FOR OFFICIAL USE ONLY Report No: PAD4229 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN IN THE AMOUNT OF US$400 MILLION TO THE REPUBLIC OF INDONESIA FOR A NATIONAL URBAN FLOOD RESILIENCE PROJECT November 28, 2022 Urban, Disaster Risk Management, Resilience And Land Global Practice East Asia And Pacific Region 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 EQUIVALENTS Exchange Rate Effective October 31, 2022 Currency Unit = Indonesian Rupiah (IDR) US$1.00 = IDR15,598 FISCAL YEAR January 1 – December 31 Regional Vice President: Manuela V. Ferro Country Director: Satu Kristiina Jyrintytar Kahkonen Regional Director: Benoit Bosquet Practice Manager: Ming Zhang Task Team Leaders: Haris Sanahuja and Jian Vun ABBREVIATIONS AND ACRONYMS APBD Anggaran Pendapatan dan Belanja Daerah Subnational Revenue and Expenditure Budget APBN Anggaran Pendapatan dan Belanja Negara National Revenue and Expenditure Budget Bappenas Badan Perencanaan Pembangunan Nasional Ministry of National Development Planning/National Development Planning Agency BNPB Badan Nasional Penanggulangan Bencana National Disaster Management Authority BPK Badan Pemeriksa Keuangan Republik Indonesia Audit Board of the Republic of Indonesia BWS/BBWS Balai Wilayah Sungai/Balai Besar Wilayah Sungai River Basin Organization CBA Cost-benefit analysis C-ESMP Contractor Environmental and Social Management Plan CPF Country Partnership Framework (World Bank) COVID-19 Coronavirus Disease 2019 CPIU Central Project Implementation Unit CPMU Central Project Management Unit DA Designated account DAK Dana Alokasi Khusus Special Allocation Fund DED Detailed engineering design DG Directorate-General DGWR Directorate-General of Water Resources DiBi Indonesia Disaster Data Information database DIPA Daftar Isian Pelaksanaan Anggaran Annual budget and line ministry budget document DRM Disaster risk management EIRR Economic internal rate of return ESCP Environmental and Social Commitment Plan ESF Environmental and Social Framework ESMF Environmental and Social Management Framework ESMP Environmental and Social Management Plan ESRS Environmental and Social Review Summary ESS Environmental and Social Standard FM Financial Management GBV Gender-based violence GCRF Global Crisis Response Framework GDP Gross domestic product GRM Grievance Redress Mechanism IBRD International Bank for Reconstruction and Development ICR Implementation Completion and Results Report IFR Interim Unaudited Financial Reports IKN Ibu Kota Negara New Capital City IOC Incremental Operating Costs IPF Investment Project Financing IPPF Indigenous Peoples Planning Framework JICA Japan International Cooperation Agency KPPN Kantor Pelayanan Perbendaharaan Negara State Treasury Office LiDAR Light Detection and Ranging LKPP Lembaga Kebijakan Pengadaan Barang Jasa Pemerintah National Public Procurement Agency LMP Labor Management Procedures M&E Monitoring and evaluation MIS Management and information system MOF Ministry of Finance MOHA Ministry of Home Affairs MPWH Ministry of Public Works and Housing NPIU National Project Implementation Unit NPV Net present value NUDP National Urban Development Project NUFReP National Urban Flood Resilience Project OHS Occupational health and safety O&M Operation and maintenance PDO Project Development Objective PID Project Information Document PIU Project Implementation Unit PMU Project Management Unit POM Project Operations Manual PPK Pejabat Pembuat Komitmen Commitment-Making Official PPSD Project Procurement Strategy for Development QCBS Quality- and cost-based selection RPJMD Rencana Pembangunan Jangka Menengah Daerah Subnational Medium-Term Development Plan RPJMN Rencana Pembangunan Jangka Menengah Nasional National Medium-Term Development Plan SEA/SH Sexual exploitation and abuse/sexual harassment SEF Stakeholder Engagement Framework SEP Stakeholder Engagement Plan SP2D Surat Perintah Pencairan Dana Payment Remittance Orders SPSE Sistem Pengadaan Secara Elektronik Electronic Procurement System (Government of Indonesia) STEP Systematic Tracking of Exchanges in Procurement UKPBJ Unit Kerja Pengadaan Barang/Jasa Pemerintah Government Goods/Services Procurement Unit WSUD Water-sensitive urban design The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) TABLE OF CONTENTS DATASHEET ..............................................................................................................................1 I. STRATEGIC CONTEXT ........................................................................................................ 7 A. Country Context................................................................................................................................ 7 B. Sectoral and Institutional Context .................................................................................................... 8 C. Relevance to Higher Level Objectives ............................................................................................. 12 II. PROJECT DESCRIPTION ................................................................................................... 13 A. Project Development Objective ..................................................................................................... 13 B. Project Components ....................................................................................................................... 14 C. Project Beneficiaries ....................................................................................................................... 18 D. Results Chain .................................................................................................................................. 18 E. Rationale for Bank Involvement and Role of Partners ................................................................... 18 F. Lessons Learned and Reflected in the Project Design .................................................................... 20 III. IMPLEMENTATION ARRANGEMENTS .............................................................................. 21 A. Institutional and Implementation Arrangements .......................................................................... 21 B. Results Monitoring and Evaluation Arrangements......................................................................... 23 C. Sustainability................................................................................................................................... 23 IV. PROJECT APPRAISAL SUMMARY ..................................................................................... 24 A. Technical and Economic Analysis ................................................................................................... 24 B. Fiduciary.......................................................................................................................................... 27 C. Legal Operational Policies ............................................................................................................... 29 D. Environmental and Social ............................................................................................................... 29 E. Gender ............................................................................................................................................ 33 F. Climate Change ............................................................................................................................... 34 V. GRIEVANCE REDRESS SERVICES....................................................................................... 36 VI. KEY RISKS ....................................................................................................................... 36 VII. RESULTS FRAMEWORK AND MONITORING..................................................................... 39 ANNEX 1: Implementation Arrangements and Support Plan ........................................... 51 ANNEX 2: Detailed Project Description ........................................................................... 59 ANNEX 3: Map ................................................................................................................ 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) DATASHEET BASIC INFORMATION BASIC_INFO_TABLE Country(ies) Project Name Indonesia Indonesia: National Urban Flood Resilience Project (NUFReP) Project ID Financing Instrument Environmental and Social Risk Classification Investment Project P173671 High Financing Financing & Implementation Modalities [ ] Multiphase Programmatic Approach (MPA) [ ] Contingent Emergency Response Component (CERC) [ ] Series of Projects (SOP) [ ] Fragile State(s) [ ] Performance-Based Conditions (PBCs) [ ] Small State(s) [ ] Financial Intermediaries (FI) [ ] Fragile within a non-fragile Country [ ] Project-Based Guarantee [ ] Conflict [ ] Deferred Drawdown [ ] Responding to Natural or Man-made Disaster [ ] Alternate Procurement Arrangements (APA) [ ] Hands-on Enhanced Implementation Support (HEIS) Expected Approval Date Expected Closing Date 19-Dec-2022 31-Jan-2028 Bank/IFC Collaboration No Proposed Development Objective(s) The Project Development Objective is to reduce flood risk in select Indonesian cities through increased national and city-level capacities and investments for integrated urban flood risk management Components Component Name Cost (US$, millions) Page 1 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Flood risk analytics and planning 45.00 Urban flood resilience measures 335.00 Program management and implementation support 20.00 Organizations Borrower: Republic of Indonesia Implementing Agency: Ministry of Home Affairs Ministry of National Development Planning / Bappenas Ministry of Public Works and Housing PROJECT FINANCING DATA (US$, Millions) SUMMARY -NewFin1 Total Project Cost 400.00 Total Financing 400.00 of which IBRD/IDA 400.00 Financing Gap 0.00 DETAILS -NewFinEnh1 World Bank Group Financing International Bank for Reconstruction and Development (IBRD) 400.00 Expected Disbursements (in US$, Millions) WB Fiscal Year 2023 2024 2025 2026 2027 2028 Annual 3.24 45.79 74.19 127.20 121.30 28.28 Cumulative 3.24 49.03 123.22 250.42 371.72 400.00 INSTITUTIONAL DATA Practice Area (Lead) Contributing Practice Areas Page 2 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Urban, Resilience and Land Climate Change and Disaster Screening This operation has been screened for short and long-term climate change and disaster risks SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT) Risk Category Rating 1. Political and Governance ⚫ Moderate 2. Macroeconomic ⚫ Moderate 3. Sector Strategies and Policies ⚫ Moderate 4. Technical Design of Project or Program ⚫ Substantial 5. Institutional Capacity for Implementation and Sustainability ⚫ Substantial 6. Fiduciary ⚫ Substantial 7. Environment and Social ⚫ High 8. Stakeholders ⚫ Moderate 9. Other ⚫ Substantial 10. Overall ⚫ Substantial COMPLIANCE Policy Does the project depart from the CPF in content or in other significant respects? [ ] Yes [✓] No Does the project require any waivers of Bank policies? [ ] Yes [✓] No Page 3 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Environmental and Social Standards Relevance Given its Context at the Time of Appraisal E & S Standards Relevance Assessment and Management of Environmental and Social Risks and Impacts Relevant Stakeholder Engagement and Information Disclosure Relevant Labor and Working Conditions Relevant Resource Efficiency and Pollution Prevention and Management Relevant Community Health and Safety Relevant Land Acquisition, Restrictions on Land Use and Involuntary Resettlement Relevant Biodiversity Conservation and Sustainable Management of Living Natural Relevant Resources Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional Relevant Local Communities Cultural Heritage Relevant Financial Intermediaries Not Currently Relevant NOTE: For further information regarding the World Bank’s due diligence assessment of the Project’s potential environmental and social risks and impacts, please refer to the Project’s Appraisal Environmental and Social Review Summary (ESRS). Legal Covenants Sections and Description The Borrower declares its commitment to the objectives of the Project. To this end, the Borrower shall carry out: (a) Part 1, Part 2, Part 3.3 and Part 3.4 of the Project through its Ministry of Public Works and Housing; (b) Part 3.2 of the Project through its Ministry of Home Affairs; and (c) Part 3.1 of the Project through BAPPENAS, in accordance with the provisions of Article V of the General Conditions and Schedule 2 to the Loan Agreement. (Section 3.01 of the Loan Agreement) Sections and Description The Borrower shall maintain, throughout Project implementation, the National Steering Committee responsible for the provision of inter-agency strategic guidance, policy advice and coordination to the Project, with a composition, institutional framework, functions, and resources satisfactory to the Borrower and the Bank for such purpose. (Section I.A.1 of Schedule 2 to the Loan Agreement) Page 4 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Sections and Description The Borrower shall, not later than three (3) months after the Effective Date, establish and thereafter maintain, throughout Project implementation, the National Urban Flood Resilience Task Force, with a composition, institutional framework, functions, and resources satisfactory to the Bank to be responsible for providing strategic oversight of the Project, coordinating urban flood resilience investments across sectors and agencies, and reviewing and approving the multi-year and multi-sectoral urban flood resilience action plan for each Eligible City. (Section I.A.2 of Schedule 2 to the Loan Agreement) Sections and Description The Borrower through the Ministry of Public Works and Housing shall, not later than three (3) months after the Effective Date, establish and thereafter maintain, throughout Project implementation, a Central Project Management Unit at the Directorate of Water Resources Management Systems and Strategy under the Directorate General of Water Resources, Ministry of Public Works and Housing, to be responsible for the implementation of Part 3.3 of the Project. (Section I.A.3 of Schedule 2 to the Loan Agreement) Sections and Description The Borrower through the Ministry of Public Works and Housing shall, not later than three (3) months after the Effective Date, establish and thereafter maintain, throughout Project implementation, a Central Project Implementation Unit at the Directorate of Rivers and Coasts under the Directorate General of Water Resources, Ministry of Public Works and Housing, to be responsible (jointly with the National Project Implementation Unit under Section I.A.5.(a)) for the implementation of Part 3.4 of the Project, including reviewing and approving project proposals, feasibility studies, detailed engineering designs, environmental and social management assessments, and other technical preparatory studies prepared by Project implementation units; disseminating ministry-wide technical guidance on Project implementation to the subnational implementation teams; and monitoring and reporting progress on various subprojects. (Section I.A.4 of Schedule 2 to the Loan Agreement) Sections and Description The Borrower shall, not later than three (3) months after the Effective Date, establish and thereafter maintain, throughout Project implementation: (a) through the Ministry of Public Works and Housing, a National Project Implementation Unit jointly at the Directorate of Water Resources Engineering Development and the Directorate of Operation and Maintenance, each under the Directorate General of Water Resources, Ministry of Public Works and Housing, to be responsible (jointly with the Central Project Implementation Unit) for the implementation of Part 3.4 of the Project; (b) through the Ministry of Home Affairs, a National Project Implementation Unit at the Directorate of Synchronization of Regional Development II under the Ministry of Home Affairs, to be responsible for the implementation of Part 3.2 of the Project; and (c) through BAPPENAS, a National Project Implementation Unit at the Directorate of Water Resources under BAPPENAS, to be responsible for the implementation of Part 3.1 of the Project. (Section I.A.6 of Schedule 2 to the Loan Agreement) Sections and Description The Borrower, through the Ministry of Public Works and Housing, shall, throughout Project implementation, maintain the relevant River Basin Organizations as Project Implementation Units to be responsible for the Page 5 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) implementation of Part 1 and Part 2 of the Project at the city level in the relevant Eligible Cities. (Section I.A.6 of Schedule 2 to the Loan Agreement) Sections and Description The Borrower shall provide, or cause to be provided, as the case may be, each of the National Urban Flood Resilience Task Force, Central Project Management Unit, Central Project Implementation Unit, National Project Implementation Units and Project Implementation Units at all times with adequate funds (allocated in the DIPA) and other resources, and with qualified and experienced personnel in adequate numbers, as shall be necessary to accomplish its terms of reference and objectives, as further detailed in the Project Operations Manual. (Section I.A.7 of Schedule 2 to the Loan Agreement) Sections and Description The Borrower shall recruit and retain, or cause to be recruited and retained, such consultants as may be needed to support the functions of the entities referred to in Section I.A. of the Loan Agreement, all with composition and terms of reference acceptable to the Bank and the Borrower as further detailed in the Project Operations Manual. (Section I.A.8 of Schedule 2 to the Loan Agreement) Conditions Type Financing source Description Effectiveness IBRD/IDA The Borrower has adopted the Project Operations Manual, in form and substance satisfactory to the Bank. (Section 4.01 of the Loan Agreement) Page 6 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) I. STRATEGIC CONTEXT A. Country Context 1. The Indonesian economy is showing signs of recovery, but the COVID-19 pandemic and challenging global environment continue to impact development outcomes and livelihoods. The war in Ukraine has seen commodity prices soar and increased the volatility of financial markets globally. Indonesia is projected to undergo a consistent trend of natural disasters resulting in continued economic losses. Annual per-capita gross domestic product (GDP) growth is projected at 5.1 percent in 2022, rising to 5.3 percent in 2023, owing to the release of pent-up demand, improved consumer confidence, and improved terms of trade.1 There have also been reallocations of FY22 subnational budgets to short-term responses for COVID-19.2 However, the anticipated declines in revenue generation and transfers to subnational governments will reduce resources for capital investments in cities, which have been a key stimulus for economic recovery, job creation, and generation of productive assets – also supporting urban resilience to natural hazards and climate change. 2. Indonesia’s frequent exposure to a range of natural hazards, amplified by climate change, makes the country highly vulnerable to shocks, resulting in significant human and economic losses. Between 2012 and 2021, almost 30,000 disasters were recorded in the Indonesia Disaster Data Information database (DiBi). Hydrometeorological events made up 65 percent of recorded disasters over the past 20 years,3 with 60 percent of Indonesia’s districts exposed to a high risk of flooding events. The impacts in urban areas are significant on lives and livelihoods, result in significant damage to infrastructure and the housing stock, and limit access to basic and essential services. For example, estimated damages in Manado from pluvial flooding (related to rainfall) alone were estimated at US$13.6 million in 2016 and are projected to increase to almost US$20 million by 2055.4 3. Indonesia’s urbanization has made the country more prosperous and helped lift millions out of poverty – but the quality and trajectory of urban development is throttling these benefits and increasing disaster risk. Cities are critical for the economic mobility of the poor and aspiring middle class – but they need to be well planned, inclusive, and resilient to function as the drivers for growth and poverty reduction. In 25 years, 68 percent of the country will be living in cities, adding 83 million urban dwellers.5 Cities are not keeping up with the rapid growth (4.1 percent urbanization rate annually), resulting in: sprawling urban areas in increasingly hazardous areas; declining environmental quality; infrastructure gaps; and constrained fiscal and technical capacity for risk-informed development. Poorly planned urban areas have increased risks through the concentration of people and assets, and 1 World Bank, Indonesia Economic Prospects (IEP), June 2022: Financial Deepening for Stronger Growth and Sustainable Recovery (Washington, DC: World Bank, 2022). 2 Ministry of Home Affairs Regulation concerning Guidelines for Preparation of Regional Revenue and Expenditure Budgets for Fiscal Year 2022 (https://peraturan.bpk.go.id/Home/Details/175749/permendagri-no-27-tahun-2021). 3 Based on analysis of statistics from the Centre for Research on the Epidemiology of Disasters Emergency Events Database (EM-DAT). 4 World Bank, Baseline Analysis of Urban Flood Risk in Indonesian Cities: Case Study Reviews and High-Priority Investment Gaps in Ambon, Bima, Manado, Padang, and Pontianak (Washington, DC: World Bank, 2018). 5 World Bank, Indonesia’s Urban Story (Washington, DC: World Bank, 2016). Page 7 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) growing exposure to natural hazards and health-related shocks.6 This risk will increase due to urban population growth and the expansion of settlements in unsafe areas, climate change impacts, and more widespread land subsidence. For example, the increasing risk in Jakarta is a key reason why the government is planning the relocation of the capital to Kalimantan Island. These factors contribute to the data showing urbanization has ‘underdelivered’ in Indonesia (in terms of resilience, growth and poverty reduction) relative to other East Asian countries.7 B. Sectoral and Institutional Context 4. Over the past 20 years, floods have had the greatest impacts on people and assets in Indonesia compared to any other natural hazard – with the poor most at risk. In 2016, floods in Bima forced more than two-thirds of the city to evacuate and caused more than US$65 million in damages, including to hundreds of hectares of agricultural crops, public facilities and buildings, housing, and transport infrastructure. The 2020 floods in the Greater Jakarta Area and West Java displaced more than 25,000 people, damaging more than 37,000 housing units, and hundreds of schools, places of worship, and other public facilities. Flood losses are exacerbated by poor ‑quality infrastructure, which is often constructed in flood‑prone areas with inadequate consideration of flood resilience planning and building codes. The poor and vulnerable often bear the brunt of flood-related disasters as they tend to live in hazardous areas (e.g., densely populated settlements situated below flood levels, coastal areas that experience frequent inundation, and along riverbanks), lack access to basic services and fiscal support, and have limited access to financial resources to cope with the aftermath of losses. In Indonesia, a quarter of the population (76 million people) are located in high-risk flood zones, of which the majority (42.6 million) are poor.8 5. Flood events in Indonesia are becoming more frequent – between 2015 and 2055, the number of Indonesians exposed to river flooding and coastal flooding is projected to increase by roughly 75 percent.9 Metropolitan areas accounted for about half of all recorded disaster-related fatalities between 2003 and 2017, despite being impacted by only one-quarter of all events in the country. Most cities have grown rapidly but organically, without sufficient infrastructure and institutional and technical capacity. Limited trunk and tertiary drainage systems, encroachment on natural wetlands and retention areas, deforestation, watershed degradation, and poor waste disposal practices have exacerbated urban flood risk. Climate change effects, including sea level rise, increasing frequency and intensity of storms, and changing weather patterns, will continue to exacerbate flood risk in Indonesia’s cities. 6. The World Bank is supporting the Government with technical assistance on urban flood resilience; common challenges have emerged despite the diverse city profiles. Participating cities represent different flood-risk, 6 Cities are largely impermeable, so there is limited vegetation or moisture to absorb heat and cool the landscape. Asphalt, concrete and rooftops absorb the sun’s energy during the day and re-release it at night. Additionally, built areas with extensive impermeable surfaces do not soak water naturally into the earth — instead they carry pollutants and biological contaminants into urban waterways, and increase flood risk. 7 Mark Roberts, Frederico Gil Sander, and Sailesh Tiwari, Time to ACT: Realizing Indonesia’s Urban Potential (Washington, DC: World Bank, 2019). The needs for basic infrastructure and services in Indonesia’s urban areas are enormous. A 2015 market assessment of 14 large Indonesian cities estimated an overall subnational infrastructure financing gap of US$11.1 billion. 8 Rentschler, Jun; Salhab, Melda. “People in Harm’s Way: Flood Exposure and Poverty in 189 Countries.” Policy Research working Paper; No. 9447 (Washington, DC: World Bank, 2020). Poverty is defined as those living on less than US$5.50 per day while people living in extreme poverty live on less than US$1.90 per day. 9 World Bank, Baseline Analysis of Urban Flood Risk in Indonesian Cities: Exposure of Indonesian Cities to Disaster Risk (Washington, DC: World Bank, 2019). For river (fluvial) flooding, the at-risk population is projected to increase from 19.2 million to 33.5 million people. Page 8 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) socio-economic, geographic, and urbanization characteristics.10 City selection, which was guided by the Government, targeted cities including outside of Java Island, and particularly small- to medium-sized cities that are urbanizing rapidly but with opportunities for early interventions (versus costly retrofits). These cities have made significant progress in improving flood resilience, such as developing baseline spatial data and maps, engaging in periodic dredging for drainage maintenance, and fostering community involvement in maintenance activities. However, common planning, financing, and technical challenges persist. First, there is an over-reliance on “grey” flood control infrastructure (e.g., pumping stations, traditional drainage channels), which can be cost prohibitive, diminish biodiversity, and have limited flexibility for uncertain futures. Cities could benefit from more investments in “blue-green” approaches.11 Second, there is a need for stronger building codes, compliance and controls on land conversion, and climate risk–informed spatial planning Third, cities are seeing continued drainage issues due to sedimentation, waste blockage, and inadequate design capacities. Planning and design practices and standards need to be adequate for projected needs factoring climate impacts and harmonized with other sectoral and spatial plans. Improved solid waste is important and community participation is key. Finally, most Indonesian cities have limited budgets for investments, maintenance, and operations. 7. Central and subnational governments have increased their investments in traditional flood protection measures,12 and preliminary efforts to reduce vulnerability and strengthen disaster preparedness are showing promise .13 The December 2016 flash floods in Bima did not cause any human casualties because the city had implemented an effective community-based early warning and emergency management system. In Manado, following the 2014 flood events that affected more than 40,000 people, the city responded with flood mitigation efforts and is now investing in the “normalization” of the Tondano River to increase channel capacities; construct the Kuwil dam; revitalize Tondano Lake (including construction of a 9-kilometer dike); and prepare feasibility studies on retention, hydropower, and sediment management. These good practices and lessons learned can be replicated across Indonesian cities to build cross-city and city-level knowledge and capacity, and enhance coordination on urban flood risk management. 8. The institutional and regulatory landscape for urban flood risk management is complex due to the multisectoral nature of flood resilience.14 Structural flood risk reduction measures are typically executed by the Ministry of Public Works and Housing through the Directorate-General of Water Resources and are administered by the River Basin Organizations that are responsible for the respective catchment areas across Indonesia. Current policies focus on an engineering-based basin planning approach, with limited policies for integrated urban flood resilience and blue-green infrastructure approaches. Pluvial flooding is inherently a local issue and consequently the subnational public works agencies (Dinas office) are usually responsible for the construction and maintenance of drainage systems. Responsibilities 10 The technical assistance program included consultations with Ambon, Bima, Jakarta, Manado, Mataram, Medan, Jayapura, Padang, Pekanbaru, and Pontianak. 11 These “blue-green” or nature-based approaches can bring benefits that include greater resilience to floods, lower lifecycle costs, opportunities for recreation and new livelihoods, reduced urban heat island effects, improved community health and well-being, ecological restoration, and enhanced water security and quality. 12 Such as the construction of flood pumping stations, river normalization activities, and drainage improvements. 13 In late 2017, the National Disaster Management Authority (BNPB) launched a “river school” program in selected cities on Java Island and Papua province to build the capacity of community stakeholders to manage river resources sustainably. BNPB also launched a family-based community resilience program (Keluarga Tangguh Bencana, or KATANA) in late 2019. 14 World Bank, Baseline Analysis of Urban Flood Risk in Indonesian Cities: Institutional, Legal Setting, and Flow of Resources for Flood Risk Reduction (Washington, DC: World Bank, 2018). Page 9 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) for non-structural measures are split between numerous agencies at the national and subnational levels.15 Investment coordination across these agencies remains fragmented and city-level policies are needed for integrated solutions. 9. The Government seeks to pivot from past centrally-driven project approaches to urban flood risk management – to a national program approach that is city driven and builds local capacity and a community of practice across institutions. The government is establishing a national program with a menu of structural and non-structural measures to help cities with different flood and climate risks in an integrated manner. This new approach addresses the analytical, technical, institutional, and financial demands of city governments for flood risk reduction. Like other national programs managed by the Government of Indonesia,16 the program will fill a critical sectoral gap and be coordinated at the central level. It will utilize the convening power and technical capacity of the central government to support the execution of activities, while building city-level capacity. This program will therefore serve as a national “umbrella program” to help coordinate sources of financing,17 acting as a platform to continuously advance sector policy, practice, and innovation. In the medium term, the program will encourage the creation of innovative financing mechanisms to incentivize investors and developers to take more responsibility for reducing flood risk and minimizing vulnerabilities to climate change effects, such as sea level rise and increased precipitation.18 By engaging multiple cities concurrently, the program will help build an urban flood resilience community of practice. The national program approach is designed to be pragmatic and help accelerate the delivery of critically important flood investments and planning tools, while having a medium-term strategy to incrementally improve the technical, financing, and implementation capacity of city governments. 10. A national-level program has the advantage of: (i) economies of scale to introduce innovation (technical planning) that cities would not typically have the capacity or resources to avail; and (ii) the ability to help coordinate investments and close the financing gaps at the local level. New spatial planning approaches, such as water-sensitive urban design (WSUD) and investments in integrated urban flood risk management (including green-grey infrastructure) not only save lives and reduce human losses, but also have multiple co-benefits. They create healthy and vibrant public spaces for communities (thereby bolstering overall public health and quality of life), decrease damage to infrastructure and reduce economic losses, and stimulate economic growth.19 To implement this kind of comprehensive approach to managing flood risk, cities must enact cross-sectoral structural and non-structural measures that are designed to cope with climate change. However, budgetary commitments to flood risk reduction are limited. Structural budgetary transfers from central to subnational governments are focused on financing administrative costs and the operation and maintenance of 15 Including the Ministry of Agrarian and Spatial Planning for risk-informed spatial planning in flood-prone land; the National Disaster Management Authority for community preparedness, flood response, and awareness-raising; the Indonesia Meteorological, Climatological and Geophysics Agency for extreme weather monitoring and warnings; the Ministry of Public Works and Housing for compliance with flood-resilience building standards and river flood warnings; and the Ministry of Environment and Forestry for solid waste management and environmental permitting. 16 For example, the National Slum Upgrading Program (KOTAKU), the National Urban Water Supply Program, or the National Affordable Housing Program. Other countries have also established successful national flood resilience programs including Australia, Canada, China, and Singapore. 17 Flood investments by partners include the Flood Management in Selected River Basins Project (Asian Development Bank), Urban Flood Control System Improvement in Selected Cities (Japan International Cooperation Agency), and other urban flood resilience initiatives, such as the proposed Enhanced Water Security Investment Program, Integrated Urban Flood Management in JABODETABEK (greater Jakarta area), and Flood Management and Coastal Protection in North Java. 18 Such financing mechanisms could include, for instance, land value capture instruments that encourage safe development of flood-prone areas and earmarked revenue streams, such as developer levies. Incentivized in this way, developers might take action to reduce flood risk through, for example, better onsite stormwater management (e.g., improved development control policies and robust stormwater management analysis). 19 A. K. Jha, R. Bloch, and J. Lamond, Cities and Flooding: A Guide to Integrated Urban Flood Risk Management for the 21st Century (Washington, DC: World Bank, 2012). Page 10 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) drainage infrastructure, and on project-allocated funds20 to develop specific (and usually small-scale) flood risk management infrastructure. With this somewhat ad hoc financing approach, cities have limited opportunities to develop a holistic and integrated approach to urban flood risk management that focuses on mitigation and long-term resilience, as well as on infrastructure retrofitting and upgrading solutions. 11. Since Indonesian cities have vastly different urbanization and flood risk profiles (as well as capacities), approaches to flood risk management must also vary – and address locally anticipated climate change effects. For example, in Manado, the urban population is growing steadily and urban expansion – particularly the growth in residential developments on urban fringes and along steep hillside slopes – is exacerbating erosion and flooding problems. Pluvial flooding is becoming a significant issue: the past 15 years have seen increasingly heavy rainfall events,21 and new coastal developments (which increase impermeable spaces) not only fail to provide adequate drainage solutions but also block existing drainage lines. Bima, on the other hand, is prone to fluvial floods (from overflowing rivers) and coastal floods (from high sea levels) and has experienced recent upstream land-use changes, including large-scale deforestation. Inadequate solid waste management has led to the obstruction of drainage channels by plastics and large debris, and unsustainable agricultural practices have increased erosion rates. Other Indonesian cities, such as Medan and Gorontalo, have already advanced their urban flood resilience action plans and require further technical studies and investment financing to realize high-priority integrated solutions.22 12. Flood risk analytics and evidence-based urban flood resilience planning are needed to align investments with ongoing and future urban development planning, spatial planning, and flood risk and climate change projections. Many cities need detailed flood hazard mapping that can show inundation depths and return periods (probability) calculated using high-resolution digital terrain models (based on technologies such as Light Detection and Ranging, or LiDAR), hydrological models, and hydro-dynamic models.23 These analytics should also include flood risk maps that highlight potential changes in land use, land subsidence, the effects of climate change (e.g., sea level rise and increased precipitation), and the subsequent impacts on people and assets. Detailed mapping will help cities develop more risk-informed spatial planning and identify flood resilience infrastructure measures that can be implemented in updated drainage master plans.24 Indonesian cities are at different stages of developing integrated urban flood resilience action plans and have flood risk analytics of varying quality and detail. City-specific solutions based on the availability of analytics, urban flood risk profile, and progress on integrated flood risk management are therefore needed. 20 Through the regular APBN/APBD budget, a special allocation fund, or Dana Alokasi Khusus (DAK) or Village Fund (Dana Desa). 21 According to data from the local Indonesian Meteorology, Climatology and Geophysics (BMKG) office. 22 For example, Medan has received support under the Asian Development Bank-financed Engineering Services Project to develop technical designs for priority urban flood resilience investments, while cities such as Gorontalo need additional technical analysis and studies to continue refining their multi-sectoral action plans for integrated urban flood risk management. 23 Hydrological and hydro-dynamic models simulate the discharge process of water flows (from rainfall over river basins) as they are routed to the sea, taking into account the impacts of rainfall intensity, river and drainage infrastructure, tides, storm surges, land use, and climate changes. When these models are calibrating using monitored rainfall, river water levels and discharges, and surveyed terrain levels, they will enable the production of detailed flood hazard maps and enable multiple-scenario analyses that compare the benefits of a variety of flood risk reduction investment options. 24 Mapping should also include environmental considerations and societal needs – such as parks, protected areas, recreation areas, water sources, and cultural heritage sites – and locations of critical infrastructure such as transport nodes, ports, airports, roads, water resources networks, and key buildings. Page 11 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) C. Relevance to Higher Level Objectives 13. The project aligns with the FY21–25 World Bank Group Indonesia Country Partnership Framework (CPF), 25 specifically Objective 4.3 on Strengthening Multi-Hazard Disaster Resilience. Under this objective, three key pillars of World Bank support are helping to develop a comprehensive approach to disaster resilience: (i) disaster risk reduction investments (including this project and other World Bank–financed infrastructure sector investments);26 (ii) financial resilience (including support to establish a catastrophe pooling fund and an adaptive social protection framework);27 and (iii) policy reform and institutional strengthening (through the World Bank’s respective technical assistance engagements). The project will support this engagement by: (i) identifying prioritized multi-year urban flood investments; (ii) supporting urban flood resilience investments with a balance of structural and non-structural measures; (iii) improving flood risk management capacity at national and subnational levels; and (iv) facilitating knowledge management and transfer within and across different levels of government. There are also opportunities for convergence with other World Bank–financed projects, including the National Urban Development Project (NUDP – P163896), to identify potential target areas for green infrastructure investments and capital investment planning needs, as well as complementary nature-based measures financed under the Mangroves for Coastal Resilience Project (P178009). 14. The project will contribute to the Government’s vision of an equitable and prosperous Indonesia and is aligned with the World Bank Group’s twin goals of eliminating extreme poverty and increasing shared prosperity. Flood-related disasters have socioeconomic consequences that go beyond their most obvious impacts and even small shocks can drive vulnerable people into poverty. Ex-ante investments in flood risk reduction will not only save lives and avoid losses, but also improve the quality of urban environments. Investments supported by the project will revitalize local businesses and promote job creation that will be critical for COVID-19 economic recovery; multi-year urban flood resilience plans will also help identify opportunities for private sector participation and investment. The project will also aim to reduce gender gaps in flood risk decision-making processes, integrate climate risk considerations in investment designs, and promote citizen engagement through participatory planning processes. World Bank Group Global Crisis Response Framework 15. The Government of Indonesia has implemented national strategies in response to multiple ongoing crises. Booster vaccinations for COVID-19 began in January 2022 and the rollout has reached a critical mass. The Financial Sector Omnibus Law has also been prepared to support economic recovery from the pandemic. A national Disaster Risk Financing and Insurance strategy is being implemented to better manage fiscal and financial risks resulting from climate-related shocks and natural disasters. In 2022, budget reallocations were needed due to COVID-19 support and dealing with the effects of the war in Ukraine.28 This project will support long-term resilience to help the country prepare 25 World Bank Group, Country Partnership Framework for the Republic of Indonesia for the Period FY16 – FY20, Report 99172 (Washington, DC: World Bank, 2015). 26 The mainstreaming of disaster risk management principles and strategies is being addressed in other national programs, including the National Urban Water Supply Project (P156125) and the Indonesian Mass Transit Program Support (P169548). 27 Disaster Risk Finance and Insurance Project (P173249). 28 World Bank, Indonesia Economic Prospects (IEP), June 2022: Financial Deepening for Stronger Growth and Sustainable Recovery (Washington, DC: World Bank, 2022). Page 12 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) for future shocks through two pillars of the World Bank Group Global Crises Response Framework (GCRF).29 Per Pillar 3: Strengthening Resilience, the project will improve the resilience of participating cities, so they are better prepared for future crises. For example, the project will finance multifunctional open green spaces that could be used for flood management, emergency preparedness (e.g., evacuation and staging areas during health emergencies), and strengthening community health and resilience to non-communicable disease. In addition, integrated measures will strengthen the disaster and climate resilience of cities through a holistic approach. Per Pillar 4: Strengthening Policies, Institutions and Investments, strengthening of city-level stakeholders and risk-informed development control policies for urban flood resilience will enhance the quality of investments to improve long-term preparedness for future crises 16. The World Bank’s adoption of the Green, Resilient and Inclusive Development (GRID) approach promotes economic growth that goes hand-in-hand with environmental goals and social inclusion. The project aligns with the GRID approach by: (i) supporting sustainable investments in urban flood resilience, nature-based solutions, and public spaces that aim to reduce future climate and disaster risk; (ii) safeguarding development from future natural hazards and climate change by adapting cities and urban development; and (iii) including diverse perspectives in the planning and design of project activities, helping traditionally excluded groups realize a fair share of project benefits. II. PROJECT DESCRIPTION A. Project Development Objective PDO Statement 17. The Project Development Objective (PDO) is to: reduce flood risk in select Indonesian cities through increased national and city-level capacities and investments for integrated urban flood risk management.30 PDO Level Indicators 18. Achievement of the PDO will be measured by: a. Target population protected through integrated urban flood resilience measures under the project (number). b. Regulations and/or policies on integrated urban flood resilience adopted by city governments (number). c. City-level interagency urban flood resilience task forces established and functioning (number). d. National urban flood resilience program established with procedures adopted for investment financing, institutional strengthening, and knowledge exchange (yes/no). 19. The results indicators will be disaggregated by gender where relevant. Sub-indicators will be quantified where possible to enhance the effectiveness of project monitoring and evaluation. 29 World Bank Group, World Bank Group‘s Response to the Crises Affecting Developing Countries: Navigating Multiple Crises, Staying the Course on Long-Term Development (Washington, D.C.: World Bank Group) 30 “Integrated” urban flood risk management refers to the continuous process of managing flood risks through combining structural (grey and blue-green measures to keep water away from people) and non-structural (measures to keep people away from water) interventions. This approach brings multiple co-benefits beyond flood risk reduction, including social and environmental benefits. Integrated urban flood risk measures are therefore any combination of these measures implemented in a complementary way. Page 13 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) B. Project Components 20. National program design. This project will support the government to establish and operationalize a national urban flood resilience program. The national program will be a dedicated investment mechanism to reduce flood risk systematically; it will also help to strengthen interagency coordination between various programs and stakeholders to address the multi-sectoral nature of flood risk management and drive city-level engagement. Flood resilience measures will address climate change impacts and be integrated with city-level priorities on urban regeneration and ecological conservation to deliver maximum co-benefits. Participating cities will adopt a “bottom-up,” participatory planning approach in which local stakeholders and diverse population groups can contribute meaningfully during the planning, design, and implementation of project activities. A national-level knowledge and support mechanism will be established to help build capacity and enhance the requisite technical studies, as well as boost public awareness of urban flood risk issues. The project’s interventions are organized under three components: (i) flood risk analytics and planning; (ii) urban flood resilience measures; and (iii) program management and implementation support. 21. Participating cities. The project will support cities that meet the selection criteria agreed between the Government and the World Bank, to be outlined in the Project Operations Manual (POM). Initially, the project will support seven cities: Banjarmasin, Bima, Gorontalo, Manado, Medan, the New Capital City, and Semarang. Some of these cities may be excluded from, and new cities may be added to, the project during implementation in accordance with the selection criteria and procedures specified in the POM. These medium-sized cities were selected by the Government based on the program’s agreed eligibility framework. They represent a mixture of urbanization and flood risk profiles in lagging regions, with varying geographies and landscapes, city scales, flood risk drivers, and urban development challenges (see Annex 2). This focus is aligned with the government’s National Medium-Term Development Plan (Rencana Pembangunan Jangka Menengah Nasional – RPJMN) and the WBG’s CPF to support investments in lagging regions. Activities under Component 1 will support all seven cities, which are strategically significant to the Government of Indonesia. They will inform the implementation of urban flood resilience measures under either Component 2 or other financing sources (i.e., Gorontalo and the New Capital City, or Ibu Kota Negara – IKN).31 IKN is important as a strategic opportunity for the Government of Indonesia to demonstrate a “sponge city” approach as good practice for other Indonesian cities.32 Component 2 will finance the implementation of integrated urban flood resilience measures in at least five cities: Banjarmasin, Bima, Manado, Medan, and Semarang. Component 3 activities will deliver institutional strengthening and capacity-building to enhance the quality of, and returns on, investments in all participating cities; it will also provide support on the establishment and operationalization of the national program, as well as project implementation support. 22. The three project components are summarized below. Annex 2 contains a detailed project description. 31 The National Medium-Term Development Plan (RPJMN) 2020–24 notes 48 cities that have been identified as high-priority cities for the government to address urban flood risk. The list includes Gorontalo, which has already advanced their urban flood resilience action plans. In addition, the RPJMN highlights the importance of the New Capital City to demonstrate a sponge city approach and maximize biodiversity benefits, among other aspects. 32 The sponge city approach could include use of bioswales, rain gardens, multifunctional detention basins, and porous surfaces that take climate change effects into account. Page 14 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Component 1: Flood risk analytics and planning (IBRD: US$45 million) 23. Component 1 will support flood risk analytics and planning, which are needed to align urban flood resilience measures with ongoing and future urban development and spatial planning, and to mitigate the effects of climate change on urban flood risk. This component will provide technical assistance for approximately six cities (Banjarmasin, Bima, Gorontalo, Manado, Medan, and Semarang) to develop technical analysis and flood risk maps that consider various flood risk drivers, such as changes in land use, urbanization patterns, land subsidence, and climate change effects (including sea level rise and increased precipitation). It is expected to enhance the resilience of cities through more accurate and updated disaster and climate risk information for evidence-based investment planning, supporting Pillar 3 of the GCRF. The analytics will inform the development of multi-year and multi-sectoral integrated urban flood resilience action plans that prioritize structural and non-structural measures. This component will also finance technical assistance for IKN including design reviews and technical studies to implement sponge city concepts. 24. Component 1 will be implemented by the River Basin Organizations in the Ministry of Public Works and Housing (MPWH) and support (a) in respect of the cities except IKN: (i) baseline data collection and mapping activities (such as digital terrain models, LiDAR mapping, photogrammetric surveys, and other surveying methods, as well as the monitoring of data such as rainfall, water levels, and discharges for simulation model calibration and validation); (ii) flood risk mapping and modeling (including hydrological and hydrodynamic model development and application, flood forecasting models, and climate change modeling information); (iii) soil subsidence investigations (including how to mitigate subsidence rates that are compounded by climate risk); (iv) other technical studies and assessments (such as socioeconomic assessments, collection of climate change data and information, urban design studies and analytics, and studies to enhance environmental services and protection; (v) development of multi-year and multi-sectoral urban flood resilience action plans; and (vi) feasibility studies, designs, and construction supervision services, and (b) in respect of IKN, (i) technical studies (covering flood risk analysis, asset management for flood control infrastructure, flood monitoring and early warning systems and operation and maintenance), and (ii) design reviews for enhancing concepts for water-sensitive urban design and nature-based solutions to develop a sponge city approach. Component 2: Urban flood resilience measures (IBRD: US$335 million) 25. Component 2 will support the implementation of priority structural and non-structural measures (sub-components 2.1 and 2.2, respectively) included in the multi-year and multi-sectoral urban flood resilience action plans for five cities (Banjarmasin, Bima, Manado, Medan, and Semarang). It will also support priority subprojects that demonstrate immediate impact on flood risk reduction and climate adaptation, while the city-level flood risk analytics and action plans are developed in parallel under Component 1. This component will prioritize the implementation of complementary grey and blue-green structural measures that enhance overall urban resilience outcomes, such as those related to public health and wellbeing, environmental protection, climate adaptation (e.g., green urban “corridors” and restoration of coastal mangroves and wetlands for flood protection), and climate mitigation (e.g., restoration of mangroves and floodplains for carbon sequestration). All subprojects shall meet the government’s standards on energy efficiency, e.g., public space improvements will incorporate climate-resilient landscaping,33 low-energy street lighting, and 33 This could include use of bioswales, rain gardens, multi-functional detention basins, and porous surfaces that take climate change effects into account, as well as other approaches to climate-resilient landscaping where landscapes can continue to provide environmental functions despite climate stresses. Page 15 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) pedestrian footpaths and cycleways to promote low-carbon transport. This component will also support non-structural measures that will help cities and urban communities to mitigate and better prepare for future flood events more systematically through activities including risk-informed spatial planning and development control policies, improved public awareness, modernization of local hydrometeorological systems and instrumentation, and emergency preparedness activities. The component is expected to strengthen the resilience of participating cities through integrated flood management, emergency preparedness, and community resilience measures, supporting Pillar 3 of the GCRF. Vulnerable groups, including women, will participate in training and awareness-raising initiatives to increase their knowledge on flood risk, thus better protecting them from future disasters. 26. Sub-component 2.1 Structural flood resilience measures will be implemented by the River Basin Organizations in MPWH and support: (i) drainage network improvements; (ii) construction of pumping stations, diversion channels, dikes or embankments, and other similar infrastructure; (iii) construction of blue-green infrastructure (including nature-based solutions, green roofs, rain gardens, bioswales, constructed wetlands, rainwater harvesting, infiltration wells, street upgrading, and storage tanks); (iv) river improvements (including dredging, embankment improvements, and other river normalization initiatives); (v) establishment of multipurpose detention or retention parks (that can be landscaped for both recreation and emergency management, e.g., evacuation areas and emergency services staging areas); and (vi) upstream basin stormwater and sediment runoff management (including reforestation, retention basins, land terracing and plantations, and gully plugs). 27. Sub-component 2.2 Non-structural flood resilience measures will be implemented by the River Basin Organizations in MPWH and support: (i) local hydrometeorological system modernization (including the procurement and installation of hydrometeorological monitoring stations, early warning systems, instrumentation, data servers, control rooms, and integration with existing water resource information systems or databases); (ii) preparation and development of risk-informed and environmentally sustainable spatial planning, zoning regulations, water-sensitive urban design guidelines, and building codes; (iii) emergency preparedness activities (including contingency planning, emergency response and evacuation plans, e.g., standard operating procedures), and construction of evacuation routes and shelters; (iv) public awareness campaigns; (v) operation and maintenance plans (including for investments supported under Component 1); (vi) asset management plans for drainage and flood risk management (that could be linked to a broader database of other basic service assets, such as health and education facilities, critical infrastructure, and facilities); and (vii) technical assistance to assess the integration of basic services infrastructure to reduce urban flood risk.34 Component 3: Program management and implementation support (IBRD: US$20 million) 28. This component will help the Government establish and operationalize the umbrella National Urban Flood Resilience Program and support project implementation. The national program will be a multi-city platform that will include communication mechanisms for different stakeholders to exchange knowledge and solutions on integrated urban flood resilience. This component will help build the capacity of project stakeholders on urban flood risk management and improve coordination, data sharing, and knowledge across agencies and between cities. Technical training will support the implementation of activities under Components 1 and 2, including for immediate policy and knowledge gaps such as: risk-informed planning and urban design control policies; climate risk planning, including mitigation measures for urban 34 Investments would be financed under other national programs, such as the National Urban Water Supply Program. Page 16 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) heat islands and water-sensitive urban design; innovative financing mechanisms at the local level; flood risk modeling; and inclusive design for vulnerable population groups. Activities will strengthen policies and institutions for improved resilience to future disasters, particularly through capacity building and outreach initiatives through the national program, as well as support of inter-sectoral and inter-agency institutional coordination through national- and subnational-level taskforces – supporting Pillar 4 of the GCRF. This component will support four sub-components, including day-to-day operating costs. 29. Subcomponent 3.1 on program management will be implemented by the Directorate of Water Resources in Bappenas and support: (i) the establishment and operationalization of the national urban flood resilience program, including strategic studies, advocacy, outreach, and planning and program management; (ii) the establishment and operation of a National Urban Flood Resilience Task Force; and (iii) monitoring, review, and evaluation of the national urban flood resilience program. 30. Sub-component 3.2 on program implementation support will be implemented by the Directorate of Synchronization of Regional Development II in the Ministry of Home Affairs (MOHA) and support: (i) technical assistance for the development of a digital, national-level knowledge management platform on urban flood risk management; (ii) outreach and socialization initiatives with relevant cities, stakeholders, and communities); (iii) interagency coordination and institutional strengthening for integrated urban flood resilience at the subnational level (including for operation and maintenance planning and budgeting, and environmental and social management); and (iv) technical assistance for city-level policy and regulatory reforms for integrated urban flood resilience. 31. Sub-component 3.3 on project management will be implemented by the Directorate of Water Resources Management Systems and Strategy in MPWH and support: (i) day-to-day project management and monitoring, as well as coordination of the Central Project Implementation Unit (CPIU) and National Project Implementation Units (NPIUs); (ii) project reporting, including consolidation of annual work plans, progress reports, procurement, financial management, and contract management; and (iii) audits of social and environmental management. 32. Sub-component 3.4 on project implementation support will be implemented by the Directorate of Rivers and Coasts, the Directorate of Water Resources Engineering Development, and the Directorate of Operation and Maintenance in MPWH and support: (i) day-to-day implementation support of project activities under Component 1 and Component 2 including a technical quality assurance/quality review mechanism; (ii) procurement management, contract supervision, and financial management, including financial and technical audits; (iii) environmental and social risk management (including land acquisition and resettlement planning, citizen engagement mechanisms, grievance mechanisms, community awareness campaigns, and knowledge materials for the training of community volunteers); (iv) development of technical guidelines, standards, and procedures on urban flood resilience; (v) development of integrated flood forecasting and monitoring information systems including a national control room, (vi) enhancement of flood control infrastructure asset management systems; and (vii) technical assistance for integrated urban flood management.35 35Including for operation and maintenance planning and budgeting, flood early warning systems, flood risk management plans, emergency management and business continuity planning for multi-hazard risks, technical analysis and awareness-raising on innovative financing mechanisms (such as land-based fiscal tools and private-public partnerships), and stakeholder and citizen engagement for all project activities, including with at-risk and vulnerable groups. Page 17 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) C. Project Beneficiaries 33. The project will benefit residents in the cities of Banjarmasin, Bima, Gorontalo, Manado, Medan, and Semarang (a total estimated population of approximately 6.3 million36), as well as future citizens of IKN. Component 1 will directly benefit at least 300 city-level government officials and community stakeholders through support on multi-year flood urban flood resilience planning activities. Component 2 activities are expected to benefit approximately 70 percent of the population at risk to flooding in the target cities, or approximately 2.45 million people.37 Activities under Component 3 will benefit at least 500 national- and subnational-level project counterparts. Communities will also benefit from flood risk awareness-raising activities under Component 2. D. Results Chain 34. Problem statement. Rapid urbanization in Indonesian cities and the exacerbating effects of climate change are increasing the intensity of flood hazards and the exposure of people and assets to these hazards. Limited city-level capacity and investments in flood risk management and conventional approaches in “grey” infrastructure are not able to manage the growing flood risk effectively. A dedicated national program is needed to develop integrated technical solutions and offer investment options to strengthen the resilience of participating cities to flood hazards. Local governments need systematic interventions and increased capacity for urban resilience solutions, flood risk governance models, and innovative financing mechanisms. The expected longer-term outcome is that Indonesian cities will be more resilient to floods and, as a result, will be safer and healthier places for citizens. The results chain is outlined in Figure 1. E. Rationale for Bank Involvement and Role of Partners 35. The World Bank has demonstrated experience in supporting clients through investments in integrated approaches to urban flood risk management and developing/scaling up national programs. This includes support for innovative, urban design–based greening solutions. It also includes the provision of technical assistance to inform legislation, improve understanding of flood risk, strengthen institutional coordination and participation, and promote risk-based land-use planning, building codes, and resilient design. The World Bank brings its global knowledge and experience in the above to this project. To share these lessons, a knowledge management platform will be established under Component 3 to disseminate global good practices in urban flood risk management. In addition, the World Bank is in a unique position to help establish a national program in Indonesia, as it has successfully supported several national flagship programs. 38 In addition, the World Bank and Government of Indonesia have been coordinating with other development partners – including the Netherlands, Japan, France, Switzerland, Australia, and the Asian Development Bank, all of which have expressed their support for the national program to coordinate partner investments and address flood risk through an integrated approach. 36 Based on Indonesian Statistics Center population data for 2020 http://bps.go.id 37 Based on National Disaster Management Authority’s risk assessment portal (InaRISK) https://inarisk.bnpb.go.id 38 Including the National Urban Development Project (P163896), National Slum Upgrading Project (P154782), National Affordable Housing Program (P154948), National Urban Water Supply Program (P156128), National Solid Waste Management Program (P159293), and Indonesian Mass Transit Project (P169548). Page 18 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Figure 1: Project results chain Critical assumptions: (i) master plans and urban flood resilience action plans are adopted with legal basis; (ii) integrated investments suit the flood risk profile of the selected cities; (iii) adequate coordination and legal bases are in place. Page 19 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) F. Lessons Learned and Reflected in the Project Design 36. Lessons learned are reflected in the project design. The project design has been informed by national and global lessons learned from the World Bank’s past investments in integrated urban flood risk management, as well as other World Bank–supported national programs in Indonesia, such as the National Slum Upgrading Project (P154782), the National Urban Development Project (P163896), and the National Urban Water Supply Project (P156125). 37. First, the project will combine structural and non-structural flood risk management investments in a single component (Component 2) to promote integration starting from the design stage. Urban flood risk management in Indonesia is a multifaceted issue; it involves solid waste, land subsidence, resettlement, and land use, and requires adaptation to exogenous factors such as climate change. Based on experiences with the Jakarta Urgent Flood Mitigation Project (JUFMP – P111034), these interrelated issues require a holistic approach that combines traditional hard-engineered structural solutions with urban planning, policies, and processes that enhance the sustainability and co-benefits of the proposed investments.39 This integrated approach will also help to maximize biodiversity outcomes through integrated green and blue flood management solutions. Lessons learned from other World Bank engagements in the region and Indonesia40 include the need to specify the adequate landscape and plant species to suit the microclimate, ensure continuous ecological connectivity, and adopt adequate long-term operation and maintenance (O&M) plans. The design and implementation of nature-based solutions will draw from World Bank guidelines and experience, where emphasis is placed on considering essential principles and processes. The processes entail aspects such as understanding the problem and setting objectives, addressing the financing needs, critically evaluating the costs and benefits of the options, and once implemented, continuing to maintain and monitor performance.41 38. Second, the proposed institutional arrangements will help champion sustained institutional change. The implementing agency for the structural and non-structural measures has stakeholder buy-in and a mandate conducive to shifting institutional approaches to urban flood resilience. Like the National Urban Development Project, this project would leverage interagency coordination between Bappenas – which chairs the Steering Committee for Water Resources Management – and the urban flood resilience task forces at the national and city levels, to promote effective collaboration across sectoral agencies and with affected communities.42 While this project will be implemented by central-level agencies, cities will have significant coordination and decision-making responsibilities through the city-level task forces, with technical and financial support from central-level agencies under Component 3. More time is needed to enact transformational changes to institutional arrangements for integrated urban flood resilience. 39. Third, the project design builds on a baseline analysis established as part of an ongoing technical assistance program and informed by the needs and capacities of 30 Indonesian cities. The baseline helped to formulate a national-level conceptual framework for implementation and identified city-level investment needs based on an 39 World Bank, Jakarta Urgent Flood Mitigation Project / Jakarta Emergency Dredging Initiative (JUFMP/JEDI, P111034) – Implementation Completion and Results Report (Washington, DC: World Bank, 2020). 40 These include the Mangroves for Coastal Resilience Project (P178009) and lessons learned from Singapore’s Active, Beautiful, Clean Waters Programme – that were shared with the project counterparts during knowledge exchanges supported by the World Bank’s ongoing technical assistance program for urban flood resilience. 41 World Bank. 2017. Implementing nature-based flood protection: Principles and implementation guidance. Washington, DC: World Bank 42 World Bank, National Urban Development Program (NUDP, P163896) – Project Appraisal Document (Washington, DC: World Bank, 2019). Page 20 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) integrated approach to flood risk management. It also identified lessons learned from Indonesian cities around, for instance, preparedness and response to urban flood disasters. For example, although flash floods in Bima during December 2016 disrupted economic activity for almost a week and displaced over two-thirds of the population, there were no human casualties. This was largely due to the city’s strong disaster preparedness capacities, supported by a community-led volunteer program. The 630 residents comprising the volunteer corps helped communicate disaster risks from upstream to downstream areas; managed emergency response logistics; and collected data to assist recovery efforts. The knowledge platform supported by this project will share such good practices with other cities. 40. Finally, urban flood risk management projects in Haiti and Vietnam43 have demonstrated the need for community participation throughout the project lifecycle. Experience has shown that involving the community in the planning, design, and implementation process can help improve the sustainability of infrastructure investments because the investments better address local needs and priorities. Accordingly, this project will ensure that the communities participate and are consulted throughout project implementation, and it will help instill in the communities a sense of ownership over the infrastructure. This is expected to contribute to better long-term maintenance and management. III. IMPLEMENTATION ARRANGEMENTS A. Institutional and Implementation Arrangements 41. Project coordination. A National Urban Flood Resilience Task Force will be established to enhance cross-sectoral and interagency coordination. The national task force will be responsible for providing strategic oversight, coordinating urban flood resilience investments across sectors and agencies, and reviewing and approving the multi-year and multi-sectoral urban flood resilience action plan for each city. The task force will be chaired by Bappenas and comprise officials from relevant ministries and agencies.44 It will report to the existing Steering Committee for Water Resources Management, which is led by Bappenas and has a membership similar to the National Urban Flood Resilience Task Force. 42. City government roles. Each of the cities supported under the project (except IKN) will establish a City-level Urban Flood Resilience Task Force, which will include local government representatives from relevant agencies and non-government representatives as appropriate (e.g., private sector stakeholders, civil society representatives, university/academia, etc.). While the city governments are not responsible for implementation or contract management under this project, the city-level task forces will coordinate with the respective implementation teams and the national task force and provide strategic and technical guidance on integrated urban flood resilience planning, subproject prioritization, and subproject implementation (including reviews of technical designs and environmental and social instruments).45 They will also be beneficiaries of capacity building and training activities under Component 3. 43 The Municipal Development and Urban Resilience Project (P155201) and the proposed Vinh City Priority Infrastructure and Urban Resilience Development Project (P174157). 44 These ministries and agencies will include: MPWH; MOHA; the National Disaster Management Authority (BNPB); Ministry of Finance (MOF); Coordinating Ministry of Economic Affairs; National Land Agency/Ministry of Agrarian Affairs and Spatial Planning; Indonesian Agency for Meteorology, Climatology and Geophysics; Ministry of Environment and Forestry; and Ministry of Agriculture 45 The city-level task forces are crucial to enhancing inter-agency governance arrangements, investments, and capacity building for urban flood risk management in Indonesian cities. They will be established formally through a Mayor’s decree or similar. Although city-level agencies will not be Page 21 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) 43. Project implementation. The project will be implemented by three central-level ministries – MPWH, MOHA, and Bappenas – with the Directorate-General of Water Resources (DGWR) under MPWH acting as the Executing Agency (EA). The project will support establishment and operationalization of the national urban flood resilience program through the Directorate of Water Resources (Bappenas) as a NPIU for Sub-component 3.1 and the Directorate of Synchronization of Regional Development II under the Directorate-General (DG) of Regional Development (MOHA) as a NPIU for Sub-component 3.2. The Directorate of Water Resources Management Systems and Strategy (DGWR, MPWH) as the Central Project Management Unit (CPMU) under Sub-component 3.3 will be responsible for overall project management, including consolidating the annual work plans from the CPIU, NPIUs and Project Implementation Units (PIUs). The Directorate of Rivers and Coasts (DGWR, MPWH) will be the CPIU and responsible under Sub-component 3.4 for day-to-day project implementation support of Components 1 and 2. The Directorate of Operation and Maintenance and Directorate of Water Resources Engineering Development will provide technical guidance and support during project implementation as a unified NPIU (comprising both directorates) under Sub-component 3.4. The relevant River Basin Organizations (Balai Wilayah Sungai/Balai Besar Wilayah Sungai, or BWS/BBWS) in MPWH will be the PIUs for Components 1 and 2 in the selected cities. 44. The CPMU will be supported by a Project Management Consultant under Component 3. The central-level implementation team will be supported by a Technical Management Consultant for the Directorate of Rivers and Coasts under MPWH (under Component 3), which will provide implementation and technical assistance support, as well as technical consultants for the Directorate of Water Resources Engineering Development and the Directorate of Operation and Maintenance under MPWH (under Component 3), and relevant technical and project management consultants for Bappenas and MOHA (under Component 3). The BWS/BBWS will be supported by a Project Implementation Support Consultant for each city to support technical assistance, design, construction management, and supervision services. 45. Citizen engagement will inform flood risk planning decisions and is critical to successful implementation of the project. Community and diverse population group stakeholders such as people of all abilities, ages, and genders will inform the planning and design of flood resilience investments through participatory planning approaches (such as interactive and accessible design workshops); they will also contribute to and benefit from the knowledge resource centre and training activities. Other forms of citizen engagement will include a transparent and project-specific feedback and grievance redress mechanism, communication campaigns and capacity building, and the development of risk management processes and engagement required under the World Bank’s Environmental and Social Framework (ESF). 46. Consultations with citizen groups and relevant stakeholders were organized by the city governments during project preparation and included design workshops to review and prioritize urban flood resilience measures. The project will continue supporting participatory planning approaches under Components 1 and 2 during the detailed design and implementation of subproject activities. Citizen engagement will be institutionalized under the national program starting from analytics, through to planning, design and implementation, and continuous O&M and awareness raising. The responsible for implementation under this project, the city-level task forces will play a major role in the development and establishment of multi-year investment plans, and will be required to provide guidance on designs and environmental and social instruments, identify operation and maintenance strategies (and financing), and participate in institutional strengthening activities under Component 3. The objective is to develop the capacity of city-level stakeholders to implement integrated urban flood resilience measures in the longer term. Further detail on the roles and responsibilities of the city-level task forces will be included in the POM. Page 22 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Project’s Stakeholder Engagement Framework (SEF) sets out the agreed engagement and outreach opportunities while city-level Stakeholder Engagement Plans (SEPs) will be developed during implementation. Citizen engagement will be measured through reporting on implementation of the SEPs as well as the percentage of beneficiaries who report that project investments reflect their needs, to be evaluated before project closing (see Results Framework – Section VII). B. Results Monitoring and Evaluation Arrangements 47. The Results Framework (Section VII) and Monitoring and Evaluation (M&E) arrangements set out in this PAD form the basis for monitoring implementation progress toward the PDO. The CPMU will be responsible for coordinating M&E inputs from the CPIU, NPIUs and PIUs. Within the first six months of project commencement, a digital M&E system that tracks the project’s implementation status will be established, enabling all project results to be recorded virtually. The system will be maintained by MPWH under Component 3, which will be responsible for collecting the required data, disseminating guidelines and operation manuals, setting up the monitoring system, and reporting the results through project progress reports. Technical support and training on the M&E system will be funded under Component 3. Information and data collected by MPWH on implementation pace, efficiency, due process, procurement performance, and construction quality will feed into the M&E system to help monitor the project’s outcomes and impacts. 48. M&E will be conducted via periodic monitoring through semesterly reports that track progress in terms of distribution of inputs, disbursement of funds, and achievement of targeted indicators as outlined in the Results Framework. The World Bank will conduct regular implementation support missions every six months; where feasible, each project report will be submitted to the World Bank two weeks in advance of these missions. Each report will be reviewed by the National Urban Flood Resilience Task Force in a manner to be set out in the POM. The POM will include a project report template that sets out key information to be included in each report and the modality for finalization after the report has received the relevant clearances. 49. To evaluate Component 2 activities, a comprehensive beneficiary impact survey will be conducted in each city approximately six to 12 months before the last sub-project activity is completed. A midterm review (MTR) of project implementation will take place at the mid-point of project implementation. C. Sustainability 50. Operation and maintenance (O&M). Adequate O&M planning and budgeting will be one of the key criteria for subproject prioritization. This is essential for nature-based solutions, conventional flood control infrastructure, and non-structural measures such as hydro-meteorological systems. Each participating city’s multi-year urban flood resilience action plan will define the O&M plan, including budget needs, for each of the agreed measures under the project. An O&M plan shall be required for each subproject at the planning and design stage. The PIUs will be required to prepare O&M plans, to be included in the scope of related civil works contracts, and to coordinate further with the Directorate of O&M in MPWH for implementation aspects. Local governments (through the city-level task forces) will be required to identify the necessary budget and adequate plans for long-term O&M and may explore alternative financing opportunities with developers, communities, and the private sector (e.g., corporate social responsibilities, developer incentivization schemes, levies, etc.). They may be assisted in these efforts by the knowledge management platform and Page 23 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) capacity building activities under Component 3 that will assist the cities to plan and budget for O&M, as well as design asset-specific O&M plans. 51. Government commitment and ownership. The need to strengthen the resilience of cities to disasters (for floods in particular) is recognized in the Government’s RPJMN 2020-2024, specifically under the fifth development agenda: Strengthening Infrastructure to Support Economic and Basic Services Development. The RPJMN highlights the importance of integrated programs for urban flood management with a combination of structural and non-structural measures, while promoting blue-green infrastructure development. Cities are responsible for strategic and technical coordination to support implementation through the city-level urban flood resilience task forces. The project will provide opportunities to assess governance and institutional arrangements and improve implementation models. 52. Infrastructure sustainability. Long-term sustainability of project interventions will require: (i) adequate quality control in construction and incorporation of resilience-strengthening standards in infrastructure design; and (ii) design and construction of infrastructure that is suitable to local conditions and acceptability. All assets in the project will be designed with improved engineering standards, in accordance with the Government’s relevant building codes, and construction regulations, utilizing good practices to improve the long-term sustainability of infrastructure investments. Expert engineering technical assistance, technical audits, and onsite construction monitoring support will help enhance building quality and extend the durability of infrastructure. 53. Capacity building activities will be developed to enhance the institutional capacity of technical staff, ensure that they receive adequate training on incorporating ‘build back better’ principles in infrastructure design, and support the O&M of critical public assets. A training assessment will be carried out in the first 18 months of the project implementation period to develop a strategic training plan that can address potential technical gaps in implementation units. IV. PROJECT APPRAISAL SUMMARY A. Technical and Economic Analysis Technical 54. The design of flood risk management approaches in the selected cities builds on the thorough, evidence-based technical assistance implemented since 2018 and financed by the World Bank. Technical recommendations for the national urban flood resilience program were supported through a technical assistance program under the Urban Floods, Disaster Risk Management, and Drainage Program (P156711). The Program supported a baseline analysis of 30 Indonesian cities and the development of a conceptual framework design for the national program, with financial support from the Indonesia Sustainable Urbanization Multi-Donor Trust Fund (financed by the Swiss State Secretariat for Economic Affairs). City stakeholders from 10 local governments helped to inform the national program design. Urban flood resilience diagnostics laying out potential investment options in Bima, Manado, and Pontianak were then developed with financial support from the Japan–World Bank Program on Mainstreaming Disaster Risk Management in Developing Countries through the Global Facility for Disaster Reduction and Recovery (GFDRR). The technical assistance program has already helped to build national and subnational capacities, relationships, and processes for the integrated approach. Page 24 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) 55. The flood risk analytics supported through Component 1 will provide selected Indonesian cities with an extensive knowledge base from which they can develop long-term integrated and strategic plans, focusing on technical issues and institutional or governance matters. The project will support detailed flood hazard and risk mapping using high-resolution digital terrain models, which will provide city planners and residents with a thorough understanding of the likelihood and spatial distribution of flood extents, depths, and impacts. These maps will consider a range of mechanisms (particularly climate change) that exacerbate floods, including sea level rise, land-subsidence, and extreme precipitation and river discharges. The project will advocate for an evidence-based and multidisciplinary approach— incorporating flood risk engineering, risk-informed urban design, and stakeholder participatory planning—to develop the multi-year urban flood resilience action plans. This methodology was already piloted in Bima and Manado through the World Bank’s technical assistance program. 56. Component 2 enables cities to address the root causes of flooding and their impacts through a balanced selection of flood risk management options. Previous investments have prioritized traditional engineering approaches that in some cases have created long-term negative impacts. Cities are facing the impact of rapid urbanization and changes in the patterns of extreme weather events, and it is crucial to leverage investment financing to reap co-benefits (such as urban revitalization, environmental protection, and community well-being). The project gives a high priority to WSUD and blue-green infrastructure approaches, such as the design of multifunctional public spaces and the development of standards to guide new developments. These measures, if well designed and implemented, have the potential to bring multiple benefits beyond flood risk reduction. They include reduced lifecycle costs, ecological restoration and connectivity, improved community well-being, recreation and livelihood opportunities, other climate benefits including mitigation and reduction of heat island effects, and improved water security. The balancing of structural and non-structural measures, integrated with green and blue infrastructure, is aligned with international good practice. 57. The five cities supported under Component 2 have already identified priority subprojects to be implemented in the first 18 months of the project, i.e., investments that have clear and demonstrated effectiveness in reducing urban flood risk, and do not require land acquisition. These include drainage infrastructure upgrading, dredging works, tidal gates, street and riverfront upgrading works, awareness activities, policy and plan development, technical studies and preparatory technical work. The project promotes a pragmatic approach for subproject readiness with indicative subprojects identified for each city and advance procurement initiated during preparation. 58. The project will finance innovative information and communication technology (ICT) tools for urban flood risk analysis and monitoring, and support digitalization of the operational aspects for project monitoring and evaluation, as well as knowledge sharing and awareness-raising of risks. For example, Component 3 is establishing a digital knowledge platform for urban flood risk management while the digitalization of flood risk models and asset registers will be supported under Component 1. These practices will help Indonesian cities to make more accurate and evidence-based decisions on flood resilience measures, and facilitate cross-knowledge sharing of innovative practices and policies. Economic Analysis 59. Approach and methodology. An evaluation of the project was conducted to assess its soundness from a general economic standpoint, by identifying and quantifying streams of costs and benefits attributable to the project components. This cost-benefit analysis estimates the economic internal rate of return (EIRR), the net present value (NPV), Page 25 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) and the benefit cost ratio (BCR) of the project. The expected benefits and costs are quantified in terms of monetary value and analyzed using different methodologies. Total costs used in the analysis consist of investment costs (entire project costs) and project O&M costs. 60. The expected benefits considered for this analysis are avoided asset losses and avoided economic losses based on Regional Gross Domestic Product (RGDP) under a “high” hazard classification for disaster risk impact scenarios, as per BNPB’s calculation of risks and hazards for various disasters in Indonesia.46 The total asset value of houses, public facilities, and critical facilities is calculated based on the hazard class in the affected area. The economic losses or economic vulnerability consist of parameters for the contribution of GRDP and productive land. The value of productive land (such as in the agricultural sector) is calculated based on the value of the GRDP contribution in sectors related to productive land. 61. Results of key data and parameters. The results of the cost-benefit47 analysis for the five cities supported under all three components (Banjarmasin, Bima, Manado, Medan and Semarang) are presented in Table 2 for a duration of 10 years from project inception. The NPV is USD380.9 million, indicating the project will produce positive net economic benefits in the future. In addition, the EIRR calculated is substantially higher than the discount rate of 10 percent and the BCR is greater than 1. Thus, the analysis suggests that the project offers strong economic viability and is a robust investment that will benefit the target communities in the selected cities. Table 2: Cost-benefit results Key ratios Total project cost USD400 million O&M costs (% of investments) 10% Discount rate 10% Period 10 years Exchange rate (for BNPB’s benefit 1USD = IDR15,589 conversion) Net Present Value (NPV) (USD millions) 380.9 Economic Internal Rate of return (EIRR) 24.4% Benefit Cost Ratio (BCR) 1.65 62. A sensitivity analysis of the project’s net benefit was conducted for several indicators with respect to the change in total project costs (i.e., investments and O&M costs). The sensitivity analysis shows that results are not sensitive to the change in costs, except in the extreme case where the costs increase by more than 50 percent (see Table 3). The sensitivity analysis serves to strengthen the projected economic feasibility of the project and the potential for positive 46 BPNB produced three hazard classifications: low, medium, and high. The assumption is that the high hazard classification has 100% effect or total damage on the asset value and economic activities. The classification follows a 2016 flood disaster risk assessment report (BNPB, “Indonesian Disaster Risk” (Jakarta: BNPB, 2016)). 47 The benefits reflect the projected monetary values of assets, and social and economic activities identified by BNPB in its 2016 flood disaster risk assessment report (BNPB, “Indonesian Disaster Risk” [Jakarta: BNPB, 2016]). Therefore, benefits would be substantially higher when direct co-benefits are considered. Page 26 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) impacts from the project on the selected five cities. Hence, the project is desirable and yields substantive economic benefits during the 10-year period of analysis. Table 3: Results of Sensitivity Analysis Cost Sensitivity Key Ratios -30% -20% -10% Baseline 10% 20% 50% NPV (USD, millions) 563.94 503.58 442.56 380.87 318.53 255.52 62.54 EIRR (percent) 36.67 31.90 27.87 24.40 21.34 18.61 11.83 Benefit-Cost Ratio 2.40 2.08 1.84 1.65 1.49 1.36 1.07 B. Fiduciary (i) Financial Management 63. Arrangements: The project’s budgeting system follows existing government procedures. The project budget will be included in each line ministry’s annual budget document (known as the Daftar Isian Pelaksanaan Anggaran – DIPA). The CPMU will monitor the DIPA allocation under each CPIU/NPIU/PIU to ensure that budget is available for project activities during the project period. The project will support the hiring of a Financial Management (FM) Consultant to assist the CPMU with meeting the World Bank’s financial management requirements, including monitoring DIPA availability under each CPIU/NPIU/PIU, timely reporting to the World Bank, managing the replenishment process, and following up on audit findings. The FM Consultant will support the CPMU to prepare Interim Unaudited Financial Reports (IFRs) and ensure that payment remittances (Surat Perintah Pencarian Dana, or SP2D) are complete for all CPIU, NPIUs and PIUs. The project will submit quarterly IFRs and prepare annual financial reports based on the IFRs, along with the Notes to Financial Statements. The project will be audited by the Supreme Audit Board of the Republic of Indonesia (Badan Pemeriksa Keuangan, or BPK) and the audit report should be made available to the World Bank no later than six months after the end of each fiscal year. 64. Risks. Based on the FM assessment, the FM residual risk after mitigation measures is rated as “Moderate.” There are potential risks concerning the adequacy of the project’s annual budget under the DIPAs and the verification of payments. Budget availability may depend on the total budget allocation that MOF makes available to the line ministries. It is unlikely that adequate budget will be available at the beginning of the year, and the project may need to process DIPA revisions. The CPMU will monitor the DIPA allocation under each PIU to ensure adequate allocation is available every year during the project’s implementation. The FM Consultant will assist the CPMU to gather budget needs and availability from each PIU. In terms of payment verification, audits have previously found weaknesses at the central level, which have been noted in previous World Bank-financed projects; this is an even greater concern at the provincial and city levels. The project will establish an agreement, to be included in the POM, on all valid supporting documents required for the different types of expenditures. The CPMU will arrange trainings to ensure that the CPIU and all NPIUs and PIUs comply with the POM. 65. Disbursement arrangements. The applicable disbursement method will be: (i) “advance”; (ii) “direct payment”, and (iii) “reimbursement”. The Special Commitment method is not anticipated under this project. The DG of Treasury (MOF) in Bank Indonesia (Central Bank) will open a segregated Designated Account (DA), denominated in US dollars, solely to Page 27 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) finance eligible expenditures for this project. The ceiling of the advance to the DA will be variable, and the advance(s) will be made based on the six-monthly projected expenditures. Reporting on the use of the DA funds will be based on the quarterly IFRs, which should be submitted to the World Bank no later than 45 days after the end of each quarter. Applications for an advance to the DA will be submitted together with the reporting on the use of DA funds.48 Claims will be made based on actual SP2Ds issued by the State Treasury offices. All documentation for expenditures as reported for disbursements will be retained at the implementing units and made available to the auditors for an annual audit and to the World Bank and its representatives, if requested. 66. The DGWR of MPWH will be responsible for reconciling the DA and preparing separate applications for the withdrawal of reimbursements and advances, duly approved by the DG of Treasury, before their submission to the World Bank. Copies of DA bank statements will be provided to the CPMU by the DG of Treasury under MOF, which will authorize its relevant Treasury Offices (Kantor Pelayanan Perbendaharaan Negara, or KPPNs) to approve payments of eligible project expenditures by issuing SP2Ds. For this purpose, the DG of Treasury shall issue a circular letter to the relevant KPPNs, providing guidelines and criteria for eligible project expenditures in accordance with the loan agreements. When expenditures are due for payment, the CPMU, CPIU, NPIUs and PIUs will prepare payment requests for the payment officer within the Working Unit (SatKer). After document verification, the payment officer will issue payment orders together with supporting documentation for submission to the relevant KPPN. The KPPN will check the budget eligibility and issue the SP2D to the KPPN’s operational bank, which transfers the funds directly to the payee’s account and arranges for debit of the loan portion in the DA. Bank financing of the project is 100 percent inclusive of taxes, and counterpart funds are expected to cover land acquisition and resettlement costs, as well as O&M of assets financed under the project. There is no provision of retroactive financing under the project. All categories of expenditure – goods, works, consulting services, training and workshops, and incremental operating costs – will be financed at 100 percent within the loan amount of US$400 million. (ii) Procurement 67. Applicable procurement regulation. Procurement under this project will follow the procedures specified in the World Bank Procurement Regulations for IPF Borrowers dated November 2020 (Bank’s Procurement Regulation s) and the provisions stipulated in the Loan Agreement and approved Procurement Plan. The project will be subject to the World Bank’s Anticorruption Guidelines, dated October 15, 2006, revised in January 2011, and as of July 1, 2016. The project will use the Systematic Tracking of Exchanges in Procurement (STEP) to plan, record, and track procurement transactions. 68. Use of National Procurement Procedures. All contracts for goods, works, and non-consulting and consulting services to be procured in line with the national market approach shall follow Indonesia’s national procurement procedures , established to follow Presidential Regulation (Perpres) No. 16/2018 and amendment Perpres No. 12/2021, subject to the conditions that are included in the Procurement Plan. These procedures are broadly consistent with the requirements of the World Bank Procurement Regulations, Section V, Paragraph 5.4, National Procurement Procedures (subject to a few conditions specified in the Project Procurement Strategy for Development (PPSD) and in the Procurement Plan). 69. PPSD and Procurement Plan. The PPSD includes detailed assessments of the market for goods, works, and services 48This will consist of: (i) IFRs and a list of payments for contracts under the Word Bank’s prior review; (ii) projected expenditures for six months; and (iii) the DA reconciliation statement. Page 28 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) required for project implementation; procurement approaches; and procurement risk analysis along with the proposed risk mitigation measures. The Procurement Plan will be updated at least annually or as required during project implementation to reflect any substantial changes in procurement approaches and methods to adapt to implementation needs, market fluctuations, and improvements in institutional capacity. The updated Procurement Plan, along with the revised PPSD, will be subject to the World Bank’s prior review and approval. The procurement activities under the project are expected to be: (i) individual consultants to support the project implementation; (ii) consulting services (e.g., project management consultants and design and supervision consultants); (iii) civil works; and (iv) goods. 70. Procurement capacity and risk assessment. MPWH, Bappenas and MOHA will carry out procurement and contract management under the project. All ministries have prior experience in implementing World Bank–funded projects following procurement guidelines. Based on the assessment and the project’s procurement profile, the procurement residual risk, after mitigation measures, is rated as “Substantial.” Details for procurement arrangements are in Annex 1. .C. Legal Operational Policies . Triggered? Projects on International Waterways OP 7.50 No Projects in Disputed Areas OP 7.60 No . 71. None of the investments financed by this Project will use or risk polluting international waterways. D. Environmental and Social 72. Environmental and social (ES) risk. The World Bank’s due diligence assessment of the project’s potential environmental and social risks and impacts is included in the project’s Appraisal Environmental and Social Review Summary (ESRS). The combined environmental and social risk for the project is rated ‘High’, with environmental risk assessed as ‘Substantial’ and social risk as ‘High’. The social risk level was guided mainly by sub-components and activities pertaining to, but not limited to, structural and non-structural measures and civil works activities in the selected cities; anticipated land acquisition (voluntary and nonvoluntary), which could include resettlement; and flood awareness-raising activities involving local communities, primarily under Component 2. The environmental risks will arise mostly from activities under Component 2 and relate to the impacts of civil works and management of materials in urban areas; disposal of dredged material of presently unknown quality; general construction waste management; preservation and improvement of existing, already limited/degraded biodiversity in urban areas; and the positive impacts of improved water regime through application of the sponge city approach. Project activities, if appropriately designed, implemented and monitored, are unlikely to have significant impact on the environment. The environmental risks will be of site specific, low to medium magnitude, mostly confined to civil works during execution, with the respective impacts being predictable, manageable by application of standard construction techniques, reversible, and with only temporary potential negative impacts. The ES approaches detailed in the project’s ES instruments include measures to mitigate ES risks proactively, as well as measures to maximize social inclusion and biodiversity effects of integrated urban flood resilience in the selected cities. 73. The main social risks of Component 1 include lack of substantive consultation and the exclusion of local populations, especially marginalized communities, from multi-year flood resilience planning and decision-making processes. Page 29 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Inadequate engagement and targeting of these groups could lead to their exclusion from project benefits or even loss of livelihoods. There is also a risk that insufficient coordination between planning at the national, provincial, and city levels may exacerbate existing environmental and social concerns. Environmental and social risks related to Component 2 will mostly be associated with physical factors during the implementation of civil works. They include land acquisition and livelihood loss, handling of potentially contaminated sediment produced by dredging activities, construction material and waste management, fuel and oil management, traffic safety and security for works in densely populated areas, noise, vibration, dust, labor-related risk, community health and safety risks – including sexual exploitation and abuse/sexual harassment (SEA/SH) risks – and, to a smaller degree, general land and water pollution. Under Component 3, the social risks include lack of meaningful engagement with key stakeholders and failure to include all relevant stakeholders, which may hamper capacity development and knowledge management across sectoral agencies. 74. Relevant Environmental and Social Standards (ESSs). An assessment of the project scope and components confirmed that all but one ESS under the World Bank’s Environmental and Social Framework (ESF) are relevant for this project. The relevant ESSs are: ESS 1 Assessment and Management of Environmental and Social Risks and Impacts; ESS 2 Labor and Working Conditions; ESS 3 Resource Efficiency and Pollution Prevention and Management; ESS 4 Community Health and Safety; ESS 5 Land Acquisition, Restrictions on Land Use and Involuntary Resettlement; ESS 6 Biodiversity Conservation and Sustainable Management of Living Natural Resources; ESS 7 Indigenous People/Sub-Saharan African Historically Underserved Traditional Local Communities; ESS 8 Cultural Heritage; and ESS 10 Stakeholder Engagement and Information Disclosure. ESS 9 Financial Intermediaries is not currently relevant. 75. ESS1: Assessment and Management of Environmental and Socials Risks and Impacts. The Borrower has developed an Environmental and Social Management Framework (ESMF) as an overarching instrument to guide project implementation. The ESMF: (i) provides a framework to screen and determine relevant environmental and social risks; (ii) describes legal and institutional settings and responsibilities; (iii) specifies the processes and scope of Environmental and Social Impact Assessments as per government and World Bank requirements; (iv) determines measures and processes for preparing site-specific Environmental and Social Mitigation Plans (ESMPs) for the design, construction, and operational phases of various investments; (v) describes institutional monitoring and reporting arrangements; and (vi) describes the institutional arrangements in respect of non-compliance with processes presented in the ESMF. The ESMF includes Labor Management Procedures (LMP) and an Indigenous Peoples Planning Framework (IPPF). The Land Acquisition and Resettlement Policy Framework (LARPF) has been prepared as a standalone instrument. The project has also developed a SEF, which lays out an engagement strategy and planned activities to guide stakeholder consultations. The ESMF was disclosed on the Bank’s website on June 30, 2022 and the Environmental and Social Commitment Plan (ESCP) and the SEF were disclosed on June 24, 2022. 76. ESS2: Labor and Working Conditions is relevant because different types of workers will be involved during project implementation. As part of the ESMF, a LMP has been developed to regulate project-related labor and working conditions. The LMP provides information on relevant laws and regulations, identifies labor risks and relevant mitigation measures, and sets out institutional arrangements. It includes a monitoring and evaluation plan, a Feedback and Grievance Redress Mechanism (FGRM) for project workers, and provision for contractors to develop a Contractor ESMP (C-ESMP) in line with the LMP. 77. ESS3: Resource Efficiency and Pollution Prevention and Management. The most significant direct impact related to ESS3 will arise during implementation of Component 2 activities and will result from the implementation of structural and nonstructural measures broadly separated into “grey” and “green” infrastructure. Potential negative impacts related Page 30 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) to inadequate categorization, use and/or disposal of dredged material will be managed through sediment (batch) testing before commencement of the dredging works and, in case of the presence of pollutants, disposal at purpose-designated and prepared site(s). General waste, wastewater and construction waste management will be the responsibility of the contractors, in line with the well-established national construction standards. Impacts from these activities and the respective standard mitigation measures are detailed in the ESMF and will be elaborated in the C-ESMPs, as relevant. The project emphasizes re-use and re-cycling of the existing natural materials wherever possible – soil, clay, sand, and gravel – and mandates use of good engineering practices and the application of energy efficient techniques. 78. ESS4: Community Health and Safety. The project is expected to indirectly improve overall community and public health through the development of multifunctional green public spaces. Nevertheless, potential risks to community health and safety may arise from site-specific activities – for example, risks may arise related to infrastructure construction or to post-construction concerns such as poor-quality infrastructure. There may also be risks related to the improper disposal of dredging materials and other construction waste, increased traffic, and the potential for SEA/SH of local community members, particularly in construction sites. These risks will be assessed at the site level during implementation in an Environmental and Social Impact Assessment document; the risk mitigation measures, and the plan will be detailed in the ESMP. 79. ESS5: Land Acquisition, Restrictions on Land Use and Involuntary Settlement. The project’s approach is to avoid involuntary land acquisition and resettlement to the greatest extent possible. However, considering the types of activities supported under Component 2, involuntary land acquisition and resettlement may be unavoidable. Some of the project activities may be implemented in the upper catchments of the participating cities, where protected areas do exist. When a subproject may be implemented in protected areas, locations with prior land use and locations that could restrict access to sources of livelihoods will be excluded. The project has developed a LARPF which specifies the principles, requirements, and procedures for identifying risks and impacts due to land acquisition and resettlement that may take place, and social assessments and requirements for preparing sub-project level Land Acquisition and Resettlement Action Plans (LARAPs). The project will adhere to the LARPF and technical capacity building support under Component 3 will be provided to the participating cities, which are responsible for land acquisition and resettlement planning, while financing may be supported by the central government if deemed necessary (and will be outlined in the LARAPs). The project will be required to ensure that the related costs are included in the city-level multi-year investment plans and are identified in advance of the Annual Work Plan review process to ensure that adequate financing for land acquisition and resettlement is made available in the relevant budget (national or subnational). Physical subprojects to be implemented in the five cities participating under Component 2 shall meet the readiness criteria outlined in the POM and ESMF that among others, will include the availability of land that is physical and legally “clean and clear”. The cities will be required to ensure that land is available following the principles, requirements and the processes as outlined in the LARAP, which will also outline the responsibilities of stakeholders and financing arrangements. 80. ESS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources. The Project will be implemented mostly in urban and densely populated areas, outside of protected natural environments. However, the investment options that participating cities lay out in their multi-year flood action plans may include future investments in the cities’ upper catchments (which may or may not be under protection regimes) to protect downstream urban areas from flooding. The ESMF therefore includes specific guidance and instructions for screening and developing site-specific ESMPs, which will need to incorporate relevant activities and measures on the protection of natural environments. The project will have a positive impact on biodiversity conservation and sustainable management of living natural resources through the implementation of ‘build back better’ and ‘building with the nature’ approaches, including application of the Page 31 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) sponge city approach that will contribute to a more favorable water-regime in the areas upstream and downstream from urban areas. Other activities and investments, including reforestation, construction of infiltration and/or retention basins, land terracing, and natural rain gardens will have a direct and positive impact on biodiversity through the stabilization of the soil-water regime, shore-line stabilization, reduced land erosion, the reduction of subsistence and landslides, as well as the reduction of risk related to downstream flooding. Although the project specifically excludes investments that could have significant adverse impacts on natural habitats, the ESMF also incorporates precautionary guidance on the preparation of Biodiversity Management Framework and Action Plans, which will be developed for flood control activities in protected areas. 81. ESS7: Indigenous People/Sub-Saharan African Historically Underserved Traditional Local Communities. The presence of Indigenous Peoples (per the definition under ESS7) is considered highly unlikely in urban areas. However, integrated urban flood resilience measures and land use planning activities under the project may have potential risks and impacts on rural areas where Indigenous Peoples may be present. The screening process in the IPPF will be used to identify whether Indigenous Peoples groups that meet the definition in ESS7 are present in the project area; if any Indigenous Peoples group is found, it will be consulted according to the processes and procedures in the IPPF, including the mitigation of any negative impacts. Any sub-project that may cause acquisition of land historically or customarily occupied by an Indigenous Peoples group, their physical relocation, or any impact on their cultural heritage, shall be excluded. These guidelines require the preparation of Indigenous Peoples Plans (IPPs), if it is found that the project would affect Indigenous Peoples either positively or negatively. 82. ESS8: Cultural Heritage. Project-related investments are likely to include significant civil works both above and below ground, which may be located near or adjacent to known historical buildings, monuments, and cultural heritage assets. Considering Indonesia’s rich historical and cultural heritage, chance finds will likely be encountered during the excavation for project-funded structural measures. Financing of blue-green and nature-based solutions outside of cities may affect cultural heritage areas of importance to local communities. During implementation, tangible and intangible cultural heritage will be identified. The ESMF contains guidance on identification related to such cultural heritage, including a chance-find procedure and guidance on the development of appropriate cultural heritage management plans during the planning process. 83. ESS10: Stakeholder Engagement and Information Disclosure. The project design acknowledges the importance of meaningful stakeholder engagement for successful and sustainable project outcomes. Key identified stakeholders include various local, provincial, and national government institutions; potentially affected communities; community beneficiaries; and civil society and community-based organizations, including the urban poor, non-governmental organizations, academics, and the media. The project has developed a SEF outlining meaningful stakeholder engagement processes and establishing mechanisms for addressing project-related feedback and grievances. During implementation, individual SEPs would be developed for each participating city, with city-specific engagement strategies and actions. 84. Implementing and monitoring environmental and social protection measures. The PIUs (River Basin Organizations) will have the primary responsibility for ES implementation. The CPMU, CPIU, and NPIUs will also have responsibilities for monitoring, reporting, and implementation of ES related measures as per the ESCP. The MPWH has experience implementing World Bank-financed projects, including ES management responsibilities. However, there may be challenges with coordination and synchronization of ES risk management planning and implementation tasks with the other stakeholders, which may require stronger support during the initial phase of the project implementation. The CPMU, CPIU, NPIUs, and PIUs will be offered capacity building support, trainings, and technical assistance to support the Page 32 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) implementation of ES risk management instruments. The project will also hire specialist technical consultants to undertake any measures necessary for managing ES aspects throughout its implementation. E. Gender 85. Gender gaps. Men and women may be exposed equally to flood hazards; however, as a result of gender inequalities, women may be more vulnerable to death or injury when floods occur, and they may face greater challenges in recovery. Gender-inclusive legislation in Indonesia has improved;49 however, women often lack opportunities to participate in flood risk management discussions or decision-making, including hazard planning and analysis. This means they have less knowledge of flood risk information, reduced access to early warnings, and fewer coping strategies following flood events. Women are typically absent from forums in which disaster risk management (DRM) decisions are made, both in local-level and higher-level decision-making bodies; the interests of women are therefore often poorly represented when sectoral priorities are established. In Indonesia, women's representation in management positions is particularly low in government. Central Bureau of Statistics (BPS) (2019) data show that women civil servants are clustered at lower levels of responsibility; women hold only 13.6 percent of Echelon 1 and Echelon 2 positions.50 Women’s parliamentary representation at the sub-national level is also well below the national level at around 18 percent following the 2019 election,51 with only 35 percent (in Central Kalimantan) as the highest proportion.52 This is also consistent with the number of women in community decision-making positions; in Padang, only around 30 percent of those in DRM Forum decision-making positions are women.53 Based on community-level data, women’s participation in community-level disaster risk reduction forums can be as low as 30 percent.54 The representation of women in city-level disaster risk management-related task forces in Banjarmasin, Bima, Manado, Medan and Semarang varies between 19 and 32 percent.55 It is crucial for women’s voices to be heard in such forums to address the above vulnerabilities and because women often hold important community roles and can share flood risk knowledge effectively. 86. Project actions. The project aims to close the gender gap and strengthen women’s voice and agency , and particularly their participation in flood risk decision-making. The goal is to ensure that women are better equipped to cope with disasters, and that flood resilience investments are better targeted. The project will also aim to engage women (as well as people with disabilities, the elderly, and children) to develop multi-year urban flood resilience action plans that address the diverse needs of population groups through flood risk reduction investments (e.g., public space 49 Law No. 24/2007 on Disaster Management promotes non-discrimination of all citizens in planning and decision-making for disaster risk reduction, and BNPB Regulation No. 13 Year 2014 provides a guideline for gender mainstreaming in disaster management 50 Badan Pusat Statistik (Central Bureau of Statistics) (2019). Number of Civil Servants by Position and Gender, December 2019. https://www.bps.go.id/indikator/indikator/view_data_pub/0000/api_pub/56/da_02/1 51 Aspinell, White, Savirani. ‘Women’s Political Representation in Indonesia: Who Wins and How?’, Journal of Current Southeast Asian Affairs, Vol. 40, Issue 1, 2021 52 Ministry of Women Empowerment and Child Protection. (2021). Profil Perempuan Indonesia 2020, February 2021. https://www.kemenpppa.go.id/index.php/page/read/26/3057/profil-perempuan-indonesia-tahun-2020 53 World Bank (2021). The National Urban Flood Resilience Program: Preliminary Findings on Gender Equality and Social Inclusion Issues for Urban Flood Resilience. 54 Oktari, R. (2018). Capacity Building for Disaster Resilience Villages [Bahasa Indonesia]. This study found that the establishment of a Disaster Risk Reduction Forum in Lam Teungoh village comprised only 30 percent women. This is also apparent in the flood management agencies of the selected cities, e.g., with around only 30 to 40 percent of members being women in Bima’s Village Disaster Preparedness Team. 55 During a focus group discussion on Socially-Inclusive National and City-Level Flood Risk Management in May 2022, stakeholders informed that the Disaster Risk Forum in Bima comprises 32 percent women, while the task forces in each sub-district in Banjarmasin average only 18 percent for women representation, with East Banjarmasin having the lowest women’s participation (12 percent). In the other cities, women’s representation only reaches 14 to 19 percent. Page 33 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) improvements that address women’s concerns around public safety, awareness-raising activities that highlight women’s role in sharing flood risk knowledge). The planning and design phase of subprojects will include design workshops that target women to increase their access to information and boost their involvement in the design process. Under Component 3, the project will aim to ensure that city-level urban flood resilience task forces have gender balance to expand women’s roles in decision-making for flood risk planning, coordination, decision-making, knowledge sharing, and awareness-raising activities. A minimum target of women’s representation on these task forces will be stipulated in the POM. These task forces including minimum gender composition will be institutionalized beyond the lifetime of the project to support multi-sectoral urban flood resilience through a mayor’s decree (or similar). In addition, under Component 3, the project will conduct and institutionalize (under the national program) targeted training to help women, including on the task forces, make informed decisions on flood risk reduction and preparedness. The aim of the training will be to integrate gender systematically into urban flood risk management to increase the knowledge of task force members. The project will work with city-level women’s organizations to develop these targeted training modules. 87. Indicators. The project Results Framework will monitor progress on gender actions via the results indicators outlined in Table 4. The PIUs will monitor women’s representation on city-level task forces annually. Training participant surveys will be carried out at the start and end of training initiatives to measure the knowledge gained, including to measure whether women members of task forces have increased knowledge to make decisions on urban flooding. Table 4: Gender gaps, proposed actions, and results indicators Gender Gaps Actions Results Indicator (1) The role of women at the • Conduct and institutionalize participatory Women beneficiaries who report community level to participate in training and tailored outreach and information that they have increased knowledge local level planning and decision campaigns on flood risk management and to make decisions on urban making for urban flood resilience. preparedness. flooding as a result of targeted • Design, provide and institutionalize trainings to training and preparedness activities communities to increase women’s knowledge (baseline 0, end target 75 percent). and understanding of urban flood risk management. (2) The representation of women • Actively support women’s representation in Women’s representation in in formal decision-making bodies decision-making positions on participating decision-making positions on related to urban flood resilience. cities’ urban flood resilience task forces to city-level urban flood resilience task This gap is visible at the empower women’s voices in decision-making, forces (baseline 0, end target 35 community level and in higher- knowledge sharing, and dissemination percent). level decision-making positions. activities. • Institutionalize urban flood resilience task forces through a city-level decree including a minimum gender composition. F. Climate Change 88. This project directly addresses the climate change vulnerabilities of the urban sector, as set out in the project’s vulnerability context. Through climate-adaptive risk identification, planning, investment, and response, the project will strengthen the resilience of the selected Indonesian cities against increasing urban flood risks. These resilience measures will prioritize and integrate environmental sustainability and climate mitigation, which will derive multiple benefits Page 34 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) beyond adaptation and mitigation, including ecological conservation and urban livability. Table 5 describes how respective project activities would deliver climate adaptation and mitigation benefits. Table 5: Climate adaptation and mitigation benefits expected under the project Project Components Adaptation Mitigation Component 1: Flood risk analytics and planning • Flood risk maps and modelling for the participating • Studies will enhance cities integrate projected climate change impacts. environmental services and • Urban flood resilience action plans will integrate protection, including by measures that adapt the design of proposed exploring ways to investments to climate risks. understand and improve waste management, • Technical studies, including soil subsidence investigations, will collate climate change data and recycling, and utilization. information to guide climate-informed decision- making, such as enhancing technical options for subprojects to consider design adequacy and capacities for climate change impacts. Component 2: Urban flood resilience measures • For pumping stations, the • Design of the structural investments (e.g., drainage project will explore pipes and channels, river improvements, and environmentally and reservoirs) will consider climate risks, such as financially sustainable increased runoff and the resulting need for greater options for energy sources flow capacities. and energy efficiency, • Blue-green infrastructure solutions will serve both including but not limited to Sub-component 2.1: Structural renewables. flood resilience measures as flood mitigation measures and have additional adaptation and mitigation benefits (e.g., water • Pedestrian paths and reservoirs can not only retain water to reduce walkable urban streets will inundation but also serve as a water source during be developed to reduce droughts; vegetation cover can reduce urban heat motorized transport. island effects; and green spaces can host post • Mangroves will be restored disaster evacuation and/or response centers). and planted along vulnerable coastal areas. • Improving flood early warning systems and early N/A action advice to consider climate change impacts. • Targeted public awareness campaigns and capacity Sub-component 2.2: Non- building will improve emergency preparedness, structural measures especially among climate-vulnerable groups. • City-level business continuity planning and contingency planning will consider the uncertainties related to climate change impacts. Component 3: Program management and implementation support • Advocacy on national urban flood resilience N/A Sub-component 3.1: Program program will help Indonesian cities identify and management prioritize climate adaptation measures. Page 35 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Project Components Adaptation Mitigation Sub-component 3.2: Program N/A coordination support Sub-component 3.3: Project N/A management • Training modules will cover climate risk knowledge, • Training modules on climate climate-resilient urban flood risk management, and mitigation measures relevant Sub-component 3.4: Project climate adaptation measures. to flood resilience interventions implementation support • Capacity building for the private sector will cover climate resilience and sustainability. V. GRIEVANCE REDRESS SERVICES 89. Communities and individuals who believe that they are adversely affected by a project supported by the World Bank may submit complaints to existing project-level grievance mechanisms or the Bank’s Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed in order to address project-related concerns. Project affected communities and individuals may submit their complaint to the Bank’s independent Accountability Mechanism (AM). The AM houses the Inspection Panel, which determines whether harm occurred, or could occur, as a result of Bank non-compliance with its policies and procedures, and the Dispute Resolution Service, which provides communities and borrowers with the opportunity to address complaints through dispute resolution. Complaints may be submitted to the AM at any time after concerns have been brought directly to the attention of Bank Management and after Management has been given an opportunity to respond. For information on how to submit complaints to the Bank’s Grievance Redress Service (GRS), please visit http://www.worldbank.org/GRS. For information on how to submit complaints to the Bank’s Accountability Mechanism, please visit https://accountability.worldbank.org. VI. KEY RISKS 90. The overall risk to achieving the PDO is assessed to be “Substantial”, because the combined environmental and social risk is rated “High”, and risks related to technical design, implementation capacity, and fiduciary aspects are rated “Substantial.” There is also a potential risk categorized under “Other” related to the ongoing COVID-19 pandemic and localized disasters, which may result in alternative prioritizations of the government’s future development agenda , despite prior commitment to the national urban flood resilience program. 91. Technical design of project risk is rated “Substantial” due to the technically complex project design, which incorporates innovative technologies, processes, and approaches (such as integrated urban flood resilience) that are unfamiliar to some project stakeholders. There are gaps in the knowledge of technical standards and guidelines on new approaches such as nature-based solutions, and there may be a lack of information on the applicability of these approaches to local conditions and how they relate to grey infrastructure interventions. A capacity building assessment56 of project stakeholders highlighted the need for increased awareness of technical solutions for flood resilience, capacity building for risk-informed spatial planning and water sensitive-urban design, and more training on state-of-the-art 56The World Bank conducted a capacity building assessment in 2019 through a combination of consultations, questionnaire surveys, and secondary research. A total of 46 stakeholders from 28 government agencies at the central level and from the cities of Bima, Manado, and Pontianak were assessed through a national-level stakeholder workshop and e-mail survey. Page 36 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) monitoring and surveying techniques that support flood risk mapping tool development and applications (e.g., hydrological and hydro-dynamic models and geographic information system mapping). The project will address these constraints through Component 3 activities, especially through the establishment of the national program, starting with an updated baseline assessment of capacity needs and a customized capacity-building and training program for each target city to enhance the quality of priority flood resilience interventions. In addition, the project will establish a quality assurance/quality review process including a technical advisory panel to enhance the quality of integrated designs. 92. Institutional capacity for implementation and sustainability risk is rated “Substantial” due to limited stakeholder experience and policy frameworks on integrated urban flood risk management, as well as limited subnational budgets for O&M (particularly due to the need to prioritize COVID-19 mitigation measures and economic recovery). Institutional strengthening and capacity building activities under Component 3 will strengthen the technical capacities of project stakeholders for urban flood resilience, develop relevant city-level policies and regulations (such as on green infrastructure guidelines and development control policies for flood-prone land), and provide training on O&M planning and budgeting. O&M plans will be required for each subproject during the planning and design phase. The city-level urban flood resilience task forces are expected to help enhance inter-agency coordination in the selected cities to support implementation and longer-term urban flood resilience planning. 93. Fiduciary risk is rated “Substantial”, with Procurement risk rated “Substantial” and Financial Management rated “Moderate”, based on the assessment of implementation arrangements and the agencies that would be carrying out procurement and financial management. Procurement. Procurement risk may arise from delays in procurement due to the limited experience of the implementing agencies on the Bank’s procurement regulations and handling innovative and complex procurements. To address this risk, the Bank will provide additional training to project stakeholders and the POM will stipulate detailed procurement procedures. Financial management. FM risk may arise from the inadequacy of the allocated project budget under DIPA and from weaknesses in payment verification. To mitigate these risks, the CPMU will monitor the DIPA allocation under each CPIU, NPIU and PIU with assistance from the FM consultant, and the POM will include all valid supporting documents required for different types of expenditures. The CPMU will arrange training to ensure that the CPIU, NPIUs and PIUs are familiar with and comply with the project requirements. 94. Environmental and social risk for the project is rated “High”, with Social risk rated “High” and Environmental risk rated “Substantial”, based on the program approach; types of investments; project settings and locations of structural measures; implementation arrangements and capacities; the responsibilities (and overlaps) of central and subnational entities for environmental and social management; and subnational capacity for enforcement of related regulations and financing of land acquisition costs. The project-related activities are unlikely to result in significant impacts on the environment. Civil works under Component 2 may cause site-specific social and environmental risks related to land acquisition and ownership, resettlement, labor management and influx, occupational and community health and safety, restriction of access to natural resources, and waste management. Robust stakeholder engagement will be critical to address these issues, and subprojects that require resettlement will be carried out during later stages of the project, allowing time for adequate engagement with affected communities and for the preparation and implementation of a LARAP. The Government will need to ensure that the costs for land acquisition and resettlement activities are included timely in the budget allocation process for subprojects approved under the Annual Work Plan. 95. Other risks for the project include the impacts of the ongoing COVID-19 pandemic and potential local disaster events during project implementation. This is rated “Substantial” given the need for urgent government attention to the pandemic. To ensure action on flood resilience priorities, the synergies of urban flood resilience investments and the Page 37 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) improvement of public health outcomes will need to be emphasized during implementation. COVID-19 health and safety considerations could affect the project if case numbers rise or if health-related lockdowns cause delays; these risks will be addressed as part of overall environmental and social risk mitigation measures. In addition, Indonesia’s high vulnerability to multiple natural hazards means that potential catastrophic events could affect project cities, causing project stakeholders to divert their attention to emergency response and recovery. Adequate project management and . technical consultants are included in the project design to help ensure that project implementation remains on track. Page 38 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) VII. RESULTS FRAMEWORK AND MONITORING Results Framework COUNTRY: Indonesia Indonesia: National Urban Flood Resilience Project (NUFReP) Project Development Objectives(s) The Project Development Objective is to reduce flood risk in select Indonesian cities through increased national and city-level capacities and investments for integrated urban flood risk management Project Development Objective Indicators RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 Protection of population and increased capacity of cities for integrated urban flood resilience Target population benefitting from integrated urban flood 0.00 0.00 500,000.00 1,250,000.00 2,000,000.00 2,450,000.00 resilience measures under the project (Number) Regulations and/or policies on integrated urban flood 0.00 0.00 3.00 5.00 7.00 10.00 resilience adopted by city governments (Number) Improved interagency coordination on city-level urban flood resilience City-level interagency urban flood resilience task forces 0.00 4.00 5.00 5.00 5.00 5.00 established and functional (Number) Increased national capacity for integrated urban flood risk management Page 39 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 National urban flood resilience program established with procedures adopted for investment financing, No No No Yes Yes Yes institutional strengthening, and knowledge exchange (Yes/No) PDO Table SPACE Intermediate Results Indicators by Components RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 Flood risk analytics and planning Cities with updated flood risk models and mapping that address urbanization and 0.00 0.00 0.00 3.00 6.00 6.00 climate change effects (Number) Cities with multi-year urban flood resilience action plans developed with integrated 0.00 0.00 0.00 3.00 5.00 6.00 measures and climate risk considerations (Number) Urban flood resilience measures Riverbank or drainage upgrades or improvements 0.00 0.00 15.00 30.00 35.00 40.00 (Kilometers) Subproject activities with green 0.00 1.00 3.00 6.00 10.00 15.00 infrastructure and water- Page 40 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 sensitive urban design measures (Number) Cities with an enhanced and functioning flood early warning 0.00 0.00 0.00 2.00 4.00 5.00 system (Number) Completed subprojects with operations and maintenance plans prepared and costs 0.00 0.00 70.00 80.00 90.00 95.00 included in annual budgets (Percentage) Program management and implementation support People trained on relevant flood risk management topics 0.00 150.00 300.00 350.00 400.00 500.00 (Number) Women's representation in decision-making positions on 0.00 20.00 25.00 30.00 35.00 35.00 city-level urban flood resilience task forces (Percentage) Women beneficiaries who report that they have increased knowledge to make decisions on urban flooding as 0.00 0.00 50.00 65.00 70.00 75.00 a result of targeted training and preparedness activities (Percentage) Number of cities that have accessed technical support 0.00 0.00 3.00 5.00 10.00 15.00 from the national digital knowledge platform (Number) Number of cities that have adopted the standard 0.00 0.00 5.00 6.00 6.00 6.00 operating procedures of the Page 41 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 national program (Number) Beneficiaries who report that project investments reflect 0.00 0.00 0.00 45.00 55.00 70.00 their needs (disaggregated by gender) (Percentage) IO Table SPACE UL Table SPACE Monitoring & Evaluation Plan: PDO Indicators Methodology for Data Responsibility for Data Indicator Name Definition/Description Frequency Datasource Collection Collection The River Basin Organizations (PIUs) will determine the extent to This indicator will measure Annual which measures under the number of people that project the project protect city CPMU with inputs from are exposed to floods in the progress populations living in CPIU - Directorate of Target population benefitting from five cities supported under report, Annual areas exposed to Rivers and Coasts, and integrated urban flood resilience the project that are Management floods, e.g., the number PIUs - River Basin measures under the project protected by structural Information of people benefiting Organizations. and/or non-structural System from a river measured financed by the (MIS) improvement project. subproject or a city- wide flood early warning system. The CPMU will collate Page 42 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) information from the different PIUs. The Ministry of Home Affairs (NPIU) will support city governments to develop and adopt Annual regulations and policies project related to integrated This indicator will measure progress urban flood resilience, the number of policies or report, Mana such as spatial plan CPMU with inputs from Regulations and/or policies on integrated regulations that have been Annual gement (RTRW), detailed spatial the NPIU - Ministry of urban flood resilience adopted by city adopted by city Information plan Home Affairs. governments governments for integrated System (MIS) (RDTR), development urban flood resilience. control policies and incentives, design guidelines, emergency preparedness, and local regulations on financing or O&M. The CPMU will collate this information. This indicator will measure The Ministry of Home Annual the number of cities Affairs (NPIU) will project supported by Components 1 support local Annual progress CPMU with inputs City-level interagency urban flood and/or 2 that have governments to reports, Man from NPIU - Ministry of resilience task forces established and established a city-level establish task forces agement Home Affairs. functional urban flood resilience task (e.g., coordination Information force comprising relevant team) and confirm to System (MIS) agencies to make decisions the CPMU when on the project and guide a budget has been Page 43 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) technical implementation of allocated for subprojects. operational costs of the task force and is holding regular meetings (at least quarterly). The Ministry of National Development Planning will facilitate establishment of the This indicator will measure national program whether the Government of under Component 3 Indonesia has established a Annual and develop national-level platform for project implementation National urban flood resilience program government and non- progress NPIU - Ministry of mechanisms including established with procedures adopted for government partners to Annual reports, Man National Development standards, procedures, investment financing, institutional coordinate efforts, agement Planning protocols, and strengthening, and knowledge exchange contribute financing, and Information awareness-raising exchange knowledge on System (MIS) materials. This indicator integrated urban flood risk will be achieved when a management in Indonesian government regulation cities. is issued to establish the national program. ME PDO Table SPACE Page 44 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Monitoring & Evaluation Plan: Intermediate Results Indicators Methodology for Data Responsibility for Data Indicator Name Definition/Description Frequency Datasource Collection Collection The River Basin Organizations (PIUs) will support cities to update flood risk This indicator will measure Annual models and maps to the number of cities that project consider how CPMU with inputs from have prepared and progress urbanization and CPIU - Directorate of Cities with updated flood risk models and completed city-level flood Annual reports, Man climate change is Rivers and Coasts, and mapping that address urbanization and risk maps and models that agement affecting flood risk and PIUs - River Basin climate change effects have considered the impacts Information to inform future Organizations. of increasing urbanization System (MIS) investments. They will and climate change effects. confirm to the CPMU when the updated modeling/mapping is completed. The River Basin This indicator will measure Annual Organizations (PIUs) the number of cities project will support cities to supported under progress develop the action CPMU with inputs from Cities with multi-year urban flood Component 1 (except IKN) reports, Man plans and confirm with CPIU - Directorate of resilience action plans developed with that have developed multi- Annual agement the CPMU when the Rivers and Coasts, and integrated measures and climate risk year and multi-sectoral Information city government has PIUs - River Basin considerations urban flood resilience action System (MIS) adopted the plan Organizations. plans, based on the updated through a decree, flood risk mapping and regulation, or other modeling. similar mechanism. Page 45 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) The River Basin Organizations (PIUs) Annual This indicator will measure will calculate the project CPMU with inputs from the number of kilometers of kilometers of progress CPIU - Directorate of completed riverbank or completed riverbank Riverbank or drainage upgrades or Annual reports, Rivers and Coasts, and drainage upgrades or drainage improvements Management PIUs - River Basin supported under improvements and Information Organizations. Component 2 in the five upgrades in each city System (MIS) selected cities. and report them to the CPMU. This indicator will measure The River Basin the number of subprojects Organizations (PIUs) (procurement packages) Annual, Ma will calculate the that have incorporated nagement number of subproject CPMU with inputs from Annual green infrastructure and/or Informatio activities that contain CPIU - Directorate of Subproject activities with green project water-sensitive urban n System natured-based Rivers and Coasts, and infrastructure and water-sensitive urban progress design features in the (MIS) solutions, green PIUs - River Basin design measures reports overall technical design and infrastructure, and/or Organizations scope of works, and also water-sensitive urban have demonstrated co- design measures, and benefits (e.g., ecological, report to the CPMU. social, recreational). The River Basin Annual This indicator will measure Organizations (PIUs) project CPMU with inputs the number of cities that will support cities to progress from CPIU - Directorate of have been supported under develop and enhance Cities with an enhanced and functioning Annual reports, Rivers and Coasts, and Component 2 to enhance flood early warning flood early warning system Management PIUs - River Basin existing flood early warning systems, and once they Information Organizations systems or develop new are operational and System (MIS) flood early warning systems. functioning (providing alerts to all intended Page 46 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) end users), they will report completion to the CPMU. The River Basin Organizations (PIUs), with support from the city-level task forces, will calculate the This indicator will measure Annual number of completed the percentage of project subprojects that CPMU with inputs from subprojects under progress have O&M plans and with inputs from CPIU Completed subprojects with operations Component 2 that have Annual report, relevant costs are - Directorate of Rivers and maintenance plans prepared and developed O&M plans and Management included in national or and Coasts, and PIUs - costs included in annual budgets included the relevant costs Information subnational annual River Basin Organizations in the annual budget System (MIS) budgets. The CPMU process. will calculate the percentage of these subprojects out of the total number of subprojects. This indicator will measure The Ministry of Public the number of people Annual Works and Housing and trained through Component project the Ministry of Home CPMU with inputs from 3 knowledge and capacity progress Affairs will monitor and CPIU/NPIUs - Ministry of People trained on relevant flood risk building activities including Annual reports, Man record the number of Public Works and Housing management topics central- and subnational- agement participants in training and the Ministry of Home level government officials, Information and capacity building Affairs community members, non- System (MIS) under Component 3. government organizations, The CPMU will collate academia, and other project the total numbers. Page 47 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) stakeholders. The River Basin Organizations (PIUs), with support from the city-level urban flood resilience task forces, will calculate the This indicator will measure number of participants Annual the percentage of women (by gender) in urban project that comprise decision- flood resilience task progress CPMU with inputs from Women's representation in decision- making positions on city- force meetings and Annual report, Mana PIUs - River Basin making positions on city-level urban flood level urban flood resilience calculate the average gement Organizations resilience task forces task forces, and can include percentage of women Information participation of non- that attend and System (MIS) government stakeholders participate in these and representatives. meetings. The CPMU will collate the numbers and average the percentage across the cities supported by Components 1 and 2. This indicator will measure The CPIU/NPIUs Annual the number of participants, implementing project CPMU with inputs from Women beneficiaries who report that disaggregated by gender, Component progress CPIU/NPIUs - Ministry of they have increased knowledge to make that report increased 3 will implement Annual reports, Man Public Works and Housing decisions on urban flooding as a result of awareness and knowledge surveys to measure the agement and Ministry of Home targeted training and preparedness of urban flood risk through effectiveness of training Information Affairs activities training and preparedness and preparedness System (MIS) activities supported by the activities, project, especially to make including whether the Page 48 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) decisions on urban flooding. activity has increased participants' awareness and knowledge of urban flood risk. The CPIU/NPIUs will calculate the percentage of women that report an increase and the CPMU will collate the data. The CPIU/NPIUs will This indicator will measure Annual report the number of CPMU with inputs from the number of Indonesian project cities that participate in CPIU/NPIUs - Ministry of cities that have accessed progress training and capacity Public Works, Ministry of Number of cities that have accessed technical support from the Annual reports, Man building, and/or receive National Development technical support from the national digital national digital knowledge agement technical assistance, Planning, and Housing knowledge platform management platform, e.g., Information knowledge products and Ministry of Home participated in training System (MIS) prepared by the Affairs activities or capacity project. building initiatives. The Ministry of This indicator will measure National Development the number of cities that Annual Planning (NPIU) will have formally adopted the project develop standard CPMU with inputs from standard operating progress Number of cities that have adopted the operating procedures the NPIU - Ministry of procedures of the national Annual reports, standard operating procedures of the for the national National Development urban flood resilience Management national program program and support Planning program, prepared under Information cities to adopt them Component 3, through the System (MIS) through the city-level city-level urban flood urban flood resilience resilience task force. task forces. The CPMU Page 49 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) will collate information on which cities have formally adopted the procedures. The Directorate of Rivers and Coasts (CPIU) will carry out This indicator will measure a beneficiary impact the percentage of survey for Component beneficiaries, through a 2 beneficiaries and an Annual beneficiary impact survey, Annually evaluation of activities Beneficiaries who report that project project CPIU - Directorate of that confirm in their from Year annually from Year 3 to investments reflect their needs progress Rivers and Coasts responses the subprojects 3 measure whether (disaggregated by gender) reports under Component 2 have people believe the reflected their individual subprojects have met needs as expected at the their needs, as outset of the project. compared to the beginning of the project. ME IO Table SPACE Page 50 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) ANNEX 1: Implementation Arrangements and Support Plan Project Implementation Arrangements 1. Project Implementation Units. The implementation arrangements for each sub-component are outlined in Table 1.1. The CPMU will provide overall project management and monitoring of project implementation (including consolidating the annual work plan); monitor and review the project’s overall physical and financial progress; and consolidate the verification of fund utilization and process payment requests. The CPIU and NPIUs will oversee and carry out designated technical activities per their sub-components. Bappenas will be responsible for the implementation of Sub-component 3.1, especially related to the establishment and operationalization of a national program. MOHA will be responsible for technical assistance for the development of a knowledge platform and institutional strengthening and budgeting at subnational levels. The Directorate of Rivers and Coasts with support from the Directorate of Water Resources Engineering Development and the Directorate of Operation and Maintenance will provide inputs on program implementation; review technical designs and environmental and social instruments; monitor and report progress; verify funds and process payment requests; and support the implementation of flood risk management policies and regulations. The PIUs (BWS/BBWS) are expected to implement sub-project activities under Components 1 and 2; coordinate with their respective city-level task forces; and prepare technical designs and environmental and social instruments. Table 1.1. CPMU/CPIU/NPIU/PIU by component and sub-component. Component/Sub-component CPMU/CPIU/NPIU/PIU Ministry Component 1: Flood risk analytics and MPWH BWS/BBWS of respective city – PIU planning Component 2: Urban flood resilience investments 2.1: Structural measures MPWH 2.2: Non-structural measures and activity BWS/BBWS of respective city – PIU implementation Component 3: Program management and implementation support 3.1: Program management Directorate of Water Resources– NPIU Bappenas Directorate of Synchronization of Regional MOHA 3.2: Program implementation support Development II – NPIU Directorate of Water Resources Management MPWH 3.3: Project management Systems and Strategy – CPMU Directorate of Rivers and Coasts – CPIU MPWH Directorate of Water Resources Engineering Development and Directorate of Operation and 3.4: Project implementation support Maintenance – NPIU (comprising both directorates) 2. Project Operations Manual (POM). A POM will include all procedures, rules, and standards for the implementation of all components and aspects of the project, including: (i) a framework for the national program; (ii) institutional arrangements; (iii) operation of the Executing Agency (CPMU), CPIU, NPIUs, and PIUs; (iv) project planning, monitoring and evaluation; (v) environmental and social management, reporting, communication, and human resources; Page 51 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) (vi) procurement; (vii) financial management and administrative processes; (viii) grievance procedures; and (ix) procedures for amending the POM. The POM is being prepared and will be finalized prior to loan effectiveness. 3. Financial Management (FM). The CPMU will be responsible for overall project coordination, day-to-day management, budgeting, financial administration, and monitoring and reporting. In line with the government system, there will be a working unit (Satker) organization at each CPIU, NPIU and PIU, which includes government officers with the following FM functions: commitment maker, verification officer, treasurer, and accounting officers. A consultant will be hired to assist the CPMU in fulfilling the World Bank’s FM requirements. 4. All PIUs will maintain separate accounting records for all payment orders (SPM) and remittance orders (SP2D). All financial transactions will be recorded in the government accounting system and included in government accountability reports. All PIUs will keep original remittance orders and maintain files for audit purposes. 5. The CPMU will prepare a separate set of consolidated Interim Unaudited Financial Reports (IFRs) on a quarterly basis. The IFRs will contain all CPIU, NPIU and PIU payments in that period. The CPMU will be responsible for submitting the IFRs no later than 45 days after the end of each quarter. It will also prepare an annual unaudited financial report based on the IFRs completed with Notes to the Financial Statements for auditing purposes. The annual financial statements should be reviewed by the Inspectorate prior to submission to the auditor (BPK). An annual audit report will be furnished to the World Bank no later than six months after the end of the government’s fiscal year. 6. Budgeting. Financing arrangements for World Bank-financed projects implemented by central-government agencies in Indonesia are governed by an integrated budget or Daftar Isian Pelaksanaan Anggaran (DIPA). The sources of financing for project activities, including financing percentages, are detailed in the DIPA and followed strictly. 7. Procurement. Procurement under the project shall be carried out under the World Bank’s Procurement Framework in accordance with the Procurement Regulations for IPF Borrowers dated November 2020, and by the provisions of the Loan Agreement. 8. Use of National Procurement Procedures. Contracts for goods, works, and non-consultancy and consultancy services to be procured in line with the national market approach shall follow Indonesia’s national procurement procedures , established to follow Presidential Regulation (Perpres) No. 16/2018 and amendment Perpres No. 12/2021, subject to the conditions that are included in the text of the Procurement Plan. These procedures were found to be broadly consistent with the requirements of the World Bank Procurement Regulations, Section V, Paragraph 5.4 (which indicates that the procedures may be used to the extent they do not conflict with the World Bank’s Procurement Regulations, and subject to the requirements listed in paragraph 5.4 of the World Bank’s Procurement Regulations; these requirements are also reflected in the project text section of the Procurement Plan). The harmonized model bidding documents acceptable to the World Bank for national open competitive procurement would be used. If any revisions and/or improvements are needed based on the project implementation agencies’ experience in using such documents, the Bank shall further review and provide its no-objection. Currently, the World Bank in collaboration with the National Public Procurement Agency (LKPP – Lembaga Kebijakan Pengadaan Barang Jasa Pemerintah) is developing new Harmonized Bidding Documents (HBDs) based on LKPP’s Perlem 12/2021. Until an agreement on the new HBD acceptable to the Bank is agreed with LKPP, the implementing agencies shall continue using the existing HBD. Page 52 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) 9. Procurement capacity and risk assessment. MPWH, Bappenas and MOHA will be responsible for procurement and contract management under the project. MPWH will be responsible for most of the procurement in value terms, as it will be responsible for Components 1 and 2, and most of Component 3. Bappenas and MOHA will be responsible for procurement and contract management for Sub-components 3.1 and 3.2, respectively. The World Bank team conducted a procurement capacity and risk assessment of the implementing agency and rated the residual procurement risk as “Substantial.” MPWH, Bappenas and MOHA have prior experience of implementing World Bank–funded projects following procurement guidelines. Table 1.1: Procurement risks and mitigation measures No. Risk Description Mitigation Measures 1 Conflicts between World Bank • The POM will include a procurement chapter to clarify that Procurement Regulations and the procurement will follow the World Bank Procurement provisions of the Government Regulations as specified in the Loan Agreement. The POM will Perpres procurement rules and detail procurement steps for various methods to be used under documentation. the project as well as guidance related to due diligence on the verification of bidders’ qualification documents. • For open national competitive procurement, the Indonesia’ national procurement procedures can be applied subject to the conditions specified in the Project Procurement Strategy for Development (PPSD) and in the project text section of the Procurement Plan. 2 Delays in procurement process • Qualified procurement consultants will be engaged to build due to capacity constraints (weak capacity and assist PMUs and PIUs in carrying out procurement procurement capacity; lack of under their respective project components. experience in the World Bank’s • Qualified procurement specialists with prior experience in Procurement Regulations, and World Bank–funded projects will be recruited to support PIUs’ limited understanding of procurement implementation. how to properly carry out • An exclusive Procurement Committee (Pokja) will be set up procurement under those early for this project to accelerate the Government’s internal Regulations; constraints on approval of procurement documents. staffing resources for procurement and contract management). • The World Bank will provide training on Procurement Regulations and the use of the STEP portal. • The World Bank will conduct prior and post reviews as well as regular implementation support missions and offer hands-on operational and fiduciary advice and guidance. 3 Low procurement readiness in the • Procurement readiness will be enhanced by mobilizing first year of the project. resources to prepare TORs for critical consultancy services, specifications and draft bid documents of key goods and works packages, training on procurement procedures, and STEP before loan effectiveness. 4 Improper packaging plan, • The PPSD will be updated as needed to consider appropriate inappropriate technical procurement packaging arrangements, detailed and realistic requirements or design, and low procurement schedules, and a contract management plan. levels of interest from the market, • Technical specifications and TORs will be prepared based on which may result in bidding failure market survey and engagement activities. Page 53 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) No. Risk Description Mitigation Measures or low quality of procured goods • The project will avoid hiring multiple supervision consultants and works, and low value for and instead hire a single design and supervision consultant for money of concerned procurement each PIU that will also carry out technical analytical work under activities. Component 1. 5 Uncertainty around the capacities • Competent and experienced staff will be designated for the of procurement committee (Pokja) procurement committees and PIUs. members and the PIU, and around • The World Bank will provide training and experience-sharing for observed occurrences such as the the committee members. rejection of lower-priced bids due to a narrow interpretation of qualification criteria or failure to seek clarifications from bidders on factual or historic qualification information. 6 Weak procurement monitoring • The project will mandate the use of the World Bank’s online procurement planning and tracking tool (STEP) and regular reporting on procurement performance to ensure compliance with the World Bank’s Procurement Regulations; these reports can be used for monitoring. • Monitoring of procurement and contract management compliance and performance will be strengthened through centralized oversight by the PMU with the support of a Project Management Consultant. 10. PPSD summary and Procurement Plan. The implementation agency has prepared a PPSD for the project with the support of the World Bank. The PPSD forms the basis for the Procurement Plan for the contract packages to be procured under the project. It identifies risks and sets out mitigation measures. A draft Procurement Plan for the first 18 months of the project has been prepared and will be subsequently published through the STEP system. The plan will be updated annually, or as often as required, to reflect changes in the project’s implementation needs, improvements in institutional capacity, and adjustments in procurement risk. It will also be published on the United Nations Development Business website and on the World Bank’s external website. The major procurement categories to be financed by the World Bank and their implementation arrangements have been assessed in the PPSD. (a) Works. The project will support a broad range of proposed works, such as: (i) drainage network improvements; (ii) pumping stations; (iii) river improvements (including dredging, embankment improvements, and other river normalization initiatives); (iv) multipurpose detention or retention parks (which can be used for both recreation and during emergencies, for instance, as evacuation areas and staging areas for emergency services); (v) diversion channels; (vi) dikes or embankments; (vii) blue-green infrastructure (including street upgrading, rain gardens, bioswales, constructed wetlands, rainwater harvesting, infiltration, and recharge wells); and (viii) upstream basin stormwater and sediment runoff management (including reforestation, retention basins, land terracing and plantations, and gully plugs). (b) Goods and equipment. The procurements will include modernization of local hydrometeorological systems, including the procurement and installation of hydrometeorological monitoring stations, early warning Page 54 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) systems, instrumentation, and data servers, as well as integration with existing water resource information systems or databases. (c) Consulting services. The project will involve a range of consultancy services, with consultants involved in: (i) supervision; (ii) flood risk mapping and modeling (including hydrological and hydrodynamic model development and application, flood forecasting models, and climate change modeling information); (iii) soil subsidence investigations; (iv) technical studies and assessments (such as socioeconomic assessments, urban design studies and analytics, and studies to enhance environmental services and protection, such as sediment and water toxicity checks, which will help improve municipal services like water supply, wastewater management, and waste management); (v) developing multi-year and multi-sectoral urban flood resilience action plans (including urban design and engineering investment options, environmental protection, and the enhancement of environmental services); (vi) preparing feasibility studies, detailed engineering designs, and environmental and social instruments for sub-projects; (vii) public awareness campaigns; (viii). technical assistance to assess the integration of basic services infrastructure to reduce urban flood risk; and (ix) technical assistance on developing a digital, national-level knowledge management platform on urban flood risk management knowledge (including outreach and socialization with participating cities, stakeholders, and communities). (d) Non consulting services. The project will involve a range of non-consultancy services, such as baseline data collection and mapping activities, for example, digital terrain models, LiDAR mapping, photogrammetric surveys, and other surveying methods, as well as the monitoring of data such as rainfall, water levels, and discharges for simulation model calibration and validation. 11. Project implementation support staff. Individuals to be contracted for positions to support agencies in carrying out their project management functions (as assessed in the PPSD) – as distinct from individual consulting positions identified in the Procurement Plan – may be selected according to the personnel hiring procedures of the agencies or Government, as reviewed and found acceptable by the World Bank. This means that such project implementation support staff are not deemed consultants as defined in the World Bank’s Procurement Regulations, and their selection and contracts are not governed by the consultant selection procedures under those regulations, but rather by the rules of the agency or the Government. Such personnel will not be included in the Procurement Plan in STEP, but instead identified in the project implementation or staffing plan. They, like the recurrent services and supplies to maintain project office operations (office rental, internet, stationery), are expenses eligible to be financed by Incremental Operating Costs (IOCs) of the Loan or the Government’s budget. 12. The Government’s e-procurement system (Sistem Pengadaan Secara Elektronik, or SPSE) may only be used for the procurement of goods, works, and non-consulting services through the Open National Competitive Procurement, using the harmonized model bidding documents agreed between the World Bank and LKPP. The SPSE International Competitive Bidding e-procurement system modified by LKPP may be used only for the selection of consultant firms under the quality- and cost-based selection method using the World Bank’s standard Request for Proposal document adjusted satisfactorily for electronic use. Procurement under all other methods, including Open International Competitive Procurement, shall be carried out through non-electronic processes with manual issuance of invitation for bids and receipt of bids and proposals, until such time that the modification of the LKPP’s modified SPSE ICB e -procurement system has been completed by LKPP and deemed acceptable to the World Bank, which will be confirmed through the World Bank’s written no-objection. Page 55 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) 13. STEP. The Project will use the World Bank’s STEP system to plan, record, and track procurement transactions. All relevant procurement and contract documents will be recorded in STEP. The applicable method of procurement for each specific contract and the World Bank’s review requirements (prior or post review) will depend on the nature, value, and risk of each contract, and are specified in the Procurement Plan approved by the World Bank. STEP will help the World Bank to monitor procurement progress and take appropriate supportive actions in due course. 14. Disclosure of procurement information. The following documents shall be disclosed on the websites of procuring entities or implementing agencies and SPSE: (i) a Procurement Plan and updates; (ii) invitations for bids for goods and works for all contracts; (iii) requests for expression of interest for the selection or hiring of consulting services; (iv) contract awards of goods and works procured under international and national procedures; (v) a list of contracts and purchase orders placed under shopping procedures on a quarterly basis; and (vi) a list of contracts under direct selection on a quarterly basis. For international competitive bidding, information will be published internationally in accordance with the requirements in the World Bank’s Procurement Regulations. 15. Frequency of procurement supervision. The World Bank will oversee procurement through increased implementation support and increased procurement post review of a sample of contracts awarded, based on risk. All contracts not covered under prior review by the World Bank will be subject to post review during implementation support missions and/or special post review missions, including missions by consultants hired by the World Bank. The World Bank may conduct Independent Procurement Reviews of all the contracts financed under the loan at any time. Implementation Support Plan 16. Implementation support strategy and approach. The Implementation Support Plan has been developed based on the following: (i) the technical and institutional complexities of the project design; (ii) implementation capacity risks due to the large number of participating cities; (iii) lessons learned from flood risk management projects; and (iv) risks and needs as summarized in the project’s ESRS. Its objective is to provide targeted assistance to the Government on overall project supervision and technical assistance needs during project implementation. The focus of support will include: the integration of urban flood resilience measures and synergies between the strategic assessments under Component 1 and investment prioritization under Component 2; the mitigation of potential environmental and social risks; and assistance to enhancing procurement and financial management. The World Bank will maintain a dedicated project team in the East Asia and Pacific region that will provide hands-on support, working closely with other technical experts and consultants. The core task team based in Jakarta will maintain frequent and intensive coordination with the Government’s Steering Committee, Task Forces, CPMU, CPIU, NPIUs, and PIUs, as well as with global sectoral, fiduciary, and environmental and social management specialists in the World Bank to support achievement of the PDO. 17. Implementation support missions. The World Bank will conduct, at a minimum, semi-annual implementation support missions to assess project progress, review performance management issues, and provide technical advice and feedback to improve the performance of the project. The results of each implementation support mission will be discussed with the responsible CPIU and NPIUs to improve project implementation and to design technical assistance as needed. Special attention will be paid to the following: technical aspects, including quality checks in the field; safeguards; fiduciary aspects; and project implementation pace, expenditure efficiency, and overall progress. During these missions, the World Bank team may conduct various assessments and audits to help mitigate potential project risks and measure progress Page 56 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) towards the achievement of project objectives. These could include technical audits, value-for-money audits, forensic audits, and rolling audits. Key findings and agreed recommendations from all formal missions will be outlined in a Management Letter and Aide-Memoire, which will be used as formal documentation by both the Government and World Bank task team for follow-up actions. 18. Dedicated specialists. The World Bank will maintain a core task team of dedicated specialists as follows: a) Technical specialists with global expertise in areas relevant to the project (e.g., nature-based solutions, infrastructure planning, DRM, flood risk management, urban planning and design) will participate in missions to review the quality of project implementation, provide technical guidance, and help to enhance the overall quality of project activities and the achievement of project objectives. b) Environmental and social specialists. The World Bank will conduct regular missions to monitor compliance with the Environmental and Social Commitment Plan (ESCP), conduct necessary assessments of environmental and social risks, and review the implementation of ESSs. Specialists based in the Jakarta office and across the East Asia and the Pacific region will provide support. c) Procurement specialist. The World Bank will provide advice on procurement prior reviews to be carried out by the task team and will conduct formal procurement support missions at least every six months for post review of procurement. An accredited Procurement Specialist, based in the Jakarta office will provide dedicated procurement support, with additional guidance and support from the Procurement Hub Leader, also based in the Jakarta office. d) Financial management specialist. The World Bank will conduct regular financial management assessments to monitor compliance with fiduciary controls, including: budgeting and financial planning arrangements; disbursement status, management, and financial flows; internal controls (including quarterly financial reports, annual audited financial statements, and remedial actions, if any); accounting and financial reporting; and financial management facilitation. Supervision of financial management will be undertaken as part of each formal implementation support mission. The specialists will also provide initial training to the CPMU, CPIU, NPIUs, and the PIUs. e) Other experts in gender, monitoring and evaluation, and capacity building will participate in implementation support missions as needed to monitor implementation against project objectives and provide inputs for potential adjustment or improvement of operations. Table 1.2: Skills and resources requirements Resource Estimate Time Focus Resource (staff weeks per year) Team leadership TTL/Co-TTL 20/20 Technical: review of bidding Technical specialists (x4) 40 documents, contracts, training (especially nature-based solutions) Procurement specialist 6 0 to 24 Environmental and social: training, Environmental and social months 12 review, monitoring, and supervision management specialists (x2) Procurement: training, procurement Procurement specialist 4 review, and supervision Financial management: training and Financial management 4 supervision specialist Page 57 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Resource Estimate Time Focus Resource (staff weeks per year) Gender 1 Other M&E 2 Capacity building 2 Implementation support ACS 12 Team leadership TTL/Co-TTL 15/15 Technical: review of bidding Technical specialists (x3) 30 documents and contracts Procurement specialist 4 Environmental and social: monitoring Environmental and social 8 and supervision management specialists (x2) Procurement: procurement review 25 to 60 Procurement specialist 4 and training months Financial management: training and Financial management 2 supervision specialist Gender 1 Other M&E 2 Capacity building 2 Implementation support ACS 12 Drawing lessons learned and M&E specialist 2 Closing mainstreaming good practices Technical specialists 2 Note: ACS = Administrative and Client Support; TTL = Task Team Leader. Page 58 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) ANNEX 2: Detailed Project Description 1. This project supports the Government’s commitment to establish a national urban flood resilience program, the foundations of which are laid out in the National Medium-Term Development Plan 2020–24 (RPJMN). The RPJMN calls for integrated urban flood risk management that combines structural and non-structural measures, including blue-green infrastructure, flood early warning systems, restoration and conservation of watershed areas (e.g., normalization and improvement of river capacities), mangrove conservation, coastal protection infrastructure, and pollution control in lakes and dams. The key objectives of the proposed national program are to strengthen the resilience of Indonesian cities to flooding through an integrated approach and to improve flood risk mitigation, investments, and governance in participating cities. This will be achieved through four key areas: (i) use a national programmatic approach to establish dedicated resilience-building funding, leverage good practices, and facilitate knowledge management among Indonesian cities; (ii) promote technological and technical innovation to enhance implementation of localized flood resilience investments; (iii) strike a balance between structural and non-structural measures, including synergized investments in green infrastructure, urban public space improvements, and water-sensitive urban design; and (iv) enhance local-level partnerships and community participation for longer-term sustainability and ownership. Table 2.1 provides an overview of eligible activities under the National Urban Flood Resilience Project (NUFReP, P173671). Table 2.1: List of Eligible Activities under NUFReP No. Component Activities 1. Flood risk maps and modelling for participating cities, including monitoring and Flood risk survey activities to support flood risk reduction studies 1 analytics and 2. Program of priority measures and multi-year urban flood resilience action plans in planning urban areas 3. Technical studies and assessments Drainage networks Pumping stations River improvements Grey Structural – provision of a Multipurpose detention and infrastructure combination of grey and retention parks and spaces blue-green infrastructure Diversion channels at the subnational level to Dikes or embankments improve inland and coastal Rain gardens flood risk management Bioswales Urban flood infrastructure in priority 2 Coastal mangrove restoration resilience areas Blue-Green Constructed wetlands measures infrastructure Rainwater harvesting Infiltration trenches Recharge wells Hydrometeorological system modernization and early Non-structural – technical warning systems assistance to support and Risk-informed spatial planning and building codes build capacity for Public awareness and emergency preparedness integrated flood risk management Technical assistance support for basic services (water supply, wastewater and solid waste management) Page 59 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) No. Component Activities Public awareness Operations, maintenance, and asset management Development controls Program 1. Program implementation support for the national program management 2. Policy/institutional capacity building, knowledge management 3 and 3. Project management support for investments at the central, provincial, and local implementation levels (including advisory and knowledge management support and interagency support coordination) 2. Outcomes of the national urban flood resilience program would reap co-benefits, including through the development of additional green public spaces, that would bolster community and public health. By improving urban design quality through multipurpose interventions (e.g., blue-green spaces), the project would enable cities to provide urban public spaces for (safe) social inclusion and recreational opportunities. Such spaces would strengthen overall community health and resilience to non-communicable diseases, thereby reducing susceptibility to communicable diseases as well. The short- to medium-term need for physical distancing and self-isolation due to the COVID-19 pandemic could lead to longer-term needs to redesign urban spaces – for instance, by improving the multifunctionality of open green spaces so they can be used for flood management, exercise and recreational activities, and emergency preparedness (evacuation, staging areas during health emergencies), or redesigning streetscapes to accommodate wider pedestrian and green (permeable) spaces. Project activities will also need to consider support for community engagement on multi-hazard risk mitigation and preparedness, as well as urban services aimed at cleaning drainage channels to reduce flood risk and associated risks of vector-borne diseases. 3. Eligibility for support under the national program is determined through a two-part process. The pre-selection criteria for participating cities include: (i) the city’s urban flood risk profile (urban population, percentage of people in the flood hazard zone, potential physical damage due to flooding, flood risk zone classification, climate change impacts, and multi-threat disaster risk index); (ii) whether it is a nationally significant priority city, with consideration of cities in lagging regions (per the strategic plans of Bappenas, MPWH, and BNPB); (iii) whether it is part of a national economic growth area; and (iv) the timing of the next revision of the city’s spatial plan (RTRW and development plan , or RPJMD). The sub-project screening criteria for activities proposed in participating cities include the sub-project’s relevance to program outcomes; its alignment with the city’s urban flood resilience action plan, impact, readiness; and the city’s disaster preparedness.57 Banjarmasin, Bima, Gorontalo, Manado, Medan, and Semarang were selected based on meeting the above pre-selection criteria. 4. Under Component 1, the Project will support the development of multi-year and multi-sectoral integrated urban flood resilience action plans. These investment action plans wills phase prioritized actions, including structural and non-structural measures, and align them with the city’s development and spatial planning. Urban flood resilience action plans will need to consider how to mitigate (e.g., integrate nature-based solutions) and adapt (e.g., implement rainwater 57Relevant questions include: Will the project help to achieve overall program outcomes and is it well aligned with project principles? Is the project aligned with the city’s overall plan, and have structural and non-structural measures been included? How will the project reduce exposure of people to flood risk and what are its potential economic benefits? Have technical preparatory studies been completed, including environmental and social risk assessments? Have institutional arrangements been established? Is there an operation and maintenance plan? Is there an existing local regulation on disaster risk management? Are there community-based disaster risk management initiatives and investments from sources other than the national budget (APBN)? Page 60 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) harvesting) to identified future climate risks. During the development of these plans, the project will support a participatory planning approach through citizen engagement activities, including design workshops or “charrettes” that provide opportunities for communities to contribute meaningfully to the planning and design process. This component will finance technical assistance for up to seven cities 58 to develop flood risk studies, analytics, and modelling, to inform a multi-year urban flood resilience action plan. The scope of activities for the New Capital City will be limited to technical scoping studies (such as surveys and investigations, urban design studies, and technical assistance for design controls), but will not include detailed engineering designs, environmental and social instruments, and flood risk modeling. 5. Component 2 will support the implementation of a multi-sectoral and integrated approach to urban flood resilience. Conventional structural measures are often project-based and rigid, with an over-emphasis on structural measures that focus on redistributing the risk, rather than reducing it. They have limited capacity to respond to future challenges and flood risk scenarios, particularly those arising from the impacts of climate change (e.g., sea level rise, hotter climates, and more frequent and intense rainfall events). This project will support a fresh approach, including “blue-green” infrastructure and WSUD measures alongside traditional “grey” infrastructure. Investments shall be based on a quantification of their relative impacts. Flood resilience programs need to be integrated within broader urban development and upgrading projects, which should include increased, systematic investments to reduce urban flood risk. Resilient programs must include measures to enhance overall urban resilience outcomes, such as those related to public health and wellbeing, environmental protection, climate change adaptation (e.g., green urban “corridors” and restoration of coastal mangroves and wetlands for flood protection), and climate change mitigation (e.g., restoration of mangroves and floodplains for carbon sequestration59). All investments under this component shall meet the government’s standards on energy efficiency – for example, public space improvements will incorporate pedestrian footpaths and cycleways to promote low-carbon transport, as well as climate-resilient landscaping and low-energy street lighting. 6. Non-structural measures, which are equally critical to reduce flood risk, will help cities and urban communities to mitigate and better prepare for future flood events more systematically through, for example: updating and synchronizing river-basin plans,60 spatial plans, and building codes with agreed flood resilience measures; enhancing flood early warning services; and instituting public awareness and preparedness initiatives. Also critical for long-term sustainability is the institutionalization of a maintenance and improvements regime for urban drainage and flood infrastructure; this component will help cities to better manage stormwater flow and drainage systems. Under this component, up to five participating cities61 will receive technical assistance and financing to implement agreed activities (structural and non-structural) per the city’s urban flood resilience action plan (developed under Component 1 or already established by the city), starting with critical activities that would achieve immediate targets in reducing flood risk impacts (i.e., priority measures under Component 2). 7. Component 3 will support the Government to establish the umbrella national urban flood resilience program, provide program implementation support, and provide project management and implementation support for 58 The Government of Indonesia selected Banjarmasin, Bima, Gorontalo, Manado, Medan, Semarang, and the New Capital City to be supported under Component 1. 59 Carbon sequestration is the process of removing carbon dioxide from the atmosphere and storing it in solid or liquid form. 60 River-basin organizations in Indonesia are responsible for developing river-basin plans and for implementing river improvement works within their basin area. 61 The Government of Indonesia has selected Banjarmasin, Bima, Manado, Medan, and Semarang to be supported under Component 2. Page 61 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) Components 1 and 2. It will be implemented by Bappenas, MPWH, and MOHA. An integral aspect of the national program is the establishment of a national knowledge platform that will allow Indonesian cities to learn from one another and share good global practices. A digital integrated knowledge-sharing platform will also improve collaboration among government agencies, and particularly between local government authorities. There is a need for improved coordination, data sharing, and knowledge management across subnational government agencies, and for the development of a central database for existing data (such as disaster risk mapping and flood risk models) that is managed by a reliable pool of technical experts who support cities with gaps in staffing and technical capacity. Immediate knowledge gaps to be addressed include innovative financing mechanisms (such as developer levies and incentivization schemes) and risk -informed planning and urban design control policies for new developments. Immediate technical gaps to be addressed include: monitoring and survey initiatives supporting the preparation of cost-effective flood resilience investments; inclusive design for vulnerable population groups; green infrastructure design, energy efficiency, and climate risk planning (including mitigation measures for urban heat islands and WSUD); good drainage and flood protection system maintenance practices; environmental screening and codes of good environmental practices; and interlinkage of flood hazards and health-related impacts. 8. Under the framework of the national program, this project would support seven cities – Banjarmasin, Bima, Gorontalo, Manado, Medan, New Capital City, and Semarang – which exhibit different urbanization and flood risk profiles, as well as different capacities, and therefore require different approaches to flood risk management. These approaches could be scaled up to other participating cities in the national program. a) Banjarmasin is vulnerable to fluvial flooding, as water drains through the city from the upstream portions of Martapura River, and also to coastal flooding. Several parts of the city are in a low-lying tidal river area that is highly exposed to tidal waters – hundreds of river flows divide this city because it sits at the mouth of its main river, the Martapura. Urban development has caused land use changes, and the city faces the unavailability of flood control facilities, poor construction practices, and poor drainage design and infrequent maintenance. Together with its geography, these factors have resulted in the city’s high risk of flooding. b) Bima is prone to fluvial flood hazards (from overflowing rivers and insufficient drainage capacity) and coastal flood hazards (from rising sea levels and storm surges). It has also recently experienced a significant increase in human activity and land use changes. Even large, existing river profiles can no longer handle the increased runoff of water and sediments, and drainage lines have become blocked with plastic and large debris waste. c) Gorontalo is relatively flat with a slope of less than 0.1 percent, located downstream at the confluence of three major rivers (Limoboto, Bolango, and Bone rivers). The conversion of land to residential areas due to increasing urbanization and unsustainable agricultural practices has led to increasing urban flood risk. The government is preparing a long-term vision for integrated urban flood risk management in the city which includes: (i) completion of the flood control master plan; (ii) arrangement of green open spaces and determination of flood-prone zones; (iii) land rehabilitation and remediation; (iv) improvement of hydrological information systems; and (v) flood early warning systems and preparedness initiatives. d) In Manado, where the urban population is growing steadily, urban expansion – particularly in residential developments on urban fringes and along steep hillside slopes – is exacerbating erosion and flooding problems. Pluvial flooding is becoming an issue62 and new coastal developments do not provide adequate 62 As reported by the local Indonesian Meteorology, Climatology and Geophysics (BMKG) office. Page 62 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) drainage solutions (to the contrary, they in fact increase impermeable spaces), while also blocking existing drainage lines. e) Pluvial and fluvial flooding are an increasingly significant problem in Medan; more frequent and heavier rainfall in the catchments results in dangerous flood conditions. Rapid urban development has encroached on the riverbank and, in combination with a high load of sedimentation, has led to the reduction of river discharge capacity. The capacity of the urban drainage system is also limited due to lack of maintenance. f) All types of flood hazards – tidal, fluvial, and pluvial – can be observed in Semarang. The topography of this city is unique, hilly in the upstream-midstream areas and low-flat in the downstream areas. The runoff from upstream has increased significantly because the land use there has changed from agricultural to urban, leading to river flooding in the midstream area. Tidal and pluvial floods frequently occur in the downstream area and threaten the midstream due to the combination of rapid land subsidence, gradual sea level rise, and insufficient discharge capacity. The current drainage system is clearly unable to cope with the present frequency and volumes of run-off peaks in the lower city, let alone with future run-off, which will be even more frequent and voluminous. g) The government is planning the New Capital City to replace Jakarta as the capital city of Indonesia. The proposed city is located in the province of East Kalimantan, with 75 percent of the city planned to be open green space. Currently, flood problems in the designated city area occur due to overflows from the Sepaku, Semoi, and Sanggai rivers, mainly due to the lack of flood control and drainage infrastructure. 9. Project Timelines and Phasing. The duration of the project is five years although this will be assessed during implementation, including during the mid-term review (MTR). In the initial years of project implementation, cities will need to carry out flood risk analytics and subsequently prepare their multi-year urban flood resilience action plans under Component 1, which will support up to seven cities, including Banjarmasin, Bima, Manado, Medan, Semarang, Gorontalo, and the New Capital City (Ibu Kota Negara, or IKN). While the flood risk analytics and multi-year action plans are being prepared, the five pilot cities (Banjarmasin, Bima, Manado, Medan, and Semarang) will access investment support under Component 2 for eligible priority investments, i.e., investments that have clear and demonstrated effectiveness in reducing urban flood risk in the pilot cities (such as drainage infrastructure upgrading, dredging works, tidal gates, street and riverfront upgrading works, awareness activities, policy and plan development, and preparatory technical work). The cities’ multi-year urban flood resilience action plans will identify other sub-projects (including those with significant environmental and social risks), as well as the expected impacts and required instruments (e.g., LARAP, RPL). This would allow preparatory works to be undertaken in the initial years of project implementation, while implementation is carried out in the later stages. During the first year of project implementation, Component 3 would help to establish the proposed knowledge and support resource center. Page 63 of 64 The World Bank Indonesia: National Urban Flood Resilience Project (NUFReP) (P173671) ANNEX 3: Map Page 64 of 64