Document of The World Bank FOR OFFICIAL USE ONLY Report No.: 20332 IMPLEMENTATION COMPLETION REPORT THE UNITED REPUBLIC OF TANZANIA INTEGRATED ROADS PROJECT (CREDIT 2149-TA) April 20, 2000 AFT: Transport 1 Africa Region 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 (As of March 31, 1990) SDR 1.0 = US$1.29; US$ 1.0= SDR 0.78 Tsh 1.0 = US$ 0.005; US$ 1.0 = Tsh 200 (As of June 30,1999) SDR 1.0 = US$1.20; US$ 1.0= SDR 0.83 Tsh 1.0 = US$0.001; US$ 1.0 = Tsh 716 Currency Unit Tanzanian Shilling Fiscal Year July 1 to June 30 ABBREVIATIONS AND ACRONYMS AfDB African Development Bank ATAP Agricultural Transport Assistance Program CODAP Coordination Office for Donor Assisted Projects CRRP Core Rural Roads Program DANIDA Danish International Development Agency EIRR Economic Rate of Return ERP Economic Recovery Program EU European Union FINNIDA Finish International Development Agency GOT Government of Tanzania GTZ Deuche Gesellchaft fur Technishe Zusammenarbeit IDA International Development Association IRP 1, 11 Integrated Roads Project 1, II MCT Ministry of Communications and Works MCWT Ministry of Communications Works and Transport MOW Ministry of Works NORAD Norwegian Agency for Development Co-operation NTC National Transport Agency PEHCOL Plant and Equipment Hire Company Limited RETCO Regional Transport Company Ltd. SAR Staff Appraisal Report TANRROADS National Roads Agency TANZAM Tanzania-Zambia UDR Shirika la Usafari Dar es Salaam Ltd. UNCDF United Nations Capital Development Fund UNDP United Nations Development Program USAID United States Agency for International Development Vice President: Callisto E. Madavo, AFRVP Country Director: James W. Adams, AFMTZ Sector Manager: Yusupha Crookes, AFTT1 Task Manager: Yitzhak Kamhi, AFTTI Tanzania: Integrated Roads Project Preface Implementation Completion Report THE UNITED REPUBLIC OF TANZANIA INTEGRATED ROADS PROJECT (Credit 2149-TA) IMPLEMENTATION COMPLETION REPORT PREFACE This is the Implementation Completion Report (ICR) for the Integrated Roads Project (Credit - 2194-TA) to The United Republic of Tanzania for which SDR 139.9 million (US$180.4 million equivalent) was approved on May 31,1990 and made effective on March 15,1991. The Credit 2149-TA was partially closed on June 30, 1998, the original closing date. It was fully closed on June 30, 1999 after a year extension from the original closing date of June 30, 1998. Sixteen donors provided parallel financing for the project. Final disbursement of IDA credit was made on December 13, 1999. A total of USD 31,165,978.54 equivalent (SDR 22,695,381.36) was cancelled from the credit on December 21, 1999. Yitzhak Kamhi, Task Team Leader (AFTT1) and Ephrem Asebe (consultant) prepared the ICR. The ICR was reviewed by Messrs. James W. Adams, Country Director for Tanzania, and Yusupha Crookes, Sector Manager, Africa Region. Preparation of this ICR began during the Bank's ICR mission in November 1999. It is based on material in the project file. The Borrower contributed to the preparation of the ICR by stating its views as reflected in the mission's Aide-Memoire (Annex A), and by preparing its own evaluation of the project's execution (Annex C). Annex B also includes the views of some co-financiers. FOR OFFICLAL USE ONLY CONTENTS PAGE No. PREFACE EVALUATION SUMMARY ........................................................... i-V PART l: PROJECT IMPLEMENTATION ASSESSMENT ........................................................... 1 A. PROJECT OBJECTIVES AND DESCRIPTION ........................... ................................ I B. ACHIEVEMENT OF PROJECT OBJECTIVES ........................................................... 3 C. MAJOR FACTORS AFFECTING THE PROJECT ............................................ ............... 9 D. PROJECT SUSTAINABILITY ........................................................... 11 E. BANK PERFORMANCE ........................................................... 11 F. BORROWER PERFORMANCE ........................................................... 13 G. ASSESSMENT OF OUTCOME ........................................................... 14 H. FUTURE OPERATIONS ........................................................... 14 I. KEY LESSONS LEARNED . - ............................................................ 15 PART II: STATISTICAL TABLES ........................................................... 17 TABLE 1: SUMMARYOFASSESSMENTS .................... ....................................... 17 TABLE 2: RELATED BANK LOANSICREDITS .............................. ............................. 18 TABLE 3: PROJECT TIMETABLE ........................................................... 19 TABLE 4: LOAN/CREDIT DISBURSEMENT: CUMULATIVE ESTIMATE AND ACTUAL .......... .......... 19 TABLE 5A: KEY INDICATORS FOR PROJECT IMPLEMENTATION ................................ ................ 20 TRAINING UNDER IDA CREDIT TABLE 5B: KEY INDICATORS FOR PROJECT IMPLEMENTATION ................................................ 21 STATUS OF TRAINED STAFF UNDER IDA CREDIT TABLE 5C: KEY INDICATORS FOR PROJECT IMPLEMENTATION: PEHCOL ................................ 21 TABLE 5D: KEY INDICATORS FOR PROJECT IMPLEMENTATION ................................................ 21 ROAD FUND EXPENDITURE ON ROADS TABLE 6A: KEY INDICATORS FOR PROJECT OPERATION ....................................................... 22 ROADS CONDITION & TARGET ACHIEVEMENTS TABLE 6B: KEY INDICATORS FOR PROJECT OPERATION ....................................................... 23 TRUNK ROAD OPERATIONAL PLAN AND BUDGET TABLE 6C: KEY INDICATORS FOR PROJECT OPERATION ....................................................... 23 RURAL ROADS OPERATIONAL BUDGET AND PLAN TABLE 7: STUDIES INCLUDED IN PROJECT: IDA COMPONENTS ............................. ............... 24 TABLE 8A: PROJECT COSTS (US$ MILLION) ...................... ................................. 24 TABLE 8B: PROJECT FINANCING (US$ MILLION) .................................. ..................... 25 TABLE 9: ECONOMIC COSTS AND BENEFITS ....................................................... 25 TABLE 10: STATUS OF LEGAL COVENANTS ....................................................... 26 TABLE 11: COMPLIANCE WITH OPERATIONAL MANUAL STATEMENTS ................... ................... 28 TABLE 12: BANK RESOURCES: STAFF INPUTS ......................... .............................. 28 TABLE 13: BANK RESOURCES: MISSIONS ................. ...................................... 29 This document (Las a resticted distribution and may be used by recipiens only in the pearfogrmnce of their official duties. Its contents may not otherwise be disclosed without World Bank authorizadion. Tanzania: Integrated Roads Project Page 2 Implementation Completion Report ANNEX A: SUPPLEMENTARY STATISTICS ............................................. 34 TABLE 1: REALLOCATION OF IDA CREDIT .............. ......................................... 34 TABLE 2: STATUS OF IDA FINANCED COMPONENT AS OF PROJECT CLOSING ............. ................... 35 TABLE 3: PROJECT COSTS OF IDA AND OTHER DONORS ...................... ....................... 37 ANNEX B: ICR MISSION'S AIDE MEMOIRE ............................................. 38 ANNEX C: BORROWER'S CONTRIBUTION AND COMMENTS TO ICR ............................................. 43 MAPS: IBRD No. 22067 Tanzania: Integrated Roads Project Page i Implementation Completion Report Evaluation Summary EVALUATION SUMMARY THE UNITED REPUBLIC OF TANZANIA Integrated Roads Project (Credit 2149-TA) Introduction i. Background. With an estimated project cost of US$ 871 million, the Integrated Roads Project I (IRP I) was the largest single road program in the sector in Sub-Sahara Africa. It was a bold experiment in the sector and represented major breaks in the ways road sector projects were designed in the Bank. It pooled resources with parallel financing from IDA, and 15 other donor agencies:-AfDF, UNDP, EEC, DANIDA, Republic of Germany, Italy, FINNDA, ODA (UK), NORAD, USAID, The Netherlands, Ireland, Switzerland, Saudi Fund and Kuwait Funds. ii. The project was launched in 1991 after three years of consultation, to overcome the impact of the deteriorating road network in a context of the economic recovery program the country was then undertaking. During the period, IDA was instrumental in assisting the Government of Tanzania (GOT) to develop IRP I and had assumed responsibility of coordinating donors' assistance. This Implementation Completion Report (ICR) of Integrated Road Project I attempts to sum up the major lessons leamed from implementing the Project. The scope of this ICR is limited to an assessment of IDA financed component of IRP I. Reference to the total project is made where it is essential to the overall understanding of the IDA component. Bank Project iii. Project Objective. As outlined in the Staff Appraisal Report No. 8367-TA, the main objectives of IRP were to: (i) develop MCWT's institutional capacity to manage the networks'; and (ii) restore Tanzania's trunk and regional roads networks, which were obstacles to the sustainability of the economic recovery program. iv. Project Components. The project was to provide financial assistance for (i) institutional support to strengthen road management capacity of the MCWT; (ii) rehabilitation and improvement program of about 4,600 km of trunk roads and 3000 km of regional roads in agriculturally productive areas including related structures and bridges; (iii) road maintenance support to MCWT including establishment of privately operated plant pools, and development of local constructing capacity to undertake road works; and (iv) management assistance to Air Tanzania Corporation and the National Transport Corporation. v. Project Covenants. The critical agreements reached at negotiation were to (i) undertake the main institutional and policy changes prior to project effectiveness, including (a) changes in the procurement regulations, (b) appropriating the agreed road budget for the first year of project implementation, and (c) reorganize the road administration; (ii) appropriating GOT agreed annual road budget as a condition of IDA funding; (iii) complete engineering designs and technical documentation for the first two years of the program prior to board presentation. vi. Project Evaluation. The Integrated Roads Project objectives were very important to the people and Government of Tanzania, and were in line with IDA's sector priority for the country. The design of the project was conceptually clear. The institutional objective was to address the long-term sustainability of the project, while the physical objective was focused on the urgent task of maintenance and rehabilitating the road network to enhance the economic recovery program. Major challenges facing project design were defining an appropriate program size and finding the appropriate tradeoffs between the two major objectives. A key strategy adopted, to assure sustainable of the outcomes of the project, was to address in parallel several development objectives, including transformation of the ministry from blue collar to white collar organization, 1 That is, transform from blue collar to white collar organization. Tanzania: Integrated Roads Project Page ii Implementation Completion Report Evaluation Summary development of a private construction industry, decentralization of the maintenance and rural roads administration, training of manpower, establishment of road fund. But these added to the complexity of the program and the operational strategy had to deal with tradeoffs. Implementation vii. Achievement of the Program Objectives. There is no question that there have been improvement in terms of reductions of transport cost and travel time mainly as result of improvement of certain major links of the country. According to govemment statistics, in 1999 the actual proportion in length of the trunk road network in good, fair and poor conditions were 30%, 39% and 30% of the total trunk roads respectively. This favorably compares to the SAR estimates for 1990/91, the start of the project, which was 26%, 26% and 47% for good, fair and poor roads of the trunk road network length respectively. Between 1990/91 and 1998199, the trunk road network had also increased from 9,629 km to 10,203 km. However, the status of roads in good condition in 1999 which stood at 30% for the trunk roads was significantly below when compared to the appraisal targets of 60% by mid-1996 and 80% by mid-2000. The current condition of rural roads is not know as El Nino has damaged the road constructed. About 2000 km of rural roads were known to have been rehabilitated by the donor community under the IRP I. viii. With respect to the physical achievement under IDA funding, initially a total of 910 km of gravel roads were contracted out. About 683 km of gravel roads were constructed with cost overuns ranging between 65% and 244%. Of the 683 km of constructed roads some 300 km was total loss and some 266 was deteriorated within the first 13 months of construction. The Tanga- Horohoro/Marangu-Tarakea road (118 km) was substantially completed and is now in reasonable good condition; its EIRR is 29%. Regretfully, for the uncompleted and washed out components, the investment value is practically lost, making re-estimation of ERR not worthwhile. Mwanza-Nzega Road (54 km) is yet to be fully completed and no EIRR is estimated. Its designs were not updated before signature of contracts. Field survey was poor and it suffered major claims related to payments delays of GOT portion. The Kayaka bridge and approaches were completed. Implementation experienced many failures of structures, approaches, temporary approaches and bridges. And substantial additional works were carried out after commencement. Six of the seven packages in Emergency Works for Dar es Salaam Roads were implemented. Poor surveys and designs, frequent changes in scope of works resulted in poor quality of works and significant cost increases. Some of the roads also disintegrated soon after completion. Under IDA funding periodic maintenance and emergency works were carried out. The project also funded a portion of TANZAM Highways sections 2, 4 & 5, which were rehabilitated under the Six Highway Rehabilitation Project (Cr,1688-TA). ix. On the institutional front, modest progress has been made towards achieving some of the institutional development objectives. A modest private construction industry has been created. Road maintenance administration has been decentralized in 20 regions. The Road Fund established under the project now can potentially provide some 70% of the required road maintenance funding. Road maintenance expenditure made from the Road Fund has increased from US$7.24 million in 1991/92 to US$22.48 million in 1998/99. The National Road Agency was established in July 1999 and its chief executive took position in February 2000. Significant number of high level manpower has been trained at home and abroad. WVith respect to liberalization, the Plant and Equipment Hire Company is now in the process of privatization. Nevertheless, it is generally agreed by both MOW and donors, that institutional issues, particularly contract administration and project management are still major problems in efficiently managing the road network. Overall, the project achievement is assessed as unsatisfactory. x. Cost and Implementation Time Schedule. At completion, the total funds expended on IRP I was estimated at US$868.0 million including GOT contribution estimated at US$60.0 million. US$166.7 million equivalent (SDR117.2 million) of IDA funds were disbursed and US$ 12.17 million of the original estimates was cancelled along with US$ 19.0 million equivalent from exchange rate savings. However, In spite of its limited impact the cost of institutional support was more than double Tanzania: Integrated Roads Project Page iii Implementation Completion Report Evaluation Summary the appraisal estimates. This applied for both IDA and for the other donors. After allowing for inflation, cost escalation for civil works ranged from 40% to over 125%. xi. Main Factors Affecting Implementation. The factors which were partly outside the government control and which affected the implementation of the project included: difficult environment for implementation; inadequate design of the project; problems in donor coordination and poor performance of consultants and contractors. The factors within the government's control affecting implementation were: lack of good governance including instances of corrupt practices; failure to apply lessons learned from preceding project implementation; lack of proactive response; frequent reorganization of the implementing agencies; inadequate counterpart funding; and poor staff incentives. Factors within the control of the implementing agencies included: substantive changes in the scope of works without proper technical documentation and authorization by funding agencies; prolonged procurement processing; deficient contract administration; and poor project and financial management. Results and Performance xii. Project Sustainability. Overall, the sustainability of the project is assessed as uncertain. It appears that much longer time than originally planned is needed to assure sustainability. Sustainability of the progress made with respect to institutional objective depends on the prevailing environment, government commitment to maintenance-first policy, proactive leadership, the incentive system to skilled manpower and on follow-up measures to consolidate the progress achieved to date - road fund, road agency, etc. The sustainability of the commercialized activities under the liberalization regime depends on the entrepreneurial abilities of the new contractors and their financial capacities. The sustainability of the maintenance system introduced depends on the performance of the economy to generate road fund revenue and eradication of corrupt practices. xiii. Bank Performance. Bank performance in identification and preparation assistance is assessed as satisfactory. IDA staff rightly identified that transport is the major problem facing the Tanzanian economic recovery during its transition to market-oriented economy. During preparation phase, IDA staff provided critical assistance to GOT in coordinating donor assistance and packaging the program. Appraisal was insufficient with respect to considering the appropriate design options for Tanzania, particularly on the scope of institutional reforms to be undertaken. Second, it was known from earlier IDA financed road sector projects that there were major problems in performing basic project activities. Appraisal, thus, did not fully address the major flaws experienced under the Sixth Highway Credit; particularly in respect to contract administration and project and financial management. Those errors were, therefore, repeated on a larger scale. Third, the risks due to lack of incentives to staff to steer the project implementation was identified but an adequate sustainable solution in the context of the civil services was not found. xiv. The overall assessment of supervision must be seen in the context of unduly ambitious and optimistic project design; early successes following initial contract signatures and initial improvements in road conditions; the unclear and conflicting role of the Principal Transport Engineer (PTE) who was advising the government and the Bank management and staff at the same time, and poor governance conditions in the country. Therefore, the implementation of the program basically failed, particularly in the gravel road component, notwithstanding of the efforts of the supervision. Hence, the Bank's supervision performance is rated as marginally unsatisfactory. xv. Borrower Performance. Borrower preparation is assessed as satisfactory. The government's bold initiative in its Transport Sector Policy Paper and its Transport Recovery Program and its ability to bring some 16 donors to agree in support of its program over a period of three years of consultation, was a major undertaking. It showed leadership and built on a reservoir of good will that the government had among the donor community at the time. Coming to closure was a major accomplishment. The govemment, however, was facing serious difficulties in translating its ambitious program on schedule and within planned budget. It has not been able to make best use of the resources at its disposal. Audit reports of project accounts were continuously and seriously Tanzania: Integrated Roads Project Page iv Implementation Completion Report Evaluation Summary qualified. GOT's responses were often not timely and sometimes had required the prodding of the donor community, as in the case of the Road Fund and Road Agency. As evidenced in the 1996 Report on Presidential Commission Inquiry Against Corrupt Practices, the operating environment in the implementing agencies was not conducive to good project management practices. In the area of procurement, project management and contract administration, a decade after the launching of IRP I, despite substantial expenditure of resources2, including manpower training, the evidence is that implementing agencies are only marginally better than they were at the start of the project. xvi. Project Outcome. Overall, the outcome of the IDA financed component is assessed as unsatisfactory. However, as a result of the project, there is today a more organized sector program. The government has learned valuable lessons from its implementation experience. A private sector led road construction sector industry has emerged. Road maintenance is now carried by private contractors who have largely come into existence with the support of the IRP I. Despite the temporary relapse in the administration of the Road Fund in 1995/96, the road fund now contributes a significant share of the cost of maintenance. The road fund is administered by the Road Fund Board supported by the Road Fund Act. The TANROADS is finally going to start fully operating by July 2003. However, impact of transport cost reduction on the macroeconomic situation was not as high as expected at the start of this ambitious program. Also, the basics of project and financial management have yet to be mastered. Key Lessons Learned and Future Actions. xvii. This Integrated Roads Project has been the largest and most ambitious project in the sector. As such it has been the subject of multiple reviews including a recent Bank Quality Assurance Group review. This ICR identifies a number of key lessons for future project design and implementation. Complexity of the Project and Country Absorptive Capacity. Project composition and implementation schedule should match the absorptive capacity of the implementing agency. In design of such large investment, involving several donors, the approach should aim at: (i) a phased investment with a better defined triggers; and (ii) long-term donors support. * Project Design. While the concept of sector investment project on which IRP I is based appears workable, its application to a specific country requires making tradeoffs between major development objectives based on detailed analysis of major risks in achieving those objectives. In particular, in the civil works, the absence of detailed engineering for all major roads immediately prior to start of construction, made variation orders almost inevitable, leading to delays and cost increases. In institutional capacity building too, the many demands for reforms, taxed the capacity of the govemment to deliver on budget and on schedule. Therefore, in projects of IRP I type, it is important to introduce "checks and balances" with early warning signals to be able to adapt the program when required. * Corrupt practices. The poor implementation performance of IRP I testifies that the potential for corrupt practices can significantly impact project implementation performance. In this case, roads that would have been constructed under the project to good standard remained uncompleted partly because of corrupt practices and the absence of systems and procedures that could check against their occurrence. The Government should institute measures to safeguard against such practices. Physical progress should be verified against design specifications. Stringent measures should be taken under situation where audit reports are constantly delayed and qualified in order to fight potential corrupt practices from blossoming. * Learning from Past Mistakes. The lessons of experience of past project implementation were to safeguard against future mistakes both for IDA and the borrower. As a matter of fact, major 2 A total of us $105 million was expended by all donors on capacity building as estimated by Carl Bro International a/s, Comprehensive Review of the IRP, Third Interim Report, Revised June 1997. Tanzania: Integrated Roads Project Page v Implementation Completion Report Evaluation Summary flaws experienced in the Sixth Highway Project Credit were also experienced under IRP 1. For example, appropriate technical documentation and provision of adequate resources should be fully completed before commencement of works. In short, more attention needs to be paid to past lessons of experience during project design and implementation. * Composition of Project Team. Supervision team should have professional mix with key persons being sufficiently experienced in the major fields of a project activities such as engineering, institutional reforms, etc. In addition, there should not be frequent changes of supervision management and teams, in order to ensure continuity and consistency of efforts in achieving quality and quantity of the planned targets. * Technical Documentation. Technical documentation necessary for implementation of civil works should be updated before actual commencement of construction works. * Donor Coordination. The spirit of cooperation of the donor community in support of the Integrated Roads Project I had no parallel. It was the first time so many donors have committed themselves to such a large common program. Unfortunately, in IRP 1, it has not been easy to maintain the interests of all donors' cooperation during implementing phase as each donor focus on execution of its own mini program under the parallel financing arrangement. In future, in large investment supported by several donors, a professional coordination managed by the government should be established, with agreed terms of references. * Technical and Financial Audits. The Government should among other things, carry performance technical and financial audits of the works carried out. Such audits should, besides frequently revisiting the overall status of implementation, also include verification of the physical and financial targets. * Initial Successes in Long-term Program. Usually during the initial phases of project cycle of large programs, there is high optimism of the team involved and there is a tendency to underestimate the operation environment of the specific country for which the project is designed, even when there are potentially implementation problems. Initial successes can mask deficiencies related to preparation, selection of contracts and judgements of capacities. It is therefore important that project implementor should not be taken in by the initial euphoria about early successes, and should continue to ensure that measurable output targets are met. The project should have well defined qualitative and quantitative indicators, which should be adequately designed so that any deviation from initial targets can be detected and corrected in real time. xvii. Key Elements of Future Planned Operation. To lay the foundation for excellence in institution building, there is need to assure that the modest capacity achieved to date under the project, especially the trained manpower and the creation of a road agency, is sustained. Assuring adequate resources for road maintenance will remain essentially an ongoing issue. Given past performance of the economy, efficient and effective use of the available road fund will be another critical area of focus. Tanzania: Integrated Roads Project Page 1 Implementation Completion Report Part 1: Project Implementation Assessment PART 1: PROJECT IMPLEMENTATION ASSESSMENT A. PROJECT OBJECTIVES AND DESCRIPTION Background 1. With an estimated project cost of US$ 871 million, the Integrated Roads Project I (IRP 1) I was the largest single road sector program in the sector in Sub-Sahara Africa. It was a bold experiment in the sector and represented major breaks in ways road sector projects were designed in the Bank. It pooled resources on the basis of parallel financing from IDA, and 15 other donor agencies: -AfDF, UNDP, EEC, DANIDA, Republic of Germany, Italy, FINNDA, ODA (UK), NORAD, USAID, The Netherlands, Ireland, Switzerland, Saudi Fund and Kuwait Funds. 2. The International Development Association (IDA) had been instrumental in assisting the Government of Tanzania (GOT) develop IRP I and had assumed responsibility of coordinating donors' assistance. Prior to the IRP I, the Bank group has extended credits and loans to help finance six highway projects, one trucking project, two railway projects and five port projects. IRP I was designed in support of GOT's economic recovery program. During the 1970s and early 1980s, declining funding for road maintenance resulted in the deteriorating road condition in Tanzania. However, when the Government of Tanzania undertook an Economy Recovery Program starting 1986 designed to liberalize and adjust the economy, it became apparent that the functioning of the transport sector was critical to sustain the momentum of Tanzania's economic recovery. In December 1987, GOT called a Transport Sector Conference. At the Conference, GOT presented a draft National Transport Policy along with a conference document entitled "Programme for Transport Sector Recover'. The GOT initiative was based on a study to improve conditions of rural roads to essential agricultural production area. 3. Following three years of coordination and consultation on basic policy, institutional changes and rehabilitation requirements of the sector needed to adequately respond to the economy, the donor community agreed to support the govemment initiative. GOT committed itself to undertake strategic changes regarding the organization of road maintenance and also pledged to make major shifts in its public expenditure, committing itself to provide 20% of the development budget expenditure for transport infrastructure, and to finance road maintenance from its recurrent budget. Finally, agreement was reached between GOT, IDA and 15 other donor agencies - AfDF, UNDP, EEC, DANIDA, Republic of Germany, Italy, FINNDA, ODA (UK), NORAD, USAID, The Netherlands, Ireland, Switzerland, Saudi and Kuwait Funds - to finance the IRP I. A total of US$756.8 was pledged or secured from the donor community at the launching of IRP for which IDA's contribution was US$180.4 million equivalent. GOT was to cover US$80.5 million and only US$33.8 million or 4% of the total project cost was expected to be filled through future donor coordination conferences. The project would be parallel financed following different implementing procedures. Bilateral donors were to use their own staff to undertake implementation and supervision of components financed by them. Others like IDA considered project implementation and field supervision to be primarily the tasks of GOT and it's implementing agencies. 4. Initially, the ICR was to provide a comprehensive assessment of the IRP I including the outcomes and results of the works financed by all the donors. During the ICR mission, it became apparent that relevant data was not readily available as the government had not kept adequate records and the donor community has almost closed their activities related to the project. It became apparent that undertaking such a task was beyond the budget allocated for the ICR. Thus, the focus of this ICR is mainly on IDA financed component of IRP I. 1 IRP was essentially a program covering not only the road infrastructure but also covering the development of road and air transport sectors Tanzania: Integrated Roads Project Page 2 Implementation Completion Report Part 1: Project Implementation Assessment 5. Project Objective. As outlined in the Staff Appraisal Report No. 8367-TA, the main objectives of IRP were to: (i) develop MCWs institutional capacity to manage the networks; and (ii) restore Tanzanian's trunk and regional roads networks, which have become an obstacle to the sustainability of the economic recovery program. The institutional objective was to focus on: assisting the government in developing strong management and technical capacity to maintain the trunk and regional road networks, and transformation MCWT from a construction-oriented ministry to an administrative/ contract management-oriented ministry. The physical objective was to increase the trunk roads in good condition from 15% to 60%; and to selectively rehabilitate the regional road network initially in eleven of the most agriculturally productive regions thereby increasing the road network in good condition from 10% to 50%; and institute regular maintenance on 80% of the trunk and 60% of the regional road networks. 6. Project Components. The project was to provide financial assistance for: (i) institutional support to strengthen road management capacity of the MCWT; (ii) rehabilitation and improvement program of about 4,600 km of trunk roads; 3000 km of regional roads in agriculturally productive areas, and other related structures and bridges; (iii) road maintenance support to MCWT including establishment of privately operated plant pools and development of local construction capacity to undertake road works; and (iv) management assistance to Air Tanzania Corporation and the National Transport Corporation. 7. Changes in Project Scope. Three amendments to the credit agreement have been undertaken. The first was on August 21, 1991, to include completion of the rehabilitation of three sections of TANZAM highway. The second was on June 19, 1992, to reflect the split in the Ministry of Communications and Works, and establishment of the Plant and Equipment Hire Company. The third amendment October 4, 1992 was to include the establishment of computer course offerings for highway technicians at Dar es Salaam Technical College. In 1995, attempts were made to restructure the project, following failures of gravel roads. However, as CODAP was not prepared to produce documentation for making appropriate decisions, nearly two years would pass before a basis for assessing the status of the utilization of the IDA credits was established. In 1997 agreements were finally reached based on the findings of an independent consultant not to further restructure the project. Instead it was agreed to: (i) give priority to the ongoing contracts; (ii) update the scope of works and quantities before signing any contracts; and (iii) re-orient the training programs to focus more on building capacity particularly contract administration, procurement project management. 8. Project Covenants. The critical agreements reached at negotiation were to: (i) undertake the main institutional and policy changes prior to project effectiveness, including (a) changes in the procurement regulations, (b) appropriating the agreed road budget for the first year of project implementation, and (c) reorganize the road administration; (ii) GOT appropriates agreed annual road budget as a condition of IDA funding; (iii) complete engineering design works for the first two years of the program prior to board presentation; (iv) develop closer coordination among the government, donors and IDA; (v) station in Tanzania an experienced highway engineer from the Bank to assist the government in coordinating implementation of the project. Assessment of Project Objectives. 9. The Integrated Roads Project objectives were very important to the people and Government of Tanzania as the transport sector was the major constraint to the success of the country's Economic Recovery Program. It was also IDA's priority to assist the Government in further development and implementation of specific policy and institutional reforms in the sector, in the context of the continuing ERP and as supported by Bank policy. The project objectives were thus in line with IDA's overall and sector policy for Tanzania. 10. The design of the project was conceptually clear. The institutional objective was to address the long-term sustainability of the project, while the physical objective was focused on the urgent task of maintenance and rehabilitating the road network to enhance the economic recovery program. Tanzania: Integrated Roads Project Page 3 Implementation Completion Report Part 1: Project Implementation Assessment A major challenge facing project design was defining an appropriate program size and finding the appropriate tradeoffs between these two major objectives. A key strategy adopted, to assure sustainable outcomes of the project, was to address in parallel several development objectives, including transformation of the ministry from blue collar to white collar organization, development of a private construction industry, decentralization of the maintenance and rural roads administration, training of manpower, establishment of road fund. But this added to the complexity of the program and the operational strategy had to deal with tradeoffs. For example, the project assumed proper designs and technical documentation would be available prior to commencement of works, but on the grounds of emergency needs, poor and insufficient designs, and weak procurement documentation were actually used. 11. The project was indeed complex given the borrowers implementation capacity - with many development objectives, coordination of several implementing agencies and some sixteen donors, five types of disbursements and an environment of frequent organization changes. Building consensus among the donors was difficult because of different strategies and different aspirations across the donor community. Given the prevailing environment, the motivation of the implementing staff, the readiness of the country for such a huge program, the design of project was also too optimistic while the risks in this respect not properly addressed. The country was already having difficulties in effectively implementing the preceding Sixth Highway Project, a substantially smaller project. B. ACHIEVEMENT OF PROJECT OBJECTIVES 12. Overall Assessment. . There is no question that there have been improvement in terms of reductions of transport cost and travel time mainly as result of improvement of certain major links of the country. According to government statistics, in 1999 the actual proportion in length of the trunk road network in good, fair and poor conditions were 30%, 39% and 30% of the total trunk roads respectively. This favorably compares to the SAR estimates for 1990/91, the start of the project, which was 26%, 26% and 47% for good, fair and poor roads of the trunk road network length respectively. Between 1990/91 and 1998/99, the trunk road network had also increased from 9,629 km to 10,203 km. However, the status of roads in good condition in 1999 which stood at 30% for the trunk roads was significantly below when compared to the appraisal targets of 60% by mid-1996 and 80% by mid-2000. The current condition of rural roads is not know as El Nino has damaged the road constructed. About 2000 km of rural roads were known to have been rehabilitated by the donor community under the IRP I. 13. With respect to the physical achievement under IDA finding, initially a total of 910 km of gravel roads were contracted out. About 683 km of gravel roads were constructed with cost overuns ranging between 65% and 244%. Of the 683 constructed road some 300 km was total loss and some 266 was deteriorated within the first 13 months of construction. The Tanga-Horohoro/Marangu- Tarakea road (118 km) was substantially completed and is now in reasonable good condition; its EIRR is 29%. Regretfully, for these uncompleted and washed out components, the investment value is practically lost, making re-estimation of ERR not worthwhile. Mwanza-Nzega Road (54 km) is yet to be fully completed and no EIRR is estimated.. Its designs were not updated before signature of contracts. Field survey was poor and it suffered major claims related to payments delays of GOT portion. The Kayaka bridge and approaches were completed. Implementation experienced many failures of structures, approaches, temporary approaches and bridges. And substantial additional works were carried out after commencement. Six of the seven packages in Emergency Works for Dar es Salaam Roads were implemented. Poor surveys and designs, frequent changes in scope of works resulted in poor quality of works and significant cost increases. Some of the roads also disintegrated soon after completion. Under IDA funding periodic maintenance and emergency works were carried out. The project also funded a portion of TANZAM Highways sections 2, 4 & 5, which were rehabilitated under the Six Highway Rehabilitation Project (Cr,1688-TA). Tanzania: Integrated Roads Project Page 4 Implementation Completion Report Part 1: Project Implementation Assessment Status of Major IDA funded Civil Works Road Section Expenditure Results (US$) 1. Lusahunga-Usagara (266 kmi) 6,069,740 Works completed, but deteriorated within the first 13 months after rehabilitation. Cost increases of 65% 2.Tundoma/Lichet 8,702,892 Some 50% of 226 km were done. scope of work (Sumbawanga) (226) substantially changed. Work abandoned. Almost total loss of investment. Cost increases of 244% 3. Shelui-SingidalBabati/Bereku 8,178,078 Some 60 % of civil works was completed. (310km) Scope work substantially changed. Work abandoned. Almost total loss of investment. Cost increases 4. Tanga/Horohoro & Marangu 9,099,438 Gravel road completed excluding bridges. Tarakea (118km) Sub-total 32,050,148 6. Rehab. - Tanzam 2 3,999,922 Substantially completed under Cr.1688: Six 7. Rehab. - Tanzam 4 5,368,290 Highway Rehabilitation Project; but payment; 8. Rehab. - Tanzam 5 96,319 represent payments made under IRP i. Sub-total 9,464,531 9. Kayaka Bridges and 7,741,022 Implementation experienced many failures of approaches structures, approaches, and temporary bridge. Substantial additional works included after commencement. 10. Emergency Works for Dar es 35,343,683 The program had seven contract packages; but Salaam Roads only six packages were implemented. Poor surveys and designs and frequent changes in scope of works resulted in poor quality and cost increases. Some of the roads disintegrated. Total 84,599,384 14. On the institutional front, modest progress has been made towards achieving some of the institutional development objectives. A modest private construction industry has been created. Road maintenance administration has been decentralized in 20 regions. The Road Fund established under the project now can potentially provide some 70% of the required road maintenance funding. Road maintenance expenditure made from the Road Fund has increased from US$7.24 million in 1991/92 to US$22.48 million in 1998/99. The National Road Agency expected to be established in July 2000, and fully operational by June 2002. Significant number of high level manpower has been trained at home and abroad. With respect to liberalization, the Plant and Equipment Hire Company is now in the process of privatization. Nevertheless, it is generally agreed by both MOW and donors, that institutional issues, particularly contract administration and project management are still major Tanzania: Integrated Roads Project Page 5 Implementation Completion Report Part 1: Project Implementation Assessment problems in efficiently managing the road network. Overall, the project achievement is assessed as unsatisfactory. 15. At completion, the total fund expended on IRP I was estimated at US$868.0 million including GOT contribution estimated at US$60.0 million. US$166.7 million equivalent (SDR1 17.2 million) of IDA fund was disbursed and US$ 12.17 million of the original estimates was cancelled along with US$ 19.0 million equivalent from exchange rate savings. However, the costs of institutional support were more than double the appraisal estimates (para.). This applied for both IDA and for the other donors. Cost escalation for civil works ranged from 40% to over 125%. Delays in procurement totaling 30 to 36 months have been experienced, although major improvement has been observed lately. I. Institutional Reforms. 16. Reorganization. Decentralized decision making to the regions for planning and implementation of road programs were introduced and staff was assigned to all 20 regions. Following the Mramba Commission on restructuring of the Tanzanian Government, all transport modes in different ministries were brought under one oversight agency, the Ministry of Works, Communications and Transport (MWCT). REOs reverted-to MWCT from the Regional Authorities in July in 1990, incorporating the MOW trunk roads maintenance organization in the 20 regions. Subsequently, following three years of discussions to create a more streamlined organization for overall management of the transport sectors, the ministry was further split into MOW and MCT. MOW, Department of Roads (which was split from Buildings in November 1991) was to provide better focus on road infrastructure needs. In line with the Parastatal Sector Reform Commission, one objective of the later reorganization was directed at preparing for private partnership or ownership of the transport functions (road, air, and maritime transport) and creation of public work parastatal for road equipment (PEHOL). The establishment of an agency specifically related to road construction, TANROADS, remained an important agenda of reform supported by donors throughout the project life, but the government was reluctant to pursue this in the initial years of the project. It was only in the last two years that the GOT changed its stance and today TANROADS is being established. 17 Training. Significant manpower has been trained under IRP I. In MOW, under IDA funding alone, a total of 63 staff obtained Master of Science Degrees: 54 in engineering; 3 in construction management; 4 in human resources and 2 in transport economics. However, of the 23 foreign educated professionals, only 11 are currently with the ministry. Out of the remaining 40 who graduated from the University of Dar es Salaam, all are with the ministry except the two who died. Regarding the short-term trainees, 14 out of 32 of the foreign trained, and 336 of 379 locally trained are still with the ministry. Also, in the National Construction Council, a total of 15 staff had received advanced training and 12 of those are currently with NCC. Similarly, other donors have provided training. While this is a significant capacity and it should have translated into effective performance, the consensus of donors and the ministry itself is that the ministry has yet to significantly overcome its capacity problems. One reason, in the words of one of the staff who received post-graduate degree under IRP I financing, "with wages which hardly cover two weeks living expense, you are expected to devote yourself to your work for a full month". Although a staggering US$105 million3 (from all donors) was spent on the capacity building effort over a nine year-period, the absence of an adequate incentive structure undermined these efforts. 18. Contract Management. MOF undertook a study and implementation of a revised procurement and supplies management after much delay but its findings and recommendations were not made effective and had little effect on the implementation of IRP I. However, improvements are 3 A total of us $105 million was expended by all donors on capacity building as estimated by Carl Bro International a/s, Comprehensive Review of the IRP, Third Interim Report, Revised June 1997. Tanzania: Integrated Roads Project Page 6 Implementation Completion Report Part 1: Project Implementation Assessment evident since 1998. Currently, procurement time on civil works have tended to be within the tender validity period, while processing consultancy service contracts still exceed the tender validity period, partly due to two stage evaluation and each stage undergoing internal clearances before obtaining "no objection" from IDA. 19. Technical Capacity for Road Maintenance. Road Maintenance Management System was introduced. Socio-economic criteria were used for selecting priority road improvements. Labor- based contract training was undertaken; and a management information system was introduced. 20. Road Fund. The road fund was established in July 1992. The Sub-Sahara Africa Road Maintenance Initiative (RMI) and the donor community supported the program. The revenue is derived from fuel toll levy. In principle, significantly more resources should be available to pay for road maintenance with road users shouldering an increasing share of the cost of maintenance. Currently, 70% of the total collected revenue from fuel levy is allocated to road maintenance. The amount available in the future depends on the performance of the economy and on the levy rate applied. 21. In the first three years of its establishment, the road fund was covering significant share of the resource requirement for the maintainable road network. Over time, delays in transfer of road funds to the Ministry of Works became frequent. This affected the effective execution of maintenance activities. There was also misapplication of the road fund. In 1995/96, there was a crisis with the road fund. Following short falls in the government revenue, GOT diverted the road fund to the general account. The government saw the issue as a balancing act between important national priorities due to tight budget to meet resource needs for counterpart funding; rising debt payments, both external and internal; food deficit due to drought etc. Among donors, the 1995/96 'road fund crisis" rekindled the donors' concern that maintenance was not being given adequate priority. 22. Audit reports on the road funds were highly qualified. For example, the audit reports of the 1994/95, 1995/96, and 1996/97 showed that the fund was used for ineligible expenditure which included: terminal benefits, night out allowances to casual laborers, subsistence allowances, severance allowances and transportation of personal effects. Contractors with poor performance continue to be awarded contracts paid from road fund. These led several donors to question the transparency and accountability of the road fund. In the last two years. In response the GOT has undertaken confidence-building measures, including establishing Road Fund Board, and appointing a chief executive for TANROADS scheduled to commence work in July 2000. II. Commercialization. 23. Construction Industry. In line with its commitment, GOT adopted in 1992 the National Construction Industry Development Strategy. This led to the establishment of a private sector led construction industry. Local contractors and consultants received training. By the end of 1996, the number of private civil works contractors had significantly increased from about 43 in 1989 to 610, of which some 200 were in road sector. Today, there are more than 50 contractors with capabilities to undertake basic unpaved road rehabilitation and periodic maintenance works. Maintenance works are now carried primarily using local contractors instead of force account. In the 1995/96 "road fund crisis" the contractors played active role by lobbying for the timeiy disbursement of the road fund. Yet despite significant increase in the 1990s in the number of qualified domestic contractors, their share of the market has remained low, around 10% of total value of contracts. This is the major concern to the nascent private contracting industry in Tanzania. 24. Plan and Equipment Hire Co. Ltd (PEHCOL). Under the credit GOT was committed to manage all its road equipment along commercial lines, with users paying full hire rates. However, because of lack of reliability of the PEHCOL's equipment, commercialization objective was not as successful in the regions where PEHCOL had workshops as elsewhere. Much effort and resources were expended to bring the equipment in good service condition. A consultant was hired to advise on rehabilitation strategy. A total of US$ 11.45 million was utilized for the purpose from the IDA Credit of Tanzania: Integrated Roads Project Page 7 Implementation Completion Report Part 1: Project Implementation Assessment which about US$5.0 million directly on repairs and rehabilitation and US$ 6.0 million indirectly in the forms of supervision vehicles, studies, technical assistance. 15 plants and 7 vehicles were rehabilitated; 35 plants and 12 vehicles had overhaul of major components; and 19 plants and 47 vehicles received upgrades. But the impact of the above expenditure on improved equipment availability was marginal as most of the equipment in PEHCOL fleet was old. In retrospect, the economic merit of rehabilitation of the old equipment is questionable and there is need to look for new approaches to establish equipment-leasing companies in remote rural areas. GOT has now decided to sell 51 % to 75% shares of PEHCOL to private investors. Bids were opened in May 1999. Valuation of bids is ongoing under the Presidential Parastatal Sector Perform Commission. 25. National Transport Corporation (NTC). Following restructuring exercises, measures were taken to bring about reduction of fleet sizes and manning levels of the companies with a view to improve efficiency, reduction in costs and therefore improved profitability. Two of the RETCOs showed profit in 1997/98. The previous years, RETCOs showed losses due failure to adjust to shortage of consolidated cargoes arising from the liberalization of agricultural crop marketing. Starting 22nd of August 1997, NTC and the associated companies became a Specified Public Corporations and are earmarked for divestiture during FY 1999/2000. Government has decided to sell the RETCOs to the workers, the public and institutions in the respective regions. As regard to Shirika la Usafari Dar es Salaam Ltd. (UDA) it has been decided that 75% of the shares will be sold to investors in 2000. 26. Tanzania Air Corporation (ATC). Management and administration study funded under the Credit had some impact on the profitability of TAC. Of the seven items TAC planned to procure under the project five were implemented. Two items, the airline revenue accounting package, and purchase of 18 reservation terminals totaling US$132,302 will be financed under IRP II. Ill. Physical 27. Overview. Overall, achievement of the IDA civil works component is now assessed as partial. Assessment of project progress was initially more positive. In mid-1993, based on initial progress, but not based on actual physical achievements, the project was considered a success and therefore a follow-on project, IRP II, was appraised. The basis for the partial rating is for the physical achievements is already highlighted in paras.12-13. However, the gravel roads implementation merits further details as it eventually led to major procurement problems. 28. Gravel Roads. All the gravel roads constructed between late 1992 and early 1994 under IDA financing were substantially changed from the original scope of works from spot improvement, regular periodic maintenance-rehabilitation to works to full-scale reconstruction. Moreover, this was done without full assessment of the financial and budgetary impact of the decisions being made and without an IDA "no objection". While the designs were adequate for the original scope of works, they were not adequate for the new scope of works. Moreover, no detailed designs were made available to the contractors or given to the Bank for prior review. The design changes were made on site through variation orders issued by supervision consultants. For example, in the cases of Lusahunga-Usagara (266 km) and Tunduma-Sumbawanga (226 km), construction were undertaken without proper design, drainage and widening of roads from 6.0 m to 7.5 m were undertaken. In the cases of Babati area roads (310 km), there was a widening of roads from 6.5 m to 9.5 and finally to 10.2m and reducing the road length to 107 km by the omission of sections (i) Babati-Bereku (35 km) and (ii) Babati-Singida (168 km); and introduction of a major realignment at Sekenke escarpment which involved major earth works and drainage structures. In the case of Tanga-Horohoro (68 km) and Marangu -Tarakea (52 km) roads, two projects about 500 km apart were lumped together in one contract. Partially as a result of these changes many sections of these roads failed during the first major rains. Similar conceptual and implementation mistakes occurred with the emergency rehabilitation of Dar es Salaam Roads. 29. By May 1994, the poor quality of works and high unit cost of ongoing projects began challenging the initial assessment. In the case of gravel roads financed under IDA, substantial Tanzania: Integrated Roads Project Page 8 Implementation Completion Report Part 1: Project Implementation Assessment changes in scope of work without appropriate engineering design and the Bank's approval led to significant quality of works failures and major cost overrun over the contracted amounts, making impossible achieving the physical targets set at appraisal. Serious attempts were made to salvage the above components, but the operating environment proved intractable. In March 1995, IDA requested the government to appoint an independent consultant to look into the causes of failure of the rehabilitated gravel roads and to suggest actions to be taken to rectify the situation. In July 1997 when the consultant report came out, IDA was to proceed with preparatory process for a major restructuring of the project but progress halted when the entire senior management of the ministry was criticized in the Warioba Commission Report on corrupt practices. According to the Report, '...Officers of the Ministry of Works receive bribes in order to give favor in awarding tenders; to accept upward variation of contracts; to conceal the weakness of the contracts; and in approving payments. Moreover bribes are offered at roadblocks in order to let undeserving vehicles through." Further, the previous consultants' and contractors' claims for the gravel roads remained outstanding. It was only in March 1998, that the reorganization of the ministry took place and in March 1999, the claims of the contractors and consultants were settled. Moreover, there was not adequate funds under the credit to fully finance the required works. Therefore. it was decided to close the project after one-year extension from the original closing date of June 1998. 30. The major finding of an independent consultants carrying out the project review was that the government supervision consultants did not provide MOW adequate waming signals of emerging problems. The consultants' review also indicated that the gravel road contracts have had procurement and project management problems starting from the pre-qualification of consultants, preparation of inadequate engineering designs to the contracting and construction supervision monitoring, actually since commencement of the Project in 1991. Poor direction and weak project management by GOT influenced the performance of the consultants. The production of the tender documents including the field survey took an abnormally long time (about two years to get to the tender stage). Pre-qualification of contractors was advertised between 31 January and 5th February 1988, after which, out of 32 contractors who applied, 27 were pre-qualified. This list was then used for actual biding for the gravel road contracts more than two years later. 31. Bridges. The SAR budgeted US$8.0 million for some 20 trunk road bridges and ten ferry crossings. But only one bridge, Kyaka Bridge and its associated works in Kagera district was completed at cost of nearly US$7.7 million exhausting the available resources for bridges and ferries. Implementation was followed by many failures of structures, approaches, temporary approaches, and temporary bridges. 32. Emergency Works. The IDA component of the project also financed road maintenance and a portion of outstanding balances for emergency works on Tunduma-Sumbawanga and other gravel roads. 33. Regional (District and Rural) Roads. Several donors financed rural roads under IRP I: including the EEC (200 km), UNDP (52 km) and USAID (1697.0 km). USAID under its Agricultural Assistance Program (ATAP No. 621-0166) was the major donor. In January 1996, USAID issued impact assessment report on its program. The report covered a review of the institutional, financial, road industry and local people-level impacts and the project sustainability. The report concluded that ATAP was making reasonable progress. It assessed the outcome as likely sustainable, provided the program continues the support of the GOT. 34. Studies. Various studies have been carried out in the areas of construction sector industry (Table 8). The extension and update of the Zanzibar's road network study from 1991, successfull completed on time, is one such project that is likely to attract financing. Tanzania: Integrated Roads Project Page 9 Implementation Completion Report Part 1: Project Implementation Assessment IV. Macro-economic Impact of the Program 35. Significant transport cost reduction has been achieved on roads rehabilitated to good/fair standard (para.27). However, because the targets for roads in good condition was not realized under the Credit, the outcome compared to the high expectation at appraisal has not materialized. C. Major Factors Affecting Project Implementation 36. Overview. The factors that were partly outside the government control and which affected the implementation of the project included: difficult environment for implementation, inadequate design, and problems in donor coordination and poor performance of consultants and contractors. The factors within the government's control were lack of good governance including corrupt practices, failure to apply lessons learned from preceding project implementation, substantive changes in the scope of works without proper documentation, lack of proactive response, frequent reorganization of the implementing agencies, inadequate counterpart funding, and poor staff incentives. Factors within the control of the implementing agencies included procurement problems, deficient contract administration, and poor project and financial management control. 37. Factors Not Generally Subject to Government Control. * Lack of realism in the project design. In principle, project design should prioritize investments and ensure an appropriate balance between the development of the productive capacity (road network) and the institutional and policy capacity to oversee the network. In this project, institutional aspects were stated as primary objective (evidence by the order of presentation of the two objectives in the project), but there was never a clear consensus on this between the government and donors. * Effective Donor Coordination remained an issue throughout, although a senior technical advisor was appointed as part of the project implementation arrangements. Information on the activities of the donors and resources were difficult to come by and to achieve coordination of priorities. There were no adequate documentation to help find out what each donor is doing and how many resources each donor was spending. Lack of coordination among donors resulted in excess local contracting capacity creation. Also, not all donors were active in the implementation issues. Finally, GOT received a number of conflicting signals, for example, on road fund, road agency, reorganization of the transport sector, on the speed at which these changes were to be implemented and on the degree of achievement of the project objectives. * The government did not always get the best advice from its advisor and consultants on status of project management as evidenced in the poor quality civil works, cost over runs, delayed completion of subprojects and unfavorable terms of contracts. 38. Factors Generally Subject to Government Control. * The prevailing implementation environment was difficult. As noted in the Warioba Commission Report (Dec. 1996), the governance system prevailing in the ministry was not conducive to timely completion of project. Audited accounts also showed serious shortfalls. Macroeconomic performance was below expectations, and country performance ratings of inflation, fiscal deficit, savings and expenditure management were poor. OED reviews pointed to difficulties in controlling the budgetary pressures that were fostering inflation. * The lessons of experience of the preceding Highway Rehabilitation Projects appear to have little impact. Poorly documented engineering design were one of the main causes of delays and cost escalations under the Sixth Highway Rehabilitation Project and remained so in IRP I. Tanzania: Integrated Roads Project Page 10 Implementation Completion Report Part I: Project Implementation Assessment * Counterpart financing was a problem. The prevailing macro-economic conditions made it difficult for the government to meet its commitment to make available the proceeds from road funds on time and in the amount required for road maintenance. Because of the development budget funding problem, MOW used the road fund revenues to fund emergency expenditures. * There were several implementation issues for which adequate and timely attention on the part of the GOT would have radically changed the situation on the ground and the perception of donors towards the government's performance. Lagged responses on the part of the government raised concern as to the government's commitment. Some of these included: decision to change the scope of works from rehabilitation to reconstruction without proper engineering design; delays in commercialization of PEHCOL and delayed establishment of road agencies; prolonged delays on taking action against corruption, use of dedicated road fund for the purpose not intended, etc. The governments delayed responses to the donor community's queries on the 1995/96-road fund allocation and road agency issue led to a request by the donors to meet with the President on these issues. * Frequent reorganization of the implementing ministry in the midst of implementing such a large project had also adverse impact on project implementation. The split of MWCT into two separate ministries diverted senior management attention away from implementation of IRP projects towards reorganization. The reorganization also resulted in lack of coordination between the two ministries dealing with transport and was for a time a source of delays until functions were sorted out. - The weak incentive system in the implementing agency did affect staff proactive performance, contributing to delay completion of the project, leading to substantial changes in scope of work without supporting technical preparation. The result was of significant consequence to project implementation - cost escalation, including changes in-contract prices of over 100% of the original amount. * The weak contracting industry also contributed to the poor quality of works and cost escalation. 39. Factors Generally Subject to Implementing Agency Control. * The project faced several problems with timely decision making processes, delays in execution, cost overruns, implementation problems, technical/financial problems, technical and financial monitoring and quality of executed works. The selection of contractors, their financial capabilities and the contractors' capabilities to import equipment created also problems for the project. Variation orders in magnitude well above than 15% of the project contract without the Bank's approvals were allowed contrary to Appendix I paragraph 3 of the Guidelines for procurement under IDA Credit. Throughout implementation, the coordinating office was not adequately equipped or staffed to effectively handle these issues for such complex project. Generally, it was less proactive and left issues unresolved for too long. * Procurement and contract administration were focal points of IRP I problems through out the project life. In particular, the area of procurement and negotiation of contracts, the implementing agency could have contributed much more than it did. Either due to omission or commission, procurement problems, and deficient contract management contributed to cost escalations and poor quality. Moreover, the contracts provided generous price escalation payments. For example, foreign currency exchanges were fixed at unrealistic rates resulting on variation on the dollar to almost 20% per annum whereas in real terms it should have been only 4% at most on the international market. Moreover, the foreign currency portion should not have been escalated for the first 12-months of the contract. In addition, the Tanzanian portion should not have been subject to price escalation before the first 12 months of the contract expire, and thereafter price escalation should have reflected only the inflation prevalent in the country in the various inputs. Overall project implementation delays were between 30 to 36 months. Procurement delays Tanzania: Integrated Roads Project Page 11 Implementation Completion Report Part l: Project Implementation Assessment averaged 189 weeks from tender to signing of contracts; poor contract administration contributed to price escalation in majority of cases exceeding 100% of the contract price. Inadequate contractors capacity contributed to poor quality of works resulting on failing road structures and road surface, particularly for gravel roads. D. PROJECT SUSTAINABILITY 40. Project Sustainability. Overall, the sustainability of the project is assessed as uncertain. It appears that much longer time than originally planned is needed to assure sustainability. Sustainability of the progresses made with respect to institutional objective depends on the prevailing environment, government commitment to maintenance-first policy, proactive leadership, the incentive system to skilled manpower and on follow-up measures to consolidate the progress achieved to date - road fund, road agency, etc. The sustainability of the commercialized activities under the liberalization regime depends on the entrepreneurial ability of the new contractors and their financial capacity. The sustainability of the maintenance system introduced depends on the performance of the economy to generate road fund revenue and eradication of corrupt practices. E. Bank Performance 41. Identification and Preparation IDA's performance during identification and preparation phases is assessed as satisfactory. IDA staff rightly identified that transport was a major constraint facing the Tanzanian economic recovery in its transition to market-oriented economy. During preparation IDA staff provided critical assistance to GOT in coordinating donor assistance and packaging the program. 42. Appraisal. Appraisal did address many issues and was cognizant of the complexity of the project design. In retrospect, however, there were some shortcomings in its assessment: defining the alternative design of the project (e.g. considering a series of several projects based on an agreed program suggested at the time); the inadequate incentive regime as well as the readiness of the implementing agencies to perform basic tasks. Appraisal was also weak in assessing the risks on the physical objectives due to multiplicity of development objectives, which required major institutional structural changes. Moreover, given that the rationale for undertaking the project was to remove the transport constraints on the ongoing economic recovery program, the primary development objective of the project should have been the physical objective (83% of the project cost), and institutional capacity should have focussed more, and first on the basics of procurement, contract administration and project management with the scope of institutional reforms more phased. Certainly, the perception at appraisal that the primary risk of the project would be from "slow liberalization!" is a reflection of a failure to assess the real reasons of the project of this size. Second, the risks due to lack of incentives to staff was identified at appraisal as a risk, but an adequate sustainable solution was not found in the context of the civil service at the time. Third, since it is known from experience that earlier IDA financed highway sector project had experienced basic implementation problems in performing the basics tasks of procurement, focusing on contract administration and project management at appraisal would have led to a more focussed project. In summary, appraisal is assessed as deficient. Supervision 43. As noted in the earlier sections of this ICR, the conceptual design of the program and its large- scale investment was aimed at meeting the enormous requirements of the country for a well- functioning road infrastructure at a time when the economy was recovering. The deteriorated road network posed serious constraints to the movement of both people and goods, and particularly the flow of agricultural inputs to farms and outputs to markets, and the mobility of people to access social services. The donor community considered that a large program encompassing both capital Tanzania: Integrated Roads Project Page 12 Implementation Completion Report Part l: Project Implementation Assessment construction and basic capacity building was needed to elicit a supply response to the macroeconomic reforms, which the government was undertaking. 44. Against this background, the donor community agreed to finance a complex and high-risk program totaling US$871 million. There was great optimism that the program would work and this sense of optimism was reinforced by the apparent eagerness of the government to reform its public administration. However, the outcome of the program execution shows that, given the scale of the appraised program and its complexity combined with the weak institutional structure, the donor community's optimism was misplaced. 45. The project achieved initial success: the launching ceremonies, the signature of the first large contracts and the completion of one or two links during the first two years, the implementation of the of the reforms in decentralization of road maintenance, maintenance planning, improved reporting, the quality of presentation at mid-term review. However, this early success later proved to be a liability, since it obscured the ability to detect and respond to implementation problems which soon arose. As the number of contracts increased, the existing infrastructure to implement the project did not grow in tandem and as a result enormous delays in procurement processing occurred leading to huge increases in program costs. 46. Although the design of the project anticipated the stationing in Tanzania an experienced highway engineer from the Bank to assist the government in coordination of the project, eventually an ex-Bank Principal Transport Engineer (PTE) was located in the Bank's Resident Office answerable to the Permanent secretary of MOW (who was responsible for implementing the Project). The arrangement appeared to be working. However, as the works progressed, conflicting signals appeared regarding the role of the engineer, causing confusion to the client, Bank management, contractors and consultants. The optimistic views of the engineer on the program performance and his communication with other players actually contradicted the findings of the headquarters-based task team and its early warnings that the project's institutional structure could not manage the planned activities, that the planned milestones could not be achieved within available resources and that the project was moving towards a crisis. The conflicts implied in the engineer dual roles in acting as both an adviser to the government and as a supervisor by the client during the first four years of the program clearly delayed the emergence of a consensus among the task team, Bank management and donors on required measures to turn around the performance of the program. 47. The influx of funds and the complexity of the project combined with the inability of the implementing organization to increase its capacity at a rate commensurate with the growing volume of works, and the overall poor governance environment in the country, led to major mismanagement of the program and eventually to corruption. By early 1994, the Bank supervision reports began to clearly state the problems, but Bank management influenced by the resident engineer, and the optimistic donor perceptions did not immediately grasp the seriousness of the situation. However, by the beginning of 1995, Bank management decided to strengthen the headquarters supervision mission team by including an experienced senior highway engineer and the magnitude of the problems facing the project were clearly identified. 48. In retrospect, questions could be raised such as: (i) why the early concerns raised during initial supervision missions were not responded to more quickly; (ii) why questions were not raised earlier on the growing disconnect after 1992 between the resident engineer and the supervision missions; and (ii) why an independent engineer was not added to the supervision team until after substantial commitments were locked into. Clearly the initial progress led to a misplaced level of optimism but more important the decision to place a senior engineer into the field as both an advisor and implementor led to a conflict which contributed to substantial implementation difficulties later on. 49. By 1995 the government had lost control of the program, arguably a result of mismanagement. The headquarters task team downgraded the rating of the project to unsatisfactory, stopped giving no objections to new contracts, focused on ongoing contracts and on ascertaining the precise physical and financial status of the project with a view to restructuring it. Bank management, now Tanzania: Integrated Roads Project Page 13 Implementation Completion Report Part l: Project Implementation Assessment convinced about the deficiencies in implementation of the project, aggressively supported the task team and intensively dialogued with the government on the required project management and institutional changes. 50. In 1996, the government concern about mismanagement in all facets of public administration led to a report on the State of Corruption in the Country (Warioba Report) in which the Ministry of Works was highly criticized. The report stated that ".Officers of the Ministry of Works receive bribes in order to give favor in awarding tenders, to accept upward variation of contracts; to conceal the weaknesses of contractors; and in approving payments. Moreover bribes are offered at road blocks in order to let vehicles through." The report recommended a total reorganization of the Ministry and removal of the management team, the same team which had been earlier seen as "champions" of the program by the Bank and the donors. More than two years after the Warioba Report, in February 1998, the government eventually replaced the top managers and engineers who had been implicated by the report. The Ministry was re-organized and five months later, the Bank was able to partially close this project and to restructure the ongoing Second Integrated Roads Project. In June 1999 the government passed legislation for establishment of the Road Act and Road Fund Board and for establishment of TANROADS. 51. With regard to basic capacity building, which was to take place in parallel with the works programs, the results have been poor because the conditions for effective capacity building did not exist. Although large amount of resources was spent on this effort over a nine year-period (para.17), the absence of an adequate incentive structure undermined the efforts. The Ministry's highly qualified professionals received monthly salaries barely adequate to meet living costs for two weeks. At the same time they had to work side by side with counterparts, provided by donors, contractors and consultant's staff, who eamed 100 times their own salaries. This arguably led to an environment that undermined the project implementation. 52. The arrangements and safeguard measures planned in the project did not adequately recognize the risks given the large scale of the project, its complexity and the weak institutional structure. The unrealistic optimism that the government's apparent commitment to reforming public sector administration would be translated, through the capacity building component, into real capacity needed for project implementation proved to have been a miscalculation. The failure to adequately take into account the lessons learned from the Sixth Highway Project, a smaller scale operation that nevertheless showed similar problems, proved fatal in a much larger and ambitious project. Status of Civil Works of IDA financed component, ref. Paragraph 13 above in the text, shows the cost increases of the IDA financed road works and the magnitude of the deviations from original contract values. 53. Thus, it is in the context that both appraisal and supervision are rated at all level of management as marginally unsatisfactory - a set of good ideas undermined by an unduly ambitious and optimistic project design; the early successes following initial contract signatures and improvements in road conditions making it difficult to identify and gain acceptance by subsequent delays and problems; the controversial role of the Principal Transport Engineer in advising both the government and the Bank management and staff; and poor governance conditions in the country all had a role in the project's eventual failure. Notwithstanding the substantial efforts of the headquarters based task team, in identifying the problems during the supervision as the project's midlife and their extensive efforts to get things on track throughout the rest of the project's life, the conditions in-country and in the donor community and the role of the engineer undermined the effectiveness of the supervision efforts during the critical years when the bulk of the investments were committed. F. BORROWER PERFORMANCE 54. Preparation. Overall Borrowers preparation is assessed as satisfactory. The government's initiative in its Transport Sector Policy Paper and its Transport Recovery Program and Tanzania: Integrated Roads Project Page 14 Implementation Completion Report Part l: Project Implementation Assessment its ability to bring some 16 donors to agree in support of its program over a period of three years, was a major undertaking. It showed leadership and made good on the reservoir of good will the government had among the donor community at the time. Coming to closure was a fit of accomplishment. On the other hand GOT had some shortcomings. It had not made adequate preparation to correct the weaknesses revealed in the course of implementation of a series of Highway Projects IDA financed earlier. It had not piloted or pre-tested the process of procurement and contract management process to be used in administering the project. 55. Implementation. GOT has overestimated its implementation capacity. The government was not able to execute its ambitious program on schedule and within budget. Audit reports of project accounts, as the scale of implementation increased, were highly qualified. In particular, GOT and its implementing agencies failed to make good use of the resources at their deposal as in the case of the gravel roads. Where the govemment has ultimately made good on its commitments, the responses were not often timely and sometimes had required the prodding of the donor community as in the case of the Road Fund, Road Agency. In the area of procurement, project management and contract administration, a decade after the launching of IRP I, and after continuous reminder of the problems in these areas, and substantial expenditure of resources for manpower training, there is no evidence that the implementing agency is significantly better than it was at the start of the project. GOT management of its consultants was not demanding. It must also be stated that the consultants and the advisor to the govemment did not provide always quality professional services. These professionals could have contributed to better quality of works but failed to do so as evidenced from their implementation performance. Most disappointing was the fact that the project advisor failed to steer the project implementation in the right course. 56. In particular, there were problems related to the use of the Special Account. An initial deposit of USD12.0 million was made to the Special account (SA) in March 1991. By January 1996, the balance in the SA had dropped to about US$5.6 m. CODAP had made payments of about US$3.2 million on account of seven addenda for civil work and consultant services. As no formal "no objections" were given to the amendments covering such additional works and services, CODAP failed to follow IDA procurement procedures for supplementary contract increases and made payments without following IDA procurement procedures for supplementary contract increases. Until an independent consultant's report on the addenda was published, IDA limited the SA to the available USD2.4 million, suspended replenishment starting July 1996 and the minimum size application correspondingly reduced from USD1.2 million to USD150, 000. Outstanding invoices amounting USD5.6 million were directly paid from project accounts. G. Assessment of Outcome. 57. Project outcome. Overall, the outcome of the IDA financed component is assessed as unsatisfactory. However, as a result of the project, there is today a more organized sector program. The government has learned valuable lessons from its implementation experience. A private sector led road construction sector industry has emerged. Road maintenance is now carried by private contractors, who have largely come into existence with the support of the IRP I. Despite the temporary relapse in the administration of the road fund in 1995/96, road fund now contributes a significant share of the cost of maintenance. The Road Fund Board supported by the Road Fund Act administers the road fund. The TANROADS is finally going to be fully operating by July 2003. However, the impact of transport cost reduction on the macroeconomic situation was not as high as expected at the start of this ambitious program. Also, the basics of project management and contract administration have yet to be mastered. H. Future Operations 58. Key Elements of Future Planned Operation. To lay the foundation for excellence in institution building, there is need to assure that the modest capacity achieved to date under the Tanzania: Integrated Roads Project Page 15 Implementation Completion Report Part l: Project Implementation Assessment project, especiaUly the trained manpower and the creation of a road agency, is sustained. Assuring adequate resources for road maintenance will remain essentially an ongoing issue. Given past performance of the economy, efficient and effective use of the available road fund will be another critical area of focus. 1. Key Lessons Learned and Future Actions. 59. Key Lessons Learned and Future Actions. This Integrated Roads Project has been the largest and most ambitious project in the sector. As such it has been the subject of multiple reviews including a recent Bank Quality Assurance Group review. This ICR identifies a number of key lessons for future project design and implementation in Tanzania. * Project Design. While the concept of sector investment project on which IRP I is based appears workable, its application to a specific country requires making tradeoffs between major development objectives based on detailed analysis of major risks in achieving those objectives. In particular, in the civil works, the absence of detailed engineering for all major roads immediately prior to start of construction, made variation orders almost inevitable, leading to delays and cost increases. In institutional capacity building too, the many demands for reforms, taxed the capacity of the government to deliver on budget and on schedule. Therefore, in projects of IRP I type, it is important to introduce "checks and balances" with early warning signals to be able to adapt the program when required. * Corrupt practices. The poor implementation performance of IRP I testifies that the potential for corrupt practices can significantly impact project implementation performance. In this case, roads that would have been constructed under the project to good standard remained uncompleted partly because of corrupt practices and the absence of systems and procedures that could check against their occurrence. The Government should institute measures to safeguard against such practices. Physical progress should be verified against design specifications. Stringent measures should be taken under situation where audit reports are constantly delayed and qualified in order to fight potential corrupt practices from blossoming. Learning from Past Mistakes. The lessons of experience of past project implementation were to safeguard against future mistakes both for IDA and the borrower. As a matter of fact, major flaws experienced in the Sixth Highway Project Credit were also experienced under IRP 1. For example, appropriate technical documentation and provision of adequate resources should be fully completed before commencement of works. In short, more attention needs to be paid to past lessons of experience during project design and implementation. * Composition of Project Team. Supervision team should have professional mix with key persons being sufficiently experienced in the major fields of a project activities such as engineering, institutional reforms, etc. In addition, there should not be frequent changes of supervision management and teams, in order to ensure continuity and consistency of efforts in achieving quality and quantity of the planned targets. * Technical Documentation. Technical documentation necessary for implementation of civil works should be updated before actual commencement of construction works. * Donor Coordination. The spirit of cooperation of the donor community in support of the Integrated Roads Project I had no parallel. It was the first time so many donors have committed themselves to such a large common program. Unfortunately, in IRP 1, it has not been easy to maintain the interests of all donors' cooperation during implementing phase as each donor focus on execution of its own mini program under the parallel financing arrangement. In future, in large investment supported by several donors, a professional coordination managed by the government should be established, with agreed terms of references. Tanzania: Integrated Roads Project Page 16 Implementation Completion Report Part 1: Project Implementation Assessment * Technical and Financial Audits. The Government should among other things, carry performance technical and financial audits of the works carried out. Such audits should, besides frequently revisiting the overall status of implementation, also include verification of the physical and financial targets. * Initial Successes in Long-term Program. Usually during the initial phases of project cycle of large programs, there is high optimism of the team involved and there is a tendency to underestimate the operation environment of the specific country for which the project is designed, even when there are potentially implementation problems. Initial successes usually mask deficiencies related to preparation, selection of contracts and judgements of capacities. It is therefore important that project implementor should not be taken in by an initial euphoria and ensure that measurable output targets are met. The project should have well defined qualitative and quantitative indicators, which should be adequately designed so that any deviation from initial targets can be detected and corrected in real time. Tanzania: Integrated Roads Project Page 17 Implementation Completion Report Part II: Statistical Tables TANZANIA INTEGRATED ROADS PROJECT (IDA COMPONENT) (CREDIT 2149-TA) PART II: STATISTICAL TABLES TABLE 1: SUMMARY OF ASSESSMENTS A. Achievement of Objectives Substantial Partial Negligible Not Applicable Macroeconomic policies E El x Sector policies E X E E Financial objectives D X a E Institutional development ° x El Physical objectives X E E Poverty reduction E X E E Gender issues Cl 0 E X Other social objectives (Donor E X a E coordination) Environmental objectives El X a Public sector management O x E E Private sector development O X El B. Project Sustainability Likely Unlikely Uncertain El El X C. Bank Performance Highly Satisfactory Satisfactory Deficient Identification El XE Preparation assistance E] X Appraisal E X Supervision4 E E X D. Borrower Performance Highly Satisfactory Satisfactory Deficient Preparation El x a Implementation El El X Covenant compliance l E x Operation (if applicable) E El E. Assessment of Outcome* Highly Satisfactory Unsatisfactory Highly Satisfactory Unsatisfactory n El X O 4 marginally Tanzania: Integrated Roads Project Page 18 Implementation Completion Report Part Il: Statistical Tables TABLE 2: RELATED BANK LOANSICREDITS Credit Title Purpose Year of Status approval Preceding Operations: 1. First Highway Project (Cr. Construction of six road sections with 1964 Completed. Project 48-TA/Cr. 115-TA, US$17.0 detailed engineering work closed in July 1973 million) 2. Second Highway Project Construction of 499 kms of Tanzania 1969 Completed. Project (Ln. 586-TA/Cr. 142-TA, Highway closed in December Second Highway Project, 1978 US$22.5 million) 3. Third Highway Project Paving of the road between Mtwara and 1971 Completed. Project (Cr.265-TAILn.586-TA, US$6.5 Massasi and pre-investment studies closed in December million) 1978 4. Fourth Highway First phase of establishing a trunk road 1977 Completed. Project Maintenance Project (Cr. 507- maintenance studies. closed in December TA, US$10.2 million) 1985 5. Trucking industry Strengthen the operating capability, 1977 Completed. Project Rehabilitation and management and management closed in December Improvement Project (Cr. information systems of selected 1998 743-TA, US$15.0 million) companies through procurement and rehabilitation of trucks 6. Fifth Highway Project (Cr. Second phase of establishing a trunk Completed. Project 876-TA, US20.5 million) road maintenance organization closed in December 1989 7. Sixth Highway Reduce transportation costs by 1986 Completed. Project Rehabilitation Project rehabilitating most important sections of closed in June 1994 (Cr. 1668-TA, US$50.0 million) the highway network; improve the system of road maintenance works by increasing the contractors; assist and expand capacity and efficiency of the trucking industry; and increase the availability of trained engineers in Tanzania; Following Operations 1. Integrated Road Project II Strengthen the capacity of the MCW to 1994 Ongoing (Cr. 2598-TA, US$170.2 manage road maintenance program million) and to execute road rehabilitation and Project restructured in upgrading works. August 1998. Reallocation in January El Nino emergency rehabilitation 2000 with project program of trunk, feeder roads and completion date major bridges. extended until June 2003. Emergency resurfacing of Kilimanjaro airport Design of Singida-Shelui Road Section along central transport corridor. Preparation of 10YRoad Sector Investment Program and several sector studies: transport masterplan, environmental guidelines, etc. Source: IDA Project File Tanzania: Integrated Roads Project Page 19 Implementation Completion Report Part Il: Statistical Tables TABLE 3: PROJECT TIMETABLE Date actual! Steps in project cycle Date planned Latest estimate Identification/First Mission/ N/A Appraisal June 1989 June/July, 1989 Negotiations January 29,1990 April 10 to 13, 1990 Board presentations May 20, 1990 May 31, 1990 Signing September 1990 September 28,1990 Effectiveness December 28, 1990 March 15, 1991 Mid-term Review November 1992 November 20,1992 Project completion December 31, 1998 December 31, 1998 December 31,1999 December 31, 1999 Loan closing June 30,1999 June 30,1999 Source: IDA Project File TABLE 4: CREDIT DISBURSEMENT-CUMULATIVE ESTIMATE AND ACTUAL (US$ million) FY91 FY92 FY93 FY94 FY95 FY96 FY97 FY98 FY99 FOO Appraisal 12.93 41.23 75.53 114.12 142.41 163.86 175.86 181.00 181.00 181.00 estimate Actual 11.40 20.48 46.19 75.31 110.94 137.15 148.64 153.08 159.55 166.70 Actual as % of - 88.2 49.7 61.2 66.0 77.9 83.7 84.5 84.6 88.0 92.1 estimate Date of final disbursement was December 21, 1999. And the amount cancelled was USD31,165,978.54 Source: IDA Project File Tanzania: Integrated Roads Project Page 20 Implementation Completion Report Part Il: Statistical Tables TABLE 5A: KEY INDICATORS FOR PROJECT IMPLEMENTATION Training Under IDA Credit A. Trained Staff Abroad (I) Long Term SIN Course Year Total Trainees I M.SC. Highway Engineering 1992-94 9 2. M. Sc. Human Resource Management 1992-95 4 3 M. Sc. Construction Management 1994/95 3 4 M. Sc. Bridge Engineering 1994/95 1 5 M. Sc. Traffic Engineering 1994/95 1 6 M. Sc. Environment Engineering 1994/95 1 7 P.G. Highway Engineerng 1995/96 2 8 M. Sc. Transport Economy 1994/95 2 9 M. so. Mechanical Engineers 1991/92 2 Total 23 (11) Short Term 1 Material Management 1992 1 2 Financial Management 1992/95 7 3 Maintenance of survey Equipment 1992 1 4 Computerized Accounting Systems 1993 1 5 Public financing 1994 1 6 Road maintenance 1992 7 7 Records Management 1994 1 8 Traffic safety 1994 1 9 Mgt. Development for Executive Assistants 1992 4 10 Advanced Mgt. For Executive Assistants 1994 3 11 Human Resource Management 1995 4 12 Technical Audit 1995 3 13 Effective Chief executive Program 1995 2 |______-__ Total ______________ot l36 B. In-country Training (I) Long Term 1_______ |M. Sc. Highways Engineering (10 @batch) _ 1994/97 40 (II) Short Term 1 Financial management for Accountants (REDMA) 1994 120 2 Procurement of civil Works (ESAMI) 1992 120 3 Transport Planning for District Engineers and District Planning Officers (ESAMI) 1995 100 4 Computer courses for senior staff (IDM) 1993 13 5 Computer course for secretaries (IDM) 1993 26 Total 379 Source: MOW Tanzania: Integrated Roads Project Page 21 Implementation Completion Report Part II: Statistical Tables TABLE 5B: KEY INDICATORS FOR PROJECT IMPLEMENTATION Status of Trained Staff Under IDA Credit Present | Transferred Retrenched/ Death Abscond Total I Retired (I) Abroad Long Term 11 5 iT 1 23 Short Term 14 11 5 1 1 32 Total 25 16 10 2 2 55 (11) In Country Long Term 38 2 - 40 Short Term 1 336 32 8 3 379 Total 1 374 32 8 5 419 Source: MOW TABLE 5C: KEY INDICATORS FOR PROJECT IMPLEMENTATION PEHCOL (Plant and Equipment Hire Co. Ltd.) Activity No. of Plants No. of Vehicles 1. Various equipment were "rehabilitated" using dealers workshops 15 7 and PEHCOL's Central Workshop at Morogoro 2. Major Repairs 35 12 3. Upgrading at sight and various Branch workshops 19 47 Current Status Operative Non-operative ________________ (repairable) 1. Plants 53 24 2.Vehicles 35 9 Total IDA credit utilized US$11,450,562 (Nov. 1999) Source: PEHCOL, Nov,1999 TABLE 5D: KEY INDICATORS FOR PROJECT IMPLEMENTATION ROAD FUND EXPENDITURE ON ROADS (TANZANIAN SHILLINGS) FINANCIAL RATE OF I RP TARGET GOVERNMENT BUDGET ACTUAL DISBURSEMENT ACTUAL TO YEAR EXCHANGE IRP TARGET TsH/US$ US$ M TSHS. M US$ M TSHS. M US$ M 1991/92 284.45 16.11 0.0 2,036.69 7.16 44.4% 1992/93 407.43 16.11 5,167.37 12.68 5,167.37 12.68 78.7% 1993/94 501.66 18.41 7,648.60 15.25 8,515.41 16.97 92.2% 1994/95 540.82 34.30 15,187.52 28.08 16,265.56 30.08 87.7% 1995/96 561.61 34.73 17,093.62 30.44 11,000.14 19.59 56.4% 1996/97 601.25 34.91 20,000.00 33.26 15,993.94 26.60 76.2% 1997/98 620.00 36.10 20,000.00 32.22 14,999.00 24.17 66.9% 1998/99 675.82 38.80 22,250.00 32.91 15,625.00 23.12 59.6% 1999/00 750.00 41.86 26,304.00 35.07 SOURCES: PROJECT FILES & CARL BRO INTERNATIONAL A/S, COMPREHENSIVE REVIEW OF THE INTEGRATED ROADS PROJECT, THIRD INTERIM REPORT- RVISED JUNE 1997, & IDA SUPERVISION REPORTS. Tanzania: Integrated Roads Project Page 22 Implementation Completion Report Part 11: Statistical Tables TABLE 6A: KEY INDICATORS FOR PROJECT OPERATION ROADS CONDITION BY SURFACE TYPE SAR: Planned Paved Roads SAR: Planned Gravel Roads SAR: Earth Roads Total Total Good Fair Poor Total Good Fair Poor Total Good Fair Poor Road __ __ ___ __ __ _Length Km Km Km Km Km Km Km Km Km Km Km Km FY 90191 3,567 856 1,023 1,688 2,858 286 1,143 1,429 3,204 1,429 378 1,397 9,629 % Share 100% 24% 29% 47% 100% 10% 40% 50% 100% 45% 12% 43% 100% FY 91/92 3, 567 856 1,023 1,688 2,858 286 1,143 1,429 3,204 1,429 378 1,397 9,629 FY 92/93 3,566 1,299 934 1,333 2,877 344 1,135 1,398 3,164 1,398 376 1,390 9,607 FY 93/94 3,565 1,849 823 893 3,128 666 1,129 1,333 2,986 1,333 352 1,301 9,679 FY 94/95 3,781 2,863 664 254 3,636 1,912 934 790 2,129 790 285 1,054 9,546 FY 95/96 3,865 3,428 437 0 3,718 2,457 825 436 1,694 436 268 990 9,277 FY95/96 100% 89% 11% 0 0% 100% 66% 22% 12% 100% 26% 16% 58% Actual 3,921.55 2,317.6 1,162.9 441.05 3,526.6 773 2,097.8 655.8 2,782.2 3 760 2019.2 10,230.35 1998/99 % Share 100% 59% 30% 11 % 100% 22% 59% 19% 100% 0 27% 73% Total Good Total Fair Total Poor Grand Total Aggregate Good Fair Poor Total Planned 199119211 2571 2544 4514 9629 Percentage Share 27% 26% 47% 100% Actual 199819912 3,093.6 4,020.7 3,116.05 10,230.35 Percentage Share 30% 39% 30% 100% . _ Sources: 1. SAR; 2. MOW, actual April 1999. Tanzania: Integrated Roads Project Page 23 Implementation Completion Report Part Il: Statistical Tables Table 6B: Key Indicators of Project Operation Trunk Roads Operational Plan & Approved Budget ( sh million) Item Unit Sources of Physical Financial Plan 1999100 fund plan (km) Local Foreign Total 1 Routine & Recurrent Maint, for Paved Roads Km GOT 3,658 3332.56 0.00 3332.56 2 Routine & Recurrent Maintenance for Unpaved Km Got 3827 2057.07 0.00 2057.07 Roads 3 Periodic Maintenance (50km, Resealing 140 km) Km GOT 190 4,260.56 0.00 4,260 4 Spot Improvements and Emergency Km GOT/IDAI EDF 2625 2695.45 24,904.66 27,600.11 IADB/ SDC 5 . Bridges m. GOT 210 611.56 0.0 611.56 6 Special Projects: Replacements of Vehicles, GOT/NORAD 588.7 646.2 1234.90 Bridge Management 7 Overhead and Administration GOT 1011.5 0.00 1,011.5 Grand Total _ 10,300 14,557.4 25,550.86 40,108.26 Table 6C: Key Indicators of Project Operation Rural Roads Operational Plan & Budget (Tsh million) Item Km Source of Km Financial Plan 1999100 fund Local Foreign Total 1. Routine Recurrent Maintenance Km GOT 13932 5,154.50 5,154.50 2. Periodic maintenance Km GOT 341 3,792.00 3,792.00 3. Spot Improvement -Emergency Km GOT/IDA 4,375 1,204.67. 3,740.00 4,944.67 4. Bridge Maintenance m GOT 868.50 868.50 7. Administration and Overhead GOT 913.10 913.10 8. Total 18648 12,117.77 3,740.00 15,857.77 Source: MOW & IDA Project File Tanzania Integrated Roads Project Page 24 Implementation Completion Report Part Il: Statistical Tables TABLE 7: STUDIES INCLUDED IN PROJECT Study Purpose as defined at Status Impact of Study appraisallredefined 1. Project Review of the Investigate why: the present poor Completed Basis for review of the Gravel Roads condition of the road projects; failed road condition Rehabilitation Projects for inordinate delays in procurement of the Ministry of Works in goods and services under the Tanzania project; increase in costs; inadequate drainage structures 2. Comprehensive Review of Review of the status of Completed Basis of review of the the Integrated Toads implementation of IRP I status of the road Project project. 2. Zanzibar- Preparatory study Prepare for Zanzibar road projects Completed Likely to attract IDA financing 3. Procurement & Reg. Study Prepare basis for sound Completed None procurement practices in the country 4. Road Transport Service Review and optimization of Completed Basis for RETCOs Restructurng Study transport services restructuring 5. Civil Aviation Sub-sector Improve management Completed Had impacted profitability 6. Road Fund Study Recommendations for administrative Completed Basis for road fund arrangements for collection of heavy development vehicles license fees and transit fees TABLE 8A: PROJECT COSTS - IDA COMPONENT ONLY (US$ MILLION) CATEGORIES GOT IDA TOTAL GOT IDA TOTAL 1. Trunk road rehabilitation & upgrading 12.3 69.9 82.2 10.6 60.9 70.8 2. Other roads, bridges, buildings and road 6.6 37.2 43.8 7.9 44.8 52.7 maintenance works 3. Equipment for road contractors 0.0 5.7 5.7 0.0 0.0 0.0 4. Equipment, vehicles, spare parts and materials 0.0 8.9 8.9 0.0 13.6 13.6 5. Equipment, vehicles and spare parts for private 0.0 14.1 14.1 0.0 0.0 0.0 plant pools 6. Equiprnent higher hire for road maintenance by 15.4 8.3 23.7 4.8 2.6 7.4 REOs 7. Equipment and ferry repair contracts, including 0.0 6.7 6.7 0.0 0.01 0.0 transportation 8. Consultants' services 2.7 24.2 26.9 4.6 41.1 45.7 9. Training, seminars, fellowships and workshops 0.0 3.9 3.9 0.0 3.4 3.4 10. Project preparation fund 0.0 1.5 1.5 0.0 1.1 1.1 Total 37.0 180.4 217.4 28.0 166.7 194.7 SOURCE: IDA ESTIMATES. Tanzania Integrated Roads Project Page 25 Implementation Completion Report Part Il: Statistical Tables TABLE 8B: PROJECT FINANCING - TOTAL (US$ MILLION) Category Appraisal Actual IDA 180.4 166.70* DANIDA 57.0 80.00 FRG 32.0 54.8 ITALY 91.7 54.8 FINNIDA 48.4 10.00 ODA 13.6 4.8 UNDP/UNCDF 2.9 3.2 NORD 36.5 57.5 EEC 171.0 193.7 USAID 32.7 62.00 The Netherlands 18.0 25.5 Switzerland 10.8 16.9 Ireland 4.8 4.8 AfDF 45.2 58.9 SAUDI FUND 11.8 9.9 Financing Gap 33.8 0.0 Government of Tanzania 80.5 60.0 Total 871.1 868.0 Source: Project Accounts , financial year 1997/98 as submitted for Audit by MOW. * the figure for IDA is as of Dec. 21,1999. Table 9: Economic Costs and Benefits The combined Economic Rate of Retumi for Tanga-HorhorolMaranga-Tarakea road is 29% includiiig cost of bridges planned to be imnplemented.. Tanzania Integrated Roads Project Page 26 Implementation Completion Report Part II: Statistical Tables TABLE 10: STATUS OF LEGAL COVENANTS Section. Covnt. Present Original Revised Description Comments Covenant Class Status Fulfillment fulfillme Of Type Date nt Date Covenant Section 09 C 12131/93 Borrower shall undertake a general Complied 3.03 revision of its procurement with partially regulations and commence but not implementation by Dec. 31, 1993. implemented Section 02 C Borrower shall increase its revenue Complied 3.04 collection, primarily through revenue with. intake from road users. Section 02 C Borrower not to undertake road Complied 3.05 sector investments of more than $3.0 with partially million unless such investment have but not economic rates of return of at least implemented 12%. Section 12 C 12/31/93 Borrower shall furnish to the Complied with 3.06 Association a plan of Action to improve the delivery of urban passenger transport services in Dar- es-Salaam, including institutional reorganization and an appropriate price policy. Schedule 01 CD Borrower shall furnish IDA certified Complied with 4.01 copies of the audit report not later after delays than six months after end of each fiscal year. Schedule4, 02 CP The Borrower shall carry out an Complied with 2(i) annual review with IDA and other partially participating donors of the performance under the road network stabilization program and the next three years of the road investment and maintenance activities. Schedule 4 02 CP Borrower to reach agreement with Complied with para. 2(ii) IDA on the budget estimates for the partially following fiscal year for the rehabilitation and maintenance of the trunk roads network and regional networks in the core regions. Schedule 4 04 NC Borrower to progressively increase its Complied with para. 3 annual contribution to funding road partially. maintenance, with the objective of Governt's fully covering road maintenance share of road requirements from the Borrowers maintenance own sources by FY1995/96. is increasing but not as expected. Schedule 4 05 C 11/30/199 Borrower shall conduct the following Complied with para. 4 2 workshops: (i) project launch workshop; (ii) annual workshops; (iii) annual donors conference; and (iv) a comprehensive implementation review workshops. Tanzania Integrated Roads Project Page 27 Implementation Completion Report Part II: Statistical Tables Section. Covnt. Present Original Revised Description Comments Covenant Class Status Fulfillment fulfillme Of Type Date nt Date Covenant Schedule 4 05 C MWCT to carry out a study to Complied para. 5 (b) determine the feasibility of with. Strategy establishing CML, as a financial has been autonomous private plant pools which discussed would be allowed to charge commercial rate for the plant hire. Schedule 4 05 C Road maintenance equipment Complied para. 6 (i) reconditioned under the project shall with. be consigned to MWCT's plant pool Equipment for hire by REOs and Contractors. transferred to PEHCOL Schedule 4 03 NC One or more private plant pools to be Effort para. 6 (ii) competitively selected and to be discontinued required to provide guaranteed with IDA service to MWCT for the duration of agreement the project. Schedule 4 05 C Borrower to prepare study of details Complied para. 6 (iii) of MWCT and private plant pools and with. on the basis of that to prepare an PEHCOL action plan for establishment of the experiencing autonomous private plant tools which equipment would be allowed to charge management commercial rate for the plant hire. problems. Schedule 4 05 C 12/31/199 Borrower shall formulate a program Complied with para. 7 1 for its vehicle weight control and road safety programs. Schedule 4, 06 C Borrower to ensure that the Complied with para 8 environmental conditions included in the TOR for studies and conditions of the contract for procurement of works and goals Source: Project file Action Taken: Covenant type C = Covenant complied with 1 = Account/Audits CD = Complied with after delay 2 = Financial performance/revenue generation from beneficiaries CP = Complied with partially 3 = flow and utilization of project funds NC = Not complied with 4 = Counterpart funding 5 = Management aspects of project or executing agency 6 = Environmental covenants 7 = Involuntary resettlement 8 = Indigenous people 9 = Monitoring, review, and reporting 10 = Project implementation not covered by categories 1-9 11 = Sectoral or cross-sectoral budgetary or other resource allocation 12 = Sectoral or cross-sectoral policylregulatory/institutional action 13 = other Tanzania: Integrated Roads Project Page 28 Implementation Completion Report Part II: Statistical Tables TABLE 11: COMPLIANCE WITH OPERATIONAL MANUAL STATEMENTS Statement number and title Description and comment on lack of compliance Appendix I of Paragraph 3 of the guidelines for procurement under IDA Credit on modification states that, 'Modifications 3. In the case of contracts subject to pdior review, before granting a material extension of the stipulated time for performance of a contract, agreeing to any modification or waiver of the conditions of such contract, including issuing any change in order or orders under such contract (except in cases of extreme urgency) which would in aggregate increase the original amount by more than 15% percent of the original price, the borrower shall inform the Bank of the proposed extension, modification, or change order and the reasons therefor. If the Bank determines that the proposal would be inconsistent with the provisions of the Credit Agreement, it shall promptly inform the borrower and state the reasons for tits determination. A copy of all amendments to the contracts shall be furnished to the Bank for record." The Borrower has undertaken substantial modification contrary to the above. See for detail the section on gravel roads in this ICR. TABLE 12: BANK RESOURCES: STAFF INPUTS Stage of project cycle 0Actual Staff week US$ '000 Through appraisal 158.9 403.3 Appraisal- Board effectiveness 11.6 31.9 Supervision 406.1 1,305.5 Completion 14.0 28.00 Total 600.6 1,792.7 Source: Project Data Base Tanzania Integrated Roads Project Page 29 Implementation Completion Report Part 11: Statistical Tables TABLE 13: BANK RESOURCES: MISSIONS Stage of Month/ Number SW Specialized Performance Rating project cycle Year of in staff skills - DO Types of problems persons field represented Identification/ March 6 NA E (2), TE, FA, Preparation 1988 OA, PS Appraisal June- 10 E, TE, VT, HE _ July, (2), OA, IS, 1989 ME, AS, FA Board approval to effectiveness Supervision I Feb.'90 4 NA E, TE, ES, OA - Issues: budget, revision of procurement regulation, domestic construction policy paper, pending consulting and civil works contracts. Supervision II Oct. Nov. 4 FA, PS, ES, HE, - Interim Procurement Guidelines and Standard Procurement Guidelines; &. new 1990 organization established and key positions to be approved; PEHCOL to be established. Implementation behind schedule; need for strengthening planing and programming; strengthen MIS function; but, good progress in No. contracts let and ______________ _________ ________ physical progress. Supervision III Nov. '90 2 NA FA, HE, - - Initiating mission for TA of ATC;& Road Maintenance Initiatives Phase II. Supervision IV Feb. 92 1 NA FA 1 1 Credit effectiveness was delayed from December 28, 1990 to March 15, 1991 to allow time for: (a) standard procurement documents to be submitted to the Attorney General of Chambers and to IDA for clearance; (b) circular implementing the interim procurement guidelines to be submitted to IDA, together with guidelines; (c) taxation issues to be resolved between MOF, MOW and MCT, in accordance to the interim guideline; (d) draft bidding documents for the private plant pool to be completed to IDA's satisfaction; (e) new organization to be implemented, and key positions filled; (f) short listed companies to be invited to submit proposals for the public procurement and supplies management study; and (g) submission to IDA of the adoption of the National Construction Development Strategy. Arrangement for Technical assistance to Air Tanzania. Project March Effective 15,1991 _ _ Tanzania Integrated Roads Project Page 30 Implementation Completion Report Part I: Statistical Tables Supervision I May 1 FA NA NA Control, monitoring and management information system to be strengthened in most 1991 areas and in the Ministry as a whole. Attomey General of chambers have yet to formally approve the Std. Procurement Documents Guidelines. Circular to implement Interim Procurement Guidelines has yet to be issued by MOF. Proposed reorganization awaiting presidential approval -trunk and rural roads grouped as agreed at negotiation. PEHCOL establishment and appointment of Board not completed. Supervision 11 February 2 NA FA, OA NA NA Progress satisfactory, especially in civil works; but slower in road fund, REO's. training, organization than initially anticipated. Signs are beginning to show that management and control of program requires a little more attention especially project controls and procedures; bureaucratic delays, increased expectation and some loss of focus on priority activities. Special attention to equipment rehabilitation and maintenance. Supervision IlIl May '92 1 NA FA NA NA RMI Road fund, RA related issues. Supervision IV July '92 2 NA FA (2), PS 2 2 Management and control of the program requires more attention- strengthening project performance through improved accounting, procurement reporting procedures and systematic physical verification of works; contract processing time on some recent ICB civil works tenders was reduced to about 150 days compared to more than a year on previous tenders; 66% and 63% of targets for rehabilitation of trunk and rural roads respectively achieved in FY91/92. Perception in the donor community is that the release of routine maintenance funds to the regional engineer's offices were lower than budgeted and often late; strong management effort required to make PEHCOL operate; coordination between MOW and MCW to allocate resources in the light of operational needs should be strengthened; careful prioritization of investments in light of available resources is ____________ .required; more effective monitoring project performance required. Supervision V Sept.'92 3 NA FA (2), HE NA NA Delays and low level release of road maintenance funds- in Jan.93 govt. increase fuel toll tax from Tsh 1 Ofiter to Tsh2O/iter; vehicle licensing & transfer fees also increased Supervision VI Nov. '92 1 NA DC NA NA Mid-term. Well organized, and presentations by Govemment representatives were of high quality. Issues: financing of road maintenance and provision of equipment for maintenance and rehabilitation to meet donors' concems. Supervision VII* Mar. 93 4 17.2 FA, PS, OA, HE 2 2 Change in scope of work on Dar es Salaam roads do not have revised cost estimates; weak contractor performance on some road packages causing delays. PEHCOL's equipment fleet continue to deteriorate at a rapid rate; a candidate was approved to fill the post of director general of PEHCOL. Procurement delays due on some periodic maintenance contracts and on Mwanza- Nzega road due to non-standard documentation and non-adherence to procedures. Procurement study delayed substantially due to changes in consultant team _____________ _ composition and on TOR. * Archive is trying to locate the full SPNs for the rest of 1993 and May 1994. Tanzania Integrated Roads Project Page 31 Imrplementation Completion Report Part II: Statistical Tables Supervision Vil Dec. 2 NA HE, HE S HS Substantial changes in scope of works and costs; there appears a need to strengthen 1994 monitoring; design documentation not adequate; behind schedule as a result of constant changes in scope of works and as a result of inadequate project design documentation. Development fund not adequate for 1994/95; need for development fund; road maintenance funding to be maintained to the planned level. PEHCOL facing series problems; funds for procurement of spare parts, substantial arrears of hiring charges from the regional engineers; frequent breakdown of its equipment fleet; & fast deterioration. Supervision IX April 2 NA FA, HE S HS Engaged consultant to: reevaluate the project components; prepare contract 1995 addenda for Babati area, Dar es Salaam and Tunduma-Sumbuwanga roads; plans for funding development budget requirement for FY 1995/96 as the budget for 1994/95 was fully spent by end of second quarter. MWCT used Tsh.630 out of the road fund to finance rehabilitation of gravel roads. Preparation of training proposals; while substantial resources were devoted to training not enough emphasis was being given to basic aspect of procurement and contract administration procedures Supervision X June 2 2.3 FA, HE S S Concern on need to improve financial accounting and management, performance 1995 monitoring and accountability and transparency. Design documentation not adequate and contributed to increased cost of project implementation. Development budget not adequate for 1995/96; counterpart funding major constraints; maintenance funding being maintained at planned level. Supervision XIl Septemb 2 NA FA, HE U S Problems: addressing road maintenance funding; certain problems in areas of er 1995 management of project implementation, equipment management and development budget expenditures. Substantial cost increases on several of the rehabilitation works, especially Babati Area Roads and Dar-es- Salaam Region Emergency Road Program, due primary to changes in scope of works, because of inadequate original designs; long elapsed time between original design and commencement of works; and substantial increase in traffic. Development Budget insufficient for the 1995/96 budget. Supervision XII January 1 3 HE, FA U S Overall project implementation performance is unsatisfactory, monthly 1996 disbursements, show a downward trend. With substantial changes in the scope of works and substantial cost increase, the adequacy of funding the credit is uncertain. There is a need to strengthen the monitoring of project implementation. There is a need to introduce a system to monitor these changes and associated costs to report them to the funding agencies. Design documentation not adequate and contribute to the increased costs of project implementation. There is need to update all non- committed design and supervision contracts. The development budget not sufficient to cover expected expenditure for FY95/96. Level of the maintenance funding being maintained to the planned level. PEHCOL continues to face serious problems. Procurement in spare parts, frequent break down of its old equipment fleet are most seriously constraints. Need for a through review of PEHCOL's role and decision on its future or existence. Tanzania Integrated Roads Project Page 32 Implementation Completion Report Part 11: Statistical Tables Supervision Xil May 1996 4 3.3 HE, FA, CE, R U S Govemment had been using Road Funds for rehabilitation works instead of carrying road maintenance works; several trunk roads (gravel) were rehabilitated without engineering designs and without Bank's no-objection; majority of them have construction failures as a result of the construction without engineering design and Bank's objection. Project to be restructured. Substantial cost increases have occurred on IDA financed components; procurement and contract management weakness including financial management & monitoring. Work program constrained by availability of development budget resources. Construction failures have occurred on roads which were improved under the projects, particularly on Babati Area Tunduma-Sumbawanga and Usagara- Lusahunga roads; Project expenditure do not reflect all expenditures incurred under the project. Long elapsed times between receipt of tenders and the award and commencement of works; weakness in contract financial management and control & increase in the scope of works during execution Supervision XIV Dec.96 2 0.6 HE, FA U U Same as above. No change. Supervision XV April 1997 2 2.4 HE, FA U U Lack of funding and unauthorized use of road funds for other purposes other than maintenance. Institutional set-up to handle the volume and size of project inadequate. Supervision XVI Oct. 97 3 2.9 HE, FA, TA U U Same as above. No significant change Supervision August U U Credit agreement amended on August 7, 1998. Major issue related to lack of financial XVII 1998 management have been addressed and mitigating measures with an agreed detailed action plan were being implemented. Supervision Nov. 1998 3 0.4 HE, FA, TA U U Slow progress and disbursement since June 1998. Audits of Project Accounts, XVIII inclusive of SOE and SA for FY 96/97 submitted to IDA were seriously qualified. On Mwanza Mogogo River Section contractor formally lifted the 'slowdown of works" on June 20, 1998. Works done generally satisfactory. Request for submission for Addenda for gravel roads (i) Lusahunga-Usagara Road; (ii) (Tunduma-Liche (Sumbawanga) Road: (iii) Shelui-Singida-Babti-Bereku Road; and (iv) Tanga-Horohor and Marangu-Tarakea Roads. No official handling of these roads were made. Supervision March 1999 3 HE, FA, TA U U MOW requested the financing of Tunduma-Sumbawanga (gravel, emergency) Road XXIV under IRP II. It was to be financed from IRP I but could not due to delays in procurement. Several Addendum were approved for payments. Emergency support _____________ following El Nino damages of the road network is being provided. Supervision July 1999 2 HE, FA U U Credit closed on June 30, 1999. MOW submitted draft accounts with reconciliation of XXV expenditures and payments together with associated re-allocation of the credit categories. US$ 12.9 million due to delays and about US$19 million due to exchange rate fluctuation is expected to be cancelled. anzania n:egra:ec ,oacs -rojec: Implementation Completion Report Part II: Statistical Tables AS =Admin. & Secretary TE= Transport Engineer E = Economist RR =Rural Roads Transport Specialist ES = Equipment Specialist VT = Vocational Training HE = Highway Engineer TA= Task Assistant FA = Financial Analyst IS= Institutional Specialist PS = Procurement Specialist DC- Division Chief OA = Operation Analyst 00 = Operation Officer Tanzania Integrated Roads Project Page 34 Implementation Completion Report Part II: Statistical Tables ANNEX A: SUPPLEMENTARY STATSTICS TABLE 1: REALLOCATION OF CREDIT 2149-TA No Category SAR (SDR) Revision I Revision II Disbursed Disbursed (USD) Sep.20, 90 (SDR) Aug. (SDR) 12 (SDR) Jan17, Jan. 17, 00 21, 91 Oct, 92 00 Trunk road rehabilitation and upgrading la Lusahunga-Usagra; 20,700,000 20,700,000 20,750,000 17140089.13 24,019,758.43 Tunduma-Luiche; Shelui- .____ Berku 1.b Tabora/Nzega/-Singida 14,300,000 14,300,000 10,000,000 7068230.61 10,063,339.33 border; &Dodoma-Singa 1.c Mwanza-Usagara-Nzega; 13,600,000 13,600,000 15,100,000 13140276.28 18,889,349.08 and Sonea-Masai 1.d Rehab. Tanzam 2, 4 & 5 0.0 6,600,000 6,500,000 4952731.92 7,123,949.78 2. Other roads, bridges, 26,000,000 26,000,000 29,200,000 31281793.98 44825,732.32 buildings and road maintenance works , 3. Equipment for road 3,900,000 3,900,000 3,900,000 0.0 0.0 contractors 7 4. Equipment, vehicles, spare 6,200,000 6,200,000 12,580,000 947,423.25 13565,367.93 parts and materials 5. Equipment vehicles and 9,800,000 9,800,000 0.0 , 0.0 0.0 spare parts for private plant pools 6. Equipment hire for road 5,800,000 5,800,000 5,800,000 1,818294.51 2,611,051.67 maintenance by REOs 7. Equipment and ferry repair 4,600,000 4,600,000 4,600,000 4,350.81 6,332.34 contracts including transportation 8 Consultant services 16,900,000 16,900,000 27,700,000 29,004,175.60 41,149,686.25 9 Training, seminars, 2,700,000 2,700,000 3,014,000 2344055.06 3361886.72 fellowships and workshops 10 Refunding of project 1,200,000 1,200,000 770,000 769930.23 1,072,520.50 preparation advance 11. Unallocated 14,200,000 8,200,000 0 0.0 0.0 Total 139,900,000 139,900,000 139,900,000 117204418.64 166,698,969.78 Original Credit Principal 139,900,000 180,400,000.00 Amount Tanzania Integrated Roads Project Page 35 Implementation Completion Report Part II: Statistical Tables Table 2: Status of IDA Financed Component as of July 1999 (US Dollars) Category Component Description Total Total Paid Ref. Committed To Date USD USD 1 a Lusahunga-Usagara 6,069,740 6,069,740 1 a Tundoma/Luichet (Sumbawanga) 8,702,892 8,702,892 1 a Shelui-SingidalBabati/Bereku 8,178,078 8,178,078 la Sub Total: Cat la 22,950,710 22,950,710 lb Tanga/Horohoro & Marangu Tarakea 9,099,438 9,099,438 lc Mwanza/Shiny. Bdr- Contract 1 19,107,237 18,628,912 Id Rehab. - Tanzam 2 3,999,922 3,999,922 1d Rehab. - Tanzam 4 5,368,290 5,368,290 1d Rehab. -Tanzam 5 96,319 96,319 1d Sub Total: Cat Id 9,464,531 9,464,531 I Sub Total: Cat 1 60,621,916 60,143,591 2 lCulverts and Temporary Bridges 0 0 2 Per. Maint./Emerg. Works to mid-1995 35,767,620 35,343,683 2 Renov.-MOW/MCT & REO Facilities 672,387 613,216 2 Kyaka Bridges Civil Works 7,741,022 7,741,022 2 Sub Total: Cat 2 4,181,029 43,697,921 3 Sub Total: Cat3 0 0 4 iRSAWC Program -Equipment 528,635 528635 4 Equipment Rehab., Plant & Vehicles 1,902,902 1,312,027 4 CML - Laboratory Equipment 572,126 572,126 4 PEHCOL: Vehicles. Tyres & Spares 6,757,682 6,757,682 4 OfficeNv.Shops, Tools & Radio NhM 388,998 388,998 4 Vehicles, Motorbikes & Bicycles 2,849,385 2,849,385 4 Sub Total: Cat 4 12,999,728 12,408,853 6 MWCT: Equipment Hire to mid-i 995 2,567,494 2,567,494 6 Sub Total: Cat 6 2,567,494 2,567,494 7 Ferries - Overhaul Equip. and Spares 6,340 6,340 7 Sub Total: Cat 7 6,340 6,340 Tanzania Integrated Roads Project Page 36 Implementation Completion Report Part II: Statistical Tables Table 2: Status of IDA Financed Component as of July 1999 (US Dollars) 8 Gravel Road Study & CODAP 2,960,908 2,960,908 8 Zanzibar-Preparatory Study 762,772 762,772 8 Procurement & Reg. Study -MOF Training 2,661,707 2,661,707 8 Mwanza/UsagaralNzega Supervision 6,374,951 5,464,162 8 Gravel Roads Supervision 1,592,566 1,592,566 8 Technical Assistance to PEHCOL 2,477,463 2,477,463 8 Management Assistance to ATC 3,152,087 2,990,262 8 Inst. Support: Works Inspectorate 752,776 752,776 8 REO's Mwanza & Shinyanga 2,603,644 2,603,644 8 Management and Administration 401,036 401,036 8 Technical Assistance to CML 249,259 249,259 8 Planning & Operations Management 2,136,868 2,136,868 -8 Other Studies 1,421,905 1,421,905 8 MWCTI- Training TA & Equipment 406,567 406,567 8 NCC/Contractor Training & Mngt. 783,060 783,060 8 Construction Research 125,542 125,542 8 NIT-Training TA & Equipment 1,295,181 1,295,181 8 Communications & Office Technology 130,542 130,542 8 DTC Computer Laboratory 431,014 431,014 8 Bridge Design 2,127,443 2,127,443 8 Kyaka Bridge Supervision 1,098,974 1,098,974 8 Per. Maint./Emerg. Works Supervision 4,286,415 4,286,415 8 Tanzam Supervision 1,085,599 1,085,599 8 Morogoro/Dodoma Reseal Supv. 269,976 269,976 8 Assistance to NTC, RETCO's 1,946,168 1,946,168 8 Study for Dodoma - Minjingu 61,676 61,676 8 lAssistance for DSM Passenger Trans. 363,325 363,325 8 Sub Total: Cat 8 41,959,424 40,886,810 9 MWTI Programme - Training Facilities 235,518 235,518 9 MWCT/M,P,T - Seminar/Workshops 875,798 875,798 9 - Overseas Training 1,408,996 1,408,996 9 - Local Training 658,748 658,748 9 LBWT - Training Equipment 772,739 772,739 9 NIT - Training Facilities 122,976 122,976 9 Sub Total: Cat 9 4,074,775 4,074,775 10 Project Preparation 1,072,521 1,072,521 10 Sub Total: Cat 10 1,072,521 1,072,521 GRAND TOTAL: 167,483,226 164,858,306 Original Credit Principal amount 180,400,000 Amount to be Canceled 12,916,774 Note 1: In addition to the canceled amount, about US$19 million will not be utilized Note 2: Total paid to date represents payments processed to date by the Project. Tanzania Integrated Roads Project Page 37 Implementation Completion Report Part II: Statistical Tables Table 3: Project Expenditure as of June 30, 1998 Source for Fund SAR estimates Estimated Final Variation (%) (USD) (USD) (USD) Other Donors A. Institutional support 34,392,700 72,064,513.0 210 B. Rehabilitation 386,112,700.00 509,618,834.47 132 C. Maintenance 0.00 0.00 D. Transport 0.00 0.00 Sub-total 420,505,400.00 581,683,347.47 138 IDA A. lnstitutional support 30,173,000.00 38,748,879.99 128 B. Rehabilitation 84,956,400 49,063,225.65 58 C. Maintenance 60,278,300.00 56,373,894.62 94 D. Transport 5,016,900.00 5,218,118.46 104 Sub-total 180,424,600.00 149,404,118.46 83 Tot Donors expenditures 600,930,000.00 731,087,465.93 122 Source: Carl Bra Intemational a/s Comprehensive Review of the Integrated Roads Project, Third Interim Repor Revised, June 1997 Tanzania Integrated Roads Project Page 38 Implementation Completion Report Annex B: ICR Mission Aide Memoire Annex B The United Republic of Tanzania INTEGRATED ROADS PROJECT (CREDIT 2149-TA) Implementing Completion Reporting Mission Aide-Memoire November 2-18, 1999 1. The Integrated Roads Project I became effective on March 15, 1991 and closed on June 30, 1999 following a one-year extension from the original closing date of June 30, 1998. From the standpoint of lessons learned, the implementation experence of IRP I can be very valuable. A careful review of the implementation environment which by most account, led to less than outcome than would have been expected otherwise, warrant the attention of all concerned in the development of Tanzania road sector. However, despite difficult operating environment facing project implementation, the project has had significant impact on transport operation. Overall vehicle operating costs and travel time has reduced. Significant number of staff has been trained. Under the project initiatives such as the Zanzibar's ZIROP Study covering road network, road financing and institutional reforms for Zanzibar for FY 2000-2009 have been successfully completed. IRP I will have relevant lessons of experience for the Zanzibar project. 1. The Scope of the Project 2. The Integrated Roads Project' (IRP 1) was the largest single donor supported infrastructure and capacity building project in Africa. With a total cost of US$ 871.1 million, the project was to be parallel financed by Government of Tanzania with the support of IDA, DANIDA, Federal Republic of Germany, Italy, FINNIDA, ODA (UK), NORD, EEC, USAID, The Netherlands, Switzerland, Ireland, the African Development Fund, UNDP, and the Saudi Fund. The donors committed themselves to contribute an initial amount of US$790.6 million. The Govemment of Tanzania, in addition to meeting the annual road maintenance budget requirements, also committed itself US$ 80.5 million towards counterpart financing of the Project. At the launching of the Project there was thus only US$33.8 million financing gap. 3. The primary objective of the IRP I was to restore Tanzania's trunk and regional road networks which have proved to be obstacle to the sustainability of the economic recovery program the country was undertaking; and to develop MOWs institutional capacity to properly manage the road networks. The project was justified on the ground that reduction of transport costs and accessibility to the primary agricultural areas were essential to the economic recovery of Tanzania and the structural reforms underway. 4. IRP I represented a significant challenge to the Govemment, the implementing agencies and the participating donors. Under IRP I, some 1,700 km of paved trunk roads were planned to be rehabilitated or resealed representing 61% of the total Project cost with overall ERR estimated at 24%; and 2,550 km unpaved trunk roads with an overall ERR of 19%; and some 3,000 km of regionaVruraV/ roads in eleven of the regions representing 30% of the total roads with estimated ERR of 37%. IRP I targets were to transform 60% of the trunk roads into good condition from the then level of 15%; and to improve to good condition regional roads to 50% from the 10% level for the network in the eleven regions. Some 30 bridges, minor structures and 10 ferry vehicular crossings, renovation of MCW head quarters, REO offices, and upgrading office technology were to be financed. Also, road maintenance support program including establishment and equipping of privately operated plants pools, rehabilitation of existing equipment and road maintenance by contract, hiring of equipment from plant pools, and emergency works were to be undertaken. ' The name "project" is a misnomer. The term "program " would have been a more accurate description. Tanzania Integrated Roads Project Page 39 Implementation Completion Report Annex B: ICR Mission Aide Memoire Most important, under IRP I, GoT was to institute regular maintenance on 80% of the trunk roads and 60% of the regional network. 5. Institutional support to strengthen Tanzania's road management capacity including support to MCW management and the regional Engineers offices, domestic contractors, University of Dar es Salaam Engineering Faculty, Arusha Technical College, Central Laboratory, technician training at the Morogoro Training Institute, road safety program, labor based construction methods, revision of Government procurement regulations, and project coordination. Technical assistance to National Transport Corporation, Regional Transport Corporations and to improve Dar es Salaam passenger transport. The project had also a component to provide management assistance to Air Tanzania Corporation. In brief, the project as designed had too many components dealing with very many issues with many actors on the scene. II. Views of the Stakeholders 6. The mission has opportunity to solicit the views of implementing agencies, donors and the beneficiaries of IRP I. All agreed that the project was not only large in investment size but also complex as evidenced from the scope of the project. Because of the long project cycle of IRP I, 1988 to 1999 from inception to completion, there are not many left in Dar es Salaam among those who played part in the implementation of IRP I. Moreover, institutional memory was also weak. What follows is the composite view of the development issues that emerges from synthesis of the views of various stakeholders in the implementation experience of IRP I. 7. For some, the project was not focussed and difficult to manage. What made the project more complex and challenging to implement even more than the large number of components, was the difficult implementation environment the country had found itself in its transition to market economy. Moreover, many of the underlying assumptions, which were deemed essential at appraisal to the success of the project, did not materialized on time. Implementation capacity to undertake procurement and technical management of the project was not ready when the project was launched. Incentives to the implementing agencies staff were either inadequate or non- existence to mobilize the human resources to implement the project within budget and on schedule. Counterpart funding was not available when it was wanted and in the amount needed; the economy was experiencing fiscal imbalances and inflation. The rate of donors' funding in- flow over the implementation period was not reliable and was not forth coming as was expected at the beginning of the project. These and other constraints created unfavorable implementation environment with significant adverse impact on the sector and the economy as a whole. As noted above, the diverse scope of the Project also added to the complexity of its implementation. Moreover, achieving effective donor coordination, addressing cross cutting institutional issues in the areas of commercialization, capacity building, road fund, reorganization, and public-private operations, add to the complexity of the implementation environment. 8. In light of the complex and unfavorable implementation environment, achieving the physical targets set at appraisal within budget and timeframe at a satisfactory level of quality had proved to be quite a difficult challenge. Most important, the original targets were made unattainable by the reduced resource in-flows of the donors and the government counter part funding. The resource in-flows expected from the donors were not available for disbursement when they were needed and where available were not disbursed in the amount desired due to lack of counterpart funding. The Government was facing continued difficulties either in generating and/or in availing resources for road maintenance and rehabilitation. Some attribute the shortage of counterpart funding partly due to crowding of its budget with expenditures of lesser priorities. Nevertheless, throughout project implementation counterpart funding remained a major concern among the donors. Also during implementation donors were concerned about the adequacy of maintenance funding. In fact it was GOT's commitment to provide adequate and sustainable resources for maintenance which was the primary factor which drew donors as partners in IRP I in the first place. However, maintenance fund was not available at the amount Tanzania Integrated Roads Project Page 40 Implementation Completion Report Annex B: ICR Mission Aide Memoire needed as committed at the start of the project. For many donors, adequate maintenance funding and appropriate institutional set-up were the key issues, which needed for addressing the transport issues facing the country. The corrupt practices reported in the Warioba Commission Report on Corruption, 1995/96 and in views of donors subsequent delayed action by GoT to deal with the issues raised in the Report, for the most part cooled donor's response to IRP I. Procurement problems and deficient contract management further complicated the situation as did inflated construction costs both on account of poor contract management; exchange rate depreciation and delayed interest charges due to the continued deterioration of the economic condition. In-flow of Development Expenditure for IRP I Year 89/90 | 90/91 91/92 | 92/93 94/94 94/95 95/96 96/97 i % | 9.71 1 11.2 13.21 1 20.37 19.08 7.21 1.27 9. According to a 1996 government's commissioned review of the IRP I, in the first five years of the project (1991-96) alone, some US$ 105.0 million has been utilized for institutional support by donors participating in IRP I, mostly in an uncoordinated manner. In the construction industry, the response of the private sector was highly positive. In anticipation of growing effective demand for civil works contractors under IRP I fund, many new construction firms continue to be established. However, as shown in the table above, the development budget after peaking in 1992/93, was continued declining from the peak of 20.37% to 1.27% by 1995/96. The government disbursement of the maintenance budget, which was even more important to the newly formed companies, was uncertain. The government was facing difficulties allocating funds for sustaining the required level of maintenance even while operating its budget on cash basis. The result was that many contractors were unable to find contracts in the shrinking construction sector market. Thus, the uncertain disbursement from the maintenance fund further exasperated the plight of the newly established firms. Many did not survive their infancy. Attempt was made to ameliorate the plight of the new entrepreneurs through the introduction of smaller contract packages by some donors. 10. The condition facing capacity building of MoW was not any better. The environment, in which the project was being implemented, here too, proved to be unfavorable. While the MoW manpower capability was increasing, the Ministry was facing shrinking development budget inflow. For example, the capacity building program for MoW provided opportunities for some 437 participants to get short term and long term training. Some 63 of the staff successfully graduated with Masters of Science Degrees in civil engineering from Dar es Salaam University and other foreign universities. The result is that MoW has now some 331 engineers with a significant number of them with post graduate training. This represents a low ratio of km of maintainable roads per engineer, which in it is no small achievement. However, following graduation, because of the declining of the rehabilitation and maintenance funds flows, the trained staff did not get the opportunity to use their training into practice immediately following their training. Although, the individual capabilities and MOWs capabilities have increased as a result of the training, the prevailing view to day is that the training provided had not overall as yet translated to higher efficiency or effectiveness in MoW. In part this is attributed to the merger of MOW and MCT to MWCT and subsequent division again to MOW and MCT, the lack of incentives for good performers as well as due to the prevailing organizational culture. In any case, it was the systemic problem facing capacity building in the face of shrinking effective demand in the contracting industry, which became a focus of the ICR implementation mission discussions. Tanzania Integrated Roads Project Page 41 Implementation Completion Report Annex B: ICR Mission Aide Memoire III. Bank Mission Observations 11. Overall, most stakeholders appreciate and acknowledge the outcome and impact of IRP I has achieved in terms of transport cost and travel time reductions. Because the project has been around for more than a decade since its inception in 1988, in most institutions the relevant people available for discussion are new to their post and there is little institutional memory. For the most stakeholders' participants, lack of institutional memory was a handicap to make effective contribution to the evaluation exercise. As noted above, the main issues they raised tend to focus more on reaching an understanding of why the promise of booming private sector local construction industry did not materialized under IRPI. Also quality of construction, particularly of the gravel roads, cost overrun, contract management, delays in procurement and quality of technical management, road fund, timely flow of maintenance fund, road organization were touched. These and related issues will be further addressed in perspective in the ICR. IV. Operational Plan 12. Adequate maintenance funds and timely utilization of available funds for maintenance will be the key indicators of government commitment to the sustainability of the physical assets and institutional capacities established under the project. The establishment of the Road Fund Board is expected to contribute to the timely disbursement of sustained adequate maintenance fund. 13. The mission reviewed the rolling budget for road infrastructure for 1999/2001. While underscoring the need for provision of adequate operation and maintenance funds, the mission was heartened to note that both at central and regional level there is acute consciousness for road maintenance fund, particularly among the local contractors in the construction industry. They are likely to be an important source of pressure on the Ministry of Finance in the road network management in Tanzania. V. Payment after Loan Closing Date 14. The mission has informed the implementing agencies that in accordance with the World Bank disbursement rules in effect all expenditures incurred prior to the closing date could be paid from the loan and only for expenses submitted up to the grace period of four months after the closing date (June 30, 1999). VI. Briefing & Schedule of Preparation of ICR 15. The mission briefed staff of the various implementing agencies charged with the responsibility of contributing to the drafting of the government evaluation report, on Bank's requirement regarding government contribution to the ICR on the need of building capacity in evaluation and monitoring. The mission had followed on the July, 1999 supervision mission that requested the borrower to proceed with the preparation of its contribution to the ICR. 16. The individual implementing agencies have completed their evaluation and provided their input to MoW. MoW will prepare and submit the borrower's contribution to the ICR to IDA by December 6, 1999. The mandatory last date for delivery of the ICR to World Bank executive Board is December 31, 1999. It was agreed to complete the preparation of the ICR for delivery to the Board based on the following schedule: Tanzania Integrated Roads Project Page 42 Implementation Completion Report Annex B: ICR Mission Aide Memoire Agreed Schedule of ICR Delivery. * Data on Operational Plan of IRP I November 30, 1999 * Post construction ERR re-estimates December 10, 1999 * Borrower contribution to the Bank December 16, 1999 * Draft ICR for intemal Bank management review December 16, 1999 * Draft ICR for Govemment Comments December 22, 1999 * Draft final ICR for Bank Executive Board December 28, 1999. VIl. Outstanding information 17. The main outstanding information remaining is re-estimation of the post-construction Economic Rate of return. It is agreed that the ERR re-estimates will be done only for the subprojects financed under IDA funding and will not cover roads financed by other donors, as the task will be difficult given the limited institutional memory and poor records management among most parties involved in the project. Tanzania Integrated Roads Project Page 43 Implementation Completion Report Annex C: Borrower's Contribution and Comments to ICR THE UNITED REPUBLIC OF TANZANIA INTEGRATED ROADS PROJECT CREDIT - 2149 - TA IMPLEMENTATION COMPLETION REPORT (ICR) MINISTRY OF WORKS DECEMBER 1999 Tanzania Integrated Roads Project Page 44 Implementation Completion Report Annex C: Borrowers Contribution and Comments to ICR INTRODUCTION 1. Integrated Roads Project (Cr. 2149-TA) was effective on 15 March 1991 and closed on 30th June 1999 after a one year extension from original closing date of 30th June 1998. Until July 1994 Implementation Completion Report (ICR) was referred to as Project Completion Reports (PCR) and was spelled out in the Credits as the obligation of the Borrower to prepare the draft in accordance with the Bank's Guidelines. The Operational Policies 13.55 of April 1994 which supplements SVPOP/COD No. 8 of June 1989 provides under item 3 that the Borrower prepares and avails to the Bank its own evaluation report within six months after the CLOSING DATE on the project's execution, initial operations, cost and benefits, the Bank's and the Borrowers performance of their respective obligations under the Loan Agreement and the extent to which the purposes of the loan were achieved. Lessons learned during implementation of IRP I are valuable for future projects. 2. Prior to Integrated Roads Project there were six highways project. First highway (1964) had problems namely (i) delays and reluctance in recruiting; (ii) cultural and language problems experienced; and (iii) shortage of adequately qualified local staff. These problems persisted until the fifth highway project and were partly resolved in sixth highway project and IRP I 3. The areas which the report will concentrate on will be (i) project execution; (ii) initial operations of the project; (iii) costs of the project (IDA as well as other Donors); (iv) benefits derived from the project; (v) borrower's performance; (vi) Bank's performance; and (vii) accomplishments of the project. PROJECT EXECUTION 4. Integrated Roads Project components which were prepared during 1988 and 1989 with financial assistance from several donors, covered requirements for rehabilitating and maintaining the trunk and regional road networks, and for improving the efficiency and safety of road transportation. As stated in staff Appraisal Report dated 6 May 1990, the primary objective of the project is to restore Tanzania's trunk and regional road networks, which have become on obstacle to the sustainability of the economic recovery programme, and to develop the Ministry's institutional capacity to properly manage the networks. In particular the Project will assist the Government in developing strong management and technical capacity to maintain the trunk and regional networks, and transform the MOW from a construction oriented Ministry to an administration/contractor management oriented Ministry. The physical target was to have, by 1996, 60% of trunk roads in good condition from the current (1990) 15% and to selectively rehabilitate the regional road network in eleven of the most agricultural productive regions to have 50% of the network in those regions in good condition from the current (1990) 10% and to install regular maintenance on 80% of the trunk and 60% of the regional road networks. For the execution purposes, the project was divided in four major parts which are: (a) Institutional Support (i) strengthening MWC departments and divisions involved in contract administration, road and equipment maintenance and management, planning, budgeting and monitoring of trunk and regional roads programs, as well as policy, feasibility and engineering studies in the transport sector; (ii) instituting procedures in the REOs' in at least the eleven core regions, for administration of trunk and regional road rehabilitation and maintenance programs; Tanzania Integrated Roads Project Page 45 Implementation Completion Report Annex C: Borrowers Contribution and Comments to ICR (iii) renovation of facilities, provision of training equipment and improvement of civil engineering courses at UDSM Engineering Faculty, as well as an increase in the number of students; (iv) renovation of facilities, provision of training equipment and improvement of highway technicians courses at Arusha Technical college; (v) re-equipment MCWs Central Materials Laboratory (CML) and provision of training and technical assistance to its testing and research program, including soil testing assistance to REO; (vi) training in highway management, and road and equipment maintenance, including expansion of MCTI's facilities and training programs;' (vii) formulation and implementation of a road safety program, including vehicle weight control, and traffic management; (viii) coordination of project implementation and establishment of a management information system for the monitoring of activities at headquarters and the REOS; (ix) renovation of MWC headquarters, CML and REOS, construction of housing for REO staff, and upgrading office technology and communications; (x) revising the Government's procurement regulations, reorganizing materials supply management, and training in procurement for staff of MCW, Attorney General's Chambers and Tender Boards; (xi) continuation of assistance to domestic contractors to undertake an increasing share of road rehabilitation and maintenance works, including development of labour-based technology; and (xii) conversion of NIT's vocational training programs into more practical and shorter courses to satisfy the demand of the transportation industry. (b) Rehabilitation Program (i) rehabilitation of about 1,080 km and overlay or resealing of about 620 km of paved trunk road; rehabilitation or improving of about 2,550 km of unpaved trunk roads, and upgrading to paved road standards of about 340 km with bridges and structures; (ii) rehabilitation or replacement of about 30 other bridges, and repair of minor structures along trunk roads; (iii) improvements to about 10 vehicular ferry crossings; and rehabilitation of about 3,000 km of regional roads, principally in the core regions. (c) Maintenance program (i) acquisition of equipment, vehicles, initial stock of spare parts, and workshop items for privately operated plant pools; (ii) acquisition of equipment, vehicles, initial stock of spare parts, and workshop items for the MCW plant pool; Tanzania Integrated Roads Project Page 46 Implementation Completion Report Annex C: Borrowers Contribution and Comments to ICR (iii) acquisition of spare parts and materials for, and rehabilitation of, road maintenance equipment; (iv) equipment hire for road maintenance undertaken by the REO; and (iv) contracted road maintenance and emergency works. (d) Freight, Passenger and Air Transportation (i) strengthening ATC's management capability; and (ii) strengthening the management capability of NTC and its affiliates - RFTCOs and UDA Achievement on above components are explained under accomplishments of projects (para 22 to para 3 1). INITIAL OPERATIONS OF THE PROJECT 5. Policy objectives related to the Integrated Roads Project (IRP) were originally presented by the Government of the United Republic of Tanzania at the Transport Sector Donor's Conference at Arusha in December 1987. The policies were refined during preparation of IRP and were presented in greater detail to the consultative meeting, at Paris in December 1998. (i) In 1990, Tanzania embarked on a 10-year Integrated Roads Project, called IRP, which aims to radically transform the condition of the trunk and regional road network from one having the poorest pavement conditions in the sub-region to one which is no longer bottleneck to the country's economic development, and that can be sustainably maintained. 6. IRP I started in 1990 but since some roads spilled over from sixth Highway Project (TANZAM Sect. 2 and 4) it can be said that the initial IRP I operations started in 1987. Pre-qualification of contractors to undertake the civil works was completed by January 1987, followed by invitation to bid and planning for starting of the civil works on sections 2 and 4 of the Tanzam Highway in August 1987. 7. The rolling budget for road infrastructure maintenance for FY 1998/2000 in Tsh. is as follows: FY 98199 FY 99/00 FY 00i01 Trunk Roads 12.25bn 16.86 bn 20.07bn Rural Roads 10.0 bn 12.1 bn 16.4bn However currently total funds required for maintenance is Tsh. 60 bn per year. 8. In order to redress the issue of inadequate funds for road maintenance and to sustain benefits of operations, GOT has: (a) passed an act to ring fence Road Fund for road maintenance (90% of Road Fund) and development (10% of Road Fund) in order to redress in adequate funding for road maintenance; Tanzania Integrated Roads Project Page 47 Implementation Completion Report Annex C: Borrower's Contribution and Comments to ICR (b) is in process of establishing of TANROADS Agency in order to redress inefficiencies in institutional structure for road administration; (c) increasing technical capacity to carry out maintenance and manage contracts. COST OF THE PROJECT 9. The total original project costs was estimated as US$ 871.1 million including taxes and duties. 17 agencies contributed towards the above costs, 16 of them were Donor Agencies whereas the seventeenth was Government of Tanzania as the borrowers contribution to the project. Donors to this project are shown in Table 2. Table 1: Summary of Project cost by component COMPONENT Planned Amounts in US$ Million Local Foreign Total Institutional Support 10.6 37.8 48.4 141.8 436.3 578.1 Rehabilitation Program 22.8 46.2 69.0 Maintenance Program 1.1 41 5.2 Freight and Passenger Transport _ - Total Base Cost 176.3 524.4 700.7 19.4 59, 79.0 Physical Contingencies 23.3 68.1 91.4 Price Contingencies 4. 127.7 42.7 TOTAL COST 219.0 652.1 170.4 SOURCE Planned Amounts Actual Amounts in US $ Million US$m Local Foreign Total Total IDA 24.7 155.7 180.4 167.3 DANIDA 11.4 45.6 57.0 80.0 FRG 0.6 31.4 32.0 54.8 ITALY 0.0 91.7 91.7 54.8 FRQNMA 9.9 38.5 48.4 10.0 ODA 1.8 11.8 13.6 4.8 LTNDP 0.6 2.3 2.9 3.2 NORAD 7.4 29.1 36.5 57.5 EEC 37.5 133.5 171.0 193.7 USAID 32.3 0.4 32.7 62.0 The Netherlands 4.0 14.0 18.0 25.5 Switzerland 0.9 9.9 10.8 16.9 Ireland 1.8 3.0 4.8 4.8 AFDF 2.7 42.5 45.2 58.9 SAUDIFUND 0.0 11.8 11.8 9.9 Financing Gap 2.9 30.9 33.8 60.0* GOVERNMENT 80.5 0.0 80.5 9.3 Kuwait 0 0 0 TOTAL 219.0 652.1 871.1 868.0 * The actual GoT input is estimates. Tanzania Integrated Roads Project Page 48 Implementation Completon Report Annex C: Borrowers Contribution and Comments to ICR Total donor input to main programme is shown in table below Total Donor Input SAR estimates US$ m Final US$ m Components A. Institutional Support 54.3 104.8 B. Rehabilitation 672.0 616.6 C. Maintenance 60.2 80.0 D. Transport 5.0 6.6 Sub Total 790.6 821.1 GOT (estimated final is 80.5 60.0 a rough estimate) I Grand Total 871.1 868.0 10. Actual project cost for many donors (except for few donors like FRINMA, IDA) were above the appraisal estimates. Delays in procurement, implementation and change in priority for some donors attributed to their actual financing being below the planned Staff Appraisal estimates. BENEFITS DERIVED FROM THE PROJECT 11. There are a number of benefits which emanated from the projects. The first and foremost is the rehabilitated road sections thus reducing tremendously-the vehicle operating costs and increasing the user benefit. Journey times have been reduced by almost half of what it used to be before the rehabilitation. Products movement have been eased. The project included a road sector institutional study which resulted into a major institutional change. Establishment of TANROADS and Road Fund Board is a result of this study. 12. The basis of the Integrated Roads Project (IRP) was conceived during the implementation of Cr. 1688-TA. The study (feasibility and detail engineering) of the Chalinze- Segera - Tanga and Segera - Moshi - Arusha road was undertaken during the implementation of the same project and the outcome of these studies are clearly visible benefits to the borrower. 13. Training as conceived under the project was very successful and beneficial. The implementation capacity in the Ministry of COMWORKS was found to be inadequate hence the previous projects (Credits 507-TA and 876-TA) addressed the problem by assisting to train more engineer. Under Cr. 1688-TA another group of engineers was trained in India and the Government added another 80 graduate engineers to the country. More than twenty (20) other engineers acquired Msc degrees under the same project while more than seventy five (75) civil engineering technicians were specifically trained in highway construction and maintenance. Under IRP I, 33 staff graduated in masters of Civil Engineering degrees whereas a good number received short-term training. A significant improvement was therefore realized with respect to institutional development which enable the Ministry to fill the vacant positions identified in previous reports. 14. A strengthening of the Local contractor industry took place under IRP, and support in the form of training is being provided by donors also under IRP-U. About 50 local contractors have the capability now to carry out unpaved road rehabilitation and periodic maintenance works. Other small contractors have limited equipment holding but have the potential for labour based road maintenance works. Under W-1 most of the periodic maintenance works have been carried out by local contractors. Their performance in the Tanzania Integrated Roads Project Page 49 Implementation Completion Report Annex C: Borrowers Contribution and Comments to ICR execution of the contracts varies from fair to good, with only few that have performed poorly. Local contractors' performance has been influenced, however, by a lack of reliable road plant and equipment for hire. A steady flow of maintenance contracts from the regions is essential for the long term development of the construction industry. BORROWER'S PERFORMANCE 165. The Borrower's performance under the project has been satisfactory. There has been too many institutional restructuring within very short period such that performance of the Borrower is seen as insignificant when measured at sectoral level. The need for private sector participation in improving the economy of the country cannot be overemphasized. However, it is the speed at which the borrower would like to have realized these changes at policy level. Under this project the Borrower used a decentralized contract management system for road maintenance works, and at regional level for both routine and periodic maintenance works. 16. The policy objectives as contained in the Structural Adjustment Program (SAP) prepared in June 1982 were more realistic. For example in pursuing the road Transport Policy Paper with an aim to ensuring that rehabilitation and maintenance of the existing assets were given priority in the Transport Sector Investment Program the Borrower in December 1987 called a Transport Sector donors conference to present the paper together with another document entitled Programme for Transport Sector Recovery. In that document the Government outlined the basic policy, institutional changes and rehabilitation requirements for the sector in order to reestablish the road transport infrastructure to enable it to cater for the requirements of the economy. Furthermore the document singled out capacity building for sustainability with respect to delivery of the transport services as a critical issue to be dealt with. First steps to restore the country's essential road network by providing adequate funding and develop institutional capacity for their maintenance were taken during the implementation of this project. 17. Another major institutional reform which became an important performance indicator for the Borrower is the agreement by the Borrower to implement the recommendations of the study undertaken under the project. This study namely 'The Agricultural Feeder Roads Study' and funded by DANIDA became the pivot for the institutional changes for better performance. The Terms of Reference for the study were carefully written, and the recommendations of the study formed the basis for the 10 year rehabilitation programme with objectives to make administration and management of the road network autonomous. The achievements reported under the Integrated Roads Project are partly a result of the implementation of the study. 18. Equally the Borrower undertook the adoption of the Market Liberation Strategy during the implementation of the project encouragement of the local contractors in participating in the rehabilitation and maintenance of the road infrastructure as well as using local contractors for roadworks. Most works were done by contracting instead of the traditional force account by MOW staff. 19. In November 1998 the parliament of United Republic of Tanzania passed a Road Fund Act to ring-fence Road Fund for road activities. The Road Fund Board was inaugurate in August 1999. Chief Executive Officer for TANROADS Agency has been appointed and will be in office by January 2000. TANROADS is expected to start in July 2000 but full launching of TANROADS will be in July 2003. TANROADS will deal with implementation of road maintenance and development whereas MOW will concentrate on policy issues and strategic planning. This institutional change is expected to lead into a better road network. Tanzania Integrated Roads Project Page 50 Implementation Completion Report Annex C: Borrowees Contribution and Comments to ICR LESSONS LEARNED 20. Overall, the Borrower learned a number of lessons relevant for the future during the implementation of the project. (i) The most important lesson is the one on inadequate preparations on proper documentation and designs that it caused a lot of delay in starting and change of scope of works, hence cost overruns. (ii) Donor coordination is somehow a success on this respect hence the sound and efficient system of exchange and flow of project information, between the implementers, as well as donors. (iii) Maintenance culture and the importance of maintaining the existing infrastructure as a means of achieving a sustainable economy was also a major lesson learned. Donor dependence even for maintenance will cripple any effort to maintain the upgraded network and hence the effort to preserve investments. (iv) Frequent merger and split of MOW and MCT had some effect to project, for future programmes of similar nature, scope and size, more emphasis should be put on maintaining a stable institutional organization focusing on strengthening weak areas that would affect the output. (v) Another lesson we learn is that the project was more complex and challenging to implement due to the fact that during implementation, the country's economy was in environment of transition to market economy; the economy was experiencing imbalances and inflation, this resulted in less counterpart funding. (vi) Despite investing about US$11 million for PEHCOL the issue of equipment availability is not resolved because PEHCOL equipment bought in 1977 and 1983 are very old. For better road works activities equipment has to be made available; there is need to revisit the availability and utilization of equipment and plant in Tanzania. BANK PERFORMANCE 21. During the implementation, the Bank staff and management as a whole were very cooperative. The project was supervised by five task managers during its lifetime. Organizational changes in the Bank did not affect much the performance of the Bank on the project. Unavoidable changes of the scope of the work due to delays at the beginning and improper designs were readily attended. The most spectacular performance was the readiness of the Bank Staff in the early years of implementation, to positively agree to improvements on the scope of the project. This created a conducive Donor-Borrower relationship that should be adopted in future for implementation. Donor coordination meetings were satisfactorily held. ACCOMPLISHMENTS OF PROJECTS 22. IRP I started in 1990 and was scheduled to end in mid 1995. Due to delays in implementation of parts of the programme the closing dates for some donors like IDA was 30 June, 1999 although early closing dates were achieved for some donors. Majority of components were implemented by the end of 1995. INSTITUTIONAL SUPPORT Tanzania Integrated Roads Project Page 51 Implementation Completion Report Annex C: Borrower's Contribution and Comments to ICR 23. The target for institutional support provided under this project is to have a well functioning Organization to manage and administer the road network in Tanzania. As per SAR for IRP-1, major shortcoming which the support should help to eliminate are (i) cumbersome and inefficient structure for road administration (ii) a highly centralized and bureaucratic procurement and administrative decision making process and (iii) inadequate technical capacity to carry-out maintenance and manage contracts. Planned input was US$ 53.34m but actual total input by all donors is US$ 104.78m (96% increase). Under capacity building program, 63 MOW staff graduated with Masters of Science Degrees in Civil Engineering at various universities including UDSM. Now MOW has 331 engineers. Under this programme 374 staff participated in short term training and thus a total of 437 staff participated in short term and long term training. There has been some impact an institutional support eg. in establishment of Road Fund and TANROADS, decentralisation in procurement and contract administration and increase in technical capacity. However more support is required to have higher institutional capacity. REHABILITATION 24. The total target for upgrading and rehabilitation of paved trunk roads was 1,526km. A total of 1,454km was achieved/will be achieved, equal to 95%. Above that 500 Ian of TANZAM were to be resealed under IRP-I. This was not carried out, but most of it has been done under IRP-I1 with NORAD financing. The target comprised 17 road sections, of which 1 have been completed according to, or above, the set targets. Further two sections, Mwanza-Nyanguge (EU financed) and DSM (Wazo hill) - Bagarnoyo (Italy/EU financed) have been committed, but are only expected to be completed by year 2000. Of the four remaining sections the three have been included in IRP H. The section Lindi-Mingoyo-Mtwara has not been committed by any donor ( a short section of the road was maintained by FR4NIDA in connection with the Mingoyo-Masasi section). 25. Of the target for gravel trunk road rehabilitation of 2,546km, only 1,129km, or 44% were completed under IRP-1. Out of the 12 roads listed in the SAR five have been completed according to plan, and one, Shelui-Singida-Babati-Bereku, has been partly completed (88km out of 3 1 0 km). The remaining six roads could not be implemented due to cost overruns compared with the SAR. These have been included in IRP-H, fully or partly, and three of them are planned for upgrading to paved standard. Two roads (one contract), Tanga-Horohoro/Marangu-Tarakea which were under 6'h Highway Project, were implemented under IRP due to cost overruns of the 6d'HWP credit. Sections of five gravel trunk roads, total 159kin, received maintenance under IDA financing, which in most cases were in fact rehabilitation. The roads have been included in the achievements. 26. The target for rural gravel roads was 3,000 km and, as shown in table 6.2, 3,605 km were achieved. In addition to that 148 km of paved roads in Dar es Salaam were rehabilitated. The bilateral donor programme had a target of 1,200km. Only 489 have been completed. The donors for this programme have been FRINIDA, NORAD, the Netherlands, EU, SDC and Ireland. The SAR is not specific about which donors would contribute to the programme, and no specific commitments are mentioned in the report. 27. According to the SAR, IDA would finance rehabilitation of 30 trunk road bridges, and of 10 ferry crossings. US$ 1.93 million were budgeted for overhauls of vehicular ferries. One bridge, Kyaka bridge in Kagera district, was constructed under IRP-1, together with access roads. Kyaka bridge was a major construction, clearly outside the scope of what was intended with the bridge component, and the construction more than exhausted the Tanzania Integrated Roads Project Page 52 Implementation Completion Report Annex C: Borrowers Contribution and Comments to ICR funds budgeted. The IDA/IRP-1 1 programme contains two bridge packages for rehabilitation, listing a total of 188 bridges with a total length of 3,977 metres. MAINTENANCE 28. The road maintenance programme included in the SAR for IRP-1, was to be jointly financed by IDA and GOT. The programme includes the following main components: IRP-1 Financing, US $m Maintenance Program IDA GOT Total Road maintenance equipment 17.14 17.14 Equipment rehabilitation 4.75 4.75 Equipment hire to mid-1995 8.27 15.37 23.64 Contract maintenance to mid-1995 19.45 3.43 22.88 Emergency work 10.67 1.88 12.55 TOTAL 60.28 20.68 80.96 As mentioned above the work carried out under the components, contract maintenance and emergency work, in reality became full rehabilitation of the selected road sections and the output of the two components have been included in the achievements of rehabilitation. The main reason for this change in scope of work was that the selected roads were in such a state of repair that only full rehabilitation could bring them to the maintainable condition. The SAR does not include any physical targets for the km of roads to be maintained under the two components. It must be envisaged that it was expected to be considerably more than was actually achieved, due to the fact that the projects implemented under the two components in reality became full rehabilitation. With regard to emergency work the SAR states that priority will be given to road failures affecting movement of agricultural supplies and produce. However, the funds, were all used for rehabilitation of roads in Dar es Salaam. 29. Twenty eight (28) road project were implemented under the two components. The total costs for these roads were US$ 81.6 of which local costs were approx. US$ 32.2m of which GOT was required to pay US$ 16.1 according to the agreement. The total payment from GOT is about US$ 3 1.0m, which means that GOT has paid about US$ 15m more than its commitment. The rationale for doing so was that this would ensure more foreign funds available under the credit, and thereby more work could be carries out, as long as GOT paid the local costs. An analysis of Road Fund contributions to MOW shows the following: Tanzania Integrated Roads Project Page 53 Implementation Completion Report Annex C: Borrowees Contribution and Comments to ICR Financial Rate of IRP Govemment Actual Actual/ year exchange Target Budget Disbursement IRP target TShs.JUS$ US$m TShs.m US$m TShs.m US$m 1991/92 284.45 16.11 2,058 7.24 44.9% 1992/93 407.43 16.11 5,167 12.6 5,169 12.69 78.7% 1993/94 501.66 18.41 7,649 15.25 8,515 16.97 92.2% 1994/95 540.82 34.30 15,188 28.08 16,256 30.08 87.7% 1995/96 562.61 34.73 16,094 28.61 16,084 28.59 82.3% 1996/97 601.25 34.91 20,000 33.26 16,000 26.61 76.2% 1997/98 620.0 36.10 16,000 25.81 11,300 18.23 50.4% 1998/99 720.0 83.33* 32,250 44.79 31,777 44.13 52.9% 1999/00 780.0 76.92* 32,640 41.85 - Current funding needed for road maintenance is estimated at Tsh. 60bn. The table shows that funding of road maintenance increased steadily from FY 1991/92 to FY 1993/94, when the Government disbursed more than the approved budget of the Ministry of Works in Tanzania Shillings, but it was slightly lower that the agreed IRP maintenance target in dollar terms. In 1995/96 the government experienced a budget deficit and could not meet its obligations with regard to the road maintenance funding from the Road Fund. This budget deficit was more severe during FY 1996/97, where the government managed to disburse only 76.2 percent of the total IRP target. 30. With regard to plant and equipment, the intention of having a central pool for hire (PEHCOL) operated on commercial basis has not yet been achieved and the availability of equipment particularly for gravel roads rehabilitation and maintenance is not reliable, except in those regions that benefit from the availability of MOW road workshops. In order to ensure the sustainability of road investments, it is a prerequisite that road plants and equipment are readily available for hire at the right time. The private sector is apparently not yet prepared to invest in road plants and equipment partly due to lack of capital, and partly due to uncertainty with regard to continues availability of road works, and hence the utilization of the equipment. Donor assistance may be required to support the Government in the procurement of the initial assets of plants and equipment. The Government has decided to privatise PEHCOL and the privatisation process is ongoing. FREIGHT, PASSENGER AND AIR TRANSPORTATION 31. A total of US $ 6.58 million was provided for management assistance to ATC, assistance to NTC, RETCOs and assistance to DSM passenger transport. Overall evaluation of TA to NTC, RETCOs and UDA had a positive impact because most RETCOs performed well during supervision of TA and realized profits, UDA's operation reduced losses although it did not realize profit and skills of counterpart staff were increased. Operation of Air Tanzania Integrated Roads Project Page 54 Implementation Completion Report Annex C: Borrowers Contribution and Comments to ICR Tanzania Corporation was greatly improved during provision of TA to ATC and computers bought under the project greatly increased the performance of ATC. CONCLUSIONS 32. All in all although the project was extended once for one year and there were some cost overruns on some items for some donors the project was fairly satisfactory. The project had significant impact on transport operation. Vehicle operating costs and travelling time has reduced. Zanzibar ZIROP study has been successfully completed and a good number of staff have been trained under this project. REFERENCES 1. The World Bank - 1990 Staff Appraisal Report No. 8367-TA - The Integrated Roads Project. 2. The World Bank - 1994 Staff Appraisal Report No. 12536-TA - Second Integrated Roads Project. 3. Comprehensive Review of IRP, June 1997 Revised Third Interim Report on Status of IRP. Tanzania Integrated Roads Project Page 55 Implementation Completion Report Annex C: Borrower's Contribution and Comments to ICR Borrower's Comments on ICR (a) Borrower The Borrowers comments are overall positive. According to the Borrower, the Bank's performance was satisfactory. The supervision missions were effective, but has noted that there were frequent changes in the Bank's management of the tasks. Most of the comments highlighted issues already raised in the ICR which have been incorporated. Details of the comments are in the project file. (b) Cofinanciers. As noted in the ICR, besides IDA, 15 other donor agencies have participated in parallel financing of the Project. The ICR mission has contacted some of the agencies in Dar es Salaam. The comments received from the donors are incorporated in the ICR mission aide memoire. MAP SECTION IBRD 22067 SUIIORA / I 0 **0~~~~~~~~~~~~~U~~ ~~ Lo~~~~o v ~~KENYA K E N Y A~~~~~~~~~~~~~~~~01.PU R4otW ~~~~~~~ S tlyongo ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ TANZANIA KrN Moodud os ZAMBIA i* 0 4-~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~4 K- ~ ~~~~~HooqU yL.INTEGRATED RQADS PROJECT r.i' ~~COREREGION$, R~ A ZrasaA A ZONE WORKSHOPS FIRST YEAR PROGRAM; REHASILITATiGHNIJPGRAOE ABORA~~~~~~~~~~~~~~~~~~~~~~~~ZNIA ON-GOING PROsECTS K.g. ~ ~ ~ ~ ~ ~ ~ DD .v o . K ILN SECOND YEAR PROGRAM: Worn? - Z~~~~~NZIBA oRSHABILITATION/UPGEAIDE INGIDA Egggggp.~~~~~~~~~~~~ RESEAt/IMPROVE SHIED YEAR PROGRAM, UKWA J~~~~~~~~~~~~~~~~~~~~~ROOG S OAM - REHABIL-TATION/UPGRADE! *** RESEAL/IMPEOVE FOURTH YEAR PIIOGRAM. - COAST ~~~~~~*Ogeg REHARILITATIONIUPGRADE PAVED TRUNK ROADS SUMEAWANGANL,kl j ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~UNP'AVED TRUNK ROADE P0 1v ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~~~ynooe MAFIA - EALGD * onroo4o. 4- ~~~~PORTS A' AIRPORTS *ilo 0,01 ----- AKE SERVICES (FERRIES) m ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~0 SELECTED TOWNS * ~~~~~~orM ~ (g REGION HEADQUARTERS LI F .* S ~~~~~~~NATIONAL CAPITALS T. L ... k. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~REGION ROUNDARIES ---INTERNATIONAL BOUNDARIES Z A M 3B IS oI At.%' (ZAKB OUEg11 INDIAN~~MY 99