The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) Project Information Document (PID) Appraisal Stage | Date Prepared/Updated: 18-Apr-2023 | Report No: PIDA35601 April 18, 2023 Page 1 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) BASIC INFORMATION OPS_TABLE_BASIC_DATA A. Basic Project Data Country Project ID Project Name Parent Project ID (if any) Comoros P180734 Comoros Interisland P173114 Connectivity Project Additional Finance Parent Project Name Region Estimated Appraisal Date Estimated Board Date Comoros Interisland Connectivity EASTERN AND SOUTHERN 11-Apr-2023 31-May-2023 Project AFRICA Practice Area (Lead) Financing Instrument Borrower(s) Implementing Agency Transport Investment Project The Union of Comoros Ministry of Maritime and Financing Air Transport Proposed Development Objective(s) Parent The Project Development Objective is to improve maritime transport climate resilience between the islands. Components Improvement of climate resilience of port infrastructure Implementation Support and Capacity Building Contingency Emergency Response PROJECT FINANCING DATA (US$, Millions) SUMMARY -NewFin1 Total Project Cost 15.00 Total Financing 15.00 of which IBRD/IDA 15.00 Financing Gap 0.00 DETAILS -NewFinEnh1 World Bank Group Financing International Development Association (IDA) 15.00 IDA Grant 15.00 April 18, 2023 Page 2 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) Environmental and Social Risk Classification High Other Decision (as needed) B. Introduction and Context Country Context 1. This Project Paper seeks the approval of the Executive Directors to provide an Additional Financing (AF) in the amount of US$15 million from the International Development Association (IDA) to the Union of Comoros for the Comoros Interisland Connectivity Project. Given limited available resources for small countries, such as the Comoros, the project takes a programmatic approach in close collaboration with other development partners to mobilize all available resources. The parent project constitutes the first phase of a series of projects (SOP1) and was approved on May 20, 2022, and made effective on August 23, 2022. SOP1 is focused on investing in two-thirds of breakwater and protection at Port Boingoma and was restructured on December 12, 2022, to incorporate co-financing approved by the French Development Agency (Agence Française de Développement, AFD) in September 2022. 2. Despite the short period since its effectiveness, project preparation and implementation have advanced. The detailed design and bidding documents for Port Boingoma were prepared. The initial selection for the port rehabilitation work was completed. However, the currently confirmed resources can only finance two-thirds of the breakwater. The remaining part was initially planned to be financed under the second phase (SOP2), which is under preparation in collaboration with other co-financiers and envisaged to be approved in late 2023. This raises a risk of delaying the implementation and completion of the port rehabilitation works and further degrading Port Boingoma damaged by Cyclone Kenneth and Cyclone Cheneso. The proposed AF will complement SOP1 and advance the urgently needed components originally included in SOP2, by scaling up the component to invest in breakwater and protection and restructuring the technical assistance component to support the purchase of critical safety and communication equipment as well. 3. The Comoros is an archipelago off the coast of Mozambique in the Indian Ocean and consists of three main islands: Grand Comore, Anjouan, and Moheli. While Grand Comore with half of the total population (430,000) is highly urbanized around the capital, Moroni, the other two islands are more rural-based economies with high agricultural, fishery, and touristic potential. Such potential remains unexploited because of unreliable and limited transportation between the islands. The domestic markets are still fragmented, preventing the country from achieving more sustainable inclusive growth. 4. For small island states such as the Comoros, transport connectivity among the islands and to the rest of the world is of vital importance. Despite the recent external shocks on global trade, the demand for trade and maritime transport remains strong in the Comoros, which imports a significant amount of oil products, food products, and consumer April 18, 2023 Page 3 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) and industrial goods. During the last 10 years, the total trade volume increased on average by 5.5 percent per year.1 The increasing trend continues. 5. The Comoros is highly vulnerable to climate change impacts and natural hazards such as cyclones, coastal flooding, and heavy rainfall. Climate projections indicate that temperature would increase between 0.8°C and 2.1°C by 2060 and between 1.2°C and 3.6°C by 2090. The sea level might increase by 20 cm by 2050.2 The Government adopted its Nationally Determined Contribution and has been intensifying its effort to build more climate resilience. Still, vulnerability remains persistent, particularly in the agriculture, biodiversity, forest, fishery, water resources, health, and infrastructure sectors.3 Tropical Cyclone Kenneth hit the country on April 24, 2019, directly affecting more than 345,000 people. The substructure of Port Boingoma, one of the primary ports, was also damaged. It was further degraded by Cyclone Cheneso in January 2023, which crossed Madagascar, not the Comoros, but inundated the Fomboni area, including Port Boingoma. Unless its structural resilience is strengthened, it will continue to erode, leaving Moheli Island, the poorest region in the Comoros, disconnected from other islands and the regional and global markets. The Southeast African region, including the Comoros, continues to be exposed to a significant climate risk, although fortunately no strong cyclone has directly hit the Comoros since Cyclone Kenneth (figure 1). 6. Recent external shocks, such as the COVID-19 and global supply chain crises, highlighted the importance of reliable and efficient maritime transport connectivity. Although the Comorian economy is gradually recovering, it has been severely affected by these external shocks. International food prices have been increasing rapidly. Global maritime freight rates reached over US$10,000 per 40-foot container in 2021, five times higher than the level before the COVID crisis.4 Domestic food prices have also increased rapidly (figure 2), elevating the importance of efficient and reliable maritime transport infrastructure and services to connect the domestic, regional, and global markets. Figure 1. Historical Hurricane Tracks, 2018–2021 Figure 2. Inflation Rate Source: NOAA.5 Source: Central Bank of Comoros; International Monetary Fund (IMF). 1 CPCS. 2021. Prefeasibility Study: Comoros Inter-Island Connectivity Improvement Project: Final Report. 2 Ministry of Production, Environment, Energy, Industry and Handcraft. 2015. “Contributions PreÌ?vues DeÌ?termineÌ?es au Niveau National de l’Union des Comores.â€? 3 Ministère de l’Agriculture, de la Pêche, de l’Environnement, du Tourisme et de l’Artisanat. Co ntribution Déterminée au Niveau National (CDN actualisée) : 2021-2030. 4 According to Drewry’s World Freight Container Rates. 5 NOAA. Historical Hurricane Tracks: Interactive Mapping Tool. National Oceanic and Atmospheric Administration. April 18, 2023 Page 4 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) Current Implementation Status of the Parent Project 7. The overarching development objective at the program level is to improve climate resilience, connectivity, and safety of maritime transport between the islands. The parent project, SOP1, is focused on improving climate resilience by constructing two-thirds of breakwater and protection needed for Port Boingoma. SOP1 also supports capacity building in the port sector to fully operationalize the national port authority and properly supervise port operations, including public-private partnerships (PPPs). The second phase (SOP2) originally focused on increasing the interisland connectivity by investing in quays and superstructure of Port Boingoma and landing infrastructure at selected secondary ports and improving maritime transport safety by financing a pilot program to introduce more efficient and safer passenger boats to the informal interisland transport sector. At the first restructuring in December 2022, the scope of breakwater investment at Port Boingoma was reduced, and it was postponed to SOP2. 8. There is no technical change in overall project scope or components. The proposed AF aims at advancing two subcomponents that were originally included in SOP2: the postponed one-third of breakwater investment and communications and safety equipment, which is also urgently needed from the socioeconomic point of view. Thus, the AF will contribute largely to climate resilience and partly to maritime safety improvement (figure 3). Figure 3. Revised Programmatic Approach and Phasing Program components Objectives FY22 FY23 FY24 FY25 FY26 FY27 Breakwater of Port Boingoma SOP1 Resilience Port sector reforms Breakwater of Port Boingoma AF Connectivity ICT & safety equipment at ports Expansion of Port Boingoma Secondary port infrastructure SOP2 Safety Safer passenger boat program Technical assistance for safety Note: ICT = Information and communication technology. 9. The parent project has completed significant preparatory activities and commenced project implementation and is currently rated satisfactory for implementation progress and development objectives .6 A dedicated Project Implementation Unit (PIU) with experienced key team members was established and is fully operational to carry out day- to-day management of the project. The implementation capacity has improved significantly through the project 6The operational exception to proceed with preparation of the AF even though the project has not yet been under implementation for 12 months, required according to the World Bank Procedure, Additional Finance for Investment Project Financing (IPF) applying the Environmental and Social Policy, was granted by the Regional Vice President on February 4, 2023. April 18, 2023 Page 5 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) preparation and implementation support.7 To provide overall strategic guidance on the project, a multisectoral Project Steering Committee chaired by the Ministry of Maritime and Air Transport (Ministère des Transports Maritimes et Aériens, MTMA) was established. All Environmental and Social Framework (ESF) instruments required for SOP1, such as the Environmental and Social Impact Assessment (ESIA) and the Environmental and Social Management Framework (ESMF), were prepared and disclosed by March 2022. The detailed design and bidding documents for Port Boingoma were prepared with bathymetric and geotechnical studies completed. The initial selection for the port rehabilitation work was published in November 2022 and the initial selection evaluation was completed. The works contract is envisaged to be made by October-November 2023. 10. Due to differences in the funding cycle, other donors are still working on mobilizing their resources, creating a risk of delaying the implementation of the port rehabilitation work in an efficient manner. The total cost of the overall program, including SOP1, AF, and SOP2, is estimated at US$85 million, the vast majority of which, US$60 million, is allocated for the rehabilitation and expansion works at Port Boingoma (table 1). The port works will be divided into two tranches: (a) breakwater and protection and (b) quays and other port infrastructure. The first tranche is of foremost importance to prevent further degradation of the port and estimated to cost approximately US$30 million. Given the currently secured resources by IDA and AFD, US$20 million can be allocated to support only two-thirds of the breakwater that is needed. The anticipated resources by other co-financiers to fill the gap have been delayed, raising both financing and implementation risks. Table 1. Revised Financing Plan for SOPs and AF (US$, millions) SOP1 AF SOP2 Cost IDA Co-financing IDA IDA Co-financing Estimate Rehabilitation of Port Boingoma 60 • Protection, breakwater, dredging 30 15 5 10 • Quays, and other port infrastructure 30 10 20 Secondary ports, passenger boat program 15 15 Implementation support, compensation, technical 10 5 5 assistance, safety, and communications equipment at ports Total 85 20 5 15 25 20 Sectoral and Institutional Context 11. With the proposed AF, the timely implementation of the project can be assured to achieve its development objective, that is, improvement of climate resilience of maritime transport. The AF is intended to scale up and complete the component to invest in breakwater and protection of Port Boingoma. The climate resilience of the port needs to be restored urgently to support socioeconomic activities in local communities especially in Moheli Island and mitigate socioeconomic impacts caused by various recent external shocks. The already damaged Port Boingoma is only partially operational for a limited time, depending on weather conditions. On average, the port is operational for only two working days per week and two weeks per month, leading to repeated shortage of petroleum products and other daily 7Due to the delayed submission of financial reports and delayed recruitment of auditors, the financial management (FM) has been rated Moderately Satisfactory since August 2022. The training and intensive implementation support were provided. The performance is expected to be improving. April 18, 2023 Page 6 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) consumption goods in Moheli Island. The technical preparatory studies and procurement processes for the port investment have progressed well. The actual works are envisaged to be launched in late 2023 (depending on the procurement process). 12. With the AF, the efficient use of available resources can be assured. From the technical and contract management point of view, it is essential to seamlessly support continuous port rehabilitation works. In infrastructure investment, it is imperative to avoid excessive fragmented contracts, which would incur significant adjustment costs for mobilization and resource use. Due to various external shocks, the Government’s budget is more constrained than ever. The size of the project is considerable in the Comorian context. The port works are already intended to be divided into two tranches. With the currently confirmed resources under SOP1 (that is, US$15 million allocated to the port component under IDA and EUR 5 million from AFD), only two-thirds of the breakwater can be financed. The proposed AF can fill a remaining financing gap of about US$10 million to complete the breakwater and protection works. 13. The immediate rehabilitation work at Port Boingoma is required to avoid further physical losses to the port and contain the overall project costs. The port, damaged by Cyclones Kenneth and Cheneso, continues to erode. There is a significant climate risk of further degradation, which can be mitigated by the proposed AF. The prepared detailed design specifically aims at maximizing the climate resilience of the port. 14. Taking advantage of the proposed AF, other supplementary activities that are urgently needed can also be advanced, such as compensation and installation of maritime communications and safety equipment at ports , which were originally planned to be supported by SOP2. Given the currently constrained budgetary circumstances in the Comoros, the project needs to finance compensation for land required to secure materials or access roads for the port works.8 Maritime transport safety is another emerging concern in the Comoros. The technical assistance for the National Port Authority (Société Comorienne des Ports, SCP) is included in SOP1, but the communications and safety equipment remain to be installed or upgraded at the primary and secondary ports. This AF will support these activities. 15. While ensuring the timely implementation of the project, the AF can also provide flexibility while coordinating with other development partners. The overall project framework remains unchanged. While SOP1 and the proposed AF will focus on supporting port resilience, SOP2, under preparation, will complement the remainder of the port investment as well as other components focused on maritime safety. SOP2 is expected to be financed by IDA (FY24) and other development partners, such as African Development Bank (AfDB), which is keen to collaborate on the project and is currently mobilizing their resources and envisage to contribute to SOP2 in 2023. C. Proposed Development Objective(s) Original PDO The Project Development Objective is to improve maritime transport climate resilience between the islands. 8The financing of compensation by the project is subject to the Regional Vice President (RVP) approval, for which a request will be made based on the available information on land use and stakeholders’ livelihoods. April 18, 2023 Page 7 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) Current PDO (No change) The Project Development Objective is to improve maritime transport climate resilience between the islands. Key Results 16. The proposed AF will introduce the following key changes to the project: (a) scale up the breakwater and protection investment under Component 1 from US$20 million to US$30 million, (b) extend the timeline to start the process to recruit a private operator for Port Boingoma, (c) add more resources to existing Component 2 implementation support and technical assistance to support additional needs for potential compensation and other technical studies, (d) add a subcomponent to finance communications and safety equipment related to the existing technical assistance activity provided to the port authority, and (e) update the Results Framework and indicators to reflect these expanded scope and activities. To be aligned with the proposed change (c), the parent project will also be restructured to support an additional activity of compensation under Component 2. 17. The end target of the PDO indicator is adjusted to reflect the scaled-up investment activity in Port Boingoma. The PDO indicator is unchanged: the number of days each year when Port Boingoma is nonoperational because of weather conditions. With the proposed AF, the project is expected to finance the full amount of breakwater and protection needed rather than approximately two-thirds. There is no clear technical separation in actual works between SOP1 and AF. Together, the two projects are intended to contribute to reducing the end target of the indicator from 85 days further to 20 days (revised target). The port is currently nonoperational for approximately 216 days a year due to weather conditions. 18. An additional intermediate results indicator will be included to monitor the progress of an additional activity to support the installation of maritime communication and safety equipment at the primary and secondary ports (see Subcomponent 2.3). The rest of the results indicators remain unchanged. 19. The Results Chain is revised to reflect the above additional activities financed by the AF. However, the overall framework remains the same: Together with SOP1, the AF will contribute to build more climate resilience at Port Boingoma. The technical assistance to increase the government’s regulatory capacity in the maritime transport sector, introduce private-sector operations and improve maritime safety would also help enhance the reliability of port operations. Over the long run, interisland transport and trade would increase, opening up the market of Moheli Island and facilitating local business development April 18, 2023 Page 8 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) Activities Outputs Outcomes Objectives Economic recovery & Design and construction Increased inter- inclusive growth Enhanced resilience of a breakwater at Port island connectivity Boingoma Stronger port (Port operations and trade infrastructure Additional activities by AF regardless of weather Local business Remaining investment conditions) development in in breakwater Moheli Support for compensation Enhanced No significant external regulatory shock reducing demand Communication and safety Important equipment at ports capacity at SCP No extraordinary climate Effective regulations event damaging the port Technical assistance to for sustainable port Preparatory Government's political improve port regulations, operations work to recruit a buy-in safety and gender private operator empowerment for Port Private sector Boingoma D. Project Description Scaled-up Component 1: Improvement of Climate Resilience of Port Infrastructure (additional US$10 million from IDA grants) 20. The nature of Component 1 activity remains the same but will be scaled up. This component supports strengthening the climate resilience of Port Boingoma through constructing the remainder of the breakwater along the north side of both quays to protect against waves from the north. The port is located on Moheli Island’s northeast c oast, with a minimum capacity with a draft of 2.4 meters and a 70-meter-long, 12-meter-wide quay. The current port is not protected from extreme weather conditions (for example, heavy rainfall and high waves). In April 2019, the substructure of the port was damaged by Cyclone Kenneth. Concrete blocks used for protection of the jetty against waves were lost, gradually eroding the backfill in the foundation and leaving the deck suspended. SOP1 finances approximately two-thirds of the breakwater and the protection activities, including quarrying activities, material transportation, and breakwater construction and installation. The AF will continue supporting the remaining one-third of these activities to complete the first tranche of the port works. Thus, by this scale-up, the climate resilience of the port is expected to be secured, building on which other port infrastructure would be further developed and extended under SOP2. Revised Component 2. Implementation Support and Capacity Building (additional US$5 million from IDA grants) 21. The existing activities under Subcomponent 2.1 (implementation support) remain unchanged but more resources will be added to support additional project management works. Subcomponent 2.1 will continue supporting critical project management, monitoring, and evaluation, including operating costs of the PIU; project management, fiduciary activities, and financial and technical audits; studies and technical assistance to facilitate project preparation and implementation; and monitoring, reporting, and evaluation of project activities. April 18, 2023 Page 9 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) 22. In addition, the proposed AF will support potential compensation required for the project implementation, subject to the findings of the Resettlement Action Plan (RAP) under preparation and the RVP approval. 23. The existing Subcomponent 2.2 (Capacity building) remains unchanged and is focused on the capacity building for the SCP to manage commercial operations in the port sector, the preparation of a climate resilience strategy for the maritime transport sector, and empowerment and safety of women by developing and implementing a national maritime training program to foster skilled labor, especially for female professionals, in the port and maritime transport sector. 24. Given the current timeline of investment in Port Boingoma, the recruitment of a private operator for the operations of Port Boingoma is postponed until end 2024. The Financing Agreement of SOP1 requires a transparent competitive bidding process to select a concessionaire to be launched no later than eighteen months after the effective date, which is extended by approximately eight months (depending on the actual effective date of the AF). 25. Subcomponent 2.3: Maritime Communication and Safety Equipment will be added to enhance the above port sector capacity-building activities. This subcomponent aims at supporting the supply and installation of maritime communication and safety equipment to port operators and vessel operators, including fisherpersons, and necessary training to use it. The SCP and other related organizations in charge of maritime transport and safety lack proper communications and safety equipment to ensure timely communications between the shore and the vessels at sea when they approach and depart from the ports, mobilize rescue teams, and monitor their operations in emergencies. Main beneficiaries are port operators, port authorities and maritime safety authorities, who manage and monitor vessel movements around the ports, namely SCP and the National Agency of Maritime Affairs (ANAM). Vessel operators who approach the ports would also benefit from timely and accurate communications. Considering vessel operators’ affordability, minimum equipment will also be distributed under the condition that beneficiaries meet all necessary safety and operational requirements. The subcomponent will support the equipment and facilities, including the following: • Operations center. Inmarsat and Navtex equipment, computer, and peripherals • VHF stations. Modems, antennas, transmitters, and microwave communication system • Global Maritime Distress and Safety System (GMDSS), composed of various satellite-based emergency rescue components such as radio beacons, automated rescue signaling systems, radiotelephones, and power supply equipment • Other maritime safety equipment and communications facilities such as life jackets, portable VHF radio, and mobile phones, for vessel operators, including small boat (called kwassa kwassa) operators, fisherfolk, and other vessel operators. 26. Subcomponent 3. Contingent Emergency Response Component (CERC) remains unchanged with no allocation. . April 18, 2023 Page 10 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) Legal Operational Policies Triggered? No Projects on International Waterways OP 7.50 No Projects in Disputed Areas OP 7.60 Summary of Assessment of Environmental and Social Risks and Impacts . E. Implementation Institutional and Implementation Arrangements 27. Implementation arrangements remains unchanged. The proposed AF will follow the implementation arrangements established under the parent project, SOP1. The MTMA in charge of maritime transport policies continues having the overall responsibility for project implementation. Under the MTMA and the Ministry of Finance, Budget, and Banking, the PIU created for SOP1 will be responsible for conducting day-to-day management of the project preparation and implementation. The implementation capacity of the PIU and other stakeholders has been improved substantially through the capacity building and implementation support under SOP1. However, the implementation challenges remain significant given the complexity of the project attributed to PPP arrangements for port operations, cofinancing arrangements and management of environmental and social aspects. . CONTACT POINT World Bank Atsushi Iimi Senior Transport Specialist Borrower/Client/Recipient The Union of Comoros April 18, 2023 Page 11 of 12 The World Bank Comoros Interisland Connectivity Project Additional Finance (P180734) Implementing Agencies Ministry of Maritime and Air Transport Ali Mohamed ABDALLAH Secrétaire Général du Ministère des Transports amabdallah12@gmail.com FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects APPROVAL Task Team Leader(s): Atsushi Iimi Approved By Practice Manager/Manager: Country Director: Zviripayi Idah Pswarayi Riddihough 19-Apr-2023 April 18, 2023 Page 12 of 12