The World Bank Vietnam Road Asset Management Project (P123961) REPORT NO.: RES43279 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF VIETNAM ROAD ASSET MANAGEMENT PROJECT APPROVED ON DECEMBER 12, 2013 TO Socialist Republic of Vietnam TRANSPORT EAST ASIA AND PACIFIC Regional Vice President: Victoria Kwakwa Country Director: Carolyn Turk Regional Director: Ranjit J. Lamech Practice Manager/Manager: Almud Weitz Task Team Leader(s): Phuong Thi Minh Tran, Hongye Fan The World Bank Vietnam Road Asset Management Project (P123961) ABBREVIATIONS AND ACRONYMS DRVN Directorate for Roads of Vietnam EIA Environmental Impact Assessment EM Ethnic Minority EMP Environmental Management Plan EMDP Ethnic Minority Development Plan ESIA Environmental and Social Impact Assessment ERR Economic Rate of Return FS Feasibility Study GOV Government of Vietnam HDM-4 Highway Development and Management Model (Version 4) IBRD International Bank for Reconstruction and Development ICB International Competitive Bidding IDA International Development Association IFRs Interim Financial Reports IRI International Roughness Index ISDS Integrated Safeguards Data Sheet ISR Implementation Status and Results Report MOF Ministry of Finance MOT Ministry of Transport NRN National Road Network NCB National Competitive Bidding NH National Highway ODA Official Development Assistance PAD Project Appraisal Document PBC(s) Performance-Based Contracts PDO Project Development Objective PMU Project Management Unit PPCs Provincial People’s Committee RAMS Road Asset Management System RAP Resettlement Action Plan RETF Recipient-Executed Trust Fund RMF Road Maintenance Fund RNIP Road Network Improvement Project RF Results Framework RP Resettlement Plan RRMUs Regional Road Management Units SDR Special Drawing Rights VPRoMMS Vietnam Provincial Road Maintenance Management System VRAMP Vietnam Road Asset Management Project The World Bank Vietnam Road Asset Management Project (P123961) BASIC DATA Product Information Project ID Financing Instrument P123961 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 12-Dec-2013 31-Dec-2020 Organizations Borrower Responsible Agency The Socialist Republic of Vietnam Project Management Unit No. 3 (PMU3) Project Development Objective (PDO) Original PDO The proposed Project Development Objective (PDO) is to improve the efficiency and sustainability of the national road asset management and maintenance practices performed by the Ministry of Transport on national roads in Vietnam. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-53310 12-Dec-2013 14-Jan-2014 11-Apr-2014 31-Dec-2020 250.00 173.96 55.07 TF-15733 14-Jan-2014 14-Jan-2014 14-Jan-2014 30-Jun-2016 1.05 1.03 0 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Project Status The World Bank Vietnam Road Asset Management Project (P123961) 1. A credit in the amount of US$250.0 million equivalent (SDR 162.6 million) was approved by the Board of Executive Director of the International Development Association (IDA) on December 12, 2013 for the Vietnam Road Asset Management Project (VRAMP). VRAMP was co-financed by an Australian Trust Fund Grant (Grant No. TF015733) in the amount of AUS$1.7 million (about US$1.05 million). The Financing Agreement for VRAMP became effective on April 11, 2014 and has a closing date of December 31, 2020. The Grant Agreement became effective on April 11, 2014, and its closing date was June 30, 2016. The Project Development Objective (PDO) is to improve the efficiency and sustainability of the national road asset management and maintenance practices performed by the Ministry of Transport on national roads in Vietnam. The project comprises four components: (A) Road Asset Management System Development (US$10.0 million); (B) Road Asset Preservation (US$156.6 million); (C) Road Asset Improvement (US$133.4 million); and (D) Institutional Strengthening Program (US$1.7 million). The total project cost is US$301.7 million, out of which the IDA credit has been used to finance civil work, (ii) consultancy services, and (iii) goods and equipment and counterpart funds have been used to support (i) consultancy and project management cost and (ii) land acquisition cost. The grant was used to finance the consultancy service to develop the integrated framework for national roads asset management. The framework was developed with data and information collected and operationalized for the whole national highway network. 2. By December 2020, US$173.96 million have been disbursed from the IDA credit (76 percent of the total credit amount). The grant closed on June 30, 2016 with US$1.03 million disbursed (almost 100 percent of the total grant). Project implementation has progressed well with satisfactory completion of all components as planned. Overall, the project reached completion of 100 percent of contracts of works, goods and services. The Road Asset Management System (RAMS) has been developed and is fully operational, with data collection for the whole national highway network. The Road Asset Preservation Component has completed 100 percent of construction and PBC maintenance contracts with acceptable quality. The Road Asset Improvement Component also completed all road improvements and handed over for operation. The institutional strengthening program was completed too. 3. Progress toward achieving the PDO and project implementation progress are rated Satisfactory. The project complies with the Bank’s safeguards and fiduciary policies. There is no integrity or Inspection Panel case related to this project. There are no overdue or outstanding audit issues. The project has also fully complied with World Bank safeguards, procurement, financial management, disbursement policies and legal covenants. During the implementation of the VRAMP, fiduciary and safeguard performance of the project has been consistently rated as Satisfactory and/or Moderately Satisfactory in the ISRs. B. Project Savings 4. Due to exchange rate fluctuations and the savings from the procurement process, it has been estimated that about US$55.07 million out of the IDA credit will remain as savings. The Government of Vietnam (GOV) has approved using approximately US$31.89 million of these savings for three additional activities1 including i) enhancement of the pavement and 1The GoV has completed the internal processing steps to approve the use of approximately US$31.89m in savings for additional activities. The Prime Minister has issued the Decision No. 1900/QD-TTg, dated Dec 4, 2020, on Approval of Investment Policy Adjustment of VRMAP financed by the World Bank. The Decision approves using the project savings for the investment cost of three The World Bank Vietnam Road Asset Management Project (P123961) intersections of a 7.65km section of National Highway 6 (NH6); (ii) construction of a 19.5 km bypass in Son La city; and (iii) improvement and expansion of 1.39 km of National Highway 2 (NH2). The three activities will complement the highway improvement in the original scope of the project and help scale up the PDO achievement. An extension of the project closing date by 24 months is required to complete these activities. The Ministry of Finance (MOF) sent a letter to the World Bank dated December 25, 2020 requesting an extension of the VRAMP closing date to December 31, 2022, as well an amendment to the Financing Agreement. The GoV and IDA will further discuss on the remaining savings of about US$ 23.18 million, which may be maybe cancelled at later stage through as separate restructuring. 5. The feasibility studies for the three activities were completed and appraised by the World Bank team. The implementation plan including the procurement and disbursement plan of the proposed activities was developed and cleared by the World Bank. The additional activities will be completed by December 2022. C. Rationale for Restructuring 6. The additional activities will contribute further to PDO achievement and project outcomes. The additional activities will further contribute to achieving the PDO which is to improve the efficiency and sustainability of the road asset management and maintenance practices performed by the Ministry of Transport on national roads in Vietnam. In particular, the proposed activities will utilize the RAMS analysis to support design and management of the additional national highway sections and enhance the overall condition of the national highway network by including more sections with quality and timely maintenance. 7. Social and economic benefits for the people in project areas will be improved. The additional activities will improve economic and social benefits for the people in north and northwest regions of Vietnam, especially in Hoa Binh, Son La and Ha Giang provinces as NH2 and NH6 are the two critical corridors for economic and social development of the regions. By enhancing the highway infrastructure in the north and northwest regions of Vietnam, the activities will help remove bottlenecks in the main transport network, improve road safety, and contribute to regional economic growth and inter-provincial economic connectivity and social inclusion. The activities are also in line with provincial master plans on socio-economic development through 2030 with a vision to 2050. 8. The additional activities will contribute to employment opportunities in the construction industry in the selected regions. The Covid-19 pandemic has caused new challenges for the economic development and employment market in Vietnam. The slow- down of the economy caused many job losses. The proposed activities will help create new employment opportunities in the construction industry in Vietnam, as all the civil works will follow the national competitive bidding process and be awarded to domestic contractors. 9. The project efficiency will be maintained with the project extension. To allow completion of all activities under the project, and more effectively support the implementation of road asset management plan in Vietnam, it is proposed to extend the closing date of the credit by 24 months. With this extension, the additional investment has an economic rate of return (ERR) activities. The total cost of three activities are estimated as US$35.72 million of which IDA credit savings will finance US$31.89 million and counterpart funding will contribute US$3.83 million. The World Bank Vietnam Road Asset Management Project (P123961) of 20.33 percent compared to 19 percent of the similar road improvement section under the original project, and a net present value of VND479.07 billion with a discount rate of 12 percent. 10. The risks are low for implementing the additional activities. The risks in implementation capacity have been mitigated through an experienced PMU, the engagement of several experienced institutes, and an experienced project management consultant to provide technical support in project implementation. Training has been provided to government officials, contractors and supervision engineers on contract management and site management, as well as on fiduciary and safeguards requirements including for Operational Health Safety. The Bank team will continue the capacity building efforts and provide additional technical support to the PMU as needed. In view of this, the risks for institutional capacity for implementation and sustainability is considered low. II. DESCRIPTION OF PROPOSED CHANGES A. Description of Proposed Changes 11. The proposed activities are additional highway sections as part of or bypass for NH6 and NH2 which are two main highways financed by the original scope of the project. The specific activities include: (i) pavement strengthening of 7.65km of NH6, sections Km70+650-Km78+300 and improvement of intersections at starting and ending points of the road section; (ii) construction of a 19.5km bypass in Son La city, Section NH6 Km289+950-Km308+820; and (iii) improvement and expansion of 1.39 km of NH2, section Km284-+600-Km286+995. Annex 1 indicates the location map of the three sections. The proposed activities will be implemented as additional activities for both road asset preservation and road asset improvement (component B and C). MOT and PMU 3 will continue managing and implementing the additional activities as the main counterpart agency and implementation unit to utilize their experience and good practice on VRAMP implementation. 12. NH6 (Hanoi - Dien Bien), nearly 500 km long, connecting the Northwest provinces (Hoa Binh, Son La, Dien Bien) to Hanoi capital, is a strategic traffic axis promoting economic development of northwest provinces and international trade through Tay Trang bordergate with Lao PDR as well as serves as a major transport route for major energy projects such as Son La hydropower plant and Lai Chau hydropower plant. NH6 has been facing challenges of deteriorating pavement, severe traffic congestion, and increasing freight traffic demand. Those challenges were partially addressed by government-funded projects and the original scope of the project. To further improve the quality of NH6 infrastructure and service for better connectivity from northwest provinces to Hanoi City as well as to enhance traffic safety, it is critical to implement the proposed activities 1 and 2. 13. The proposed activity 1-strengthening the pavement of NH6 section Km70+650-Km78+300 (7.65 km) will complete the quality highway access from Hoa Binh to Hanoi, which will enhance the overall infrastructure and service quality of NH6, and contribute to better accessibility of people in the Hoa Binh province to economic and employment opportunities in Hanoi. NH6 section connecting Hanoi City to Hoa Binh City (Km 38-Km303), have been mostly upgraded by a government project (improvement of section Km38+000-Km70+650) and under the original scope of VRAMP (improvement of section KM78+300- KM193-100 and section Km 193+000-Km303+000). Currently these sections are open to operation. The only section left for improvement is Km70+650-Km78+300 (Dong Tien ward-Thong Nhat commune, Hoa Binh city). This section has been operated for over ten years and is seriously degraded with many structural defects such as large-scale crocodile fractures, blistering of The World Bank Vietnam Road Asset Management Project (P123961) pavement on the carriageway lanes, and potholes. The deterioration has increased risks in traffic accidents and congestions, as well as impedes the efficiency of the commuting and logistics. 14. In the territory of Son La province, NH6 is a strategic artery traffic axis, passing the dynamic economic zone of Son La "National Highway No. 6's axial area". The proposed activity 2- construction of the 19.5 km bypass in Son La city, section NH6 Km289+950-Km308+820 will directly address the severe traffic congestion of NH6 sections in Son La, and positively impacts the socio-economic development of Son La province. In recent years, along with the upgrading of Son La town to Son La city and the operation of Son La and Lai Chau hydropower plants, traffic density through Son La city has increased dramatically creating traffic congestion and traffic safety concerns along NH6 sections in the inner city, where the population is concentrated with high density. Son La bypass will remove the through-traffic from the city center to the periphery, reduce congestion in the city, and off-load NH6 for better commuting and logistics efficiency. In addition, the Son La bypass will be mostly located alongside a total of six communes where about six ethnic groups reside, and the economic activities are mostly agroforestry. The Son La bypass will improve the access of rural and mountainous areas to the city and create more business and job opportunities for these ethnic groups. 15. National Highway No.2 is the highway connecting Northern provinces of Vietnam including Ha Giang to Hanoi City and Thanh Thuy border gate which connects to China. This is an important arterial national highway for cultural, economic and trade activities. The proposed activity 3- improvement and expansion of 1.39 km of National Highway 2 (NH2), section Km284-+500- Km286+000 will enhance the connectivity of Ha Giang province to Hanoi city and Thanh Thuy border gate. The proposed section is part of the Southern access road to Ha Giang city, which was previously constructed at class 3 (Mountainous) road standard and will be upgraded to urban road standard, to accommodate increasing traffic and improve road safety. This activity will also support the tourism development of UNESCO Dong Van Karst Plateau Geopark nearby and promote international trade activities in Ha Giang province through Thanh Thuy international border gate with China. 16. Procurement. The National Competitive Bidding (NCB) procedures specified in the NCB Annex 2 to Schedule 2 in the Financing Agreement refer to those set forth in the Law on Procurement No. 61/2005/QH11 dated November 29, 2005. This Law had been replaced by the Law on Procurement No. 43/2013/QH13 dated November 26, 2013, which is currently applicable. Since all the proposed additional works contracts will be procured using NCB method, the NCB Annex 2 in the Financing Agreement should be updated to correctly refer to the currently applicable national Procurement Law (the Law on Procurement No. 43/2013/QH13) and clearly state the new appropriate changes and modifications that the Bank requires the Borrower to adopt in order to make its NCB procedures as stated in the Law on Procurement No. 43/2013/QH13 acceptable to the Bank. The updated NCB Annex is attached as Annex 2. 17. Proposed Changes to the Financing Agreement. The changes proposed by this restructuring will require an amendment to the Financing Agreement to: (a) extend the closing date; (b) introduce appropriate provisions related to the implementation of the Ethnic Minority Development Plans required for the additional activities and provide more specific details about the carrying out of technical assistance or studies under the Project and the safeguards-related content of the bidding documents and contracts for civil works under the Project; and (c) revision of the NCB (as described in para. 16 above). The World Bank Vietnam Road Asset Management Project (P123961) 18. Project Cost and Financing Plan2. Table 1 and Table 2 show the original project cost as presented in the Project Appraisal Document (PAD), along with the revised project costs as a result of the proposed restructuring. MOT and MOF have shown strong commitment to the project and MOT has embedded the project components in its official plans. GOV has the financial capacity to provide counterpart funding of US$3.83 million from the fiscal budget for tax of civil work, consultancy for ODA fund using; construction drawing design - cost estimate, preparation of bidding document; appraisal of cost estimate, design, traffic safety; audit and final accounting; civil work insurance, contingency cost, etc. Table 1: Project Cost and Financing Plan at Appraisal Total Counterpart Co-financing IDA Cost funds (AUS Grant) No Project Components US$ US$ US$ US$ mil % % % mil mil equiv. Road Asset Management System 1 A 9.33 83% 8.30 0.00% 0 17.00% 1.03 Development 2 B Road Asset Preservation 156.60 100.00% 156.60 0.00% 0 0.00% 0 3 C Road Asset Improvement 133.40 62.50% 83.40 37.50% 50 0.00% 0 4 D Institutional Strengthening Program 1.70 100.00% 1.70 0.00% 0 0.00% 0 Total 301.30 82.97% 250.00 16.59% 50.00 0.44% 1.03 Table 2: Project Cost and Financing Plan after Restructuring Co-financing Total Cost IDA Counterpart funds N (AUS Grant) Project Components o US$ US$ US$ mil % US$ mil % % mil Equiv. Road Asset 13.59 1 A Management System 7.58 86.41% 6.55 0.00% 0 1.03 % Development 2 B Road Asset Preservation 144.85 97.51% 141.25 2.49% 3.60 0.00% 0 Road Asset 3 C 99.08 64.77% 64.17 35.23% 34.91 0.00% 0 Improvement Institutional 4 D 1.04 100.00% 1.04 0.00% 0 0.00% 0 Strengthening Program 5 Remaining Amount 28.49 59.67% 17.00 40.33% 11.49 0.00% 0 Total 281.04 81.84% 230.01 17.79% 50.00 0.37% 1.03 Appraisal Summary of Additional Activities 19. Environmental and Social Safeguards. The World Bank Environmental and Social Safeguards Policies (OP/BP 4.01, OP/BP 4.04, OP/BP 4.12) have been triggered and complied with under the project. Overall safeguards performance by the 2 The VND and USD exchange rates are different at project appraisal and after project restructuring. The World Bank Vietnam Road Asset Management Project (P123961) latest ISR has been classified as Satisfactory. The additional activities proposed under this project restructuring are expected to be carried out in an existing rural and urban areas, and along existing roads. Implementation of the additional activities will not affect any natural habitats, protected areas, important/threatened flora and fauna species or biodiversity areas of high value. It will not cause degradation or conversion of any known natural habitats or impact any watersheds. Therefore, OP/BP 4.04 is not triggered for the additional activities (though it was triggered for the existing activities). The proposed restructuring involves a Level 2 Restructuring since the project is required to (1) trigger a new safeguards policy (Indigenous Peoples – OP/BP4.10) and implement Ethnic Minority Development Plans (EMDPs) to ensure the Ethnic Minority peoples receive social and economic benefits that are culturally appropriate and gender and intergenerationally inclusive; and (2) update the Integrated Safeguards Data Sheet (ISDS). The OP/BP4.10 is triggered given that the proposed new road sections pass through the areas where there are ethnic minority groups (Thai, Muong, H’Mong, Tay, Nung, San Diu and Dao) both affected by and benefited from this investment. In particular, the bypass in Son La (19.5km) runs through six communes/wards which affects a total number of 731 households, of which ethnic minority people account for more than a half (63 percent). The EM groups present in the project areas have resided for a long time and collectively attached to geographically distinct habitats (rocky-mountains and narrow valleys) in the production and economic development. Their livelihood activities are based mainly on agriculture, cultivation, husbandry and forestry in the form of taking care, protection and exploitation of non-timber forest products (NTFPs). Although these EM groups live intermixed with the dominant Kinh population with similar social and political arrangements, they are also self-identified and well recognized as distinct customary cultural groups. By the national legislations, these EM groups are well recognized as the groups with special attentions paid and various resources invested for further social-cultural-economic development of the EM populations nationwide. The bypass in Son La (19.5km) runs through 6 communes/wards which affects a total number of 731 households, of which the ethnic minority population account for 470 households (63%). While in Hoa Binh and Ha Giang, since the impacts are marginal, the EMs are beneficiaries of the project due to the improvement of the road condition. Each of the participating provinces (Hoa Binh, Son La, and Ha Giang) will prepare, adopt and implement an Ethnic Minority Development Plan (EMDP) to carry out meaningful free, prior and informed consultations with the affected EMs and their communities, to ensure their voices are heard, and to ascertain broad EM community support for project activities. 20. For the proposed activities to be implemented in the sections of NH6 and NH2, given the compensation and assistance activities have already been implemented, two due diligent report (DDRs) for Hoa Binh and Son La were developed accordingly. For the activities in Ha Giang, a Resettlement Plan was prepared. There are 752 households affected by the loss of lands and assets on lands along the ROW, with a total land area to be acquired 55.6ha (Son La NH6 section is 52ha, and Ha Giang NH2 section is 3.6ha). Given the compensation of the section of NH6 in Hoa Binh was fully completed in 2005-2006, there is no households affected by the pavement strengthening. For the construction of section of NH6 in Son La, there are total of 731 household affected, of which 32 households whose main houses are fully affected. All of these households opted for self- relocation as their remaining land is viable for moving backward. For the improvement and expansion of NH2 in Ha Giang, there are total 21 households affected, with a total land to be taken of 3.6ha. 21. Natural Habitats OP/BP 4.04: During project preparation of the parent project it was determined that a 10km section of the existing NH6 runs through the Hang Kia Pa Co Natural Reserve, of which approximately 07 km pass through the buffer zone area and about 03 km pass through the core zone (strict protection area) of the natural reserve, from Km149 to Km152. Therefore, this policy was triggered. However, this policy is not relevant for the additional activities under the project restructuring, as these expected to be carried out in existing rural and urban areas, and along existing roads alignment. Implementation of the additional activities will not affect any natural habitats, protected areas, important/threatened flora and The World Bank Vietnam Road Asset Management Project (P123961) fauna species or biodiversity areas of high value. It will not cause degradation or conversion of any known natural habitats or impact any watersheds. 22. The project's overall potential social and environmental impacts are the positive impacts as the project is expected to result in: i) improvement of traffic conditions in the project area; ii) increase in the accessibility of local people to neighboring areas; (iii) creation of favorable conditions for the trade and sale of agricultural and forestry products in the project communes/ wards; (iv) enhancing tourism development capabilities, exploiting indigenous cultural potentials. The adverse environmental impacts of the three investment items proposed under this restructuring are similar to those already identified, assessed and implemented under the project and include: i) increase of dust, noise, and vibration; ii) pollution risks related to generation of waste and wastewater, especially the large amount of excavation materials; iii) traffic disturbance and increase of traffic safety risks; iv) the risk of erosion and landslides on steep slopes and deep excavation areas as well as potential negative impacts on existing weak structures; v) disturbance to daily socio-economic activities in the project area and social disturbance; vi) health and safety issues relating to community and workers at the construction sites; and vii) the social impacts associated with land acquisition, interruption of business and crop production due to construction-related activities and mobilization of workers to the site. These impacts are temporary and in most cases the mitigation measures are availably designed. These have been confirmed by the ESIA and ESMP prepared for this restructuring. Therefore, the proposed project restructuring is still classified as a Category B project. 23. An ESIA has been prepared for the construction of a 19.5 km bypass in Son La province, and two ESMPs have been prepared for the pavement strengthening of 7.65km of NH6 and for the improvement and expansion of 1.39 km of National Highway 2. The ESIA and ESMPs have proposed adequate measures to mitigate the identified impacts and risks together with a monitoring plan. Implementation responsibilities, institutional arrangements, reporting requirements and budgeting have also been included in the ESMPs. The Bank has reviewed the ESIA and ESMPs and found them satisfactory. The ESMPs will be included in the bidding and contractual documents for implementation by the contractor. Implementation of the ESMPs will also be monitored and supervised by PMU3, the construction supervision consultant, the independent environmental monitoring consultant. 24. Ethnic Minority Development Plans (EMDPs) were developed and disclosed publicly. The EMDPs include measures to ensure that (a) the EMs affected by the project receive culturally appropriate social and economic benefits; and (b) adverse effects by loss of lands and assets on land will be compensated for. These EMDPs were reviewed and cleared by the World Bank on December 16, 2020, disclosed in project areas on December 16, 2020, and published on the World Bank’s website on December 25, 2020. The ISDS has been updated to reflect these changes. 25. Public consultations with the directly and indirectly affected people and households, local authorities and mass organizations were conducted in the process of preparing the ESIA, ESMPs, RPs, and EMDPs in October 2020. Feedbacks from all the consultations were taken into account in the revised safeguard documents and activity design. Consultation will be continuously conducted during project implementation. Prior to appraisal of the restructuring project, the ESIA, ESMPs, RPs, and EMDPs were disclosed locally in Vietnamese at the project site on December 16, 2020. These safeguard documents in English were also disclosed on December 25, 2020 at the World Bank’s external website. The World Bank Vietnam Road Asset Management Project (P123961) 26. The project-wide Grievance Redress Mechanism (GRM) will be maintained in all project provinces based on the existing national GRM already established mechanism embedded in all administrative levels (e.g. one stop shops at the ward and community level, and inspectorates at the district/provincial levels), as well as and the people’s courts. Contact focal points are in place at the site in parallel with functioning all-level administrative structure. This mechanism functions well in dealing with issues such as adjudicating land boundaries (at the commune level) or resolving the GBV/ESHS impacts related to construction. The project GRM will build on, and coordinate, these mechanisms to ensure that concerns are captured and addressed in a satisfactorily and timely fashion. 27. Social safeguards capacity. The project continues being managed by the Project Management Unit No.3 (PMU3), who has proven experience with the World Bank safeguards policies. The PMU3, under the Directorate for Roads of Vietnam (DRVN) has been well performing various projects using both ODA and national financings. The PMU3 has demonstrated its competence in managing and coordinating all resettlement matters. The PMU3 was adequately trained to manage and supervise the implementation of the World Bank safeguards policies in all project locations and has received ongoing guidance on the implementation of the EMDPs from the World Bank Task team to be fully capable of overseeing all matters related to ethnic minority. 28. Financial management and disbursement. For Accounting system and Financial reporting: Circular No 195/2012/TT- BTC (from MOF) has been totally replaced by the new Circular 79/2019/TT-BTC. This has been used as the “current accounting system” for PMU3 (Report No: PAD699, Document of World Bank in 2013, page 23, item 11). In order to meet the Bank FM requirements, changes might be required. Although the WB’s Disbursement Guidelines has been updated since 2013 (World Bank Disbursement Guidelines for Investment Project Financing, dated February 2017), the disbursement methods remain unchanged (pages 1-2 of the new Guideline). No modification of the disbursement methods is required. 29. Technical appraisal. The technical solutions proposed in the Feasibility Study (FS) of the three activities are technically sound, well aligned with national design standards of the roads and structures and suitable for the terrain conditions. Given the natural disaster and climate risks in the project areas, there are some resilience standards considered in the FS but should be further strengthened in the detailed design. The FS also took into account of traffic safety with effective solutions of intersection design, sight distance clearance in sharp horizontal curves, and principally designed of traffic safety facilities of traffic sign, road marking and side post. With the proper design and implementation of the proposed road works, the road safety and climate resilience of the NH 6 and NH2 will be enhanced. The detailed technical appraisal is indicated in Annex 3. 30. The economic analysis of the proposed new activities was carried out in accordance with the World Bank guidelines of Economic Analysis of Investment Operations and Economic Analysis Guidance Note.3 The proposed activities would bring substantial economic benefits including: (i) savings in passenger and freight travel time; (ii) reduction in vehicle operation cost; and (iii) reduction in vehicle accidents. The new activities have an expected Net Present Value (NPV) of VND 479.07 billion and an expected Economic Rate of Return (ERR) of 20.33 percent, which is higher than the World Bank recommended economic opportunity cost of capital (12 percent). The evaluation was performed using a discount rate of 12 percent, a 30-year evaluation 3The World Bank. January 1998. Handbook on Economic Analysis of Investment Operations. Operational Core Services Network, Learning and Leadership Center. The World Bank. April 9, 2013. Guidance Note of Economic Analysis for Investment Project Financing. OPSPQ The World Bank Vietnam Road Asset Management Project (P123961) period, and an average annual traffic growth rate of 6.0 percent per year for the first ten years, then 3.5 percent thereafter. Sensitivity analysis carried out indicated that the ERRs for the tested cases were higher than 12 percent. Table 3 summarizes the economic benefits of the new activities and more detailed analysis is indicated in Annex 4. Table 3: Economic Benefits of the New Activities Criteria Value 479.07 (VND billion) NPV ~ 20.77 ($ million) ERR (%) 20.33% Benefit to Cost Ratio (B/C) 1.579 31. Results Framework (RF). The RF is proposed to be revised as shown in the Results Framework. The principal changes include the revision of target values for the relevant indicators to reflect the impacts of the additional activities on the intermediate results including i) PBC maintenance implemented under the project (target value increased from 170 km in Dec 2020 to 234 km in Dec 2022 ); ii) Km of roads maintained under the project with traditional input method (target value increased from 161 km in Dec 2020 to 168.35 km in Dec 2022); and iii) Km of roads improved under the project (target value increased from 56 km in Dec 2020 to 79.9 km in Dec 2022). Detail is annex 5. The RF is set forth in the Project Operations Manual, which will be updated, following the approval of the restructuring 32. Implementation Plan. It is expected that the procurement for consultant selection for detailed design, cost estimate, and bidding document will be carried out from January to April 2021. Procurement for selection of civil work contractor will be carried out from May 2021 to August-September 2021 and the procurement for selection of supervision consultant will be carried out from January to July 2021. The civil work construction will be implemented from August 2021 to December 2022. 33. Disbursement Estimates. The disbursement of IDA savings is estimated to reach 15 percent by 2021, 65 percent by 2022 and 100 percent by 2023. Table 4 present the disbursement estimates. Table 4: Expected Disbursement of IDA Savings Expected Disbursements (in USD Million) – Project’s original plan and savings Fiscal year 2015 2016 2017 2018 2019 2020 2021 2022 2023 Annual 12.00 50.00 40.00 43.00 15.00 38.00 4.50 3.50 23.89 Cumulative 12.00 62.00 103.00 146.00 162.00 200.00 204.50 208.00 231.89 The World Bank Vietnam Road Asset Management Project (P123961) III. SUMMARY OF CHANGES Changed Not Changed Results Framework ✔ Loan Closing Date(s) ✔ Overall Risk Rating ✔ Safeguard Policies Triggered ✔ Legal Covenants ✔ Implementation Schedule ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ PBCs ✔ Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ EA category ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Other Change(s) ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_LOANCLOSING_TABLE The World Bank Vietnam Road Asset Management Project (P123961) LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IDA-53310 Effective 31-Dec-2020 31-Dec-2022 30-Apr-2023 TF-15733 Closed 30-Jun-2016 28-Dec-2016 OPS_DETAILEDCHANGES_SORT_TABLE SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT) Risk Category Rating at Approval Current Rating Political and Governance  Moderate Macroeconomic  Moderate Sector Strategies and Policies  Moderate Technical Design of Project or Program  Moderate Institutional Capacity for Implementation and  Moderate Sustainability Fiduciary  Moderate Environment and Social  Moderate Stakeholders  Moderate Other  Moderate Overall  Moderate OPS_DETAILEDCHANGES_COMPLIANCE_TABLE COMPLIANCE Safeguard Policies Safeguard Policies Triggered Current Proposed Environmental Assessment (OP) (BP 4.01) Yes Yes Performance Standards for Private Sector No No Activities OP/BP 4.03 Natural Habitats (OP) (BP 4.04) Yes Yes Forests (OP) (BP 4.36) No No Pest Management (OP 4.09) No No The World Bank Vietnam Road Asset Management Project (P123961) Physical Cultural Resources (OP) (BP 4.11) No No Indigenous Peoples (OP) (BP 4.10) No Yes Involuntary Resettlement (OP) (BP 4.12) Yes Yes Safety of Dams (OP) (BP 4.37) No No Projects on International Waterways (OP) (BP No No 7.50) Projects in Disputed Areas (OP) (BP 7.60) No No OPS_DETAILEDCHANGES_LEGCOV_TABLE LEGAL COVENANTS Loan/Credit/TF Description Status Action Finance Agreement :Section 1 of Schedule 2 | Description :The Recipient shall maintain the IDA-53310 implementation arrangements as described in Section 1 Complied with No Change of Schedule 2 to the Financing Agreement. | Frequency :CONTINUOUS The Recipient shall ensure, that all terms of reference for any technical assistance or studies carried out under IDA-53310 Not yet due New the Project are consistent with, and pay due attention to, the Association’s Safeguards Policies. The Recipient shall implement in a timely manner the Environmental Management Plans and the Ethnic IDA-53310 Not yet due New Minority Development Plans, all acceptable to the Association. The Recipient shall ensure that all bidding documents and contracts for civil works under the Project include IDA-53310 the obligation of contractors, subcontractors and Not yet due New supervising entities as set forth under paragraph 8 of . Section IV.D of Schedule 2 to the Financing Agreement. The World Bank Vietnam Road Asset Management Project (P123961) . Results framework COUNTRY: Vietnam Vietnam Road Asset Management Project Project Development Objectives(s) The proposed Project Development Objective (PDO) is to improve the efficiency and sustainability of the national road asset management and maintenance practices performed by the Ministry of Transport on national roads in Vietnam. Project Development Objective Indicators by Objectives/ Outcomes RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 Improve the efficiency and sustainability of the national road asset management and maintenance Roads rehablitated 0.00 17,748.00 (CRI, Kilometers) Action: This indicator has been Revised Roads rehabilitated - non-rural (CRI, 0.00 17,748.00 Kilometers) Annual and mid-term (3 years) plans for priority and implementation of national road network No Yes Yes maintenance and long- term (10 years) maintenance strategy generated by RAMS (Yes/No) The World Bank Vietnam Road Asset Management Project (P123961) RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 Action: This indicator has been Revised Expansion of PBC program in national 0.00 100.00 200.00 400.00 700.00 1,000.00 1,400.00 1,700.00 17,000.00 road maintenance (Kilometers) Action: This indicator has been Revised Improved financing of road maintenance measured by the 70.00 70.00 75.00 80.00 85.00 90.00 95.00 100.00 100.00 increased maintenance financing covered by the RMF (Percentage) Action: This indicator has been Revised PDO Table SPACE Intermediate Results Indicators by Components RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 Component A: Road Asset Management System (RAMS) Development Annual condition measurement for 0.00 8,000.00 17,718.00 17,718.00 17,718.00 17,718.00 17,718.00 17,748.00 national road network (Kilometers) The World Bank Vietnam Road Asset Management Project (P123961) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 Action: This indicator has been Revised Component B: Road Asset Preservation PBC maintenance implemented under the 0.00 50.00 124.00 234.00 170.00 170.00 170.00 170.00 project (Kilometers) Km of roads maintained under the project with 0.00 161.00 120.00 161.00 161.00 161.00 168.50 traditional input method (Kilometers) Rationale: Traditional maintenance was implemented from 2015 and completed in 2016: NH48 (length of 46km: km0–km20 and km38-km64) and NH6 (length of 114.7 km: Action: This indicator has km78+300-km193). It is planned to use the project savings to maintain NH6 section Km70-km78 with length of 7.65 km. Total km of roads to be maintained under been Revised the project with traditional input method will be about 168.35 km. Component C: Road Asset Improvement Km of roads improved under the project 0.00 30.00 40.00 56.00 79.90 108.50 (Kilometers) Rationale: Package CP1: Improvement of Trang Thua and Cong Neo bridges on NH38B and Package CP1A: Improvement of Trang, Cap bridges on NH38B and Go bridge on NH39: completed with total length is about 7 km. Package CP14: Improvement of Nh39 (Km91+000-Km107+522) section Vo Hoi – Diem Dien: completed with total length is about 12.71 km. Package CP13: Improvement of NH39 (Km42+714-Km64+000) section Trieu Duong – Hung Ha and 02 briges: Nai and Dong Tu: Action: This indicator has completed with total length is about 19.07 km. Package CP12: Improvement of NH38 (section Quan Goi – Yen Lenh bridge km33+960-Km52+600) : completed with been Revised length of about 20.86 km . It is planned to use the project savings to invest in Son La city bypass, NH6 section Km289+950-Km308+820 with length of 18.87 km and NH2 section Km284+600-Km285+995 with length of 1.39 km. Total km of roads to be improved under the project with traditional input method will be about 79.90 km. The World Bank Vietnam Road Asset Management Project (P123961) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 Roads in good and fair condition as a share of 70.00 70.00 71.00 72.00 72.00 72.00 72.00 total classified roads (Percentage) Size of the total classified network 17,748.00 17,748.00 17,748.00 17,748.00 17,748.00 17,748.00 17,748.00 (Kilometers) Component D: Institutional Strengthening Program Semi-annual Project Monitoring and Evaluation Report will be 0.00 6.00 8.00 10.00 12.00 14.00 14.00 submitted to the Bank (Number) Percentage of affected households having woman attended 50.00 50.00 60.00 70.00 80.00 82.82 consultation activities on compensation/resettlem ent (Percentage) Annual audit of Road Maintenance Fund No Yes Yes Yes Yes Yes Yes published and available for civil society (Yes/No) IO Table SPACE The World Bank Vietnam Road Asset Management Project (P123961) Annex 1: Vietnam map The World Bank Vietnam Road Asset Management Project (P123961) Annex 2 : Procurment Analysis PROPOSED UPDATED NCB ANNEX ANNEX to SCHEDULE 2 National Competitive Bidding Procedures The procedures to be followed for the procurement of goods, non-consulting services, and works under contracts awarded on the basis of National Competitive Bidding shall be those set forth in: (a) Article 20 on Open Bidding of the Recipient’s Law on Procurement No. 43/2013/QH13 dated November 26, 2013 and related provisions necessary to effect the same; and (b) the Recipient’s Decree No. 63/2014/ND-CP dated June 26, 2014 Guiding Implementation of the Law on the Procurement (collectively, “National Procurement Laws”), subject to the provisions of Section I and Paragraphs 3.3 and 3.4 of the “Guidelines for Procurement of Goods, Works, and Non-Consulting Services under IBRD Loans and IDA Credits & Grants by World Bank Borrowers” dated January 2011 (“the Procurement Guidelines”) and the following provisions: Conflict of Interest 1. A bidder shall not have a conflict of interest. Any bidder found to have a conflict of interest shall be ineligible for award of a contract. The provisions on conflict of interest as stated under Section I of the Procurement Guidelines shall apply. Eligibility 2. The eligibility of bidders shall be as defined under Section I of the Procurement Guidelines; accordingly, no bidder or potential bidder shall be declared ineligible for contracts financed by the Association for reasons other than those provided in Section I of the Guidelines. Foreign bidders shall be eligible to participate in bidding under the same conditions as national bidders. In particular, no domestic preference over foreign bidders shall be granted to national bidders in bid evaluation, nor shall foreign bidders be asked or required to form joint ventures with or be subcontractors to national bidders in order to submit a bid. 3. Government-owned enterprises or institutions of the Recipient’s country are eligible to bid in the Recipient’s country only if they can establish that they: (i) are legally and financially autonomous, (ii) operate under commercial law, and (iii) are not dependent agencies of the Recipient or Sub-Borrower. Time for Bid Preparation 4. The time allowed for the preparation and submission of bids for large and/or complex packages shall not be less than thirty (30) days from the date of the invitation to bid or the date of availability of the bidding documents, whichever is later. Standard Bidding Documents 5. The standard bidding documents acceptable to the Association shall be used. The World Bank Vietnam Road Asset Management Project (P123961) Bid Opening and Bid Evaluation 6. Bids shall be opened in public, immediately after the deadline for submission of bids, regardless of the number of bids received. 7. Evaluation of bids shall be made in strict adherence to the criteria that shall be clearly specified in the bidding documents and quantified in monetary terms for evaluation criteria other than price; merit points shall not be used in bid evaluation. No bid shall be eliminated from detailed evaluation on the basis of minor, non-substantive deviations. The evaluation of bidder’s qualifications shall be conducted separately sub-sequent to the technical and commercial evaluation of the bid. 8. A contract shall be awarded, within the period of the validity of bids, to the bidder who meets the appropriate standards of capability and resources and whose bid has been determined (i) to be substantially responsive to the bidding documents and (ii) to offer the lowest evaluated cost. A bidder shall neither be required nor permitted, as a condition for award, to undertake obligations not specified in the bidding documents or otherwise to modify the bid as originally submitted. 9. No bid shall be rejected on the basis of a comparison with the employer’s estimate and budget ceiling without the Association’s prior written agreement. Rejection of All Bids and Re-bidding 10. Rejection of all bids is justified when there is lack of effective competition, or all bids are not substantially responsive, or no bidder meets the specified qualification criteria, or the bid price of the lowest evaluated winning bid is substantially higher than the Recipient’s updated estimated cost or available budget. All bids shall not be rejected or new bids solicited without the Association’s prior written agreement. Complaints by Bidders and Handling of Complaints 11. The Recipient shall implement an effective and independent complaints mechanism, acceptable to the Association, allowing bidders to complaint and have their complaints handled in a timely manner. The World Bank Vietnam Road Asset Management Project (P123961) Annex 2.2 - Updated Implementation Plan (Procurement) Procurement Plan for Additional Works, Goods, Consultants and Non-Consulting Services using Project Savings - Updated on Dec 2, 2020 A. Consulting Services Contract Commencement Date RFP/Bids document Issued Completion of the contract Draft Negotiated Contract Recommendation. to WB and Financial Proposals Bid document, ITB/ITQ, Public Opening of Bids Procurement method Receipt of Proposals Bank's NOL to BER/ Eval Rep to the WB Costs, Spec, TOR, Submission to WB Submission to WB Prior/ Post Review REOI and ITB/ITQ Submission Tech Advertisement of REOI. Complete. Contract signing Estimated value (excluded tax) Contract code Detail Design, Shortlist, RFP BER & Award No. contracts REOI, TOR PP Status (x$1000) Component and Notes Type No. Contract description 1 1 2 3 4 5 6 7 8 9 11 12 13 14 15 16 17 18 19 20 21 11 0 A. Consulting Services 3 1,005 Ma Au De May- Jun- Jan Mar Jun Jul- P N/A y- N/A N/A N/A g- c- 20 20 -21 -21 -21 21 QCBS 21 21 22 Supervision (national RAI/CS of civil work B C Po R 1 ly 1 835 10 contracts 5 S st advertis (#2) ed) A No Dec- Dec- Jan Mar Apr Jun Jul- P N/A N/A N/A N/A N/A v- 20 20 -21 -21 -21 -21 21 Social & 22 RAI/CS Environment C C Po 2 CQS 1 120 R 11 al Monitoring 3 S st (#2) A Se Ma To Mar- Apr- May Jun Jul- Jun External P N/A N/A N/A N/A N/A p- r- cover RAI/CS C C Po 21 21 -21 -21 21 -23 3 Financial CQS 1 50 21 22 the FA 12 4 S st Audit (#3) extensi R on The World Bank Vietnam Road Asset Management Project (P123961) period + A grace period B. Works 7 29,53 9 Son La city Se No Apr- May- May Jun Jul- Oct bypass, NH6 P N/A N/A N/A N/A N/A p- v- 21 21 -21 -21 21 -21 section NCB 21 22 RAP/CP C Po 9 Km289+950- W e- 1 4,462 18 1 st R Km293+500 bidding Length: 3,55 A km Se No Son La city Apr- May- May Jun Jul- Oct P N/A N/A N/A N/A N/A p- v- bypass, NH6 21 21 -21 -21 21 -21 NCB 21 22 1 RAP/CP section C Po W e- 1 5,028 0 18 Km293+500- 1 st R bidding Km297+500 Length: 4 km A Se No Son La city Apr- May- May Jun Jul- Oct P N/A N/A N/A N/A N/A p- v- bypass, NH6 21 21 -21 -21 21 -21 NCB 21 22 1 RAP/CP section C Po W e- 1 5,028 1 19 Km297+500- 1 st R bidding Km301+500 Length: 4 km A Se No Son La city Apr- May- May Jun Jul- Oct P N/A N/A N/A N/A N/A p- v- bypass, NH6 21 21 -21 -21 21 -21 NCB 21 22 1 RAP/CP section C Po W e- 1 5,028 2 20 Km301+500- 1 st R bidding Km305+500 Length: 4 km A Son La city Se No Apr- May- May Jun Jul- Oct bypass, NH6 P N/A N/A N/A N/A N/A p- v- 21 21 -21 -21 21 -21 section NCB 21 22 1 RAP/CP C Po Km305+500- W e- 1 4,176 3 20 1 st R Km308+820 bidding Length: 3.32 A km Se Se Apr- May- May Jun Jul- Oct P N/A N/A N/A N/A N/A p- p- NH2 section 21 21 -21 -21 21 -21 NCB 21 22 1 RAP/CP Km284+600 C Po W e- 1 4,016 4 21 - 1 st R bidding Km285+995 A NH6 section NCB Ma Au Se Au 1 RAI/CP C Po Apr- Apr- May Jul- Km70+650- W e- 1 1,801 P N/A y- N/A N/A N/A N/A g- p- g- 5 22 1 st 21 21 -21 21 Km78+300 bidding 21 21 21 22 The World Bank Vietnam Road Asset Management Project (P123961) (Hoa Binh) R A Abbreviat ion CQS - Consultant CS - Selection of Consulting Qualification NCB - National Services Selection Tr - Training Competitive Bidding SSS - Single LCS - Least G - Procurement of Goods Source selection Cost Selection NS - National Shopping QCBS - ICB - International Quality and Competitive Cost Based W - Procurement of Works Bidding Selection DC - Direct Contracting The World Bank Vietnam Road Asset Management Project (P123961) Annex 2.3 –Implementation Plan (Disbursement) Procurement method Est. Disbursement Estimated value (excluded tax) Contract code No. contracts (x$1000) Component and Contract Type No. description 31- 30- 31- 30- 1 2 3 4 5 6 7 8 Dec- Jun- Dec- Apr-23 21 22 22 A. Consulting Services 3 1,005 QCBS Supervision of civil 1 RAI/CS10 B5 CS (nationally 1 835 125 167 251 292 work contracts (#2) advertised) Social & 2 RAI/CS11 Environmental C3 CS CQS 1 120 18 24 36 42 Monitoring (#2) External Financial 3 RAI/CS12 C4 CS CQS 1 50 25 25 Audit (#3) B. Works 7 30,885 Son La city bypass, NH6 section NCB 9 RAP/CP18 Km289+950- C1 W 1 4,800 720 960 1,680 e-bidding 1,440 Km293+500 Length: 3,55 km Son La city bypass, NCB 10 RAP/CP18 NH6 section C1 W 1 5,100 765 1,785 e-bidding 1,020 1,530 Km293+500- The World Bank Vietnam Road Asset Management Project (P123961) Km297+500 Length: 4 km Son La city bypass, NH6 section NCB 11 RAP/CP19 Km297+500- C1 W 1 5,100 765 1,785 e-bidding 1,020 1,530 Km301+500 Length: 4 km Son La city bypass, NH6 section NCB 12 RAP/CP20 Km301+500- C1 W 1 5,100 765 1,785 e-bidding 1,020 1,530 Km305+500 Length: 4 km Son La city bypass, NH6 section NCB 13 RAP/CP20 Km305+500- C1 W 1 4,500 675 900 1,575 e-bidding 1,350 Km308+820 Length: 3.32 km NH2 section NCB 14 RAP/CP21 Km284+600 - C1 W 1 4,485 673 897 1,570 e-bidding 1,346 Km285+995 NH6 section Km70+650- NCB 15 RAI/CP22 C1 W 1 1,800 270 360 540 630 Km78+300 (Hoa e-bidding Binh) Total 31,890 4,776 6,368 9,577 11,169 The World Bank Vietnam Road Asset Management Project (P123961) Annex 3: Technical Appraisal 1. For all the sub-projects, especially for the new construction road of Son La city by pass of NH6, technical solution was flexibly applied for geometric design by sections with limited geometric condition of sharper horizontal curve radius and steeper longitudinal slope compared with the corresponding parameters follows the road standard. These solutions are for being consistent with hardly terrain condition and for natural based resilience. However, it is necessary for solutions of traffic calming and sufficient facilities for the limited geometric condition sections included transition parts of these sections. The solutions need to be clear in detailed design period. 2. It is mentioned in the revised FS report for pavement design of new construction and pavement strengthening were calculated and analyzed follows current local flexible pavement design and based on traffic condition and the pavement structures of adjacent section roads on NH6 and NH2 corresponding of the sub-project. The result is minimum modulus of pavement follows road class were selected for the road sub-project. Pavement structure, especially for the new construction sub-project of Son La city by-pass, needs be checked and analyzed using axle loading data estimated from traffic survey. It is noted that commercial vehicles, particularly all trucks and heavy trucks, will take the bypass road. This work must be done at detailed design period. 3. The existing drainage system on strengthening road of NH6 and NH2 were assessed for sufficiency of capacity and structural condition. Technical solutions of maintaining existing culverts, increasing flow capacity of culverts, and adding side drain section based on the assessment. For detailed design, the assessment should be individually implemented for each drainage structure considering climate change adaption. It was mentioned in the revised FS report for hydrological analysis for the drainage structures on the new road construction projects of Son La city bypass on NH6. However, climate changes condition and technical solutions for climate adaption was not clearly in the revised FS report. It should be considered for detailed technical solutions for drainage structure calculation and analysis at hydrologic aspects for providing sufficient capacity of drainage structures (of bridges, culverts and drains) to adapt climate conditions. 4. Retaining walls were proposed at the sections where are potentially land sliding in the new construction road sub- project of Son La bypass. Concrete gravity retailing wall was proposed for cutting road slope stability and soil reinforcing retaining wall were proposed for filling cut slope stability. Investigation for the risks of land sliding individually at each section must be done follows technical guideline of climate vulnerability assessment for final technical solutions. Comprehensive technical solutions combining surcharge slope reduction, bio-engineering, drainage with structures such as gravity concrete wall must be considered for a sustainable and climate adaptable technical solution. For 02 other sub-projects of road improvement, it is necessary for assessment of roadbed stability at sections for sufficient technical solutions. At detailed design stage, all 03 proposed sub-projects must be assessed for climate vulnerability for other risky climate, i.e. flooding and flush flood in the areas along the road sections for the appropriate technical solutions. 5. Traffic safety was taken account in the revised FS with effective solutions of intersection design, sight distance clearance in sharp horizontal curves, and principally designed of traffic safety facilities of traffic sign, road marking and side post, etc. follows current road safety standard. It is noted for traffic safety individually audited and designed at location and section. Cross-roads must be included for not only pavement taping, but also for traffic safety design. At the cross-road location, beside conventional design of traffic signs and road marking, longitudinal slope of the crossing roads and sight distance must be checked for appropriate technical solutions. Long enough homogenous section at traffic safety aspects for speed control must be ensured for safely and conveniently movement of all vehicles of the The World Bank Vietnam Road Asset Management Project (P123961) traffic flow. All the mentioned notifications need be implemented at detailed design stage. There is a need to detail the climate change adaptation measures where appropriate in the technical designs, particularly for drainage and earthwork protection. The location and extent of adaptation measures should be informed by Climate Vulnerability Assessments surveys and designed in detail accordingly. The World Bank Vietnam Road Asset Management Project (P123961) Annex 4: Economic analysis 1. Taking a combination of three proposed activities as a single project, the results of the economic evaluation, including the ERR value of 20.33 percent, and the NPV of 479.07 (VND billion), is presented in table 4: Table 4. Economic benefits are the benefits that society gains from the project's fulfilling of overall socio-economic goals. Criteria Value 479.07 (VND billion) NPV ~ 20.77 ($ million) ERR (%) 20.33% Benefit to Cost Ratio (B/C) 1.579 2. Besides, the annual cash flows of the additional projects (considered as one single project) are shown in Table 5. The discount rate is taken as 12 percent for the calculation. The construction costs are estimated at 85 percent of the total costs, excluding the management fees, consultancy expense, and unforeseen costs/expenses. Table 5. Summary of Economic Costs and Benefit flows Cost (VND million) Benefits (VND million) Eq. Year Total NPV VOC Time Total Year Costs M&O costs Total costs TDC TDB savings savings benefits 2020 -3 ,000 ,000 ,000 2021 -2 ,000 ,000 ,000 2022 -1 ,000 ,000 ,000 ,000 2023 1 676,093 4,024 680,116 607,247 - 10.318 103.043 92.724 82.790 - 587.392 - 524.457 2024 2 4,265 4,265 3,400 - 12.863 110.215 97.353 77.609 93.087 - 450.248 2025 3 4,521 4,521 3,218 - 13.448 117.699 104.251 74.204 99.730 - 379.262 2026 4 4,792 4,792 3,046 - 14.033 125.528 111.495 70.857 106.703 - 311.451 2027 5 5,080 5,080 2,882 - 14.619 133.728 119.110 67.586 114.030 - 246.747 2028 6 48,260 48,260 24,450 - 15.204 142.327 127.124 64.405 78.863 - 206.792 2029 7 5,708 5,708 2,582 - 15.789 151.355 135.566 61.323 129.859 - 148.051 2030 8 6,050 6,050 2,444 - 16.374 160.845 144.470 58.349 138.420 - 92.145 2031 9 6,413 6,413 2,313 - 16.959 170.830 153.870 55.487 147.457 - 38.970 2032 10 6,798 6,798 2,189 - 17.545 181.348 163.803 52.740 157.005 11.581 2033 11 64,583 64,583 18,566 - 18.130 192.440 174.310 50.110 109.727 43.125 2034 12 7,638 7,638 1,960 - 18.715 204.147 185.432 47.596 177.794 88.760 2035 13 8,096 8,096 1,855 - 19.300 216.518 197.217 45.197 189.121 132.102 2036 14 8,582 8,582 1,756 - 19.886 229.600 209.715 42.912 201.133 173.258 2037 15 9,097 9,097 1,662 - 20.471 243.449 222.978 40.737 213.881 212.333 2038 16 711,749 711,749 116,102 - 21.056 258.120 237.064 38.670 - 474.685 134.901 2039 17 10,221 10,221 1,489 - 21.641 273.677 252.036 36.708 241.814 170.120 The World Bank Vietnam Road Asset Management Project (P123961) 2040 18 10,835 10,835 1,409 - 22.226 290.185 267.958 34.845 257.124 203.557 2041 19 11,485 11,485 1,333 - 22.812 307.715 284.903 33.079 273.419 235.302 2042 20 12,174 12,174 1,262 - 23.397 326.344 302.948 31.406 290.774 265.446 2043 21 115,658 115,658 10,705 - 23.982 346.155 322.173 29.820 206.515 284.561 2044 22 13,679 13,679 1,130 - 24.567 367.236 342.669 28.319 328.990 311.749 2045 23 14,499 14,499 1,070 - 25.152 389.682 364.530 26.898 350.030 337.577 2046 24 15,369 15,369 1,013 - 25.738 413.595 387.858 25.553 372.488 362.118 2047 25 16,291 16,291 0,958 - 26.323 439.085 412.762 24.280 396.471 385.440 2048 26 154,777 154,777 8,129 - 26.908 466.270 439.362 23.076 284.585 400.386 2049 27 18,305 18,305 0,858 - 27.493 495.276 467.783 21.936 449.478 421.464 2050 28 19,403 19,403 0,812 - 24.871 526.127 501.256 20.987 481.853 441.639 2051 29 20,568 20,568 0,769 - 25.410 559.192 533.782 19.955 513.215 460.824 2052 30 21,802 21,802 0,728 - 25.949 594.519 568.570 18.978 546.768 479.074 * Eq. = Equivalent ; VOC=Vehicle operating cost; M&O=Maintenance and Operation costs; TDB=Total discounted benefits; TDC=Total discounted cost 3. In addition, a sensitivity analysis is performed to evaluate the change of ERR regarding the changes in different affecting factors. Changes in the benefit and cost streams, taking into account various scenarios are shown in Table 6: Table 6. Sensitivity Analysis ERR Scenarios (percent) 1. Base case 20.33 2. Costs increase by 20 percent 17.19 3. VOC decreases by 20 percent 19.84 4. Base traffic decreases by 20 percent 15.64 5. Combination of 2 and 3 16.80 4. The sensitivity analysis shows that the ERR is more sensitive to base-year traffic, and traffic changes, following by the costs. In the severe case when the base traffic decreases by 20 percent, the ERR remains at 15.64 percent, which remains a reasonable ERR value. Risk analysis shows that the likelihood of the project not reaching an ERR of 12 percent is less than 1 percent. From the above results of the evaluation criteria, it is demonstrated that the project is economically effective. Investment in the Project will bring significant benefit to the society and community, and is strategic in the socio-economic development of the studied areas. The World Bank Vietnam Road Asset Management Project (P123961) Annex 5: Results Framework Project Development Objective Indicators PHINDPDOTBL  Annual and mid-term (3 years) plans for priority and implementation of national road network maintenance and long- term (10 years) maintenance strategy generated by RAMS (Yes/No, Custom) Baseline End Target (2020) End Target (2022) Value N Y Y Date 31-Oct-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional): PHINDPDOTBL  Improved financing of road maintenance measured by the increased maintenance financing covered by the RMF (Percentage, Custom) Baseline End Target (2020) End Target (2022) Value 70.00 100.00 100.00 Date 31-Oct-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional) Base year demand is US$ 360 million. PHINDPDOTBL  Expansion of PBC program in national road maintenance (Kilometers, Custom) Baseline End Target (2020) End Target (2022) Value 0.00 17,000.00 17,000.00 The World Bank Vietnam Road Asset Management Project (P123961) Date 31-Oct-2013 31-Dec-2020 31-Dec-2022 Comments Overall Comments Intermediate Results Indicators PHINDIRITBL  Annual condition measurement for national road network (Kilometers, Custom) Baseline End Target (2020) End Target (2022) Value 0.00 17,748.00 17,748.00 Date 20-Sep-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional)  PBC maintenance implemented under the project (Kilometers, Custom) Baseline End Target (2020) End Target (2022) Value 0.00 170.00 234.00 Date 20-Sep-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional) Sections of NH2 (km163-Km287) with total length of 124 km are being maintained under PBC method from 2015. Sections of NH6 (Km193-Km303) with length of 110 km are being maintained under PBC method from 2016. These contracts under VRAMP will last for 5 years for NH2 and 4 years for NH6 The World Bank Vietnam Road Asset Management Project (P123961) PHINDIRITBL PHINDIRITBL Km of roads maintained under the project with traditional input method (Kilometers, Custom) Baseline End Target (2020) End Target (2022) Value 0.00 161 168.35 Date 20-Sep-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional) Traditional maintenance was implemented from 2015 and completed in 2016: NH48 (length of 46km: km0–km20 and km38-km64) and NH6 (length of 114.7 km: km78+300-km193). It is planned to use the project savings to maintain NH6 section Km70-km78 with length of 7.65 km. Total km of roads to be maintained under the project with traditional input method will be about 168.35 km. PHINDIRITBL  Km of roads improved under the project (Kilometers, Custom) Baseline End Target (2020) End Target (2022) Value 0.00 56 79.90 Date 20-Sep-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional) Package CP1: Improvement of Trang Thua and Cong Neo bridges on NH38B and Package CP1A: Improvement of Trang, Cap bridges on NH38B and Go bridge on NH39: completed with total length is about 7 km. Package CP14: Improvement of Nh39 (Km91+000- Km107+522) section Vo Hoi – Diem Dien: completed with total length is about 12.71 km. Package CP13: Improvement of NH39 (Km42+714-Km64+000) section Trieu Duong – Hung Ha and 02 briges: Nai and Dong Tu: completed with total length is about 19.07 km. Package CP12: Improvement of NH38 (section Quan Goi – Yen Lenh bridge km33+960-Km52+600) : completed with length of about 20.86 km . It is planned to use the project savings to invest in Son La city bypass, NH6 section Km289+950-Km308+820 with length of 18.87 km and NH2 section Km284+600-Km285+995 with length of 1.39 km. Total km of roads to be improved under the project with traditional input method will be about 79.90 km. The World Bank Vietnam Road Asset Management Project (P123961)  Annual audit of Road Maintenance Fund published and available for civil society (Yes/No, Custom) Baseline End Target (2020) End Target (2022) Value N Y Y Date 20-Sep-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional) PHINDIRITBL The World Bank Vietnam Road Asset Management Project (P123961)  Roads in good and fair condition as a share of total classified roads (Percentage, Custom) Baseline End Target (2020) End Target (2022) Value 70.00 72.00 72.72 Date 20-Sep-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional) Based on the Intermediate results of Component Two – Road Asset Preservation, 168.35 km road to be maintained under traditional maintenance contracts, and 234 km road has been rehabilitated under PBC maintenance contracts, 79.90 km road to be improved under improvement contracts. In total, 482.25 km will be traditionally maintained/rehabilitated/improved under the Project. Thus, roads in good and fair condition as a share of total road network due to the project will increase from 70% to 72.72% (total number of km road to be traditionally maintained/rehabilitated/improved under VRAMP /total number of km national roads = 482.25/17,748 km =2.72%).  Percentage of affected households having woman attended consultation activities on compensation/resettlement (Percentage, Custom) Baseline End Target (2020) End Target (2022) Value N/A 80% 80% Date 20-Sep-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional)  Semi-annual Project Monitoring and Evaluation Report will be submitted to the Bank (Number, Custom) Baseline End Target (2020) End Target (2022) Value 0.00 14.00 18.00 Date 20-Sep-2013 31-Dec-2020 31-Dec-2022 Hide Comments Target, M&E Plan Trend Comment on this Indicator (optional) The World Bank Vietnam Road Asset Management Project (P123961) PHINDIRITBL Overall Comments