Document of The World Bank FOR OFFICIAL USE ONLY Report No. 8468-YAR STAFF APPRAISAL REPORT YEMEN ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT MAY 25, 1990 Infrastructure Division Country Department III Europe, Middle East and North Africa Regional Office 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 EOUIVALENT US$ 1.00 Yemeni Rials (YRls) 12.00 YR 1.00 - US$ 0.08 SDR 1.00 US$ 1.30 - As of May 1990 - MEASURES AND EQUIVALENTS 1 millimeter (mm) - 0.04 inches 1 meter (m) - 3.28 feet 1 kilometer (km) - 0.62 miles 1 hectare (ha) 2.47 acres 1 liter (1) - 0.21 gallons (Imp.) ABBREVIATIONS AND ACPONYMS CPO - Central Planning Organization EHD - Environmental Health Department ERR - Economic Rate of Return FAD - Finance and Administration Department FLCCD- Federation of Lc.zal Council for Cooperative Development GTZ - Deutsche Gesellschaft fur Technische Zusammenarbeit HCB - Housing Credit Bank HD - Housing Directorate IPA - Institute of Public Administration LCCD - Local Council for Cooperative Development MMH - Ministry of Municipalities and Housing MPW - Ministry of Public Works NPV - Net Present Value NWSA - National Water and Sewerage Authority PD - Project Department PPD - Physical Planning Department TBO - Taiz Branch Office UDHD - Urban Development and Housing Department UDPU - Urban Development Project Unit YAR - Yemen Arab Republic YGEC - Yetmen General Electricity Authority FISCAL YEAR January 1 - December 31 FOR OFFI-IAL USE ONLY YEMEN ARAB REPUBLIC IQLZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT STAFF APPRAISAL REPORT TABLE OF CONTENTS CREDIT AND PROJECT SUMKARY . . . . . . . . . . . . . . . . . . . . .(i) I. THE URBAN SECTOR .1... . . . . . . . . . . . . . . . . . . . . . . . Country Background .1... . . . . . . . . . . . . . . . . . . . . Population Growth and the Urban Sector . . . . . . . . . . . . . . 2 Government Strategy in the Urban Sector . . . . . . . . . . . . . . 2 Urban Sector Organization . . . . . . . . . . . . . . . . . . . . . 3 IDA Strategy in the Urban Sector . . . . . . . . . . . . . . . . . 4 IDA Involvement in the Urban Sector . . . . . . . . . . . . . . . . 4 Project Rationale . . . . . . . . . . . . . . . . . . . . . . . . . 5 II. THE PROJECT AREA . . . . . . . . . . . . . . . . . . . . . . . . . . 5 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Physical Setting.. ............ ...... 6 Existing Flood Protection . . . . . . . . . . . . . . . . . . . . . 6 Rainfall and Flood Characteristics . . . . . . . . . . . . . . . . 7 Major Flood Events in Taiz . . . . . . . . . . . . . . . . . . . . 7 Flood Impact . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 III. THE PROJECT .... . . . . . . . . . . . . . . . . . . . . . . . . 8 Project Origin . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Project Objectives . . . . . . . . . . . . . . . . . . . . . . . . 9 Project Alternatives .... . . . . . . . . . . . . . . . . . . . 9 Project Description . . . . . . . . . . . . . . . . . . . . . . . . 10 Status of Preparation . . . . . . . . . . . . . . . . . . . . . . . 11 Project Cost and Financing . . . . . . . . . . . . . . . . . . . . 11 Procurement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Disbursement .......................... . 14 Project Supervision .17 Monitoring System . . . . . . . . . . . . . . . . . . . . . . . . . 17 Land Acquisition . . . . . . . . . . . . . . . . . . . . . . . . . 17 IV. THE BORROWER AND IMPLEMENTING AGENCY . . . . . . . . . . . . . . . . 18 The Borrower . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Organization and Management - MMH . . . . . . . . . . . . . . . . . 18 Organization and Management - TBO . . . . . . . . . . . . . . . . . 19 Staffing and Training .19 Project Implementation and Management . . . . . . . . . . . . . . . 21 Project Accounts and Audits ...... .. . . .. . . .. . . 21 V. FINANCIAL ANALYSIS AND COST RECOVERY . . . . . . . . . . . . . . . . . 22 The Ministry of Municipalities and Housing . . . . . . . . . . . . 22 The Taiz Branch Office . . . . . . . . . . . . . . . . . . . . . . 23 Project Cost Recovery .................... . .. 24 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. Table of Contents contd. VI. PROJECT JUSTIFICATION ....................... . 26 Least Cost Alternative .... . . . . . . . . . . . . . . . . . . 26 Project Be.efits .... . . . . . . . . . . . . . . . . . . . . . 26 Economic Analysis .... . . . . . . . . . . . . . . . . . . . . . 26 Affordability and Urban Poverty ... . . . . . . . . . . . . . . . 27 Institution Building . . . . . . . . . . . . . . . . . . . . . . . 28 Environmental Impact . . . . . . . . . . . . . . . . . . . . . . . 28 Project Risks and IDA Supervision ... . . . . . . . . . . . . . . 28 Land Requirements and Resettlement ... . . . . . . . . . . . . . 28 VII. AGREEMENTS REACHED AND RECOMMENDATIONS . . . . . . . . . . . . . . . 29 ANNEXES 1. Project Scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 2. Project Cost Estimate ....................... . 33 3. Project Implementation Schedule .................. . 34 4. Project Supervision Forecast ................... . 35 5. Project Implementation Program and Monitoring Indicators. . . . . . . 36 6. Ministry of Municipalities and Housinr Organizational Chart . . . . . 38 7. Taiz Branch Office Organizational Chart . . . . . . . . . . . . . . . 39 8. MMH Employee Roster .... . . . . . . . . . . . . . . . . . . . . . 40 9. MMH - Consolidated budget/Analysis of Project Investments/ . . . . . 41 Analysis of Salaries and Wages/Analysis of Service Expenses 10. TBO Revenues and Expenditures .... . . . . . . . . . . . . . . . . 43 11. Economic Analysis ........................ . 44 12. Affordability Analysis .... . . . . . . . . . . . . . . . . . . . 49 13. Municipal Resource Mobilization Policy Implementation . . . . . . . 53 Action Plan 14. Selected Documents in the Project File . . . . . . . . . . . . . . . 54 MAPS Map No. IBRD 22142 Project Location Map Map No. IBRD 2214^ Project Area This report Is based on the findings of an appraisal mission which visited the Yemen Aab Republlc from Janwury 24 to Febmay 13. 190. Mission members Included Messrs. Mario A Zelaya (Task Mar). Robert WUdem (Fnancal Anlyat) and Roger WMs (Consutant). - i - YOM ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT CREDIT AND PROJECT SUMMARY Borrower: Yemen Arab Republic Beneficiary: Ministry of Municipalities and Housing Amount: SDR 11.7 million (US$15 million equiv.) Terms: Standard IDA terms, with 40-year maturity Project The primary objective of the proposed project is to provide Descrigtion: in the city of Taiz essential flood control works for the protection of public and private property from flood damage and reduce the risk of loss of human life. Other objectives are to implement a project cost recovery mechanism at a municipal level and to promote implementation of a national municipal resource mobilization policy, and to further strengthen institutional capabilities of both MMNI and its main branch offices. The project includ-s: (i) flood control structures consisting of open channels and box culverts, sediment and boulder traps, at various places .n Wadis Seena, Al Nassar, Madam and Al Kamet; (ii) the restoration of street pavement; the conservation of soils through the terracing of unstable slopes; surface drainage footpaths in narrow and steep streets to control erosion; and land acquisition; (iii) the purchase of equipment for the maintenance of roads and flood control structures; (iv) the institutional strengthening of MMH and its main branch offices through technical assistance; technical assistance for project management; (v) the introduction of a national municipal resource mobilization policy and implementation of project cost recovery; (vi) the hiring of consultants for the preparation of a future urban development project; and (vii) the training of MMH's and its main branch offices staff. Benefits The project will provide protection of public and private and Risks: properties against economic losses due to flood damage, and reduce the risk of loss of human life. It will yield major environmental improvements by eliminating the problems caused by sediments and municipal refuse deposited by flood waters on major street intersections. It will also provide institutional strengthening to MMH and at its branch offices. Although the project during its implementation would be exposed to a flood damage risk, provisions have been taken, in both project design and construction supervision, to minimize such a risk. Estimated Project Cost Local Foreign Total ------(US$ million)----- Clvil Works 3.52 9.62 13.14 Maintenance Equipment 0.05 0.90 0.95 Land Acquisition 0.70 - 0.70 Project Management 0.05 1.20 1.25 Technical Assistance and Training 0.05 10 1.05 Total Base Cost (May 990 prices) 4.37 12.72 17.09 Physical Contingencies 0.35 0.96 1.31 Price Contingencies 2.53 1.32 3.85 Total Project Cost 7.25 15.00 22.25 Financing Plan: Local Foreign Total ------(USs million)----- Government 7.25 - 7.25 IDA - 15.00 15.00 Total Financing 22.25 15.00 22.25 Estimated Disbursements: IDA Fiscal Year 1991 1992 1993 1994 1995 1996 1997 1998 1999 Annual 1.00/a 2.75 3.75 2.70 2.10 0.90 0.75 0.75 0.30 Cumulative 1.00 3.75 7.50 10.20 12.30 13.20 13.95 14.70 15.00 Rate of Return: 12 percent Maps: IBRD No. 22142 22143 /a Includes an initial deposit of US$1.0 million to a Special Account. YEMEN ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT STAFF APPRAISAL REPORT I. THE URBAN SECTOR Country Background 1.01 The Yemen Arab Republic (YAR), situated on the southern corner of the Arabian Peninsula, is bounded on the north and east by Saudi Arabia, on the south by the People's Democratic Republic of Yemen and on the west by the Red Sea. Local estimates give its area as approximately 200,000 square kilometers. Although it is known that such minerals as copper, iron, sulphur, zinc, silver, gold and uranium exist, no thorough studies or research have been done and none of the known minerals is being exploited with the exception of salt and oil. 1.02 Following several years of rapid economic growth and balance of payments surpluses in the early seventies, YAR economy slowed down in the late seventies and early eighties, and the macro-financial situation deteriorated sharply. The levelling-off in the flow of workers' remittances and official aid and the drought were the main causes of the economic slowdown, while the fast increase in public expenditures and the overvaluation of the local currency were the chief factors of fiscal and external imbalances. The Government started to correct those imbalances in 1983, mainly by reducing expenditures (notably investment), adjusting the exchange rate, and restricting imports. 1.03 However, considerable inflationary pressures remained in the economy, and the stabilization effort had to be strengthened. Considerable progress was made during the 1985-86 period towards reducing the fiscal and external deficits. The period 1987-89, however, witnessed a considerable relaxation of the stabilization program, largely in anticipation of oil exports which started in late 1987, and a marked deterioration occurred in the macro-financial position and in the incentive system. 1.04 While oil and gas revenues (discovered in 1984) and a continuation at present levels of traditional foreign exchange receipts could improve the country's economic prospects, the uncertainties about these key parameters and the country's great need for more and better public services call for more efficient use of oil revenues and caution in fixing growth targets and in managing the external debt. Even with correct macro-economic policies, YAR's development prospects are limited unless the Government addresses two long- term issues; namely, the increasing water scarcity (particularly around Sana'a) and the rapid urban population growth. - 2- PoDulation Growth and the Urban Sector 1.05 Urbanization in YAR is the lowest (16 percent of the total population of 9.3 million) but fastest growing throughout the Middle East. This rapid urbanization started in the early 1970s as a result of a high rate of income increase, stagnation of agriculture, and growth of Government services. 1.06 The urban population is quite widespread with a moderate concentration in the three largest cities, as the regional differentiation of economic functions has prevented the overwhelming primacy of one city. The 1986 populations of Sana'a, the capital, Taiz, the principal trading and agricultural processing center, and Hodeidah, YAR's main port, were about 430,000, 180,000 and 150,000 respectively (about 60 percent of the urban population), while the remaining 40 percent of the urban population lived in towns of less than 50,000 inhabitants. The populations of Sana'a and Taiz, on the other hand, have more than doubled over the past 5 years, growing by more than 15 percent per annum. 1.07 As personal incomes and urban population increased in the 1970s and early 1980s, so did the uncontrolled sprawl of informal (but fairly well built) housing on to urban areas. However,the provision of urban services lagged behind, despite the Government's impressive efforts. Contributing factors to th- growth in urban service deficiencies have been the absence of a formal land .-gistration system, failure to fully recover the cost of services thereby eroding the Government's capacity to finance such services, and the use of unrealistic standards unaffordable to a large segment of the population. Government Strategy in the Urban Sector 1.08 Until 1979, Government intervention in the urban sector was on an ad hoc basis with the various agencies implementing their own projects independently. In 1976, the Ministry of Public Works (MPW) initiated the preparation of master plans for the five major cities of YAR. Although these represented an appropriate framework for directing urban growth, they proposed standards inconsistent with the financial and implementation capacity of the relevant urban agencies. 1.09 Concerned with the mounting urban problems and the lack of coordination of the activities of the various ministries and agencies, the Government, in 1979, vested to the newly established Ministry of Municipalities and Housing (MMH) the responsibility for the physical planning and urban administration of the five main cities and of the secondary towns, while the Central Planning Organization (CPO) was charged ws.th ensuring that the national urban development policy would be consistent with the broader national development strategies. The Government's strategy in the urban sector, therefore, focuses on providing essential municipal infrastructure while strengthening the institutional capabilities at the central and local levels. In Taiz, however, the provision of municipal infrastructure has been hampered by the recurrent floods in the Old Taiz area; addressing this problem - 3- is the Government's priority in Taiz. 1.10 More recently, discussions have commenced between North and South Yemen for the yurpose of unifying the two countries under a single constitution. A target date of November 30, 1990 has been set for the official start of the new government, and a new ministerial structure has already been announced for that purpose. Unification, at least in the short term, is likely to have a signifJcant impact on future Government strategy for the urban sector. The outcome of this process will be monitored closely in ensuing IDA missions. Urban Sector Organization 1.11 Although short of funds as well as qualified technical, administrative, and managerial manpower, YAR has endeavoured to establish the basic institutional framework for urban development and related infrastructure services. Provision of water and sewerage, for example, is carried out by the National Water and Sewerage Authority (NWSA), electricity is provided by the Yemen General Electricity Corporation (YGEC), while inter urban road construction and maintenance works are carried out by the Highway Authority which belongs to the Ministry of Public Works (MPW). YAR also has institutions for land survey and registration, health and education services, public transport, co-operatives and popular participation, and housing finance (HCB). 1.12 Urban administration and housing development is the responsibility of MMH. The Ministry is represented at the f'overnorate level through 11 branch offices, each headed by a General Director who is appointed by the Minister but who is administratively responsible to the Governor. The branch offices remain closely controlled by, and financially and technically dependent upon, the Ministry. All capital projects and maintenance activities are centrally prepared and approved. The budgets for recurrent expenditures are prepared locally but are proposed to and approved by central level officials. 1.13 The Ministry's mandate includes the preparation of master plans and related legislation for the major cities; the creation of the requisite administrative, technical and managerial manpower for their implementation; the protection of the environment including the provision of sanitation, garbage collection and disposal services; and the provision of cultural and recreational amenities and services, such as public baths, parks and gardens, including the planting of trees. 1.14 The Ministry is also responsible for the housing of municipal workers and street cleaners (low-income groups); the naming of streets arrs numbering of houses; the expansion of housing development programs, the establishment and maintenance of markets, slaughterhouses and cemeteries; the encouragement of housing cooperatives; and, the enforcement of a rent law. - 4 - 1.15 Local Councils for Cooperative Development (LCCDs), established under Law 12 of June 14, 1985 to replace the former Local Development Associations (LDAs), operate at the local level with open ended responsibilities; often these responsibilities overlap with those of MMH, N'JSA and YGEC. LCCD's funds come from building permits and cleaning fees, both collected by MMH branch offices, and their investment programs are set in close response to perceived local needs. LCCDs are chaired by Governors and are organized nationally under a Federation of Local Councils (FLCCD). IDA Strategy in the Urban Sector 1.16 Given YAR's current difficult economic situation and the mounting pressure of its urban problems, IDA's short-term strategy in the sector is focused on well targeted project work requiring minimum and directly recoverable investment with maximum use of existing resources. This project work is aimed at enhancing IDA dialogue with the Yemeni authorities while at the same time serving as a vehicle for addressing institutional and structural weaknesses (urban infrastructure maintenance, municipal resource mobilization, land registration and housing finance), by building on the achievements already obtained from the first two ongoing urban projects (para 1.18). 1.17 This process is aimed at preparing the groundwork for broader policy oriented sectoral involvement and to set the stage for the principal element of urban development strategy for the long term, i.e., the creatien of a viable administrative system which, as it develops, will delegate more =esponsibility to the municipalities and, at the same time, maximize private initiative. In the short run, however, it is expected that tne central government will continue its policy of a highly centralized system. IDA Involvement in the Urban Sector 1.18 IDA lending for urban infrastructure started in 1974 with , credit to help the Government finance the first public water supply system in Sana'a and to strengthen NWSA which had been established in 1973. IDA involvement in the sector was broadened in 1979 when YAR requested assistarnce for an urban sector review. This review (Urban Sector Report No. 2699-YAR) identifi3d the major urban development issues and its findings formed the basis of the Sana'a Urban Development Project (Credit No. 1202-YAR) which was approved in January, 1982. This first demonstration project was aimed at assisting the Government to address the issues identified by the sector review , tackling specific shelter problems, introducing the concept of mortgage financing to low-income groups for self-help construction, while strengthening the Housing Credit Bank (HCB). 5 - 1.19 On the basis of the principles established under the Sana'a Urban Development Project, IDA approved the Second Urban Development Project (CR. 1441-YAR) in February, 1984. The second project continued along the principles established under the first one by applying the same standards ir. Hodeidah (Yemen's third largest city) while expanding MMH activities. 1.20 Overall implementation progress of the first two urban projects has been satisfactory, however, the institutional components have been implementing slower than what was originally envisaged. Although these two projects are not yet completed, the main lessons learned are that (a) considerable time should be allowed for project implementation when several government agencies are involved requiring close coordination of actions, particularly when institutional and financial systems such as housing finance, selection and qualification of beneficiaries for sale of plots and houses and revenue collection are introduced for the first time; the projects provided only four-and-a-half vears for implementation while eight years would have been more appropriate; and (b) adequate compensation should be provided to attract and retain qualified local professionals for key positions. These lessons have been taken into account in the design of the proposed project by providing eight years for project implementation and adequate compensation for key staff positions. Project Rationale 1.21 The proposed project is in full agreement with Government and IDA strategy for the urban sector as it would address a major problem of flooding in the City of Taiz, the second largest urban area in the country, financa the implementation of recoverable infrastructure investments, and ad&ress structural weaknesses at the central and local levels through technical assistance and training and policy reforms. II. THE PROJECT AREA General 2.01 Taiz is the main gate for trade with South Yemen; its proximity to both Hodeidah and Mokha, the two ports on the Red Sea, make it an important trading center. Its location within the southern highlands, the area with the highest rainfall in the country, makes the city a thriving agricultural area. Moreover, the city experienced a rapid annual rate of population growth (7.6 percent) over the inter-census period of 1975-1986. 6- Physical Setting 2.02 The project area comprises the "Old City" (Medina), an ui:a of about 100 hectares on the valley and foot hills of Jebel Sabir, 'and tne adjacent area to the north (about 80 hectares), (IBRD Map 22143). Three wadis (drainage courses) pass through the area: Wadi Seena on the western boundary, and Wadi Al Nassar and Wadi Madam i.. the central area. Wadis Al Nassar and Madam discharge into Wadi Al Kamet to the north, which, togethot with Wadi Seena, form Wadi Taiz. Surface materials comprise alluvium (s'ind and gr&vel) to varying depths in the valley and rock outcrops in the south where ground levels rise. 2.03 In general, the project area is dense, compact and encircled by remnants of an old fortress wall including the two main city gates of Bab Sheika Musa and Bab Al Kabir on the northern boundary. The main residential area of multi-story houses was built to the south on steeper slopes, while the old market place occupies the flatter alluvial land of the "Old City" at the northern edge. xisting Flood Protection 2.04. Because existing wadies are being used as roads and houses have been built in the flood plains, there is very little protection against flood hazards. For instance, the original drainage channels of Wadis Seena, Madam and Al Nassar, for the most part, are now main streets of residential neighborhoods which have sprung up over the last ten years. Furthermore, high-income housing and road construction is extending on to steep hills, thereby destabilizing the slopes and increasing soil erosion. Although attempts have been made to drain rain waters from some of the major streets by providing drainage channels, these measures are it,sufficient, and authorities often resort to using sanitary sewers to discharge water runoffs. These conditions increase the health hazards caused by floods as sewers plug up with sediment and refuse, causing sewage overflows on the streets. - 7- Rainfall and Flood Characteristics 2.05. The mean annual rainfall for Taiz is estimated at 610 mm, ranging between 417 mm and 853 mm. The rainy season extends from April to October with about 80 percent of the total annual precipitation falling during this period. A summary of daily and annual rainfall in Taiz with return periods ranging from 1:5 to 1:100 years is given in Table 2.1 below: Table 2.1: Daily and Annual Rainfall in Taiz Return Period Daily Rainfall Annual Rainfall (Years) (mm) (mm) 5 72 711 10 81 787 20 92 855 50 103 940 100 113 1000 2.06 It is the short duration storms (2 hrs) that are most dangerous, as peak flows occur during these events. Moreover, a storm event with a massive daily rainfall of 92 mm, most of which may occur over a period of two to three hours, happens on average every twenty years. The data shows that downpours of this intensity can generate a flow up to 158 cubic meters per second at the con.luence of wadis Seena and Al Kamet (Wadi Taiz), which is powerful enough to cause major flood damage. Peak flows at various wadi confluences for storms with return periods of 1:20, 1:50 and 1:100 years are given in Table 2.2 below: Table 2.2: Flood Characteristics in Taiz Radi Confluence, Peak Flows in Cubic Meters per Second (Return Periods in Years) 1:20 1:50 1:100 Al Nassar Wadi Seena 35 40 43 Seena Wadi Al Kamet 137 153 170 Madam Wadi Al Kamet 130 150 165 Taiz Wadis Seena & 158 2J0 240 Al Kamet Major Flood Events in Taiz 2.07 The existing data show that the last severe flood occurred in March 1982 when three days of consecutive rain caused widespread private and public property damage, and three people drowned. Events of this magnitude are estimated to occur once every twenty years. Floods that cause moderate - 8 - property damage and interrupt traffic for two to three hours occur five to ten times annually. During moderate flooding, sedimentary material (sand, gravel and bvulders) will accumulate to depths of up to one meter at major road intersections. Streets sustain substantial erosion, and, in many places, underground utilities (water, sewerage, electricity and telephone) are exposed to pedestrian anA vehicular traffic. Flood Imgact 2.08 Although flooding directly affects the "Old Town" and the areas immediately to the north, it also indirectly affects most of the city as most vehicular traffic passes through this section. Al Gamal Street is part of the highway system linking Taiz with Hodeidah to the west, Aden to the south and Sana'a to the north. Since the project area offers employment to people residing in other neighborhoods, and the market and adjacent commercial area are important trading centers, any disruptions in this area is of significance to the city as a whole. 2.09 A flood survey undertaken during project preparation revealed that of the 5,134 households in the project area, about 28 percent flood every year and 32 percent flood every 10 years. Also, about 280 shops flood every year. The annual loss in property damage and stock, to households and shops, is estimated at about YR 29.24 millV n (US$2.7 million). 2.10 The flooding of roads, and the depositing of sediment, boulders and refuse material, not only causes a disruption in traffic and business activities but also entails considerable expense to clean up and repair damaged infrastructure. Expenditures for clean-up and road repairs are averaging about YR 1.8 million per year for the project area but are grossly insufficient to restore street pavement given the budgetary constraints of the Taiz Branch Office (TBO). III. THE PROJECT Project Origin 3.01 The proposed project was first conceived as a result of discussions between the Director of the Taiz Branch Office of MMH and an IDA mission carrying out an urban sector study, in YAR, in February 1984. Initially, the project was to address urban upgrading problems in the "Old Town" of Taiz, develop serviced land suitable for low-cost housing in Taiz, and make improvements to urban transport in Sana'a. The project was to include funding for a major study for flood control with physical implementation being deferred to a future phase. An IDA mission visited the country in January/February 1986 and reviewed the preparatory work carried out by the Urban Development Project Unit (UDPU ) established under Credit 1202- YAR. Agreement was reached on the composition of the project, which was then included in the Third Five-Year Development Plan '1988-1992). Financing of project preparation was provided under the Second Urban Development Project (Cr. 1441-YAR), and consultants were commissioned in November, 1987 to prepare a feasibility study. 3.02 The study was completed in November, 1988 and indicated that flood control should take priority over any other type of improvement in the city. It was indicated also that any investment in upgrading the "Old Town' could be wasted in case of failure to control the flood waters from the wadis. Thus, by mutual agreement between IDA and the Government, the scope of the project was modified to give priority to flood control. Furthermore, because of the econtmic difficulties facing the country, it was agreed to divide the project into self-standing phases of construction, and, to limit implementation under the project to the most needed flood control structures. The urban upgrading components were then postponed until after the flood control works are completed. Proiect Objectives 3.03 The main objectives of the proposed project are: (a) to provide most needed flood control structures to protect private and public buildings and infrastructure, and to minimize disruptions to the local economy and reduce the risks to human life; (b) to implement a project cost recovery mechanism at a municipal level, and to promote implementation of a national municipal resource mobilization policy; (c) to strengthen the urban management capabilities to the main branch offices; and (d) to strengthen MMH's institutional capacity to address urban problems more effectively. Project Alternatives 3.04 During the course of project preparation several alternative design standards and primary drainage routes were considered. All of them follow a basic design concept incorporating drainage channels and box culverts through the built-up sections of the city, and sediment and boulder traps upstream. They also include the channelization of secondary wadis originating from Al Qahira Hill (Cairo Hill) to the south of the project area, and soil conservation measures. - 10 - 3.05 Two alternative flow parameters were considered for the design of hydraulic structures, namely, a 1:5 year frequency flood as the minimum acceptable protection, and a 1:20 year frequency flood as an economically acceptable maximum protection. The impact of floods with return periods of 1:50 and 1:100 years was also considered to develop a loss-probability analysis and identify the cost effe-tiveness and risk protection of the proposed investment. Space constraints, due to the narrowness of the streets, limited the design capacity that could be economically provided. It was concluded that a hydraulic design capacity to carry 100 percent of the 1:20 year frequency flood and about 90 percent of the flood flows with a return period of 1:50 years, would yield, within the space constraints, the least- cost alternative and the maximum possible protection against any reasonable risk to human life. Thus, flood waters caused by events exceeding the design capacity (such as events occurring with a frequency of 1:50 or 1:100 years) would be of minor or moderate impact and would pose no threat to people or property. 3.06 Several drainage routing alternatives were also studied to determine the least-cost solution. Diverting Wadi Seena by tunneling under a high ridge separating two adjacent watersheds was ruled out on economic grounds. Diverting Wadi Al Nassar into Wadi Seena was considered the only viable option as the streets along its natural drainage course are too narrow to enable construction of even the minimum hydraulic capacity option (1:5 years frequency flood) without the major demolition of historical buildings in the 'Old Town". The only feasible option for controlling Wadi Madam flood waters was to provide a box culvert along the streets following the natural drainage course of the wadi. 3.07 Finally, taking into consideration the financial constraints, the project was conceived to be implemented in phases: from essential flood control works providing the most needed protection to the maximum investment including urban upgrading which would enhance land development in the areas bordering some of these wadis. Therefore, the proposed project has been designed to provide the essential flood control works which would yield the maximum economic benefit. Future urban upgrading improvements could be carried out by MMH itself when the mobilization of local funds should become possible. Project Description 3.08 The project location and the project area are shown on maps IBRD No. 22142 and 22143, respectively. The proposed project consists of essential flood control structures which will provide protection to the Old Taiz area most severely affected by floods. A de--ailed project description is given in Annex 1 and includes: (i) the essential flood control structures consisting of open channels, box culverts, sediment and boulder traps at various places in wadis Seena, Al Nassar, Madam and Al Kamet; v 11 - (ii) the restoration of street pavement; the conservation of soils through the terracing of unstable slopes; surface drainage footpaths in narrow and steep streets to control erosion; and land acquisition; (iii) the purchase of equipment for the maintenance of roads and flood control structures; (iv) the institutional strengthening oZ MMH and its main branch offices through technical assistance; and technical assistance for project construction management; (v) the introduction of a national municipal resource mobilization policy initiated under ongoing urban projects and implementation of project cost recovery; (vi) the hiring of consultants for the preparation of a future urban development project; and (vii) the training of MMH's and its main branch offices staff. 3.09 Consultant services will be proNided to prepare a feasibility study for a future urban development project, and on the basis of such a study, to prepare a preliminary and a final design as well as tender documents and technical specifications. Status of Preoaration 3.10 A draft final design of the flood control works was completed in November 1989. The final design and tender documents are scheduled for completion in June 1990. Project Cost and Financing 3.11 The proposed project, excluding taxes and customs duties (government projects are exempt), is estimated to cost US$22.25 million equivalent (YR 267.00 million), of which US$15.00 million equivalent (YR 180.00 million) represents the foreign cost component (or about 67 percent). The estimated cost by component is summarized in table 3.1 below. A more detailed cost estimate is presented in Annex 2. - 12 - Table 3.1: Summary of Proiect Cost Estimate Proiect Comonents Local Forei Total Local Foreign Total --- -YR Million---- --- -US$ Million---- Base cost (May 1990) A.Civil Works 42.24 115.44 157.68 3.52 9.62 13.14 B.Maint. Equip. 0.60 10.80 11.40 0.05 0.90 0.95 C.Land Acquisit. 8.40 - 8.40 0.70 - 0.70 D.Proj. Management 0.60 14.40 15.00 0.05 1.20 1.25 E.Tech. Assist./Train. 0.60 12.00 12.60 0.05 1L0 1.05 Project Base Cost 52.44 152.64 205.08 4.37 12.72 17.09 F. Contingency: Physical (1OX A) 4.22 11.54 15.76 0.35 0.96 1.31 Price 30.34 15.82 46.16 2.53 1.32 3.85 Sub-Total 34.56 27.36 61.92 2.88 2.28 5.16 TOTAL PROJECT COST 87.00 180.00 267.00 7.25 15.00 22.25 3.12 Base costs are expressed in May 1990 prices. Cost estimates were prepared by consultants and revised during appraisal based on the final design, soil investigations, and a survey of construction costs undertaken during project preparation, which reflect recent tenders for similar work in the country. A 10 percent physical contingency factor has been considered for civil works. Price contingancies have been calculated on the basis of a 4.9 percent annual increase from 1990 to 1995 and a 3.7 percent annual increase thereafter for foreign costs; local costs have been assumed to increase at a rate of 20 percent annual increase from 1990 to 1992 inclusive, and 15 percent annually thereafter. The construction of the main works is programmed to be completed by December 1996 (Annex 3). 3.13 The project cost also provides for technical assistance consisting of an expatriate construction engineer to assist MMH in construction supervision And an allowance for project management including salary supplements to the Yemeni counterparts (para. 4.19); consulting services to prepare a future urban development project (para. 3.09); and technical advisors to strengthen MMH (para. 4.11-4.14). 3.14 The entire foreign exchange of the project or US$15.00 million equivalent will be financed by IDA. The local cost or US$7.25 million equivalent will be financed by the Government. - 13 - Pr2cre,MXMnt 3.15 The procurement arrangements for the project components are shown in Table 3.2 below: I1<'le 3.2: Procurement Arrangements Procurement Method la Project Comgonent ICB LCB Int.Shoy. Other Total -US$ Million------------- Civil Works: 15.70 2.40 --- --- 18.10 (10.20) (1.50) --- --- (11.70) Maintenance Equipment --- 1.00 --- 1.00 (1.00) (1.00) Land Acquisition --- --- --- 0.70 0.70 (0.00) (0.00) Project Management --- --- --- 1.35 1.35 (1.30) (1.30) Technical Assistance --- --- --- 1.10 1.10 & Training (1.00) (1.00) TOTAL 15.70 2.40 1.00 3.15 22.25 (10.20)(1.50) (1.00) (2.30) (15.00) /i Figures in parenthesis are the amounts to be financed under the IDA credit. 3.16 The project will be divided into nine civil work contract packages, five of which (representing about 86 percent of the total civil works) will be tendered following International Competitive Bidding (ICB) procedures in accordance with IDA procurement guidelines. ICB contract packages will be advertised as one tender to enable interested bidders to make offers on a slice-and-package basis, allowing them to offer discounts should they be awarded more than one slice of the package. The four civil work contract packages that will be tendered under Local Competitive Bidding (LCB) procedures acceptable to IDA, consist of small works scattered over the project area; these works will be more attractive to local contractors. All civil works contracts will be implemented over periods of less than two years from the date of opening tenders and will be on fixed price basis. Documents and awards for all contracts under ICB and the first contract under LCB will be subject to prior review by IDA. Other contracts will be subject to selective post-award reviews. One set of sample bidding documents to be used for procurement through LCB will be submitted for IDA's prior clearance. Due to limited capacity of local civil works contractors, it is anticipated that only LCB contracts would be awarded to local contractors. Consultants for IDA - 14 - financed services would be selected and appointed in accordance with the August 1981 'Guidelines for the Use of Consultants by World Bank Borrowers and by the World Bank as Executing Agency. The components to be procured under ICB and LCB are as follow: Table 3.3: Procurement Packages for Civil Works Contract Package Contract Amount (US$ million equivalent) ICL No.1 Wadi Seena (wadi 1) 5.00 No.2 Wadi Al Nassar (Wadi 2) 2.37 No. 3A Wadi Madam - Section One 4.76 No. 3B Wadi Madam - Section Two 2.14 No.4 Wadi Al Kamet Channels (Wadi 4) 1.43 Sub-Total 15.70 No.5 Repairs to Owadi St. Channel 0.20 No.6 Wadi Al Kamet Culvert/Sed.Trap 0.90 No.7 Soil Stabilization 0.60 No.8 Street Pavement Restoration 0.70 Sub-Total 2.40 3.17 Contracts for the supply of maintenance equipment costing more than US$100,000 equivalent per contract would be procured under ICB procedures; and contracts costing less than US$100,000 equivalent per contract and not more than US$1.00 million equivalent in aggregate, would be procured based on comparing at least three price quotations from at least two countries through International Shopping procedures in accordance with IDA guidelines. Documents for all contracts expected to cost more than US$100,000 would be subject to IDA's prior reviews. Disbursement 3.18 The proposed IDA credit will be disbursed against the project components as follows: - 15 - Table 3.4: Credit Disbursement Against Proiect Exnenditures Amount Percent of US$Million Expenditures Categgry Descritgion Equivale to be Financed 1. Civil Works 10.6 651 2. Equipment 1.0 100X of foreign expenditures 3. (a) Consultants' Services 1.3 1001 of foreign for project management expenditures and 901 of local expenditures (b) Consultants' service 1.0 1001 of foreign expenditure for technical assistance and 901 of local expenditure 4. Unallocated 1.1 TOTAL 15.0 3.19 Bank/IDA profiles show that disbursements for urban projects in the EMENA region extend over a period of eight years; however, in YAR the average disbursement period for all sectors is nine years. The implementation period for this project (Annex 3) is estimated at eight years (July 1990 - June 1998) based on the relative simplicity of the works and the well advanced stage of the tender documents (tendering is scheduled to start in July 1990). The credit is expected to be fully disbursed six months after project completion, hence the closing date of the proposed credit will be December 31, 1998. This disbursement schedule takes into account a 20 percent advance payment on all civil works and an initial deposit of US$1 million in a Special Account (Table 3.5). 3.20 In order to expedite disbursements, a Special Account will be opened in the Central Bank of Yemen to which IDA will make an initial deposit of US$1.0 million. The Special Account will be replenished against withdrawal applications of at least US$100.000 equivalent at monthly intervals or, as appropriate, when the undisbursed balance of the Account is equal to 50 percent or less than the amount of the initial deposit. All disbursements under the project will be made against standard documentation, except for contracts below US$ 50,000 equivalent which will be claimed under Statements of Expenditures (SOE) for which related documentation will be retained for review by IDA missions and audited by independent auditors acceptable to the Association (para.4.20 and 4.21). During negotiations, agreement was reached that a Special Account will be opened at the Central Bank of Yemen. - 16 - 3.21 A disbursement forecast is as follows: Table 3.5: Estimated Disbursement Schedule IDA F Cumulative%b 1991 lstQtr. 0 0 0 2ndQtr 0 0 0 3rdQtr. 0 0 0 4thQtr. 7 1.0 l.0/a 1992 lstQtr. 10 0.50 1.50 2ndQtr. 1S 0.75 2.25 3rdQtr. 20 0.75 3.00 4thQtr. 25 0.75 3.75 1993 lstQtr. 32 1.05 4.80 2ndQtr. 40 1.20 6.00 3rdQtr. 45 0.75 6.75 4thQtr. 50 0.75 7.50 1994 lstQtr. 55 0.75 8.25 2ndQtr. 60 0.75 9.00 3rdQtr. 64 0.60 9.60 4thQtr. 68 0.60 10.20 1995 lstQtr. 72 0.60 10.80 2ndQtr. 78 0.90 11.70 3rdQtr. 80 0.30 12.00 4thQtr. 82 0.30 12.30 1996 lstQtr. 84 0.30 12.60 2ndQtr. 86 0.30 12.90 3rdQtr. 87 0.15 13.05 4thQtr. 88 0.15 13.20 lstQtr. 89 0.15 13.35 2ndQtr. 90 0.15 13.50 3rdQtr. 92 0.30 13.80 4thQtr. 93 0.15 13.95 1998 lstQtr. 95 0.30 14.25 2ndQtr. 96 0.15 14.40 3rdQtr. 97 0.15 14.55 /thQtr. 98 0.15 14.70 1999 lstQtr. 99 0.15 14.85 2ndQtr. 100 0.15 15.00 /a Includes an initial deposit of US$1.0 million to a Special Account. /_ US$ million equivalent. - 17 - Project Supervision 3.22 Normally, two supervision missions per year of a municipal engineer, and one supervision mission per year of a financial analyst, each of 1-1/2 weeks duration, will be sufficient to supervise the project. In the first year, however, four staff-weeks of a municipal engineer will be required to review procurement aspects of the project. In the second year, _wo staff- weeks of an expert on natural disaster prevention will also be required. A detailed project supervision forecast is given in Annex 4. On the basis of this forecast and on an average cost of US$ 5,000 per staff member per mission (for combined missions), the total IDA cost of supervision missions for the project will be about US$ 130,000. Monitoring System 3.23 During negotiations, agreement was reached on the Project 'Implementation Programme and Monitoring Indicators (Annex 5). To monitor this program and other aspects of project implementation, quarters.; progress reports will be submitted to IDA. Agreement was also reached during negotiations that MMH will submit to IDA quarterly reports commencing in the last period of 1990. 3.24 During negotiations assurances were obtained that MMH will prepare, within six months following the closing date of the Credit, and slubmit to the Association a project completion report reviewing the planned objectives of the project, including costs and benefits derived, performance and contribution of all the parties associated with the project. Laud Acquisition 3.25 The project will be built within public rights-of-way. However, seven houses built within or along wadi courses will be expropriated. Three out of the seven houses to be expropriated are squatter homes built on or along wadi courses. To address the problem of relocating squatter families, the Government has proposed to house them in government owned buildings in the project area giving them home ownership rights. Regarding the remaining houses which also are within wadi courses, the Government intends to purchase them at the current market value. These houses to be acquired are not of historical value and some of them will only entail demolishing courtyard walls to provide sufficient right-of-way for the proposed flood control works. During negotiations, agreement was obtained that arrangements satisfactory to IDA on the relocation of squatter families and on the purchase of homes will be finalized by December 31, 1990. - 18 - IV. THE BORROWE AND IMPLM ING AGENCY The Borrower 4.01 The proposed Credit of SDR 11.7 million equivalent will be made to the Government of the Yemen Arab Republic. MIBH through its Housing Directorate will have prime responsibility for the implementation of all components. Organization and Management - MII 4.02 MM employs a total staff of about 3,800 people, of which about 1,200 work at headquarters while the remaining 2,600 work at the branch level. About 300 employees are graduate engineers, 330 are technical staff, and 915 are administrative personnel; the remaining 2,255 are unskilled workers such as drivers, laborers and garbage collectors (Annex 8). 4.03 At the national level, MMH is divided into six functional departments, each headed by a Director General, but grouped under two Assistant Deputy Ministers (Annex 6). The Departments of Physical Planning (PPD), Projects (PD) and Urban Development and Housing (UDHD) report to the Assistant Deputy Minister for Technical Affairs; the Departments of Slaughterhouses and Meat Markets (SMMD), Environmental Health (EHD), and Finance and Administration (FAD) report to the Assistant Deputy Minister for Finance and Administration. 4.04 The Physical Planning Department (PPD) is the central unit of the A1 'litry and is responsible for the preparation of master plans and for the I iudnce of building permits. Although it has a comparatively larger technical staff than the othar departments, there is a serious shortage of middle-level technicians in PPD; other problems also exist including a lack of up-to-date planning information (e.g., socio-economic, demographic, and geographic data), equipment and budgetary resources. The Department has yet to develop a national urban policy framework and, therefore, lacks an overall strategy for settlement planning. 4.05 The Projects or "Publfc Works" Department (PD) under the Housing Directorate is responsible for the paving and maintenance of urban roads, street lighting, and tne design and construction of central markets, public gardens and parks. It also plays a role in the construction of public baths and toilets and provides design services to other government agencies on request. 4.06 The Urban Development and Housing Department (UDHD) under the Housing Directorate is responsible for the development of goals, objectives and strategies for national urbanization &nd housing programs. Its mandate includes the collection and collating of planning information and data with a view to determining the prospective resources that could be mobilized for both urban development and housing initiatives. UDHD is also responsible for - 19 - implementing the two earlier IDA financed projects and will be responsible for implementing the proposed project. 4.07 The Environmental Health Department (EHD) is responsible for urban environmental management throughout the country, although its activities are primarily restricted to garbage collection and disposal. Only the cities of Sana'a, Taiz, Hodeida and Dhamar have regular collection service. Tke- Department also functions as the Secretariat of the National Environmental Council. EHD, with the assistance of an environmental expert financed under a grant provided by the Government of the Netherlands, is developing a national environmental policy. The Slaughterhouses and Meat Market Department (SMMD) is responsible for all publicly-owned abattoirs and meat markets, while the Finance and Administration Department (FAD) is responsible for all accounting and personnel matters. Organization and Management - TBO 4.08 BO is the local operating arm of the Ministry for both the city of Taiz and the surrounding smaller cities and rural areas in the Taiz Governorate. TBO is divided into two functional units--Administration and Finance and Municipal Operations--each headed by a Director reporting to the General Director (see Annex 7 for the organizational chart). 4.09 The Administration and Finance Unit is further divided inco three divisions; accounting, personnel and commercial activities. The Accounting Division is headed by a chief accountant supported by four assistants, while the Personnel Division is headed by a chief personnel officer supported by five assistants. The Commercial Division, comprising one person, is responsible for issuing commercial permits and all revenue collection. 4.10 The Municipal Services Unit is divided into four Divisions -- Technical, Solid Waste Management, Environment, and Security. The Technical Division has sections for planning, projects, building permits, inspection, utilities, and survey. The Solid Waste Management Division, established in 1981 with the assistance of the Government of the Netherlands, is divided into four main sections: administration, stores, collection and workshop. The collection section is subdivided into seven work groups, each haaded by an inspector/foreman and wit}. about 25-35 cleaners. About 100 tons of refuse are collected and disposed of daily. The Environment Division is staffed with six health inspectors responsible for inspecting shops, restaurants and street cleaning; they also coordinate their activities with health centers. The Security Division is staffed with eight police officers and is primarily responsible for enforcing municipal regulations. Staffing and Training 4.11 At the natioral level, the Physical Planning Degartment (which forms the core of ministerial activities), is in need of specialized training to enhance its effecLiveness. In this connection, the Ministry has received a technical assistance grant from the Government of the Federal Republic of Germany through Deutsche Gesellschaft fur Technische Zusammenarbeit (GTZ). - 20 - The grant is financing a team of German experts who are in residence at the Ministry and whose function is to strengthen its physical planning capacity. While the initiative has met thus far with mixed success, GTZ intends to continue its program for at least another two years. The physical plans being developed, however, lack a focus on aspects related to preventing and mitigating natural disasters (such as floods and landslides) through appropriate urban development and planning policies. To strengthen this program, IDA will finance an advisor to the Physical Planning Department on natural disaster mitigation and early warning systems (Arnaex 6), who will (a) review and improve the physical plans and urban development policies for the major urban centers; (b) recommend necessary early warning systems; and (c) assist MMH in establishing and organizing a Disaster Preparedness and Relief Unit to coordinate MMH's activities with those of the National Committee for Natural Disaster Mitigation and Emergency Relief (NCNDMER), as well as with those of other ministries. 4.12 In terms of both operational and policy making capability, the effectiveness of the Urban Development and Housing Department (UDHD) of the Housing Directorate has been mixed. Since its inception, it has concentrated almost exclusively on implementing the first two IDA-financed urban projects; few initiatives have been undertaken on broader policy matters. The growing population and the rapid rate of urbanization are becoming pressing problems that require immediate attention. The scattered and isolated settlements must be linked with the urban areas to provide them with basic infrastructure and services. Above all, it is necessary to establish the appropriate training programs in order to develop the needed manpower so that the municipalities can discharge their mandates more efficiently. IDA will finance technical assistance on housing and urban development policy, to formulate and assist in the implementation of the above programs (Annex 6). 4.13 There is a need to develop a design and a materials testing and research sections within the Pro3ects Department (PD) this could also be enhanced by strengthening the field survey capabilty. IDA will finance technical assistance of a pu]Lic works engineering advisor for strengthening this capability (Annex 6). 4.14 At the MuniciRal Brpch Offi__e level, operational management practices are in need of strengthening, especially in view of the rapid population growth of the three main cities and the increasing demand for urban services. In this connection, the proposed project will finance technical assistance, comprising municipal engineering and urban planning to assist the PD in improving urban service delivery capability. The technical experts will focus their efforts of its branch offices on Sana'a, Taiz and Hodeidah, and the improvements they will develop ultimately could be replicated on a national basis. 4.15 During negotiations, agreement was reached on the selection and hiring of the technical assistance advisors in accordance with the Project Implementation Program (Annex 5). Terms of reference for technical assistance are available in the project file (Annex 14). - 21 - Project Implementation and Management 4.16 At the central level, overall project management will be handled by the Urban Development and Housing Department (Annex 6). In order to provide the requisite expertise in procurement and implementation matters, and to assist the Department on strengthening its urban development capabilities of expatriate assistance will be financed by the proposed project. The role of the expatriate expert will be that of an advisor, and the emphasis will be on training the Yemeni counterparts in overall project management and urban development. 4.17 A construction supervision team will be established in Taiz, but will report to the Urban Development and Housing Department at Ministry headquarters (para. 4.16). The team will comprise a Project Manager (Yemeni engineer) assisted by an advisor (expatriate construction engineer) with "hands on' experience in drainage and flood control construction activities (para. 4.19). Under this arrangement, two Deputy Project Managers (Yemeni engineers) will also be appointed. These Yemeni enginteers have been actively involved in the project design and are well qualified to undertake this responsibility. 4.18 In order to ensure that the project is not delayed due to lack of counterpart funds, t1,e Borrower, by October 30 of each year will furnish IDA MMH's proposed budgetary allocations for carrying out the annual work programs, and by December 31 of each year, furnish IDA approved budgets for the implementation of the proposed project. 4.19 Project management consisting of an expatriate construction engineer, project management expenditures and salary supplements to the Yemeni counterparts will be financed by the project.V By the time construction activity peaks, there will be an additional 12 field inspectors whose salaries and living costs will be financed from the Ministry budget. During negotiations, agreement was reached on the appointment of the construction management staff by December 31, 1990. Project Accounts am' Audits 4.20 Accounting standards within MMH are not suited to the financial monitoring of projects. To remedy this, MMH has kept separate accounts of all project-related financial transactions for IDA financed projects. These accounts are kept in accordance with generally accepted accounting principles. The personnel working in the accounting unit are competent. The project accounts will also include all operations related to the proposed Special Account (para. 3.20). During negotiations, agreement was reached, that MMH g For purposes of salary supplements, the following positions are considered eligible: a project manager and a deputy project manager at headquarters, and a field project manager and two field deputy project managers, an accountant and independent auditors. - 22 - will continue to keep separate project accounts, including all operations related to the Special Account. 4.21 During negotiations, agreement was also reached that the project accounts will continue to be audited annually by an independent auditor satisfactory to IDA, and that the project accounts inclutding the auditor's opinion will be submitted to IDA not later than nine moalths after the close of each fiscal year. Funds have been provided in the project to finance the cost of such audits. V. FINANCIAL ANALYSIS AND COST RECOVERY The Ministry of Municipalities and Housing 5.01 All capital projects, including maintenance activities, are centrally prepared and approved. While the budgets for recurrent expenditures are prepared locally, they too are approved at the central level. As shown in Table 5.1 below (an extract from Annex 9), during the past two years total budget expenditures of the Ministry almost doubled, increasing from YR 223 million in 1987 to YR 437 million in 1989. Of these amounts, salaries and wages and project expenditures accounted for 36 percent and 47 percent, respectively, of total expenditures, leaving only 17 percent of budgetary resources for administration, operations and maintenance. - 23 - Table 5.1: Yemen Alab Republic Ministry of Municigalities and Housing Consolidated Budmet (000's) Budget Estimates Actual 1Q 18 18 1987 - __-----YR 000's -----^ Recurrent Expenditures: Salaries and Wages 193,737 157,032 131,978 71,517 Service Expenses 92.84 76.112 81.943 32.631 286,621 233,144 213,921 104,148 Transfer Expenditures: Compensation Payments 201 201 197 64 Capital Expenditures: Project Investments 249.100 2Q4,.Q00 140.751 119.149 535,922 437,345 354,869 223,361 Note: Years end December 31. The Taiz Branch Office 5.02 TBO (as is the case with all branch offices) is empowered to raise revenue through a variety of mechanisms, notably permits, licenses, fines, penalties and the rental of publ'.cly-owned buildings. As shown in Table 5.2 below (an extract from Annex 10), these revenues increased by an average of about 10 percent, from YR 10.5 million in 1987 to YR 11.4 million in 1989. However, recurrent expenditures increased even faster, rising from YR 9.2 million in 1987 to YR 21.8 million in 1989. Thus, from a budget surplus of YR 1.4 million in 1987, the situation quickly deteriorated to a budget deficit of YR 10.4 million by 1989. The cause of the budget deficit can be largely attributed to rapidly escalating payroll costs. There is clearly an urgent need to improving the efficiency of operations and to increase resource mobilization at the local level. - 24 - Table 5.2: Yemen Arab Republic Taiz Revenues and Expenditures (000's) 1987 1988 1989 Revenues 10.59 11.46 11.42 Expenditures 9.22 1L.81 21.83 Surplus (Deficit) 1.37 t7.35) (10Q41) Ngt_: Years end December 31. Project Cost Recovery 5.03 Given the financial constraints at the macro level, it was agreed during appraisal that the proposed project will comprise only the essential investments--all others will be deferred until additional resources become available. Based on this agreement, the total project costs, comprising essential flood control works, expropriation costs, maintenance equipment, project administration, technical assistance and training, is estimated at YR 267.0 million, including all contingencies. It is this amount which will be recovered (Annex 12). 5.04 It was also agreed during appraisal that actual cost recovery will commence in January 1996 after most of the investments are implemented. It was further agreed that for the purpose of matching average monthly payments against generally accepted affordability criteria, a 20-year payback period was considered appropriate. In view of the opportunity cost associated with the project, it was agreed that at least part of this cost will be recovered through a 10 percent carrying charge. 5.05 Based on the foregoing, the total aggregate monthly pay back amount, for the project as a whole, is estimated at YR 2.71 million (para 6 of Annex 12). It is noteworthy that a 30-year pay back period was also considered but was discounted because the average monthly pay back would be reduced by only 10 percent, thus resulting in no significant positive impact on affordability. 5.06 An analysis was also undertaken to measure the impact on the monthly charges if costs were recovered on a citywide basis rather than on a project area basis. The number of beneficiaries by category is shown in Table 5.3 below. - 25 - Table 5.3: Yemen Arab Republic Project Beneficiaries Number of Beneficiaries Proiect Area Citide Number of Households 5,134 26,235 Shops 500 8,119 Workshops 30 898 Industries . 8 Total Beneficiaries 5,665 35.260 5.07 On a pre4oct area basis, and assuming that all costs would be recovered equally from each beneficiary within the project area, the average monthly charge would be YR 477 per month. This figure would drop to YR 77 per month if costs are recovered on a citywide basis, thus demonstrating that the project is affordable only if the larger beneficiary base is used (para. 9 of Annex 12). 5.08 Moreover, the foregoing has been computed on the basis of a flat rate tariff. Such a mechanism does not take into account the income disparities between various households. A much preferred methodology is a differential pricing mechanism, where the higher income groups and the commercial and industrial users pay a higher proportion of the costs. The difficulty in differential pricing, however, is to find an administratively simple way of determining the real capacity to pay of each household. A widely used mechanism is to accept the average electricity bill for each of the above categories (which is highly income elastic) as a proxy for determining real capacity to pay. This mechanism was discussed during appraisal and an agreement in principle was obtained from MMH. 5.09 The above-mentioned agreements with MMH on a project cost recovery mechanism were approved by the Cabinet as confirmed by a telex from CPO dated February 28, 1990. However, confirmation was obtained during negotiations on the following project cost recovery mechanism: (i) the total project cost will be recovered over a 20-year period at an annual interest rate of 10 percent; (ii) a differential pricing mechanism satisfactory to IDA, will be introduced by January 1, 1996 to recover the project cost and that the city as a whole be used as the basis for this cost recovery; and (iii) the billing and collection mechanism will be as recommended under the ongoing municipal resource mobilization study (para. 5.10). 5.10 A national municipal resource mobilization study being carried out by consultants (IPA) under Credit 1441-YAR is scheduled for completion in September 1990; on the basis of this study, MMH will draft a national policy for municipal resource mobilization. During project appraisal, MMH agreed to an Action Plan for the drafting and implementation of such a policy (Annex - 26 - 13). Agreement was obtained during negotiations that (a) by May 31, 1991 MH will submit for IDA's review a draft of such a policy which should include a billing and collection mechanism; (b) by January 31, 1992, MMH will seek Cabinet's approval of such a policy; and (c) by September 30, 1992 MMH will seek Parliament's approval of such a policy. VI. PROJECT JUSTIFICATION Least Cost Alternative 6.01 The proposed project is the least-cost solution in terms of yielding maximum benefits and yet providing adequate safeguards for the protection of both human life and property (para.3.04-3.07, 6.03-6.04). Prolect Benefits 6.02 The main benefits attributed to the proposed project relate largely to the removal of the risk of flood related losses on: (a) damages to public and private buildings, missing building contents, and damaged vehicles; (b) damages to public infrastructure such as roads, water and sewerage, electricity and telephone; (c) disruptions to traffic and business; (d) expenditures for removing alluvial material and garbage from streets; and (e) human life. Other benefits include land reclamation and road access improvements along wadis. Benefits that could not be quantified include a lower incidence of personal accidents during floods; the avoidance of fractured and obstructed sewers causing nuisance and health hazards; and the avoidance of interrupting access to the main hospital. The annual economic benefits are estimated at about YR 32.8 million (or about US$2.7 million equivalent); property damage is the single largest benefit item representing about 80 percent of all benefits. Ecgnoqig Analysis 6.03 A summary of project costs and benefits arising from the proposed project is given in Annex 11. Project costs include the investment (in constant prices) of YR 205.0 million (implemented over a period of eight years starting in 1991) plus an annual recurrent cost of YR 0.4 million starting in 1999 for a period of 37 years (through 2035). Project benefits (in constant prices) were estimated based on the avoidance of flood related damages and land enhancement arising from the proposed drainage improvements (para. 6.02). These flood related dAmages were estimated by the consultant based on a survey conducted during project preparation which provided the necessary information on losses to the private sector (transport, property and stock damage) and to the public sector (infrastructure repairs and cleanup costs). About 90 percent of the benefits were assumed to commence in 1997 when most of the flood control works would be completed. The present value of costs and benefits, based on a 45-year project life (1991-2035) and a 10 percent annual discount rate (which is considered the opportunity cost of capital), are - 27 - estimated at YR 153.9 million and YR 184.4 million respectively. A net present value is thus estimated at YR 30.5 million; the benefit/cost ratio is estimated at 1.20. 6.04 The economic rate of return (ERR), based on a project life of 45 years, is estimated at 12 percent. A sensitivity analysis for various cost and benefit zcenarios gives the following results: (i) a 0 percent increase in cost and a 20 percent decrease in benefits yields an ERR of 10 percent; (ii) a 10 percent increase in cost and a 0 percent decrease in benefits yields an ERR of 11 percent; and (iii) a 10 percent increase in cost and a 20 percent decrease in benefits yields an ERR of 9 percent. 6.05 An analysis of switching values, based on a 10 percent annual discount rate, shows that a zero net present value is obtained when costs increase by 20 percent, or when benefits decrease by 20 percent, or when property damage (the single largest benefit item) decreases by '2 percent. Affordability and Urban Poverty 6.06 Two scenarios of affordability were analyzed, namely, recovering the cost (i) on a citywide basis; and (Li) on a project area basis (para.5.06). The monthly charges for each beneficiary were estimated at about YR 77 citywide, and YR 477 in the project area, respectively (para.5.07). Based on the minimum household income of YR 3000 per month, which is considered the poverty threshold, the cost recovery charges for each of these two scenarios would represent about 2.6 percent and 15.9 percent of the minimum household income, respectively. This analysis shows that cost recovery is affordable only if implemented on a citywide basis. Furthermore, if differential price mechanism were used, the average monthly charge per household would be about YR 45, while low income households would pay as low as YR 20 monthly, or less than one percent of the minimum household income, which is affordable (Annex 12). 6.07 The affordability survey conducted by the consultant during project preparation shows that of the 5,134 households in the project area, about 15 percent or 770 households are living below the poverty threshold, and an equal number of families are also considered to be of low income, i.e. within a 10% range of the poverty threshold. Furthermore, the souk (market place), which is a beehive of commercial activity and an important tourist attraction, provides substantial employment to low income families and may be their sole source of income. These households and small-scale businesses are generally the most affected by floods and often suffer considerable economic losses through property damage and missing stock. The proposed project would provide protection against floods in this area, thus greatly reducing such losses. - 28 - Institution Building 6.08 The proposed project will strengthen the institutional capability of MMH and its main branch offices through the provision of technical assistance and training. The technical assistance to PD, PPD and UDHD on municipal public works, urban development and housing policy, will pr-avide MMH with the necessary technical capability on design and the development of standards and policies for nationwide use. Also, the technical assistance on municipal engineering and olanning will strengthen the local municipal branch offices and enhance their effectiveness by introducing a professional discipline in city management. Sana'a, Taiz and Hodeidah will be the first experimental program; any institutional gains made there could then be replicated in the remaining cities. Environmental Impact 6.09 The proposed project will yield major environmental improvements by collecting refuse material, sand, gravel and boulders in sediment traps. City streets will be cleaner and more sanitary; sewage overflows will be avoided; damage to private and public property will be mitigated; and the risk of loss of human life will be greatly reduced (para.3.05). The project will also provide assistance to MMH for addressing natural disaster prevention (including provision of early warning systems) through appropriate planning and development policies (para. 4.11). No historical buildings will be affected by the proposed project (para. 3.25). Project Risks and IDA Supervision 6.10 Two types of construction risks are foreseen, one related to the normal construction of civil works and the other associated with floods that could damage structures under construction and further aggravate the dangers normally posed by such calamities. Both types of risks, however, will be minimized through strict construction requirements included in the tender specifications, and by qualified supervision. The flood control structures have been designed with temporary provisions for use during construction. Two IDA supervision missions per year will be scheduled to ensure that the project implementation proceeds on schedule, and that qualified construction supervision is provided. Land Requirements and Resettlement 6.11 The project will be built in public rights-of-way. However, seven houses located on or along wadis will be expropriated to provide rights-of- way for some sections of the proposed project. Three of these houses are squatter homes of poor construction. The Government will relocate these families in government owned buildings in the Old Taiz area; they will be provided with 29 - property titles. The remaining houses will be purchased by the Government at market prices (para. 3.25). No resettlement of affected populations will be required. VII. AGREEMENTS REACHED AND RECOMENDATIONS 7.01 During negotiations, agreement was reached with the Government on: (i) the opening of a Special Account at the Central Bank of Yemen (para 3.20); (ii) the Project Implementation Program (para. 3.23); the submission of quarterly progress reports (para. 3.23); and the submission of a project completion report six months after project completion (para 3.24); (iii) the acquisition of land and the relocation of families in a manner satisfactory to IDA (para 3.25); (iv) the selection and hiring of technical advisors (para 4.15); the submittal to IDA by October 30 of each year MMH's proposed budgetary allocations for the project (para. 4.18); and the appointment of the project implementation and management staff (para 4.19); (v) the continuation of separate project,accounts (para. 4.20); and the submission of annual audits of,project accounts to IDA not later than nine months after the close of each fiscal year (para 4.27); (vi) the implementation of project cost recovery (para. 5.09); and (vii) the implementation of a national policy for municipal resource mobilization (para 5.10). 7.02 Agreement having been reached on the issues referred to in chapter III through V of this report and summarized in para 7.01 above, the proposed project is suitable for an IDA credit of SDRs 11.7 million equivalent to the Government of YAR under standard IDA terms with a 40-year maturity including a 10-year grace period. - 30 - Annex I Page 1 of 3 YEMEL ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PRQJECT PROJECT SCOPE 1. The project scope of work will be limited to the essential flood control structures in the 'Old City' and adjacent area to teie north; the provision of maintenance equipment; the project administration; the acquisition of land; and the technical assistance and training. A detailed description of the project components is given below. First Stage Flood Control Works 2. The flood control works include: (i) Wadi Seena (wadi 1) Improvements: (a) an open channel along Wadi Seena from the confluence with Wadi Al Kamet (wadi 4), for a distance of about 260 meters, including two box culverts at street crossings; (b) improvements to the box culvert at Jamal street crossing; (c) repairs to the existing open channel on Owadi street; (d) a box culvert at 26th September street crossing and an open channel from this intersection to about the Southern Ring Road (excluding a section from station 1246 to station 1662), including box culverts at street crossings; a drop structure and a sediment trap near the Southern Ring Road; and street pavement and repairs; (ii) Wadi Al Nassar (wadi 2) diversion works: (a) a box culvert to divert wadi 2 into wadi 1; an open channel and a sediment trap at the upper reaches of this wadi; surface drainage footpaths and street pavement; (iii) Wadi Madam (wadi 3) improvements: (a) a box culvert from the confluence of this wadi with wadi 4 to a sediment trap at the upstream end of this wadi; relocation of existing utilities; - 31 - Anney, I Page 2 of 3 (b) a sediment trap and an open channel with box culverts at street crossings at the upstream end of this wadi; and box culverts along its branches A through F; (c) repaving existing streets; and footpaths used as surface drainage; (iv) Wadi Al Kamet (wadi 4) and Wadi Taiz extension: (a) an open channel on Wadi Taiz (wadi 4 extension) from the Tahrir Street crossing to the confluence of Wadi Al Kamet with Wadi Seena; an open channel along Wadi Al Kamet from the confluence of Wadi Seena and Wadi Taiz to Tahrir Street crossing, including a box culvert at such a crossing; (b) a box culvert at the Snuthern Ring Road, including a sediment trap and a drop structure south of this crossing; and resurfacing of streets affected by the proposed works; (v) Stabilization of Slopes: (a) terracing of hill sides at three locations; and (vi) Land Acguisition: Seven houses will be ex:ropriated. Maintenance Equipment 3. The maintenance equipment for the flood control works would include the following units: l-Diesel truck tractor 1-D65 bulldozer 1-Hydraulic excavator 2-Diesel dump trucks 19.2 tons each 2-Diesel dump trucks 12 tons each 1-Front end loader (WA420) 1-Front end loaders (WAl80) 1-Pick-up truck 1600cc 1-Mobile air compressor 1-Jack hammer 1-Mobile 40Kw diesel electric generator. Technical Asaistance and Training 4. Seventy eight man-months of technical assistance will be provided. Terms-of-reference for the technical advisors are available in the project file. The advisors providing technical assistance will also be responsible for providing on-the-job training. The following advisors will be included in the project: -32 - Annex I Page 3 of 3 (i) 12 man-months of an expatriate advisor to the Physical Planning Deuartment (PPD) on natural disaster mitigation and early warning systems; (ii) 24 man-months of expatriate advisors to the Urban Development and Housing De2artment (UDHD) to assist in developing urban development and housing policies; (iii) 18 man-months of an expatriate advisor to the Projects Departmept (PD) to assist in establishing a section on public works design an material testing and research; (iv) 24 man-months of an expatriate advisor on municipal engineering to the Projects Department (PD) to assist in strengthening the Municipal Branch Offices to: (a) improve engineering and planning practices; (b) develop an inventory of municipal infrastructure and corresponding maintenance programs and budgets; and (c) provide on-the-job-training to technical staff. Proiect Implementation Manaaement 5. Project administration will consist of a central project management office at the Urban Development and Housing Department, supported by a field office in Taiz (see chapter IV of the SAR). Technical assistance includes : (a) 24 man-months of an expatriate advisor to assist the central project management office in project management and urban development; and (b) 72 man-months of an expatriate advisor will be provided to assist the field office on the day-to- day management of construction supervision. The advisors will also provide on- the-job training on construction management to Yemeni engineers. The project will also finance adequate compensation to Yemeni counterpart engineers, an accountant and independent auditors. Consultant Services 6. Consultant services will be provided to prepare a feasibility study for a future urban development project, and on the basis of such a study, to prepare a preliminary and a final design as well as tender documents and technical specifications. 46 man-months of consulting services have been provided. - 33 - Annex 2 EN ARAB REPULIC TAIX PLOOD DISASTER PREVENTION AND HUNICIPAL DEVELOPMENT PROJECT PROJECT COST ESTIMATE Project Components Local Foreign Total LocaI Foreig Total -.-.-YR Million---- ---- -US$ Million---- A. Civil Works: (Base cost at April 1990) ICB Contracts: (1) Wadi 1 9.84 33.84 43.68 0.82 2.82 3.64 (2) Wadi 2 4.68 15.96 20.64 0.39 1.33 1 72 (3) Wadi 3 - (3A) 9.36 32.16 41.52 0.78 2.68 3.46 - (3B) 4.32 14.28 18.60 0.36 1.19 1.55 (4) Wadi 4 Channels 2.88 9.60 12.48 Q.0.24 QJ08 1.04 Sub-Total ICB Contr. 31.08 105.84 136.92 2.59 8.82 11.41 LCB Contracts: (5) Repair Channel 1.08 1.20 2.28 0.09 0.10 0.19 (6) Wadi 4 Culvert 2.04 5.40 7.44 0.17 0.45 0.62 (7) Slopes Stabilizat. 4.44 0.60 5.04 0.37 0.05 0.42 (8) Pavement Restorat. 3L60 2.40 6.00 0.30 2.20 0.50 Sub-Total LCB Contr. 11.16 9.60 20.76 0.93 0.80 1.73 Sub-Total Civil Works 42.24 115.44 157.68 3.52 9.62 13.14 B. Maint. Equipment 0.60 10.80 11.40 0.05 0.90 0.95 C. Land Acquisit. 8.40 - 8.40 0.70 - 0.70 D. Proj. Manage. 0.60 14.40 15.00 0.05 1.20 1.25 E. Tech. Assist./Train. Q.60 12.00 12.60 0.05 1.QQ 1.05 Sub-Total Proj. Base 52.44 152.64 205.08 4.37 12.72 17.09 F. Contingency: Physical (10% A) 4.22 11.54 15.76 0.35 0.96 1.31 Price 30.34 15.82 46.16 2..U 1.32 3. Sub-Total Contingency 34.56 27.36 61.92 2.88 2.28 5.16 TOTAL PROJECT COST 87.00 180.00 267.00 7.25 15.00 22.25 - 34 - YMN ARAB REPUBLC TAZ FLOOD DISASTER PREVENTION AND UNICXA DEVRLOPXENT PROJMCT PROJJCT IMPLEMENTATION SCHEAUD Project Components Implementation Schedule A _Civil Works: 1990 1991 1992 1993 1994 1995 1996 1997 1998 A.Ci.vil Works: _1----- _ _ - ICB Contracts No.1 Wadi 1 - No.2 Wadi 2 No.3A & 3B Wadi 3 = - No.4 Wadi 4 OC - LCB Contracts No.5 Chan.Repair *== No.6 Wadi 4 BC No.7 Slope Stab. No.8 Pav. Rest. B. Equipment No.9 Maint.Equip * C.Land Acquisition D.Project Managem. Central office (a) * Field Office (b) *SS- Yemeni counterpart E.Tech.Assist. UDHD (c) PPD (d) PD (e) PD (f) F. Consultant Future Urban Dev. Proj. Feas. Study Prel. Design Final Design _lAd = Senderin Contract Avrdlelection 6 Appoint Cosult/Advico - 13plm"tatincu/UpplY of Equipment _REbmder services CC - Open C2urnnel SC - Box Culvert a) Advtisor on proJet manSement and Urban Dwelopnent; b) Adtvisor an coustruetion supervision; e) Advisor an Urban Development and Housing Policy; 4) Advisor on Natural DiLaster Mitigation and early warning systems; e) Advisor on Public Works Er-tneerine; f) Advisor on Munlcipal Entsinering and Urban Planning. - 35 - Annex 4 YEMEN ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT PROJECT SUPERVISION FORECAST IDA Fiscal Year Staff SRecialty Staff Weeks 1991 Municipal Engineer 4 Financial Analyst 2 1992 Municipal Engineer 3 Financial Analyst 2 Natural Disaster Spec. 2 1993 Municipal Engineer 3 Financial Analyst 2 1994 Municipal Engineer 3 Financial Analyst 2 1995 Municipal Engineer 3 Financial Analyst 2 1996 Municipal Engineer 3 Financial Analyst 2 1997 Municipal Enginee~r 3 Financial Analyst 2 1998 Municipal Engineer 3 Financial Analyst 2 1999 Municipal Engineer 2 Financial Analyst 2 -36 - Page 1 of 2 YEMEN ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTIONAND MUNICIPAL DEVELOPM -tPROJ=C PROJECT IMPLEMENTATION PROGRAM AND MONITORING INDICATORS A. PROJECT IMPLEMENTATION PROGRAM Target Responsible Reference Action Date Authority bra, 1. Provide IDA with a copy of 10/30/90 MMH 4.18 annual work program and budgetary allocations for the project. 2. Provide IDA with a copy of 12/31/90 MMH 4.18 approved budgetary allocations for the project 3. Appoint an advisor to the 12/31/90 MMH 4.16 Urban Development Depart. 4. Appoint municipal eng. 12/31/90 MMH 4.14 to assist MMH in strengthen- ing its branch offices 5. Acquire land and relocate 12/31/90 MMH 3.25 families. 6. Submit to IDA the first 12/31/90 MMH 3.23 quarterly progress report. 7. Appoint construction 12/31/90 MMH 4.17 engineer advisor and Yemeni Counterpart 8. Open a Special Account 02/14/91 MMH 3.20 9. Submit to IDA a draft national 05/31/91 MMH 5.10 policy for municipal resource mobilization. 10. Appoint a consultant to prepare 06/30/91 MMH 3.09 a future urban devel. project. - 37- Annex 5 Page 2 of 2 YEMEN ARnB REPUBLIC TAIZ FLOOD DISASTER EVENTIONAND NUNICIPAL DEVNELOPKENT PROJECT PROJECT IPLELMTATION PROGRAM AND MONIXTORING IDICATORS Target Responsible Reference Action Date Authority Para. 11. Appoint advisors to the 09/30/91 MMH 4.12 Housing Directorate 12. Appoint public works advisor 12/31/91 MMH 4.13 to the Projects Department. 13. Appoint an advisor on 12/31/91 MMH 4.11 mitigation of natural disaster and early warning systems. 14. Seek Cabinet's approval 01/31/92 MMH 5.10 of Municipal Resource Mobilization Policy 15. Complete the strengthening 06/30/92 MMH 4.14 of MMH Branch Offices 16. Seek Parliament's approval 09/30/92 MMH 5.10 of Municipal Resource Mobilization Policy 17. Put into effect project cost 01/01/96 MMH 5.09 recovery in Taiz B. MONITORING INDICATORS Quaterly reports should provide updates on the status of the following monitoring indicators: (a) procurement; (b) disbursement; (c) construction progress; (d) appointment and performance of consultants; (e) progress on institutional programs; (f) progress on programs for municipal resource mobilization policy and project cost recovery; and (g) work program for the two subsequent quarters. - 38 - Annex 6 YEN ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEmVLOPMENT PROJECT MINISTRY OF MUNICIPALITIES AND HOUSING ORGANIZATIONAL CHART HINISTER Secretary Public Relations DEPUTY MINISTER Legal Assist .Deputy Assist. Deputy Minister for :Minister for Finance and .Technical Administration Affairs i11- |Planng. Directorate Housing Directorate] Slaug ter- Finance and Physical Projects Urb Dev. Houses & l|Administrat. | Planning ||||& Housing| Heat Hark. H .............~~~~~...... ........... Environment .Tech. Advisor on. .Tech. Advisors . . .Central Health .Natural Disaster .on Pub. Works and. .Office for .Mitigation and .Muncipal Eng. . . .Proj. Imp. .early warning . .................. .and Mgmt. .systems . . .................... and Tech. ................... .. Tech. Advisors on .Advisor on . Housing on Urban . Proj. Mgmt. . Dev. Policy . & Urban Dev. ...................... ....... ....... .Field Office for ......... .Const. Superv. in Taiz - 39 - Annex 7 YEMEN ARAB REPUBLIC TAIZ FIOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT TAIZ BRANCH OFFICE ORGANIZATIONAL CHART General Director Special Project Steering Secretary.. Committee Deputy General. Director | __ X ~~~Assist. G.D. Asst. G.D. Taiz Asst. G.D. Finance and Administ. Rural Areas Solid Waste Div. 13 Branches Accounting Tech. Office Personnel Environment Div. Commercial Permits Security Field Office for Construction Supervision and Technical Advisor for Construction Supervision ....................... - 40 - Annex 8 Table:1 Yfl Arab RepubliC Taiz Ftood Disaster Prevention and Municipal Developmnnt Project ministry of Municipoeitles and Hueing Employee Roster AS St Dece5ber 31, 1969 ..................... Secondary Cities .................... MMM Neadquarters Sansa Al Al Al Regula. Projects City INN Tait HodNida Ibb NhOWr 8A d NadJe Lmahkwt Narib Jouf Saadah Total Permanent Emptoyees: Engineers 109 2 32 1 26 1S 15 5 1 0 0 2 0 0 208 Technicians 91 6 85 13 25 31 23 14 1 4 5 2 0 1 301 Asministrative 154 14 87 43 70 129 78 25 7 44 22 7 9 7 696 Drivers 19 0 33 4 5 0 6 3 3 5 3 1 4 2 88 Laborers 28 398 66 41 241 398 83 20 30 38 47 6 * 15 13 1424 Sotid Waste Collection 8 0 0 1 1 0 0 0 0 0 0 0 0 0 10 ......... ........... ....... ......... ..... ...... ... ...... .... .... ..... ........ . ... . .. ...... ....... ..... ...... ....... .... .. ......... .......... 409 420 303 103 368 s73 20S 67 42 91 r7 18 28 23 2727 Seasonal Emptoyees: Engineers 0 0 2 0 0 0 0 1 0 1 0 0 0 0 4 Technicians 0 0 0 0 1 0 0 0 0 0 0 0 0 0 1 Adninistrative 29 0 38 5 2 29 1 18 3 7 3 1 0 0 136 Drivers 3 4 14 0 3 16 23 9 7 3 3 3 1 1 90 Laborers 21 30 25 46 20 4 87 20 38 30 24 24 36 37 442 Solid waste Collection 15 3 3 2 4 0 3 0 0 0 0 0 0 0 30 68 37 82 53 30 49 114 48 48 41 30 28 37 38 703 Contract Emptcyees: Engineers 66 0 13 0 6 13 2 0 0 0 0 1 0 0 101 Technicians 13 0 14 0 1 0 2 0 0 0 0 0 0 1 31 Administrative 39 0 19 3 3 4 4 0 2 1 0 2 1 1 79 Drivers 11 0 35 0 0 0 0 0 0 2 0 0 0 0 48 Laebrers 14 0 29 0 0 0 0 0 0 9 0 6 0 0 58 Sotid Wate Collection 4 0 1 0 0 0 0 0 0 0 0 0 0 0 5 .._.... ................ ........... ...... ........ ..... ....... ...... ........ ...... ..... .: .... ....... ........ ..... .... .. ...... ...... ........ 147 0 111 3 10 17 8 0 2. 12 0 9 1 2 322 total 624 457 496 1S9 408 639 327 115 92 14'4 107 55 66 63 3752 00333--3 -- 33 -03 33 30ss3 =333 33330 3 0 330 303 333333 33330 3303 333 3333 - 41 - Annex 9 Page 1 of 2 Table: I Yesen Arab RepLblic Ninistry of NLnicipalities w Housing Consotidated Budget (in YR 000fs) For The Years Ended December 31 Budget Estimates --- Actuale -- 1990 1989 1988 1987 ......... ............. ......... ................... .............. Reeurrent Exp92itu7 1s: Salaries and uases 193,737 157.02 131,978 n 517 Service Expenses 92 884 76,112 81,943 32,631 ......... ............. ......... ............. ................... 286,621 233,144 213.921 104,148 ......... .............. ................. ._.................. Transfer Expenditures: Comensation Payments 201 201 197 64 Capital Expenditures: Project Investments 249,100 204,000 140,751 119,149 ......... . ....... ......... .......... 535,922 437.345 354.869 223,361 . .. . Table: 2 Yemen Arab Republic Ministry of Municipalities and Housing Analysis of Project Investments (in YR 000s) For The Years Ended December 31 Budget Estimates --- Actuals -- 1990 1989 1988 1987 ......... ............. ......... ............. ................... Ninistry Building & Offices 0 n/a nWa n/a Solid Uaste Equipment 17.000 nta n/a n/a Emwireruental Health 2,000 n/ n"a n/a Housing & Urban Dtevelopmnt 46 100 n/a n/a nWa Street Lighting 30,000 n/s n/Q n/a Reads 129,000 n/a n/a nta Traffic Signals 10,000 n/a n/a nWa CentraL Markets 3,000 n/a nWa n/a Parks 9,000 nWa n/a n/a Physical Plant ing Projects 1,000 n/a n/a nta Abbatoirs 4.000 n/a n/ n/a ......... ......... ......... ......... 249,100 204,000 140,751 119,149 ......... ......... ......... ......... - 42 - Annex 9 Page 2 of 2 Table: 3 Yemen Arab Rqp'hlic Ninistry of Mumicipalities and Mousing Analysis of Salaries and Wages (in YR 000's) For The Years Ended Oecefber 31 Budget Estiostes ... Actuals ^ 1990 1989 1988 1987 Permanent EqAloyeas 77,500 73.273 63,719 44,448 Temporary Employees 15,500 13,900 12,041 12,364 overtime an Allorwnces 18,503 16,460 13,879 12,243 Pension Plan Contributions 4,650 4.397 3.488 2.462 Solid Waste Collection: 77,524 49.000 38,851 0 ,... .... .. ..... .... .......... i..... . 193,73? 1ST,032 131,978 71,517 tsale: 4 Yemen Arab Repubilc Ministry of 4nmicipalitles and Housing Analysis of Service Expenses (in YR 000's) For the Years Ended Decabo 31 Budget Estimates --- Actuals --- 1990 1989 1988 1987 ..... ............. ......... ............................. .... Staff allowances 700 500 461 34S Fuel and Oi 11,000 10,670 8,323 7,669 Spare Parts 2,800 2.292 6,166 46 Stationary 1,500 1,000 590 530 Smatl Tools nd Equipment SO SOO 491 99 ouilding Maintenance 1,700 1,500 466 702 Road and Bridge Repair 1,000 850 93 131 office Equipment Repairs 400 3S0 149 112 Advertising 300 30U 2,217 211 Most Ccuntry Receptions t,600 1.600 360 1.881 International Travet 1SS0 1,550 1,015 689 Lands & Buildings Rentals 3,500 3,200 3,020 2,568 Equipment Rentals 2,000 1,800 0 1,189 Scholarships 2,000 2,000 48 0 Trwel Expense 2,700 2,500 2,502 1,930 Telphorn & telex 1,000 600 392 452 Water & Etectricity 30,000 30,000 48,174 13,608 Other 900 900 606 469 ProJect Expenses 27,734 14.000 6,872 0 . ........ ......... . ........ ......... 92,884 76,112 8t,945 32.631 ......... ............. ......... ............. ................... - 43 - Annex 10 Teblesi Yemen Arab Repubtie Ministry of Municipalitles snd Housing Taela Reveiwes ond Expenditures (YR 000's) For The Years Ended Oeceber 31 199 1988 1987 ......... ............. ......... ......... .... Revenues: Pltmning nd Application fees 13. 101 0 Market Licenses 371 304 66 Licenses 2,033 2,686 2,339 Service Fees 1,553 1,054 388 Rental Inmo=e (Gov't Suildinrs) 1.848 1,824 2,1S9 Other Income 653 136 148 Fines ard Penalties 675 677 284 Miscellaneou 0 98 0 Builtding Pernits 39 44S 834 Clewning Charges 1,056 62? 1,736 Rebillable Reed Works 3,052 3,22? 2,601 Water Vell Digging 121 85 34 ..... ........... ......... ........... ....... Total ROVeeUes 11,416 11.464 10,587 ... ............ . ..... ..... ......... :nes Salarles and Vages: Perminent Staff 10,406 8,6B4 6.021 Seasonal Staff 1,015 1,026 1,073 Project Staff 5.109 5,S89 0 Overtime 291 289 262 Atllounces 752 597 471 Peasion fund Contributions 624 521 333 .............. .............. ......... 18,797 16,706 8,160 opeating Expss: Fuel and Oil 761 822 666 Printing and Stationary 26 29 75 Maintenaneo 67 32 92 Ocs.ency Expenses 37 65 7 Misellaneous 116 158 222 Project Expenses 2.026 1,000 0 ..... ............. ......... ......... .... Total Expense 21,830 18,812 9,222 ....... !.......... ......... .............. .... Excess of Revenues over Expenses (10,414) (7,348) 1,365 uuu -_ mu 44- Annex 11 Page 1 of 5 YOM ARAB REPUBLIC TAIZ FLOOD DISASTER PEVNTION AND MUNICIPAL DEVKQPMfiET PROJEC ECONOM1C ANALYSIS The Criteria 1. The following criteria were used in the economic analysis: (i) the net present value and the economic rate of return are based on annual mean values; (ii) all benefit component data was, except for the flood damage to properties, obtained directly as annual values; (iii) all benefits accrued to property damage were based on the mean annual benefit obtained from a loss -probability curve (obtained from the FHRC computer model developed by the Flood Hazard Research Center of Middlesex Polytechnic, UK); (iv) the scheme life was takan to be 45 years (1991-2035), the discount rate 10, and the flood frequency of 1:20 years; (v) sensitivity analysis were carried out to determine the effect of project cost increases and benefits decreases, and switching values calculated for project cost, total benefits anJ the overwhelming property damage benefit; (vi) the benefits are phased through the last two years of capital expenditure in proportion to the accumulated expenditure in previous years, commencing in 1997; (vii) a factor of 0.7175 was used where acquired benefit data included subsequent phases of flood control works; and (viii) the 20 year flood affects 401 more properties than the 10 year flood. the Benefits 2. ProRertv Damage. The results of the Household and Flood survey carried out in Taiz, provided data on the frequency and damage sustained by properties in part of the project area. The extrapolation of numbers affected to the whole area; it was based on estimates developed by MMH and the consultant engineer (Halerow Fox Eng.). Mean values have been used for reported damage per - 45- Annex 11 Page 2 of 5 flood event, differentiating between shops and other properties, and the "Old Town" and elsewhere. The flood data enabled identifying four flood event frequencies to develop a reasonable loss-probability curve. These flood events were categorized as follows: Flood Freauenv Extent of Damage 1/3 year no significant damage 2 year moderate damage 10 year extensive damage 20 year major damage 3. The use of a loss-probability curve has enabled the inclusion of benefits resulting from the lower impact of flood events more severe than the 1:20 year flood frequency design period. 4. Road Surface. Sewer Regairs and Sediment Clearing. The proportion of the annual expenditure incurred in the project area attributable to flooding was obtained from the Taiz Branch Office (TBO). 5. Parked Cars. It was reported by the TBO that the 1 in 10 year flood event causes material damage to about 10 cars, with the extent of damage between minor and total write-off. This was interpreted to a mean annual damage to one car amounting to 50X of its value (YR 75,000). 6. Road Traffic. This cost was based on taxi fares, fuel and time benefits calculated on behalf of TBO as a result of the road improvements inherent in the phase I works. 7. Land Enhancement. The net enhancement value for the area along Wadi 1 was estimated at YR 13.59 million and included as a single benefit in 1998. List of Annual Benefits (YR million) Benefits 1997 1992 12999 ......... 235 Property Damage 26.03 27.78 29.94 29.94 Roads Repairs 1.03 1.10 1.16 1.16 Sewer Repairs 0.52 0.55 0.58 0.58 Sediment Clearing 0.44 0.47 0.50 0.50 Rarked Vehicles 0.07 0.07 0.07 0.07 Road Traffic 1. 1.18 1.25 1.25 Total Benefits 29.20 31.17 32.81 32.81 8. Other Unauantified Benefits. The following benefits were not included as they could not be quantified: (i) lower incidence of personal accidents during flood events and generally as a result of improved roads and pedestrian areas; - 46 -Annex 11 Page 3 of 5 (ii) reduced levels of worry snd strees in the community; (iii) improved standards of environmental health, fewer fractured and obstructed sewers causing nuissance and health hazards; (iv) improved access to upper reaches of wadies will result in a higher standard of street cleanliness and refuse collection; (v) less damage, if any, to water, telephone and electricity supplies; (vi) access routes to the main hospital will not be cut-off for the duration of flood events; and (vii) street market disruption will be avoided several times each year. -the Cost, 9. The project cost includes the investment cost of all components and the annual maintenance cost (from 1998 to 2035) based on constant prices, that is, excluding price contingencies. The following annual disbursements in YR millions were used: Year 1291 12 1221 1224 l99S 1224 1997 1228 1299..23 Costs 12.00 43.25 35.36 41.99 36.57 20.52 10.26 5.05 0.40 0.40 AnalYsis Results. 10. The results of the economic analysis are summarized below: (i) Table 1 shows a net present value of YR 30.4 million, with an economic rate of return for the project of 12X, and a benefit/cost ratio of 1.20; (ii) exclusion of the Wadi 1 land enhancement from the benefits results in a NPV of YR 24.1 million, an ERR of 122 and a B/C ratio of 1.15; (iii) the land enhancement benefit is clearly not a critical economic component; (iv) an analysis of switching values based on a 10 discount rate shows that a zero NPV is obtained if (a) costs increase by 20Z, or (b) benefits are reduced by 20X, or (c) property damage, the single largest benefit item, decreases by 222; and (v) under a plausible scenario of 102 increase of project costs and a 201 decrease in benefits the NPV (based on a 102 disco-unt rate) of YR -21.8 million, and an ERR of 92 were obtained. - 47 - Page 4 of 5 Tabe Table 1 - Net Present Value Table 2 - Sensitivity Analysis for NPV Table 3 - Sensitivity anlysis for ERR TABLE 1 - NET PRESENT VALUE YEARS BENEFITS TOTAL COST NET BENEFITS 1991 --- 12.00 (12.00) 1992 --- 43.25 (43.25) 1993 --- 35.36 (35.36) 1994 --- 41.99 (41.99) 1995 --- 36.57 (36.57) 1996 --- 20.52 (20.52) 1997 29.20 10.26 18.94 1998 44.76 5.05 39.71 1999 32.81 0.40 32.41 .... ..~~~~~.. .. . . . .. . .................. 20'35' 32.8-1- 0.40 32.41 NPV 184.41 153.97 30.44 Benefit/Cost - 1.20 TABLE 2 - SENSITIVITY ANALYSIS NET REUSENT VALUES Variation of Benefits -0 -20X -50X Variation +OX 30.4 -6.4 -61.7 of Cost +101 15.0 -21.8 -77.1 - 48 - Maex 11 Page 5 of 5 TABLE 3 - SENSITIVITY ANALYSIS ECONOMIC RATE OF RETURN Variation of Renwfits -0% -20X -502 Variation +0% 12 10 6 of Cost +10% 11 9 5 -49- Anex 12 Page 1 of 4 YEMEN ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT AFFORDABILITY ANALYSIS 1. Introduction. IDA project appraisal mission together with MKH's staff developed the following criteria for the analysis of the project cost recovery. For the purposes of this presentation, the analysis has been divided into four parts, namely: Part A- project cost estimates and recovery alternatives; Part B- cost recovery criteria and monthly payback calculations; Part C- number of beneficiaries and average monthly charges; and Part D- billing and collection mechanisms. Part A - Project Cost Estimates and Recovery Alternatives 2. Given the financial constraints at the macro level, it was agreed that the proposed project would comprise only of essential flood protection investments--all others would be deferred until additional resources became available. Based on this agreement, the total project costs, comprising essential flood control works; expropriation costs; maintenance equipment; project administration; technical assistance; and training, is estimated at YR 280.80 million including contingencies. 3. Discussions were held with MMH officials as to the proportion of total costs that should be recovered. The following table presents four cost recovery alternatives, which range from recovery of total project costs (YR280.80 million) to recovery of only the cost for essential flood control works (YR229.92 million). Cost Item Cost Recovery Amounts in YR Millions Alt. A Alt. B Alt, C Alt, D Flood Control Works 216.12 216.12 216.12 216.12 Expropriation Costs 6.36 6.36 6.36 --- Maintenance Equipment 12.00 12.00 --- --- Subtotal 234.48 234.48 222.48 216.12 Project Administration 16.20 16.20 16.20 --- Tech. Assist./Training 16.32 _ 8.08 --- --- Total Cost Recovery 267.00 258.76 238.68 216.12 Annual Maintenance Cost 0.40 0.40 0.40 0.40 - 50 - Anr.ex 12 Page 2 of 4 Part B- Cost Recovery Criteria and Monthly Payback Calculations 4. It was agreed that cost recovery should not be introduced until after the investments have been implemented. This means that a five-year grace period (1991-95) would be appropriate, with actual cost recovery commencing in 1996. It was further agreed that for the purposes of matching average monthly payments against generally accepted affordability criteria, a 20-year pay back period would be appropriate. It is noteworthy that a 30-year payback period was also considered, but was discounted because the average monthly payment would be reduced only by about 10 X, thus resulting in no significant positive impact on affordabilty. 5. Given also that there are competing demands at the national level for relatively scarce investment resources, there is an opportunity cost to this project. It is considered essential that at least part of this opportunity cost should be recovered. Therefore, a 10 carrying charge has been introduced (the carrying charge in the two earlier urban projects was 11). 6. Based on the foregoing criteria, the following table shows the total monthly pay back amount over 20 and 30 years respectively (including monthly maintenance costs of YR 20,000): Pay Back Period 20 Years 30 Years Alternative A YR 2,705,151 2,464,073 Alternative B YR 2,625,768 2,391,765 Alternative C YR 2,432,324 2,215,562 Alternative D YR 2,214,987 2,017,591 Part C - Number of Beneficiaries and Average Monthly Charges 7. The project has significant benefits not only for the project area but also for the city as a whole. For example, the project will improve vehicular traffic originating (and destined) to points outside the project area. Similarly, many workers living outside the project area do work inside the area, The project also reduces the risk to human life caused by the frequent flash floods. 8. An analysis, therefore, has been undertaken to measure the impact on the monthly charges if costs were recovered on a citywide basis rather than a project area basis. The following table shows the number of beneficiaries in the project area and in the city as a whole: 51- hmAnnex 12 Page 3 of 4 Number of Beneficiaries Project Area Citwide Number of Households 5,134 26,235 Shops 500 8,119 Workshops 30 898 Industries l 8 Total Beneficiaries 5,665 35,260 9. Based on the foregoing, and assuming that all costs would be recovered equally from each beneficiary, the average monthly charge would be as follows: Average Monthly Charge Proiect Area Citywide Basis 20 Yeaxs 30 Years 20 Years 30Years Alternative A 477 434 77 69 Alternative B 446 407 71 65 Alternative C 424 386 68 72 Alternative D 384 350 62 56 10. As can be seen from the foregoing, the average monthly charge would be unaffordable if total project costs were recovered only from the project area. In fact, the project is only affordable if costs are recovered on a citywide basis. 11. Moreover, the foregoing has been computed on the basis of a flat rate tariff. Such a mechanism does not take into consideration the income disparities between the various households. A much preferred methodology is a differential pricing mechanism, where the higher income groups and the commercial and industrial beneficiaries pay a higher proportion of the costs. 12. The difficulty in differential pricing, however, is to find an administratively simple way of determining the real capacity to pay of each househoid. One such mechanism used widely in other countries is to accept the average electricity bill for each of the above categories (which is highly income elastic) as a proxy for determining real capacity to pay. 13. The following table shows a profile of Taiz electricity billings as at October 1989 by category and by number of consumers, together with the average monthly bill for each category of consumer. Profile of Taiz Electricity Consumers (in YRs) Total Number of Average Consumer Billings Consumers Monthly Bill Households 2,968,505 26,235 113 Shops 1,260,950 8,119 155 Workshops 529,532 898 589 Industries 597,119 8 74,640 - 52 - Annex 12 Page 4 of 4 14. Using a recovery factor of 40X of the average monthly electricity bill for households, shops and workshops respectively,. and 4 X for industries, the following table shows the average monthly charges which result in a total amount recovered of YR 1,919,769. This amount is more or less representative of the total project costs outlined in any of the above alternatives. The advantage of differential pricing is that a typical lower income beneficiary having for example a monthly electricity bill of YR 50, would pay as little as YR 20 per month, while a higher income beneficiary would pay proportionately much more. Average Monthly Charge Using Differential Pricing Average Monthly Average Total Electricity Recovery Monthly Amount Consumer Bill Factor Charge Recovered Households 113 40.0 X 45 1,180,575 Shops 155 40.0 X 62 503,378 Workshops 589 40.0 % 236 211,928 Industries 74.640 4.0 X 2986 23.888 Total 1,919,769 Part D - Billing and Collection Mechanisms 15. There are three potential billing and collection mechanisms, notably: (i) the national electricity authority (YGEC); (ii) the National Water Authority (NWSA); and (iii) the MMH itself. 16. The preferred mechanism is the YGEC for three main reasons. First, it has the most extensive service coverage in Taiz; second, it provides an administratively simple basis for improving the income distribution potential of the project; and third, since there is already an administrative system for billing and collection, the added administrative cost will be marginal. - 53 - Annex 13 YEMEN ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT MUNICIPAL RESOURCE MOBILIZATION POLICY IMPLEMENTATION ACTION PLAN Proposed Actions ImRlementation Daggs By 1. Complete Draft Munic.Res.Mob.Study May,1990 IPA 2. Review and Comment on Study Aug.1990 MMH/IDA 3. Complete Study Sep.1990 IPA 4. Draft MfM Policy & Mechanisms Dec.1990 MMH 5. Review of MRM Policy & Mechanisms May 1991 Gov./IDA 6. Final Draft MRM Policy & Mechanisms Jun.1991 MMH 7. FLCCD's Review of MRM Policy & Mechanism Aug.1991 MMH/FLCCD 8. Submit Draft MRM Policy to Cabinet Sep.1991 MHH 9. Cabinet's Review and Approval Jan.1992 Cabinet lO.Submit MRM Policy & Mech.to Parliament Sep.1992 P.M. ll.Parliament's Review and Approval Jun.1993 Parliament 12.Develop Cost Recovery Mechanism for Taiz Dec.1993 MMH 13.FLCCD's Review of Taiz CRM Mar.1994 MMH/FLCCD 14.Implement Taiz Project Cost Recovery Jan.1996 MMH/TBO Notes: MRM - Municipal Resource Mobilization FLCCD - Federation of Local Councils for Cooperative Development MMH - Ministry of Municipalities and Housing Gov.- Government IPA - Institute of Public AdmiAistration (consultant) P.M.- Prime Minister TBO - Taiz Branch Office (MMH) CRM - Cost Recovery Mechanism - 54 - Annex 14 YEMEN ARAB REPUBLIC TAIZ FLOOD DISASTER PREVENTION AND MUNICIPAL DEVELOPMENT PROJECT SELECTED DOCUMENTS IN THE PROJECT FILE A. General Al Population Data - NMH B. Reports by Consultant Project Feasibility Study: Conceptual Design and Planning Report, Dated October 1988, Prepared by Halcrow Fox and Associates B1. Volume 1 - Text B2. Volume 2 - Figures and Tables B3. Volume 3 - Appendices Preliminary Design: Taiz Flood Control Project, by Halcrow Fox and Associates B4. Volume 1 - Design Report, November 1989 B5. Volume 2 - Appendices (Calculations) B6. Set of Design Drawings (110 Sheets) C. Prolect Documentation Prepared by Bank/IDA Staff A&raisal Records: Cl. Aide-Memoire C2 Population Data C3. MMH/TBO Budgets, Revenues, Expenditures C4. Cost Estimates CS. Meetings Notes C6. Economic Analysis C7. Terms of Reference for Technical Assistance IBRD 22142 I -' 44 1 YEMEN ARAB REPUBLIC \*Dhahran TAIZ FLOOD DISASTER PREVENTION AND dNalra MUNICIPAL DEVELOPMENT PROJECT SA( )J-lI El t )< PROJECT LOCATION A Pt A B i A PRIMARY ROADS ( S;ADAH SECONDARY ROADS eC,, \ i8auda / LWADIS Jlzan \ < > / -I 6g NATIONAL CAPITALS O CITIES. TOWNS AND VILLAGES MAIN PORTS + INTERNATIONAL AIRPORTS M PROVINCE BOUNDARIES X HAJJAH ALJAWF INTERNATIONAL BOUNDARIES ~ to° | \>Abs ,J/ XKhamr 16 Luhalya JSANA'A Saul aycna ALt8 b>AI Mareb '2jdt l-------ht the .,,I' '. - if,. 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