Please also refer to the PID of the parent project (Report No.: AB3812) disclosed on 04/29/2008

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1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Project Name PROJECT INFORMATION DOCUMENT (PID) APPRAISAL STAGE Report No.: AB4662 Additional Financing -Road Rehabilitation and Improvement II Region LATIN AMERICA AND CARIBBEAN Sector Roads and highways (100%) Project ID P Borrower(s) GOVERNMENT OF HONDURAS Government of Honduras Honduras Implementing Agency SOPTRAVI, Honduras Fondo Vial, Honduras Environment Category [ ] A [X] B [ ] C [ ] FI [ ] TBD (to be determined) Date PID Prepared May 4, 2009 Date of Appraisal April 16, 2009 Authorization Date of Board Approval May 21, 2009 Please also refer to the PID of the parent project (Report No.: AB3812) disclosed on 04/29/ Objective: The development objective of the Second Road Rehabilitation and Improvement Project (PRMC-II) remains unchanged, namely, improve the quality of road network and of road management in support of the Government s growth and competitiveness goals through: (a) improved governance and enhanced road management capacity in SOPTRAVI and the Road Fund (FV); (b) improvement 1 in selected road corridors; and (c) extension in the scope of the maintenance of the unpaved road network. 2. Rationale for Bank Involvement: Reasons for the Additional Financing. Tropical Depression No.16, which formed off the coast of Honduras in mid October 2008, brought heavy rains and resulted in flooding, loss of life and property damage in several Central American countries. In Honduras, increasingly vulnerable to the consequences of climate change in recent years, 320,000 persons in the northern, western and central areas of the country were seriously impacted with damage estimated at $125 million reported. With the declaration of a national emergency, response mechanisms under the Comision Permanente de Contingencias (COPECO) were activated and international humanitarian assistance from various agencies including PAHO/WHO, UNFPA and UNICEF was mobilized. The United Nations issued a Flash Appeal for Honduras in the amount of US$17million. 1 Road improvement includes engineering activities such as paving, shoulder work and drainage enhancement as well as safety oriented activities such as proper road signage and markings

2 As a result of damage sustained to the road network due to flooding, the Government of Honduras specifically requested assistance from the International American Development Bank (IADB) and the World Bank to help finance the needed the additional and unplanned rehabilitation needs at an estimated total cost of $33 million of which on December 2, 2008 the Government requested emergency assistance of US$25 million. The flooding created significant and potentially lasting damage to roads and bridges mostly in the departments of Colon, Yoro, Francisco Morazán, Olancho and Cortes - due to one or more of: (i) excessive river flow and storm water run off; (ii) land and earth slides; and (iii) opening up of geological faults. The proposed financing was to enable the Government to restore access and connectivity in affected productive rural areas and also to minimize economic losses suffered. 3. Description: Components. The Additional Financing supports the following scaled up activities to be carried out under Components 1, 3 and 4 of the parent project as follows. Under Component 1, there are three additional sub components as follows: Sub-Component 1C: Restoration of damaged primary road infrastructure ($10.0 million): The highest priority in the program is to be accorded to four of the country s main road corridors where geological faults, either newly created or seriously exacerbated by the recent flooding, have restricted transit in a number of specific locations. In the absence of timely, remedial action, there is a risk of road failure with serious economic consequences for the country. The corridors are as follows: Tegucigalpa-Danli; La Entrada-Copan Ruinas; La Entrada-Santa Rosa de Copan-Ocotepeque; and Santa Rita-Yoro. Sub-Component 1D: Restoration of damaged bridges ($8.0 million): A total of 8 bridges have been identified for restoration, selective structural strengthening and improvement of access. In each case the bridges provide a major crossing point to a river or watercourse and the damage or complete loss of the structure, sustained or exacerbated as a result of the flooding create significant loss of access in the specific localities. Sub-Component 1E: Restoration of damaged secondary road infrastructure ($4.5 million): Large parts of the secondary road network - which provides essential connectivity for productive rural areas to markets have been damaged, in particular in the following departments: Atlantida; Colon; Yoro; Cortes; El Paraiso; Olancho and Valle. The project would contribute towards the rehabilitation of about 650 kilometers of affected roads in these departments. The works would be carried out under the supervision of the FV. Under Component 3, a new Sub-Component (5) would be added to cover the costs of design, supervision and technical audit related to the mentioned additional rehabilitation works at an estimated cost of US$2.0 million.

3 Under Component 4, there will be an additional sub-component as follows: Sub-Component 4 VI: Institutional strengthening for disaster risk mitigation and planning ($0.5 million): The additional financing would support Government in the development of policies and mitigation strategies to reduce vulnerability and strengthen risk management capacity in the road sector; including the review of design and construction standards in view of the potential for greater frequency and strength of climatic events of this nature in future. The component would support selective strengthening of the technical capacity in SOPTRAVI and the Road Fund as well as provide training to the private sector (consultants and contractors). COPECO would be involved in the detailed design and implementation of this sub-component. Outcomes. There are two changes in the final outcomes for the project as a consequence of the additional financing that is: (i) creation of disaster planning and management unit in SOPTRAVI; and (ii) up to 300 kilometers of primary and secondary roads and bridges restored to good condition. The following are the additional intermediate outcomes to be included: (a) restoration of the primary road infrastructure damaged by flooding: Tegucigalpa-Danli; La Entrada-Copan Ruinas; La Entrada-Santa Rosa de Copan-Ocotepeque; and Santa Rita-Yoro; (b) construction of 8 bridges in various locations replacing damaged or destroyed structures (525 meters); (c) rehabilitation of up to 515 kilometers secondary road infrastructure in 6 most affected departments; and (d) carrying out improvements to policies and procedures in relation to disaster planning and management. 4. Financing: Source: ($m.) BORROWER/RECIPIENT 0 International Development Association (IDA) 25 Total Implementation: Project Performance to Date. The parent project PRMC-II has not yet commenced implementation. Substantial progress has been made however in the preparation of first year activities which should commence shortly following the declaration of credit effectiveness on April 27, The activities comprise: (A) two of the primary road sections scheduled for improvement that is: (i) San Lorenzo to Olanchito for which the design is essentially completed, but for which specific advance conservation measures, set out in the Supplemental Letter dated October 13, 2008 have still to be completed to the satisfaction of the Bank; and (ii) El Porvenir to Marale for which a design review is to be carried out prior to finalizing the alignment of the road improvement; (B) creation, orientation and equipping of up to 10 new micro-enterprises to undertake routine maintenance under contract of already identified pilot sections of the unpaved primary and secondary road network; and (C) carrying out of various measures to strengthen the planning and implementation capacity of the units of SOPTRAVI and of the FV directly involved in project implementation, with specific emphasis given to initiating the activities under the sector governance program.

4 Implementation Arrangements. There are no proposed changes in that SOPTRAVI and the FV are the appropriate institutions to manage the additional activities with the help of private consultants and contractors. These arrangements have been designed with a view to mitigating the negative impact that staff turnover associated with the political transition at the end of 2009 might have on implementation capacity. A technical assistance contract with a private consultant to provide specific, technical expertise to complement SOPTRAVI capacity is expected to come into effect by mid 2009 (bids were received April 23, 2009). However in recognition of the additional work occasioned by the emergency response, there will be some short term increases in capacity in the project executing unit - Unidad Ejecutora del Banco Mundial (UEBM) to specifically manage the contracting, supervising and completion of the emergency works. This will comprise the following: the hiring of an additional coordinator to focus exclusively on the emergency works program; and the hiring of an additional procurement specialist, with a strong engineering background. SOPTRAVI is giving consideration to the hiring of an international engineering consultant on a short term basis to advise the UEBM on the planning and implementation of priority works in It has already been agreed that a full time monitoring specialist will be recruited for the UEBM with immediate effect. 6. Safeguards An environmental impact assessment was recently completed and is in the process of being reviewed. All of the primary road infrastructure sections damaged were visited in January 2009 and assessed according to the Environmental and Social Management Framework (ESMF) developed for the parent project. The remaining bridges and the secondary network identified for rehabilitation were assessed during the month of April of the projects were rated as low environmental risk and only one (Santa Rita to Yoro) assessed as being of moderate environmental risk. For the purposes of the Bank, the Environmental Category is expected to remain as B, as the proposed works represent the restoration or improvement of existing infrastructure assets only, with no significant adverse negative environmental impact expected. Most of the proposed works are not expected to adversely affect critical or other natural habitats. In the specific case of the replacement of a bridge spanning the River Aguan, the works fall close to a sensitive area where the last remaining stands of endemic dry tropical forest are found. Additional conservation measures will apply during the preparation and execution of the required works. The AF will not in any event support infrastructure activities in such sensitive areas that might require a change in environmental categorization. Damage to physical cultural resources is unlikely since the roads and bridges to be rehabilitated or replaced will follow existing alignments. However specific attention will be paid in the case of the La Entrada Copan Ruinas rehabilitation given the road passes through an area of unusual richness in archaeological and anthropological artifacts. The current ESMF includes a chance finds procedure under its standard environmental rules for contractors. By mid May 2009 specific site visits will have been completed to verify whether any additional Indigenous Peoples Plans (IPP) will be required for the new road segments. If the need is

5 confirmed, the parent project s IPP will be updated and disclosed by SOPTRAVI after appropriate stakeholder consultations have been conducted and documented, expected before end July In terms of involuntary resettlement, although all the additional works are to be undertaken within the existing right of way, SOPTRAVI will carry out a verification process by mid May 2009 after which the provisions of the Abbreviated Involuntary Resettlement Plan (AIRP) drawn up for the project will be updated as needed. As in the case of indigenous peoples consultations, the ones related to land acquisition and/or involuntary resettlement stakeholders will be carried out and documented by the end of July The disclosure of any revisions required of the basic safeguard instruments for the project the ESMF, the IPP and the AIRP as well as the specific social and environmental assessments carried out for the specific sub-projects will be publicly disclosed not later than six months after the date of the AF Board approval date. However none of the additional works will start prior to the disclosure of these said instruments and or the completion of any advance social or environmental actions identified in the mentioned assessments. 7. List of Factual Technical Documents * Letter from the Government requesting additional financing * Reports regarding Tropical Depression No. 16 and its aftermath * Cost estimates * Economic Analysis * Environmental and Social Assessment * Operational Plan * Procurement Plan 8. Contact point Contact: Stephen J. Brushett Title: Lead Transport Specialist Tel: (202) Fax: Sbrushett@worldbank.org 9. For more information contact: The InfoShop The World Bank 1818 H Street, NW Washington, D.C Telephone: (202) Fax: (202) pic@worldbank.org Web:

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