ICRR 10442 Report Number : ICRR10442 ICR Review Operations Evaluation Department 1. Project Data : OEDID : OEDID: C2160 Project ID : P005808 Project Name : Taiz Flood Disaster Prevention and Municipal Development Project Country : Republic of Yemen Sector : Urban Environment L/C Number : Credit 2160-YEM Partners involved : Japan, the Netherlands Prepared by : Klas B. Ringskog, OEDST Reviewed by : Roy Gilbert Group Manager : Gregory K. Ingram Date Posted : 08/13/1999 2. Project Objectives, Financing, Costs and Components : Objectives : (a) To provide flood control structures to protect buildings, infrastructure and save human life; (b) to implement a project cost recovery system at the municipal level and to promote a national municipal resource mobilization policy; (c) to strengthen urban management capabilities at the main branch offices; and (d) to strengthen the Ministry of Construction, Housing and Urban Planning's (MCHUP) ( formerly the Ministry of Municipalities and Housing (MNH) institutional capacity to address urban problems more efficiently . Components : (a) Construction of flood control structures to protect about 5,100 households and 280 small businesses; (b) Restoration of street pavement, terracing of slopes and construction of surface drainage; (c) Purchase of maintenance equipment for roads and flood control structures; (d) Institutional strengthening and staff training of the MCHUP and its main branch offices : (e) preparation of a follow-on urban development project; and (f) promotion of project cost recovery and municipal resource mobilization policy . Costs: Actual project costs were US$ 26.3 million as compared to the appraisal estimate of US$ 22.25 million. Financing : Project costs were financed by IDA (US$ 16.45 million), by domestic contributions (US$9.10 million) and by Japan and the Netherlands (US$ 0.75 million). The IDA credit was approved in FY 90, and closed, fully disbursed and as scheduled, on December 31, 1998. 3. Achievement of Relevant Objectives : (a) All planned flood control structures were completed within the original closing date; (b) While some progress has been made, project cost recovery system at the municipal level and the promotion of a national municipal resource mobilization policy have yet to be fully implemented . The corresponding legal covenants were deleted, but the IDA Resident Mission pursued a dialogue with the GOY and the Governor of Taiz on the importance of cost recovery mechanisms. Although the GOY is reported to favor the policy, institutional and legal arrangements for cost recovery in the Taiz Governate are awaiting formal instructions by GOY . In terms of tangible progress, the GOY did establish a "Cleaning Fund" in September 1998, the proceeds of which would be used for maintaining the flood channels and solid waste management activities in Taiz . The success in promoting a national municipal resource mobilization policy remains unreported and little has been accomplished in this respect; c) The ICR makes fleeting reference to a strengthened urban management capabilities at the Taiz Branch Office only ( without mentioning the situation at the other main branch offices) but does not document it; and (d) The institutional capacity of MCHUP was strengthened through training in Yemen and abroad . As a result, MCHUP have prepared a follow -on development project, including feasibility analysis, designs and cost estimates . 4. Significant Achievements : All physical flood control structures were completed within the planned time period and offered protection during three years of severe rains 1996, 1997 and 1998 to three to four times as many households as estimated at appraisal. This project is a good example of successful and timely mitigation of natural disaster effects . 5. Significant Shortcomings : The effective implementation of cost recovery mechanisms is still quite uncertain since the legal and institutional arrangements remain inactive pending a decision from the Government . The extent of strengthening of the MCHUP main branch offices is also uncertain . In addition, project implementation was inefficient as, despite reduction in scope of investments, the project experienced a 20% cost overrun. 6. Ratings : ICR OED Review Reason for Disagreement /Comments Outcome : Satisfactory Marginally Satisfactory The fact that the stated objective of promoting a "national resource mobilization policy" and that formal measures to introduce project cost recovery are pending or uncertain lowers the rating. Institutional Dev .: Substantial Modest The ICR does not provide the data to judge whether the institutional development has been substantial . The late start with creating effective cost recovery mechanisms justifies a "modest" rating. Sustainability : Likely Uncertain The ICR does not provide the information and analysis to permit a judgment whether the project works will be sustainable. See also the comment on cost recovery above which justifies an "uncertain" rating. Bank Performance : Satisfactory Satisfactory Despite the shocks of unification, riots and civil war, supervision effort was commendable. Borrower Perf .: Satisfactory Satisfactory The Borrower, like IDA, seems to have focused primarily on the physical flood control structures and less on the cost recovery mechanisms. Even so the performance is rated "satisfactory" considering the difficulties created by the 1994 civil war. Quality of ICR : Satisfactory 7. Lessons of Broad Applicability : IDA made a deliberate decision to continue supporting the Project despite implementation difficulties due to the 1994 civil war. The more intensive and effective supervision through a strengthened IDA Resident Mission proved the key to rescue the Project and its associated flood control benefits . 8. Audit Recommended? Yes No 9. Comments on Quality of ICR : The ICR treats the state of two important objectives of project cost recovery and adequate provision for operations and maintenance costs in little depth . There are no financial projections that could help judge the adequacy of the financial viability of the flood control system . Some of the Key Lessons Learned are trite and could apply to most any project.