The World Bank China: Qinghai Xining Urban Transport Project (P127867) REPORT NO.: RES46074 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF CHINA: QINGHAI XINING URBAN TRANSPORT PROJECT APPROVED ON DECEMBER 27, 2013 TO PEOPLE'S REPUBLIC OF CHINA TRANSPORT EAST ASIA AND PACIFIC Regional Vice President: Victoria Kwakwa Country Director: Martin Raiser Regional Director: Ranjit J. Lamech Practice Manager/Manager: Jung Eun Oh Task Team Leader(s): Jin Wang The World Bank China: Qinghai Xining Urban Transport Project (P127867) ABBREVIATIONS AND ACRONYMS EMP Environmental Management Plan FSR Feasibility Study Report ICM Integrated Corridor Management GRM Grievance Redressing Mechanism ITS Intelligent Transport Systems M&E Monitoring and Evaluation M&EF Monitoring and Evaluation Framework MOF Ministry of Finance MoHurd Ministry of Housing and Urban–Rural Development MTR Mid-Term review NMT Non-motorized Transport PAD Project Appraisal Document PDO Project Development Objective PTI Public Transport Interchange RAP Resettlement Action Plan RPF Resettlement Policy Framework TT Task Team XMG Xining Municipal Government XPMO Xining Project Management Office The World Bank China: Qinghai Xining Urban Transport Project (P127867) BASIC DATA Product Information Project ID Financing Instrument P127867 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 27-Dec-2013 30-May-2021 Organizations Borrower Responsible Agency People's Republic of China Xining Municipal Government Project Development Objective (PDO) Original PDO The proposed Project Development Objective (PDO) is to enable Xining residents to travel between the city center and the western part of the city in a fast, efficient, and safe manner, through strategic improvements to Wusixi Road, a major transport and urban development corridor. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IBRD-83190 27-Dec-2013 04-Mar-2014 21-May-2014 30-May-2021 120.00 99.37 20.63 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank China: Qinghai Xining Urban Transport Project (P127867) I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Project Status 1. Background. The US$120 million loan for the Qinghai Xining Urban Transport Project (the Project) was approved on December 27, 2013. The loan became effective on May 21, 2014 and has a closing date of September 30, 2019. The Project Development Objective (PDO) is to enable Xining residents to travel between the city center and the western part of the city in a fast, efficient and safe manner, through strategic improvements to Wusixi Road, a major transport and urban development corridor. The project comprises four components: (i) Urban Roads; (ii) Public Transport Improvement; (iii) Intelligent Traffic Management; and (iv) Capacity Building. The total estimated project cost is US$250.66 million, and the total International Bank for Reconstruction and Development (IBRD) financing is US$120 million. 2. The Project was first restructured in September 2019 for the following changes: (i) adjusted project activities; (ii) extended the project closing date by 20 months to May 30, 2021; and (ii) consolidated three disbursement categories into two. This is the second restructuring for the project. 3. Overall Implementation Status and Achievement to Date. Project implementation is making good progress. The project ratings of Progress towards achieving PDO and Overall Implementation Progress (IP) are Satisfactory. Most of project activities have either been completed or are nearing completion. As of April 30, 2021, the loan had disbursed US$99.37 million (82.81 percent), which reflects the physical progress of the project. However, there have been some delays in the implementation of civil works contracts, especially in Component 1, as explained below in paragraph 4. The proposed restructuring will allow three more months for PMO to complete the remaining civil work contracts, and to achieve the PDO successfully. 4. Implementation Status by Component. The implementation status of each component is as follows. The implementation plan for the remaining activities under the Project is provided in Annex A. Component 1: Urban Roads. This component includes the construction of 7 urban roads, which are part of the proposed integrated public transport corridor and are necessary for providing good quality public transport services in the newly developed Xichuan District in the west of the city. Status. All three urban roads in the original project scope, namely Xicheng Avenue, Wusixi Road and No.5 Road, have been completed and were open for traffic in 2018/2019. The integrated corridors are well received by the public, which have enhanced traffic management, promoted safer facilities for pedestrians and cyclists and piloted on-street priority for buses on the key corridors. The corridors contributed significantly to improving traffic safety and mobility. However, the four roads added during the first restructuring are experiencing implementation delays, described as follows: (i) Need to upgrade water supply and drainage network due to the newly issued “Xining City Municipal Public Facilities Reconstruction and Upgrade Work Plan” on June 15, 2020, by Xining Municipal Government (XMG). After the road cave-in accident which caused 10 deaths and 17 injuries in downtown Xining on January 13, 2020, XMG requires that all road rehabilitation projects to be accompanied with the upgrade of underground water supply and drainage network. The Qiyi-Delingha-Bayi Road and Wuyi Road, located in the old town with aged and complex underground pipelines, are now subject to this requirement. Original design thus had to be revised to include upgrading of the underground water supply and drainage network, which resulted in delays. (ii) XMG’s decision during implementation to implement phased, or “half-road”, construction measures The World Bank China: Qinghai Xining Urban Transport Project (P127867) to ensure to keep part of the road open to traffic in downtown Xining because several trunk roads are under construction simultaneously in Xining (e.g. Kunlun expressway, etc.). This resulted in slower construction progress. (iii) The implementation was affected by the outbreak of COVID-19 in China. Though no coronavirus case was found on site, the construction activities of the project were suspended in compliance with local government’s requirement. The implementation progress of the Project slowed down as impacted by additional onsite measures to counter the COVID-19, travel control restrictions during the COVID-19 pandemic, and restoration of supply chain. (iv) Compared to previous years, winter season was longer in Xining in 2020-2021 which has led to shorter time suitable for construction. No construction work can be done from November 2020 to March 2021 due to the cold weather. Component 2: Public Transport. The component includes (i) physical improvements on the public transport corridor; (ii) advanced public transport system (APTS); (iii) bus procurement; (iv) bus-charging stations; and (iv) public transport interchange. Status. All activities in this component have either been completed or are nearing completion. The Wusixi dedicated bus lane in downtown Xining opened to bus traffic in February 2018. The APTS (bus dispatch and management system and on-board bus units for passenger flow analysis system) is operational. The bus lanes and APTS have helped improving operational efficiency of the bus network. 145 e-buses were delivered and in service, which significantly reduce the emission and improve the comfort of passengers. The construction of Wangjiazhai Public Bus Interchange (PTI) is ongoing with the remaining decoration works and will be completed by the current closing date. 73 bus-charging stations are under construction and will be completed before the current closing date. Component 3: Intelligent Traffic Management. This component includes: (i) construction of traffic command center; (ii) area traffic control (ATC) system; and (iii) equipment for traffic monitoring, enforcement and information services. Status. All activities in this component have either been completed or are nearing completion. The traffic control center became operational at the end of August 2019. E-Police and CCTV systems at 31 junctions of the Wusixi Corridor were completed and in operation. Traffic signal lights at 37 locations, detector systems at 16 locations, the signal priority implementation for bus lane, and installation of communication system on Xicheng Avenue and Wusixi Road have been completed. Traffic monitoring and enforcement systems are on track and will be completed before the current closing date. Component 4: Institutional Capacity-building Component. This component includes urban transport related studies, technical trainings and knowledge exchange, project management and technical consultancy, and public communications. Status. The key urban transport related technical assistance studies will support the achievement of the PDO. All technical assistance activities under this component are completed, which will strengthen the institutional capacity of the local municipalities to develop solutions to address urban mobility challenges. Additionally, 763 officials and technical staff have participated in training on Bank safeguard and fiduciary policies, which resulted in greater counterpart capacity to manage the project more effectively and in accordance with the Bank requirement. 5. Compliance. The project is in compliance with Bank fiduciary and safeguards policies, as well as loan covenants. Risk ratings for fiduciary and environment and social are both rated as Moderate. The environmental assessment category The World Bank China: Qinghai Xining Urban Transport Project (P127867) will remain at B for this restructuring. The requirement for the upgrade of water supply and drainage network in connection to the Project roads as described in paragraph 4 has already been taken into account from a safeguards perspective. As the Project includes both new construction and renovation of existing urban streets, the Project EMP includes full sets of environmental measures for road construction and renovation which cover the water and sewage pipeline works along with the road construction/renovation. As these pipelines are within the right-of-way of the existing streets, there is no land acquisition or resettlement issue involved. The compliance with EMP has been satisfactory. There are no overdue audit reports or unresolved issues highlighted by auditors. B. Rationale for Restructuring 6. Based on the current implementation progress and the revised implementation plan, the civil works contracts in component 1 cannot be completed by the current closing date as explained above in paragraph 4. Accordingly, the PDO and multiple indicators, including 2 PDO indicators (PDO indicator 1. average travel time of public transport users during the morning peak period on weekdays on the project corridor and 2. public transport beneficiaries from the project corridor) and 2 Intermediate indicators (Intermediate indicator 1. percentage of urban roads constructed, and 2. ChinaRAP rating of road safety risks on project roads), could not be achieved. 7. The Ministry of Finance (MOF) has sent a restructuring request to the Bank on February 9, 2021, seeking to extend the project closing date by 3 months. The PMO has prepared a revised implementation plan (see Annex A), which shows that the remaining activities will be completed by August 2021. With the project restructuring, it is expected that the PDO will be achieved and all indicators will be met. 8. Implementation Schedule and Disbursement Estimates. The implementation schedule and the disbursement estimates are proposed to be modified to reflect the delays and the revised implementation plan (Annex A). These changes are recorded in Section IV Detailed Changes. There are no changes to the implementation arrangements of the project, and all activities will be managed through the city-level PMO. 9. Risk Assessment. The Project’s overall risk rating remains as Moderate as most of the activities have either been completed or are nearing completion. The risk rating of the Other category was activated to reflect risks posed by the Covid-19. It is proposed as Moderate since Covid-19 outbreak may take place during the remaining implementation period and lead to citywide lockdown. The Bank team will closely monitor the Covid-19 situation in the city and the project progress, and support the project agencies addressing the potential issues through supervision/virtual missions and its routine work. II. DESCRIPTION OF PROPOSED CHANGES 10. The following changes are proposed: (a) The closing date of the project is proposed to be extended for three months from May 30, 2021, to August 30, 2021; (b) The implementation schedule and disbursement estimates are proposed to be updated to reflect the 3-month extension. The World Bank China: Qinghai Xining Urban Transport Project (P127867) III. SUMMARY OF CHANGES Changed Not Changed Loan Closing Date(s) ✔ Disbursement Estimates ✔ Implementation Schedule ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ Results Framework ✔ Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Overall Risk Rating ✔ Safeguard Policies Triggered ✔ EA category ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) The World Bank China: Qinghai Xining Urban Transport Project (P127867) OPS_DETAILEDCHANGES_LOANCLOSING_TABLE LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IBRD-83190 Effective 30-Sep-2019 30-May-2021 30-Aug-2021 30-Dec-2021 OPS_DETAILEDCHANGES_DISBURSEMENT_TABLE DISBURSEMENT ESTIMATES Change in Disbursement Estimates Yes Year Current Proposed 2014 0.00 300,000.00 2015 10,000,000.00 10,000,000.00 2016 4,265,767.32 4,265,767.32 2017 5,498,427.71 5,498,427.71 2018 9,702,529.04 9,702,529.04 2019 19,727,752.43 19,727,752.43 2020 48,805,523.50 35,568,339.22 2021 0.00 14,307,239.18 . The World Bank China: Qinghai Xining Urban Transport Project (P127867) Annex A: Implementation Plan for the Remaining Activities WB/counterpart Component Remaining Activity Status Completion Date funded Bayi Road WB Under construction 2021.07.30 1 Urban Roads Delingha Road WB Under construction 2021.07.30 Qiyi Road WB Under construction 2021.07.30 Wuyi Road WB Under construction 2021.07.30 Charging Stations WB Near Completion 2021.05.30 2 Public Transport Wangjiazhai Public WB Near Completion 2021.05.30 Transport Interchange (PTI) 3 Intelligent Traffic Monitoring and Traffic WB Near Completion 2021.05.30 Enforcement System Management