RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING PROVINCIAL AND RURAL INFRASTRUCTURE PROJECT (CREDIT 3822-KH)

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1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Sustainable Development Department Southeast Asia Country Management Unit East Asia and Pacific Region Document of The World Bank RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF PROVINCIAL AND RURAL INFRASTRUCTURE PROJECT (CREDIT 3822-KH) (BOARD APPROVAL DATE: SEPTEMBER 11, 2003) TO THE KINGDOM OF CAMBODIA November 18, 2010 Report No: KH 1

2 ABBREVIATIONS AND ACRONYMS AWP2 Second Annual Work Program CHM Complaints Handling Mechanism GGF Good Governance Framework ICB International Competitive Bidding IPA Independent Procurement Agency ISR Implementation Status Report LBAT Labor-Based Appropriate Technology MPWT Ministry of Public Works and Transport MRD Ministry of Rural Development NCB National Competitive Bidding PDO Project Development Objectives PIA Project Implementation Agency PRIP Provincial and Rural Infrastructure Project RGC Royal Government of Cambodia TA Technical Assistant UXO Unexploded Ordnance Regional Vice President: Country Director: Sector Manager: Sustainable Development Leader: Task Team Leader: Mr. James Adams, EAPVP Ms. Annette Dixon, EASTS Mr. Vijay Jagannathan, EASIN Ms. Jeeva Perumalpillai-Essex, EASTS Mr. Siélé Silué, EASIN 2

3 CAMBODIA PROVINCIAL AND RURAL INFRASTRUCTURE PROJECT P CONTENTS Page A. SUMMARY... 6 B. PROJECT STATUS... 6 C. PROPOSED CHANGES... 7 ANNEX 1: RESULTS FRAMEWORK AND MONITORING... 9 ANNEX 2: REALLOCATION OF PROCEEDS ANNEX 3: EXTENSION OF CLOSING DATE

4 Restructuring Restructuring Type: Level 2 Last modified on date : 11/8/2010 Status: Draft 1. Basic Information Project ID & Name P071207: KH-PROVL & RURAL INFRA Country Cambodia Task Team Leader Siélé Silué Sector Manager/Director Jeeva Perumalpillai-Essex/John Roome Country Director Annette Dixon Original Board Approval Date 09/11/2003 Original Closing Date: 09/30/2007 Current Closing Date 12/31/2010 Proposed Closing Date [if applicable] 12/31/2011 EA Category A-Full Assessment Revised EA Category A-Full Assessment-Full Assessment EA Completion Date 06/29/2001 Revised EA Completion Date 2. Revised Financing Plan (US$m) Source Original Revised BORR IDA Total Borrower Organization Department Location Royal Government of Cambodia Ministry of Public Works and Transports Cambodia 4. Implementing Agency Organization Department Location Ministry of Public Works and Ministry of Public Works and Cambodia Transport Transports Ministry of Rural Development Ministry of Rural Development Cambodia 5. Disbursement Estimates (US$m) Actual amount disbursed as of 06/30/ Fiscal Year Annual Cumulative Total

5 6. Policy Exceptions and Safeguard Policies Does the restructured project require any exceptions to Bank policies? N Does the restructured project trigger any new safeguard policies? If yes, please select from the checklist below and update ISDS accordingly before submitting the package. N 7a. Project Development Objectives/Outcomes Original/Current Project Development Objectives/Outcomes The development objective is to assist the Kingdom of Cambodia to enhance the livelihood of the peoples residing in the provinces of Kampong Thom, Oddar Meanchey, Preah Vihear and Siem Reap by providing sustainable access to markets and essential services through (i) a program of road rehabilitation and maintenance; (ii) a program of capacity building and training; and (iii) development of improved public policies and strategies. 7b. Revised Project Development Objectives/Outcomes [if applicable] N/A 5

6 PROVINCIAL AND RURAL INFRASTRUCTURE PROJECT RESTRUCTURING PAPER A. SUMMARY 1. The principal change proposed is a 12 month extension of the Credit closing date from December 31, 2010 to December 31, 2011 to complete ongoing activities which will enhance the standard of living of local communities in the project areas by improving road access to socioeconomic services. In addition, it is proposed to: (a) make a related re-allocation from the unallocated category; and (b) make some changes to the indicators. B. PROJECT STATUS 2. The project was approved by the Board on September 11, 2003 with a Credit amount of SDR14.2 million. The Development Credit Agreement was declared effective on March 16, 2004 with an original Credit closing date of September 30, SDR1.456 million was cancelled on June 5, 2006 and the current Credit amount is SDR million. The Credit closing date was extended twice: a two-year extension, from September 1, 2007 to September 30, 2009 to allow the implementation of the remaining work plan. A second extension was granted from September 30, 2009 to December 31, 2010 to complete the second annual work program (AWP2) and capacity building activities funded under the Policy and Human Resources Development Fund. 3. Project implementation is complete, except for six civil works packages, for a total value of US$5.04 million. Disbursement of the credit up to November 18, 2010 is SDR 8.72 million (68.53% of the total revised Credit amount). An acceptable Action Plan to complete these six contracts by December 31, 2011 has been discussed with the Borrower. 4. Quarterly financial reports from the project are current and there are no outstanding audits. The project is in compliance with all applicable Bank safeguards policies. C. PROPOSED CHANGES 5. Closing Date. An extension of the Credit closing date from December 31, 2010 until December 31, 2011 will enable Ministry of Public Works and Transport (MPWT) and Ministry of Rural Development (MRD) to complete the six civil works packages discussed above. These six contracts will finance an additional 35.5 km of periodic maintenance/rehabilitation and four bridges. Rehabilitating these road sections will enable about 30 villages in the provinces of Siem Reap, Oddar Meanchey, and Preah Vihear to have access to markets and socio-economic services and will complete those roads already rehabilitated by other donors. Construction of the four bridges will have a significant impact on the efficiency of the road network in these provinces. They will also keep the roads passable in the case of evacuation during disasters such as cyclones. 6. Reallocation of the Project Proceeds. The proposed reallocation of Credit proceeds involves the reallocation of SDR 30,000 from the unallocated category (# 7) to the Category 5 (b) to support the incremental operating costs under the MRD component. 6

7 7. Results Framework. Some of the original outcome indicators cannot be entirely attributed to the project. It is proposed to retain only those indicators that are directly attributable to the project: (a) transport costs; (b) road access; (c) capacity building within the transport sector; and (d) road management. In addition, in order to reflect the changes made to the project scope in the past, two original output indicators are being revised: (a) the number of kilometers of secondary national and provincial roads to be rehabilitated has been reduced from 300 km to 250 km; and (b) the number of kilometers of tertiary roads rehabilitated has been reduced from 300 km to 80 km. The proposed revised results framework is provided in Annex 1. 7

8 Core Annex 1: Results Framework ANNEX 1.1 Results Framework and Monitoring (MPWT) Project Development Objective (PDO): Enhanced livelihood of the peoples residing in Kampong Thom, Oddar Meanchey, Preah Vihear and Siem Reap by providing sustainable access to markets and essential services Revised Project Development Objective: No change PDO Level Results Indicators KTM Clinic Visits PVH Clinic Visits SR Clinic Visits ODM Clinic Visits Male School Enrolment Rate Female School Enrolment Rate Rural School Enrolment Rate Urban School Enrolment Rate Tourism Volume Tourism Revenue Number of telephone per square kilometers Unemployment 1932 villages equipped with socioeconomic services linked to higher level roads in good condition Project Area NGOs Transport costs reduced in project areas at the end of the project D=Drop. C=Cont. Unit of N= New Measure R=Revised Baseline 280, ,494 69,895 97, , ,919 43,532 56, , , , ,296 2,687,731 2,697, , ,159 1,055,202 1,421,615 USD$578 millions 8 Cumulative Target Values YR 1 YR 2 YR USD$832 millions % NA 306, , ,982 94, , ,370 2,628, ,607 2,015,128 USD$1,400 millions 7.9 NA Frequency Data Source/ Methodology Responsibility for Data Collection Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD Annually Survey MPWT/MRD C # Annual Surveys MPWT Component One: Maintenance management system established and operational Revised Intermediate Result (Component One): No change N p Annually Survey MPWT/MRD x C US$ (+) (+) (-) Annual Tech. Audit MPWT INTERMEDIATE RESULTS

9 Maintenance management established and implemented for secondary roads in C Y/N N Partially Partially Partially Completed Annual Surveys MPWT MPWT Component two: Roads rehabilitated Revised Intermediate Result (Component two): No change 300 km of secondary-national and x R Km Annual Tech. Audit MPWT provincial roads rehabilitated (MPWT) Component three: Capacity building program established and implemented Revised Intermediate Result (Component three): No change # MPWT staff trained in policy design, strategy development, public involvement methods, decentralized program management, and contract management and monitoring # provincial officers trained in planning, contract management, public involvement methods, decentralized contract management, and monitoring; # staff trained in social and environmental management C # TBD Annual Progress reports MPWT C # TBD Annual Progress reports MPWT C # TBD Annual Progress reports MPWT 9

10 Core ANNEX 1.2 Results Framework and Monitoring (MRD) Project Development Objective (PDO): Enhanced livelihood of the peoples residing in Kampong Thom, Oddar Meanchey, Preah Vihear and Siem Reap by providing sustainable access to markets and essential services Revised Project Development Objective: No change PDO Level Results Indicators* Increased number of villages equipped with socio-economic services linked to higher level roads in good condition D=Drop. C=Cont. Unit of N= New Measure R=Revised Baseline Cumulative Target Values** YR 1 YR 2 YR Frequency Data Source/ Methodology Responsibility for Data Collection C # Annual Surveys MRD Km of roads receiving regular maintenance x C Km Annual Component One: Maintenance management system established and operational Revised Intermediate Result (Component One): No change INTERMEDIATE RESULTS Technical Audit Maintenance management established and implemented for secondary roads in C Y/N N Partially Partially Partially Completed Annual Surveys MRD MRD Component two: Roads rehabilitated Revised Intermediate Result (Component two): No change 300 km of tertiary roads rehabilitated x R Km Semi-annual Tech. Audit MRD (MRD) Component three: Capacity building program established and implemented Revised Intermediate Result (Component three): No change # MRD staff trained at central and regional levels in policy design, strategy development, public involvement methods, decentralized program management, contract management, monitoring, social and environmental management. C # TBD Annual Component four: Policy and strategies formulated and implemented Revised Intermediate Result (Component four): No change Integrated planning and budgeting of roads adopted in MPWT at national level C Y/N N N Partially Partially Completed Annual Progress reports Progress reports MRD MRD MRD 10

11 ANNEX 2 Reallocation of Proceeds (SDR) 1. Proceeds for Cambodia, Provincial and Rural Infrastructure Project, Credit 3822-KH, (P071207) will be reallocated as follows: Category of Expenditure Allocation % of Financing Current Revised Current Revised Current Revised Totals Totals 12,723, ,723, Works 1. Works 8,584, ,584, (a) Under Part B.1 of the Project (No change) 6,864, ,864, (b) Under Part B.2 of the Project 1,720, ,720, Goods 2. Goods 617, , (a) Under Part C.1 of the Project (No change) 307, , (b) Under Part C.2 of the Project 310, , Consultant services 3. Consultant services 2,357, ,357, (a) Under Part A.1, B.1, C.1, D.1 1,957, ,957, and E.1 of the Project (No change) (b) Under Part A.2, B.2, C.2, D.2 400, , and E.2 of the Project 4. Training 4. Training 297, , (a) Under Part C.1 of the Project (No change) 97, , (b) Under Part C.2 of the Project 200, , Operation costs 5. Operation costs 540, , (a) Under Part A.1, B.1, C.1, D.1 and E.1 of the Project (No change) 400, , (b) Under Part A.2, B.2, C.2, D.2 and E.2 of the Project 140, , Refunding of Project Preparation Advances 7. Unallocated 6. Refunding of Project Preparation Advances 7. Unallocated 221, , , , (No change) 100% of foreign expenditures, 100% of local expenditures (exfactory cost) and 85% of local expenditures for other items procured locally (No change) 95 (No change) 100 (No change) 50 (No change) 2. Implementation progress and the purpose of the reallocation are discussed in the paragraph 6 of this Restructuring Paper. 11

12 ANNEX 3 Extension of Closing Date 1. The closing date for the Provincial and Rural Infrastructure Project (Credit 3822-KH) will be extended from December 31, 2010 to December Project implementation is complete, except for six civil works packages, for a total value of US$5.04 million. Disbursement of the credit up to November 18, 2010 is SDR 8.72 million (68.53% of the total revised Credit amount). An acceptable Action Plan to complete these six contracts by December 31, 2011 has been discussed with the Borrower. 3. An extension of the Credit closing date from December 31, 2010 until December 31, 2011 will enable MPWT and MRD to complete the six civil works packages discussed above. These six contracts will finance an additional 35.5 km of periodic maintenance/rehabilitation and four bridges. Rehabilitating these road sections will enable about 30 villages in the provinces of Siem Reap, Oddar Meanchey, and Preah Vihear to have access to markets and socio-economic services and will complete those roads already rehabilitated by other donors. Construction of the four bridges will have a significant impact on the efficiency of the road network in these provinces. They will also keep the roads passable in the case of evacuation during disasters such as cyclones. 4. This will be the third extension of the Credit closing date. The first extension changed the closing date from September 30, 2007 to September 30, The second extension changed the closing date from September 30, 2009 to December 31,

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