FOR OFFICIAL USE ONLY
Report No: PADHI00257
INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT
PROJECT APPRAISAL DOCUMENT
ON A
PROPOSED LOAN
IN THE AMOUNT OF EUR 81.7 MILLION
(US$85 MILLION EQUIVALENT)
AND
A GRANT
FROM WESTERN BALKANS INVESTMENT FRAMEWORK – SAFE AND SUSTAINABLE TRANSPORT PROGRAM
IN THE AMOUNT OF EUR 6.5 MILLION
(US$6.76 MILLION EQUIVALENT)
TO THE
BOSNIA AND HERZEGOVINA
FOR A
SUSTAINABLE, INTEGRATED AND SAFE ROAD INFRASTRUCTURE PROJECT
(P502979)
FEBRUARY 12, 2025
Transport Global Practive
Europe and Central Asia Region
This document is being made publicly available prior to Board consideration. This does not imply a presumed
outcome. This document may be updated following Board consideration and the updated document will be made
publicly available in accordance with the Bank’s policy on Access to Information.
CURRENCY EQUIVALENTS
Exchange Rate Effective December 31, 2024
Currency Unit = CONVERTIBLE MARK
KM 1.88 = US$1
KM 1 = EUR 0.51
US$1 = EUR 0.9606
FISCAL YEAR
January 1 - December 31
Regional Vice President: Antonella Bassani
Regional Director: Charles Joseph Cormier
Country Director: Xiaoqing Yu
Practice Manager: Shomik Raj Mehndiratta
Task Team Leaders: Svetlana Vukanovic, Nadia Badea
ABBREVIATIONS AND ACRONYMS
AADT Average Annual Daily Traffic
BiH Bosnia and Herzegovina
CBA Cost-Benefit Analysis
CEF Connecting Europe Facility
CEFTA Central European Free Trade Agreement
DA Designated Account
EBRD European Bank for Reconstruction and Development
EIA Environmental Impact Assessment
EIB European Investment Bank
EIRR Economic Internal Rate of Return
EU European Union
FBIH Federation Bosnia and Herzegovina
GDP Gross Domestic Product
GHG Greenhouse Gas
HBS Household Budget Survey
HDM-4 Highway Development and Management Model Version 2.09
IFI International Financial Institutions
IRI International Roughness Index
KM Convertible Mark
M&E Monitoring and Evaluation
MOTC Ministry of Communications and Transport
NRSC National Road Safety Council
PC RS Roads Public Company Republike Srpske Roads
PC FBIH Roads Public Company Roads of FBIH
PIA Project Implementation Agreement
PIT Project Implementation Team
POM Project Operational Manual
PPSD Project Procurement Strategy for Development
RAMS Road Asset Management System
RPF Resettlement Policy Framework
RS Republika Srpska
SSTP Safe and Sustainable Transport Program
TCT Transport Community Treaty
TEN-T Trans-European Transport Network
TSARS Traffic Safety Agency of the Republic of Srpska
WBIF Western Balkans Investment Framework
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
TABLE OF CONTENTS
DATASHEET ............................................................................................................................. i
I. STRATEGIC CONTEXT ....................................................................................................... 1
A. Project Strategic Context .................................................................................................................1
B. Sectoral and Institutional Context ...................................................................................................1
II. PROJECT DESCRIPTION .................................................................................................... 5
A. Project Development Objective .......................................................................................................5
B. Results Chain and Key Indicators .....................................................................................................5
C. Project Beneficiaries ........................................................................................................................6
D. Project Components ........................................................................................................................6
E. Role of Partners ............................................................................................................................. 10
F. Lessons Learned and Reflected in the Project Design ................................................................... 11
III. PROJECT IMPLEMENTATION .......................................................................................... 12
A. Institutional and Implementation Arrangements ......................................................................... 12
B. Results Monitoring, Evaluation, and Verification Arrangements ................................................. 13
C. Disbursement Arrangements ........................................................................................................ 14
IV. PROJECT APPRAISAL SUMMARY .................................................................................... 14
A. Technical, Economic and Financial Analysis (if applicable)........................................................... 14
B. Fiduciary ........................................................................................................................................ 19
C. Environmental, Social and Legal Operational Policies .................................................................. 20
Grievance Redress Services:.............................................................................................................. 22
V. KEY RISKS....................................................................................................................... 22
ANNEX 1. RESULTS FRAMEWORK ......................................................................................... 24
ANNEX 2: Road M-18 Brod na Drini – Hum – Šćepan Polje, Route 2b .................................... 31
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
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DATASHEET
BASIC INFORMATION
Project
Operation Name
Beneficiary(ies)
Bosnia and
Sustainable, Integrated and Safe Road Infrastructure Project
Herzegovina
Environmental and Social Risk
Operation ID Financing Instrument
Classification
Investment Project
P502979 Substantial
Financing (IPF)
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Financing & Implementation Modalities
[ ] Multiphase Programmatic Approach (MPA) [✓] Contingent Emergency Response Component (CERC)
[ ] Series of Projects (SOP) [ ] Fragile State(s)
[ ] Performance-Based Conditions (PBCs) [ ] Small State(s)
[ ] Financial Intermediaries (FI) [ ] Fragile within a non-fragile Country
[ ] Project-Based Guarantee [ ] Conflict
[ ] Deferred Drawdown [ ] Responding to Natural or Man-made Disaster
[ ] Alternative Procurement Arrangements (APA) [✓] Hands-on Expanded Implementation Support (HEIS)
Expected Approval Date Expected Closing Date
10-Mar-2025 31-Oct-2030
Bank/IFC Collaboration
No
Proposed Development Objective(s)
Improve regional transport connectivity and enhance road network management for climate resilient and safe roads,
and in case of an Eligible Crisis or Emergency, respond promptly and effectively to it
Components
Component Name Cost (US$)
i
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
Improved Regional Connectivity 144,702,269.00
Enhanced Road Sector Management 3,903,810.00
Contingent Emergency Response 0.00
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Organizations
Borrower: Bosnia and Herzegovina
Contact Title Telephone No. Email
Nenad Vujicic Advisor to the Minister +38733 703 070 NVujicic@mft.gov.ba
Implementing Agency: Public Company RS Roads
Contact Title Telephone No. Email
Miroslav Jankovic technical director +38766112630 mjankovic@putevirs.com
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PROJECT FINANCING DATA (US$, Millions)
Maximizing Finance for Development
Is this an MFD-Enabling Project (MFD-EP)? No
Is this project Private Capital Enabling (PCE)? No
SUMMARY
Total Operation Cost 148.60
Total Financing 148.60
of which IBRD/IDA 85.00
Financing Gap 0.00
DETAILS
World Bank Group Financing
International Bank for Reconstruction and Development (IBRD) 85.00
Non-World Bank Group Financing
Other Sources 56.83
ii
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
European Bank for Reconstruction and Development 56.83
Trust Funds 6.76
Single Purpose Trust Fund 6.76
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Expected Disbursements (US$, Millions)
WB Fiscal
Year 2025 2026 2027 2028 2029 2030 2031
Annual 0.57 9.00 23.00 23.13 22.00 14.07 0.00
Cumulative 0.57 9.57 32.57 55.70 77.70 91.77 91.77
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PRACTICE AREA(S)
Practice Area (Lead) Contributing Practice Areas
Transport
CLIMATE
Climate Change and Disaster Screening
Yes, it has been screened and the results are discussed in the Operation Document
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SYSTEMATIC OPERATIONS RISK- RATING TOOL (SORT)
Risk Category Rating
1. Political and Governance Moderate
2. Macroeconomic Moderate
3. Sector Strategies and Policies Moderate
4. Technical Design of Project or Program Substantial
5. Institutional Capacity for Implementation and Sustainability Moderate
6. Fiduciary Moderate
7. Environment and Social Substantial
iii
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
8. Stakeholders Moderate
9. Overall Substantial
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POLICY COMPLIANCE
Policy
Does the project depart from the CPF in content or in other significant respects?
[ ] Yes [✓] No
Does the project require any waivers of Bank policies?
[ ] Yes [✓] No
ENVIRONMENTAL AND SOCIAL
Environmental and Social Standards Relevance Given its Context at the Time of Appraisal
E & S Standards Relevance
ESS 1: Assessment and Management of Environmental and Social Risks and
Relevant
Impacts
ESS 10: Stakeholder Engagement and Information Disclosure Relevant
ESS 2: Labor and Working Conditions Relevant
ESS 3: Resource Efficiency and Pollution Prevention and Management Relevant
ESS 4: Community Health and Safety Relevant
ESS 5: Land Acquisition, Restrictions on Land Use and Involuntary Resettlement Relevant
ESS 6: Biodiversity Conservation and Sustainable Management of Living Natural
Relevant
Resources
ESS 7: Indigenous Peoples/Sub-Saharan African Historically Underserved
Not Currently Relevant
Traditional Local Communities
ESS 8: Cultural Heritage Relevant
ESS 9: Financial Intermediaries Not Currently Relevant
NOTE: For further information regarding the World Bank’s due diligence assessment of the Project’s potential
environmental and social risks and impacts, please refer to the Project’s Appraisal Environmental and Social Review
Summary (ESRS).
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iv
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
LEGAL
Legal Covenants
Sections and Description
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Conditions
Type Citation Description Financing Source
The Subsidiary Agreement
has been executed on
behalf of the Borrower and
Effectiveness LA: Article IV, 4.01(a) the Project Implementing IBRD/IDA
Entity under terms and
conditions satisfactory to
the Bank.
The Project Agreement has
been executed by the
Effectiveness LA: Article IV, 4.01(b) IBRD/IDA
Project Implementing
Entity.
The Project Implementing
Entity, through PC RS
Effectiveness LA: Article IV, 4.01(c) Roads, has prepared and IBRD/IDA
adopted the POM
satisfactory to the Bank.
The Project Implementing
Entity, through PC RS
Roads, has established the
Effectiveness LA: Article IV, 4.01(d) PIT with staff, terms or IBRD/IDA
reference and
competencies satisfactory
to the Bank.
The execution and delivery
of Grant Agreement on
behalf of the Recipient and
the Grant Project
Agreements on behalf of
Effectiveness GA: Article IV, 4.01(a) Trust Funds
one Project Implementing
Entity have been duly
authorized or ratified by all
necessary governmental
action.
The Grant Subsidiary
Effectiveness GA: Article IV, 4.01(b) Trust Funds
Agreement for the Project
v
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
Implementing Entity has
been executed on behalf of
the Recipient and the
Project Implementing
Entity.
Grant Project Agreement
has been executed by the
Effectiveness GA: Article IV, 4.01(c) Trust Funds
Project Implementing
Entity.
The Loan Agreement has
been executed and
delivered and all conditions
precedent to the
effectiveness of said
Effectiveness GA: Article IV, 4.01(d) Trust Funds
agreement, or to the right
of the Recipient to make
withdrawals under said
agreement have been
fulfilled.
No withdrawal shall be
made under Category (1)
unless and until: (i) the Co-
financing Agreement has
been executed and
delivered and all conditions
precedent to its
effectiveness or to the right
of the Borrower to make
withdrawals under it have
LA: Schedule 2, Section
Disbursement been fulfilled; and (ii) the IBRD/IDA
III.B, 1(b)
Project Implementing
Entity has prepared and
implemented a
Resettlement Audit
satisfactory to the Bank,
and completed the
remedial actions identified
in the Resettlement Audit
in a manner satisfactory to
the Bank.
Under Categories (1) and
LA: Schedule 2, Section (2), unless and until the
Disbursement IBRD/IDA
III.B, 1(c) Project Implementing
Entity, through RS MoF, has
vi
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
entered into a Project
Implementation
Agreement with PC RS
Roads under terms and
conditions acceptable to
the Bank;
for Emergency
Expenditures under
Category (3), until and
unless: (i) (A) the Project
Implementing Entity has
determined that an Eligible
Crisis or Emergency has
occurred, and has
furnished to the Bank a
request to withdraw Loan
LA: Schedule 2, Section amounts under Category
Disbursement IBRD/IDA
III.B, 1(d) (3); and (B) the Bank has
agreed with such
determination, accepted
said request and notified
the Borrower thereof; and
(ii) the Project
Implementing Entity has
adopted the CERC Manual
and Emergency Action
Plan, in form and substance
acceptable to the Bank.
vii
The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
I. STRATEGIC CONTEXT
A. Project Strategic Context
1. Given BiH’s strategic geographic location, the transport network is critical for economic and regional
integration. The transport network integrates BiH along regional corridors, particularly with BiH’s main trading partners
(Croatia, Serbia and Montenegro) and EU countries, and also different regions within the BiH. The poor are
disproportionately concentrated in rural areas, where poverty rates are much higher than in urban areas (19 percent and
12 percent, respectively) and where jobs tend to be scarce and salaries low. Approximately 40 percent of poor rural
workers are employed in the agricultural sector, which faces low and declining productivity and competitiveness and
where connectivity to the markets is critical for the ability to trade their products. Transport is dominated by road
transport and the road network of about 25,000 km carries 90 percent of passenger transport and 80 percent of freight
transport. Despite a declining population, the motorization rate has increased by over 30 percent in the last decade with
a particular increase in road freight traffic which has grown by nearly 6 percent per annum.
2. BIH’s vision for the transport sector is built around its ambitions for European Union (EU) accession and meeting
the standards to achieve this. The proposed project is consistent with BiH and regional policy objectives. This includes
connecting communities in a safe, sustainable, resilient, smart, reliable, and affordable manner. EU progress report for
2023 on meeting Transport Acquis reported on moderate progress with measures outlined in the Road Action Plan and
road safety and improved road network resilience are among the key objectives along with regional integration. The
Project will support efforts to improve regional connectivity and safety and resilience of the road network.
3. The project is in line with the BiH’s strategies on climate change including the updated 2021 Nationally
Determined Contribution 1, the National Adaptation Plan (2022) 2, the 2020-2030 Climate change Adaptation and low
emission development strategy (2020) 3. The NDC foresees a reduction target of 33 percent relative to 1990 levels by
2030 (with actions in power sector, district heating, building, transport, industry, agriculture, forestry, waste and the cross-
cutting sectors). The National Adaptation Plan includes production of methodological guides to assess impacts of extreme
weather events on transport systems and revision of transport infrastructure standards in the list of potential key sector
indicators based on international experience and practices. Regarding adaptation, the BiH is ranked 79th in terms of
combined climate vulnerability (#34th) and readiness (#113th) according to the Global Adaptation Initiative’s (GAIN) index 4.
Given that the region is increasingly vulnerable to natural hazards like floods, heavy precipitation, flash floods, droughts
and landslides 5, the project will support network vulnerability assessment of the part of the BiH main and regional road
network and development of the corresponding action plan, as well as slope stability monitoring with the aim of increasing
road safety through reduced vulnerability to climate induced risks.
B. Sectoral and Institutional Context
4. Improving connectivity within the Western Balkans, as well as between the Western Balkans and the EU, has
been a key pillar in the drive for growth and jobs in the region. The main transport links are now part of the Indicative
extension of the Core and Comprehensive Trans-European Transport Network (TEN-T) to the Western Balkans, and
1
https://unfccc.int/sites/default/files/NDC/2022-06/NDC%20BiH_November%202020%20FINAL%20DRAFT%2005%20Nov%20ENG%20LR.pdf
2
https://unfccc.int/sites/default/files/resource/NAP-Bosnia-and-Herzegovina%20.pdf
3
https://unfccc.int/sites/default/files/resource/ENG_CC%20adaptation%20and%20Low%20emission%20development%20Strategy%20BiH%202020-2030.pdf
4
https://gain.nd.edu/our-work/country-index/rankings/
5
https://climateknowledgeportal.worldbank.org/sites/default/files/2021-07/15914-WB_Bosnia%20Country%20Profile-WEB%20%281%29.pdf
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The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
improvement of those links constitutes one of the main priorities for transport investment. There is also a substantial
program of investment and backlog maintenance required on the main and regional roads where maintenance has been
underfunded. Climate change is also increasing the vulnerability of the road network, and extreme weather events are
increasing the frequency and magnitude of landslides in particular.
5. The project will finance a section of the TEN-T comprehensive network connecting Sarajevo with Podgorica in
Montenegro. The Section, between Foca and Scepan Polje in Republica Srpska, is in poor condition and has been closed
to commercial vehicles since 2019. The section is important as a key link between BiH and Montenegro supporting trade
and tourism between the two countries. The project will also finance a program of rehabilitation on the main and regional
roads to address backlog maintenance and support the road agency to achieve greater operational and financial
sustainability in the management of their network. A key focus for the project will be on investments, and institutional
support, that addresses network vulnerability associated with climate change and measures to improve road safety.
6. The institutional structure of the BiH transport sector is complex, with state level and much decentralized entity
level institutions. The Constitution of BiH reserves certain decisions to entities in several areas, including transport and
infrastructure. The sector is administered at the state level by the Ministry of Communications and Transport (MOCT), and
at the entity level, by separate Ministries of Transport and Communications (MOTC). Public companies are established in
each entity and entrusted with the management of the road and railway assets and operations. Thus, the Framework
Transport Strategy (2015-2030) for BiH has been developed considering entities and Brcko District constitutional
competences. Many of the investment and policy priorities in the strategy are based on the World Bank Regional Balkans
Infrastructure Study (REBIS) and are now reflected as priorities under the EU funded Transport Community Permanent
Secretariat (TCT) founded by the EU Treaty (2017).
7. The management of motorways and state road networks is entrusted to entity companies in the Federation of
Bosnia and Herzegovina (FBIH) and Republica Srpska (RS). Management of the roads network in RS is undertaken by
Public Company Republic of Srpska Motorways for motorways (PC RS Motorways), and Public Company Putevi Republike
Srpske (PC RS Roads) for the main and regional roads. In FBIH Public Company Motorways of FBIH (PC FBIH Motorways)
manages motorways and expressways and the Public Company Roads of FBIH (PC FBIH Roads) manages main roads, while
cantonal Road Directorates (or competent cantonal Ministries), are responsible for regional roads. Local roads are
managed by municipalities and cities. PC RS Roads, the focus of this project, manages about 4,200 km of road, out of which
around 42 percent are main roads and 58 percent regional roads. Road maintenance is managed based on 12 zones which
are periodically contracted out to the private sector. In practice, there is limited competition, and the 9 incumbent
companies have been in place for many years.
8. Following growing concern over the long-term sustainability of road sector funding, the excise duty on motor
fuels was increased in 2018. This has directed considerable additional funds to the road sector, representing a major relief
to the Roads sector. A fuel levy of 0.25 KM/liter has been implemented which provides for 0.20 KM going to motorways
and 0.05 KM for other roads. 59 percent of the total goes to FBiH, 39 percent to RS. And 2 percent to Brcko District.
Revenues from excise duties accounted for approximately 63 percent and 48 percent of total revenues in FBIH and RS
respectively. Other revenues come from registration taxes and tolling revenues on the motorway system. The road
companies also benefit from commercial and IFIs lending as well as some grant finance from their respective entity
budgets. Servicing the debt associated with these loans in the RS has become an increasing concern with an important
portion of variable-rate debt, as well as large debt maturities coming due in the near term. Effectively managing the debt
burden is key to ensuring sufficient finance for the long-term maintenance and development of the road network.
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
9. The challenge for PC RS Roads over the next few years will be to achieve long-term financial sustainability while
increasing the efficiency of expenditures and the governance in the sector. The total annual budget for the company
doubled in the period between 2017-2019 and is expected to increase by a further 50 percent to 2030 which is positive
for the long-term sustainability of the network. Spending per km is around EUR 9,000 which is close to international
comparators. However, due to past underinvestment in the sector and large backlog maintenance, much of the spending
is used to “patch” roads that actually need rehabilitation. Of particular concern are the stock of bridges and tunnels that
were built in the post-World War II years. It is estimated that 51 percent of the main roads in RS are in fair and 28 percent
in poor and very poor conditions, being in an immediate need of rehabilitation or reconstruction as well as a substantial
stock of bridges and tunnels. Interventions are also required on road safety, slope stability, and improvements to road
geometry and junction design. Historical underinvestment, inadequate recurrent funding, and challenging debt
management have limited their ability to address the substantial program of backlog rehabilitation. PC RS Roads need to
strike the appropriate balance between new construction activities and activities to maintain and restore the network
while maximizing the efficiency of expenditures in the sector.
10. Improving asset management practices and systematic inclusion of resilience and safety considerations, will be
essential to balance the maintenance and rehabilitation programs and bring the overall network to a steady state of
maintenance and financial sustainability. PC RS Roads have invested in the development of an asset management system
to support this task, but the system has been developed to the level of an inventory and it lacks a module to undertake
prioritization based on economic criteria and, as such, has never been fully institutionalized. Getting this system working,
along with the preparation of regular annual and multi-annual plans, is a key element for the governance of the sector
and will form part of the technical assistance program for this project. An assessment for the preparation of this project
estimated that under optimal scenario, the RS would need an additional EUR 460 million on the top of their current
expenditures until 2030 to address backlog requirements. Part of this funding will come from this project, but not the
entire program can be funded. The priorities for the future long-term funding will be established through enhanced asset
management system that also integrates information from resilience and safety screenings.
11. BiH, including its road network, is sensitive to extreme climate change exacerbated hazards and improved
climate-resilient asset management is needed to incrementally reduce network vulnerability beyond climate-proofing
to ensure that the adaptive capacity of the road network is built. BiH is exposed to increasing intensity and frequency of
both onset hazards (such as temperature and rainfall changes) and sudden hazards (such as more extreme weather
events), placing a high risk of urban and river flooding, flash floods, landslides, and wildfires. 6 The road network was
significantly affected by the floods in 2014, and there have been recurring problems ever since. The Bank supported
emergency repairs following the floods through the BiH Floods Emergency Recovery Project (P151157). Route 2b, the
focus of this project, is particularly susceptible to landslides, flash floods, and snowfalls and six separate fault areas have
been identified that will need remedial attention. As per the latest TCT report 7, route 2b is forecast to be amongst the top
20 most vulnerable road sections in 2030 and 2050. The large number of bridges and tunnels on the rest of the network
in RS are also vulnerable to flooding and landslides and need rehabilitation to enhanced standards. For timely
identification and prevention of these potential hazards, continuous monitoring is required together with a register of
vulnerable sites and guidelines for vulnerability screening and climate resilient designs.
12. At the operational level, there is a significant evasion of the axel load limits on main roads contributing to
reduced road network life and higher maintenance and rehabilitation costs. Current enforcement policies are ineffective
6
Global Facility for Disaster Reduction and Recovery Think Hazard platform: https://thinkhazard.org
7
Transport Community Treaty Permanent Secretariat, Improving climate resilience and adaptation measures in the indicative extension of TEN-T
road and rail networks in Western Balkans, 2023: https://www.transport-community.org/wp-content/uploads/2024/02/Final-
Report_Climate_Resilience.pdf
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
and enable overweight trucks to operate with impunity. The introduction of a weight control system to address overloaded
trucks is thus a priority to protect road infrastructure from excessive wear and tear. A key part of the institutional
component of the project will be to support enhanced asset management practice including the implementation of weight
control systems and associated update of regulations to strengthen enforcement.
13. Despite a decreasing trend in road fatalities, Bosnia and Herzegovina still faces high road fatality rates compared
to EU countries. The 2022 data for Fatality rates in BiH are 63 deaths per million which is comparable with other countries
in the region but nearly 40 percent higher than the average for EU-27 and close to three times the level of the best
performing countries such as Sweden. Over-speeding and low seat belt usage are the leading causes. There is a need for
a renewed institutional focus, including the National Road Safety Council (NRSC) which has been established but is not
fully functional. The BIH and FBIH do not have a strategy and the one in RS has expired. It is necessary to establish a system
for road crash data collection based on the CADaS protocol, in the entire territory of BiH. With support from the previous
WB financed project10, the Traffic Safety Agency of the Republic of Srpska (TSARS) as the leading agency for road safety
has been established in 2011. TSARS has developed a Road Safety Action Plan, but it needs updating and sustainable
funding. Proactive road safety assessments (RSA) and inspections (RSI) are not mandatory in the BiH, although systematic
use of these tools could significantly improve the sustainability of road investments and bring large safety benefits with a
relatively minor increase in construction costs. RSA and RSI have been integral part of previous Bank engagements. Within
this Project, RSA will be mandatory for all works to be financed, while RSI (iRAP) will be extended to cover the major
portion of the main network.
14. As per EU progress report 8 for 2023 on meeting Transport Acquis, BiH made moderate progress in implementing
the measures outlined in the Road Action Plan achieving an overall implementation rate of 47 percent. The main areas
identified for further progress include upgrade of Road Asset Management System (RAMS) and maintenance planning,
improved network resilience, improvement of road safety, and greater adoption of ITS. In addition, targeted road safety
interventions and resilience considerations have been supported within IFI funding projects, but systematic inclusion in
road design, construction, maintenance and supervision is lacking. Addressing these issues will be a main component of
this operation, both in terms of capital investments and technical assistance.
15. Despite some progress achieved over the past decade toward gender equality in BiH, notably in the areas of
health, education, and political representation, significant gender gaps persist in the labor market, in transport sector
in particular. There is a more than 25-percentage point gender gap in employment, with only 40 percent of women
between 20 and 64 years old and 68 percent of men in the same age category employed in 2022. Also, there is a clear
divide between where women and men work and the type of jobs they do. Women are concentrated in health, education,
and social services, while men dominate other sectors, such as energy, transport, construction, and information and
communication technologies. For example, in 2022, only about 5 and 10 percent of those employed in construction, and
in transportation and storage were women 9. This is against 41.4 percent of women and 58.6 percent of men graduating
from engineering, manufacturing, and construction fields (master’s degree and doctorate) indicating existence of a
sizeable female talent for the transport sector employers to tap into 10. Besides the lack of women in male-dominated
sectors in absolute terms, there is a division throughout the sectors between the types of occupations carried out by
women and men. The project will explore opportunities to address gender disparities in the BiH’s labor market. This
8
COMMISSION STAFF WORKING DOCUMENT Bosnia and Herzegovina 2023 Report Accompanying the document Communication from the
Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions 2023
Communication on EU Enlargement policy.
9
Women and Men in Bosnia and Herzegovina, 2024. Labor Force Survey 2022.
https://bhas.gov.ba/data/Publikacije/Bilteni/2024/FAM_00_2023_TB_1_EN.pdf
10 Ibid.
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includes an intervention focusing on providing paid internships to 30 university students, with a targeted focus on
women's participation in the transport sector. The project will ensure that at least 60 percent of the interns (18 out of 30)
are women, actively promoting their inclusion in the job market, aiming at creating permanent employment for five of
them.
II. PROJECT DESCRIPTION
A. Project Development Objective
16. The Project Development Objectives are to improve regional transport connectivity and enhance road
network management for climate resilient and safe roads, and in case of an eligible crisis or emergency, respond
promptly and effectively to it.
B. Results Chain and Key Indicators
17. The achievement of the PDO will be measured with the following key results indicators:
(a) Connectivity: Reduced travel time between Brod na Drini (Foca) – Hum (Scepan Polje), M-18 (Route 2b of the TEN-T
network) (Minutes);
(b) Safer and more resilient regional road network: All project designs have incorporated climate resilience best
practice and agreed recommendations from road safety inspections and audits (Percentage);
(c) Road users, communities, and business benefiting from improved roads: People benefiting from improved access to
sustainable transport infrastructure and services – Corporate Result Indicator (Number of people);
(d) Enhanced management of the road sector: Annual and multiannual business plans are developed based on the
outputs from RAMS that integrate information on resilience and road safety and reported against (yes/no).
18. The results chain for the project is as follows:
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
Figure 1. Theory of Change
C. Project Beneficiaries
19. Beneficiaries are primarily road users, who are expected to benefit from improved road conditions, reduced
road closure due to extreme weather and enhanced safety considerations. Rehabilitation and improvement of an
estimated 100 km of main roads will provide more resilient and safer transport across BiH. Main roads subject to
rehabilitation are mainly used for commuting traffic. Benefits are expected in rural areas, who will get much needed
improved access to markets, services, and jobs. The new construction on Route 2b will contribute to the improvement of
connectivity of two capitals, Sarajevo and Podgorica, and as such, positive economic impacts on the municipalities along
the route and their rural hinterlands are expected. The new road will also benefit the broader population in BiH by
providing much-improved connectivity to neighboring Montenegro. Beneficiary communities include a mix of rural
communities with higher poverty levels and greater reliance on agriculture, urban municipalities, and areas with
socioeconomically diverse populations. The improved quality of infrastructure and reduction in transport costs would
allow for the re-establishment of freight transport along Route 2b and, as such, enhance BiH companies' ability to export.
The project also has a high potential to boost tourism, given some of the most popular rafting sites in Europe are located
along the alignment and this is shortest path to Montenegro seaside, attracting tourists from BiH and other European
countries.
D. Project Components
20. The project components are aimed to improve regional transport connectivity and enhance road network
management for climate resilient and safe roads by financing (i) upgrade of a key regional corridor route 2b, between
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
Sarajevo and Podgorica, (ii) improvements of selected sections of the main road network in RS, and (iii) selected actions
to enhance road sector management. The project will address part of the backlog rehabilitation program together with
targeted sections prone to climate change exacerbated and/or road safety risks to bring the overall network to a
maintainable condition, increase traffic safety and reduce network vulnerability at the systemic level beyond climate-
proofing the road as climate change impacts are affecting the entire region and investing in these roads will protect the
overall resilience of the wider network. Institutional support will be provided to enhance the capacity of PC RS Roads to
manage the road network.
21. The project will support part of a larger program of investments of road rehabilitation and upgrade that have
been identified in Bosnia and Herzegovina. The overall financing plan 11 for this project, in the RS, is EUR 142.8 million
consisting of: (i) EUR 81.7 million equivalent IBRD financing including the front-end fee of EUR 0.2 million; (ii) EUR 54.6
million EBRD financing; and (iii) EUR 6.5 million SSTP financing. EBRD financing will be solely for construction of Route 2b
under joint procurement arrangements with the World Bank as defined by the Mutual Reliance Agreement. Route 2b will
be financed based on a contribution ratio of 40 percent IBRD and 60 percent EBRD. The SSTP grant will only finance road
safety activities as set out in sub-component 1.3. The description of the project components is as follows:
Component 1: Improved Regional Connectivity (EUR 138.85 million of which EUR 77.75 million IBRD; EUR 54.6 million
EBRD; and EUR 6.5 million SSTP)
22. The overall objective of this component is to improve regional connectivity and the safety and climate resilience
of the main road network in RS. The component will finance upgrade and improvement of Route 2b of the TEN-T network
connecting Sarajevo (BiH) and Podgorica (Montenegro), and for the reconstruction, rehabilitation and maintenance of
priority main roads in the RS to climate-resilient standards 12. The upgrade of Route 2b will further regional integration
with Montenegro, improve access to markets, foster the growing tourism industry in the area, and support BiH in its EU
accession process. Financing of priority main roads will further domestic connectivity and the resilience and safety of the
network. Given the high exposure to climate vulnerability in the project area, all infrastructure investments will be
designed to withstand extreme rainfall and flood events of 1 percent probability of occurrence.
Subcomponent 1.1: Upgrade of Route 2b between Brod na Drini (Foca) and Hum (Scepan Polje) (EUR 94.0 million of
which EUR 39.4 million IBRD, EUR 54.6 million EBRD)
23. This subcomponent will improve the connectivity, safety and climate resilience of the overall BIH network by
improving the only link directly connecting Sarajevo and Podgorica through the upgrade of approximately 12.6 km
between Brod na Drini (Foca) and Hum (Scepan Polje) on route 2b to climate-resilient standards, which will ultimately
unlock resilience at the systemic level provided the role of this road link within the road network. The works will be
tendered through a design and build approach, following the alignment recommended in the feasibility study for which
detailed design was developed through EU IPA funds in 2017. The alignment follows the right bank of Drina River until the
confluence of the rivers Tara and Piva, where the border crossing and major bridge is located. The project will finance all
necessary culverts and small bridges, interchanges and works on local connecting roads to capture climate projections to
11
A WBIF grant of EUR 36.2 million was pre-approved to cover investments on route 2b in July 2024 but there is some uncertainty when it will be
formally approved, and funds made available. The project will be negotiated with IBRD and EBRD loan amounts covering 100 percent of investments
on route 2b. Should the WBIF grant be approved as expected, the EBRD will reduce their loan amount to EUR 29.4 million, IBRD will divert loan
proceeds to the rehabilitation program under sub-component 1.2.
12
Climate-resilient standards address current and projected extreme heat, flood episodes, changing rainfall and snow patterns, and climate change-
induced landslides, including the use of NBS, soft measures, and innovative technology for (i) systems planning; (ii) engineering and design; (iii)
operations and maintenance; (iv) contingency programming; and (v) institutional capacity and cooperation.
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
provide adaptive capacity to the full road network through the investment on this road link, while the intercountry bridge
will be financed by BiH. Given that this route is particularly susceptible to flash floods and landslides, with more than 20
potential landslide locations, special attention will be put into slope stabilization and drainage structures beyond climate
proofing to protect the areas surrounding this primary road link and to ensure functionality of this route during climate
events and other emergencies. The project will finance consultancy services to undertake design reviews, conduct road
safety audits and for site supervision. Bidding documents for procurement of designs, works and supervision will include
detailed description of climate vulnerability status of project location(s) and list requirements needed to address these
vulnerabilities aiming at improved climate resilience of road infrastructure.
24. The road rehabilitation resilience standards include: (a) design modifications to asphalt/foundations to
accommodate increasing local high temperature conditions and use of a layer of high-grade asphalt or concrete; (b) bridge
joints designed with sufficient expansion room; (c) road reserve stabilization with concrete blocks; and (d) raising the road
by 1 m on fluvial flood prone sections to reduce flood damages. The project also invests in enhanced drainage, which
include: (a) resizing drainage infrastructure (e.g.: culverts) and bridges to accommodate more rainwater discharge; and
(b) using geocells or hydroseeding of slopes around culverts and bridge. In addition, the project will also use a "Green
Roads for Water" 13 approach, focused on flood risk mitigation and water management solutions, by waterproofing
roadways, improving drainage and groundwater recharge that protect the communities adjacent to the proposed roads
and plantation of trees and vegetation for CO2 absorption.
25. The current road is in poor condition due to its accelerated deterioration, due to adverse weather conditions
like flash floods, rain and snow. While the road is under maintained and design standards are inadequate, poor
maintenance, old age and current traffic volume are not driving deterioration; instead, climate events are. The road is
two-way with only 3.5m of total width, and it is characterized by many active landslides and ongoing deformations of the
road surface, wooden bridges, and dangerous alignment. The road has been closed for trucks and commercial vehicles
since 2019. While the design has been prepared back in 2017, there is a need to perform additional geotechnical
investigations and update and adjust detailed designs, if and where needed. The road is vulnerable to flooding and
landslides and will require additional design work to enhance climate resilience. A road safety audit will be undertaken to
inform the final detailed design. The design and build approach will transfer part of the risk to the contractor, which might
result in slightly higher costs but would allow for more flexibility and faster implementation once the designs are approved.
An expert will be mobilized to support the client in preparing the design and build tender documents as per the Bank
guidelines. The entire investment will be in RS and jointly financed with an EBRD loan.
Subcomponent 1.2: nvestments for the reconstruction, rehabilitation and maintenance of selected priority main roads
(IBRD EUR 38.35 million)
26. This sub-component will finance selected sections of the PC RS Roads program for the reconstruction,
rehabilitation and maintenance of priority main roads prioritized based on its climate vulnerability and safety
considerations while ensuring balanced regional representation and the highest level of resilience to the prevailing
natural hazards and road safety design standards. The roads will be prioritized based on ensuring balanced regional
representation and the highest level of resilience to the prevailing natural hazards and road safety design standards. In
total about 100 km of road will be improved along with associated blackspot improvements and interventions to enhance
climate resilience. The works will be undertaken along the existing alignment and will include resurfacing, partial
pavement widening, traffic signalization improvements, road safety improvements, access roads and investments to
13
Van Steenbergen,Frank W. M.; Arroyo Arroyo,Fatima; Rao,Kulwinder Singh; Hulluka,Taye Alemayehu; Woldemariam,Kifle Woldearegay; Deligianni, Anastasia. Green
Roads for Water: Guidelines for Road Infrastructure in Support of Water Management and Climate Resilience (English). International Development in Focus Washington,
D.C.: World Bank Group.
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enhance climate resilience similar to those proposed for subcomponent 1.1, including slope stabilization, drainage,
rehabilitation of bridges and tunnels as well ancillary connections. The project will also finance necessary design works
and site supervision. All designs will be subject to a road safety audit. The investments will be prioritized based on the
climate-risk informed PC RS Roads investment program and accompanying cost benefit analysis. Where appropriate, the
project will also finance facilities for Non-Motorized Transport (NMT) (cycling and walking), including pedestrian crossings,
pathways and sidewalks with solar-powered street lighting and plantation of trees and vegetation for CO2 absorption.
27. Sub-component 1.3: Road safety improvements. (EUR 6.5 million SSTP grant finance). In Republika Srpska, the
SSTP grant financing will support the following investments:
(a) Small scale civil works and road safety equipment to improve road safety for 10 school zones along the high-risk main
roads in RS.
(b) Road safety improvements on a 18 km section of M16 in RS (from Srpske Toplice to Karanovac, km2+000 – km6+692,
and from Karanovac to Krupa na Vrbasu km0+000 to km13+308), which is part of the Comprehensive TEN-T Road
Network. Interventions will include a new pavement wearing layer to reduce slipping.
Component 2: Enhanced Road Sector Management (IBRD EUR 3.75 million).
28. This component will support enhanced capacity of PC RS Roads company to manage and operate their road
infrastructure efficiently and cost effectively. The design of this component reflects screening and recommendations
from the EU acquis report for BiH and further institutionalization of the reforms supported through previous bank
engagements. The selected activities will strengthen road management in BiH with a particular focus on improving the
financial sustainability of PC RS Roads, mainstreaming climate resilience, and enhancing road safety. Capacity building
activities will have a special focus on strengthening internal PC RS Roads capacity in addressing climate change resilience
and employing adaptation measures as part of regular maintenance and rehabilitation activities.
Subcomponent 2.1: Improve safety and resilience of the main and regional road network (IBRD EUR 2.35 million)
29. This subcomponent will finance technical assistance, goods and services, and training to enhance the
institutional capacity to deliver effective road safety and climate resilient programs. The following activities will be
supported:
(a) Implementing Road Safety Inspections (RSI) on the priority road network. Recommendations from the RSI will be
included in a road safety action plan for the development of a program for blackspot improvement.
(b) Undertake a comprehensive analysis of the safety of children around schools and on their way to and from home. The
results of the analysis will be used to develop and deliver targeted trainings and campaigns to teach children road
safety.
(c) Implement a network vulnerability assessment on the main road network to screen for climate-induced hazard
vulnerability. The findings will be used to develop an action plan to incrementally reduce network vulnerability to
climate change.
(d) A slope management system will be implemented to monitor climate-induced slope instability. This activity will finance
land slide monitoring equipment, warning and informative traffic signs and minor civil works and nature-based
solutions to reduce network vulnerability to landslides.
Subcomponent 2.2: Enhance Borrower’s operational management and financial sustainability of the roads sector
(IBRD EUR 0.6 million)
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30. The subcomponent will finance technical assistance, goods and services aimed at enhancing the operational
management of the roads sector. It will finance activities that support the institutionalization of modern road asset
management systems that enhance operational and financial sustainability. The activities include:
(a) Diagnostics and implementation of enhanced Road Asset Management Systems for RS PC Roads: The project will
finance a diagnostic, and subsequent implementation, of mechanisms to better institutionalize the use of the existing
RAMs for maintenance planning and investment prioritization. The focus will be on the preparation of investment and
maintenance plans, and optimizing multiannual planning, while including information on network resilience and road
safety in the system.
(b) Implementation of enhanced Weight control systems. This activity will finance mobile weight control systems,
maintenance of existing systems where required and technical assistance to improve the existing legislation around
enforcement of weight limits. These activities will allow the RS to extend and improve their existing systems of weight
control in the short term, and plan for bringing in legislation that allows for modern methods of weight control in the
longer term.
(c) Technical assistance to develop a strategy for debt restructuring to improve long term financial sustainability.
Subcomponent 2.3: Project Management and Capacity building (IBRD EUR 0.8 million)
31. This subcomponent will finance eligible expenses for project implementation support. This will include training,
knowledge exchange, short term consultancy support, and operating costs. These activities will support the road company
staff with capacity building and expert support as may be necessary in procurement, financial management,
environmental and social management and annual program planning. The subcomponent will provide support in the
establishment of the online platform for dissemination of information about the project and user feedback interface. This
will be implemented either through a separate project webpage or within the existing web page of PC RS Roads.
32. The subcomponent will finance 30 3-month paid internships, out of which sixty percent will be women, with
the aim to guarantee permanent employment for at least 5 women in PC RS Roads. Currently, roughly 45 percent of the
total employees working at the PC RS roads are women reflecting a significant share, however only 25 percent of women
are employed in the managerial roles and 34 percent in technical positions. Paid internships will be granted to students
from the final year of relevant faculties or recently graduated students and prioritizing female students in the
transportation and construction fields that are traditionally male dominated (e.g. engineering). The PC RS Roads will lead
the overall implementation of the internship program to ensure it is tailored to the specific needs of the sector and will
set up collaboration with education institutions that prepare graduates with relevant profiles.
33. The proposed internship training will signal that the PC RS Roads is an equal opportunity employer keen to
invest in women's professional development and to support gender diversity in its workforce. The five interns who will
be absorbed in the organization will be employed in technical roles and ensure that they are not placed in administrative
roles, where women are often more concentrated.
Component 3: Contingent Emergency Response (IBRD EUR 0 million).
34. This component will support provision of immediate response to an Eligible Crisis or Emergency, as needed.
E. Role of Partners
35. Development partners. The EU, European Investment Bank (EIB), and European Bank for Reconstruction and
Development (EBRD) are most active in financing transport infrastructure in BiH, mainly focused on completing missing
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TEN-T Core network links. However, there is a history of joint work between the World Bank, EIB and EBRD in the sector,
most recently under Federation Road Sector Modernization Project. EBRD and the World Bank will jointly finance Route
2b construction, backbone of this project, through one procurement procedure enabled by the recently signed Mutual
Reliance Agreement, with IBRD being a lead IFI. Route 2b is considered a flagship project by the WBIF and a grant amount
of EUR 36 million has been pre-approved for approval in December 2024, upon adoption of the Growth Plan. The client is
also requesting EUR 6.5 million grant finance under the SSTP Facility to support road safety improvements.
Table 1. Roles of partners
Name of Partner Nature of Involvement /Description
EBRD Will provide a loan to co-finance the Foca – Scepan Polje Road.
EC Will provide grant finance through the World Bank managed SSTP to support road safety interventions.
F. Lessons Learned and Reflected in the Project Design
36. The Project will build on recent and ongoing World Bank analytical work, technical assistance, and
infrastructure projects in BiH and the region. The World Bank has supported BiH in improving the transport infrastructure
network since 1996. Recent contributions to improving infrastructure networks in BiH include the Road Infrastructure and
Safety Project (RIISP), Federation Road Sector Modernization Project (FRSMP), and Republika Srpska Railway Restructuring
Project (RSRRP). The latter two are a part of the Series of Projects. Both activities will inform the project's road construction
and rehabilitation works essentially aiming for long-term impact beyond the project.
37. Road companies in BiH have already established RAMS, but they have yet to be fully institutionalized to be used
for preparation of annual and mid-term investment and maintenance plans. Lessons from previous projects in BiH and
the region highlight the problems of implementing robust systems for the prioritization and implementation of road
maintenance activities and non-inclusion of resilience and safety consideration in prioritization. Decisions are often made
to address short term considerations without sufficient consideration of the longer-term plan to bring the overall network
into maintainable condition. Projects have supported RAMS in the past, but experience has shown that fully
institutionalizing this system has been challenging both because of insufficient data and because the systems are not
aligned with the road agencies procedures for delivery of maintenance. This project includes support to focus on the
institutionalization of PC RS Roads existing road asset inventory, making sure that the data is complete and current and
including a module that will allow for the economic prioritization of road interventions. RAMS will include information on
road conditions, climate vulnerability and resilience, and safety. Ensuring that all the road condition data is collected
annually and uploaded into the system and accounting for climate change considerations' influence on infrastructure
planning is paramount to mitigate the need for extensive repairs in the aftermath of extreme weather events.
Prioritization will be done based on RAMS and will directly inform business plan development and annual reporting.
Simultaneously, the main network in RS will undergo vulnerability and road safety screening, showcasing commitment to
comprehensive and cutting-edge solutions.
38. Building a safe and resilient road network brings benefits beyond doing business as usual. Much of the road
network in BiH is in challenging terrain and vulnerable to extreme weather conditions resulting in flash floods, floodings,
and landslides. Experience from the region and globally highlights the challenge of addressing network vulnerability
because of the extent of the problem and the complexity and cost of mitigating that vulnerability. Lessons from elsewhere
highlight the importance of developing a methodical but incremental approach to addressing the issue and the importance
of having a multi-agency response. Using an asset management system is essential to support prioritization and to assess
the costs of failure and availability of alternative routes in the event of road closures. Integrating climate resilience in the
investment planning process enables road agencies to provide timely intervention through their maintenance and
reconstruction program. For the best results it is also critical to address resilience and safety during design and
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implementation. The Project mitigates this risk by placing the responsibility of quality designs on the Project
Implementation Team (PIT). The PIT will ensure that designs for each road section to be rehabilitated under the Program
will include recommendations from the RSA and Resilience assessment. Bank-wide experience shows that it is not
inconceivable for road rehabilitation to harm road safety due to the increased operating speeds on the improved roads.
Integrating safety considerations into road design elements will proactively improve the network's road safety
performance, ToRs for design will be based on screening and diagnosis of the current situation on the ground. This project
will support this process in a number of ways including with screening, designs, linkage to asset management and
developing multi-agency responses should an emergency occur.
39. The project design is not only informed by the lessons learned in previous World Bank engagements but also
represents a significant leap forward, introducing innovative approaches to elevate the transport sector in BiH to a new
level. In addition to the physical asset condition, the project will support RAMS enhancement by including network
vulnerability assessment and a systematic economic evaluation of road works. Equally critical is preserving the asset's life
by preventing it from overloading. In recent years, the growing trend of total volume and quantity of goods transported
by road resulted in more frequent pavement damages, with consequent faster deterioration of roads' constructive
elements and reduced level of services on main road networks in BiH, primarily due to excessive total weight and axle
overload. To achieve best results the use of Weigh-In-Motion (WIM) systems, a mixture of mobile weight control systems
and fixed weigh-in-motion (WIM) systems is proposed in this project. A Technical Assistance will support determining the
WIMS placement strategy and propose improvements of the governing framework to increase effectiveness of WIMS
system operations and enforcement.
40. The project is designed to support institutional strengthening. Experience from previous projects has
demonstrated that PC RS Roads have good staff capacity to manage the design and implementation phases of this project.
However, experience suggests that implementing a yellow FIDIC design and build contract is more challenging than a
conventional civil works contract. PC RS Roads will have to pay particular attention to the quality of outputs during the
design phase, strict enforcement of contract management conditions and attention to the realism of implementation
timetables. Also, when the project is implemented by external consultants, the knowledge and capacity-building benefits
can diminish with the closure. Therefore, the project will be implemented with the exiting PC RS Roads employees, but
the project also includes funding for additional consultancy support and capacity building as required, particularly in
environmental and social framework, procurement strategies, and modern road design techniques.
III. PROJECT IMPLEMENTATION
A. Institutional and Implementation Arrangements
41. The project will be implemented by PC RS Roads. PC RS Roads will establish a core Project Implementation Team
(PIT) before effectiveness by appointing a responsible PIT head and experts with experience in road construction and
rehabilitation, safety, asset management, procurement, social and environmental management, and financial
management. The PIT will be responsible for coordination, planning, procurement, disbursement, auditing, Project-level
monitoring and evaluation, progress implementation reporting, and use of Project funds. This will be detailed in the
Project Operational Manual (POM), prepared by PC RS Roads before effectiveness.
42. PC RS Roads will assign their existing staff to work in at the PIT and bring in consultancy support where required.
The PIT should have at least one expert in the following areas: road safety, road construction/rehabilitation (at least two),
geotechnical, procurement, contract management, financial management, environmental, social and citizens
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engagement. Social expertise will be responsible for implementation of Resettlement Policy Framework (RPF)/
Resettlement Action Plans (RAPs), as well as for overseeing the operations of CE mechanisms, ensuring grievances are
appropriately and timely logged. An external senior procurement consultant will also be hired to support the PIT in the
first year to provide hands-on training on Bank Procurement Regulations and Procedures and ensuring a smooth transition
to the PIT. The capacity of the PIT will be strengthened as necessary through short-term consultancies and targeted
training and workshops.
43. The Sub-component 1.1 (Donja Kopilova – Scepan Polje Road) will be implemented through a Mutual Reliance
Agreement between EBRD and IBRD, with IBRD being the lead institutions. All procurement will be undertaken using the
World Bank Procurement Guidelines, as per Project Implementation Agreement (PIA) signed between two institutions.
Social and environmental management will be undertaken as per the policies of the respective institutions. The policies
are judged to be very similar, and implementation will be organized in a way to reduce any duplication in reporting.
44. Internship program will be implemented by PC RS Roads. The interns will be provided with a recognition
certificate specifying the duration and scope of the work fulfilled in the Ministry/project entity. At the end of the internship
program, i.e. three months, the MOCT will evaluate the program and accordingly improve its parameters (e.g., scope,
duration, time of the internship, and the balance of practical and theoretical part) to maximize the learning effectiveness
and gain in professional and interpersonal skills.
45. At the state level, the Ministry of Finance and Treasury is responsible for negotiating the Financing Agreement
with IBRD and concluding Subsidiary Agreements with the entity. The RS MoF will enter into a subsidiary agreement with
PC RS Roads, to transfer the loan funds and implement the project.
46. In case of activation of contingent emergency response activities under Component 3, in order to ensure the
proper implementation PC RS Roads will need to ensure separate implementation arrangements requirements, including
preparation and adoption of a manual (“CERC Manual”) and of an Emergency Action Plan in form and substance acceptable
to the Bank.
B. Results Monitoring, Evaluation, and Verification Arrangements
47. Overall responsibility for monitoring and evaluation (M&E) of the outcomes of this Project lies with PC RS Roads.
During preparation, the team confirmed the capacity of PC RS Road company to collect and report on the results
framework indicators. The PIT within PC RS Roads will be responsible for preparing quarterly implementation reports and
one comprehensive annual monitoring and evaluation report, based on data available from the PC RS Roads financial and
asset management systems.
48. Project monitoring would entail close supervision of the civil works and technical assistance, social and
environmental risk and impact management, auditing financial statements, and monitoring project performance
indicators for the duration of the project as per the agreed indicators. A simple M&E management system will be
developed within the first 6 months of the Project. Data collection will be significantly facilitated by clearly defined and
reliable data sources, as described under the Project’s Result Framework. One of the technical experts within the PIT will
assume the responsibility to aggregate and consolidate data for reporting purposes.
49. The World Bank team will maintain regular interactions with the PIT and carry out frequent field visits. This will
allow the World Bank to undertake continuous monitoring and verification over and above its periodic formal
implementation support missions. A comprehensive evaluation of project results will be conducted during the project’s
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mid-term review and at project completion. Mid-term review will assess Projects performance in absorbing financing and
provide an opportunity to reassess and adjust capacity support to ensure that funds are allocated to meet the Project’s
objectives.
C. Disbursement Arrangements
50. Disbursements and flow of funds. Two DAs will be opened by the Ministry of Finance and Treasury of BiH, one
for each the IBRD loan and SSTP grant. Both DAs will be denominated in the EUR currency as selected by the borrower
(EUR). The disbursement methods made available are direct payments, reimbursements, special commitment and
advances. The ceiling and minimum amount for direct payments will be defined in detail in the Disbursement and Financial
Information Letters. The expenses will be documented using SOE only, or invoices in case of direct payments. Withdrawal
applications for the replenishments of the DAs will be sent to the Bank on a quarterly basis. Supporting documents for
SOEs, including completion reports and certificates, will be retained by the PIT and made available to the Bank during
project supervision. The funds will flow from the DAs directly to the PIT’s suppliers, or if direct payments are used, directly
from the loan account to the PIT’s suppliers.
51. Disbursement allocations. The Loan and Grant Agreement sets forth the eligible expenditures to be financed out
of the proceeds of the loan/grant, the allocation of the amounts of the loan/grant to each category, and the percentage
of eligible expenditure to be financed for each category.
IV. PROJECT APPRAISAL SUMMARY
A. Technical, Economic and Financial Analysis (if applicable)
Economic appraisal
52. Road User Costs. The table below provides the economic unit and basic characteristics of the current vehicle fleet
representative of Bosnia and Herzegovina, along with the average traffic composition on the project road.
Table 2. Vehicle Fleet Economic Unit Costs, and Characteristics
Car Bus Light Medium Heavy Artic.
Truck Truck Truck Truck
New Vehicle Cost (€) 16,500 200,000 30,000 80,000 110,000 190,000
New Tire Cost (€) 60 450 75 450 550 550
Fuel Cost (€/liter) 1.30 1.40 1.30 1.40 1.40 1.40
Lubricant Cost (€/liter) 15.60 18.30 15.60 18.30 18.30 18.30
Maintenance Cost (€/h) 13.48 13.48 13.48 13.48 13.48 13.48
Crew Cost (€/h) 14.40 45.06 16.05 19.24 19.24 21.90
Interest Rate (%) 8 8 8 8 8 8
Pass Work Time (€/h) 7.15 3.42 7.15 7.15 7.15 7.15
Pass Non-Work Time (€/h) 1.79 0.85 1.79 1.79 1.79 1.79
Cargo Time (€/h) 0.00 0.00 1.00 1.00 1.00 1.00
Annual Utilization (km) 16,000 70,000 30,000 40,000 55,000 80,000
Annual Utilization (hs) 500 2,000 800 2,000 2,000 2,000
Service Life (years) 12 12 8 12 14 14
Number Passengers (#) 3 25 1 1 1 1
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Work Related Pass Trips (%) 40 15 0 0 0 0
Operating Weight (tons) 1.1 12.6 1.5 2.7 14.2 30.1
ESA Loading Factor 0.00 0.80 0.01 0.45 2.28 2.95
Traffic Composition (%) 73.0% 12.0% 6.0% 4.0% 4.0% 1.0%
53. Highway Development and Management Model Version 2.09 (HDM-4) was used to undertake the economic
evaluation of the Route 2b. HDM-4 simulates life cycle conditions and costs and provides economic decision criteria for
multiple road design and maintenance alternatives. The quantified net benefits computed for the economic analysis of
the project roads comprise vehicle operating costs, travel time costs, road maintenance costs, economic costs of road
accidents, and environmental effects in terms of CO2 emissions costs. The project road works will result in reduced travel
time and vehicle operating costs, thus reducing travel costs. The evaluation applied a discount rate of 8 percent and an
assessment period of 20 years, beginning in 2026. All costs are expressed in constant 2024 Euro.
54. The current level of traffic on the Route 2b fully justifies the proposed upgrading works. With a width of 3.5
meters for two-way traffic and missing pavements in parts, the current road design is very unsafe and not aligned with
required BiH standards and is limiting overall traffic capacity. The project road has an estimated average annual average
daily traffic of 2,113 vehicles in 2026, of which 85 percent are cars, vans, buses, and the remainder 15 percent trucks. The
improved road quality is anticipated to stimulate economic development in areas along and near the road, leading to an
increase in traffic, assuming a traffic growth elasticity of 1.0 with respect to GDP growth as estimated by the International
Monetary Fund. The average speed on the project road is expected to increase from the current 40 km per hour to around
70 km per hour after project completion. In addition, the road works will make the roads more resilient to climate-related
events such as landslides and flash floods due to anticipated increase in frequency of heavy precipitation events. With the
proposed project, unit road user costs are expected to decrease by approximately 40 percent.
55. The cost-benefit analysis (CBA) indicates that the Economic Internal Rate of Return (EIRR) for the improvement
of the Route 2b is 15.1 percent. The Net Present Value is Euro 49 million at a discount rate of 8 percent, indicating that
the project is economically justified. A sensitivity analysis shows that for the scenario with a 20 percent increase in
construction costs, the EIRR is 12.6 percent. For the scenario with a 20 percent decrease in benefits, the EIRR is 12.0
percent. If both scenarios are combined, the EIRR is 9.7 percent. The breakdown of project benefits is as follows: normal
traffic benefits account for 70.2 percent of the total, generated traffic benefits contribute 6.9 percent, diverted traffic
benefits make up 22.4 percent, and CO2 emissions benefits represent 0.30 percent. The distribution of the project’s net
benefits is detailed in the table below.
Table 3. Distribution of Project Net Benefits
Road Agency Costs -60.4
Normal Traffic 76.8
Generated Traffic 7.5
Diverted Traffic 0.4
CO2 Emissions 24.5
Road Safety 0.2
Total 49.0
56. The GHG accounting assessment estimates that there will be a decrease in carbon dioxide (CO2) emissions on
the Route 2b with the project. The baseline CO2 emissions for the project (without project) are 133,505 tons and the
project gross CO2 emissions (with project emissions) are 119,602 tons. The total net and annual net CO2 emissions for the
project roads are - 13,903 tons and - 695 tons per year respectively. The decrease in CO2 emissions is attributed to the
decrease in fuel consumption with the project due to the increase in vehicle speeds.
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
57. As a part of due diligence, the World Bank team performed the backlog maintenance need assessment for the
1,776 km of the RS main road network based on latest IRI data from 2019 provided by the PC RS Roads. Backlog
maintenance and rehabilitation program assumptions are applied to all road sections with IRI between 3 and 8. The
backlog maintenance need assessment period considered 15 years period 2025-2039, 5 years of the intervention (2025-
2029) and 10-year period after intervention completion. Routine maintenance is applied both before and after
interventions, regardless of the IRI level. Backlog maintenance needs in unconstrained scenario have been estimated at
EUR 578 million, while for the optimal scenario (80 percent of unconstrained) would be EUR 460.1 million over the period
2025-2029 (i.e. EUR 92 million annually). The following unit cost estimates have been used depending on the reported IRI
and based on the recent prices for similar interventions in the region:
(a) Rehabilitation Class 1 for roads in fair condition (3<=IRI<5), which involves surfacing of 25-75mm with the average
unit cost of EUR 200,000 per km,
(b) Rehabilitation Class 2 for roads in poor condition (5<=IRI<8), which involves surfacing of 57-150mm with the
average unit cost of EUR 400,000 per km, and
(c) Reconstruction for roads in very poor condition (IRI>=8) with the average cost of EUR 1 million per km.
(d) On the other side, the average cost of interventions per km before investment was estimated at EUR 327,000 per
km regardless of the IRI category.
58. The PC RS Roads identified 12 sections as absolute priority for interventions in total length of 321km,
representing around 15 percent of the total main road network. The Project will support rehabilitation of around 100 km
of main roads out of these priority sections for the period 2025-2029. The final list of sections is not defined yet but will
be prioritized based on the Benefit Cost Ratio per sections blended with the network climate vulnerability considerations
and road safety assessments and will take into consideration the regional balance within RS territory.
59. The Cost Benefit Analysis (CBA) for 12 main road sections identified as priorities for rehabilitation, estimated
EIRR at 11.68 and B/C ratio of 1.50. The methodology used a standard incremental discounted analysis of project cost–
benefit streams. Investment costs are estimated based on the expected type of works and recent prices in the BiH, while
benefits were estimated based on expected travel time savings, vehicle operating costs, road safety benefits, and emission
savings. Travel time and vehicle operating costs benefits were computed within the backlog maintenance program. Road
safety benefits are based on the average fatalities and injuries per km of road but given that more accidents happen on
magisterial roads this could be considered as the conservative approach. Emission benefits are estimated based on the
World Bank shadow carbon prices.
60. The GHG assessment estimates that rehabilitation intervention on these 12 road sections will result in 5,896
tCO2 savings annually. The baseline CO2 emissions for the project (without project emissions) are 168,463 tons per year
and the project gross CO2 emissions (with project emissions) are 162,567 tons per year. The decrease in CO2 emissions is
attributed to the decrease in fuel consumption with the project due to the increase in vehicle speeds. Since the project
will finance approximately one third of identified priority sections, in minimum scenario it is expected to achieve around
1,380 tCO2 savings annually.
Technical appraisal
61. The road from Brod na Drini (Foča) to Hum and to the border bridge with the state of Montenegro (Šćepan Polje
- Plužine) is part of the Route 2b and is critical for resilience of wider network as it provides a direct connection between
Bosnia and Herzegovina and Montenegro and to capitals Sarajevo and Podgorica. Improvement of the road M-18 (E762)
has been recognized as strategic priority for Bosnia and Herzegovina as well as Montenegro. The current condition of the
road is very poor, with low design standards, narrow at 3.5m, and prone to landslides (more than 20 critical locations have
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
been identified) without any protection. The border bridge is also in poor condition and the current weight limits mean
the road is effectively closed to trucks and commercial vehicles. The road is in particularly poor condition on the section
from Donja Kopilova to Hum, a 12.6km section of which will be the subject of this Project. The border bridge will be
financed jointly by BiH and Montenegro and further 5.5km from Foca is already under rehabilitation using domestic
resources. It is expected that the road and bridge will complete in 2025 and 2026 respectively.
62. Feasibility studies and designs were prepared for the project in 2017 using European Union funding. Several
alignments were analyzed at the time and reassessed during appraisal of the project. The most favorable alignment goes
above the current alignment and will allow for improved geometry, and a pavement width of 6-6.5m and shoulder width
of 1-1.2m. Given that almost 10 years have passed since the design was prepared it will be necessary to undertake
additional geotechnical investigations and, if necessary, adjust the design. This is particularly the case at bridge locations
and where larger retaining walls are planned. Slope stability will be a key concern, and options to use of Nature Based
Solutions will be considered.
63. The project will be bid as a design build contract using yellow book FIDIC. The original designs will form the basis
for the tender, but the contractor will be expected to confirm and adjust the designs where necessary. Particular attention
will be given to solutions for water management, climate proofing of the road design and road safety measures. PC RS
Roads are currently managing a design build contract and have some experience, but the project will provide additional
capacity building and supervision as necessary.
64. The 12 two-lane road sections proposed for rehabilitation vary in geometry, geography, traffic demand, and
current quality. Each road has a width of 7-7.5m, while an average IRI level of 3.24, and traffic demand at the level up to
10,000 AADT. These road sections traverse various types of terrain, mainly hilly and mountainous regions. In 2019, the
targeted road sections for rehabilitation had an IRI of 3.24, however, if the proposed interventions are not implemented,
it is anticipated that by 2029, the IRI level for these road sections will deteriorate to 6.05. Among the proposed road
sections for rehabilitation, the busiest one is along the road M4, which runs from Border FBIH/RS to Mahala, Caparde, and
Karakaj with an AADT of 9,130. Conversely, the least occupied road section is M6, with an AADT of only 1,360 AADT, which
is also the section with the worst IRI (5,03).
65. Climate Co-Benefits: Like other Western Balkans countries, BIH is exposed to various natural hazards, some of
which are exacerbated by climate change impacts. Route 2b between Brod na Drini and Hum is particularly susceptible
to landslides with more than 20 critical landslide locations and climate change impacts are further undermining the
resilience of the road section. Prolonged droughts and heatwaves can cause degradation of vegetation, extreme drying
out of the soil cover, which makes the affected slopes along the road prone to erosion by both wind and heavy rainfall.
Consequently, heavy precipitation may easily induce flash floods causing the affected road sections to become impassable.
66. Investments over the entire road length will address climate vulnerabilities through both engineering measures
to address slope stability and drainage works, and the introduction of Nature Based Solutions for slope stability to
reduce the impacts of flash floods. These will include performing necessary geological investigations and ensuring that
the designs (even though prepared following the existing standards) comprise technical additions necessary for climate
resilience, ranging from solutions such as slope stabilization and rockfall management, drainage structure and wider drains
and culverts to accommodate heavy precipitation; application of natural based solutions; construction of new pavement
on concrete slab with side drainage and lighting works, etc. Given the high exposure to climate vulnerability in the project
area, all infrastructure investments will be designed to withstand extreme rainfall and flood events of 1 percent probability
of occurrence. The bridges construction/rehabilitation supported by the project will undertake structural
retrofits/reconstruction to withstand climate hazards. All rehabilitation interventions supported by the project will be
selected based on the cost benefit analysis and their contribution to improved road safety and resilience, while taking into
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consideration adequate geographical coverage. All designs will be done as per the best practices to increase resilience and
road safety. A targeted PDO indicator tracks that all project designs have incorporated climate resilience best practice and
recommendations from road safety inspections and audits, while targeted intermediate indicators for component 1 aim
to ensure that resilience considerations will be included in all (100 percent) designs and roads financed to protect network
from flash floods, landslides, etc.
67. Paris alignment. The operation is aligned with the goals of the Paris Agreement on both mitigation and
adaptation. Assessment and reduction of mitigation risks: The project subcomponent 1.1 will finance the upgrade and
improvement of the M-18 (Route 2b of the TEN-T network), connecting Sarajevo (BiH) and Podgorica (Montenegro),
improving BiH connectivity and regional integration and representing the shortest connection between Albania,
Montenegro and Bosnia and Herzegovina with Central and Northen Europe via Corridor Vc. This Subcomponent will also
finance all necessary culverts, interchanges and works on local connecting roads (while the intercountry bridge will be
financed by BiH), which will not involve capacity extension. The baseline carbon dioxide (CO2) emissions over the 20-year
evaluation period are estimated at 133,505 tons under the without-project scenario and 119,602 tons under the with-
project scenario, resulting in net CO2 emissions of -13,903 tons, or -695 tons per year. The decrease in CO2 emissions is
attributed to the decrease in fuel consumption due to the higher speeds on the project road with the project and the high
level of the diverted traffic. The Sub-component 1.2 will finance selected sections of the PC RS Roads program for
reconstruction, rehabilitation and maintenance of priority main roads with focus on resurfacing, partial pavement
widening, traffic signalization improvements, road safety improvements, access roads, and rehabilitation of bridges and
tunnels as well ancillary connections that will not involve capacity expansion. This sub-component is considered
Universally Aligned. Also, all activities under Component 2 are universally aligned with the Paris Agreement: they will
support enhanced road sector governance, in particular, improved safety and resilience of the BiH road network,
enhanced operational management, as well as project management and capacity building. There are no lower carbon
alternatives that can deliver the DO, including the railways, since they are not economically and financially viable or
technically feasible. The railway network requires major investments, and the existing amount of transport is insufficient
to generate sufficient income to cover costs 14. Based on the above, the operation is assessed to be of low risk with respect
to a BIH’s low-GHG emissions development pathways and is thus aligned from a mitigation perspective.
68. Assessment and reduction of adaptation risks: The road reconstruction financed by the project is in a
mountainous area experiencing extreme weather events such as increases in temperature and changes in rainfall with
anticipated increase in frequency, intensity and magnitude of precipitation events. 15 Given that the subject road route is
prone to landslides, rockfalls, erosion and flash floods caused by these extreme weather events, particular emphasis will
be placed on: sufficient drainage; adequate slope protection measures (e.g. steel nets; gabion walls, etc.) where the
widening of roads will take place into existing holes hill slopes with unfavorable geology, to prevent potential localized
landslides and rock falls; application of natural based solutions where applicable; construction of new pavement on
concrete slab with side drainage and lighting works; etc. The project will finance necessary design works, road safety audits
and site supervision. Designs will be informed by detailed geological investigations. Bidding documents for procurement
of rehabilitation designs, works and supervision will include detailed description of climate vulnerability status of project
location(s) and list requirements needed to address these vulnerabilities aiming at improved climate resilience of road
infrastructure. Regarding intensive rainfall events and the resulting potential erosion and flash floods, the measures to be
considered will include improved soil slope and road body drainage, culverts of appropriate capacity at design locations
and, where appropriate, nature-based solutions to reduce soil erosion and decrease surface runoff concentration time
and peak. The operation is designed to adequately reduce the physical climate risks to the project outcomes, and the
project’s climate resilience and adaptation design considerations limit the exposure to an acceptable level of residual risk
https://unfccc.int/sites/default/files/resource/ENG_CC%20adaptation%20and%20Low%20emission%20development%20Strategy%20BiH%202020-2030.pdf
14
https://thinkhazard.org/en/report/34-bosnia-and-herzegovina
15
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
for adaptation. Moreover, all sections selected for rehabilitation will be assessed for prevailing climate and natural hazards
and improved based on climate resilient design standards, including the use of Nature Based Solutions where appropriate.
B. Fiduciary
Financial Management
69. The existing FM arrangements of the PC Roads RS have been assessed to determine if these arrangements
(budgeting, accounting, reporting, internal control, staffing, funds flow, and audit) are acceptable for the project
implementation. Subject to implementation of the agreed action plan laid out below, the FM arrangements are
considered to meet the minimum requirements of the World Bank Operational policies.
70. An action plan has been agreed to strengthen the FM arrangements. The only action involves the preparation of
the FM sections of the POM. The PC Roads RS has already appointed a qualified person for the financial management
function and an acceptable accounting software for processing project transactions already exists.
71. The PIT will prepare semi-annual interim financial reports (IFRs), which include Sources and Uses of Funds, Uses
of Funds by Project Activity, Statement of Financial Position, Designated Account (DA) Reconciliation Statement, and
Statement of Expenditure (SOE) Withdrawal Schedule. The PIT shall prepare and furnish to the Bank not later than forty-
five (45) days after the end of each calendar semester, IFRs for the Project covering the semester, in form and substance
satisfactory to the Bank.
72. The PIT will be responsible for the timely compilation of annual Project financial statements for the
independent external audit. Project financial statements (including SOE and DA activities) will be audited by an
independent auditor acceptable to the World Bank and contracted by the Ministry of Finance and Treasury of BiH. Each
audit of financial statements will cover one fiscal year of the borrower, commencing with the fiscal year in which the first
withdrawal was made under the loan. In addition, the auditors are expected to deliver management recommendation
letters in relation to the Project, identifying any internal control deficiencies and accounting issues. Audit reports, audited
financial statements, and management recommendation letters will be delivered to the World Bank within six months
after the end of each fiscal year. The audited Project financial statements will be made publicly available in a timely
fashion, and in a manner acceptable to the World Bank.
Procurement
73. The Implementing agency has implemented IFI’s financed projects, but their experience with Bank funded
projects is very limited as the last Bank funded project they implemented was long time ago when old Procurement
Guidelines were in use and New Procurement Framework and STEP system did not exist. PC Roads RS will establish the
PIT before the project effectiveness by engaging a responsible PIT head and experts with experience in road construction
and rehabilitation, safety, asset management, procurement, social and environmental management, and financial
management. The procurement expert has already been mobilized on the Bank side to support the PC Road RS in preparing
the design and build tender documents as per the Bank Regulations under Component 1, subcomponent 1.1, which is one
of the mitigation measures taken to strengthen the Client’s procurement capacity and avoid possible delays in
implementation.
74. Based on the Procurement Framework Agreement and consequently the PIA between the EBRD and the IBRD,
procurement activities under Component 1, subcomponent 1.1 will be jointly co-financed by the EBRD and the IBRD,
whereas all other activities under the Project will be financed from the IBRD loan. As per the PIA, the WB will take the
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leading role in providing implementation support and monitoring procurement activities under the sub-component 1.1
and therefore the WB procurement regulations, policies and procedures will apply for this part of the project. This is also
the most complex procurement under the project and subject to International Competitive Bidding procedure (ICB), where
procurement will be conducted using Bank Standard Procurement Documents (SPD) for Design and Build. As per all other
components and their respective procurement activities funded from the WB loan, procurement will be carried out in
accordance with the World Bank Procurement Regulations for IPF Borrowers “Procurement in Investment Project
Financing for goods, works, non-consulting services and Consulting Services” (September 2023). The project will also be
subject to the World Bank’s Anti-Corruption Guidelines, dated July 1, 2016, and further will be governed by the provisions
stipulated in the Project Agreement (PA). The PIT will use the Systematic Tracking of Exchanges in Procurement (STEP)
system. STEP is a planning and tracking system, which would provide data on procurement activities, establish
benchmarks, monitor delays, measure procurement performance and enable annual Post reviews to be conducted online
using procurement related data and documents available in STEP.
75. Procurement Plan and Project Procurement Strategy for Development (PPSD) was prepared by the PC Roads to
outline the most effective procurement methods and market approaches to achieve the project's objectives efficiently
and cost-effectively. The initial Procurement Plan covering first 18 months of implementation has been developed and
will be further updated at least annually or as required to reflect the actual project implementation needs and
improvements in institutional capacity. The identified risks and the mitigation measures to address potential procurement
challenges are detailed in the PPSD. PPSD provides details on the approach for procurement of works, goods, non-
consulting and consulting services with applicable thresholds. Procurement Manual Section within POM will also outline
the procurement approach for individual procurements.
76. Procurement Supervision and Ex-post Review. Routine procurement reviews and supervision will be provided by
the Accredited Procurement Specialist based in the region. In addition, two supervision missions are expected to take
place per year during the first year of implementation, and once every subsequent year during which ex-post reviews will
be conducted for the contracts that are not subject to Bank prior review on a sample basis (20 percent in terms of number
of contracts).
C. Environmental, Social and Legal Operational Policies
77. The proposed Project is assessed as Substantial risk with respect to, both, environmental and social
management. The proposed Project will benefit the wider population by improving the overall road condition in BIH while
focusing on road safety and climate resilience. It will finance a program of multiple main road sections across Republika
Srpska and EU TEN-T Comprehensive Route 2b that connects Sarajevo to the border crossing with Montenegro at Scepan
polje. The proposed Project is focused on road rehabilitation works that would include works in sensitive terrain requiring
small culverts, extensive slope protection works and need for cut and fill, and some new construction. The locations
although multiple, include the largest component at Route 2b that is located in the proximity of two international
waterways, and protected areas of NP Sutjeska and the Tara UNESCO Biosphere. The project activities will generate dust
and noise, use of natural resources including sourcing of materials and fill, with possible excavations and management of
excavated material and waste, use of heavy machinery, impacts on traffic and possible impacts on surrounding sensitive
environments.
78. Nonetheless, all impacts anticipated at this stage can be mitigated through implementing sound practices that
would follow guidance from Framework documents and further will be integrated into the site specific ESIA and ESMP.
The PC RS Roads PIT has a full-time environmental specialist in house and a hired consultant that is supporting the Scepan
polje road section. The overall environmental risk of the Route 2b segment, as the most complex, is rated as Substantial
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building on the available capacity and the background preparatory work, including an already prepared EIA report for the
new alignment, which will serve as a basis for the site specific ESIA once the final alignment designs are available. The due
diligence prepared by EBRD through its engagement of CONNECTA will also feed into the final ESIA for the site. This section
will be financed in cooperation with EBRD through Mutual Reliance Agreement, whereby IBRD will be leading co-financier,
and its procurement guidelines will be followed. Integration of all existing documentation will be warranted through a
robust Terms of Reference for the site specific ESIA, which is to be prepared by an independent third party and outside of
the design-and-build contract anticipated for this activity. The provisions for Associated Facilities, as defined in the World
Bank’s Environmental and Social Standard 1 will follow the provisions included in the Environmental and Social
Management Framework (ESMF), when and if the Associated Facilities are identified.
79. The framework documents will apply to each and every proposed subproject and road section, which will first
be screened for environmental and social risks and impacts and then assigned a risk category along with the proposed
environmental and social due diligence to be prepared for each of the sites. The complete process is described in the
framework package of documents and will be integrated into the POM. Although, the general population will have
significant benefits in regard to the project, a portion of the planned investments, mostly related to infrastructure activities
under component 1, are likely to adversely affect communities that are hosting Project activities, as well as a wide range
of road users. The preliminary identified most important social issues, that the Project might be facing, are: (i) pushback
from road users in case of traffic stoppages or changes in traffic regimes and lack of adequate stakeholder engagement;
(ii) risks related to labor and working conditions including OHS issues due to civil works, inter alia, on rehabilitations of
tunnels and bridges (working at height); (iii) community health and safety risks that are standard for infrastructure works
(noise, dust, construction traffic increase) as well as potential labor influx due to high volume infrastructure work; (iv)
potential land acquisition and involuntary resettlement; and (v) failure to ensure inclusion of members of vulnerable
groups (including persons with disabilities).
80. Since specific locations of Project interventions are not identified with sufficient detail (including the final
alignment of the Route 2b) to provide a meaningful environmental and social analysis prior to the start of project
implementation, the Project has established a framework approach to identify at the extent possible potential
environmental and social risks and impacts related to the Project. Prior to appraisal the implementing agency has
prepared a set of environmental and social framework due diligence documentation, including ESMF, RPF, a Stakeholder
Engagement Plan (SEP), Labor Management Procedures (LMP) and the Environmental and Social Commitment Plan (ESCP).
The due diligence documents were disclosed on October 7, 2024 (on the website of PC Roads and Foca Municipality).
Apart from providing a contact point for all questions, comments and complaints, the team from PC Roads and Foca
Municipality have organized public consultations in Foca on October 29, 2024. No issues were noted during the
consultations, nor were there any issues communicated to the PC Roads team.
81. The PC RS Roads has two environmental/social specialists hired. However, the specialists needed additional
strengthening in using the World Bank’s framework approach (since the final alignment is not yet fully developed). In
recognizing the need to better understand and implement the Bank’s ESF through developing the ES capacity to prepare
ESMF, the Stakeholder Engagement Plan, and the Resettlement Policy Framework to guide environmental and social due
diligence successfully, the Environmental and Social Hands-on Expanded Implementation Support (ES HEIS) has been
provided to the client. ES HEIS aimed at increasing client capacities, support in preparation of all relevant ES documents
with confidence and expediting the project preparation given the constricted time frame. This timely capacity building will
more than likely also improve efficiency during project implementation and supervision.
82. Citizen engagements. The interventions under this project will be beneficial to local communities. BiH has made
considerable progress in involving the private sector in its effort to deliver an effective road network. However, it needs
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to adopt procedures used by more mature road organizations regarding communicating effectively with road-users and
the general public. BiH does not have well-established communication with road users, but information about road
condition is available. The public road company conduct public consultations with the affected population before starting
major road construction or reconstruction projects. However, no surveys have been undertaken by RS to assess road
users’ satisfaction. Through the operation, PC RS Roads will have better feedback and grievance mechanisms but also
improved visibility of future maintenance and capital investments. The project will also promote disclosure of annual
maintenance plans, procurement plans and use of geo-spatial systems for reporting and monitoring. To ensure the
feedback loop is closed, the Project will integrate a road user feedback mechanism and GRM, through an online
engagement platform for structured feedback processes and online engagement. This platform will not only serve to
disseminate relevant project information amongst citizens but also for all processes of the beneficiary feedback and GRM.
The platform will also be used as a tool to institutionalize annual user satisfaction surveys. In addition, the surveys will
have a targeted approach towards identified vulnerable groups and users to ensure their considerations are addressed in
a meaningful way. In order to ensure the closure of the feedback loop and facilitate open and transparent communication,
the results of the survey will be publicly disclosed on the Project’s website, and any recommendations resulting from the
surveys will be publicly consulted upon. The Project will provide training and capacity building for PC RS Roads on engaging
with road users and the public, including vulnerable groups in a meaningful way.
@#&OPS~Doctype~OPS^dynamics@padlegalpolicy#doctemplate
Legal Operational Policies Triggered?
Projects on International Waterways OP 7.50 No
Projects in Disputed Area OP 7.60 No
Grievance Redress Services:
83. Grievance Redress. Communities and individuals who believe that they are adversely affected by a project
supported by the World Bank may submit complaints to existing project-level grievance mechanisms or the Bank’s
Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed in order to address
project-related concerns. Project affected communities and individuals may submit their complaint to the Bank’s
independent Accountability Mechanism (AM). The AM houses the Inspection Panel, which determines whether harm
occurred, or could occur, as a result of Bank non-compliance with its policies and procedures, and the Dispute Resolution
Service, which provides communities and borrowers with the opportunity to address complaints through dispute
resolution. Complaints may be submitted to the AM at any time after concerns have been brought directly to the attention
of Bank Management and after Management has been given an opportunity to respond. For information on how to submit
complaints to the Bank’s Grievance Redress Service (GRS), visit http://www.worldbank.org/GRS. For information on how
to submit complaints to the Bank’s Accountability Mechanism, visit https://accountability.worldbank.org.
V. KEY RISKS
84. Risk related to Technical Design of the Project is Substantial. The PC RS Roads will use design and build approach
for the Route 2b road connecting BiH and Montenegro. Detailed designs from 2017 will be used as a preliminary design
to inform the Design and Build (D&B) contract. The D&B will require update of the geotechnical investigations at the most
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critical locations and adjustments of the designs as per the results of these investigations. The approach will ensure that
the designs used are adjusted to the difficult and climate vulnerable terrain. Still, managing D&B contract will require close
and knowledgeable supervision, by the supervision engineer and the road company as well. The Supervision Engineer will
be hired to undertake day to day supervision and the targeted training will be delivered to the PC RS Roads staff to mitigate
the risk.
85. Both Environmental and Social risks are Substantial. The proposed Project is focused on road rehabilitation works
that would include works in sensitive terrain requiring bridges, extensive slope protection works and need for cut and fill,
and some new construction. The locations although multiple, include the largest component at Scepan Polje that is in the
proximity of two international waterways, and protected areas of NP Sutjeska and the Tara UNESCO Biosphere. The project
activities will generate dust and noise, use of natural resources including sourcing of materials and fill, with possible
excavations and management of excavated material and waste, use of heavy machinery, impacts on traffic and possible
impacts on surrounding sensitive environments. Nonetheless, all impacts can be mitigated through implementing sound
practices integrated into the site specific ESIA. As project activities will depend on the final alignments to be designed
during implementation, the Project is being prepared with a set of environmental and social framework documents, while
site specific due diligence will be prepared during implementation and prior to start of any works. These documents will
also make use of the already prepared EIA and the due diligence prepared by EBRD on their side, while adapting them to
the requirements of the World Bank’s ESF and relevant ESSs. The PC RS Roads PIT has a full-time environmental specialist
in house and a hired consultant that is supporting revision of the already developed EIA for the Route 2b road section.
Although the overall risk assessed for Route 2b, as the most complex segment is between Substantial and High, the sound
project ownership and capacity of RS Roads, along with an already prepared EIA report have led to the environmental risk
being assessed as Substantial.
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ANNEX 1. RESULTS FRAMEWORK
@#&OPS~Doctype~OPS^dynamics@padannexresultframework#doctemplate
PDO Indicators by PDO Outcomes
Baseline Closing Period
Improved road connectivity and reduced travel time between Brod na Drini (Foca) and Hum (Scepan Polje)
Reduced travel time between Brod na Drini (Foca) and Hum (Scepan Polje) (Minutes)
Sep/2024 Oct/2030
24 13
Safer and more resilient regional road network
All project designs have incorporated climate resilience best practice and agreed recommendations from road safety inspections and audits (Percentage)
Sep/2024 Oct/2030
0 100
Road users, communities and business benefit from improved roads
Direct users that benefit from improved access to sustainable transport infrastructure and services (Number of people) CRI
Sep/2024 Oct/2030
0 386,500
Direct users that benefit from improved access to sustainable transport infrastructure and services - Female (Number of people) CRI
Sep/2024 Oct/2030
0 196,000
Direct users that benefit from improved access to sustainable transport infrastructure and services - Youth (Number of people) CRI
Sep/2024 Oct/2030
0 64,000
The management of the sector is enhanced
Annual and multiannual business plans are developed based on the outputs from RAMS that integrate information on resilience and road safety and reported against (Yes/No)
Sep/2024 Oct/2030
No Yes
Intermediate Indicators by Components
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The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project(P502979)
Baseline Closing Period
Improved Regional Connectivity
Length of route 2b constructed (Kilometers)
Sep/2024 Oct/2030
0 12.60
Road safety Audit completed on Route 2b (Yes/No)
Sep/2024 Oct/2030
No Yes
Length of regional road network rehabilitated (Kilometers)
Sep/2024 Oct/2030
0 100
RSA on road designs performed (Percentage)
Sep/2024 Oct/2030
0 100
Resilient measures implemented to protect network from flooding, flash floods, and landslides (Percentage)
Sep/2024 Oct/2030
0 100
Enhanced Road Sector Management
Weigh-in-motion system installed (Yes/No)
Sep/2024 Oct/2030
No Yes
RAMS upgraded to incorporate economic prioritization (Yes/No)
Sep/2024 Oct/2030
No Yes
Female participating in the paid internship program (Number)
Sep/2024 Oct/2030
0 18
Road users reporting satisfaction with process of infrastructure service delivery, gender disaggregated (Percentage)
Sep/2024 Oct/2030
0 80
Percentage of female reporting satisfaction with process of infrastructure service delivery (Percentage)
Sep/2024 Oct/2030
0 50
Road safety inspection on main and regional road network completed (Number)
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The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project(P502979)
Sep/2024 Oct/2030
0 1,000
Female interns employed (Number)
Sep/2024 Oct/2030
0 5
Women representation in key expert positions (Number)
Sep/2024 Oct/2030
0 10
Climate vulnerability assessment performed (Kilometers)
Sep/2024 Oct/2030
0 200
Contingent Emergency Response
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The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
Monitoring & Evaluation Plan: PDO Indicators by PDO Outcomes
Improved road connectivity and reduced travel time between Brod na Drini (Foca) and Hum (Scepan Polje)
Reduced travel time between Brod na Drini (Foca) and Hum (Scepan Polje) (Minutes)
Description Time needed to drive the 12.6km section before and after intervention will be reduced for 45%
Frequency Annually
Data source Annual Implementation reports
Current average speed at the section is estimated at 32km/h, meaning that 24 minutes is needed to drive through this
Methodology for Data
section currently. With the intervention the speed should be increased to average 60km/h, resulting in expected travel
Collection
time of 13 minutes.
Responsibility for Data
PIT within PC RS Roads
Collection
Safer and more resilient regional road network
All project designs have incorporated climate resilience best practice and agreed recommendations from road safety inspections and audits
(Percentage)
Road safety audit and climate vulnerability assessments will be performed on all designs and their recommendations will
Description
be included in the final design. All interventions under the loan will be based on designs that incorporated these inputs.
Frequency Semi-annualy
Data source Semi-annual progress reports
Methodology for Data
Reports from Road Safety Audit consultant and from the PIT design reviewes and approvals
Collection
Responsibility for Data
PIT within PC RS Roads
Collection
Road users, communities and business benefit from improved roads
People benefiting from improved access to sustainable transport infrastructure and services (Number of people)
Measuring the number of direct beneficiaries of the improved transport infrastructure. Road users are considered to be
Description
direct beneficiaries. People living across BIH are considered to be indirect beneficiaries.
Frequency Annually
Data source Annual Implementation reports
Route 2b has an average annual average daily traffic of 2,113 vehicles in 2026, of which 85% are cars, vans, buses, and
the remainder 15% trucks. The sections to be rehabilitated have an annual average daily traffic of 9,000. Coeficient for
Methodology for Data
car occupancy is 3 occupancy of private cars and 25 people occupance of buses. Estimated number of direct
Collection
beneficiaries is estimated 386,500. Final number of direct beneficiaries will be reported in the annual implementation
report based on the estimated AADT on the subject roads.
Responsibility for Data
PIT within PC RS Roads
Collection
People benefiting from improved access to sustainable transport infrastructure and services – Youth (Number of people)
Description Number of young people benefiting from the road interventions
Frequency Annually
Data source Annual Implementation reports
Methodology for Data Percentage of youth in the total population will be used to estimate the number of youth. Average young population
Collection in BIH and Montenegro is around 16 percent.
Responsibility for Data
PIT within PC RS Roads
Collection
People benefiting from improved access to sustainable transport infrastructure and services – Female (Number of people)
Description Number of female population benefiting from the road interventions
Frequency Annually
Data source Annual Implementation reports
Methodology for Data Percentage of women in total population will be used to estimate the number of women, where average percentage
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The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
Collection of women in total population is slightly above 50 percent.
Responsibility for Data
PIT within PC RS Roads
Collection
The management of the sector is enhanced
Annual and multiannual business plans are developed based on the outputs from RAMS that integrate information on resilience and road safety
and reported against (Yes/No)
Description The business plans are prepared by using the outputs from RAMS for prioritization of interventions and reported upon.
Frequency Annually
Data source Annual Implementation reports
Annual busines plans and outputs from RAMS consultant will serve as a basis for reporting on the achivement of this
Methodology for Data
milestone. PIT will include this information in the annual implementation reports with the examples of how the
Collection
subject intervention was implemented.
Responsibility for Data
PIT within PC RS Roads
Collection
Monitoring & Evaluation Plan: Intermediate Results Indicators by Components
Improved Regional Connectivity
Length of Route 2b constructed (Kilometers)
Description Length of newly constructed road along Route 2b in km
Frequency Semi-annualy
Data source Semi-annual progress reports
Methodology for Data Collection Based on the supervisor engineer reports on the phisical and financial progress of works on Route 2b
Responsibility for Data Collection PIT within PC RS Roads
Road safety Audit completed on Route 2b (Yes/No)
Description Road Safety Audit performed on final designs for the Route 2b construction
Frequency Semi-annualy
Data source Semi-annual progress reports
Approved RSA report and PIT report on inclusion of the proposed measures in the final design for Route
Methodology for Data Collection
2b
Responsibility for Data Collection PIT within PC RS Roads
Length of regional road network rehabilitated (Kilometers)
Description Length of the rehabilitated roads in kilometers
Frequency Semi-annualy
Data source Semi-annual progress reports
Methodology for Data Collection Technical Acceptance reports on the rehabilitated sections
Responsibility for Data Collection PIT within PC RS Roads
RSA on road designs performed (Percentage)
Description RSA on designs for rehabilitation developed and accepted by the client
Frequency Annually
Data source Annual implementation reports
RSA consultant reports will serve as a basis, while the PIT will include information on whether these
Methodology for Data Collection
measures have been included in the final design as part of annual implementation reports
Responsibility for Data Collection PIT within PC RS Roads
Resilient measures implemented to protect network from flooding, flash floods, and landslides etc (Percentage)
All infrastructure investments will be designed to withstand extreme rainfall and flood events of 1%
Description
probability of occurrence
Frequency Annually
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Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
Data source Annual Implementation reports
PIT annual reports will include information on the engineering aspects of the tendered designs, observed
Methodology for Data Collection
vulnerabilities, and how and whether necessary resilience measures have been included
Responsibility for Data Collection PIT within PC RS Roads
Enhanced Road Sector Governance
Weigh-in-motion system installed (Yes/No)
Description WIMS installed on pilot locations
Frequency Annually
Data source Annual Implementation reports
WIMS consultant will report on the achivements in the final report and PIT will reflect this together with
Methodology for Data Collection
information on the effects of these measures in annual reports.
Responsibility for Data Collection PIT within PC RS Roads
RAMS upgraded to incorporate economic prioritization (Yes/No)
RAMS upgrade modules, including economic module and integration of information on safety and resilience,
Description
developed and integrated with the current road inventory
Frequency Annually
Data source Annual Implementation reports
RAMS consultant will include this information in relevant reports, which will be reflected in the annual
Methodology for Data Collection
implementation reports
Responsibility for Data Collection PIT within PC RS Roads
Road users reporting satisfaction with process of infrastructure service delivery, gender disaggregated (Percentage)
Description Percentage of road users reporting satisfaction with the infrastructure service delivery
Frequency Annually
Data source Annual Implementation reports
PIT will organize road users survey and report against it in agreement with the Bank social expert on
Methodology for Data Collection
annual basis throughout the project life
Responsibility for Data Collection PIT within PC RS Roads
Percentage of female reporting satisfaction with process of infrastructure service delivery (Percentage)
Description Percentage of female road users reporting satisfaction with the infrastructure service delivery
Frequency Annually
Data source Annual Implementation reports
PIT will organize road users survey and report against it in agreement with the Bank social expert on
Methodology for Data Collection
annual basis throughout the project life
Responsibility for Data Collection PIT within PC RS Roads
Road safety inspection on main road network completed (Number)
Description Road Safety inspection (RSI) of the existing main road network
Frequency Semi-annualy
Data source Semi-annual progress reports
RSI Consultant will regularly report on the achivements under its contract and this information will be
Methodology for Data Collection
reflected in the querterly and annual progress reports
Responsibility for Data Collection PIT within PC RS Roads
Female participating in the paid intership program (Number)
Number of female university students/graduates recruited for a three-month paid internship program in
Description
project entities within the transport sector
Frequency Semi-annualy
Data source Semi-annual progress reports
Methodology for Data Collection PIT will report on this number within querterly and annual progress reports
Responsibility for Data Collection PIT within PC RS Roads
Female Interns employeed (Number)
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The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
Description Number of female interns transitioned into guaranteed permanent roles in companies/project entities
Frequency Annually
Data source Annual Implementation reports
Methodology for Data Collection PIT will report on the number of females employed within annual implementation reports
Responsibility for Data Collection PIT within PC RS Roads
Women representation in key expert positions (Number)
Description Number of women in a key expert positions within the awarded tenders financed by the loan
Frequency Semi-annualy
Data source Semi-annual progress reports
Methodology for Data Collection PIT will report on this number within querterly and annual progress reports
Responsibility for Data Collection PIT within PC RS Roads
Climate Vulnerability Assessment performed (Kilometers)
Climate vulnerability assessment on priority main network performed and delivered in the form usable by
Description
the RAMS
Frequency Annually
Data source Annual implementation reports
Methodology for Data Collection Climate vulnerability assesment consultant report
Responsibility for Data Collection PIT within PC RS Roads
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The World Bank
Sustainable, Integrated and Safe Road Infrastructure Project (P502979)
ANNEX 2: Road M-18 Brod na Drini – Hum – Šćepan Polje, Route 2b
Background and Context of the Project
1. For BiH, the indicative extension to the TEN-T road network includes the main North-South Road corridor (Vc) and
four routes (No.1, No.2, No.3, and No.9). Route 2b is 396 km long and passes through Sarajevo and connects to Podgorica
in Montenegro and Valon in Albania. The road from Brod na Drini (Foča) to Hum and to the border bridge with the state
of Montenegro (Šćepan Polje - Plužine) is part of the Route 2b and is recognized as strategic priority because it provides
the only link between Sarajevo and Podgorica. Improving the road to climate-resilient standards is therefore a priority for
both BiH and Montenegro governments, particularly given the recent floods that destroyed its critical transport
infrastructure. The latest TCT Study 16 on climate resilience and adaptation also identified this road as amongst the top 20
most vulnerable links on the Western Balkan TEN-T Road Network, and its climate-resilient rehabilitation will result in a
transformative investment that will attribute adaptive capacity to the entire region as this investment will protect the
areas surrounding this primary road link beyond climate proofing it and ensure functionality of this route during climate
events and other emergencies.
2. The existing Brod na Drini (Foča)-Hum (Šćepan Polje), shown on Figure 1, is in poor condition due to the
accelerated deterioration resulting from climate change exacerbated events. Poor maintenance, old age, current and
projected traffic volume are not driving this deterioration; instead, climate events are. The road has suffered numerous
landslides events due to changing rainfall patterns, and currently has more than 20 nodes identified as being prone to
landslides from projected climate change-induced rainfall. The section from Donja Kopilova to Hum (12.6 km) and the
subject of this project is in particularly poor condition. Current speeds are as low as 30km/h, the pavement width is 3.5m
with poor pavement condition, insufficient slope stabilization measures and road shoulders and safety measures that are
in poor condition or missing. Flooding is a particular risk for the road but snowfall during the winter also poses risks (Figure
2). The interstate bridge (between BiH and Montenegro) only provides a temporary solution for crossing over the Tara
Canyon. The bridge is paved with wooden beams, many of which are damaged and resulted in a loading limit that has
closed the bridge to trucks and commercial vehicles since 2019. The construction of a new bridge and access road will be
jointly financed by BiH and Montenegro. Works have already started on the 5.5 km of road from Foca which has been
financed by the RS budget.
Figure 1: Landslide on existing road, collapse of retaining wall Figure 2: Levelling of alignment over time due to road settlement.
16
Transport Community Treaty Permanent Secretariat study on “Improving climate resilience and adaptation measures in the
indicative extension of TEN-T road and rail networks in Western Balkans”.
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3. The preparation of the feasibility study and main designs for the Project was funded by the European Union in
2017. The designer recognized three sections on the link – sections A, B, C – and explored several alternative alignments
with the favored option running uphill of the existing alignment. A large part of the proposed new route is 40 – 50 meters
above the existing road. This chosen alternative will include 14 structures and about 2.9 km of slow vehicle lanes. The
project was originally conceived to be implemented in only one phase, but over time a phased implementation has started
as follows:
4. Phase 1. The first phase of implementation of 5.6km (chainage 0 - 5.6 km), section A, is underway and financed
from PC RS Roads budget. The works are mainly on the existing alignment with works focused on “straightening” the
geometry by eliminating tight curves, widening the pavement width to 6–6.5 m, including shoulders with width of 1–1.2m,
and providing safety barriers. The works will also focus on reducing climate vulnerability and will include extensive
drainage requirements and remedial works to address suspended landslides in two locations, marginally stable slopes in
three locations and an active landslide in a location over a length of 200 m. The works started in October 2022, and the
completion of the works is planned by mid-2025.
5. Phase 2. The second phase, Section C, is the construction of the border bridge over the Tara River with necessary
access roads (chainage 18.18 – 19.14 km). This phase of implementation will be financed by BiH and Montenegro with
tender expected to be launched by the end of 2024 and completion date expected by end 2026.
6. Phase 3. The third phase, Section B, the subject of this Project, has a length of 12.6 km (chainage 5.56 – 18.18 km)
and is the most challenging section. The first design for the road was made back in 1976 and designed to avoid the
construction consequences of a planned hydro power plant called “Buk Bijela” which was later cancelled. As part of that
some earth works and retaining structures were built and again in 1991 two further viaducts and several retaining walls
were built. The latest design tried to keep these two viaducts but following a detailed inspection it has been concluded
that those structures will need to be demolished.
7. The latest design, from 2017, will also need to be updated by the design build contractor. Additional geotechnical
investigations will need to be undertaken, and the design adjusted accordingly. The contractor will need to confirm and
adjust proposed solutions for management of water flows and climate proofing of the road both through engineering
structures and through the extensive use of nature-based solutions to support slope stability. Given the nature of the
terrain and the vulnerability of the road to extreme climatic events, a substantial part of the overall investment, estimated
at EUR 94 million, will be dedicated to climate proofing the road. This will particularly be related to drainage, retaining
structures and slope stabilization works.
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