DowunmMu of The World Bank FOR OFFICIAL USE ONLY Report No. P-4251-GM REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT OF SDR 5.3 MILLION TO THE REPUBLIC OF THE GAMBIA FOR A SECOND HIGHWAY MAINTENANCE PROJECT March 5, 1986 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 = Dalasis (D) US$ 1.0 = D 5.2 1/ D 1.0 = US$ 0.19 US$ 1.0 = SDR 1.11 FISCAL YEAR July 1 - June 30 SYSTEM OF WEIGHTS AND MEASURES (METRIC) 1 meter (m) 3.28 feet (ft) 1 square meter (n2) 10.76 square feet (sq ft) 1 cubic meter (m3) = 35.3 cubic feet (cu ft) 1 hectare (ha) = 2.47 acres I kilometer (km) 0.62 mile (mi) I square kilometer (kM2) = 0.39 square mile (sq mi) 1 metric ton Ct) = 2,205 pounds (lb) I liter (1) 0.26 US gallors (gal) ABBREVIATIONS AND ACRONYMS AfDF African Development Fund EEC European Economic Community GPA Gambia Port Authority GPMB Gambia Produce Marketing Board GPTC Gambia Public Transport Company GRTA Gambia River Transport Authority GRTC Gambia River Transport Company GTTI The Gambia Technical Training Institute GUC Gambia Utility Corporation MDI Management Development Institute MED Mechanical Fngineering Division MEPID Ministry of Economic Planning and Industrial Development HF&T Ministry of Finance and Trade MWC Ministry of Works and Communications ODA(UK) Overseas Development Administration (UK) FWD Public Works Department SIDA Swedish International Development Association UNDP United Nations Development Programme LNSO United Nations Sudano-Sahelian Office USAID United States Agency for InternAtional Development 1/ As of February 20, 1986. A flexible exchange rate system went into effect on January 20, 1986. - 1 - FOR OFFICIAL USE ONLY THE GAMBIA SECOND HIGHWAY MAINTENANCE PROJECT CREDIT AND PROJECT SUMMARY Borrower: The Republic of The Gambia Credit Amount: SDR 5.3 million (US$ 5.8 million equivalent) Terms: Standard Co-Lenders: IDA (US$5.8 million equivalent); AfDF (US$4.5 million equivalent); EEC (US$2.0 million equivalent); UNSO (US$0.6 million equivalent) and UNDP (US$0.7 million equivalent). Project Description: The project would support the efforts of the Ministry of Works and Communications (MWC) in carrying out its four-and-one-half-year (1986 to mid-1990) road maintenance program which is comprised of the following components: (a) rehabilitation of part of the paved network; (b) continuation and expansion of routine and periodic road maintenance programs; (c) strengthening of the organisation and management of MWC to improve the efficiency of road and equipment maintenance; (d) introduction of sound transport planning procedures; and (e) assistance to domestic contractors to enable their more effective participation in road maintenance activities. Project Benefits and Risks: The main benefits of the proposed project would be improvement in the physical condition of The Gambia's road network and in the functional efficiency of MWC. These two aspects are essential in the protection of highway investments, the reduction of vehicle operating costs, and the prevention of rising road user costs as a result of worsening road conditions. Other benefits include the positive effects on agricultural production because of reduced transport costs. Based on the satis- factory implementation of the First Highway Maintenance Project (1979) and the commitment of the Government to reorganize MWC and improve its management procedures, there would be no major risks concerning project imple- mentation. However, further aggravation of The Gambia's economic situation could limit the timely availability of the Government's contribution of funds for maintenance. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. THE GAMBIA SECOND HIGHWAY MAINTENANCE PROJECT Sumary Project Cost Estimate - US$ Thousands - Estimated Cost Local Foreign Total 1. Road Maintenance Program (a) Regravelling, Resealing, Paving 367 1,570 1,937 (b) Routine Road Maintenance 946 1,513 2,459 (c) Feeder Road Maintenance ' 172 401 573 (d) Equipment and Vehicles 0 1,748 1,748 (e) Road Maintenance and Workshop Mgmt. 160 1,430 1,590 2. Road and Bridge Rehabilitation (a) Bund Road 188 784 972 (b) South Bank Road 376 1,558 1,934 (c) Brumen Bridge 172 748 920 3. Institutional Strengthening (a) Planning, Studies, and Auditing 40 360 400 (b) Management and Training for MWC 39 351 390 (c) Study and Training for Domestic Contractors 4 36 40 (d) Equipment, Materials, and Courses for MWC 70 110 180 4. Repayment of PPF Advance 55 495 550 Base Cost (February 1986) 2,589 11,104 13,693 Physical Contingencies 81 352 433 Price Contingencies 487 1,789 2,276 Total Project Cost a/ 3,157 13,245 16,402 Financing Plan (Rounded) Local Foreign Total IDA 580 5,220 5,800 UNSO 115 485 600 AfDF 480 4,020 4,500 EEC 35 1,965 2,000 UNDP 70 630 700 Government 1,877 925 2,802 Total 3,157 13,245 16,402 al Project items are exempt from all taxes and duties except for a small amount from local contracts for road maintenance activities. Estimated IDA Disbursements: IDA Fiscal Year (US$ Millions) FY87 FY88 FY89 FY90 FY91 FY92 Annual 1.6 1.4 1.2 0.7 0.6 0.3 Cumulative -1.6 3.0 4.2 4.9 5.5 5.8 Economic Rate of Return The estimated economic rate of return (ERR) for the project, based on quantifiable benefits covering about 79% of overall cost, is about 38%. Staff Appraisal Report: No. 5798-GM, Dated February 28, 1986 Map: IBRD 18944 INTERNATIONAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS .ON A PROPOSED DEVELOPMENT CREDIT TO THE REPUBLIC OF TBE AMBIA FOR THE SECOND HIGHWAY MAINTENANCE PROJECT 1. I submit the following report and recommendation on a proposed Development Credit to the Republic of The Gambia for SDR 5.3 million (US$5.8 million equivalent) to help finance the Second Highway Maintenance Project. The Credit would be on standard IDA terms. Additional external financing for the project will be provided by a loan from The African Development Fund (AfDF) in the amount of US$4.5 million equivalent on IDA's same terms. The European Economic Community (EEC) is expected to provide a grant of US$2.0 million equivalent. In addition, the United Nations Sudano-Sahelian Office (UNSO) would provide a grant of US$0.6 million, and UNDP a grant of US$0.7 million. PART I - THE ECONOMY 2. The latest economic report on The Gambia dated September 6, 1985 (The Gambia - Development Issues and Prospects Report No. 5693-GM) has been circulated to the Executive Directors. Its conclusions are reflected in the following assessment of the state of the economy and its prospects. Country data appear in Annex I. The Land and its People 3. The Republic of The Gambia comprises a narrow east-west strip of land bordering the Gambia River and surrounded on three sides by the Republic of Senegal. The terrain is extremely flat, maximum elevation being only 35 meters above sea level. Three regions can be distinguished from the mouth of the River inland: the mangrove belt, which extends upstream for over 240 km; the "bantofaros", areas that become swamps in the rainy season and parts of which are under rice cultivation; and, finally, the plateau of the eastern portion of the country which is intensively cultivated in groundnuts, millet, and other crops. 4. The population (about 700,000 in 1983) is predominantly rural, some 75Z of the work force being engaged in agriculture and animal husband- ry. Average population density is 90 persons per km2 of arable land and reaches higher levels in some areas. Population pressure and persistently disappointing harvests have in recent years prompted emigration to urban districts and aggravated urban employment, particularly in and around the capital and commercial center of Banjul. Structure of the Economy 5. The Gambian economy is traditionally centered on the production of groundnuts. its major foreign exchange earner. Apart from groundnuts, -2- cereals (millet, sorghum and rice) and livestock represent the principal products of the agricultural sector. Manufacturing activity is limited, with the principal activities being groundnut crushing and a few modest manufacturing enterprises supplying the domestic market, all of these located in Banjul. Fishing resources exist but appear to be substantially underexploited at present. The country is heavily dependent on trade, importing about half of its food supplies, all of its fuel and capital goods and most other manufactured goods. Exports are highly concentrated , with a single commodity, groundnut products, accounting for 85-90% of the value of domestic exports. Other domestic exports include small amounts of fish, hides and skins, cotton, and palm kernels. 6. Outside of agriculture, the most important features of the economy are its tourism industry, and a well-developed commercial sector, which for most of The Gambia's history has been involved in reexport trade to other countries in the region. This trade expanded rapidly in the 1970s, as The Gambia maintained its traditional open-trade policy, while neighboring countries increasingly resorted to high tariffs and quotas to protect domestic industries. The Gambia's small size, substantial openness and heavy dependence upon a single export crop make it an inherently vulnerable economy, highly sensitive to shortfalls in agricultural pro:uc- tion caused by drought and to changes in the terms of trade. Evolution of the Economy 7. In the 1960s and 1970s, The Gambia grew at close to 5% per year, one of the best performances in Africa. It had a strong currency and a sound budgetary situation. However, over the past decade, The Gambia has seen its economy deteriorate progressively. Real GDP growth rate -- 1.4% on average per annum -- has been one of the lowest of any country in Africa not affected by war and civil strife. Given the estimated population growth rate of 3.4% per year, this implies a loss of at least 20% in per capita income in the last 10 years. The average per capita income in 1984 was only US$260. Underlying the poor performance of GDP, there has been a significant downward trend in groundnut production despite encouraging increases in food crop production. However, the dramatic shift in the economy is also the result of longer-term changes in the structure of the economy induced by past tivestments, the rapid growth of the public sector and high urban migration. 8. The public sector grew rapidly as a result of The Gambia's investment effort which started in the mid-1970s, largely because, given the country's low level of development, investment was initially channeled into basic economic and social infrastructure (roads, schools, agricultural extension stations, health clinics, etc.) and civil servants were rapidly recruited to furnish new services. Between 1976 and 1980, established posts in the government doubled and by 1981/82, the share of GDP absorbed by government expenditures increased to 41%. By 1983, the public sector (government administration and public enterprises) accounted for two-thirds of total modern wage employment. -3- 9. Until the late 1970s, The Gambia was able to maintain broad balance of payments equilibrium in large part thanks to the central govern- ment and to the Gambia Produce Marketing Board (GPMB), a parastatal organ- ization. The marketing board was able to maintain stable prices to farmers over the period, thereby encouraging production for export. Although producer prices were kept fairly stable, farm incomes were not, and income declines in years of bad harvests tended to depress the demand for imports along with the fall in exports. At the same time, the Government main- tained a surplus on its current budget, which, along with foreign grants and highly concessional aid, was used to finance a modest level of public investment. 10. Beginning in the late 1970s the public sector shifted from a position of overall surplus to significant and growing deficits substan- tially exacerbating the inherent instability of the Gambian economy. Rapid growth of public sector employment and development expenditures contributed to large increases in imports due to the high import consumption of the .fast-growing urban population, especially public sector wage earners, and the high import component of general government expenditures and develop- went projects. These factors created a "structural deficit" in The Gambia's trade: domestic exports (as distinct from reexports), even in a good year, were increasingly unable to generate foreign exchange sufficient to cover the cost of domestic imports (principally fuel, foodstuffs, and capital goods). At the same time, the softening world prices for groundnuts and the hike in the world oil prices combined to bring about a serious deterioration in The Gambia's terms of trade. In 1982, these stood at one-third of the level attained in the mid-1970s. 11. The above factors brought about a significant deterioration of the overall current account from 1979 to 1983. Severe adjustments that might otherwise have been necessary were to some extenti averted by a massive increase in external assistance to The Gambia in 1980-81 in the aftermath of a severe drought and an attempted coup d'tat in July 1981. Total (net) resource flows rose to roughly US$85 million a year, double the average level of previous years; the inflow of foreign resources was equal to 35-40% of The Gambia's GDP. As a result of this assistance (about half of which was grant aid) the country was able not only to maintain annual investment at close to 20% of GDP but also to avoid a decline in consump- tion. 12. When capital inflows returned to more normal levels beginning in 1982, consumption -- particularly government consumption - proved diffi- cult to restrain. Arrears on external payments accumulated rapidly, reaching nearly US$60 million (equal to 32% of GDP) by June 1984. As a result of the rapid deterioration of the balance of payments, the official exchange rate for the dalasi, which had been pegged at D 4.00 per pound sterling since 1974, could not be maintained. In February 1984, the Government implemented a 25% devaluation, to D 5.00 per pound sterling. -4- Government Response 13. Since 1980, the Government has made several attempts to adjust the economy, including negotiations of two Stand-by Arrangements with the IMF. In 1981, the Government received various forms of immediate financial support from the Fund, including SDR 9 million in "compensatory financing" and two Trust Fund loan disbursements. These were followed by a one-year Stand-by Arrangement of SDR 16.9 million adopted in February 1982. The Stand-by program aimed at lowering the public sector deficit through reductions in consumer subsidies and selective tax increases, pnd stimulat- ing production through higher purchase prices for groundnuts and rice. The program produced mixed results. The fiscal deficit was reduced from 21% to 142 of GDP, although this was entirely accomplished through increased revenues and a drastic compression of expenditures on material and current supplies; government wages and salaries actually increased by nearly 30% under the program. There also appears to have been a significant supply response to the producer price increases: groundnut area planted rose to the highest level' ever and production reached a record 150,000 tons. Unfortunately, however, these results coincided with a sharp decline in world groundnut prices. 14. Continued balance of payments deterioration in 1983/84, a decline in real GDP associated with poor rainfall and crop production, and an increase in the fiscal deficit led the authorities to negotiate a further Stand-by Arrangement in early 1984. Policy adjustment. under the new SDR 12.8 million Stand-by program (covering the period April 1984-July 1985) included the 25% devaluation mentioned earlier, producer price increases plus stiff price increases to reduce subsidies on rice, fertilizers and public transport. On the expenditure side, the Government adopted a hiring freeze, except for pressing emergencies, and limits on supplementary appropriations. Monetary adjustments included increases in interest rates on deposits and guidelines to limit commercial bank credit to the private sector. Although the Government implemented the agreed measures, it was not able to meet the June 1984 targets for reductions in external arrears and net credit to the Government, the GPMB, and the private sector. As a result, after one disbursement of SDR 2.63 million, the program was effec- tively cancelled on April 22, 1985. 15. The macroeconomic adjustments undertaken in early 1984 constitut- ed a notable effort by the Government to redress The Gambia's external and fiscal deficits. However, the exceptionally low (45,000 tons marketed) 1984/85 groundnut crop caused real GDP to decline by 9% and seriously exacerbated the acute shortage of foreign exchange. Significantly, al- though rainfall was uneven in some parts of the country, the low groundnut crop appears to have been less the result of drought than of inadequate price incentives and institutional weaknesses, which continue to have a crippling effect on the economy. According to the Ministry of Agriculture, several thousand hectares were prepared for groundnut cultivation-but could not be planted due to the late distribution of seeds. Pest infestation was also unusually severe, in part associated with the lack of fuel and pesti- cides for the Ministry's crop protection services. As a result, many of the potential benefits of the 1984 devaluation as well as of the high world groundnut prices were not realized. 16. In recent months, The Gambia's situation has become increasingly serious. Record low groundnut export revenues (US$16 million) and increas- ing external debt service due (US$18 million, insluding IMF charges and repurchases) in 1984/85 have produced a further deterioration of the current account deficit: from 17Z of GDP in 1983/84 to 25Z in 1984/85. As net capital inflows were not sufficient to finance this deficit, additional external arrears which at end 198,4 had reached US$8.6 million, increased by another US$7.5 million at end 1985. The continued accumulation of arrears is already having a negative impact on disbursements. However, it is expected that an IMF agreement would be followed by a debt rescheduling agreement which would bring debt service more in line with The Gambia's ability to pay. The Recovery Program 17. Faced with increasing economic and financial difficulties, the Government in recent months has become convinced of the need for a comprehensive set of macroeconomic policy adjustments. In June 1985, it moved quickly to develop, in consultation with the World Bank, an Economic Recovery Program (ERP), which addresses both the need to improve the productive capacity of the economy through alleviating existing supply constraints and the need to pursue prudent demand management policies on a sustained basis in order to overcome the present internal and external imbalances. In July 1985, an MF mission visited The Gambia and agreed with the Government on an adjustment program, more comprehensive than the previous abortive program. An IMF Stand-by, however, was not put in place due to The Gambia's mounting arrears to the Fund which have still io be settled. However, the reforms agreed with the IMF were incorporated into the ERP which the Cabinet approved in August 1985. The major elements of the recovery programs are: price incentives and institutional reforms to achieve a rapid expansion of agriculture production, both groundnuts and food crops; removal of disincentives and other measures to stimulate faster growth in other productive sectors (industry, fisheries, tourism); adoption of a flexible exchange rate system; civil service retrenchment; a significant reduction in government consumption and a strong shift in the composition of current expenditures to achieve a more productive balance between expenditures on wages and salaries and expenditures on current supplies; and ndoption of a stringent core program of public investment focused on (i) quick-gestation projects producing traded goods, and (ii) rehabilitation projects which include donor support for recurrent costs and lead to higher utilization of existing capacity. 18. The Governme=t has moved quickly under the ERP to introduce the envisaged reforms and a number of measures have already been taken, including the introduction of the exchange rate reform, increases in the *price of both agricultural products and inputs and elimination of consumer food subsidies, particularly on imported rice. The Government also laid off over 1,000 temporary staff in the ministries, and has well in hand - 6 - steps to lay off a further similar number. The new flexible exchange rate system vent into effect on January 20, 1986 with the assistance of a technical adviser from the IMF. In support of this system, liberalised licensing and exchange control procedures were also announced. The success of the reform program could, however, be constrained by the crippling scarcity of foreign exchange over the near-term. Reflecting this scarcity, by February 20, 1986, the Dalasi had depreciated by 50% vis-a-vis the pound sterling. Without, in particular, a rapid solution to the arrears problems (specifically the arrears to the IMF) it is difficult to begin dealing with the longer-term problem, given the sequential link between an IMF program, debt rescheduling, gap filling and expanded commitments. With the assistance of the Bank, the IMF and bilateral donors, the Government is currently making a major effort to mobilize donors' support for its economic recovery program while it is trying at the same time to make separate arrangements for bridging finance in order to clear its arrears to the IMF and pursue negotiations with this institution. 19. Despite the courageous steps taken by the Government to liberalize prices, adjust the exchange rate and reduce public employment, I very recent information indicates that the reforms have been slowed down by poor credit and fiscal management. In the period July to December 1985 money supply was allowed to expand much faster than envisaged in the adjustment program prepared in consultation with the IMF. Consequently, a new program with revised targets will need to be agreed. PART II - BANK GROUP OPERATIONS IN THE GAMBIA 20. To date, the Bank Group has extended eleven credits to The Gambia, totalling US$56.3 million. Of these, three were in the transport sector, three in the agricultural sector and one each in tourism, educa- tion, rural and urban enterprises, energy and urban development. Project implementation has in general been satisfactory as far as the execution of the physical targets is concerned. The disbursement performance has also been reasonably good and compares well with other countries in West Africa with similar profiles. Institution building, however, has lagged behind, largely due to a dearth of skilled personnel in most agencies. The situa- tion has improved somewhat in the last five years, as IDA projects are being increasigly designed with objectives better adapted to existing manpower constraints in the country. Our policy dialogue was minimal in the 1970s and, though it developed progressively, it remained project oriented, with the I14F being the only institution conducting a macroeconom- ic dialogue. This too has changed as our lending has become increasingly policy-based. Both projects approved in FY84 (the Second Agricultural Development and the Urban Management and Development Projects) addressed major policy issues. 21. Given The Gambia's urgent need to reverse current adverse finan- cial and economic trends, the Bank Group, in close cooperation with the IMF, is assisting the Gambian authorities in the elaboration and implemen- tation of the Economic Recovery Program. This is a crucial and necessary step for improving the country's prospects in the short-term, medium-term - 7 - and long-term, as it would help in mobilizing BOP assistance, negotiating debt rescheduling and stimulating an increase in project aid commitments. In support of such a program, a Structural Adjustment Credit (SAC) is under preparation. The acute shortage of foreign exchange, together with inadequate policies, remains the main obstacle to a recovery of the econo- my. The proposed SAC would finance most urgently needed imports of capital goods and inputs. The adjustment effort will have to be sustained over a number of years given the structural nature of the Gambian problems. The country will also continue for quite some time to face a considerable foreign exchange shortage. We are, therefore, considering a second SAC operation to follow the one currently in preparation. 22. While we expect to be heavily involved in the near future in supporting macroeconomic policy changes and improved economic management, in assisting the Government in debt rescheduling and mobilizing the international community in support of The Gambia's rehabilitation program, the Bank will continue to support The Gambia through project lending in key sectors. Consistent with a strategy that emphasizes more effective utilization of the existing capacity, we are preparing projects that focus on helping the Government rehabilitate essential economic, physical and social infrastructure. 23. Agriculture. Improving the performance of the agricultural sector is critical for sustained edonomic growth in The Gambia. The Gambia has good quality arable land, reasonable rainfall and diversified cropr.ing patterns. Yet over the past ten years agricultural production has declined by 1.4% on average per year; food imports have continued to increase and now represent the largest item on the country's import bill. Drought as well as inadequate government policies and institutional weaknesses have contributed to the sector's poor performance. The main policy issues which need to be addressed by the Government in order to revitalize the sector are: (i) appropriate producer prices; (ii) inefficient marketing; (iii) input delivery, which has been most unsatisfactory both in terms of quanti- ties and timeliness; (iv) difficulties in sustaining a viable system of agricultural credit; and (v) development projects and credit schemes which have ignored the role played by women in agriculture, particularly rice production. 24. The IDA-supported Second Agricultural Development Project, approved in FY84, the Government's largest investment in the agricultural sector, addresses the above issues, with particular emphasis on prices, input delivery and extension. The project will also help strengthen the extension system and reorganize the Ministry of Agriculture as well as increase the availability of seeds. To improve our knowledge of the sector we plan to intensify our agricultural sector work. 25. Transport. In this sector, our basic objective is to strengthen and improve maintenance management and streamline institutions. Substantial investments were undertaken under the first and second five year plans to expand the paved road network, the Banjul Port and the Yundum Airport. The Government has, I-owever, been unable to meet the growing -8- maintenance requirements of its investments. The ongoing Second Banjul Port and First Highway Maintenance projects address priority rehabilitation and maintenance needs in the sector. The proposed Second Highway Mainte- nance Project will address the long overdue periodic maintenance requirements of the paved road network; it will also deal with a number of important issues: (i) the organization and management of the Ministry of Works and Communications; and (ii) reassessment of the Government's priorities in the transport sector. River transport plays an important role in The Gambia. It is used for moving groundnuts and bulk goods (fertilizer, cement, etc.). Yet river transport vessels and wharves are in dire need of repair to avoid breakdowns, which would affect groundnut evacuation and fertilizer distribution and thus have a direct bearing on export production. 26. Water and Electricity Supply. The rapidly expanding population in the Banjul area (at a rate of over 6% p.a. in the last 10 years) has strained the existing water supply facilities, causing frequent water shortages and increasing health hazards. It has also caused an overload of the existing electricity distribution system. A proposed Water and Electricity Project will rehabilitate and reinforce the existing systems and supply distribution capacity. An important objective of the project is to strengthen the management and operations of The Gambia Utilities Corporation (GUC), currently incurring large financial losses due to a low tariff policy. 27. Industry. Prospects appear reasonably good for resource-based processing activities. To be able to assist the Government in formulating a program of action for this sector as well as other small scale enterprise activities such as construction, fisheries, trade and agriculture, small scale enterprise review was undertaken in February 1986. A report on the mission's findings is currently being prepared and could form the basis for a possible SSE project. Technical assistance for the financial and organ- izational restructuring of the Gambia Commercial and Development Bank (GCDB), the largest commercial bank and only term-lending institution in the country, is being contemplated under the proposed SAC operation. 28. Health and Population. Although the Government has taken steps in policy and programs to improve the country's health situation, progress in reducing morbidity, mortality and fertility rates has been discouraging- ly slow. The country's high levels of poverty and illiteracy are important constraints to an effective health care delivery system. However, an Important part of the problem stems also from the incapacity of the system to finance recurrent costs and from shortcomings in the core infrastructure of the services delivery system. With IDA assistance, the Government is preparing a Population and Health project which will assist with financing and policy reforms (through introducing cost recovery mechanisms) in meeting short-term recurrent cost problems, and would undertake selected long-term investments in manpower development, communication, infrastructure and analytical capacity. The project will also help strengthen family planning as well as assist the Government in developing a comprehensive family planning policy. -9- PART III - THE TRANSPORT SECTOR The Transport System 29. The transport system links the interior of the country with the capital and principal port of Banjul at the mouth of the Gambia river and provides for north-south overland transport corridors connecting Northern and Southern Senegal. The system consists of a relatively well-developed road network comprising some 510 km of paved roads, 800 km of laterite gravel roads and about 1,080 km of earth roads and tracks. Because the river separates the country in two, a partial duplication of road facili- ties on the river's northern and southern sides has taken place. The river is navigable for vessels up to about 4,000 dwt fully laden as far as the port of Kaur, some 230 km upstream, and for smaller craft over the remain- ing 120 km portion in The Gambia. The river system can be crossed in seven places by vehicular ferries. The Gambia has an international airport at Yundum, some 20 km from Banjul, but no railway, aviation or maritime shipping lines (Map IBRD 19844). 30. Port facilities at Banjul are undergoing renewal and expansion under the IDA-financed Second Port Project (Credit 1266-GM of September 1982). After project completion, the port's capacity will be adequate for the foreseeable future. Present annual traffic consists of about 285,000 tons of dry cargo and 44,000 tons of petroleum products as imports, and 12,000 tons of groundnut oil as exports. 31. Banjul airport is adequately equipped and includes one of the longest runways (3,600 m) in West Africa. Terminal facilities are modest and require only minor improvements to handle some 120,000 passenger movements per year, 60Z of whom travel on charter flights. Gambian Airlines handles ground services only. 32. Passenger transport is provided by the private sector which uses mostly minibuses in competition with the Government-owned Gambia Public Transport Company (GPTC) which operates about 50 large buses for urban, suburban, rural and tourist services. Passenger transport by river is negligible, except for the vehicle ferry services and small ferry boats. 33. Freight is carried by about 500 trucks, mostly privately owned, and by an aging and deteriorated fleet (para 25) of 50 barges and 8 tugs owned by the Gambia River Transport Company (GRTC). Commodities transport- ed by river are especially groundnuts and other bulky goods such as cement and fertilizer. The annual volume of river transport ranges from 60,000 to 110,000 tons, mostly depending on harvest results. All ferries are in poor condition and many of the smaller ones are frequently out of service. The ferry boats and ramps for the ferry at Banjul are to be rehabilitated with German assistance, and financing is being sought from the Government of Japan for the replacement of ferry boats at the Trans-Gambian highway crossing. Ferry services have been operating at a substantial loss but a recent tariff increase of 75% aims at remedying this. Furthermore, efforts -0O- will be made to collect all ferry charges from Senegalese vehicles in convertible CFA Francs. L 34. Transport sector administration is predominantly the responsibil- ity of the Ministry of Works and Communications (MWC) which supervises directly the national road network. Banjul city and Kanifing Urban Dis- trict (near Banjul) are, in principle, responsible for about 70 km of paved streets. Gravel and earth roads and tracks in rural areas come under local jurisdictions. In practice, MWC is the only organization doing regular road maintenance, and provides ad-hoc assistance for roads under other jurisdictions. The local road network is generally adequate for the country's needs, except in the Northeast. About 80% of all villages are within 5 km of a road or track, and the main transport activity (ground- nuts) occurs in the dry season. Local authorities and communities carry out road repairs as needed and when funds are available. About 420 km of local tracks have been upgraded since 1978 to semi-engineered gravel standard (6 m wide) under the UNSO Feeder Road Program, and maintenance responsibility for 246 kk has been handed over to MWC. A further 83 km are about to be upgraded by UNSO, with EEC financing, in the Northeast. 35. CPA and GPTC are financially and operationally autonomous agen- cies under MWC, but ferry, bus and port tariffs have to be approved by The Government. Both GPTC and GPA have operated at a loss in recent years. The latter has been losing money because of low ferry tariffs (para 33). GRTC forms part of the Gambia Produce Marketing Board (GPMB) which falls under the Ministry of Agriculture. GPMB is the dominant user of river transport, but uses road transport when cheaper or more convenient. Transport coordination has therefore largely been the result of operational practices by GPMB rather than the outcome of careful planning. The role of river transport in the future development of The Gambia will be assessed under the project (para 62), and the resulting investments, if justified, and institutional aspects would then be the object of a possible River Transport Project. Road and river transport freight rates are not regulat- ed, although GPMB sets rates for its own freight movements. However, passenger fares are established by the Government. 36. Transport planning has not been an effective and integrated activity of Government. The Ministry of Economic Planning and Industrial Development (MEPID) does some investment coordination but no detailed transport planning. MWC has a Planning Unit covering all activities of the Ministry. The Unit is headed by an economist who has planning experience but only limited exposure to the transport sector. The unit has for the past five years been assisted by an expatriate advisor, mainly for MWC's building activities and almost all planning information for the sector has been assembled by consultants for project related studies. The future role and staffing of the Planning Unit has been discussed and agreed upon during negotiations in the context of the review of the organization study for MWC (paras 40 and 62). - 11 - 37. Transport sector investment has not always been based on sound economic and technical priorities. Instead, it has been strongly influenced by socio-political factors and donor agency preferences. As a result, a number of transport investments have been either over-designed, premature, or not economically justified. Most of these investments were incurred between FY78/79 and FY81/82, and from FY84/85 to the present, when upsurges in road investments took place. Following a severe deterioration in economic conditions in The Gambia, transport investments will have to decrease over the coming years. Moreover, it is declared Government policy is to reduce the emphasis on transport in favor of other economic sectors and, within the sector, to concentrate on maintenance and rehabilitation. The proposed project will assist the Government through strengthening MWC's Planning Unit in preparing three-year roll-over investment programs based on priorities and studies to determine the needs and economic justification of proposed investments (para 62). During negotiations, agreement was reached on the FY86/87-88/89 transport sector investment program. The Government assurances were also obtained that the three-year roll-over investment programs and annual development and recurrent budgets for the transport sector will be reviewed with the Association by May 1 of each year, up to 1992. Furthermore, agreement has been reached that (i) urgent rehabilitation of transport facilities will be given priority over other transport investments; (ii) new transport investment and rehabilitation will not be undertaken unless adequate economic feasibility studies have been carried out, the estimated rate of return is at least 15Z, and can be funded without recourse to funds for maintenance programs required under the transport sector; (iii) the Association would be consulted before undertaking new investments or rehabilitation in the transport sector that exceed US$500,000 equivalent; and (iv) a methodology would be developed by December 1, 1987, and agreed with the Association, for selecting feeder roads to be upgraded. 38. The treaty that established the Senegambia Confederation in 1982 envisages economic integration between the two neighboring countries. Improvements of some short road sections connecting the two countries are underway under auspices of the Confederation, but they are not expected to significantly affect transport patterns in The Gambia during the project period. Long term effects of the Confederation, on the other hand, could be considerable but will largely depend on agreements for economic integra- tion which are still under discussion. The Roads Subsector 39. The road system does not suffer from capacity constraints and even the 11 Kn Banjul-Serekunda section, which is now being rebuilt as a four lane highway, does not have the congestion normally experienced in capital cities. Ferry capacity at various river crossings can cause traffic delays, but this is primarily due to mechanical failures of fer- ries. The Gambia has about 6,000 motor vehicles, but registration statis- tics are fl-ved. The Government is taking measures to correct this deficiency. - 12 - 40. Road administration of the national network comes under the Directorate of Technical Services (previously Public Works Department-PWD) in MWC, through the Engineering Division which has the technical responsi- bility for design, construction and maintenance of both roads and public buildings; maintenance work is carried out by three provincial divisions (Northern, Western and Eastern). The MWC Planning Unit and the Main Store come under the Permanent Secretary and the Mechanical Engineering Division (MED) comes under the Directorate of Technical Services. MWC's Main Store supplies goods and materials to all government departments, and MED maintains all public vehicles and equipment except those of the Ministry of Agriculture and the Police. The present MWC organization does not permit efficient execution of road and equipment maintenance, or control of operations between the various divisions. Furthermore, the lines of responsibility within HWC and between head office and the provincial divisions are not clearly defined. To enable more efficient and cost effective management of the road network, a study is being completed by consultants to recommend the most appropriate organization, including separation of MWC's buildings and other responsibilities from road maintenance activities, and the role of MWC in transport planning (para 36). The proposed reorganization, which was discussed and agreed upon at negotiations, defines and streamlines the functions, responsibilities and accountability of each division and section in MWC. The enactment of the new MWC structure is a condition of effectiveness. 41. MWC has sufficient professional engineers to manage its opera- tions; however further practical training is planned, under a Kuwait Fund grant, for some of the civil engineers. The Directorate of Technical Services presently has a staff of 959 plus 335 temporary workers. Under an ongoing Government program to reduce the size of the civil service, the Directorate, at the end of 1985, reduced established staff by 77 positions and temporary workers by 441 positions. Several divisions are still overstaffed at semi-skilled and unskilled working levels. The required staffing levels and manpower development needs in MWC are being determined by the reorganization study in coordination with the ongoing ODA sponsored study on the reform of the entire civil service, which is scheduled to be completed by June 1986. Preliminary estimates for a reduction of the employment force of MWC were discussed at negotiations, and it was agreed that target levels for the staff reductions will be worked out in line with the civil service reform. 42. Training operations are being conducted both internally, and at local training institutions in the Banjul area. These activities are coordinated by the Chief Engineer (Engineering Division) with assistance provided by consultants under the First Project and the USAID project (para 43). In-house training is centered around road maintenance activities, and equipment and workshop management. In October and November 1985, MNC's Deputy Chief Engineer and Training Officer participated in a seven-week course, run by the ILO Training Center in Italy, Kenya and Tanzania, financed under the First Project. During the course, an outline training program for IMC was prepared by the two participants. In addition, MNC personnel attend courses at The Gambia Technical Training Institute (GTTI) - 13 - and the Management Development Institute (MDI) on a released time basis. Some of the GTTI courses are recognized in the United Kingdom and lead to London City and Guilds Certificates. A major constraint to training is extensive illiteracy at middle to lower staff levels. This issue is being reviewed by IDA with the Ministry of Education regarding the development of an in-house functional literacy program. The Second Project's training component will support the continuation of ongoing activities with emphasis on strengthening MNC's interbal training capability, as well as at GTTI and MDI (para 61). 43. Equipment management is the main responsibility of MED. The centrai workshops, presently located near Banjul port in old flying boat hangers, will be relocated in mid-1986 to a new facility, financed by USAID, at Kotu about 14 km from Banjul. Consultants are preparing proce- dures for equipment, workshop and stores management and will train local staff and workshop instructors until the end of the USAID project in September 1986. However, this will not provide sufficient training for efficient management practices to be sustainable, and further assistance will be piovided under the project (para 50). To date, MED has not been authorized' to charge fully for its services to the various government agencies. *A realistic charging system for mechanical services to enable MED to function efficiently is being worked out by MWC and the USAID consultants. During negotiations agreement was reached on the principles of MED's charging system; the detailed list of charges will be submitted for the Association's approval by June 1, 1986. Government's publication of the charges to be paid to MED, together with adequate budget alloca- tions, are a condition of ffectiveness, with implementation to start by July'1, 1986, the beginning of the Government's fiscal year. 44. Accounting and internal auditing procedures have basically been adopted from the British system. There are, however, negligences and inefficieucies in the follow up of the required procedures. Some training in cost accounting was provided under the First Highway Maintenance Project but further improvements are needed to consolidate the achievements and to ensure accuracy and timely availability of pertinent information on such matters as spending authorized through the approved budget. Consultants under ongoing projects are installing systems for inventory control, stores accounting, workshop job costing, and cost and performance accounting for routine and periodic maintenance. These are simple systems which will be adapted under the Second Project for microcomputer use. Assistance to install, operate and train staff in financial and cost accounting procedures will be provided under the project (para 59). MC's Internal Audit Branch functions directly under the Ministry of Finance and Trade. Its functions are to detect errors and lack of reliability of accounting records and to ensure that Government procedures are adhered to. However, MMC lacks sufficient qualified staff to carry out the above tasks efficiently. The computerization of records together with on-the-job training and courses at MDI under the project should enable a small staff of accountants and cost clerks to perform adequately. - 14 - 45. Revenue from road users is collected from taxes on fuel, lubri- cants, vehicle and spare part imports, and annual licenses. Fuel and vehicle import taxes provide the bulk of the revenue. All revenue goes to the national treasury. As a result of increases in internal prices, because of devaluation, and shortages in local supplies, because of foreign exchange shortfalls, fuel consumption has been decreasing since its peak in 1980. Although no annual traffic counts are available, traffic levels have undoubtedly declined over recent years. Road user taxes yield more than is required for road maintenance and overall road investment, including new roads. No additional efforts are therefore required for resource mobiliza- tion purposes, but a better allocation of scarce resources is needed as outlined in paragraph 37. 46. Road financing is provided through the recurrent budget, the development budget and external loans and grants. The recurrent budget finances expenditures for road maintenance. Because the various functions of MWC are not clearly separated, data on road maintenance expenditures are not precise. However, since FY77/78 the annual budget for supplies and contracts has steadily declined. The First Highway Maintenance Project financed all costs (including wages) for regravelling and resealing works. Under the Second Project, the Government's participation in routine maintenance will be increased from mid-1987 (para 69). MWC staff salaries come under a separate heading in the recurrent budget. At negotiations, agreement was reached that the Government will modify the recurrent budget presentation by providing separate budget allocations for each MWC division, and will provide sufficient funds to undertake adequate annual road maintenance programs. 47. Transport sector rehabilitation and new construction projects are financed mostly by loans and grants, with local funds provided from the development budget. Development budget levels are determined by the Ministry of Finance and Trade and have been governed more by the availability and amount of foreign financing than priorities within and between sectors. Over 40% of the development budget has, in the recent past, been allocated to transport projects. Bank economic missions are currently discussing with the Government the need to reduce overall public investment levels and to change sectoral distribution for the three-year period commencing FY86/87. It is expected that less funds will be available for the transport sector and efforts need to be made for more rational allocations as outlined in paragraph 37. IDA Involvement in the Transport Sector 48. The Bank Group has financed three projects in the transport sector: the First Banjul Port Project (Credit 187-GM, US$2.1 million, May 1971), a Highway Maintenance Project (Credit 897-GM, US$5.0 million, March 1979), and the Second Banjul Port Project (Credit 1266-GM, SDR 5.9 million, September 1982). The First Port Project was satisfactorily completed in late 1975, while the civil works under the Second Port Project were sub- stantially completed in 1984. The'project costs are within the estimates, but land reclamation works have been delayed because of unstable - 15 - foundations and will not be completed until mid-1987, about 18 months beyond the original completion date. The delay will not unduly affect port operations. 49. Execution of the First Highway Maintenance Project proceeded reasonably well, and the objectives of the project have been met satisfac- torily or exceeded. The project was substantially completed in early 1986, two years after the original completion date. The First Project consisted of a four-year maintenance program, including routine maintenance of 780 km of roads, regravelling of 190 km of major laterite roads, and studies for a follow-up maintenance program and for exploration of locally occurring aggregates. The routine maintenance component has been successful in prolonging the life of the existing paved road system. The regravelling works have resulted in upgrading of important sections of the North Bank Road. A small resealing unit was set up in 1983 and will complete some 22 km under the First Project. This operation, which was outside the original project description, has been successful in salvaging a number of short sections of roads especially in the Banjul area. Overall, the conditions of the primary and secondary roads have not further deteriorated since the start of the First Project, and the regravelled and resealed roads are in much better condition than before. 50. Fifteen cost clerks have received formal training locally and two workshop personnel were sent for courses in the U.K. under the project, while on-the-job training was provided for the staff of the regravelling and resealing units as well as for 20 road foremen. At the start of the project there were no Gambian engineers in 4WC below senior management level. The recent return of seven new civil engineering graduates should enable eventual institutional sustainability of road maintenance operations. 51. The main problems which delayed the project were outside the control of MWC. The Government's insistence that spare parts and supplies be procured through local suppliers, who carry little or no stock, resulted in prolonging the down time of equipment requiring repairs. Shortage of local funds compounded the difficulties. The procurement problem will be addressed under the proposed project through the use of international shopping (para 68), and funding constraints will be alleviated by the setting up of a revolving funds for IDA and Government funds (paras 71 and 72). PART IV - THE PROJECT 52. The project was originally prepared under the First Highway Maintenance Project. An advance of US$550,000 in the form of a Project Preparation Facility (US$200,000 in July 1985 and a further US$350,000 in December 1985) was granted to complete project preparation. Negotiations were held in Banjul, February 5-12 1986. The Gambian delegation was headed by Mr. Abdou N'Jie, Permanent Secretary, MinIstry of Economic Planning and Industrial Development (MEPID) and included representative from MWC and the - 16 - Ministry of Finance and Trade. Supplementary data on this project are pre- sented in Annex III. Project Objectives 53. The main objective of the project is to support MWC in carrying out a four-and-one-half-year (1986 to mid-1990) road maintenance and upgrading program comprising: (i) continuation and expansion of the road maintenance program initiated under the First Project; (ii) rehabilitation of the highest priority sections of the paved network; (iii) strengthening of the organization and management of MWC to improve the efficiency of road and equipment maintenance; (iv) introduction of sound transport planning procedures; and (v) assistance to domestic contractors to enable their more effective participation in road maintenance activities. 54. The IDA role in the highway sub-sector has been expanded through intensive dialogue on all aspects related to the management of the road network, and has stimulated the Government to make substantial improvements in the organization of the subsector. Also, IDA is now planning a more active role in overall transport sector issues and priorities. Continued Bank involvement in the subsector would therefore be justified and would (i) contribute to strengthening the Government's resolve to address priority maintenance and rehabilitation programs, (ii) improve management capability in the sub-sector and (iii) encourage donors to support the infrastructure maintenance and rehabilitation needs of the country. Project Description 55. To assist in fulfilling the objectives, the project would provide financial assistance for (a) Road Maintenance Program: (i) regravelling, resealing and routine maintenance of the national and local road networks; (ii) experimental low-cost paving of gravel road sections; (iii) equipment and vehicles; and (iv) road maintenance and workshop management assistance; (b) Road and Bridge Rehabilitation: (i) reconstruction of Bund Road (3.5 km), and strengthening of deformed sections along 150 km of the South Bank Road; and (ii) reconstruction of Brumen Bridge; (c) Institutional Strength- ening: (i) technical assistance to MWC for implementing its reorganization, for transport planning and studies, and for auditing; (ii) training program for MWC staff; and (iii) technical assistance and training for domestic contractors. The Road Maintenance Progra* 56. Routine road maintenance operations presently come under the responsibility of MWC's provincial divisions. The length of roads to be maintained by MWC will increase from the present 780 km to about 1,300 km under the Project, comprising about 450 km of paved roads and 610 km of gravel roads of the national network, as well as 45 km of paved local roads in Banjul City and Kanifing Urban District and about 200 km of gravel local roads which have national luiportance. The most appropriate organization and methodology for carrying out labor-based routine maintenance operations - 17 - will be tested under a two-year pilot project with ILO (SIDA financed). This project started in early 1986, and will include maintenance of some 60 km of paved and 50 km *of gravel roads south of the Gambia river. Two systems will be tested: (i) a lengthman system where 3 to 5 km would be allotted to a person living nearby; and (ii) a petty contract system where local communities would organize themselves into working gangs. The pilot project would also test the use of tractor-towed graders for smoothing low-trafficked gravel roads. The effectiveness and cost of these operations will be monitored and compared with MWC's present procedures of manual gangs travelling daily to work sites from the regional offices. The preliminary results of the three systems will be reviewed jointly by MWC, ILO, EEC, UNSO and IDA by June 1, 1987. This agreement was confirmed at negotiations. Any modifications to MWC's routine maintenance practices and equipment needs (para 63) would be incorporated into the annual road maintenance programs from July 1, 1987. 57. Periodic maintenance of national roads would continue to be carried out by MHWC with continued managerial and technical assistance by consultants engaged under Ithe First Highway Maintenance Project. All periodic maintenance activities are presently carried out by force account, except for some petty contracts for the extraction and supply of cockle shells for resealing works. Under the project about 260 km will be regravelled, 100 km resealed and a further 130 km fog sealed. The periodic maintenance program would enable MWC to catch up on the work back-log and to initiate systematic monitoring of road conditions and scheduling of timely regravelling and resealing operations. 58. Renewal and Operation of MWC's Road Maintenance Equipment. Regravelling, resealing and mechanized road maintenance operations will be carried out with MWC's existing equipment. Past budget constraints and foreign exchange shortages have not permitted replacement of aged units since the start of the First Project, when some new equipment was procured and overhauls were carried out with assistance of consultants. Equipment and vehicles, including initial stocks of spare parts, will be procured in two batches under the project. The first batch will fill present gaps in the fleet and replace aged units. The second, to be carried out after the June 1, 1987 reviews of labor-based maintenance procedures (para 56) and contractor participation in road maintenance (para 63), will replace additional aged units. Consideratinn will also be given to the availability of UNSO equipment which is presently being used for their feeder roads upgrading program in the Northeast. Spare parts, fuel, tools and other imported materials required for road maintenance operations will be procured under the project using international suppliers where appropriate, to avoid the recurrent shortages in the local market experi- enced under the First Project, and to ensure more efficient use of equip- ment. 59. Road Maintenance and Workshop Management. In order to continue the training of MWC staff in all areas of road maintenance management and operations, the consultants financed under the First Project will continue their services (125 -rm) over the project implementation period. The team -18- will also include an accountant to assist in streamlining KWC's financial accounting procedures and to firmly establish the costing system developed under the First Project. In order to follow up on the USAID project, MWC will also engage two specialists (25 a-m) to assist in managing the new central workshop under MED and in running related training programs. MED's main counterparts would be the senior mechanical engineer and the stores superintendent who would receive on-the-job training. The technical assistance would actively assist MWC staff in managing the road and equip- ment maintenance operations up to mid-1988, after which assistance would be limited to short-term visits over the remaining project implementation period. The terms of reference and counterpart staffing were agreed at negotiations. Road and Bridge Rehabilitation 60. Highest priority road sections along 150 km of the South Bank Road will be strengthened under the project. In addition, the 3.5 km Bund Road, which links Banjul Port to the South Bank Road, will be reconstructed. The 117 m long, single lane, Brumen Bridge, built 20 years ago, is in poor condition because of deterioration of the concrete super- structure. Under the project the piles will be strengthened, the superstructure will be rebuilt to higher standards for heavy truck traffic, and the deck widened to two-lane (9-10m) width. Institutional Strengthening 61. Technical assistance (23 r-r) will be provided to assist WC in implementing efficient management procedures under its new organization (para. 40), and in preparation of reporting and monitoring requirements at the different management levels. Training assistance (6 Vr-u) will have two major objectives: (i) to improve MWC management and use of personnel through the development of effective personnel management policies and procedures; and (ii) to improve MWC management capability and staff productivity through various training and upgrading programs. MWC's Training Officer will be assisted in preparing details of the training program by March 1, 1987, and in monitoring its effectiveness through periodic visits during the project.implementation period. The project will also provide equipment, materials and supplies for upgrading MWC's offices and for in-house training, and training at GTTI and MDI; support tuition costs for selected GTTI and MDI courses; and finance expenses for overseas seminars and work study tours for professional staff. The Personnel Development Program for MWC and terms of reference for management and training assistance were agreed at negotiations. 62. The future role and functions of MWC's Planning Unit is being determined under its reorganization. The Government's transport planning capabilities require strengthening and 36 r-rn of assistance will be provided under the project. Additionally, studies required to assess the economic role of river transport in The Gambia will be carried out under the project (para 35). The function of MWC's Planning Unit and outline terms of reference for technical assistance were agreed at negotiations. - 19 - 63. Domestic Construction Industry. In order to have a better knowledge of the physical and financial capacity of the small domestic construction industry, a consultant (4 a-m) will be engaged to (i) undertake a six-week study and recomnend a plan of action to utilize more effectively private firms in road and building maintenance activities, and (ii) conduct courses and assist domestic contractors in improving their efficiency and cost control. The study will be completed in early 1987, so that MWC would be able to determine its future equipment requirements for road maintenance. During inegotiations, the Government confirmed its commitment to increase the use of contractors in road maintenance activi- ties and agreement was reached on the terms of reference for the study and trainiig of domestic contractors. Project Cost Estimates and Financing 64. The estimated total cost of the project including MWC salaries and wages, and contingencies, is US$16.4 million equivalent. No duties or taxes are to be levied against project items. except for those paid by domestic contractors engaged in road maintenance activities. The foreign exchange domponent is about US$13.2 million, or 80% of the total cost. Base costs,have been estimated at February 1986 prices. Physical contingen- cies average about 3% of base- costs, and comprise 1OZ for road and bridge rehabilitation and 5% for institutional strengthening. In accordance with normal practice, no physical contingencies are included for the road maintenance program which covers a four-and-one-half-year (1986 to mid-1990) time slice. Price contingencies average 17% of base costs plus physical contingencies, and are based on estimated foreign inflation of 7% for 1986 and 1987, about 7.5% for 1988, 7.7% for 1989, 7.6% for 1990, and 4.5% for 1991 onwards. Estimated rates of inflation on foreign costs have been applied to both foreign and local costs. This assumes that the exchange rate (taken as US$1.0 = Dalasis 3.2 for base cost estimates) will be adjusted for divergences between foreign and local rates of inflation. Overall, about 220 i-m of technical, management and training assistance will be provided under the project.. Consultants will also supervise civil works contracts and carry out transportation studies. 65. The project will be externally financed by: IDA (US$5.8 million equivalent), AfDF (US$4.5 million equivalent), EEC (US$2.0 million equiva- lent) and UNDP (US$0.7 million equivalent). UNSO would cofinance feeder road maintenance during calendar 1987-88 (US$0.6 million equivalent). SIDA has separately provided US$120,000 equivalent for the ILO executed pilot routine maintenance project. IDA will retroactively finance up to US$300,000 for expenditures - incurred from January 1, 1986 for the road maintenance program. External financing for periodic and routine maintenance will cover 60% of total direct implementation operating costs over the project period. The Government's contribution to the project will amount to US$1.5 million equivalent for local expenditures and US$1.3 million equivalent for MWC salaries and wages. External financing will cover 80% of total cost or 90%, excluding wages and salaries. Cross effectiveness conditions have been provided with EEC, UNSO and UNDP. - 20 - Present Status of Proposed Project and Implementation 66. The Permanent Secretary of MPW will have overall responsiblity for implementation of the Project, with the Director of Technical Services providing coordination of the maintenance program, road and bridge rehabilitation and MED's workshop management. Road maintenance, upgrading and rehabilitation will be executed by the two new Roads Divisions (East and West); workshop management comes under MED and training would come under the new Administrative Division to be established in MWC. The Permanent Secretary will directly oversee the transport planning component. The road maintenance program has been fully prepared. Detailed engineering for reconstruction of Bund Road and Brumen Bridge is underway and preliminary cost estimates have been prepared. Because of the nature of the South Bank Road strengthening (para 60) detailed surveying and design will be carried out immediately prior to executing the works; quantity estimates and specifications will be prepared by mid-1986. Rehabilitation of Bund Road and the South Bank Road could be carried out under one contract. The project is expected to be effective in July 1986 and to be physically completed by June 30, 1991, which allows for a 12 month slippage in executing the four-and-one-half-year maintenance program. Procurement 67. Procurement arrangements are summarized as follows: Amounts and Methods of Procurement a/ (US$ Millions) Procurement Method Total Project Items to be Procured ICB LCB Other NA b/ Cost Equipment and vehicles and 1.7 - 0.4 - 2.1 initial stocks of spare parts - - (0.4) - (0.4) Road maintenance and paving c/ 0.3 0.4 3.9 1.3 d/ 5.9 (0.2) (0.1) (2.8) - (3.1) Road and bridge rehabilitatirn 4.6 - 0.4 - 5.0 Technical assistance, studies and training - - 2.9 - 2.9 (1.8) - (1.8) Refinancing PPF - - - 0.5 0.5 (0.5) (0.5) Total Project 6.6 0.4 7.6 1.8 16.4 (0.2) (0.1) (5.0) (0.5) (5.8) a/ Amounts financed by IDA are in parentheses. b/ Not applicable. c/ Spare parts, fuel, lubricants, tools, petty contracts and materials. d/ MWC salaries and wages. -21 - 68. Procurement of equipment, vehicles, non-proprietary spare parts and bitumen products will be carried out under ICB in accordance with Bank guidelines. Contracts for supply of goods and materials estimated to cost less than US$10,000 equivalent (except for fuel), up to an aggregate of US$200,000 equivalent (except for fuel), may be procured through local shopping. Equipment and spare parts of a proprietary nature or subject to standardization may *be procxred with prior IDA agreement on the basis of price quotations from at leasc three qualified suppliers, with at least two of them operating internationally. Contracts for road maintenance activi- ties up to US$100,000 may be awarded on the basis of competitive bidding advertised locally. Petty contracts (under US$10,000 equivalent) for road maintenance activities would be negotiated, based on procedures and unit rates established with assistance of the road maintenance consultants. Consultants for technical assistance will be appointed in accordance with Bank guidelines. Force account operations will be permitted for road maintenance and low-cost paving works. All transactions in excess of US$50,000 equivalent will be subject to prior approval by IDA. Disbursements 69. Although the project covers a four-and-one-half-year time slice, disbursements are estimated to follow the historic disbursement profile for highway projects in West' Africa, i.e. six years, as was the case under the First Project. However, initial disbursements will be greater than historic levels due to refunding of the PPF advance and the initial advance into the Special Account (para 71). The credit is expected to be fully disbursed by March 31, 1992. IDA financing of road maintenance activities would be progressively reduced from mid-1987 with consequential increases in MWC's road maintenance budget. The IDA Credit would be disbursed against the following categories, and on the basis of the estimated disbursement schedule: - 22 - Allocation and Disbursement of IDA Credit IDA Amount Percent Category Description (US$ Millions) Financed 1 Equipment and vehicles (including initial stock of spare parts), office supplies and mater!ala 0.40 100% 2 Road maintenance and paving; direct operating costs, excluding salaries and wages: 2.70 Expenditures before July 1, 1987 100% Expenditures between July 1,1987 & June 30,1988 80% Expenditures thereafter 60% 3 Technical assistance, audits, studies and training 1.65 100% 4 Refunding of PPF Advance 0.55 Amount Due 5 Unallocated 0.50 Total 5.80 70. Disbursements for routine road maintenance, regravelling, reseal- ing and low-cost paving works will be made against statements of expendi- tures (SOE's) using unit rates for each work item in accordance with the agreed program. Unit rates for force account activities have been estab- lished under the First Highway Maintenance Project for direct operating costs (field salaries and'wages, equipment operation and maintenance, and materials) equipment amortization and overheads. The unit rates will be updated and agreed with IDA on a quarterly basis. For contracted activities, the applicable contract rates will apply. Other disbursements will be made against standard documentation. The udit rates for the road maintenance program to be used from the start of the project for disbursement purposes were agreed at negotiations. 71. A revolving fund will be established for IDA funds in a Special Account opened in foreign currency in the Central Bank of The Gambia. An advance of US$400,000 from IDA funds into the Special Account will be made after the Declaration of Effectiveness, to cover about four months of project expenditures. Disbursements may be made from the Special Account for all project expenditures eligible for IDA financing. The Special Account will be replenished following applications for reimbursement by MWC, together with appropriate supporting documentation or SOE's, as well as bank statements. Reimbursement applications will be submitted to IDA - 23 - whenever accumulated withdrawals amount to US$100,000. The amount of IDA replenishment will not exceed the authorized allocation. 72. Counterpart funds will be made available by the Government through its budgetary allocations. A revolving fund for local supplies and petty contracts will be established for counterpart funds in a Project Account to be administered by the Accountant General. An initial deposit of Dalasis 40,000 will be made by the Government before IDA advances the initial deposit in the Special Account. 1WC will prepare, one month prior to each quarter, a work program and related .stimates of expenditures for project execution during the forthcoming quarter. The required counterpart funds will be deposited by the Government into the Project Account before the end of the first month of each quarter. IDA replenishments of the Special Account will be conditional on the Government having deposited the required counterpart funds into the Project Account. Only eligible project expenditures will be made from the Project and Special Accounts. MWC, with assistance of the road mai1tenance consultants, will manage all accounting records and MWC will prepare supporting documentation and SOE's. Reporting and Auditing 73. Quarterly progress reports will be prepared by MWC with the assistance of consultants and sent to the Association within one month after the end of each quarter. These reports will include: (i) progress achieved against the agreed implementation and disbursement schedules, and key performance indicators; (ii) work programs and cost estimates for the coming quarter (para 72); and (iii) statements for the revolving funds. External auditors acceptable to the Association will be engaged under the project to carry out annual audits of the project as well as the Project and Special Accounts in accordance with the Bank's Guidelines for Auditing. Each Audit Report, together with a management letter, will be sent to the Association not later than six months after the end of the fiscal year. The reporting and auditing requirements were agreed at negotiations. Nature of Project Benefits 74. The present deterioration of the highway Isystem under the juris- diction of MWC does not yet impose serious restrictions on transportation. The maintenance program, however, is urgently needed to protect the highway investment, and to prevent further deterioration in road conditions which would cause physical bottlenecks in transport in the near future and would also necessitate larger future investments for road rehabilitation. Since the costs of potential transport bottlenecks are difficult to estimate, the project benefits quantified are mainly in the form of savings in road maintenance and road user costs generated by the project. Other benefits, such as time savings or positive effects on agricultural supplies and production because of reduced transport costs have not been quantified. 75. Traffic volumes for the various roads are mainly based on traffic counts made in 1982; average daily traffic (ADT) in 1984 is assumed the same as 1982 ADT, as economic activity remained stagnant during this - 24 - period. An annual growth-rate of 5% has been assumed for future years which is in line with the recovery scenario recently outlined in the Bank's report on the Development Issues and Prospects for The Gambia. The economic return calculations for the maintenance program were tested for a zero traffic-growth assumption. Traffic on the project roads is not expected to be influenced *by the Senegambia Confederation during the project period. Economic Returns and Sensitivit 76. The economic benefits of the project have been calculated for all main components: maintenance of gravel roads, maintenance of paved roads, rehabilitation of 150 km of paved road sections and the Brumen bridge. The internal economic rate of return (ERR) on the gravel road maintenance component is estimated at 28%. The maintenance component for paved roads has a much higher economic justification owing to the greater state of deterioration of the roads and higher traffic volumes. The estimated ERR on this component is 70%. The estimated ERR on the entire maintenance program for the paved and gravel road network covered under the project is about 39%. The rates of return were tested for a shortfall in benefits by 20%, an increase in cost by 20% and a zero percent traffic growth. The resulting estimated ERRs are 25%, 272 and 28%, respectively. 77. Pavement strengthening of sections of the South Bank Road, the principal overland link with the interior of the country, is of high priority. The road sections are in fair to poor condition and without any strengthening will continue to deteriorate rapidly. The sections to be improved carry traffiq volumes of 1,800 vehicles per day (vpd) for Yundum-Brikama (10 km) and 540 vpd for Bajana-Kalagi (100 km) and 4.80 vpd for Kalagi to near Soma (40 km). Thg combined ERR for these road sections is 34%. The Bund road carries some 1,900 vpd. It bypasses Banjul's city center for most traffic to and from the port and ferry, and has been designated as the official truck route to the port. The road is in poor condition and stretches are subject to periodic flooding. The estimated ERR for the improvements of Bund Road is about 322. If the Brumen Bridge is not improved soon, its rapid deterioration will lead to severe load restrictions and probably to a disruption of road service. The ERR on this investment is estimated at 49%. 78. The composite ERR from total project investments, excluding technical assistance for institutional strengthening which could not be allocated to particular road programs, and excluding PPF advance which is treated as a sunk cost, is estimated at 38%. These quantified components cover 79% of total project costs. Project Risks 79. Based on the satisfactory implementation of the First Highway Maintenance Project and the commitment of the Government to reorganize MWC and improve its management procedures, there would be no major risks concerning project implementation. However, further aggravation of The - 25 - Gambia's economic situation could limit funds for road maintenance. The Association will annually review the road investment and maintenance programs and agree on budget levels for the annual road maintenance pro- gram. A second risk concerns the extent of the Government's long-term commitment to institution building. A weakening of Government's decision to streamline existing procedures in MWC and to delegate responsibilities to line managers would not unduly affect implementation of the project but would extend the period needed for expatriate technical assistance. Through careful monitoring and follow-up, the Association will try to reduce this risk. Moreover, an important element of institutional strengthening is the strong technical assistance support to implement the project over the first two years (para 59), and to train engineers, planners, managers and techni- cians in their tasks. This will, in itself, enhance the overall management efficiency of MWC, and will facilitate the establishment of sustainable operational procedures. PART V -'RECOMMENDATION 80. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association and recommend that the Executive Directors approve the proposed credit. A.W. Clausen President Washington, D.C. March 5, 1986 -26 - Page I of 6 CMKlA. TE - sociAL niOCA1"s a su MmEAø. To fFIumE GMOUPS (IHITmD aMAGs) ja Mn Dns aT Smans) Lb a~CM LOU IMCOM AFRCA ~10La l"COM 19aL 1970Lk saui£A ia ur ai AtC#, . up nm små ceusa s. Ma 11.3 11.3 lI.. AIMLi~M 3.5 3.9 4.3 an sanar (us> .. .. 290.0, au.s 10u3. a- "M m u Ns.O Ma.G & (Ka ~u Or OIL OqewsALT) 16.0 33.0 78.0 62.3 58.5 menu - via smUas lpo ~ATto.0-na (T 0U9SAS) 374.0 465.0 697.0 gas 90UAlm (x OT UTAL) 12.6 19.8 30.0 20.1 32.0 Pf~ILATION NUOIICTIONU P~nm K WAS 2000 ( n.l.) - 1.1. nTrAimæ UATU (a.) 3.2 PanLUTue -eei 1.9 FO~tATIO DMIT ru go. m. 33.1 41.2 01,7 33.2 95.1 rm1 50. M. AMt!. LAND 105.9 119.2 158.4 112.8 124.8 0P~1TZM AGIL STECTRE (X) 0-14 Tin 42.7 43.9 4L4 46.0 45.6 15-64 w 54.2 53.1 55.3 50.8 51.5 65 AM A~ , 2.9 2.9 2.2 2.9 2.7 ForA0U MSmi G~TE () TOTAL i 1.2 2.2 3.1 2.6 2.9 05A55 2.8 7.1 6.5 6.4 5.1 CoDE UEmEN "ATE (PC& IOS) 46.3 46.2 49.0 47.2 47.0 emD 0~t oAmE (Mt ~n0S) 29.2 26.1 22.7 17.8 15.0 Csams REPRnoCTIOW rAT 3.0 3.1 3.2 3.3 3.2 - FANLr PLAM=IIG ACCu~s, Ai (THaUB .. 1.0 11sm$ (o sF van > .. .. 5.0 3.3 6.4 tne (r TOOD r. n CAPITA (19t9-71-100) 101.0 98.0 62.0 83.3 82.9 nE CAPITA SUPPLY ar CALOUIES (%W MQUIRERMS) 109.0 98.0 86.0 s7.7 9.5 MOTEmS (GAhs PIU DA) 63.0 56.0 51.0 51.9 55.4 O biC ADIAL AND MULME 11.0 13.0 13.0 .e 1.7 10.5 CRIJ (AC 1-4) 0E25 aTE 53.9 52.3 45.5 23.1 16.0 LIE UEPCT. AT 1aM1 (TEAM) 31.1 32.3 36.0 47.8 52.0 nwANT "MT. &ATE (E TieUS) 122.0 216.5 200.0 119.5 10B.8 ACCESS to SAFE UATER xU~uL .. 3.0 .. ~ 19.3 35.6 ACCs To Es & DISTsAL (< OF PPUATINI) TOTAL .. .. .. 26.5 28.9 UMA~ .. .. .. 65.4 57.7 xUAL .. .. .. 20.8 20.7 POPLfATION "a PHmSXCIA~ 24930.0 23950.0 12310.0 /a 27901.7 11791.7 PP. r mUuiISm pemmN 1590.0 /t 18960.0 1770.0 W 3308.4 2459.8 POP. na "UTAL Em TOTAL 920.0 .. 860.0 le 1273.6 981.1 U- 190.0 /f .. 170.O - 428.2 368.8 t~ r. 9210.0 /t .. 3890.0 3292.5 437i.1 ADMSSIX5 PER HSPITAL UD .. .. .. .. 27.2 AVERM SIZE OP IMSEMOLD TOTAL .. .3/ .. Unse .. ~6.1 W .. .. AuL. 9.0 Tb-Ft..U.. .. AVE~P 60. er M ~S v~/00 TOTAL . fUeA ........ RUEAL. ........ tmæmaE OIP OLLu~C VITK WLET. TOTAL .. ROKAL .. MA ........ -27- NNEX I Page 2 of 6 CAIBIA. THE - SOCIAL INDCATOS DATA SenlT GAmnA. TmE REUENCE GROUPS (IQNTED AWERAWS> MsT 193.0 227.0 331.0 pENAE (PERCE)T 46.8 46.2 43.1 34.2 36.2 ACRICULTUR9 (PECENT) 85.0 82.0 70.0 /1 77.5 54.5 INDUSTIZ (PERCE 7.0 ".0 9.0i 9.7 18.3 PARTICIPATION RATE (PEaCEaT) TOTAL 51.7 48.7 47.5 39.3 36.8 KALE 56.2 53.5 53.6 /d 50.9 47.1 ' PE1ALE 47.4 44.2 41.8 72- 21.1 27.2 ECoNfC DEPENDENC Y ATIO 0.9 1.0 0.9 1.3 1.3 P6r1UT OF PRIVAT! IlCe RimmD a IIIEST 5% OF arouEILS .. KlG~EST 201 OF IOUSEHOLDS .. LalEST 201 OF MOUSEMGLDS .. LOUST 402 OP OUEGLDS .. . ron~ T E GR-UP EST~ATED ABSOLUTE ro1ERTm 1N1E LEEL (USS PER CAPITA) URBAN .. .. .. 165.5 590.7 RURAL .. .. 95.0 l 95.0 275.3 ESTD D 9TAIrm Pmew mcm LEVEL (USS PER CAPITA) URAm .. .. 185.0 le 113.1 545.6 RiftAL .. .. 90.0 67.6 201.1 ZSTIKATED POP. ELW ABSOLUTE POSEfl= 1NCDME LEVE. <2> URSAR .. .. .. 36.6 RIUA1. .. .. 40.0 l 61.8 NO? AvAIlAoL. NOT APPLICASe NOT I S The grcp avragas for sach imdtcator are populaL-oagted arithmtic mas. Covora of c%acrlcs amog CMh indlcotors dapeads m vallabIlity of data and la not muform. /b Unlchs othwlse notsd. "Dta for 1960" retar to au yar brmn 1959 and 1961; "Data for 1970" betusa 1969 and 1971; and data for "M~st Ka~nt Estiasta" beten 1981 and 1983. 1977; d 1980; m 1978; I 1962; J 1976: a 1973; t 1984. .UNE. 1985 ANNEK I - 28 - PageS 3of 6 DsFINrIONS OF SOCIAL INDICAIRS Noe Although the data ame drawn from sources gmrallyjudmd the most authontative and reliable. it should also be soted that they not be intenationaly comparable becaue of the lack or stsadardlad denutions and concepts used by dilermt counties in collecing the deats. The data are. nonetheless. useful to dtscuibe orders of magnitude. Indicate trends. and charscterim certain major differenocm between countries. The reference groups are (1) the same country group or the subject country and (2) a country group with somewhat higher average mncome than the country group of the subjec country (scepit for -High Income Oil Eaportera" group where -Middle Income North Ato and Middle East" is chosen becaue of stronger socio-cultural affities). In the afkienoe group data the averages are population weighted anthmetic means for each indicator and shown only when majority of the countries in a group has data for that hidicator. Shce the coverage of countries among the indicators depends on the availability of data and as not uniform. caution must be esrisld In relating averages of one indicator to sanother. Theme averages are only useful in comparing the value atone indicator at a ame among the country and refemnce groups. AREA (thousand sq.km.) Crude Bith Rate (per tkousdj-Number of live births in the year Tera-Total surface area comprising land area and inland waters; per thousand of mid-year population; 1960.1970. and 193 data. 1960. 1970 and 1983 data. Crd Death Rate (per thaisted)-Number of deaths in the year ASrikawral-Estimale of agricultural area used temporarily or per thousand of mid-year population; 1960. 1970. and 1983 data. permanently for crops. pastures. market and kitchen gardens or to Gross Repwefacnli Rak-Average number of daughters a woman lie fallow, 1960. 1970 and 1982 data. wilt bear in her ma rqjroductive period if she expi present age-specific fertility rates; usually five-year avenages ending GNP PER CAPITA (USSHGNP per capita estimates at current in 1960, 1970. and 1983. market prices, calculated by same conversion method as World F Phussicceptos Annual (Arsdmh-Annual num- Bank Atlas (1981-83 basis); 1983 data. her of acceptors of birth-control devices under auspices of national ENERGY CONSUMPTION PER CAPITA-Annual apparent family planning program. consumption of commercial primary energy (coal 'and lignite. Famsy PbauM-sers (percent efmauried wiw)- The peren- petroleum. natural gas and hydro-. nuclear and geothermal elec- tap of married women of child-bearing age who are practicing or tricity) in kilograms of oil equivalent per capita; 1960. 1970. and whose husbands ar practicing any form ofcontraception. Women 1982 data. of child-bearing age ar generally women aged 15-49. although for some countries contraceptive usage is measured for other age POPULATION AND VITAL STATISTICS groups. Total Populotee. Mid-Year (thiusmars)-As of July 1 1960. 1970, FOOD AND NUTRION and 1983 data. Uris ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ne fplt.(pretotta-Rtoouratottl uesiof Fad Arediardan Per Capita (196 9-71 - 100) -Index of per Urdafs erent fnition of ura t coa capita annual production of all food commodities. Production population; excludes animal feed and seed for agriculture. Food commodities ability of data among countries 1960. 1970. and 1983 data. include primary commodities (e.g. sugarcane instea-F of sugar) -OEM)O Pmjecrioa which are edible and contain nutrients (e.g. coffee and tea are Pbpulation in Year 2000-The projection of population for 2000. excluded) they comprise cereals, root crops. pulses. oil seeds. made for each economy separately. Starting with information on vegetables, fruits, nuts, sugarcane and sugar beets, livestock, and total population by age and sex. fertility rates. mortality rates. and livestock products. Aggregate production of each country is based international migration in the base year 1980. these parameters on national average producer price weights: 1965. 1970. and were projected at five-year intervals on the basis of generalized 1982 data. assumptions until the population became stationary. Per Capita Supy ofCakies ereen e-quaresesss)-Comput- Stationary population-Is one in which age- and sex-specific mor- ed from calorie equivalent of net food supplies available in country tality rates have not changed over a long period. while age-specific per capita per day. Available supplies comprise domestic produc- fertility rates have simultaneously remained at replacement level ton. imports lcs exports, and changes in stock. Net supplies (net reproduction rate = 1). In such a population, the birth rate is exclude animal feed, seeds for use in agriculture, quantities used in constant and equal to the death rate. the age structure is also food processing, and losses in distribution. Requirements were constant. and the growth rate is zero. The stationary population estimated by FAO based on physiological needs for normal activity size was estimated on the basis of the projected characteristics of and health considering environmental temperatur. body weights. the population in the year 2000. and the rate of decline of fertility age and sex distribution of population. and allowing 10 percent for rate to replacement level. waste at household level: 1961. 1970 and 1982 data. Population Mornentum-Is the tendency for population growth to Per Caia Susply of Protein (gras per day)-Protein content of continue beyond the time that replacement-level fertility has been per capita net supply of ood per day. Net supply of food is defined achieved: that is. even after the net reproduction rate has reached as above. Requirements for all countries established by USDA unity. The momentum of a population in the year t is measured as provide for minimum allowances of 60 grams of total protein per a ratio of the ultimate stationary population to the population in day and 20 grams of animal and pulse protein, of which 10 grams the year r. given the assumption that fertility remains at replace- should be animal protein. These standards.are lower than those of meat level from year z onward. 1985 data. 75 grams of total protein and 23 grais of animal protei as an Popdlati Det average for the world, proposed by FAO in the Third World Food Per sq.km.-Mid-year population per square kilometer (100 hec- Supply: 1961. 1970 and 1982 data. tares) of total area; 1960. 1970. and 1983 data. Per Capita Protein Supply Fmos Animal ad Pi-Protein supply Per sq.km agricultural laod-Computed as above for agricultural of food derived from animals and pules in grams per day: 1961-65. land only. 1960. 1970. and 1982 data. 1970 and 1977 data. Population Age Suracrure (percent)-Children (0-14 years). work- Chl (Wes 1-4) Death Rate (per thousad)-N umber ofdeat of ing age (15-64 years). and retired (65 years and over) as percentage children aged 1-4 years per thousand children in the - age of mid-year population: 1960. 1970. and 1983 data. group in a given year. For most developing countries data derivc Populatiou Growrk Rate (pereer)-toreai-Annual growth rates of from life tables: 1960.1970 and 1983 data. total mid-year population for 1950-60. 1960-70. and 1970-83. HEALTH Popuation Growth Raee (percent)--oat-Annual growth rates Life Expectay at Birth (yearsr-NumWr of years a newborn of urban population for 1950-60p 1960-70. and 1970-83 data. infant would live if prevailing patterns of mortality for all people -29 ANNE I Page T-of 6 at the time of of its birth were to stay the Same throughout ats life; P#-wachwr Aso - pmwy. d seconary-Total students en- 1960.1970 and 1963 data. rolled in primary and secondary levels divided by numbers of oraor Mareap ear (per atmam@-Number of infants who die teachers in the conesponding levels. before raching one year of age per thousand live births in a given year; 1960 1970 and 193 data. COSUMPIO Access to SqO War (imur efppilea)-es wAIP, ad Ai ars (Per tosad IepIk,lm)-flsseer car core- roro-Number of people (total, urb:: and rural) with reasonable prse motor cars eatig te than eight persons; excludes ambul- access to safe water supply (includes trested surface waters br ances hearses and military vehicles. untreated but uncontaminated water such as that from protected AndW Aerivrr (per rA p pd&*)-AH types of receivers boreholes, sprags and sanitary wells) a percentages of thr repec- for radio broadcasts to general public per thousand of population; live populations. In an urban area a public fountain or stsadpost excludes un-icensed receiversi countries and in yes whe located not more than 200 meters fm a house may be consi d registration of radio sets was in effect da for recent years may AS being witn reasonable access of that house. In rural ares be comparable since most countis abolished licensing. ruasonabie accss would imply that the housewife or members of the houselhold do not have to spend a disproportionate pakt of the day TVRcob. (par I P W)_TV receivers for broadcast in fietching the familys water needs. to gcneral public per thousand population: excludes unlicensed TV Acce Excet Dipa (per fpese- wve in countrics and in years when registration of TV sets was and rmd-Number of people (total. urban. and rural) seved by excreta disposal as percentages of their respective populations. Akw*pwpircek s (pe oesidi, 0 ie-Sows the aver- Excreta disposal may include the collection and disposal, with or age crculation or -daily general interest newspae." defined as a without treatment. of human exact and wasewater by water- periodical publication devoted prin* to recording general news. borne systems or the use of pit privies and similar installations. It is considered to be daily- if i appears at lan four times a week. Jfisputed per Paid*-lopulation divided by number of prac- Ciew Arw Annace per Ckpke pe Yw-Based on the tising physicians qualified from a medical school at number of tickets sold during the yer. including admissions to pelatim per Nrder Peso-tpulation dividLd by number of drive-in cnemas and mobile units. practicing male and female graduate nurses, assistant nurses. practical nuras and nursing auxiliaries. Aipiea per Hpoq*d 5R- I winm, and wa-4-Ipulation Toad Lahm JWw (thaeniiuj-Economiclly active persons. in- (total. urban. and rural) divided by their respective number of euding armed forces and unemployed but excluding housewives. hospital beds available in public and private, general and specialined students, etc., covering population of all age. Definitions in hospitals and rehabilitation centers. Hospitals ar establishments various countries am not comparable; 1960.1970 and 1913 law. permanently staffed by at least one physician. Establishments prow F (perc&w-Fmale labor florce as percentage of total labor iding principally custodial cae are not included. Rural hospitals. force. however include health and medical centers not permanently staffed Apkuk" (percew)-Labor fo i fatning forestry hunting by a physician (but by a medical assistant, nurse, midwife. etc.) and fishing as percentage of total laborome: 190. 1970 and 196 which offer in-patient accommodation and provide a limited range data. of medical facilities. In&=7 (perz)-Labor forc in minin& construction. manu- Adissies per Hospat Bed-Total number of admissions to or facturing and electricity, water and gas as percentage of total labor discharyed from hospitals divided by the number of beds. force: 1960. 1970 and 1930 data. HOuSINGJ dpWiu Rat (Pemk-40ML 0111. Mdfa kart ip o HOUSINGor activity rates ame computed as total. male, and female labor force A7qge Yar of Household (persms per kmaW-wr4 when, as percentages of total, male and femal population of all ages arrwa-A household consists of a group of individuals who share respF tively 1960. 1970, and 1983 data. These ar based on [ s living quarters and their main meals. A boa*der or lodger may or participation rates reflecting age-sex structure of the population. and may not be included in the household for statistical purposes. long time trend. A few estimates are from national sources. Aerage Namber of Paseas per Re-oal, en, a mea- Ecoandc Depeadncy Ai-Ratio of population under 15. and Average number of persons per room in all urban, and rural 65 and over to the working age population (those aged 15-64). occupied conventional dwellings. respectively. Dwellings exclude non-permanent structures and unoccupied parts. INCOME DISTRIBUTION Pkrensage of DweSigs iw Eectriry--rar. w e, and rar.c- Perc of Totof Dipo=W Imam (both in cash nd kind- Conventional dwellings with electricity in living quarters as percen- Ao ing to percentile groups of households ranked by total house- tage of total. urban, and rural dwellings respectively. hold income. EDUCATION POVERTY TARGET GROUPS A4sted Ewanber sRais The following esumates ar very approximate measures or poverty Pimry. schoo - total. male ard femal-Gross total. male and levs, and should be interpreted with considerable caution. female enrollment of all ages at the primary level as percentages of EssedAbsolute Poverty incenie Leid (1Wper capon)-ohen respective primary school-age populations. While many countries ad rwal-Absolute poverty income level is that income level consider primary school age to be 6-11 years, others do not The below which a minimal nutritionally adequate diet plus essential differences in country practices in the ages and duration of school non-food requirements is not affordable. are reflected in the ratios given. For some countries with universal Enwimed Rehive Pemy fnc Lawd (U per capdra)-we education, gross enrollment may exceed 100 percent since some wid rormt-Rural relative poverty income level is one-third of pupils are below or above the countrys standard primary-school average per capita personal income of the country..Urban level is age derived from de rural level with adjustment for higher cost of Secondary school - total. nate and femae-Computed as above: living in urban secondary education requires at least four years of approved pri- EstxnW lopuli Akkm Abste Pbry Ineor Levo (pea' mary instruction provides general. vocational. or teacher training cen)-mbin aid rwial- Prcent of population (urban and rural instructions for pupils usually of 12 to 17 years of age: correspond- who ar -absolute poor.- ence courses are generally excluded. Vocauional Erotheui (percent of secondary)-Vocational institu- Comparative Analysis and Data Division tions include technical. industrial, or other programs which operate Economic Analysis and Projections Department independently or as departments of secondary institutions. June 1985 -30 - ANNEX I Page 5 of 6 ECOOHMIC INDICATORS- THE GAMBIA GROSS NATIONAL PRODUCT IN 1984 ANNUAL RATE OF GROWIU (S. Constant Prices) US$ min. S 1975-79 (Av.) 1979-84 1984 GNP at Market Prices 188 100 3.8 1.9 -7.6 Gross Domestic Investment 31 1.6 21.8 -7.6 -32.6 Gross National Savings -1 -1 Current Account Balance -32 -17 Exports of Goods, NFS 111 59 11.5 -1.7 31.2 Imports of Goods, NFS -138 -73 .4 .2 -1.0 OUTPUT. EMPLOYMENT AND PRODUCTIVITY IN 1984 a' Vale d@d Labor Force V.A. Per Worker US m1n. A S Thousand US$ S Agriculture 54 28 232 70 233 39 Industry 25 13 30 9 833 141 Services and Unallocated 117 59 69 21 1.696 286 Total I Average 196 100 331 100 592 100 CENTRAL GOVERNMENT FINANCE D. Min. Percent of GDP M a1984. a/ 19 79 at1 Current Receipts ' 128 21 23 Current Expenditure 141 23 21 Current Balance -13 -2 2 Capital Expenditure 70 12 12 Overall Balance -83 -14 -10 1980 1981 1982 1983 1984 (illions of Dalasis, Outstanding End-June) MONEY, CREDIT AND PRICES Money Supply 76 90 104 135 140 Bank Credit to Government (net) 27 55 37 75 81 Bank Credit to Private Sector 91 98 105 131 143 Bank Credit to Public entities 56 69 98 142 161 (Percentagse or Index Numbers) Money as % of GDP 17.9 21.9 23.0 25.6 23.2 General Price Index (1980-1984) 100.0 108.0 116.9 127.7 147.6 Annual Percentage Change in: General Price Index 5.0 8.0 8.2 9.3 15.6 Bank Credit to Government (net) - 103.7 -32.7 102.7 -8.0 Bank Credit to Private Sector - 7.7 7.1 24.8 9.2 Bank Credit to Public entities - 23.2 42.0 44.9 13.4 a/ Fiscal year ending June 30th. September 6, 1985 -31- ANNEX I I Page 6 of 6 BALANCE OF PAYMENTS MERCHANDISE EMPORMS (1981-84 AVERAGE) 1982 1983 1984 (US$ min.) % (US1 millions) Exports of Goods, NFS 100.3 105.6 111.2 Groundnuts 22.5 85.9 Imports of Goods, NFS 142.3 131.7 138.0 Fish and Fish Products 2.1 8.0 Resource Gap -42.0 -26.1 -26.8 All Other Goods 1.6 6.1 Domestic Exports M1U Interest Payments and Other Factor Payments (net) -5.4 -9.1 -8.0 Reexports a/ 58.0 Private Transfers (net) 3.0 2.6 2.4 Total MercEandise exports 84.2 Balance on Current Account -44.3 -32.5 -32.4 EEERNAL DEBT AS OF DECEMBER 31. 1984 miSS n. Direct Investment .5 -.1 .1 Official Transfers and Grants 43.8 35.3 30.4 Public Debt, Incl. Guaranteed 263.3 Public M & LT Borrowing (net) 30.1 13.5 18.5 Non-Guaranteed Private Debt .. Diabursements 34.7 20.3 25.1 Total Outstanding and Disbursed 263.3 Amortization 4.6 6.8 6.6 Other Capital (net) -46.9 -48.0 -28.3 DEBT SERVICE RATIO FOR 1984 Change in Official Reserves -16.8 -31.8 -18.2 Public Debt, 1icl. Guaranteed 22.3 (net) (+ - increase) Non-Guaranteed Private Debt Total Outstanding and Disbursed 22.3 Net Foreign Assets -65.9 -92.0 -106.5 (end June) Petroleum Imports 14.0 13.0 14.5 IBRD/MA LENDING AS OF JUNE 300 1985 UBinK- Oustanding and Disbursed W2 Undisbursed 21.1 Outstanding Incl. Undisbursed 3E. RATE OF EXCHANGE Annual Averages End Period 1981 1982 1983 1984 A r US$ 1.00 - Dalasis 1.97 2.29 2.64 3.58 4.02 a/ Includes staff estimates of unrecorded reexports. - 32 - ANNEX II Page 1 of 2 THE STATUS OF BANK GROUP OPERATIONS IN THE GAMBIA * A. Statement of IDA Credits (as of September 30, 1985) Amount (less cancellations) Credit (US$ million) Number Year Borrower Purpose IDA 1/ Undisbursed 1/ Six credits fully disbursed 22.49 897-GM 1979 Republic of Highway Maintenance The Gambia Project 5.00 0.71 1187-GM 1981 Republic of Energy Project 1.50 0.44 The Gambia 1266-GM 1982 Republic of Second Banjul Port The Gambia Project 6.50 2.25 1443-GM 1984 Republic of Urban Management and The Gambia Development 11.50 9.73 1476-GM 1984 Republic of Second Agricultural The Gambia Development 9.40 8.71 Total 56.39 21.84 of which has been repaid 0.27 Total now held by IDA 2/ 56.12 Total undisbursed 21.84 1/ Beginning with Credit 1187-GM, Credits shown here have been denominated in Special Drawing Rights. The dollar amounts in these columns represent the dollar equivalent at the time of credit negotiations for the "IDA" amounts and the dollar equivalents as of September 30, 1985, for the "undisbursed" amounts (1 SDR - US$1.05940). 2/ Prior to exchange adjustments. * The status of the projects listed in Part A is described in a separate report on all Bank/IDA financial projects in execution, which is updated twice yearly and circulated to the Executive Directors on April 30 and October 31. - 33 - ANNE% II Page 2 of 2 B. Statement of IPC Investments (as of September 30, 1985) Fiscal Year Obligor Type of Business Loan Equity Total 1983 Kombo Beach Hotel Ltd. Tourism Hotel 2.9 - 2.9 Total Gross Commitments Less Cancellations, Terminations, Repayments and Sales Total Commitments now held by IFC 2.9 - 2.9 Undisbursed Balance 0.0 - 0.0 - 34 - ANNEX III Page 1 of 1 THE GAMBIA THE SECOND HIGHWAY MAINTENANCE PROJECT Supplementary Project Data Sheet Section I: Timetable of Key Events (a) Time taken to prepare project: 18 months (b) Project prepared by: Ministry of Works & Communications (c) Date of appraisal mission: February 1985 (d) Date of completed negotiations: February 1986 (e) Planned date of effectiveness: July 1986 Section II: Special Bank Implementation Action None Section III: Spection Conditions (a) Conditions of Effectiveness: (i) Enactment of new MWC structure (para 40); (ii) Publication of charges to be paid to MED. together with adequate allocations in FY86/87 budget to pay for MED's services (para 43); (iii) Cross effectiveness conditions with EEC, UNSO and UNDP financed components (para 65). (b) Conditions of Disbursements: (i) Initial deposit of D 40,000 by Government in the Project Account before IDA advances the initial deposit in the Special Account. (para 72). (ii) IDA replenishments of the Special Account to be conditional on the Government having deposited the required counterpart funds into the Project Account (para 72). (c) Other Conditions: (i) By May 1 of each year, up to and including 1992, review three-year roll-over investment programs and annual development and recurrent budgets for the transport sector (para 37); (ii) Implementation of MED's new charging system for the central workshop to start by July 1, 1986 (para 43); (iii) Provide separate budget allocations for each MWC division (para 46); (iv) Review routine maintenance methods by June 1, 1987; any modifications in MWC's maintenance practices and equipment holdings and use to be incorporated into annual road maintenance programs from July 1. 1987 (para 56). T H E GAMBIA SECOND HIGHWAY MAINTENANCE PROJECT NATIONAL ROAD NETWORK Secand Highway Mainfenance Projech National Roads 4 Airport Rehabilitorion: Paved 0 Towns -- Paved Roods - Laterite = Rivers Bridge Earth ® National Capibil Periodic Maintenance; Local Roads: - - International Boundaries Poved Roads Paved Gravel Roads Laterite First Highway Maintenance Project: A MWC Division OFfices Periodic Maintenance: Limit af MWC Mointenance Divisions Paved Roads ( Part Grovel Roods M River Wharves N;a - - -- - T K laurok ToKolakessodi ' -, Korang- - Ng n Jowara Fa Sni Ba""' 'Jebo Kundu DipoK"C F Boao sa N 0 R H I V l S 1 0 N adieghD . 0u O ro uniodu Kere"On ,o,ikene0 Ko frrm - -- M onk - ANJUL. Kunt - Tendoba Brufu'Tnklr-- - - Tarii nikMaduar -oi ubutu y du A.r r JOm nial ni T.an Ka ZSnk~ Bunnr cv Bina? r-tang -m Søangodor Big kom~ Fmrfendo Kologi, Gunjur W E5T Gomn D l v l SIO N S E N G A L IBRD 18944 15? 14" l Capital ~nal Boundaries 0 10 20 30 4o 50 - KILOMETERS ;adiharf1,5 Kudong Kuntour. sadt * D N Karaninbo • Lom" Kota Ch MaaSopu etown Morao -7 9Yorober Kund h ,,,,---- Yorobowe Passim, _..- Bamang abugu Cular Pera -Tend Foloto So ma nKundam- %Sab -Nsouum --.-\ Gambissorm To Wingarj T M A U R l T A N l A SENEGAL THE g GombssAu A. GALI M3 A\ GUINEA . ...SIERRA - ATLANTI C LEONE IVORY OCEAN COAST GUIN A-BI SAULIBERIA G U l N E A -B l S S A U ANuARlY 1986