The World Bank Building Resilient and Inclusive Cities (P176653) Program Information Documents (PID) Appraisal Stage | Date Prepared/Updated: 08-Jun-2022 | Report No: PIDA263252 Jun 08, 2022 Page 1 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) BASIC INFORMATION OPS_TABLE_BASIC_DATA A. Basic Program Data Country Project ID Program Name Parent Project ID (if any) Benin P176653 Building Resilient and Inclusive Cities Region Estimated Appraisal Date Estimated Board Date Practice Area (Lead) WESTERN AND CENTRAL AFRICA 15-Jun-2022 29-Sep-2022 Urban, Resilience and Land Financing Instrument Borrower(s) Implementing Agency Program-for-Results Financing Government of Benin Ministère du Cadre de Vie et du Développement Durable – MCVDD Proposed Program Development Objective(s) The PDOs are to improve (i) access to climate resilient urban services and (ii) urban service delivery arrangements in the selected municipalities. COST & FINANCING SUMMARY (USD Millions) Government program Cost 970.00 Total Operation Cost 300.00 Total Program Cost 300.00 Total Financing 300.00 Financing Gap 0.00 FINANCING (USD Millions) Total World Bank Group Financing 200.00 World Bank Lending 200.00 Total Government Contribution 100.00 Decision The review did authorize the team to appraise and negotiate Jun 08, 2022 Page 2 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) B. Introduction and Context Country Context 1. The global COVID-19 pandemic and its outbreak in Benin contributed to increased poverty and widening inequalities, to the detriment of social and economic inclusion. The poverty rate went from 35.2 percent in 2010 up to 45.9 percent in 2020, following the pandemic. Recent poverty data suggest a negative but transient impact on poverty measures from recent COVID-19-related developments. Poverty and vulnerability however remain generally high. Based on the national poverty line, 38.5 percent of the population was poor in 2019, representing four and a half million people.1 The poverty headcount displays significant spatial differences: eight out twelve districts (départements), mainly in the North and center of the country, have a poverty ratio above the national level. Per capita income was US$1,291 in 2020. The Human Development Index was estimated at 0.545 in 2020, with Benin ranking 158th amongst 189 countries. Inequality in the distribution of per capita consumption was moderately high, with a Gini index of 37.8 in 2018. 2. Benin’s vision is to be “a model of democracy and stability, with all the necessary assets to become a center of inclusive and sustainable development, economic dynamism, and social progress�. This was enshrined in the 2016-2021 Government Action Program (PAG), which underpinned investments in infrastructure and focused on strengthening governance. This vision is also reflected in the new PAG for the 2021-2026 period, highlighting even further GoB’s engagement towards empowering cities, building resilience to climate change, providing basic infrastructure and improving living conditions. Sectoral and Institutional Context 3. With rapid and uneven urbanization, municipalities in Benin are struggling to keep up with current and rising demand for urban infrastructure and services. Benin is divided in 12 districts and 77 municipalities. The 12 district capitals include 3 cities with special status (Cotonou, Parakou and Porto-Novo, host to 1.1 million inhabitants, and nine others where urbanization is at an early stage, with a cumulated population below 270,000.2 About 48 percent of Benin’s population lived in urban areas in 2020 (5.87 million), with an average annual growth rate of the urban population at 3.89 percent for the 2015-2020 period, and an estimated share of 33 percent living in slums (1.96 million). By 2050, the urban population will triple— with about 15.6 million people projected to live in urban areas (65 percent of the population). At appraisal, more than half the population lives in the southern parts of the country, in a surface area that covers 10 percent of the national territory. In 2020, 73.3 percent of the urban population had access to basic drinking water services, 26.5 percent to basic sanitation services.3 Access to electricity is 58 percent in the urban areas.4 While in Cotonou most basic services within a 15-minute walking-distance such as education and health are 1 The poverty headcount rate at the US$1.90 PPP international poverty line was estimated at 14.9 percent in 2019. 2 Data from the most recent demographic census : INSTAD, fourth general population and housing census, 2013 3 (with 46.1 percent with access to improved latrines and other, and only 1.3 percent connected to sewers) Washdata, Joint Monitoring Program WHO UNICEF, data 2020 4 CIA World fact book, data for Benin Jun 08, 2022 Page 3 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) available to about 55 percent of households, this ratio drops to 20 percent in secondary cities. 4. Benin’s vulnerability to natural disasters and changing climatic dynamics makes it even more challenging – and critical – to plan, finance and deliver resilient urban infrastructure and services. Public infrastructure and services are insufficient in urban areas and unable to serve a growing population and withstand the current and future climate conditions. According to Benin National Adaptation Plan (NAP) (2021), during the period 1970 to 2019, maximal temperature increased by about +1°C and minimal temperature increased by about +2°C. Future climate projections indicate an increase in high rainfall between 2020-2050, and an increase in temperature between 0.9 to 1.9°C between 2020-2050. The main climatic risks impacting urban infrastructure are floods and high temperatures, which among others destroy paved and unpaved roads, damage green spaces, affect urban mobility and access to services. Current vulnerabilities are interlinked with rapid and uncontrolled urbanization. The NAP identifies the following key adaptation priorities in the urban development sector: strengthen and operationalization of policy, norms, and urban drainage strategies (stormwater and wastewater management), strengthen climate change resilience in the infrastructure sector, develop sustainable cities, promote climate smart cities, develop a risk and disaster prevention system in the urban environment and prevent and manage infrastructure risks. 5. Flooding being the main climatic risk in Benin, reducing urban areas’ economic potential and disproportionally affecting the poor living in informal settlements in risk-prone and/or underserved areas,5 GoB made it a top priority to build/upgrade stormwater management infrastructure in all secondary cities. In the last fifty years Benin was hit by more than fifty adverse natural events that affected over 5.4 million people (close to half of the population). While usually more localized, recurrent floods affect communities and infrastructure the most, causing the largest losses and usually correlated with epidemics outbreaks.6 For instance, the 2010 flooding event affected more than 680,000 people and 55 out of 77 municipalities in Benin. The overall damages to infrastructure, agriculture and physical assets and economic losses were estimated at US$257 million, or to 2 percent of Benin’s GDP in 2010. More recently, the 2019 floods caused damages and losses estimated at US$91.1 million and US$41 million respectively. During past floods, contamination of surface and groundwater resulting from a mix of runoff from rain with latrines and the contents of septic tanks and municipal wastes gave rise to water-borne diseases, notably cholera, putting the entire population affected by the flood as well as downstream populations at risk. Changes in climate are likely to lengthen the transmission seasons of important vector-borne diseases such as malaria, meningitis and cholera, and the rates of both water-borne diseases (resulting from unclean water) and water-washed diseases (resulting from lack of washing where water is scarce) are expected to increase. Vulnerability to flooding is even more pronounced with increased informal settlements and unregulated development in disaster-prone areas such as along riverbanks or in flood plains. Vulnerability factors include the weak enforcement capacity of building codes, land use, the need to revise the building codes themselves, lack of maintenance and scarce municipal resources. Significant investments in resilient urban infrastructure and service delivery – specifically to manage flood risks which is one of the top priorities of the Government in its NAP, are therefore needed to accommodate the large and growing number of users in the southern densely populated urban areas and in secondary cities in the North and center. 6. GoB has also taken critical measures to enhance its financial system to manage the impacts associated 5 MCVDD report for UN Habitat III conference 2016 6 EM-DAT: The Emergency Events Database – Université Catholique de Louvain - CRED, D. Guha-Sapir - www.emdat.be, Belgium Jun 08, 2022 Page 4 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) with disaster and climate-related shocks, and thereby reduce its fiscal vulnerability against disasters, but the operationalization of its disaster response fund is still lagging. Recognizing the need to build the required institutional structure to efficiently manage contingent liabilities associated with disasters with the aim to strengthen the financial capacity of the country to recover after a major event, the Ministry of Economy and Finance (MEF) expanded in 2019 the functions and responsibilities of the Economic Affairs Unit (DGAE) to systematically track public finances associated with disasters, and established an inter- institutional body-committee to explicitly assess and quantify the socioeconomic and fiscal impacts of natural disasters. Pursuing its objective to have a single budgetary framework for disaster response, GoB created in August 2020, the National Disaster Response Fund (Fonds national de réponse aux catastrophes, FONCAT) and developed a manual of procedures. FONCAT allows GoB to access immediate and more stable funds to finance emergency response in the aftermath of a disaster, health and climate-related shocks. It provides legal provisions to define clear rules and criteria for access and disbursement, as well as a governance structure. The FONCAT resources remain available to facilitate the government's response to natural disasters and epidemics and are only accessed in the case of verifiable emergencies. The manual of procedures and its application need to be strengthened to ensure full potential and operationalization of the Fund. 7. Cognizant of the critical role that municipalities can and have to play in combating climate change and delivering services, GoB continues to focus on strengthening municipalities’ financial, technical and human resources. In December 2021, GoB adopted Law No. 2021-14 on the Code of Territorial Administration, which profoundly reforms the functioning of municipalities by establishing a new distribution of responsibilities between the technical staff on one hand and political staff on the other (e.g., the appointment of executive secretaries to manage the municipal budget and six other key staff paid directly by central government). With these reinforced human resources, GoB sees an opportunity for municipalities to step up to increased responsibilities, foremost among which is stormwater management and other complementary climate change adaptation/mitigation investments including inter alia, provision of public solar street lighting, development of urban green parks, reforestation, public spaces upgrading, riverbanks rehabilitation, drainage and flood management investments. PforR Program Scope 8. The BRIC Program boundaries are defined sectorally, geographically and chronologically. The BRIC Program supports PVTD focusing primarily on priority engagement for GoB and the World Bank i.e., flood risk reduction (main climate risk in Benin) and stepping up the role of municipalities in strengthening improved resilience more broadly. The BRIC program covers 7 out of 16 municipalities, for an implementation period spanning from 2022 to 2028. Government program The BRIC Program (PforR) Reasons for non-alignment (PVTD) Jun 08, 2022 Page 5 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) Operationalize regional The Government program includes interventions in development, urbanization a number of areas: stormwater management, and Improve access to climate- wastewater management, transport connectivity, decentralization/deconcentr resilient urban services and regional markets, historic city, cadaster Objective ation policies, and support urban service delivery development, etc. The PforR will focus on flood risk the densification of arrangements in the reduction (main risk in Benin) and improving infrastructure promoting selected municipalities. resilience more generally. At the same time, it aims regional and local at improving municipal capacities. development. Duration 2020-2030 2022-2028 The PforR is a 6-year period of the PVDT. All the country with a Geographi phased approach prioritizing 7 municipalities The other 98 municipalities are already covered. c coverage 16 municipalities as per the Spatial Agenda. RA1-Gov: improve access to basic urban services RA1: improve access to RA1-Gov: is oriented towards broader urban climate-resilient urban services, the BRIC Program will focus on climate- services resilient services. Results RA2-Gov: promote areas RA2-Gov: the BRIC Program will put in place a sustainable cities through partnership agreement mechanism to promote improved territorial and RA2: improve urban service sustainable cities through improved collaboration urban planning delivery arrangements between the central and local levels. Overall $300M = Details of split are presented in the expenditure $970M Financing $200M (IDA) + $100M (GoB) framework. C. Proposed Program Development Objective(s) Program Development Objective(s) The PDOs are to improve (i) access to climate resilient urban services and (ii) urban service delivery arrangements in the selected municipalities. Proposed PDO level indicators: Number of people provided with improved urban living conditions (core indicator) Area protected against recurrent flooding through Program interventions (ha) Percentage of execution of the Partnership Agreements D. Environmental and Social Effects 9. Environmental and social risks and impacts: based on the data available and pending finalization of in- Jun 08, 2022 Page 6 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) depth analyzes as part of the Environmental and Social System Assessment (ESSA), it is unlikely that the activities covered by the BRIC Program generate irreversible impacts on protected areas, or significantly transform natural habitats and/or alter areas of biodiversity and/or important cultural resources. The activities under the BRIC Program are expected to have an overall positive impact that should be maintained over the long-term, including strengthening the resilience of targeted cities to climate change, preserving the environment, promoting local development and increasing financial resources for Resilient Cities. Adverse environmental and social (E&S) risks and impacts are expected to be moderate to substantial at most and will be generated overall by site-specific and at infrastructure-type preparation and construction work. These impacts may possibly be limited to air pollution, water pollution, soil degradation, poor waste management, destruction of vegetation cover and wildlife habitats, work accidents, traffic accidents, increased risks related to STIs/HIV/AIDS, Covid 19, and other conditions, etc. Similarly, other impacts such as disruption of ongoing economic activities and loss of income, temporary or permanent occupation of private land by agreement or voluntary cession or by recourse to expropriation for public purposes could be noted. 10. Level of environmental and social risks: Based on the findings from the ESSA, the proposed Program can be financed through the PforR instrument. The E&S risks and negative impacts associated with the BRIC Program are considered moderate to substantial, as the BRIC Program does not finance investments presenting a potentially major and significant E&S risk that could cause irreversible and unprecedented impacts (any investment raising the environmental and social risk rating to a high level would be excluded from the BRIC Program). A review of the investments that are proposed to be covered by the PforR was completed and led to the exclusion of high-risk activities and which do not comply with the six E&S fundamental principles of the PforR policy. The temporary or permanent displacement that is associated with both centrally and locally implemented investments is expected to be of moderate magnitude and investments have been planned to avoid and minimize large-scale displacement. It is possible that some sub- projects may lead to physical displacement as part of reaching the Program PDO. While these sub-projects have not yet been completely defined, one of the priorities of the BRIC is to reduce the impacts of flooding, especially to the most vulnerable communities who may be living in flood-prone zones. It is foreseen that investments may include the permanent displacement and resettlement of people living in these risk-prone areas. 11. Adequacy and capacity of existing systems to manage these environmental and social risks: Benin's E&S management system is relatively comprehensive and in line with the fundamental principles of the World Bank's PforR policy. Benin's legal framework and related action plans are conducive to environmental and social protection. The ESSA analyzed in detail the strengths, weaknesses, risks and opportunities of the whole system against the fundamental principles of PforR operations, to maximize E&S benefits, while avoiding, minimizing or mitigating significant E&S impacts. In general, it concluded that the E&S management instruments provided for by national regulations make it possible to deal with the E&S aspects related to development activities and investments. Several constraints were identified as limiting the effectiveness of the current social protection system in Benin, for example the non-application of existing texts on social protection. The institutions in charge of E&S risk and impact management at the central/national level (ABE, MCVDD, SIRAT) can manage the E&S aspects of the BRIC Program. MCVDD and SIRAT should receive capacity strengthening with respect to dedicated E&S resources to oversee investments related to BRIC implementation, and in particular for Resettlement Action Plan (RAP) and Grievance Redress Mechanism Jun 08, 2022 Page 7 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) GRM) management purposes – which are required to be in line with the World Bank 6 E&S principles. . At the municipal level, the capacity of the town halls in managing E&S aspects of sub-projects that will be implemented as part of BRIC is of moderate capacity and should be strengthened. The ESSA identified that municipalities have limited capacity to effectively manage ESMPs associated with municipally implemented public works. In particular, municipalities do not have a dedicated social specialist for the implementation of stakeholder engagement processes, grievance management, including SEA/SH, oversight of any resettlement activities associated with the construction and rehabilitation of project activities. It is recommended that E&S capacity is reinforced in each of the target municipalities. Additionally, the capacity of the Social Protection Centers in each of the municipalities shall be reinforced with both financial and human resources so that they can continue to support social risk mitigation at the local level, especially as it relates to conflict and grievance management, including support for victims of SEA/SH. The existing ad-hoc relationship between the CPS and the municipalities should be formalized through a memorandum of understanding or equivalent. . The ESSA provides recommendations through a Specific Program Action Plans (PAP) in coordination with the client to harmonize gaps between the Beninese system and World Bank principles. 12. Gaps between the national system and the requirements of the World Bank's PforR policy and guidelines. There is a lack of qualified human resources and specific financial means at the level of national and local institutions in charge of E&S assessments. The means available are mostly provided through development projects. The following gaps were also identified: (i) aspects relating to the health and public safety of workers are not clearly considered in the national environmental assessment system; and (ii) the legislative and regulatory framework of Benin does not consider “illegal� occupants of the public domain in cases of involuntary resettlement. The ESSA proposes remedy measures captured in the PAP, including developing a resettlement policy framework (RPF) that will establish the principles to be used for all sub- projects. The RPF will use the highest standard between the Benin legislation and the WB E&S principles. An overall E&S management system for safeguards aspects at the municipal level will be established before the start of the physical works to strengthen the institutional capacity to support the implementation of the BRIC Program. As part of the ESSA, a draft Technical manual for environmental and social management was developed to describe the entire E&S management procedures specific to the BRIC Program. This manual will help the structure(s) in charge of supervising the BRIC (cf. compliance with legal agreement, WB policies and procedures) to establish clear procedures to guide the assessment, management and monitoring of the E&S impacts of projects. Furthermore, at the local level, a system for managing all complaints should be put in place prior to resettlement or public works. It should be managed by the municipalities with support from the CPS who will support EAS/HS victim support among other aspects. E. Financing Program Financing Sources Amount % of Total (USD Million) Counterpart Funding 100.00 33.33 Borrower/Recipient 100.00 33.33 Jun 08, 2022 Page 8 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) International Development Association (IDA) 200.00 66.67 IDA Credit 100.00 33.33 IDA Grant 100.00 33.33 Total Program Financing 300.00 . CONTACT POINT World Bank Name : Van Anh Vu Hong Designation : Senior Urban Development Specialist Role : Team Leader(ADM Responsible) Telephone No : 5220+39651 / Email : vvuhong@worldbank.org Name : Brahim Ould Abdelwedoud Designation : Senior Urban Development Specialist Role : Team Leader Telephone No : 5390+3935 / Email : babdelwedoud@worldbank.org Borrower/Client/Recipient Borrower : Government of Benin Contact : Title : Telephone No : Email : Implementing Agencies Implementing Ministère du Cadre de Vie et du Agency : Développement Durable – MCVDD Deputy Director of the Cabinet at Contact : Adam Pinto Title : MCVDD Telephone No : 22961306767 Email : apinto@gouv.bj Jun 08, 2022 Page 9 of 10 The World Bank Building Resilient and Inclusive Cities (P176653) FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects Jun 08, 2022 Page 10 of 10