Chapter III CONNECTING PEOPLE AND MARKETS FOR ECONOMIC TRANSFORMATION Benin Country Economic Memorandum 2.0 ©2022 The World Bank 1818 H Street NW, Washington DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved This work is a product of the staff of The World Bank. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Rights and Permissions The material in this work is subject to copyright. Because the World Bank encourages dissemination of its knowledge, this work may be reproduced, in whole or in part, for noncommercial purposes as long as full attribution to this work is given. The pictures should be attributed to Stephane Brabant unless otherwise specified. Attribution—Please cite the work as follows: “World Bank. 2021. Benin Country Economic Memorandum © World Bank.” All queries on rights and licenses, including subsidiary rights, should be addressed to World Bank Publications, The World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2625; e-mail: pubrights@worldbank.org. 2 ACKNOWLEDGEMENT The Country Economic Memorandum was prepared by a team led by Nathalie Picarelli and Xun Yan. The team included Alexandre Henry, Solene Rougeaux, Saint-Martin Mongan-Agbeshie, Felicien Towenan Accrombessy, Hasan Dudu, Jakob Engel, Besart Avdiu, Mathilde Lebrand, Daniel Alberto Benitez, Megersa Abera Abate, Marjan Petreski, Esther Maria Bartl, Houdou Romaric Samson, Lulit Mitik Beyene, Alejandro Sicra, Zhen Liu, Amevi Rocard Kouwoaye, Adam Levai and Noukpo Homegnon. The report was prepared under the overall guidance of Abebe Adugna, Coralie Gevers, Atou Seck and Theo David Thomas. Helpful advice, comments and data were received from Andrea Coppola, Michel Welmond, Susana M. Sanchez, Ernest John Sergenti, Fiseha Haile, Leif Jensen, Olivier Hartmann, Jean Michel N. Marchat, Anouk Pechevy, Jim Cust, Alexis Rivera Ballesteros, Gabriel Stefanini Vicente, and Sidikou Salihou Mamadou. And from peer reviewers Sona Varma, Ashley Taylor, Amina Coulibaly, Wendy Cunningham, Sara Troiano, Paul Brenton and Anne-Cecile Souhaid. Micky O. Ananth, Maude Jean-Baptiste and Benita Mahinou provided excellent administrative and operational assistance. Kartographia provided mobile data visualization support. 24Slides designed the report. Yao Gnona Afangbedji kindly provided photos and communications support. Fiona Hinchcliffe provided excellent editorial support. The team gratefully acknowledges the collaboration with the Beninese authorities, notably the Direction Générale de l’Économie (DGE), the Ministry of Economy and Finance, and the Institut National de la Statistique et de la Démographie (INStaD). The CEM reflects the discussions from a workshop with different stakeholders in Benin in December 2020. This report would not have been finalized without the generous financial assistance from the Umbrella Facility for Trade Trust Fund and NDC Climate Support Facility Trust Fund. The team is grateful to the Development Data Partnership for their data program with X-Mode through which data was made available. 3 TABLE OF CONTENTS Page / 003 Acknowledgement Page / 005 Acronyms and abbreviations Page / 006 Introduction Page / 009 Section 3.1: Building the backbone of a competitive economy Page / 021 Section 3.2: Connecting people, markets and creating agglomerations Page / 032 Section 3.3: Financing the transport sector and strengthening its governance Page / 042 Section 3.4: Policy options Page / 046 References Page / 048 Terms and definitions Page / 049 Appendix ABBREVIATIONS AND ACRONYMS AIDI Africa Infrastructure Development Index Institut National de la Statistique et de PIMA Public Investment Management Assesment INSAE l’Analyse Economique BN Billion PLSCI Port Liner Shipping Connectivity Index ICBT Informal cross-border trade CEM Country Economic Memorandum PPP Purchasing power parity LICs Low-income countries CFAF CFA Franc SSA Sub-saharan Africa LMICs Lower-middle income countries COVID-19 Corona virus disease SDG Sustainable Development Goals MT Metric tonnes CPIA Country Policy and Institutional Assessment RAI Rural Access Index Ministry in charge of Infrastructure and National Road Safety Agency, Centre National MIT CNSR Transport de Sécurité Routière ROW Rest of the world DE4A Digital Economy for Africa Government Action Plan (Plan d’Action du PAG TEU Twenty foot equivalent unit Gouvernement 2016-2021) FDI Foreign direct investment Autonomous Port of Cotonou (Port Autonome TFP Total factor productivity PAC GDP Gross domestic product de Cotonou) United Nations Conference on Trade and UNCTAD GVCs Global value chains PIP Public Investment Plan Development IMF International Monetary Fund PIM Public Investment Management WAEMU West African Economic and Monetary Union 5 Introduction Increasing Benin’s competitiveness through better transport infrastructure and services Transport connectivity – infrastructure and services – play a vital role in market integration, economic transformation and shared prosperity. Transport connectivity boosts growth and promotes shared prosperity in several ways. First, it reduces economic distances and thereby facilitates trade, powers businesses, and connects workers to their jobs. Modern transport means lower transport costs and improved access to larger markets (Donaldson 2018). Second, it fosters market integration (of goods and labor) within and across borders (World Bank 2009). Lowering transport costs allows secondary cities to be integrated into value chains; and connected cities will also create density leading to potential gains from agglomeration economies (Duranton and Puga 2004). Last but not least, better transport connectivity enhances service delivery to households. It promotes access to healthcare and education facilities and accelerates much-needed human capital development in a country preparing for its demographic transition (World Bank 2021). Good transport connectivity therefore not only signifies a fair stock of physical capital, but also lays a solid foundation for market integration, sector transformation and human capital accumulation. Benin’s geographical position and history have privileged transport as an important driver of growth. The Port of Cotonou (PAC), has long been the economic lung of the country, linking it with the rest of the world (ROW) and providing access for neighboring and landlocked countries. Between 2016 and 2019, the formal transport sector was the third largest contributor to gross domestic product (GDP) growth on the supply-side, after agriculture and other services; and represented approximately 9% of GDP. Its indirect contribution to the creation of added value is greater. 6 Transport connectivity is crucial for Benin’s continued growth into a middle-income economy. The current level of infrastructure is insufficient. The government fully recognizes the importance of transport-related infrastructure, which amounts to 25% of total investment in the Government Action Plan (PAG 2016-2021). It is estimated, however, that the transport sector would need an additional spending of 8.1% of GDP (including on maintenance) to meet the Sustainable Development Goal (SDG 9 and 11) linked to accessibility (IMF 2019). Ensuring sufficient funding for the sector therefore means not only mobilizing public resources, but also private financing. It is also important to ensure investment in transport services and complementary policies, such as regulations that improve the trucking industry performance, trade facilitation, passenger services and urban mobility. An adequate institutional framework reduces market friction and improves the business environment as Benin aims at greater integration into global value chains (GVCs) and to take advantage of regional markets, particularly in the context of the Africa Continental Free Trade Agreement (AfCFTA) (see Chapter IV). Finally, the investment priority should be to reduce regional inequalities in parallel to the urbanization process, so as to enhance access to service delivery and accelerate human capital accumulation. This chapter appraises transport connectivity in Benin. It assesses Benin’s major modes of transport (roads, maritime, rail and air transport) by benchmarking Benin against comparator countries and regions. It explores the uneven level of connectivity among different regions and between urban and rural areas through the lens of economic distance and transport services. It also examines governance and financing of the sector before offering a set of policy recommendations for both the short and long term. The chapter is organized as follows: Section 3.1 analyzes whether Benin’s transport sector is adequate for a competitive economy linked to the ROW; Section 3.2 discusses its role in improving socioeconomic outcomes within Benin; Section 3.3 analyzes governance and financing needs; and Section 3.4 presents policy options. 7 Introduction Benin’s economy is highly dependent on its transport network As a small open economy, Benin’s economic growth 01 Benin is highly integrated within the region depends on its connections with the region and beyond Benin’s main drivers of interconnectedness are merchandise trade and movements of people (students, migrants, tourists), while services trade, foreign direct investment (FDI) flows, and ICT-related services are less dynamic (Global Connectedness Index 2020). In 2019, neighboring countries accounted for more than 70% of Benin's official international flows of trade, capital, information and people. Nigeria, by far the largest, accounts for 41% of all linkages (excluding unrecorded informal trade). Togo is in second place, which together with other countries in the region accounts for 30% of total flows. Benin’s main trading partners are regional, although this is not visible from official recorded trade statistics (see Chapter IV). As with other countries in sub-Saharan Africa (SSA), most of Benin’s trade is carried by the region’s trunk road network, comprising strategic trading corridors linking deep seaports to economic hinterlands. Informal cross-border trade (ICBT) is also prevalent and has a long history given the region’s artificial and often porous borders, a long tradition of regional trade and weak border enforcement Source: DHL 2020; Notes: The “rooted map” produced by DHL in the Global Connectedness Index 2020 depicts the (Golub et al. 2019). size of countries’ international flows in geographic space. Note that the rankings here are not directly comparable to the top 10 trading partners of Benin. This is because of the weight given to each component of the DHL index: trade 35%, capital 35%, information 15%, and people 15%. 8 Introduction BETTER TRANSPORT INFRASTRUCTURE AND 3.1 SERVICES CAN BUILD THE BACKBONE OF A COMPETITIVE ECONOMY Transport infrastructure and services can be the catalyst for economic and productivity growth. By connecting Benin with the rest of the world, they play a key role in the process of structural transformation and job creation. This role starts as a connector for trading goods and services, a central element of Benin’s economy. 9 3.1.1 The Autonomous Port of Cotonou (PAC) is central to Benin’s economy The PAC channels 90% of foreign trade, and 02 Main ports and corridors in the region contributes to 80-85% of customs tax collection and about 40% of total tax revenues The Port of Cotonou (PAC) is among the most important ports in West Africa, alongside Abidjan, Lagos, Lomé, and Tema. It is strategically located 150 km east and west of the Nigerian complex of Lagos-Apapa and the transshipment port of Lomé; and in 2020 it handled a volume of 10 million metric tonnes (mt) of annual freight and 500,000 containers. In addition to serving as a preferred supply channel for the domestic market, the PAC has a sub-regional role. It serves the inland landlocked countries (Niger, Mali and Burkina-Faso) for which it is an important transit port. There is a free trade zone at the port at the disposal of the landlocked Sahelian countries, particularly Niger. It also acts as a relay port for the Nigerian economy, which is the second largest transit volume after Niger. West Africa’s relative position in international shipping routes however reduces its port potential. The countries with the most port calls are located at the geographical corners of the continent. Egypt, Djibouti and Morocco benefit from their geographical position. South Africa provides hub port services, and its ports serve as gateways to containerized trade for itself and its neighbors. All four countries are also among those receiving the largest container ships in the continent (UNCTAD 2019). Source: Sefacil 2021 10 3.1.1 The Autonomous Port of Cotonou (PAC) is central to Benin’s economy The PAC’s performance has improved in the last decade The port has gone through major improvements in the last decade… The share of commodities in the Volumes operated at the port A 03 export have risen B 04 …but it remains Average above cargo has most steadily peers increased The PAC has seen major improvements to infrastructure and has basket has declined over time… modernized its operations. In recent years, it has witnessed a Import Export Total Commercial vessels continuous increase in freight traffic following modernization reforms 1,338,412 Average cargo tons loaded or unloaded per vessel started in the last decade (Box 3.1). The number of ships arriving at 10,000 the PAC has remained relatively constant since the beginning of the 8,000 2000s, but there has been a sustained increase in the average cargo 6,000 transported. The size of the cargo flow through the PAC increased by 45% between 2010 and 2019 (a 4.2% annual average increase) driven 4,000 by the rise of containerized traffic. The general upward trend was 2,000 temporary halted in 2014 following the fall in commodity prices, 0 notably oil prices, and again in 2019 following the unilateral border 2014 2010 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2015 2016 2017 2018 2019 2000 2002 2004 2006 2008 2012 2014 2016 2018 closure by Nigeria (chapter IV). These episodes exemplify its reliance on the neighboring country. Source: AFDB 2018a and MDP 2020b; Notes: metric tonnes Source: AFDB 2018a Benin performs reasonably well on port connectivity and C Openness to services Liner shipping exports connectivity ispar is on lower D Efficiency Net of seaport FDI inflows services remain belowonly peers associated services. Even with the differences in the size of each 05 than with all peers regional (2011-2018) peers (2019) 06 outperforms Nigeria and Ghana (2019) economy, Benin is on a par with almost all regional peers for liner shipping connectivity. The perceptions of port infrastructure quality in Score Rank Value Rank 74 recent years have improved as well, and in 2019 the PAC achieved 70 71 69 68 8 122 114 greater levels of efficiency in seaport services compared to Nigeria 6 86 and Ghana, although it is somewhat below Côte d'Ivoire, another of 74 75 68 its main competitors. Finally, the PAC also performs well regionally for 4 the size of the vessels it handles and for turnaround times (Appendix 17 16 24 2 3). 17 17 19 14 19 72 72 3.7 4.0 2.5 4.0 3.1 5.1 4.1 0 Benin Côte Nigeria Senegal Ghana Morocco Sri Lanka Benin Côte Nigeria Senegal Ghana Morocco Sri Lanka d'Ivoire d'Ivoire Structural Aspirational Structural Aspirational Source: WEF 2019, Note: The highest the score the better the performance. On the left index, scores are indexed at a 100 at the country with the highest value. On the left, the range is from 1 to 6. 11 3.1.1 The Autonomous Port of Cotonou (PAC) is central to Benin’s economy But its capacity remains below top performers … but it is still trailing its closest competitors and reaching capacity A 07 Liner Shipment Connectivity score (2006-2020) - B Selected top ports in the region Lomé and Tema are the leading container hub ports in the region, with Cotonou in third place. The PAC has shown a steady Benin; Cotonou Nigeria; Tin Can Island Nigeria; Apapa Togo; Lome Nigeria; Lagos Ghana; Tema rise in the last 15 years in terms of connectivity of liner services, rising 20 places in the ranking prepared by UNCTAD, and arriving 3rd place 40 among the main ports in the region. The steady improvement has allowed the PAC to outperform its Nigerian peers, which face serious capacity problems and significant delays, and especially Abidjan (Côte 20 d'Ivoire), the best ranked for years. Despite this, it has not kept pace with its closest neighbors, Lomé (Togo) and Tema (Ghana), who have registered rapid improvements, and are emerging as the leading hub ports in the subregion. 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Further, despite the increase in freight traffic, the PAC continues to be Source: UNCTAD 2020a inefficient vis-à-vis the needs of the hinterland and competition from Lomé. It has the lowest number of berths and the lowest depth of neighboring ports, and handles the lowest tonnage. Both exports and C 08 D The capacity of the PAC lags behind regional competitors transshipment flows have declined in recent years. The cyclical uncertainties linked to the economic and geopolitical developments in Country Port Depth (m) Access channel (m) Number of berths Length of stay of cargo (days) Average number of ships per month Average tonnage handled / year Nigeria, as well as Lomé’s ambitious development programs, are some of the main reasons behind this trend. To landlocked Niger, the Benin Cotonou 10 to 15 15 11 - 85 10,000,000 improved infrastructure, procedures, and distance of the Lomé- Niamey corridor may offer an alternative to the Cotonou-Niamey Côte d'Ivoire Abidjan 13.5 to 16 18 21 15.70 160 22,500,000 corridor. Ghana Tema 9; 11.50 to 16 18.2 to 19 18 18 129 22,000,000 In this context, the PAC’s ambitious expansion project in progress (2019-2023) is crucial for it to protect its position, keep up with Nigeria Lagos 15 - - 25 95 41,000,000 regional competition and support greater economic competitiveness. Expanding its capacity is becoming all the more important as traffic is Togo Lomé 16.50 to 17 18 13 - 115 30,000,000 expected to increase with the completion of the Benin-Niger pipeline Source: Hounsounou, A. et al. 2021 in 2022-2023. 12 3.1.1 The Autonomous Port of Cotonou (PAC) is central to Benin’s economy Box 3.1 The modernization of the PAC: 2008-2023 The PAC has gone through various phases of modernization: 2008-2012: This first phase started with adaptation and modernization to manage container and vehicle traffic. This was followed by acquiring modern equipment to operate the terminals by various handling companies, especially private ones. A digital reform also began, with the implementation of various management computer systems and simplification mechanisms. In 2011-2012 the Single Window of the Port (GUP) was put in place. As a result, operations were simplified, streamlined, and made more transparent, thus reducing costs and time for the entire system. 2007 and 2016: the waiting time at the dock for container ships and Ro-Ro ships was brought down from 46 to 23 hours and from 35 to 15 hours, respectively. The average waiting time in roadstead was reduced from 43 to 16 hours in the first case and from 36 to 8 hours in the second. The delay passage of a container at the port was 19 days on average until 2011 and has been reduced to less than 6 days. Additionally, average waiting time for trucks in 2017 was 27.55 hours, a significant improvement on 2008 when it was 104 hours. Digitization has made it possible to increase the efficiency and reduce the complexity of the processes, their cost and the time required. The complete dematerialization of activities has not been achieved however, and the system still faces many hurdles, such as the lack of a unified digital system among port operators and the incomplete centralized payment in the GUP. 2018: governance changes (Appendix 4) allowed a private party to manage the port in order to improve efficiency. The PAC, a government institution of an industrial and commercial nature with civil status and financial autonomy, represents the port authority. The Port of Antwerp International (PAI) obtained a management contract, with a three-year mandate, renewable twice. This choice aimed at improving the efficiency of management and services, modernizing installations and equipment, and repositioning as well as transferring skills for the benefit of local staff. Container handling is carried out by SOBEMAP (a state- owned company with financial autonomy), SMTC (Bolloré Group), and COMAN (APM Terminals). SOBEMAP also has a monopoly on the handling of non- containerized products, apart from the used vehicle market, which it shares with the RoRo Terminal (Grimaldi Group). 2019-2023: The current phase involves expansion at three levels: (1) pier; (2) capacity in the berths of container ships, and (3) extension of the hydrocarbon (fuel) zone and port access. After the works, the new PAC is expected to (1) have replaced its old infrastructure, adapt the access for ships to market demand (depth of 15m and length per berth of 340m); (2) container cargo, 340m vessels and 14m draft, annual handling capacity of 1.8 to 2.0 million TEUs; (3) created modern terminals adapted to demand and with an increase in capacity; (4) hydrocarbons: increase in vessel capacity and storage capacity; (5) added a dedicated Ro-Ro berth. Source: WFP 2018/Afrique Atlantique 2020/ WTO 2018 13 3.1.1 The Autonomous Port of Cotonou (PAC) is central to Benin’s economy Road transport quality is insufficient 3.1.2 Road transport still faces The share of commodities in the challenges in quantity and quality Quality of road infrastructure is below A 09 export peers has declined over time… B 10 …but it remains Benin’s above share of paved most roads ispeers low basket Value Rank Paved national roads Not paved national roads Road transportation is, by far, the main mode of transport in 8.0 107 124 94 118 150 Benin. It accounts for 93% of passenger transport and 73% of freight 76 7.0 6.0 38 62 41 110 (AfDB 2017). However, despite roads’ dominance as the main mode of 5.0 4.0 70 30 transport, paved roads account for less than 50% of national roads. 3.0 2.0 -10 Benin lags behind all its structural comparators. 1.0 -50 0.0 -90 Perceptions of road infrastructure quality are below those of Burkina Faso Ghana Senegal Morocco Benin Sri Lanka Côte d'Ivoire structural peers. For instance, the condition of Benin's roads (based Rwanda on the last 5 km of a journey) considered fair barely exceeds 50%, 2011 2012 2013 2014 2015 2016 2017 2018 while it is 65% in peer countries. The trend has somewhat slightly Regional Structural Aspirational reverted in the last two years, but quality remains low. The road Source: WEF 2019, Note: value (left axis) ranges from 1 (worst) to 7 (best) source: INSAE 2018 network condition index (defined as the sum of good and fair conditions), dropped significantly between 2015 and 2017, reaching Openness About 50%to services consider exports road is lower condition Benin has one ofremain the largest share of the lowest level in 2017. While it improved in 2018 and 2019 when it C 11 D 12 Net FDI inflows below peers than all peers (2011-2018) as fair dirt roads at the start point reached 58%, overall quality is still well below the best performing peers. Low and inconsistent development of road paving, lack of Impassable / Very poor Poor Fair Good / Very good Dirt Gravel / Stone / Muram Paved / Tarred / Concrete maintenance, insufficient oversight and the absence of overload penalties, explains this. There are significant deficiencies in thousands 23% 27% 21% 30% 39% 46% 41% 49% 57% of kilometers of unpaved roads serving villages and agricultural areas. 52% 43% 44% 73% 81% 20% 25% 29% 54% 76% 55% 40% Previous analysis of Benin showed that road transport investment can 17% 20% 35% 28% 19% 31% 20% 36% 8% have a significant impact on growth and poverty reduction with positive elasticities higher than 1 (Adjovi and Codo, 2019), particularly Ghana Morocco Burkina Faso Benin Côte d´Ivoire Senegal Togo 25% 16% 42% 19% 15% 22% 20% 16% 10% 4% 20% 11% due to the impact on farmers. The capacity of the government to Benin Burkina Côte Senegal Togo Ghana Morocco maintain the road transport network and expand coverage raises Faso d´Ivoire some complex trade-offs, particularly in countries with limited Regional Structural Aspirational Regional Structural Aspirational domestic revenue mobilization and constrained capacity to attract Source: Afrobarometer 2019 private investment to the sector. 14 3.1.2 Road transport is not meeting needs Benchmarking Benin’s roads: the Africa Infrastructure Development Index (AIDI) 13 Benin’s AIDI transport score compared with peers (2020) Benin significantly trails behind its regional comparators for the development of its road 26 infrastructure 5 11 6 8 5 5 3 2 6 4 12 4 6 12 10 2 Niger Nigeria Togo Ghana Guinea- Morocco Senegal Liberia Mali Rwanda Burkina Faso Gambia, The Benin Cote d'Ivoire Guinea Cabo Verde Sierra Leone Bissau The decline of Benin’s road infrastructure began in the early 2000s, and has continued to deteriorate, falling in the AIDI rankings both at the continental level and within ECOWAS. In 2020, Benin is behind all structural peers except Senegal. Regional Structural Aspirational Despite having better indicators than Ghana, Togo and Côte d'Ivoire in 2003, it has been outperformed by these countries Source: AFDB 2020 since 2010. While Benin’s gross investment has increased in recent years, its efficiency of investments has stalled at both 14 Benin’s AIDI transport ranking in Africa and ECOWAS has worsened private and public levels (see Section 3.3 and Chapter I). Deficiencies in road maintenance are one of the main drivers 20.0 33 33 34 35 35 36 36 35 36 34 34 33 33 33 32 33 36 37 of inadequate road infrastructure. 30 15.0 9 10 10 10 10 10 10 10 10 9 8 8 8 8 The Africa Infrastructure Development Index (AIDI) 4 4 4 5 10 10.0 transport component is made up of two indicators associated with road infrastructure: total paved roads (km per 10,000 5.0 -10 7 7 7 7 6 6 6 5 5 5 5 5 5 5 5 5 5 5 inhabitants) and total road network in km (per km2 of 0.0 -30 exploitable land area). As such, it measures density with 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 respect to population needs. Transport component index Rank in Africa Rank in ECOWAS Source: AFDB 2020; Notes: the lower the score the worse the performance. 15 3.1.2 Road transport is not meeting needs As with other countries in the region, rail and air modes are below potential Cotonou International airport is running at half its potential air The railway density of all the countries in the region is low, with 15 traffic capacity for both people and goods 16 poor service efficiency. Benin has an international airport (Cotonou-Cadjehoun) and a set of local community Benin’s railway network was constructed between 1900 and 1936. It is divided into three landing strips. The airport runway cannot easily accommodate certain types of wide- lines: Cotonou to Parakou (438 km); Pahou to Segbohoue via Ouidah (33 km), and body aircraft. Cotonou to Pobe via Porto-Novo (107 km). Benin's level of airport connectivity is low, ranking behind almost all comparable peers. The former Benin-Niger Railways and Transport Organization (OCBN) operated the This mostly results from its smaller population and nascent tourism development. service until 2014, when it was delivered in concession to Béninrail. The track and rolling stock are in poor condition and the line operations are paused due to the cancellation of The construction of a second international airport is under way in Tourou, in the the concession contract. department of Borgou, and efforts are being made to realize the new international airport (Glodjigbé Airport project). There is a long-standing project to connect the central line with Niamey, Niger: the first part of the plan was the rehabilitation of the existing 438 km Cotonou-Parakou line and See more in Appendix 5: Air fares, charges and taxes building a 625 km extension from Parakou to Niamey (estimated cost between US$ 1.2 bn to US$ 2.0 bn). Air Passenger departures, Total air freight (tonnes), Rail transport in metric tonnes annual variation annual variation 600,000 11% 10% 15% 20,000 40% 300,000 6% 18,000 15% 10% 10% 500,000 2% 20% 250,000 1% 5% 16,000 -4% -3% -4% -1% -1% -1% -3% 14,000 0% 400,000 -5% 0% -24% 200,000 12,000 -20% -5% -38% 300,000 10,000 -50% 150,000 -10% -40% 8,000 200,000 -15% 100,000 6,000 -60% -20% 4,000 100,000 -80% 50,000 -25% 2,000 0 -30% 0 -100% 0 2013 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2014 Source: MIT 2017 and MPD 2020b Source: AFDB 2018a 16 3.1.2 Road transport is not meeting needs Logistics performance has stalled 3.1.3 The quality of logistics and related services has stalled C Labor 17 productivity LPI score contributed deteriorated less than between peers 2010 to per capita growth - 2018 Transport services along regional trade corridors are essential to improve the competitiveness of the sector. Much of the transport price burden in Africa is related to the overall regulatory and market structure issues of freight logistics and related LPI 2010 LPI 2018 transport services. While Benin is keeping up with the regional average on logistics performance – and presents higher levels than almost all its peers, with the notable exception of Rwanda and Côte d'Ivoire, its performance has worsened since 2010. Chief amongst logistics transportation services is the trucking industry. Some of the major inefficiencies increasing logistics costs relate to the organization of the road 2.07 transport sector and the determination of transit transport prices without effective 2.59 2.79 2.75 2.23 2.62 2.53 3.08 2.54 2.53 2.04 2.97 2.86 2.25 2.60 2.45 2.47 2.57 0.00 2.54 2.29 2.60 competition (SSTAP 2018). In West and Central Africa, the trucking sector is extremely Benin Burkina Côte Niger Nigeria Rwanda Senegal Togo Ghana Morocco Sri Lanka diverse, ranging from modern operators vertically integrated into logistics groups to Faso d'Ivoire individuals (i.e., one man – one truck) and informal truckers who often do not even Regional Structural Aspirational own their trucks. The latter are predominant and provide transport services for Source: WB 2010/2018; Notes: the highest the LPI the better shippers. In Benin, most of the local transport capacity is from informal truckers, referred to as C Labor 'les demarcheurs'. Their equipment and services are often poor, and the average age of 18 productivity LPI by component contributed 2018 less than peers to per capita growth the national fleet is more than 25 years, compared to 17 in Togo. International haulage Customs Infrastructure activities are undertaken by small private operators. Prices are not regulated. Hauliers’ International shipments Logistics quality and competence unions claim that road conditions (particularly during the rainy season), and systematic Tracking and tracing Timeliness empty returns cut down their benefits (small scale haulers make on average less than 2 round trips per month). Overloading is common practice: about 80% of the trucks are overloaded. While the 2004 regional agreement on axle-loads limits was translated into national legislation, it is only timidly enforced. To improve logistics and its trade integration with Niger, Benin recently completed a dry port in Parakou, one of the components of the “Backbone Project” which also Benin Burkina Côte Niger Nigeria Rwanda Senegal Togo Ghana Morocco Sri Lanka includes the extension of the railway network to Niger. It is the second logistics center Faso d'Ivoire after the Allada platform, a customs extension of the PAC located 60km from Cotonou. Regional Structural Aspirational Developing modern transport services offers a great opportunity for Benin. Among the Source: WB 2018 / 2010 Notes: the largest the share in the column, the better the performance of the component. largest African companies, most are in retail, financial and transport services (McKinsey 2016). 17 3.1.3 The quality of logistics and related services has stalled… Benin faces competition in connecting landlocked countries through regional corridors The transport costs on the Cotonou-Niamey 19 Key statistics for transport corridors in West and Central Africa corridor are increased by informal costs Abidjan- Abidjan Dakar- Lomé- Douala- Cotonou-Niamey Ouagadougou -Lagos Bamako Ouagadougou N’Djamena The region’s ports mostly compete for transit traffic to Length(km) 1035 1200 1000 1470 1000 1630 the landlocked Sahelian countries (Mali, Burkina Faso and Niger). Transport and logistics costs differ quite widely MAIN GOODS Minerals & metals, Cotton exports Oil & derivatives, Cotton, cement, Cotton Petroleum products, fuels, manufactured goods, from Burkina Faso cement, chemical, salt, oil products, from Burkina Faso; chemicals, depending on the corridor, which can at least partly be food paper, textiles, cereals, rice, cement, salt, iron, food attributed to the corridor length but also to varying efficiency plastics, rubber fertilizer, sulfur, fats and goods, cotton, miscellaneous oils, cereals, mineral oil of transit services. food products The overall cost of transporting a 20-foot container is lowest COST OF Non containerized Non containerized From Lagos to Non containerized Non containerized $3,780 to $4,530 TRANSPORT Cement 30,000 CFA per ton Cement / clinker from Accra (470 km), Import 38,000 CFA Cement / clinker from for a 20-ft container on the Cotonou-Niamey corridor. But there are various ON CORRIDOR from Cotonou + Lomé 30,000 the average price per ton Lomé 30,000 to 34,500 informal costs at each step of the logistics process. From lumpsum 1.2 M per truckload to 34,500 CFA per ton SONABHY 36 F is US$4,200 per 40-ft container Cotton export 34.5 CFA per ton CFA SONABHY 36 F per m3 arrival at the port to finalizing customs clearance procedures Containers (include per m3 per km Containers (include per km at the destination, the Cotonou-Niamey takes longest (19.7 repositioning of the empty) Cotonou, 1.1 millions CFA; Containers (include repositioning of the repositioning of the Containers (include empty) repositioning of the days), while the shortest (11.6 days) is the Lomé-Ouaga empty) 1.4 M CFA empty) 1.4 M CFA Lomé -1.6 M CFA Abidjan per ton per km corridor. On top of transport services, complementary policies (trade facilitation and policies incentivizing mobility for workers and firms) play a crucial role in transforming FLEET Truck fleet average age is 25 Average fleet age Average age of About 400 trucks Average age of trucks in Most operators have CHARACTERISTICS years in Niger and 27 years in is 21 CIV and 13 in vehicles > 20 per day (85% Togo is 17 years; 30% old fleets with large transport corridors into economic corridors (Box 3.2). Benin; the average truck fleet BFA; 43% years; ~ 90% of the Malian); 60% of of the active fleet is trucks (35- 40 tons size is 3 vehicles; of Burkinabe and fleet belongs to carriers have only 1 container carriers, 6% capacity); the average involvement in 15% in Ivorian individuals; cross- vehicle; fleet is of tank trucks, and 64% age of these trucks is international truck companies border traffic is newer in Mali than of conventional trucks; younger in Cameroon traffic is higher own only 1 truck; most intense on Senegal, where as (15 years) than in among truckers in Niger than the Benin-Togo much as 85% of Chad; transit truckers in Benin; border (>2,700 vehicles are more employ larger vehicles per day) than 10 years old vehicles, Source: SSATP (2018) and Corridor Assessment Report (2019, TFWA) – data for Dakar-Bamako, Corridors to Ouagadougou and Cotonou-Niamey 18 3.1.3 The quality of logistics and related services has stalled… Complementary policies, such as to reduce friction at borders, are central to increase competitiveness There are ongoing efforts to reduce trade and transportation barriers along the different regional Border Crossing Process at Malanville: Before and After corridors. Trade facilitation reforms are crucial to support Before the OSBP After the OSBP transport investments. Checkpoints are among the leading • Mandatory stop at the Koumate parking yard, 11 km from the border complaints for transporters, traders and consumers; they slow • Documentation control by Police and Customs the average speed of travel and reduce the accessibility of • Seal’s integrity and GPS unit check border cities. With the implementation of the Abidjan-Lagos by Benin Control Trade and Transport Facilitation Project (WBG) the time for • Vehicles spend the night in the parking yard and are release in batch the merchandise/trucks to cross the borders along the corridor has next morning decreased significantly: from 24 to 10 hours (-58%) at the border • Vehicles proceed to the Malanville • Vehicles proceed to the OSBP Customs office for the Exit facility for Customs procedures between Togo and Benin and from 48 to 31 hours (-35%) on the Customs procedures and removal of the Benin Control border between Benin and Nigeria. GPS unit • The Benin T1 is stamped by the In West Africa, both ECOWAS and WAEMU promote the Niger Customs and no additional establishment of One Stop Border Posts (OSBPs) on their main Customs declaration is required in the Niger Customs IT inland border crossings, as a solution to streamline border • Crossing of the border (on the bridge) crossing procedures and eliminate unnecessary delays. There • Vehicles proceed to the Kotcha parking yard on the Niger side of the border, are two operational OSBPs, Malanville-Gaya (border with Niger) and usually spend the night and Seme-Kraké (with Nigeria), and another under construction • C&F agents declare the goods in in Hillacondji - Sanvee Condji (with Togo). The Malanville-Gaya the Niger Customs IT, domestic transit for goods proceeding to OSBP has been in operation since 2019 but operational Niamey and the other cities, or deficiencies have so far limited the benefits. Careful assessment border clearance for the local consumption (limited amount as of whether it has added a layer without necessarily removing the the steps that should be made unnecessary could help improve its Gaya office can only clear up to a efficeincy. certain amount) • Vehicles proceed to the Gaya • Vehicles proceed under Customs See Chapter IV for more details. Customs facility for release under escort Customs escort 19 Source: TFWA 2019 based on border surveys conducted in 2014 and 2019 Box 3.2 Investing in complementary policies (trade facilitation and trucking regulations) will boost the gain from upgrades in transport corridors in Benin Lebrand (forthcoming) estimates the welfare gains from upgrading several major regional corridors in West Africa using a quantitative economic geography framework. The impact on five corridors is analyzed, focusing mostly on Lagos (Nigeria)-Dakar (Senegal), including in its Southern part the corridor between Abidjan (Cote d’Ivoire) and Lagos (Nigeria) that connects the most densely populated and economically active par of the subregion and crosses through Benin. The paper quantifies the direct gains of transport investments needed to transform the road into a highway, for locations along the corridors as well as the indirect spillovers for more distant locations. Overall, it finds that the net gains of regional investments along this corridor is highest for corridors connecting to larger economies while smaller and more fragile countries gain proportionally more from accessing larger markets. Additional investments in reducing border delays would bring large additional welfare gains, reducing spatial inequality in the whole region (but increasing it in some countries). The presence of cross-border spillovers of transport investments call for reduction in border frictions in West Africa. Benin stands to benefit mostly from lower transport costs in the Abidjan-Lagos portion of the corridor, with benefits on real wages expected to be among the highest. Complementary investments in reducing border delays would increase the gains from road investments from 1% to close to 10%. Benin gains from accessing the Nigerian market more seamlessly. The simulations present income gains at the subnational levels. Reducing transit delays along the corridor brings large income gains for most regions of the countries that are crossed by the new corridor. Similar findings of potential major economic gains when transport investments are supported by complementary trade facilitation policies are also found in Central Asia, in the context of the Belt & Road Initiative (Bird, Lebrand and Venables 2020). Gains in real wages from road investment and removing See more: Subnational welfare gains (Appendix 6) trade frictions along the Dakar-Lagos corridor 20 3.1.3 The quality of logistics and related services has stalled… CONNECTING PEOPLE, MARKETS AND CREATING 3.2 AGGLOMERATION ECONOMIES TO BOOST PRODUCTIVITY GROWTH Transport infrastructure and services are strong instruments to connect people and markets (labor, capital) within countries. If well planned, they can increase access to services and amenities, catalyzing human capital accumulation. As countries urbanize, urban transport policies are also critical for reducing congestion and incentivizing agglomeration economies. 21 3.2.1 People and firms are unevenly connected to markets and services Reducing economic distance through lower transport costs would foster specialization and scale 20 Most potential market gains are concentrated in the south economies Between 2009 and 2021, population growth, urbanization and investments in infrastructure have improved market potential in Benin’s south and near urban centers. Slowly, secondary cities have started to develop (notably Parakou). In contrast, 3/4 of the country – mostly rural, and where half of the population still lives – is trailing behind, accentuating spatial disparities. Overall, distances and transport costs remain large outside of the southern tip of the country where Cotonou and Porto Novo are located. As an example, it takes more than 12 hours to drive from Cotonou to Malanville, on the border with Niger (700km from north to south). The inequalities in transport infrastructure and services create large economic distances between leading and lagging regions (Box 3.3). Agriculture still represents more than ¼ of GDP, suggesting connecting rural areas to urban centers remains key for economic growth. At the same time, services have increasingly become the main employer (Chapter I and II), and economic activity is increasingly concentrated in the south, where educational levels, basic services and other measures of well-being are higher. High domestic transport costs, and lack of adequate services, pose a major challenge to the economic integration of subnational regions and limits their potential for economic diversification. Not everyone may benefit similarly from greater integration and Source: OSM, WorldPop, Open Street Map and authors’ calculations. distributional aspects need to be considered. Notes: This figure represents market access potential, estimated as land-based travel time to the nearest densely-populated area. See more: Appendix 7. the location of economic activity 22 3.2.1 People and firms are unevenly connected to markets and services Only 23% of the rural population has access to an all-weather road Rural accessibility remains limited and is an obstacle for agricultural producerrs The share of commodities in the Percentage of the population within Distribution of national rural roads built A 21 export 2km ofhas a paved road (RAI) 22 – in km basket declined over time… Despite efforts to improve rural roads, only 23% of the rural 724 Zou 800 687 Plateau population has access to an all-weather road. Benin has made some 700 Ouémé efforts to improve rural infrastructure through various agriculture 600 532 Mono rehabilitation programs. The latest is the Strategic Development of the 500 Donga Agricultural Sector (PSDSA) 2017-2025, which clearly identifies the need to 400 345 Couffo invest in rural roads to ensure the development of key crops. It charges the 300 Colline National Council of Rural Transport (CNTR) with this task. The CNTR only 200 Borgou has an advisory role, however. Despite the prominence, the large rural Atlantique population's needs are not covered when measured by the rural access 100 Atacora index (RAI). According to 2016 data, only 22.6% of the country's rural 0 Alibori population lived less than 2km away from an all-weather road – a small 2012 2013 2014 2015 Benin improvement on the 18.1% recorded in 2009. In 2009 most communes in Source: AFDB 2020 the country (47 out of 77) had an index lower than 20%, while only 35 did in 2016. The low levels of rural accessibility are below the average for SSA Openness to servicesof exports is lower (34%) (Box 4.4). The monitoring of roads investments and maintenance is C Routine maintenance rural roads – 23 than in kmall peers (2011-2018) poor and has deteriorated since 2016. Currently, Benin uses the GERNIS method, which balances criticality and funding. Developing tools for Zou 7000 6123 improving the prioritization of rural roads would help allocate limited Plateau 6000 5093 5081 Ouémé resources according to policy priorities. 5000 Mono Poor rural road connectivity is an obstacle (especially in the north) for 4000 Donga transporting produce in good condition to hubs in the south and onward 3000 Couffo to markets abroad. This becomes especially difficult during the rainy Colline season. The lack of appropriate storerooms and markets are other major 2000 Borgou obstacles to the sale of crops, leaving farmers with low bargaining power Atlantique 1000 with buyers when supply is high (World Bank 2018). In 2021, the Atacora 0 government has improved the airport facilities in Cotonou with cold chain Alibori 2012 2013 2014 infrastructure needed to accommodate highly perishable items while Benin waiting for onward transport. Further improving this infrastructure is Sources: OSM, MPD and authors’ calculations Source: AFDB 2020 critical to the export of fresh agricultural produce. Due to the size of the domestic market, access to regional and international markets is of paramount importance. 23 3.2.1 People and firms are unevenly connected to markets and services Box 3.3 Policies to capitalize on shrinking economic distance Economic distance is generally related to the straight-line (Euclidean) distances between two locations and the physical features of the geography separating them. This relationship, however, is not always straightforward. For trade in goods and services, economic distance captures time and monetary costs. The availability and quality of transport infrastructure and services, the regulatory and business environment and the institutions shaping the market structure of the transport services industry play important roles in shaping these costs. There is overwhelming evidence that declining transport costs can enhance specialization and economic activity. However, as economic distance shrinks, the ability of regions to specialize and stimulate wider economic benefits depends on complementary policies removing spatial frictions and integrating labor and capital markets. At the same time, by enhancing competition and increasing market access for local firms, trade costs can change the spatial distribution of productivity, and thus create spatial winners and losers, exacerbating spatial inequalities. Complementary policies are needed to manage these risks. There are four sets of complementary policies and investment that can allow cities and other hubs to benefit more from transport investments. These levers are based on the World Bank (2015) Competitive Cities framework and include (1) institutions and regulations; (2) infrastructure and land; (3) skills and innovation; and (4) enterprise support and finance. Investment in transport infrastructure and services, and regulatory changes to support competition in the transport sector, can have major welfare benefits when combined with such policies. In Benin, territorial development policies are managed by the Ministry of Sustainable Development. They are linked together with transport policies in the Government Action Plan (PAG). Priorities include the development of regional hubs and governance of the sector. Source: Grover, Lall and Maloney (forthcoming); World Development Report (2009) 24 3.2.1 People and firms are unevenly connected to markets and services Transport can support human capital formation Transport infrastructure and services are needed for equitable human capital The share of commodities in the A Hospitals are accessible within a 35-minute 24 export drive in only a quarter of communes 25 Distance WEF Source: axis) ranges seeking 2019,facility to a health from 1 (worst) to 7 (best) treatment Note:is value (left a barrier for accumulation basket has declined over time… Human capital formation can also be facilitated by accessible Women aged 15-49 yrs and good quality transport services (Appendix 8). The capacity of City Lowest-quintile the population to access health and education providers is affected by the availability of reliable transport services and its affordability, 59 especially for the poorest (World Bank 2021). In Benin, more than half 52 51 43 45 51 of women between 15-49 years old from the lowest income quintile 30 28 report that distance to a health facility is a barrier for seeking 12 12 12 15 treatment. This is a concern when seeking antenatal care, crucial for 10 5 maternal and infant health (Chapter II). Due to large spatial disparities, the average time to reach a health facility in the country is Dakar Kigali Accra Lagos Cotonou Lome Abidjan 3 hours, increasing to more than 7 hours in places like Malanville. Source: World Bank 2021 Improving road safety and vehicle quality standards also supports human capital accumulation. SSA has the highest levels Openness services to of Benin has one exports the highest is lower road traffic of under-5 mortality from air pollution, with 184 deaths per 100,000 C 26 than deathall peers rates (2011-2018) of peers children (WHO). Benin is among the worst affected with 85 deaths per 29.7 29.2 100,000 children. Poorly maintained and old vehicle fleets and 27.5 23.6 21.4 23.4 24.9 absence of clean mass transit solutions means that, despite low 19.6 14.9 motorization rates, average exposure to air pollution in the country exceeds the world average by 34%. Similarly, lack of safe infrastructure and vehicles and enforcement of road safety regulations, mean that SSA has the highest road traffic fatality rate of any region, with Benin exceeding regional averages. These deaths Benin Rwanda Senegal Togo Nigeria Marruecos Ghana Côte d'Ivoire Sri Lanka wipe out years of investment in human capital and have long-term implications for the outcomes of surviving female family members. According to the INSAE, almost 1 in 10 accidents are associated with Structural Aspirational the quality of the infrastructure (in 2015). The condition of the vehicle Sources: OSM, MPD and authors’ calculations Source: WHO 2018 Note: road traffic death rates per 100,000 people fleet may also have an influence: 17% of the vehicles monitored by the Centre National de Sécurité Routière (CNSR) are in an irregular condition, mainly defective. 25 3.2.1 People and firms are unevenly connected to markets and services Box 3.4 Benchmarking Benin: roads and human capital Rural Access Index Road fatality rate per 100,000 Average annual exposure to (latest available) (children 5-14 years old) PM2.5 SSA average: 67 World average: 50 Sources: Transport Global Practice Narrative (2019) 26 3.2.1 People and firms are unevenly connected to markets and services Half of the population lives in cities, above the SSA average 3.2.2 Improving urban mobility The share of commodities in the should help trigger agglomeration A Population is increasingly locating in 27 export urban centers, basket particularly has declined in the south over time… 28 The share of the urban population has steadily risen… economies 70% Urbanization has been steadily growing. While population growth in the 60% last decade has been widespread across the country, most of the gains have Malanville 50% happened in urban centers (notably in Parakou, Benin’s third largest city, 40% Box 3.5) and in the southern tip around Cotonou metropolitan area and 30% Porto Novo. Benin has steadily urbanized as a result, driven by natural Kandi 20% 10% growth and rural-urban migration since the early 2000s. Even so, half of the 0% population still lives in rural areas with departments in the center and north having disproportionately large shares of rural populations. 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Natitingou The urban environment is unbalanced, concentrated in four main Urban Rural urban areas (in bold in the map), Cotonou being the most important. The Cotonou metropolitan area accounts for about one-third of the country's Djougou Parakou Source: WDI 2020 GDP and has rapidly expanded to encompass Abomey-Calavi in the north and Sèmè-Kpodji in the east. In 2018, it counted 1.8 million inhabitants Openness to services exports is lower spread across 350 square kilometers (SSTAP 2019). This expansion creates C 29 …placing Benin close to peers than all peers (2011-2018) huge volumes of commuter traffic, exacerbated by the fact that the city is a major hub for regional and international transport (either heading for % urban population Dantokpa market, the PAC or the international airport, or transiting on the 51% 51% 57% 63% Abidjan-Lagos international highway). 48% 48% 42% SSA cities offer proximity but limited productivity. Developing country 17% 19% cities are often crowded, congested, polluted and home to few sophisticated Bohicon firms and skilled workers that would benefit from being together. Evidence suggests a state of “sterile agglomeration”—density without productivity due Benin Rwanda Senegal Togo Nigeria Ghana Côte d'Ivoire Morocco Sri Lanka to limited structural transformation and agglomeration externalities (Grover et al. forthcoming). So far, Benin’s urban development fits this pattern. Porto Novo Cotonou Reducing congestion costs and negative externalities could support the Structural Aspirational development of a more sophisticated private sector able to drive the process of structural transformation through better jobs outside agriculture Sources: OSM, INSAE and authors’ calculations Source: WDI 2020 (chapter I). 27 3.2.2 Improving urban mobility should help trigger agglomeration economies Box 3.5. The development of Parakou: The cotton capital Parakou is Benin’s third largest city after Cotonou and Porto Novo. It was home to 255,000 people in 2017 and with an urban extent of 62 square kms, density is much lower than in Cotonou. Located in the north of the country, it is the “cotton capital” and the center of the country’s main agricultural region. It is located at the intersection of major international routes connecting neighboring countries (Burkina Faso, Niger, Togo and Nigeria) and is the terminus for the Cotonou-Parakou railway line (now not functioning). The development of Parakou is important for promoting jobs outside of agriculture in related services, thus supporting poverty reduction and structural transformation (Christiaensen and Premand 2017). Developing urban transport services and infrastructure can help improve the urbanization process. Motorized two-wheelers are the main form of motorized traffic (more so than in Cotonou). However, the city does not suffer from the same congestion problems. Motorbike taxis, partially regulated by the municipality, provide the majority of “public transport”. There are a few car taxi services operated by Bénin Taxi, tricycles provide transport services for luggage, and bush taxis offer connections with the neighboring towns and villages. The asphalt road system is limited: 58 km, including 44 km of national roads and 31 km surfaced roads. The total number of unsurfaced tracks, which constitute the wide majority, is not known. As part of the PAG, two projects will particularly benefit the city of Parakou: the extension of a road system, including 68 km for the Parakou urban area; and the development of the Djogou-Pehunco-Kérou road. As far as planning is concerned, urban development regulations do not appear to be enforced, and there is neither a mobility plan nor a traffic management plan. There are also no projects or policies aiming to create a collective urban transport service; nor is active mobility promoted even though the city’s geography would lend itself to this. Source: SSATP 2019 and AFDB 2014 28 3.2.2 Improving urban mobility should help trigger agglomeration economies Cotonou is sprawling outwards In Cotonou, limited transport infrastructure and services reduce mobility As in many African cities (Lall and Henderson 2017), urban land in Cotonou is 30 The urban extent of Cotonou 2010-2019 proxied by population growth being developed in small and disconnected fragments, sprawling outwards at low density. Limited transport infrastructure and services undermine connectivity and create congestion. This is exacerbated by the fact that the city is a major hub for regional and international transport. The lack of public funding for collective transport has led to increased individual motorization. A comparatively low taxation and para-fiscal charges on individual transport, and poorly maintained infrastructure with a low number of surfaced roads (14% in Cotonou, 1% to 2% in Abomey-Calavi and Sèmè-Kpodji), have driven people towards individual motorized transport, especially private motorized two-wheelers or operated as informal, poorly regulated taxi services (SSATP 2020). This contributes to a high number of accidents and air pollution, aggravated by the poor quality of the fuel (85% of fuel is imported informally from Nigeria). There was an attempt by the company BenAfrik in 2012 to create a scheduled public transport service, that failed, among other reasons, due to high fares, a lack of reliability and frequency of service, excessive and highly variable travel times, and a lack of well- organized stops to promote intermodal travel (SSATP 2020). Consequently, mobility remains severely restricted, not only physically but also due to the financial burden that current transport places on family budgets. Non- motorized transport is unpopular and only used by low-income groups, mainly because of safety problems, the absence of policy and planning for pedestrians and cyclists and encroached or badly maintained footpaths (SSTAP 2019). The urban mobility problem is also linked, to a large extent, to the condition of the streets, their narrow size and the constant risk of flooding. The PAG is addressing these challenges through the Programme Asphaltage (Appendix 9). Although the situation in secondary cities is less critical, pre-emptive measures should be taken. Municipalities do not seem prepared to face the challenges: they have a broad mandate for urban mobility (organization, investment, management) but Source: WorkdPop and authors’ calculations limited human and financial resources (Foussemi et al 2014). 29 3.2.2 Improving urban mobility should help trigger agglomeration economies Urban passenger transport Two-wheelers contribute most to urban traffic Other than private vehicles, passenger transport includes: 31 Composition of traffic in Cotonou (2017) • Motorbike (two-wheelers) taxis (zemidjans), by far the main transport service in Benin’s urban areas • Taxi service, with urban taxis (or “Bénin Taxi”) and Bus and minibus intercity taxis, which have lower appeal due to 2% limited flexibility and relatively high prices. Taxis 6% • Minibuses: these provide intercity transport with a greater capacity than taxis. Although they operate in an unregulated context, they do not offer a service in the urban area. • Tricycles are currently developing their transport 2-wheelers service in the main cities. They offer increased 73% Light vehicles safety for passengers, and higher transport capacity than zemidjans. 18% Standard buses have disappeared with the end of BenAfrique. In a context of limited passenger transport options, two-wheelers dominate, making up three-quarters of traffic in Cotonou. In contrast, heavy vehicles only represent 1% of the total. The prevalence of this mode increase pollution and Heavy vehicles worsens road safety. 1% Source: EGIS 2018 3.2.2 Improving urban mobility should help trigger agglomeration economies 30 Improving road traffic management around the PAC will help ease congestion and boost the port’s efficiency Enhanced traffic management around the PAC will improve the competitiveness of the logistics chain 32 Location of the PAC in Cotonou and the urban environment Cotonou experiences significant levels of congestion, both periodic and occasional, which has a high impact on freight transport due to the uncertainty it generates in travel times. Road congestion has two main effects on trucking: the time needed to cross the urban agglomeration increases during peak hours and the fuel consumption doubles (average travel time for truckers is 10-15% higher than baseline time during off-peak hours and 65% to 115% higher during morning rush hours). Ultimately, urban congestion increases the average cost per ton of freight carried by CFAF 332, according to 2016 estimates (EGIS 2018). This situation is likely to affect the logistical fluidity and consequently the competitiveness of the PAC. On the other hand, the significant volume of trucks that arrive at the port do not usually enter immediately, a situation that generates significant waiting lines on the side of the road. This greatly reduces the capacity of the adjacent roads and generates security problems and air pollution around the port (heavy vehicles are often very run down; Afrique Atlantique 2018). The PAG projects Asphaltage and CONOCO under implementation plan to ease this bottleneck. Continued improvement in mobility around the PAC should further reduce congestion (Appendix 9). Source: Google Maps 31 3.2.2 Improving urban mobility should help trigger agglomeration economies FINANCING THE TRANSPORT SECTOR AND STRENGTHENING 3.3 THE REGULATORY FRAMEWORK Financing the transport sector sustainably and improving the regulatory framework are crucial pillars of a modern transport sector that serves both people and firms. As in many LMICs, Benin’s financing needs in infrastructure are large – adequate prioritization is paramount, as is increased private participation. Improving the regulatory framework and governance structure can yield large gains. 32 Public investment in the transport sector remains moderate 3.3.1 Large financing needs call for The share of commodities in the prioritization and stronger planning External financing averaged 23% of the Execution is low due to externally A 33 export budgethas over 2011-2020 B 34 …but it remains above financed projects most peers With a volatile transport budget and substantial needs, enhanced basket declined over time… prioritization and planning are needed. Most of the annual budget of 100 7.0% 400 80% the Ministry for Infrastructure and Transport (MIT) is domestically- 300 60% financed, with a volatile share of externally-financed sources that has CFAF bn averaged 23% over 2011-2020 (a 33% decline from the previous 169 136 50 2.0% 200 40% decade). The overall committed budget as a share of the national 108 101 89 83 71 68 budget has seen an uptick in the last two years, linked to the PAG 57 50 48 48 100 20% 41 33 33 30 flagship projects. In 2019-2020, it was 5.3% of the national budget, 0 -3.0% - 0% pushed up as the sector was prioritized to support growth and job 2018 2011 2012 2013 2014 2015 2016 2017 2014 2018 2011 2012 2013 2015 2016 2017 2019 2020 creation during the COVID-19 pandemic. As the country exits the crisis, Internal financing Budget commitment the large investment needs in the transport sector will have to be External financing Budget allocation adequately prioritized and planned in a context of fiscal consolidation MIT budget / National budget Execution (chapter I). Strengthening the Public Investment Management (PIM) framework will be crucial to ensure returns on investments, including Openness to services exports is lower through adequate prioritization. C Capital expenditure is the majority of D Net FDI inflows remain 35 than all peers (2011-2018) 36 … and mostly in the roadbelow sector peers MIT’s allocated budget… Most of MIT's budget is allocated to capital expenses, mainly in the Others road sector. Capital expenses averaged 80% over 2011-2020. Despite 6% 9% 2% 17% 15% 10% this, the values are relatively low in absolute terms, just over US$ 60 8% Maritime, river and million in 2018. However, rural roads are financed from FADeC 19% lake transport (commune) funds, which add to this budget. Within the transport 85% 88% 85% 76% function, most of the committed budget (more than 95% in recent 77% 64% Air transport 86% 83% 84% 74% 93% years) corresponds to the road sector due to the PAG projects. 71% 78% 81% 84% 52% Road transport Execution appears low, reflecting two things: 1) the time mismatch between programmatic funding allocations and annual spending; and 2) Construction and the lesser execution of externally-financed projects, due to complex 2011 2012 2013 2014 2015 2016 2017 2018 repair of roads procurement processes. When measured against annual spending, the 9% 13% 7% 7% 3% 4% 4% 3% Capital transfers General transport execution of domestically-financed transport investments is the highest 2011 2012 2013 2014 2015 2016 2017 2018 Investments made by the State administration Personal, Functional and Transfer expenses of all sectors in the Public Investment Plan (PIP). In 2020, it was 98.9% for capital spending and 75.9% for recurrent spending. Source: Benin Boost, Notes: percent of total 33 3.3.1 Large financing needs call for prioritization and stronger planning Transport represents one quarter of the Public Investment Plan The PIP has increased in terms of both allocated and 37 PIP amounts peaked in 2017 executed amounts in recent years, with the MIT representing a significant portion 900 800 The PIP encompasses three main sectors: productive sectors (59%); social sectors (29%); and public administration (12%), in 700 line with the PAG. Different sources are used to finance it: the national budget finances half, with the remainder split between 600 loans (38.4%) and grants (15.9%). The credits allocated have CFAF bn increased since 2012, peaking in 2017. 500 In 2019, the PIP included 200 projects and programs for a total 400 allocated amount of CFAF 425 billion (5% of GDP), including 25 projects/programs in the transport sector. The sector is the 300 second-most important for both amount and projects, after the Ministry of the Environment and Sustainable Development. 200 While the overall level of execution remains adequate, at close to 70% on average (excluding 2017), several hurdles prevent higher 100 execution rates – including problems with the PIM and public procurement processes. Most notably, these include slow 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 processing of public contracts, late validation of working plans, Expected amounts 310 272 273 298 406 279 808 469 425 difficult access to the Integrated Public Finance Management System (SIGFIP), weak financial capacity of companies, Ordered amounts 194 173 240 203 346 169 264 336 301 insufficient budget allocations, insufficient ordered resources, Execution rate (ordered basis) 62% 64% 88% 68% 85% 61% 33% 72% 71% and delays in data transmission (MPD 2020c). Source: MPD 2020c 34 3.3.1 Large financing needs call for prioritization and stronger planning Limited road user charges undermine road maintenance Financing roads, particularly periodic maintenance, Financing for road maintenance relative to needs has 38 is a major challenge due to limited revenue sources declined steeply Road maintenance has traditionally been carried out by the Road Fund (Box 3.6), but it is now being transferred to a 1.00% 76% 80% 73% parastatal. It was initially expected to cover the full cost of maintenance, but limited sources of funding – covering only 30% of 70% needs – have prevented its from adequately fulfilling this role. Fuel 0.80% 60% taxes, vehicle-related fees and toll revenues are the main funding 60% sources for road infrastructure. On average, the fuel levy makes up 0.73% to 76% of revenues in SSA, ranging from 100% in Senegal and 50% 0.60% 0.67% Guinea to about 30% in Niger (World Bank 2019). In Benin, fuel taxes have historically been low due to fuel smuggling from Nigeria. 0.57% 36% 35% 40% Other resources are mobilized to supplement that limited income, 33% mostly transit fees and tolls – but are insufficient to cover periodic 0.40% 30% 25% road maintenance. Recently, the creation of the Society of Road Infrastructures (SIRB) to administer and develop roads (SSTAP 2019) 20% led to the dissolution of the Road Fund. As it is being set up, 0.20% 0.27% 0.25% 0.25% funding sources should be carefully analyzed in terms of 0.23% 10% competitiveness and affordability. Road asset management in general remains weak. Road data 0.00% 0% management systems are poor and hindered by the lack of annual 2009 2010 2011 2012 2013 2014 2015 updates. The SIRGPR (Règlementation et de la Gestion du Patrimoine Routier) has the oversight function. However, weak capacity for Allocated budget for road maintenance / Estimated needs programming, bidding, contracting and controlling maintenance Allocated budget for road maintenance / GDP operations is a continuous bottleneck (BOAD 2015). The standard maintenance works tender takes between 6 and 12 months. Capacity of local SMEs for carrying out maintenance works is low. Spurce: BOAD 2015 35 3.3.1 Large financing needs call for prioritization and stronger planning Box 3.6 Towards the next generation of Road Funds? Fuel taxes, vehicle-related fees and toll revenues are the main funding sources for road infrastructure In general, these resources can be channeled through a Road Fund (RF) or go to support a budget allocation, in addition to other public funds, whether sourced from tax revenues or debt. Road Funds gather most of their resources from road user charges (RUCs), and the highest share still comes from fuel levy revenues. The second and third largest components of RUC revenues are vehicle license and registration fees, and tolls. Unfortunately, in ECOWAS, the information on actual spending and on-budget transfers is not always well disaggregated to distinguish maintenance and rehabilitation. Moreover, many road authorities do not publish these figures. However, the levels of resources vary widely across those ECOWAS countries with Road Funds but remain insufficient to cover the cost of routine and periodic maintenance. The constant maintenance backlog forces Road Agencies to undertake spot reconstructions when sections of the road network have reached a condition where maintenance is no longer a viable technical solution. This explains why a growing number of them have requested amendments to their articles of incorporation and by-laws to include these activities. Given the fragility of RFs in SSA, there have been significant efforts to promote an upgrade to what is known as the 3rd generation of RFs (3G-RF). Compared to 2nd generations, the focus is on strengthening funding sources and amounts, the scope of works to be carried out, and governance and overall autonomy. Increasing private sector participation in the sector is also an objective of 3G-RFs. However, there are still many limitations to achieve this in most countries in SSA. Low levels of affordability by users and relatively contained traffic limit the bankability of many projects. In fact, there are not many cases of toll roads in the region(i) and PPP examples are limited. Traffic along the key regional corridors in the ECOWAS region is moderate to heavy with the most heavily used routes typically in poorest condition (i.e., the two gateways into Burkina Faso, and the Cotonou-to-Niamey route). 3rd generation RFs might be still a long way off in SSA. First, countries need to improve the governance of the sector and focus on domestic revenue mobilization to generate a stable source of funding for periodic maintenance. Overall reforms to develop the business environment, the rule of law and deepening the financing sector will also be crucial to ignite the transformation. Examples are Abidjan Lagoon Toll Bridge in Côte d’Ivoire, the Lekki-Epe Expressway in Nigeria, and Dakar Diamniadio Toll Road in Senegal, amount to more than US$1.2b of (i) expected investment at the time of financial closure. Source: World Bank ECOWAS InfraSAP, forthcoming; World Bank 2019. 36 3.3.1 Large financing needs call for prioritization and stronger planning Private participation in infrastructure is still nascent in the region As for other countries in the region, it has been difficult to set up private financing schemes in transport 39 Total PPP capital stock is limited but on par with structural peers infrastructure PPPs are emerging as an important mode for financing Public-private partnership (PPP) capital stock in billions of constant infrastructure projects in several developing countries. 2011 international dollars (2010-2017) In SSA, one of the main factors behind the transport infrastructure gap is the difficulty of finding funding due to projects’ limited 30.0 revenue generation capacity. While seaports, airports and some railroad projects (mining) have been able to bring on board the 25.0 private sector through PPP schemes, roads and secondary infrastructure are more problematic as they often lack the capacity to generate revenues from users, even when they are 20.0 economically profitable (WB ECOWAS InfraSAP). The creditworthiness of the sovereign to honor the commitment is also key. In fact, even when some funding from users and 15.0 taxpayers can be collected, the monetization of the future revenues in financing markets could lead to large discount factors 10.0 due to the inherent risk of this business and its enabling framework. The limited attractiveness of PPP so far in the region, including in Benin, reflects this reality. 5.0 As funding is limited, a carefully evaluation of the investment pipeline based on the economic return is crucial. Projects with - high potential to develop new business and job opportunities should be also analyzed in the context of their capacity to increase 1 tax collection and user revenues. A strong institutional and Ghana Sri Lanka Morocco Senegal Togo Rwanda Benin regulatory framework is paramount. Source: IMF Investment and Capital Stock Dataset, 2020 37 3.3.1 Large financing needs call for prioritization and stronger planning 3.3.2 Institutions and regulations governing transport and investment need strengthening There are several institutions governing the transport sector. The main supervision role falls under the Ministry for Infrastructure and Transport (MIT) (Appendix 10). The MIT’s mission is to develop and ensure implementation, monitoring and evaluation of the state’s general policy on land, sea and fluvio-lagoon, and aerial transport. It also oversees public works and other infrastructure, in accordance with the laws and regulations in force in the Republic of Benin. Among the MIT’s main roles is its regulatory role, that is, ensuring compliance with technical standards and regulations in all areas of its competence. In practice, many organizations reporting to the MIT are responsible for these tasks (e.g. Road Safety Agency). Meanwhile the Ministry of Planning and Development oversees the PIP, and the PAG projects are housed within the Presidency. In the communes, there is a communal network that governs the agricultural roads managed by the municipalities, partially funded by the Fonds d'Appui au Développement des Communes (FADeC) and supervised by the Commission Nationale des Finances Locales (CONAFIL) There is a disconnect between urban passenger transport and other modes. Currently transport legislation is mainly focused on national and extra-urban road networks, intercity and goods transport, and the role of the government and its agencies in these areas. The role of the government in urban mobility is poorly defined, and the concept is not emphasized in the sectoral legislation. The Ministry for Sustainable Development has a more prominent role regarding urban transport. Municipalities have limited regulatory powers for urban transport and management due to lack of funding. Overall, transport regulations are not well enforced, despite the adoption of regional standards, because of weak implementation capacity and oversight. The weak regulatory framework encompasses road safety norms, vehicle standards, and weight regulations. For example, truck overloading is a common practice (concerning 80% of trucks). The SIRGPR theoretically oversees the norms and procedures for vehicle weights and axel loads of heavy weight vehicles transporting goods – in line with the 2004 WAEMU regulations – but in practice oversight is limited. Benin should rely on regional initiatives and strengthen their implementation to increase standards. See more: Leveraging regional initiatives to meet international standards (Box 3.7). 38 3.3.2 Institutions and regulations governing transport and investment need strengthening 40 Benin’s PIM framework is better than peers’ in most areas Stronger public investment management is needed to increase efficiency and returns on investment The quality of public investment depends on the efficiency of the PIM framework. On average, countries lose over one-third of potential benefits from infrastructure investment due to inefficiencies (IMF 2019). Globally, poor project appraisal, rent-seeking, corruption in procurement processes, and inadequate maintenance, are all examples of inefficiencies that are costly to societies. Quality infrastructure is closely linked to good infrastructure governance (IMF 2020b). Efficient public investment management has been found to double the growth impact of public investment (IMF 2015). Understanding the quality of PIM is thus crucial to increase public expenditure quality and its contribution to growth and poverty reduction. Benin’s institutional framework is of high quality, but ineffective implementation is limiting the sustainability and quality of investments (IMF 2020a). Benin has a relatively complete and high-quality PIM framework, outperforming its peers, both in the WAEMU and SSA region. However, the effectiveness of this framework can continue to be improved and significant progress has been made since 2017 that can be enhanced. The aim is to make the various phases of the investment management process more efficient. According to the PIMA, project selection and ex-ante and ex-post evaluations are not carried out in a systematic way. Outside of large- scale, externally funded projects, formally established feasibility studies and cost-benefit analyses are not systematically conducted or reviewed. Procurement processes are slow and significantly delayed, although the adoption of the new procurement code in 2020 has simplified procedures, reduced transaction costs, and improved accountability. These changes have made processes more competitive, increased bidder participation, and cut the time to award and sign contracts in half. Source: IMF 2020a 39 3.3.2 Institutions and regulations governing transport and investment need strengthening Benin’s capacity to implement sustainable PPPs is average Implementation of the PPP framework needs improvement The PPP framework was put in place in 2017-2018 with the promulgation of 41 Overall score 42 Regulations the PPP Law 2016-24, and various implementing decrees. Key agencies include the PPP Support Unit, a line ministry level body that reports to the Council of 69 65 59 81 72 Ministers and is responsible for providing technical support at all stages of the 56 61 process, including the review of the quality-price ratio; the National Procurement 35 41 28 Control Department, overseeing the call for tenders; and the Public Market Regulatory Authority, which mediates disputes between private partners and contracting authorities. Ghana Togo Ghana Togo Senegal Senegal d'Ivoire d'Ivoire Benin Benin In its current form, the legal framework has shortcomings when compared Côte Côte to international best practices. The main issue relates to the broad definition of PPP, which allows all standard contracts to be designated as PPPs. Rules and oversight are also limited: public disclosure is not required of all contracts signed 43 Institutions 44 Maturity by the government or commitment authorizations issued by Parliament; nor is the state obliged to respect ceilings on financial commitments in connection with 87 75 66 60 PPPs, whether they are implicit or explicit. Finally, budgetary control during 70 56 61 61 44 execution is not specified and there are no rules regulating unsolicited proposals (IMF 2020a). According to the Infrascope Index (a benchmarking tool evaluating 1 the capacity to implement sustainable and efficient PPPs), Benin's performance is average against comparator countries. Its largest deficiencies are in the financing component that measures the financing facilities for infrastructure projects. Ghana Togo Togo Ghana Senegal Senegal d'Ivoire d'Ivoire Benin Benin Côte Côte In the region, only Nigeria has comprehensive and specific PPP legislation good enough to support private sector participation in infrastructure projects. Institutional and regulatory imperfections notwithstanding, many countries have 45 Investment & business climate 46 Financing completed PPP transactions in the port sector. The lack of prior experience in the design, negotiation and award of concessions in the infrastructure sector, and 72 72 64 64 59 specifically in the port industry, has however given a clear advantage to private 57 48 45 negotiators (WB ECOWAS InfraSAP). Although sensitive, knowledge exchange can 32 32 be enhanced at the regional level – both in WAEMU and ECOWAS – to strengthen the bargaining position of conceding authorities. Benin adopted Law No. 2016-24 of June 28th, 2017, that set up the legal framework of the PPP. Five decrees have Ghana Togo Ghana Togo Senegal Senegal d'Ivoire d'Ivoire Benin Benin been implemented: Decree No. 2018-028 of January 31st, 2018, related to the ad hoc commissions in charge of PPP Côte Côte procurement procedures; Decree No. 2018-156 of May 2nd, 2018, creating the “Cellule d’appui aux PPP” (PPP Unit); Decree No.2018-039 of January 31st, 2018, related to the control and regulation of PPP procurement and operation; Decree No. 2018-424 of September 19th, 2018, that set up PPP’s catalogue for the whole country; and Decree No. Source: EIU 2019, Infrascope Index 2018-360 of 31st July 2018 that defines the tax regime of PPP contracts in Republic of Benin. Pursuant to the PPP law, delegations of public service are now governed by the above-mentioned PPP law instead of the Public Procurement Code. (CPCS 2020) 40 3.3.2 Institutions and regulations governing transport and investment need strengthening Box 3.7 Leveraging regional transport initiatives ECOWAS has put in place a transport program to facilitate the movement of people, goods, and services in the region. One of the main activities is the regional road transport and transit facilitation program, which emphasizes a Joint Border Posts (JBP) program (including infrastructure, legal framework and operational manuals). ECOWAS is also working on an axle load harmonization policy, the Road Transport Observatory and the Nigeria-Cameroon Multinational Highway and Transport Facilitation Program developed as part of the Trans-Africa Highway program. Further, the ECOWAS Commission is partnering with the West African Road Safety Organization (WARSO) to enhance the capacity of authorities, road safety management and safety awareness. The ECOWAS Inter-State Road Transport Convention allows pairs of member states to conclude bilateral treaties. While it is difficult to ascertain whether freight sharing rules are a key cause of high transport prices in the region, they do encourage over supply of transport capacity and collusion among truck operators when it comes to pricing their services. In West and Central Africa where these conventions exist, the price of long- haul trucking was higher than in the rest of Africa because the over supply of transport capacity resulted in chronic underutilization of truck capacity (i.e., lower or lowest average distance per truck per year in all of Africa) which, in turn, resulted in a continuous increase in tariffs to cover higher direct and fixed costs per km operated. ECOWAS transport agreements give specific percentages of the freight passing through a coastal country’s port to a landlocked country to the truckers of each of the two countries. Typically, ‘strategic’ goods are 100% allocated to the landlocked country, while non- strategic goods are allocated 2/3 to the landlocked country and 1/3 to the coastal country. Several such bilateral treaties exist, and shippers’ councils from landlocked countries oversee their application. Some other initiatives also exist at the WAEMU level, though they could be strengthened. For example, in the area of PPPs, the WAEMU Commission holds some oversight capacity. The contested concession of the second container terminal in Abidjan was disputed on the basis of competition regulations both in Côte d’Ivoire, with the public procurement agency, and regionally, with the WAEMU Commission. This raises the option of strengthening the advisory role of the regional commission. Source: World Bank, ECOWAS InfraSAP forthcoming. 41 3.3.2 Institutions and regulations governing transport and investment need strengthening POLICY OPTIONS 3.4 42 Key policy options (1/2) Timeline for Fiscal costs implementation Regulations and planning for transport infrastructure and services 1. Strengthen road asset management. Ensure the new SIRB has identify dedicated and predictable funding sources for road maintenance and rehabilitation based on the ‘user-payer’ principle to apply structured user charges to cover the full cost of road maintenance and rehabilitation, traffic management, and road safety enhancements (for example, a special tax on Short term High vehicle ownership or a direct charge on vehicle use if adequate distributional assessment is carried out); and reinforce the capacity of road agencies and asset management systems. 2. Strengthen the prioritization tools for rural road investments. Multi-Criteria Decision (MCD) models have become widely Low used as the main prioritization tool for road investment in recent years. They have the flexibility of being combined with Medium-term (with potential fiscal other mechanisms such as participatory approaches and being adaptable to policy priorities. gains) 3. Enhance the oversight and monitoring capacity for road safety and vehicle standards. The most urgent road safety challenge in Benin is protecting pedestrians, who make up most of road fatalities, through the Safe System approach (safe roads and roadsides, safe vehicles, safe road users, safe speeds, and effective post-crash care). Specific recommendations Short term Low to medium include establishing a high-level national safety council, conducting safety audits on all new road and road improvement designs, and developing a comprehensive national road safety program. Institutional capacity to manage road safety should be strengthened to improve interagency coordination. 4. Improve efficiency in the trucking industry while preventing road deterioration. Conduct a proper assessment of the bottlenecks to professionalizing the sector, including the functioning of the transport market. Facilitate the renewal of the truck fleet and streamline trade and transit procedures. Effective action against vehicle overloading cannot be limited to the installation and operation of weighing stations, not even with the full enforcement of axle-load regulations. It must be Medium-term Medium extended to all the sector stakeholders responsible for truck overloading, especially transport companies, shippers, and logistic operators. The issue should be tackled at the regional level and at different subsector levels (transport liberalization, port operation reforms and coordinated regional actions) to avoid distortions in competition and traffic diversions. Notes: short-term (1 year); medium-term (2-3 years); long term is +3 years; fiscal implications are estimated as low: affordable within current spending structure; medium: requires budget reallocation; high: need further reform, funding sources and DRM 43 Policy Options Key policy options (2/2) Timeline for Fiscal costs implementation Urban mobility 5. Improve road traffic management to ease congestion in Cotonou-PAC. The CONOCO and Asphaltage projects address part of this challenge. Continuing to reinforce traffic management can complement the infrastructure investment (e.g. Medium term Low regulations for peak/off peak heavy vehicle traffic for example; and light infrastructure projects to regulate traffic). 6. Define the institutions and mechanisms regulating and planning urban mobility, Strengthen the role of municipalities regarding planning and funding of urban mobility, and enhance interagency coordination with key agencies in charge of road Long term Low safety and environmental regulations/vehicle standards. Funding and financing 7. Strengthen the PPP framework and create knowledge-sharing mechanism to improve capacity. Improving private sector participation in infrastructure will become more important in the coming years as countries exit COVID-19. Priorities in Low Short term Benin are to enhance the definition of PPP; strengthen rules and oversight mechanisms; and ensure budgetary control during (with potential fiscal gains) execution. 8. Address the main bottlenecks in the PIM framework and public procurement. To enhance the PIM framework, project selection and ex-ante and ex-post assessments should be regulated and made systematic. Mechanism to regulate the pre- Low Short term financing unsolicited proposals could be put in place. The new procurement law (2020) needs to be fully implemented with (with potential fiscal gains) adequate implementing decrees. Notes: short-term (1 year); medium-term (2-3 years); long term is +3 years; fiscal implications are estimated as low: affordable within current spending structure; medium: requires budget reallocation; high: need further reform, funding sources and domestic revenue mobilization. 44 Policy Options REFERENCES AFDB. 2018a. “Benin Data Portal https://benin.opendataforafrica.org/”. African Development Bank Group. AFDB. 2013. “The Africa Infrastructure Development Index”. African Development Bank Group. AFDB. 2014. “Parakou Urban Transport Project”. African Development Bank Group. AFDB. 2018b. “The Africa Infrastructure Development Index”. African Development Bank Group. AFDB. 2020. “Africa Infrastructure Knowledge Program http://infrastructureafrica.opendataforafrica.org/”. African Development Bank Group. Afrique Atlantique. 2018. “Moderniser les ports Ouest-Africains”. Éditions EMS. Afrique Atlantique. 2020. “Gouverner ports, transports et logistique à l’ère du numérique”. Éditions EMS. Afrobarometer. 2018. “Local governance in Benin. A guarantee of sustainable development?”. Afrobarometer. Afrobarometer. 2019. “Round 7 Survey Data”. Afrobarometer. BOAD. 2015. “Etude sur l’entretien routier dans les pays de L’union Economique et Monetaire Ouest Africaine (UEMOA)”. Banque Ouest Africaine de Développement. CONAFIL. 2018. “Les finances locales du Benin 2016”. Commission Nationale des Finances Locales. CPCS. 2020. “ECOWAS Region PPP Framework Review and Harmonization”. CPCS. DHL. 2020. “DHL Global Connectedness Index 2020”. Deutsche Post DHL Group. EC. 2016. “Evaluation of EU support to the transport sector in Africa 2005-2013”. EuropeAid - European Commission. EDI. 2019. “Introduction to the Benin Institutional Diagnostic”. Economic Development & Institutions. EGIS. 2018. “Études d'aménagement du Contournement Nord-Est et des berges de la lagune de Cotonou puis l'assistance au Maitre d'Ouvrage pour le recrutement d'un concessionnaire”. EGIS. EIU. 2017. “Infrascope: The Enabling Environment for Public-Private Partnerships - Benin”. The Economist Intelligence Unit. EIU. 2019. “Infrascope Database 2019”. The Economist Intelligence Unit. FEAO. 2020. “Evaluation de la situation actuelle de passage des camions chargés de marchandises, en particulier en transit en provenance du Port de Cotonou, au Poste de Contrôle Juxtaposé (PCJ) de Malanville (frontière Bénin-Niger)”. Programme de Facilitation des Echanges en Afrique de l'Ouest Foussemi, G.M. et al. 2014. “Strategies for Sustainable Urban Transport: A Case Study of Cotonou, Benin”. International Journ al of Engineering Research in Africa. Foussemi, G.M. et al. 2013. “Urban Transport Issues in Cotonou: Analysis and Perspectives”. Advanced Materials Research. Hounsounou, A. et al. 2021. “Application of fuzzy logic at the Port of Cotonou (Benin / West Africa) in analysis of port logistics viab ility”. IJIER. IATA. 2018. “Feasibility study for a common policy on aviation charges, taxes & fees for ECOWAS States”. International Air Transport Association. IMF. 2020a. “Public Investment Management Assessment”. International Monetary Fund. IMF. 2020b. "IMF Investment and Capital Stock Dataset, 2019”. International Monetary Fund. INSAE. 2018. “Annuaire statistique 2018”. Institut National de la Statistique et de l'Analyse Economique du Benin. INSAE. 2019a. “Tableau de bord social 2015”. Institut National de la Statistique et de l'Analyse Economique. INSAE. 2019b. “Tableau de bord social 2016”. Institut National de la Statistique et de l'Analyse Economique du Benin. JRC. 2020. INFORM Risk Index 2021. Joint Research Centre of European Commission. 45 REFERENCES MDGL. 2017. “Plan de Developpement Communal. Deuxième Génération. 2018 - 2022”. Ministere de la Decentralisation et de la Gouvernance Locale. MEF. 2020. “Document de Programmation Budgétaire et Économique Pluriannuelle 2021 2023”. Ministere de l‘Economie et des Finances. MIT. 2009. “Annuaire Statistique 2001-2008”. Ministere des Infrastructures et des Transports du Benin. MIT. 2011. “Annuaire Statistique 2009-2010”. Ministere des Infrastructures et des Transports du Benin. MIT. 2013. “Annuaire Statistique 2011-2012”. Ministere des Infrastructures et des Transports du Benin. MIT. 2017. “Annuaire Statistique 2013-2016”. Ministere des Infrastructures et des Transports du Benin. MPD. 2018. “Plan National de Développement 2018-2025”. Ministère du Plan et du Développement. MPD. 2020a. “Evaluation sommaire de la mise en oeuvre des ODD au Bénin”. Ministère du Plan et du Développement. MPD. 2020b. “Rapport sur les indicateurs des objectifs de developpement durable du Benin, edition 2019”. Ministère du Plan et du Développement. MPD. 2020c. “Rapport d’exécution du programme d’investissement public au 31 décembre 2019”. Ministère du Plan et du Développement. NTU. 2019. “Baseline study on the procedures and crossing times of vehicles and passengers at the Seme -Krake and Noepe JBPs, including Aflao- Kodjoviakope and Akanu borders”. NTU International. OICA. 2015. “Motorization rate Database”. International Organization of Motor Vehicle Manufacturers. PIDA. 2020. “PIDA Progress Report 2019-2020”. Programme for Infrastructure Development in Africa. Republic of Benin. 2019. “Project CONOCO”. Republic of Benin. UNCTAD. 2020a. “Port Liner Shipping Conectivity Index”. United Nations Conference on Trade and Development. UNCTAD. 2020b. “Review of Maritime Transport 2019”. United Nations Conference on Trade and Development. PRB. 2016. “Programme d’actions du gouvernement 2016-2021”. Présidence de la République du Benin. SEFACIL. 2021. “Cotonou : terre d’innovations portuaires” in Perspectives Portuaires Africaines N1. Fondation SEFACIL. SSATP. 2018. “West and Central Africa Trucking Competitiveness”. Africa Transport Policy Program. SSATP. 2019. “Benin - Policies for Sustainable Mobility and Accessibility in Cities. Diagnostic Study”. Africa Transport Policy Program. SSATP. 2020. “Benin - Policies for sustainable accessibility and mobility in cities”. Africa Transport Policy Program. TFWA. 2019. “Corridor Assessments Report”. Trade Facilitation West Africa Program. WBG. 2014. “Benin Economic Update”. World Bank Group. WBG. 2018. “Country Partnership Framework for Benin”. World Bank Group. WBG. 2019. “Preliminary assessment of ECOWAS States’ status of liberalization”. World Bank Group. WBG. 2020. “Railways in Sub-Saharan Africa”. World Bank Group. World Bank, 2016. Making the Most of Ports in West Africa. WFP. 2018. “Logistics Capacity Assessment”. World Food Programme. WTO. 2018. “Trade Policy Reviews”. World Trade Organization. WHO. 2018. “Global status report on road safety 2018”. World Health Organization. 46 TERMS AND DEFINITIONS Agglomeration economies are the benefits that come when firms and people locate near one another in cities and industrial clusters. These benefits all ultimately come from transport Agglomeration costs savings: the only real difference between a nearby firm and one across the continent is that it is easier to connect with a neighbor. Of course, transportation costs must be economies interpreted broadly, and they include the difficulties in exchanging goods, people, and ideas (Glaeser 2010). A term used to describe the set of firms, workers, and activities that operates outside the legal and regulatory framework or outside the modern economy (Perry et al 2007). It denotes Informality activities ranging from legally constituted companies to workers in subsistence activities, but the latter are more prevalent. Market access A measure of market access size, estimated as land-based travel time to the nearest densely-populated area. potential Nigeria’s border The period between August 2019-December 2020, during which Nigeria unilaterally closed its land border with neighbors. closure Ports are classified into various types considering a variety of factors such as location, depth, purpose, and ship sized There are five major types of natural or man-made ports: inland ports, fishing ports, dry ports, warm water ports and seaports. Depending on port terminal capacity and logistics, some ports are classified as transshipment ports, where several Port classification different shipping lines operate and carry out freight transfers. Dry ports (sometimes referred to as an inland port) are inland intermodal terminals directly connected by road or rail to a seaport, operating as a center for the transshipment of sea cargo to inland destinations. The Rural Access Index (RAI) measures the proportion of the rural population who live within 2 km of an all-season road. It is included in the Sustainable Development Goals as indicator Rural Access Index 9.1.1, providing a way of measuring progress towards Goal 9 and Target 9.1. Originally developed by the World Bank in 2006, the RAI is among the most important global development indicators in the transport sector. When policymakers talk about “trade facilitation”, they are referring to a specific set of measures that streamline and simplify the technical and legal procedures for products entering or Trade facilitation leaving a country to be traded internationally. As such, trade facilitation covers the full spectrum of border procedures, from the electronic exchange of data about a shipment, to the simplification and harmonization of trade documents, and the possibility to appeal administrative decisions by border agencies (OECD). World Bank country World Bank country classifications by income level (2020-2021) classify the world’s economies into the following four income groups based on gross national income (GNI) per capita classifications by (current USD based on Atlas method exchange rates): low (<1,036), lower-middle (1,036-4,045), upper-middle (4,046-12,535) and high-income (>12,535) countries. In sub-Saharan Africa, income level high-income countries (HICs) include Mauritius and Seychelles, and upper-middle income countries (UMCs) include Botswana, Equatorial Guinea, Gabon, Namibia and South Africa. A zémidjan (or zem) is a type of taxi found in Benin, West Africa. The highest concentration is found in the largest city, Cotonou, where there are an estimated 72,000. Zémidjans are Zemidjan motorcycles that carry one to two passengers for short distances in towns. The fares are entirely negotiable. 47 Introduction APPENDIX Chapter III. Connecting People and Markets for Economic Transformation 48 1. Benchmarking – structural, and aspirational peers and regional comparisons To identify Benin’s comparator countries, the team combined inputs from the Country Scan Tool with local country context. A set of criteria was used to select countries (see Chapter I). 01 Structural peers 02 Aspirational peers Togo, Rwanda and Senegal These Ghana, Morocco, and Sri Lanka. countries have similar economic These countries are LMICs that and structural characteristics as set a good development Benin. precedent, having started from a similar position as Benin. Criteria for selecting structural and aspirational peers 03 WAEMU & ECOWAS 04 Other categories • GDP per capita (constant 2010 US$) • Population 2019 WAEMU countries include Benin, Benin will also be compared with • Trade (% of GDP) Guinea-Bissau Burkina Faso, SSA average, low-income (LICs) • Agriculture, value added (% of GDP) Côte d’Ivoire, Mali, Niger, and lower-middle income (LMICs) Senegal, and Togo. country averages. • Human Capital Index • Country Policy and Institutional Assessment ECOWAS countries include the In this chapter, Benin will also be WAEMU countries and Cabo compared with relevant Verde, The Gambia, Ghana, competitors for road and port Guinea, Guinea-Bissau, Liberia, infrastructure. Nigeria, and Sierra Leone. 49 Appendix 2. Informal cross-border trade Official trade statistics for Benin and Nigeria hide huge unrecorded informal trade between the two countries. Benin and Nigeria have a long history of informal cross-border trade (ICBT) linked to long-standing cultural affinities (Golub 2012) common to various countries in West Africa. Togo, Benin, Nigeria and other countries are characterized by north-south ethnic and religious divides, providing an impetus for east–west trade that crosses borders. Nigeria’s high levels of protection, poorly functioning ports, and currency controls have incentivized these linkages. As a result, Benin imports – for re-exporting to Nigeria – a large quantity of consumer goods subject to import protection in this country (second-hand cars, cloth, rice and frozen poultry stand out). In the opposite direction, Benin imports a large proportion of fuel from Nigeria, where consumer prices have historically been highly subsidized. It is estimated that close to 80% of fuel consumed in Benin is informally imported from Nigeria (it is called Kpayo). This two-way cross-border trade accounts for a large share of Benin’s income, tax revenue (through imports) and employment. Re-export activities are organized are both official and unofficial. In the first case, imported goods are declared for re-export or for transit to Nigeria. In the second case, imported goods are declared for transit to neighboring landlocked countries or for the domestic market, and later diverted to Nigeria through a network of informal intermediaries. Either way, the import process is fully formal and legal. The unofficial (illegal) aspect occurs when customs rules are bent or when these goods are smuggled into Nigeria. Goods can cross the border by land or water and there is service infrastructure (warehouses, markets, etc.) along the border that supports these operations. Boosting unofficial re-export trade as a pillar of Benin's economy has considerable downsides, mainly vulnerability to changes in economic conditions and trade protection policies in Nigeria, which can affect government tax revenues and negatively impact on the activities of the Port of Cotonou and other service sectors. For more details see Chapter IV. Source: EDI 2019 (INSAE) 50 Appendix 3. Port calls and performance statistics All ships: port calls, turnaround times, vessel average size, 2019 The circle size indicates the number of port calls Benin performs well regionally for the size of 50,000 Average size (GT) of vessels Nigeria Sri Lanka vessels calling at ports and turnaround times 40,000 Togo 30,000 Benin 20,000 Senegal Morocco Côte d'Ivoire Ghana 10,000 0 The figures present the correlation between the number of 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 port calls (for all ships and container ships), the average size of ships that call at the country’s ports and the median time Median time in port (days) spent at the port. Container ships: port calls, turnaround times, vessel average size, 2019 Benin stands out for receiving relatively large vessels on average compared to other regional countries, whether all The circle size indicates the number of port calls 70,000 vessels or only container ships are considered. Average size (GT) of vessels 60,000 Sri Lanka Togo Nigeria It is remarkable that turnaround times are relatively short in 50,000 Benin 40,000 Morocco both cases, below the levels recorded by Togo, Ghana, and 30,000 Côte d'Ivoire. On the other hand, if ships are larger, other 20,000 Senegal Côte d'Ivoire Ghana things being equal, turnaround time should be longer, as 10,000 there will be more cargo to be loaded and unloaded. Ports 0 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 with shorter turnaround times tend to be more attractive to shippers and carriers rather than container ships that can Median time in port (days) generate higher revenue. Source: UNCTAD 2020b 51 Appendix 4. Port concessions in West Africa Since the mid-2000s, the spread of port concessions in West Africa has led most port authorities to depart from the “service port model”, in which they are responsible for infrastructure and services, to become “landlord ports” with a focus on core strategic and regulatory functions. Despite the general move towards the landlord port model, the institutional structure for port management in West Africa differs across countries. In Anglophone countries, a national port authority usually has jurisdiction over all the ports in the country, with varying degrees of involvement in the operations, and sometimes a regulatory role. For instance, the Nigeria Port Authority assumes both landlord and regulatory functions and provides marine and related services across Nigerian ports. In Francophone countries, on the contrary, the norm is a dedicated port authority for each port, under the autonomous port model with more delegation of public decision making. Francophone countries more rarely have several ports, although some countries, such as Côte d’Ivoire, have more than one (Abidjan and San Pedro), with each having a separate port authority. In practice, most ports in West Africa have hybrid structures on the service-landlord continuum, and there are variations in public attributions both between and within countries. In addition to port authorities and terminal operators, many institutions are involved in port policy and management in West Africa. First, ministerial departments (primarily transport, infrastructure, maritime affairs, and commerce) are responsible for port policy formulation, legislation and planning at the national level. They oversee the activities of port authorities and are represented on their board, which can also include representatives of the Ministry of Finance, Prime Ministry or Presidency for the public sector representatives. Agencies in charge of public procurement regulation and privatizations can also be involved in the awarding and regulation of port concessions. Second, private and public institutions and professional associations represent the interests of port users and logistics service providers and are often represented on the board of ports in several countries. Some ports, such as the Port Authority of Abidjan and the Port Authority of Dakar, have even included on their board representatives of the landlocked countries they serve. The degree and manner of private engagement in the port sector varies with local conditions (social, economic, political, cultural, geographic, etc.), and different models of inclusion and administration have proved to be efficient. Evidence shows that private sector participation needs to be accompanied by other measures, such as strategic planning, institutional, legal, regulatory, and labor reforms. Even in the case of autonomous ports, central governments usually retain significant control for major decisions, notably for the terminal concession process. Additionally, the port authority may be more effective in enforcing compliance with contract provisions than in limiting abuses from monopoly power, ensuring a fair distribution of privatization gains, or promoting intra- or inter-port competition, as these could adversely affect its own revenue stream. Yet clarifying the roles of and responsibilities of government and its various entities is a challenge across continents. Source: World Bank, ECOWAS InfraSAP; Making Most of Ports in West Africa (World Bank 2015) 52 Appendix 5. Air fares, charges and taxes Charges and government taxes for regional and international flights Benin’s charges and government taxes for regional and international flights are higher than the Regional International ECOWAS Regional Average: $10,877 ECOWAS International Average: $12,700 ECOWAS average, although ticket prices are lower. While the higher taxes are a good revenue source in a context of low domestic revenue mobilization, it 17,312 should be harmonized within the ECOWAS region to 14,884 14,231 13,482 13,152 12,839 12,534 13,482 10,196 14,172 11,188 10,144 14,704 14,231 16,108 12,742 12,534 20,732 18,482 11,427 12,447 7,037 9,281 3,016 3,016 6,494 7,263 7,833 9,139 9,547 maintain its competitiveness. Benin Burkina Cape Verde Côte Ghana Guinea Guinea Liberia Mali Niger Nigeria Senegal Sierra The Togo Faso d'Ivoire Bissau Leone Gambia According to the International Air Transport Association (IATA), in 2018, ECOWAS average charges and government Source: IATA 2018,, Notes: CFAF taxes for regional and international flights were $10,877 and $12,700 (two times higher than in North Africa, and more than Average round-trip ticket prices and weight of passenger charges & government taxes 80% above the world average). These are slightly higher values in Benin, at 21% and 12% respectively, mainly due to Regional International the higher level of taxes in relation to its peers. 1,434 The average total charges and taxes for passengers are 1,308 1,180 1,164 1,154 1,116 1,111 1,042 1,011 $87.59 (regional) and $103.58 (international). Although Benin 967 930 896 827 763 758 681 25% 580 43% 565 42% 554 is also above most countries, the average round-trip ticket 38% 552 43% 516 514 38% 497 35% 494 23% 476 46% 475 33% 467 49% 464 36% 443 24% 439 22% 438 259 price is below the ECOWAS average: -2% and -25% for regional 25% 31% 20% 15% 15% 16% 20% 11% 30% 18% 26% 16% 17% 41% 24% 36% 19% 8% and international flights. This allows tax authorities to take Benin ECOWAS Burkina Cabo Cote Ghana Guinea Guinea Liberia Mali Niger Nigeria Senegal Sierra Gambia Togo advantage of the sector for domestic revenue mobilization in Average Faso Verde d'Ivoire Bissau Leone a context of limited domestic revenue sources due to high informality (chapter I). Source: IATA 2018, Notes: CFAF 53 Appendix 6. Subnational gains from improvements in the Dakar-Lagos corridor Lebrand (forthcoming) simulates the impacts of these improvements at the subnational level. From left to right the figures show the impact on real wages at the subnational level from (1) investing in transport infrastructure, (2) additionally removing transit delays along the corridor only; (3) removing all transit delays and cutting final border delays by half. Removing all transit delays in West Africa and cutting by half final border delays bring income gains for all regions in West Africa, even the most distant ones. More distant and isolated regions in the Sahel benefit little from all infrastructure investments happening along the corridor and borders. Regions in Nigeria also benefit relatively little from all these investments. The large size of the internal market explains the marginally smaller gains from better regional connectivity. Spatial gains (%) in real wages from the Dakar-Lagos Corridor and investments to remove transit delays Source: Lebrand (forthcoming) 54 Appendix 7. The distribution of population and economic activity Benin’s economic activity is concentrated Most population growth has taken Benin’s economic geography suggests in the south and near urban centers… place in southern areas and urban increasing concentration of economic while agriculture is in the north centers activity in the south and nascent secondary cities linked to agricultural production. Benin’s population growth in the last decade has been widespread across the country, with very few pockets of negative population growth. However, most of the gains have happened in urban centers (notably at Parakou, Benin’s third largest city) and in the southern tip around Cotonou, Porto Novo, and up to Bohicon. This pattern reflects both the growing urbanization of slowly developing secondary cities, and the southern agglomeration, and the prevalence of rural population in a country where 40% of employment is in the primary sector. Most of economic activity has increased in the South around Cotonou linked to the port and trade activities (here measured by average night light intensity in 2020). Agriculture is concentrated in the northern-central area around Parakou. Source: VIIRS and author’s calculations Source: WorldPop and author’s calculations 55 Appendix 8. Connectivity for human capital Spatial accessibility in health and education matters because schooling and health outcomes are determined by more than just the availability and quality of healthcare and schooling. They also directly depend on factors governing a person’s decision to invest in education and health (benefits and costs). Costs include both direct and indirect ones, with transport costs likely to be among the most important (World Bank 2021). In the poorest SSA countries, such as Sierra Leone, people spend around the same amount of money on travel to school as on school fees, and almost double the amount on travel to medical centers as the actual medical cost. Transport is not only a determining factor for accessing basic human-capital related 100 services – it can also influence capital formation for new generations. Poor physical 90 access to health facilities has been identified as an important contributor to reduced uptake of preventive health services, especially in low-income settings. In Haiti for 80 Adult Literacy Rate example, Gage and Calixte (2006) find evidence that women living in an area 70 connected to the nearest urban center by an asphalt road are 4 times more likely to 60 complete the recommended antenatal-care visits than those linked by unpaved 50 roads. Improved connectivity can also affect human capital development by reducing Correlation with RAI: 40 Adult literacy rate: 0.39 gender gaps. In Moroccan villages improved road access resulted in girls’ school 30 Primary school completion: enrollment increasing from 17 to 54% (Levy 2004). Girls were found to pay almost a 0.40 20 third more than boys for their daily commutes to school in Bosnia & Herzegovina Maternal mortality ratio: - due to safety and security considerations. A Stanford study of 15 European cities 10 0.23 showed that women rely more on public transport, and their travel patterns are 0 mainly linked to the childcare, which leads to multipurpose and multichain trips. 0 10 20 30 40 50 60 70 80 90 Finally, road crash injuries are the sixth leading cause of death globally for all age Rural Access Index groups, and the leading cause of death for the 15–49-year age group (GRSF 2014). Source: Transport Global Practice Narrative (2019) 56 Appendix 9. Projet Asphaltage: Enhancing Cotonou’s road infrastructure (1/2) To address the poor condition of the city's A1 Cotonou: Road infrastructure road infrastructure, the PAG aims to pave a significant number of streets, in addition to other projects Cotonou’s urban mobility problem is related to poor services and poor infrastructure. On the one hand, the transport service is limited. On the other hand, the condition of the streets, their poor sizing and the constant risk of flooding, contribute to congestion. The main axes are passable, but the Source: MDGL 2017 streets and alleys serving the districts which offer social services are almost impassable. A2 Cotonou: Projects included in the PAG In addition, there are traffic jams at all hours of the day. There is also an anarchic parking situation mainly linked to the lack of designated areas for this purpose (the situation is particularly critical around Dantokpa market and the PAC). To start addressing these, the PAG is boosting the number of surfaced roads with the Projet Asphaltage that contemplates paving 234 km of streets. It also contains an explicit effort to curb commuter traffic by relocating certain major traffic- generating centers: it plans to move administrative jobs to the Calavi area, to move the airport and the wholesale market out of the city center, and to create a car park and a logistics area Source: MDGL 2017 in the immediate vicinity of the port. Source: MDGL 2017, SSATP 2020, SSATP 2019 57 Appendix … and the CONOCO Project (2/2) Contournement Nord de Cotonou (CONOCO) is a flagship A4 Daily exchanges of vehicles project in the PAG One of the most important urban projects included in the PAG is the so-called CONOCO. It includes a 37 km highway bypassing Cotonou’s center in the north (linking the municipalities of Abomey-Calavi, Cotonou and Sémé-Podji) and a 5.2 km connection to the port. The aim is to keep vehicles associated with the Port of Cotonou and in transit on the Abidjan-Lagos axis outside the urban environment, freeing up the main axes of the city from this traffic. The total costs are estimated at CFAF 337bn (approx US$ 600 million (XX% of GDP). (includes land acquisition, construction and other costs). The project relies on private investment for a majority stake. A3 CONOCO Project Source: Republic of Benin 2019 Source: Republic of Benin 2019 58 Appendix 10. MIT organization chart Ministry of Infrastructure and Transport Organizations under MIT supervision Benin Society of Road General Inspection of National Civil Aviation Benin Airport Society Minister's office Infrastructures SA the Ministry Agency (ANAC) (SAB) (SIRB) National Center for National Meteorological National Shippers General Secretariat Public Works Testing Agency (METEO BENIN) Council of Benin (CNCB) and Research (CNERTP) National Land Beninese Maritime Departmental National Road Safety Central Directorates Technical Directorates Transport Agency Navigation Company Directorates Center (CNSR) (ANaTT) (COBENAM) Directorate of Directorate General of Directorate of Land Accident Investigation Beninese Port Handling Administration and Road Fund (FR) Infrastructures Transport Bureau (BAU) Society (SOBEMAP) Finance (DAF) Public Works Transport and Public Planning and Foresight Directorate of the Directorate of Fluvio- Autonomous Port of Equipment Company Works Training Center Department (DPP) Merchant Navy Lagoon Transport Cotonou (PAC) (SMTP) (CFTTP) IT and Pre-archiving Ports Directorate Department (DIP) Source: MIT web / MEF 2020 59 Appendix 11. Prioritizing rural road investment can be an efficient mechanism Governments with information and capacity Prioritizing rural road investment in Mozambique: selecting feeder roads constraints struggle to decide how to allocate limited by socioeconomic criticality and flood risk resources for infrastructure to maximize economic and social benefits. How and where to prioritize public funds in the rural roads sector? The methods used by governments to prioritize rural road investments have significantly evolved over time. They have ranged from those strictly considering economic returns, to the inclusion of social dimensions, the use of community consultations, and the development of multicriteria selection methods that encompass the concepts of sustainability and resilience. Multi-Criteria Decision (MCD) models, such as the one shown opposite, have become widely used as the main prioritization tool for road investment in recent years. They can reconcile multiple aspects associated with road investments while systemizing the exercise through relatively transparent data-driven methodologies. These models can be applied with different degrees of complexity. Some countries, such as China and Mozambique, have used very data-driven models. Others have used a combination of MCDs with community participation (Haiti, Nicaragua). Source: Qu et al (2019) 60 Appendix HEADQUARTERS THE WORLD BANK 1818 H Street, NW Washington, DC 20433 USA Tel : (202) 473-1000