Transport Sector Development
  Report No: ; Type: Report/Evaluation Memorandum ; Country: Cyprus; Region: Europe And Central Asia; Sector: Transportation Adjustment; Major
                                                 Sector: Transportation; ProjectID: P008371


        The Transport Sector Development Project, supported by Loan 2906-CY for US$35 million, was
approved in FY88 and closed as planned on December 31, 1995. A total of US$29.04 was disbursed;
US$5 million was canceled at the borrowers request on May 1, 1995, and a final balance of US$0.95
million was canceled at closing. The total project costs were US$140.3 million. The ICR was prepared by
Country Department I, Europe and Central Asia. The Borrower reviewed the draft report and offered a
number of comments which have been incorporated into the text.

         The loan’s objectives were to a) increase the efficiency of the transport sector operating system;
b) improve cost recovery in revenue earning transport sector operations and in the highway system; c)
enhance the quality of transport planning and project implementation, including environmental aspects; d)
upgrade priority areas of transport infrastructure to support economic growth and social change in a cost
effective way; e) increase the extent and quality of training provided for personnel in the roads, road
transport and civil aviation sub-sectors. These objectives were supported by seven components: i)
construction and improvement of priority road sections; ii) a road strengthening program; iii)
improvements to the Public Works Department materials laboratory and the Nicosia Higher Technical
Institute training laboratory; iv) computerization of the vehicle licensing system; v) improvement of
Larnaca International Airport; vi) procurement of port equipment; and vii) provision of consultancy
services to undertake a number of studies.

         All objectives were to a large extent achieved, and the Ministry of Communications and Works
has significantly improved its capability and standards of investment planning, project management and
infrastructure maintenance. All investments in the sector now have to meet strict economic criteria, be
clearly related to economic and social needs, and environmental criteria are given a high priority.
Institutional reform has been the weakest aspect of the project, but even here progress is being made.

         OED agrees with the ICR which rates project outcome as satisfactory, sustainability as likely,
institutional development as modest, and Bank performance as satisfactory.

         The main lessons from the project are that: a) there should be greater public participation at the
planning process, especially where land acquisition is involved; and b), supervision should pay sufficient
attention to policy components, which although relatively small financially are nonetheless important to
project sustainability.

       The ICR is satisfactory, however, more information could have been provided on the reasons for
the modest institutional development impact.

         No audit is planned.