sections of the system, leading to a deterioration in system performance. Rehabilitation has not helped improve the level of performance (51% as of 1997). Many illegal connections have been eliminated. * For the new installations to be made sustainable, action must be taken to improve system performance, through the location and repair of leaks. * The currently low level of water sales is partly due to the limited number of individual connections in Conakry and the other centers. Appropriate measures must be adopted to increase sales. It is planned to use the following means for reducing the cost of connections, thus providing access to water supply for as many people as possible: => spreading (over a reasonable period) the cost charged to consumers for the installation of connections; introducing a system of monthly billing, making it possible to reduce the minimum volume for consumption to 10 m3, from the current 20 m3 per two-month period (GNF 13,600); => providing facilities for settling consumers' billing arrears; and = in cooperation with the consumers' association, organizing a campaign for raising the consciousness of water-supply users. 8. As regards the institutional structure, all those involved must play their parts fully, so as to confirm and consolidate the progress made. 9. SONEG must be provided with adequate resources for servicing its debts and developing the sector. This means that SEEG must fulfill its contractual duty to make regular payiments of the charges imposed on it, since these are SONEG's main source of revenue. 10. Moreover, the Government must make it possible to improve and consolidate the sector's financial position by regularly paying SEEG for its water consumption. The Minister of the Economy and Finance has agreed to establish effective mechanisms for achieving this end. 11. For its part, SEEG must prepare and implement a business-oriented, effective incentive policy that will enable it to properly recover the charges billed to private consumers. 12. As regards future institutional arrangements, in July 1999 any weaknesses in performance noted over the 10 years that the present operating contract will have been in force should be taken into account in the preparation of the bidding documents for selecting partners to operate the project once the current contract has expired. 31 Annex C Summary of Consumer's Contribution to the ICR ODC: THE ORGANIZATION FOR CONSUMER PROTECTION B.P. 2910, Conakry, Republic of Guinea Tel.: 44.19.45 RECOMMENDATIONS DC (the Organization for Consumer Protection) heartily thanks SONEG, and in particular its Director General, for their kind invitation to participate in this important series of exchanges. This is, indeed, the first time that a large national enterprise has gathered consumers' opinions and comments on its product; in this particular case, the water it supplies. Water is a good that nobody can do without. "Water is life!" Water is the source of all life! Despite these assertions, water can often be mortally dangerous when it is not clean and not drinkable. In fact, it has to be treated with special products before it is safe. Regarding the issues we were asked to examine, our views are as follows: 1. RESULTS * Reliability of service: Very reliable. * Water quality: The water can be consumed as delivered; the quality is therefore excellent. X Social impact: The social impact is directly linked to the cost of supply. Efforts should therefore be made to increase the scope of the social impact, thus providing as many people as possible with an opportunity to become water consumers. * Impact on health: We believe this to be the most important factor. Because of the treatment process, the quality of the water supplied ensures that the consumers will enjoy good health. This water has never been found to have caused harm or been the source of any disease. II. RECOMMENDATIONS FOR SUSTAINABILITY (a) The Conakry system: Not being in possession of any technical data, we cannot express an opinion. (b) Policy on connections: We believe that the following measures should be adopted: * Connections in different sections of the city should be dealt with in the same way. * "Social" (low-cost) connections should be promoted, so that all can have access to water supply. 32 III. DISTRIBUTION METHODS * Individual connections. Such connections are normally provided for civil servants in particular, and workers with a regular income in general. They are usually expensive, and far beyond the reach of everyone who would like to have them installed. * Standpipes. More of these should be installed in the various districts. For example, in Kaporo there are only three standpipes for a population of more than 5,000. The cost is acceptable (a 20-liter container costs GNF 50). It would be prudent -- and even vital -- to provide considerably more standpipes in the outlying districts, where most wells are empty in the dry season. * Tank trucks. This method is available only to those who can afford it, and is generally used to supply water to construction sites in areas where there are no connections, or to swimming pools. IV. PRICING POLICY Living standards in Guinea make it impossible for people to pay the price charged by SEEG. This makes it somewhat difficult to assess the impact of water supply on social issues. V. THE FUTURE INSTITUTIONAL STRUCTURE In our opinion, the present distribution of functions (i.e. operations and capital investment) between SEEG and SONEG is appropriate; however, the income from billings should be distributed more equitably, because currently almost all of it is allocated to SEEG, whereas SONEG has to assume most of the responsibilities. In conclusion, and in addition to the foregoing comments, particularly with regard to reducing the cost of water, we would call for the following measures: (a) Billing should be monthly, so as to make payment easier for customers. (b) Meter reading should be a transparent process, and should be carried out -- if possible -- in the presence of the customers or their representatives. (c) The imposition of penalties for late payments should be reviewed, eliminating the unjust and arbitrary practice of calculating them on the basis of the total amount billed, regardless of the level of payments already effected by the customer. We hope that these proposals will be taken into consideration. In addition, we are ready, at SEEG's request, to launch a wide-ranging programn for raising the consciousness of consumers and educating them to their civic responsibility to pay their bills on time and regularly, to prevent any passively obtained benefit from deception or perpetration of fraud, and to be constantly aware of the need to save water. Is/ El Hadj Nabi vaya Camara, President of the Guinean Consumers' Organization Conakry, Oct 29, 1997 33 Annex D Economic Analysis of the Project 1. The purpose of this analysis is to estimate the economic impact associated with this project. In order to compare this estimate against the estimate contained in the SAR the same approach has been adopted (see SAR Annex 5-2). A reader interested in verifying these calculations should first examine the SAR for the methodology used and then use the following text to understand the changes in data and assumptions. 2. The following data changes have been made to reflect more recent or better data. The Economic Rate of Return to secondary centers was not calculated because the magnitude of these investments is significantly larger than the investments in secondary centers. Consumer Surplus: 3. An average consumer uses 26 lcd (Castalia Study in 1995, Graph 7), and basic consumption (15 lcd) accounts for 58% of this amount. Thus, 58 percent of incremental consumption is used in consumer surplus calculations. Vendor rates assumed for each year are shown. Costs 4. Incremental operating costs are derived from unpublished spreadsheets used in the preparation of SAR for the Water-IEI project. 5. The annual WS-II capital costs were provided by SONEG. Two adjustments have been made to these costs. First, the Japanese Grant of US$6 million is excluded and second, sector rehabilitation costs of US$17 million are also excluded because these are included instead as part of operating costs. Revenues 6. Operating revenues are based on unit sales and tariff projections. Economic Rate of Return Calculations 7. The net benefit streams are discounted to 1998 GNF using actual consumer price indices through the year 1996. Post 1996 net benefits are expressed in constant 1996 GNF and these are converted to 1988 GNF before calculating the Internal Rate of Return. 34 Republic of Guinea ____ - ~~~~~~~~Second Water Supply Project __ - consumpction IMonetized Benefits _____Capital and Operating Costs I____ 1I988 GNF____ _______ _______ _______Increment Increment Vendor Increment Consumer Total Capital Increment Incremental Net ____Net Yer MEom3e wIo Proj Total Basic Con Water R Rate Revenue Surplus Benefits costs O.Cost ICap& Op Bnft Benefits Year__ Million __Mlin__ Mlin__Mlinm_Fm Fr3 FMlin FMlinGFMlin GFMlinG MillionlGF Million GE Million lIndex GE Million 1987 58% Exc. Debt S___ __ ___ 1988 9.4 9.35 0.00 0.00 60 600 - - - - - 0 ____ 1989 10.0 9.60 0.40 0.23 150 600 60 1 52 112 - --112 _ 1 112 1990 13.8 9.601 4.18 2.43 150 800 627 788 1,416 1,071 116 1,186 230 1.19 192 1 19911 10.8 9.601 1.21 0.70 320 1,000 386 238 624 3,973 224 4,197 (3,572) 1.43 (2,501) 1992 1 11.6 9.60 2.01 1.16 680 1,200 1,__363 302 1,6661 1 23,770 344 24,114 (22,448) 1.66 (13,484) 1993 12.8 9.60 3,21 1.86 880 1,700 2,827 764 3,591 1 28,638 441 29,079 1(25,487) 1.78 (14,291) 1994 15.5 9.60 5.92 3.44 880 1,700 5,2`12 1,408 6,621 14,050 528 1 14,578 1(7,957) - 1.86 (4,2811 1995 13.7 9~60 4.07 2.36 880 1,700 .3,581 968 4,548 4,834 559 1 5,393 1 (845) - 2.03 (417) 1996 12.6 9.60 2.95 1.71 880 1,700 2,598 702 3,300 6,686 590 7,275 (3,975) - 2.05 (1,942) 1997 13.8 9.60 4.20 2.44 940 1,700 3,948 926 4,874 2,261 621 282 192- 2.05 973 1998 14.9 9.601 5.30 3.07. 940 1,700 4,982 1,166 6,150 1,068 655 1,723 442 2.05 2,163 1999, 16.0 9.60 6.40 3.71 940 1,700 6,016 1,411 7,427 3,662 690 4,352 304- 2.05 1,502 1 20001 17.2 9.60 7.60 4.41 920 1,700 6,992 1,719 8,711 1 4,476 727 5,202 3,509 - 2.05 1,714 1 20011 18.8 9.60 9.20 5.34 920 1,700 8,464 2,081 10,545 4,158 765 4,923 1 5,622 - 2.05 2,748 1 20021 20.5 ~9.60 10.90 6.32 920 1,700 10,028 2,466 12,494 3,830 806 4,636 7,857 2.05 3,838 2003 22.3 9.80 12.70 7.37 900 1,700 11,I.430 2,94-6 14,376 1,559 848 1 2,407 11,969 - 2.05 5,847 2004 24.3 9.-60 14.70 8.53 900 1,700 13,230 3,410 1660- 893 893 15,748 2.05 7,693 2005 26.3 9.60 16.70 9.69 900 1,700 15,030 3,874 18,904 - 9.40 940 17,965 - 2.05 8,776 2006 26.3 9.601 16.70 9.69 900 1,700 15,030 3,874 18,904 989 989 17,915 - 2.05 8,752 2007 26.3 9.601 16.70 9.69 900 1,700 15,030 3,874 18,904 _____ 1,041 1,041 17,864 - 2.05 8,726 2008 26.3 9.60 16.70 9.69 900 1,700 15,030 3,874 18,904 1,095 1,095 17,809 - 2.05 8,700 2009 26.3 9.60 16.70 9.69 900 1,700 15,030 3.874 18,904 1,095 - 1,095 17,809 - 2.05 8,700 20101 26.3 9.60 16.70 9,691 900 1,700 15,030 3,874 18,904 1,095 1,095 17,809 - 2.05 8,700 1 20111 26.3 9.60 16.70 9.691 900 1, 7600 1-5,0-30 3,874 18,904 1,095_ __1,095 17,809 - 2.05 8,700 20`12 26.3 9.80 '16.70 9.69 900 1,700 15,030 3,874 18,904 1,09 1,095 17,809 2.05 8,700 2013 26.3 9.60 16.70 9.69 900 1,700 15,030 3,874 18,904 1,095 1,095 17,809 - 2.05 8,700 2014 26.3 9.60 16.70 9.69 900 1.700 15,030 3,874 18,904 1,095 1,095 117,809 - 2.05 8,700 2015 26.3 9.60 16.70 9.69 -900 -1,700 15,030 13,874 18,904 1,095 1,095 17,809 2.05 8,700 2016 26.3 9.60 16.70 9.69 900 1,700 15,030 3,874 18,904 1,095 1,095 117,809 - 2.05 8,700 2017 26.3 - 9.60 16.70 9.69 900 1,700 15,030 3,874 18,904 1,095 1,095 117,809 - 2.051 8,700 2018 26.3 9.60 16.701 9.69 900 1,700 15,030 3,874 18,904 1,095 1,095 117,809 2.051 8,7001 2019 26.3 ~9.60 16.701 9.69 900 _..1,700 15,030 3,874 18,904 1 1,095 1,095 117,809 ___2.05 8,700 20201 26.3 9.60 16.701 9.69 900 __1,700 15,030 3,874 18,904 1 1,095 1,095 17,809 __2.05 8,700 2021 2 ~6.3 ~9.60 16.701 9.69 9002T 1,700 15,030 3,874 18,904 1,095 1,095 17,809 2.05 8,7001 202 26.31 9.60 16.701 9.69 900 1,700 1500 3,874 1 8, 904 11,095 1,095 11,809 2.05 8,700 2023 26.31 9.60 16.70 9.69 I 900 1,700 15,030 3,874 18,904 I11,095 1,095 17,09 2.05 6,700 202 26.31 9.60 16.70 9.69 0 1,700 15,030 3,874- 18,904 11,095 1,095 117,809 __ 2.05 8,700 1 2025 1 26.3 9.801 16.70 9.69 900 1,700 115,030 3,874 18,904 1,095 1,095 17,809 2.105 8,700 1 2026 1 26.3 9.601 16.70 9.69 900 1,700 15,030 3,874 18941,095 1,095 17,809 12.05 8,700- 1 2027 26.3 9.601 16.70 9.69 900 1,700 15,030 3,874 18,904 11,095 1,095 17,809 2.05 8,700 1 2028 26.3 9.601 16.70 9.69 900 1,700 15,030 3,874 18,904 11,095_ 1,095 17,809 2.05 8,700 2029 26.3 9.601 16.70 9.69 900 1,700 15,030 3,874 18,904 1,095 1,095 17,809 2.05 8,700 2030 26.3 9.60 16.70 9.6L9 900 __1,700 15,030 3,874 18,904 105 1,095 17,809 2.05 8,700 2031 26.3 9.60 16.70 9.6 90 1,0 1530 ,84 894 1,095 1,095 17,809 2.05 8___,700 2032 26.3 9.60 16.70 9.69i 900 1,700 15,030 3,874 '18,904 1,095 1,095 17,809 2.05 8,700 2033 26.3 9.60 16.70 9.691 900 1,700 15,030 3,874 18,904 1,095 1,095 17,809 2.05 8,700 _______ __________ ~~~~~~~~~~~~~~~~~~~~~~10% MAP SECTION EBRD 27322 I ' 12- t 10 4t< ~~~~~~~~~~~~~ ~ ~~~~~~G U I N E A B, IRD72 I4- 12z GUNE SENEGAL THIRD WATER SUPPLY AND SANITATION PROJECT , - ------- -r.----- ToKWgoSITUATION OF THE WATER SUPPLY IN THE URBAN CENTERS GU I NEA- * - J - \ W4yg5oa! -12 1- , f , / /I S.ngarbdi N> ind.d M A L I 9 /v;) ,qe lo T-don \ , _10 1 ATLANT'~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ob, A TL A hI rJ ( * ! 2 ~~~~~~~~SIERRA LEONE k\P2Mrb7 OCE EA N [soS -\)> w >o~~~~~~~~~~~~~~~~N -7! o 20 40 6O B0 100 120 Bonty no URBAN CITIES WITH EXISTING WATER (C KILOMETERS 1X - Fiq UR6~~~~~~~ANCILTIES UWNDER CONSTRUCTION - - DIVOiRE MAURITANIA / _._ MAURITANIA j [ia OTHER URBAN CENTERS TO BE EQUIPPED , '~~~~~ ~~~ -EEA - - - - - BEFORE THE YEAR 2005 5 )j SENEGAL NK GABIHE ',- PAVED ROADS THEA --BI=A, ROUTES PAVEES .I GUINEA- < 7_ /x/ 8ALL-WEATHER ROADS BISSAI.L( /BURKINA ROUTES PEAT/CABLES PAR TOUS TEM PS 0 ~~~~~RAILROADS I GUINEA PASO CHEMIN4 DE FER Conok,y G 'B,..t. '.t FLEUVES + N -\ I SIERRA - L * NATIONAL CAPITAL 5' Theho LEONE -d APTLEk( eoool ,o oy -,. ;, i ' COTE D'IVOIRE PREFECTURES C APIT ,ALS I,o nhoof PREFECTURE AIAS, , JBERIA"'- \ PREFECTU REESBOUNDARIES LIBERIA ' \T. A6- The dWhW Bo oP, A T L A N T;I C ">LIMITES DES PREFECTURES - ~ 1-h .. A T-' L A N T I C L BERIA ~ (. Z _ _ INTERNATIONAL BOUNDARIES 'b- ll dyloln,lolI , G C E A I i FRONTIERES INTERNATIONALES -oyptoeof suh SEPTEMBER 1995