ICRR 10316
                                                                                      Report Number : ICRR10316
                    ICR Review
                    Operations Evaluation Department




1. Project Data :
             OEDID:
             OEDID :    L3521
         Project ID :   P006051
      Project Name :    Flood Rehabilitation Project
            Country :   Argentina
             Sector :   Other Urban Development
       L/C Number :     L3521
  Partners involved :
       Prepared by :    Anna Amato, OEDST
      Reviewed by : Ronald S. Parker
    Group Manager : Gregory K. Ingram
       Date Posted : 06/02/1999

2. Project Objectives, Financing, Costs and Components :
The project was designed as an emergency response to flooding generated by the 1991-92 El Niño
phenomenon in Argentina, which caused US$905 million in economic losses and damaged seven
provinces. Project objectives were to: (i) restore the service capacity of damaged infrastructure, and (ii)
establish a sound institutional framework for the coordination and implementation of the overall
government rehabilitation program. The loan was in the amount of US$170 million, US$2.8 million was
canceled at loan closing.
Final project cost: US$258.7 million (appraisal estimate: US$270 million).
Components: Rehabilitation of (i) transport and power infrastructure, (ii) emergency flood control,
drainage and water control works, and (iii) housing, education and health facilities. Additional
components provided for (iv) technical assistance to improve the capacity of institutions responsible for
flood forecasting and mitigation and (v) preparation of a follow-up project for future flood protection, and to
finance an early flood warning system.

3. Achievement of Relevant Objectives :
The project fully achieved its physical and institutional objectives, although with a three year delay.

4. Significant Achievements :
Effective federal and provincial emergency agencies were established. Critical physical, economic and
social infrastructure was rehabilitated. Drainage improvements withstood subsequent severe weather
events including the 1997-98 El Niño. The internal economic rate of return is 35.1 percent based on
estimated losses avoided. The quantity of solid waste being dumped in drainage canals was reduced,
resulting in improved sanitary and health conditions and lower maintenance costs. Project efforts to
increase public awareness of environmental sanitation and respect for the maintenance of flood
protection structures were quite successful. A stronger sense of community identity has developed in the
communities where new housing was built using the self-help construction methodology.

5. Significant Shortcomings :
Lack of experience by provincial agencies in Bank procurement and administrative procedures resulted in
a slow start. Additional initial delays were due to a bureaucratic approval process for subsidiary loan
agreements with the provinces. In 1995, the national and provincial governments were constrained by the
“Tequila� crisis to delay counterpart funding. Serious engineering design flaws discovered during
construction led to an eighteen month delay.


6. Ratings :             ICR                       OED Review         Reason for Disagreement /Comments
              Outcome :    Satisfactory          Satisfactory
    Institutional Dev .:   Substantial           Substantial
        Sustainability :   Likely                Likely
   Bank Performance :      Satisfactory          Satisfactory
      Borrower Perf .:     Satisfactory          Satisfactory
       Quality of ICR :                          Satisfactory

7. Lessons of Broad Applicability :
− In emergency projects, rehabilitation is almost never enough: components should be designed to reduce
vulnerability to disaster and increase local capacity to manage future emergencies.
− Decentralized decision-making by provincial implementing units and light-handed central government control
facilitated project progress.
− Emergency projects should not finance housing reconstruction on at-risk land.
-- The use of prefabricated housing in post-disaster reconstruction should be avoided.
− The goals of restricting floodplain development and preserving ecosystems are better achieved and supported by
fiscal incentives, improved land use planning and management practices, and sound environmental policies than by
physical measures.
− Emergency loans should be flexible and Bank staff should anticipate shifting needs and priorities, and help
projects to meet unforeseen demands and bottlenecks.
− The active participation of project beneficiaries resulted in the timely availability of construction materials and
the incorporation of local preferences and customs in the architectural design of the new houses.
− Bank financed emergency operations should anticipate counterpart funding problems caused by unanticipated
disaster-related expenditures required of the federal and local government.
- Agencies inexperienced with the Bank's procurement procedures benefit from more frequent auditing. Project
audits took place semi-annually instead of annually

8. Audit Recommended?           Yes     No
           Why? The lessons learned during the implementation of the project, and the impacts of project -initiated
activities following loan closing can be expected to have broad applicability to other emergency lending projects .

9. Comments on Quality of ICR :
The ICR was of satisfactory quality. More descriptive information on the problems associated with the design and
implementation of the physical components would have made the report more complete