FOR OFFICIAL USE ONLY Report No: PAD00120 INTERNATIONAL DEVELOPMENT ASSOCIATION PROJECT APPRAISAL DOCUMENT ON A PROPOSED CREDIT IN THE AMOUNT OF US$50 MILLION AND A CREDIT IN THE AMOUNT OF JPY 11,236,300,000 (US$76 MILLION EQUIVALENT) (IDA SCALE-UP WINDOW SHORTER MATURITY LOAN) TO THE REPUBLIC OF RWANDA FOR A KIGALI LOGISTICS PLATFORM CONNECTIVITY DEVELOPMENT PROJECT MARCH 8, 2024 Transport Global Practice Eastern and Southern Africa Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective {January 31, 2024}) Rwandan Franc Currency Unit = (RWF) US$1 = JPY 148 US$1 = RWF 1,270 FISCAL YEAR January 1 - December 31 Regional Vice President: Victoria Kwakwa Regional Director: Wendy E. Hughes Country Director: Keith E. Hansen Practice Manager: Almud Weitz Task Team Leaders: Aguiratou Savadogo-Tinto, Alejandro Espinosa-Wang ABBREVIATIONS AND ACRONYMS AM Accountability Mechanism AWPB Annual And Work Plan and Budget CCDR Country Climate and Development Report CERC Contingent Emergency Response Component CO2 Carbone Dioxide CPF Country Partnership Framework DBM Design, Build and Maintain DFIL Disbursement And Financial Information Letter DG Director General DP World Dubai Port World DRC Democratic Republic of the Congo E&S Environment and Social EAC East African Community EIRR Economic Internal Rate of Return EOI Expression of Interest ESCP Environmental and Social Commitment Plan ESMF Environmental and Social Management Framework ESS Environment and Social Standards FRDP Feeder Roads Development Project GBVPRAP Gender-Based Violence Prevention and Response Action Plan GDP Gross Domestic Product GGRCS Green Growth and Climate Resilience Strategy GHG Green House Gas GoR Government Of Rwanda GRM Grievance Redress Mechanism GRS Grievance Redress System HDM Highway Development and Management Model HEIS Hands-On Expanded Implementation Support IA Implementing Agency IC Identified As Consultant ICB International Competitive Bidding IDA International Development Association IFMIS Integrated Financial Management Information System IFRs Interim Financial Reports i IPF Investment Project Financing iRAP International Road Assessment Program JICA Japan International Cooperation Agency KLP Kigali Logistic Platform KMs Kilometers KPIs Key Performance Indicators LMP Labor Management Plan LVTP Lake Victoria Transport Program LED Light Emitting Diode MT Million Tons MINECOFIN Ministry of Finance and Economic Planning MINICOM Ministry of Trade and Industry MININFRA Ministry of Infrastructure NBIA New Bugesera International Airport NDC Nationally Determined Contributions NPV Net Present Value MTR Midterm Review M&E Monitoring and Evaluation OAG Office of the Auditor General OPBRC Output and Performance Based Road Contracting ORAT Operational Readiness and Airport Transfer PCE Private Capital Enabling PDO Project Development Objective PIM Project Implementation Manual PPSD Project Procurement Strategy for Development PRAMS Procurement Risk Assessment and Management System PS Permanent Secretary QCBS Quality and Cost Based Selection RDB Rwanda Development Board RECOR Rwanda Emergency Connectivity Restoration Project REMA Rwanda Environment Management Authority RPF Resettlement Policy Framework RFA Rwanda Forest Authority RMF Road Maintenance Fund RNP Rwanda National Police ROW Right of Way ii RAP Resettlement Action Plan RPPA Rwanda Public Procurement Authority RSB Rwanda Standard Board RTDA Rwanda Transport Development Agency RURA Rwanda Utilities Regulatory Authority RWB Rwanda Water Board SEZ Special Economic Zones SME Small and Medium-sized Enterprises SPIU Single Project Implementation Unit WBG World Bank Group iii Table of Contents DATASHEET ....................................................................................................................................................................................... v I. STRATEGIC CONTEXT............................................................................................................................................................. 1 A. Country Context.................................................................................................................................................................... 1 B. Sector Background ................................................................................................................................................................ 2 C. Relevance to Higher Level Objectives.................................................................................................................................... 5 II. PROJECT DESCRIPTION .......................................................................................................................................................... 6 A. Project Development Objective ............................................................................................................................................ 6 B. Project Components ............................................................................................................................................................. 7 C. Project Beneficiaries ........................................................................................................................................................... 10 D. Results Chain ...................................................................................................................................................................... 11 E. Rationale for Bank Involvement and Role of Partners ......................................................................................................... 11 F. Lessons Learned and Reflected in the Project Design .......................................................................................................... 12 III. IMPLEMENTATION ARRANGEMENTS .................................................................................................................................. 12 A. Institutional and Implementation Arrangements ................................................................................................................ 12 B. Results Monitoring and Evaluation Arrangements .............................................................................................................. 13 C. Sustainability ...................................................................................................................................................................... 13 IV. PROJECT APPRAISAL SUMMARY ......................................................................................................................................... 13 A. Technical, Economic and Financial Analysis ........................................................................................................................ 13 B. Fiduciary ............................................................................................................................................................................. 17 C. Legal Operational Policies ................................................................................................................................................... 19 D. Environment and Social ...................................................................................................................................................... 19 V. GRIEVANCE REDRESS MECHANISM (GRM) .......................................................................................................................... 23 VI. KEY RISKS ............................................................................................................................................................................ 23 VII. RESULTS FRAMEWORK AND MONITORING ......................................................................................................................... 25 Annex 1: Implementation Arrangements and Support Plan ............................................................................................................ 33 iv @#&OPS~Doctype~OPS^dynamics@padbasicinformation#doctemplate DATASHEET BASIC INFORMATION Project Operation Name Beneficiary(ies) Rwanda Kigali Logistics Platform Connectivity Development Project Environmental and Social Risk Operation ID Financing Instrument Classification Investment Project P180228 High Financing (IPF) @#&OPS~Doctype~OPS^dynamics@padprocessing#doctemplate 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 28-Mar-2024 30-Sep-2030 Bank/IFC Collaboration No Proposed Development Objective(s) The objectives of the Project are to improve resilient and safe connectivity from the KLP (Masaka) to the regional logistics corridors and support local and regional economic activities around the corridors. Components Component Name Cost (US$) Component 1:Improving physical infrastructure 105,440,000.00 Component 2: Trade facilitation and Logistics improvement 26,510,000.00 v Component 3: Implementation support, monitoring, and capacity building 7,000,000.00 Component 4: Contingency Emergency Response (CERC) 0.00 Physical Contingencies 1,000,000.00 @#&OPS~Doctype~OPS^dynamics@padborrower#doctemplate Organizations Borrower: Republic of Rwanda Ministry of Infrastructure (MININFRA), Ministry of Trade and Industry (MINICOM), Implementing Agency: Rwanda Transport Development Agency (RTDA) @#&OPS~Doctype~OPS^dynamics@padfinancingsummary#doctemplate PROJECT FINANCING DATA (US$, Millions) Maximizing Finance for Development Is this an MFD-Enabling Project (MFD-EP)? No Is this project Private Capital Enabling (PCE)? Yes SUMMARY Total Operation Cost 139.95 Total Financing 139.95 of which IBRD/IDA 126.00 Financing Gap 0.00 DETAILS World Bank Group Financing International Development Association (IDA) 126.00 IDA Credit 50.00 IDA Shorter Maturity Loan (SML) 76.00 Non-World Bank Group Financing Counterpart Funding 13.95 Borrower/Recipient 13.95 IDA Resources (US$, Millions) vi Guarantee Credit Amount Grant Amount SML Amount Total Amount Amount Scale-Up Window 0.00 0.00 76.00 0.00 76.00 (SUW) National Performance-Based 50.00 0.00 0.00 0.00 50.00 Allocations (PBA) Total 50.00 0.00 76.00 0.00 126.00 @#&OPS~Doctype~OPS^dynamics@paddisbursementprojection#doctemplate Expected Disbursements (US$, Millions) WB Fiscal Year 2024 2025 2026 2027 2028 2029 2030 Annual 5.00 20.00 30.00 35.00 20.00 10.00 6.00 Cumulative 5.00 25.00 55.00 90.00 110.00 120.00 126.00 @#&OPS~Doctype~OPS^dynamics@padclimatechange#doctemplate PRACTICE AREA(S) Practice Area (Lead) Contributing Practice Areas Transport Finance, Competitiveness and Innovation CLIMATE Climate Change and Disaster Screening Yes, it has been screened and the results are discussed in the Operation Document @#&OPS~Doctype~OPS^dynamics@padrisk#doctemplate 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 ⚫ Moderate vii 5. Institutional Capacity for Implementation and Sustainability ⚫ Substantial 6. Fiduciary ⚫ Moderate 7. Environment and Social ⚫ High 8. Stakeholders ⚫ Moderate 9. Overall ⚫ Substantial @#&OPS~Doctype~OPS^dynamics@padcompliance#doctemplate 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). viii @#&OPS~Doctype~OPS^dynamics@padlegalcovenants#doctemplate LEGAL Legal Covenants Sections and Description No later than sixty (60) days after the Effective Date, the Recipient shall establish and thereafter maintain throughout the Project implementation period the Project implementation unit within the Ministry of Industry and Trade (MINICOM SPIU) with resources and composed of key staff (including SPIU coordinator, financial management specialist, procurement specialist, e-commerce specialist, a trade specialist, a civil engineer, an environment specialist, a social specialist, a gender specialist and a community development officer); all with qualifications, experience and under terms of reference acceptable to the Association as may be further detailed in the Project Implementation Manual. No later than thirty-six (36) months after Effective Date, the Recipient shall in conjunction with the Association, carry out a mid-term review of the Project (the "Mid-term Review), covering the project achieved in the implementation of the Project. @#&OPS~Doctype~OPS^dynamics@padconditions#doctemplate Conditions Type Citation Description Financing Source The Recipient has prepared and adopted the Project Implementation Manual in Effectiveness Article IV, 4.01 IBRD/IDA the form and substance satisfactory to the Association ix I. STRATEGIC CONTEXT A. Country Context 1. Rwanda’s topography, lack of natural resources, limited domestic market, and rural-centric population are prevalent of the country’s physical and economic landscape. Bordered by four countries - Democratic Republic of the Congo (DRC) in the west, Uganda in the north, Tanzania in the east, and Burundi in the south - the geographic challenges of a landlocked country with numerous high-altitude mountains constrain the country’s options for spatial development. Rwanda’s high population density of 13.2 million inhabitants, with a median age of 19, occupy an area of 26,338 km2 (503 inhabitants/km2).1 Consequentially, job creation has favored services that embody higher-than-average education and skill requirements. Indeed, services account for 30 percent of total employment (triple the share in the early 2000s), half of Gross Domestic Product (GDP), and a rising share of foreign exchange earnings.2 2. Despite the geographic challenges, population’s youthful demographics, and modest internal market, Rwanda has achieved impressive socio-economic progress in recent decades. Growth in GDP per capita averaged five percent per year since the early 2000s, second only to Ethiopia in Africa. High levels of public investment (averaging 15 percent of GDP in recent years) improved access to water, sanitation, electricity, and housing. Poverty fell from 77 to 55 percent and from 59 to 38 percent from 2001 to 2017, according to international and national poverty lines, respectively. After approaching 10 percent growth in 2019, restrictions associated with COVID-19 caused GDP to contract by 3.4 percent in 2020, causing the first recession since 1994. High vaccination rates of almost 70 percent (2nd highest in Sub-Saharan Africa [SSA]) and a resilient economy allowed growth to rebound by over 10 percent in 2021, after lifting mobility restrictions. Global conditions in 2022 caused GDP growth to slow to 6 percent, but an expansion of 6.7 percent and 7 percent is estimated for 2023 and 2024, respectively. 3 3. Rwanda’s Vision 2050 provides the strategic foundation for high economic growth to reach upper middle- income status by 2035 and high-income status by 2050. These ambitious goals imply growth rates exceeding 12 percent per year, requiring new avenues for growth through innovation, integration, agglomeration, and competition.4 With its challenging geography, small market size, and central location, Rwandan future competitiveness is intrinsically linked to its connection with its neighbors and beyond. As the East African Community (EAC) becomes increasingly integrated, activities in trade, transport, and tourism are foreseen by the country’s National Strategy for Transformation 2017-2024 as leading Rwanda’s development framework. One of the Government of Rwanda’s (GoR) core development objectives is to develop multimodal transport hubs that link Rwanda and its neighbors to regional and international markets based on efficiently integrating upgraded road, rail, and air transport networks.5 4. Rwanda is highly vulnerable to the impacts of natural hazards and climate change and is already experiencing the impacts with the rising occurrence of floods, droughts, soil erosion, and landslides. In 2021, Rwanda ranked 154 out of 185 countries in the Notre Dame Vulnerability Index indicating high exposure, sensitivity, and low ability to adapt to the negative impacts of climate change.6 Rwanda faces high risks from river and urban floods, landslides, and wildfires; medium risk from water scarcity, volcano eruption, and earthquakes; and low risk from extreme heat.7 Consequently, the frequency and severity of disastrous weather events have risen since the early 2000s and caused substantial losses. The rise in heavy rainfall events, particularly in the northern and western provinces, are leading to frequent riverine flooding, flash floods, and landslides, damaging infrastructure, harming the environment, and even causing loss of life.8. In May 2023, Rwanda faced flooding and a series of landslides that cost more than 130 lives and damaged 20 national roads, 21 1 National Institute of Statistics for Rwanda, Government of Rwanda, Fifth Population and Housing Census, 2022 2 The World Bank, Fostering Rwanda’s Competitiveness & Resilience in the Post COVID-19 era, 2022. 3 The World Bank, Rwanda Economic Update, Edition 19, September 2022. 4 The World Bank, Future Drivers of Growth in Rwanda , 2019. 5 The World Bank, Fostering Rwanda’s Competitiveness & Resilience in the Post COVID -19 era, 2022. 6 University of Notre Dame, Notre Dame Global Adaptation Initiative, 2021. 7 ThinkHazard, consulted on 21st January 2024. 8 The World Bank Group, Climate Change Knowledge Portal, 2021. 1 district roads, and 47 bridges, disconnecting districts, and impeding country supply through land transportation. The eastern and southern regions of the country have experienced frequent dry episodes, alternating with rainfall excesses. 5. Climate change is likely to further increase the risks from extreme events. Climate projections indicate continued regional variability in precipitation levels. Annual mean temperature is projected to increase and there is a strong likelihood of longer heatwaves with as much as 85 days per year9. Climate-related shocks, including the recent prolonged droughts, risk slowing progress in poverty reduction. About 40 percent of the population in the western, southern, and northern provinces are exposed to landslides and flooding risks, with the eastern province exposed mostly to drought hazards. The estimated annual economic costs of these climate risks will reach one percent of GDP by 2030.10 6. Rwanda significantly improved gender equality over the years but challenges remain. Achievements consist of constitutional and legal reforms, policies to encourage sector-based gender inclusion, as well as national planning strategies for the empowerment of women and girls. In 2021, female adult literacy was 73 percent compared to 79 percent for males. In addition, the 2023 Women, Business, and the Law report scored Rwanda 83.8 out of 100, higher than the 72.6 average score for SSA. However, laws that enable quality work after having children, ensure non-discrimination for access to credit, and that provide for pension credit during maternal leave are still lacking.11 Analyses have shown that women face “de facto” constraints in pursuing entrepreneurial activities associated with inadequate business skills, limited access to start-up capital, and pressures to engage in childcare, cooking and other domestic activities that fully occupy their time. Consequently, women own less than a third of active small and medium-sized enterprises (SMEs) nationwide and only 17 percent in rural areas.12 B. Sector Background 7. As a landlocked, service-oriented country, Rwanda considers physical connectivity with neighbors and international markets a necessary condition to meet its development goals. Guided by the Government of Rwanda’s (GoR) 10-year logistics strategy13 and bolstered by opportunities offered by new regional trade agreements, the GoR joined with private partners to develop transport and distribution channels aimed at strengthening strategic trade links to bolster Rwanda’s ability to provide competitive goods and services to the region. Considerable public investment was deployed alongside regulatory reform, leading to improved times for border clearance, greater procedural transparency and predictability, and improved supply chain reliability. 8. Like in many SSA countries, ninety percent of people and freight travel across Rwanda by road. Accordingly, Rwanda desires maximal road connectivity with high-standard national, district, and feeder road networks that meet regional and national sealed bitumen standards. The road network is well established, comprising nearly 38,000 km that includes a high “classified” road density of 62 km per 100 km2.14 Rwanda has also achieved notable success in maintaining the national roads system based on regular rehabilitation. Indeed, following rehabilitation of the Kagitumba-Kayonza- Rusumo road (208 km) in 2019 connecting Kigali to the Uganda and Tanzania borders, the World Bank, under the Lake Victoria Transport Project (LVTP, P160488) and the Japan International Cooperation Agency (JICA) finance the upgrading of the Ngoma-Nyanza corridor (119 km) to the vital international Central Corridor. 9. Road traffic fatalities and injuries are an increasing burden on Rwanda’s health system and the overall economy despite ongoing efforts on road safety. With an estimated 29.7 deaths per 100,000 people per year, Rwanda is classified by the World Health Organization (WHO) among countries in the red zone. Moreover, WHO estimates that only 593 of the 3,535 deaths from road traffic accidents in 2018 were reported.15 The leading causes of accidents include reckless driving, wrong maneuvers, driving over the prescribed speed limits, violation of the vehicle’s right of way, overtaking 9 Netherlands Commission for Environmental Sustainability, Climate Change Profile: Rwanda, 2015. 10 Stockholm Environment Institute, The Economics of Climate Change in Rwanda, 2010. 11 The World Bank, Women, Business, and the Law, 2023. 12 Alliance for Financial Inclusion (AFI), Increasing Women’s Financial Inclusion and Closing Women’s SME Credit Gap in Rwanda Through Enabling Financial Policy Regulation, 2023. 13 Ministry of Trade and Industry, Government of Rwanda, Strategy for Logistics and Distribution Services, 2012-2022, April 24, 2012., 14 According to a recent study done by MININFRA Public Transport Accessibility, there over 45 thousand km of roads. The National Feeder Roads Master Plan, currently under preparation, will provide a more detailed estimations of the total length of the network. 15 World Health Organization, Global Status Report on Road Safety, 2018. 2 maneuvers, and drunk driving. Rwanda’s 2021 Transport Policy and Strategy recommended a lead road safety agency to bolster the current fragmented institutional set-up but that has been hindered by budget constraints. With a range of agencies involved, consolidating data to inform decision-making is difficult. 16 10. The current lack of integrated, multi-modal connectivity constrains deeper formation of regional value chains and hinders Rwanda’s competitiveness as a regional logistics hub. Without greater air cargo capacity or connectivity with the growing regional railway network, Rwanda’s production and trade relies on the all-road Northern and Central Corridors to the Mombasa and Dar es Salaam Sea ports, respectively, for access to international markets. The Central Corridor connects the Port of Dar es Salaam by road, rail, and inland waterways to Burundi, Rwanda, Uganda, Eastern part of the DRC, and all central and northern-western Tanzania. The corridor forms part of the backbone of the regional transportation system in East and Central Africa carrying imports and exports of five countries with a population of more than 120 million people, but lengthy turnaround times and cost volatility associated with trade facilitation are critical constraints to efficient business operators.17 11. Currently air transport is served by one international airport and six aerodromes spread across the country, but a new international airport is under construction in Bugesera. Dense settlement and challenging topography around the Kigali International Airport prevent its further expansion, constraining Rwanda’s efforts to become a transport hub for the region. Accordingly, the GoR initiated construction of a new airport in Bugesera District, 40 km south-east from Kigali, and entered a strategic partnership with Qatar Airways for its construction and operation. Upon completion, planned in 2026, the airport will eventually have an annual capacity of 8.2 million passengers and 150,000 tons of cargo.18 The GoR’s planned Operational Readiness and Airport Transfer for March 2027 covering the new Bugesera International Airport (NBIA) expects the KLPConnect project roads to be completed and operational to support NBIA’s multi-modal operations. 12. The GoR also plans to build railway lines to reduce the current transit times along the Central and Northern corridors, estimated at 419 and 7.5 days,20 respectively. In the case of the critically important Central Corridor, feasibility studies to connect Rwanda with Tanzania and Burundi were completed. The proposed railway line from Isaka to Kigali will have a link to Burundi that would run from Keza to Musongati via Gitega. The Kigali-Isaka railway (about 500 km) will connect Kigali to the Central Railway in Tanzania at the dry port in Isaka, potentially cutting the Kigali-Dar es Salaam transit time by more than half as compared to the all-road system. 13. The GoR’s 2012-2022 Logistics and Distribution Services Strategy also foresaw a range of production and distribution channels, that together play a key role to ease doing business in Rwanda and across the region. Most notably, the Kigali Logistics Platform (KLP) was built from 2016-2019 as a US$35 million multimodal freight and cargo logistics hub to service the region’s trade. The facility was awarded in 2016 as a 35-year Build-Operate-Transfer contract to Dubai Port World (DP World) in which GoR has provided the land to the investor and basic infrastructure to the site, including road and utilities (water and electricity). KLP is a hinterland facility, currently operating on 19 hectares located 17 km from Kigali that feature an inland container terminal with warehousing capacity, a container yard, break-bulk/bulk handling, and storage facilities, and an expanding range of accompanying services such as customs inspections, banking, tax payment, and maintenance. KLP became fully operational only in 2021-2022 due to the impact of the global pandemic. 14. The establishment of the KLP as a concession with a world-class operator represents a key step in Rwanda’s roadmap to be a logistics hub for the East Africa Community. With a throughput that has reached around 100,000 metric tons (MT) per year, 30 percent of which originates at or is destined for international markets, KLP is poised to play a significant role in the regional economy.21 KLP provides, through DP World, bonded and non-bonded warehousing cold 16 MININFRA is responsible for road safety policy; RTDA, the Rwanda Utilities Regulatory Authority (RURA) and local governments are MININFRA’s implementing agencies; and the Rwanda National Police (RNP) enforces road safety laws. 17 The Central Corridor accounts for 80 percent of the country’s overseas trade but takes over 90 hours to reach the port, far e xceeding the 60-hour target, but still half the time along the Northern Corridor. Moreover, though dwelling times at Mombasa port are significantly lower, the additional clearance requirements through Uganda and Rwanda border posts, time and cost of transport make it overall less competitive compared to Dar es Salaam. Fostering Rwanda’s Competitiveness & Resilience in the Post COVID-19 era, The World Bank, 2022. 18 Aviation, Travel and Logistics Agency, MININFRA, Government of Rwanda. 19 Central Corridor Transport Observatory, Annual Report of the Performance of Central Corridor Transit Transport, May 2023. 20 Northern Corridor Transport Observatory, Annual Northern Corridor Transport Observatory Report 2022, May 2023. 21 Statics according to Ministry of Trade and Industry (MINICOM), GoR, 2024 3 storage inland container depot and cargo handling services. DP World is also becoming vertically integrated in the logistics sector as it enters long haul trucking, packaging, and a range of other logistics services. KLP’s growing role in facilitating the growth of Rwanda’s logistics sector provides considerable economic spillovers to the local economy. In addition to the over 450 people employed directly to work at KLP, the platform hosts many service-oriented local firms that engage in clearing, forwarding, banking, third party logistics, and even some cases of fourth party logistics.22 15. Expectation of rising demand for logistics and in preparation for planned rail services near the platform, KLP will soon expand to over twice its size. The Phase 2 expansion will bring the entire KLP to 42.5 hectares and is currently envisaged to take place during 2026-2027. It will include: (i) a commodity processing center to clean, dry, store, and package commodities such as maize and beans in collaboration with the Ministry of Agriculture and East African Exchange; (ii) a goods manufacturing, processing, storage, and distribution area for pharmaceutical products; and (iii) space for Rwanda’s logistics providers to develop and expand their business. In support of KLP’s expansion, GoR is strengthening the physical connectivity of KLP to key road corridors, especially the Central Corridor to facilitate the movement of goods and services to and from the new Bugesera Industrial Park and the NBIA. 16. Currently, KLP is connected to the Central Corridor, but the traffic flow to and from the facility has grown to the point that the conditions at peak hours are fully saturated and totally congested. Rwanda has promoted Special Economic Zones (SEZs) and industrial parks across the country to fosters foreign and domestic investors. While SEZs and industrial parks have been an enabler of productivity and sustainable growth, since 2010,23 the significant growth of concentrated economic activity24 has added to the already severe traffic congestion in the KLP area.25 To avoid the congestion, the trucks come to KLP park at Rugende (approximately 8 km to KLP) during the day to avoid the congestion and proceed only during night hours. To the west and the south of KLP, traffic transiting to and from Eastern DRC and Burundi transit through the City of Kigali, contributing to urban congestion and causing severe risk of traffic accidents (Map 1). At the same time, with the NBIA and the emergence of additional industrial zones the Bugesera area is expected to soon become a leading commercial and industrial center of the country. Better connectivity between KLP and the NBIA is urgently needed as the airport will be completed in 2026. 17. The anticipated emergence of the Bugesera area as a commercial center offers the opportunity to close the gender gap in the international trade and logistics sector and increase female ownership of SMEs. Because of women’s concentration in subsistence agriculture, women do not seem to benefit from the country’s trade expansion as much as men.26 Accordingly, women-owned firms remain underrepresented in the SMEs and represent only 32.7 percent of registered enterprises, of which 62.2 percent are either micro or small.27 One of the barriers for women in Rwanda to form SMEs is a lack of credit for women-owned enterprises, with 38 percent of female-owned SMEs credit constrained compared to 26 percent of men’s. In addition, many of the women entrepreneurs operate in the informal sector and do not have a business plan, which prevents them from expanding their business and access to credit.28 18. Moreover, there is underrepresentation of female employment in Rwanda’s transport sector. Based on data from the International Labor Organization, of the people employed in transport storage and communication, only 7.4 percent are women. Barriers that women face to participate in the public transport sector in Rwanda include gender stereotypes, limited opportunities to put skills to work, few women enrolling into Science, Technology, Engineering, and Mathematics subjects, inadequate gender perspective in social enterprises providing training in the sector, and sexual harassment in the workplace.29 22 A storage and re-packaging operation to provide sugar in smaller 1–2-kilogram packages was established with Illovo, Africa’s largest sugar producer. 23 International Growth Center Analyzing the Impact of the Kigali Special Economic Zone on Firm Behavior, 2017. 24 From 2013 to 2016, the Kigali Special Economic Zone (KSEZ) contributed to approximately 4.5 to 10 percent of the total national goods exports. 25 The reported daily passenger car units (PCU/day) are 12,633 and the number of trucks per day is 1,605 while the same numbers were respectively 8,154 and 625 in 2016. The increase is due to: (i) increased truck traffic to KLP, (ii) increase truck traffic to Rwamagana Industrial Park, and (iii) high pace of residential developments in the town of Kabuga (Gasabo District) and the areas of Muyumbu and Nyagasambu (Rwamagana District). 26 UNCTAD, who is Benefiting from Trade Liberalization in Rwanda? A Gender Perspective, 2014. 27 AFI., Op. cit. 28 Op. cit. 29 Urban Pathways, Improving Training Outcomes and Employability of Women in the Public Transport Industry: Kigali case study , 2023. 4 C. Relevance to Higher Level Objectives 19. The project is linked to the World Bank Group (WBG) vision “To create a world free of poverty on a livab le planet.” The 2019 Systematic Country Diagnostic (SCD) highlighted the importance of an improved transport infrastructure and mobility services for Rwanda’s progress toward poverty reduction and shared prosperity in a sustainable manner. The project is aligned with the Country Partnership Framework (CPF) for Rwanda (2021-2026) (Report No. 148876-RW), discussed by the Board of Directors on July 9, 2020, specifically Objective 3. It concerns WBG support for GoR’s efforts to develop multimodal transport, expand access to infrastructure and the support the digital economy by improving connectivity domestically and regionally. This will reduce the cost of doing business and facilitate trade and thereby help address key constraints that hinder private sector development. The project will also contribute to the WBG Gender Strategy 2024 – 2030, to “accelerate gender equality for a sustainable, resilient, and inclusive future” as it will ensure open access of gender to sustainable infrastructures. The project will complement current and planned World Bank-financed and donor-financed interventions in the country, particularly, the LVTP, the Feeder Roads Development Project (FRDP, P126498), and the proposed Rwanda Emergency Connectivity Restoration Project (RECOR, P504023). 30 20. The project is highly relevant to the strategic objective of Rwanda’s own policies and frameworks to reduce transport constraints and promote growth and economic development. With access to domestic and international markets representing a key policy priority for the GoR, the economic transformation pillar of the 2017-2024 National Strategy for Transformation-1 includes a strategic plan for the transport sector, underscoring the pivotal role of infrastructure development. The Transport Sector Strategic Plan seeks an expanded and modernized transport infrastructure with four priority objectives: (i) improved riding quality and level of service across the road network, (ii) improved public transport services to reduce urban traffic congestion, (iii) promotion of an integrated multimodal transport system, and (iv) support for an efficient and sustainable air transport system. 21. The project is consistent with the Rwanda’s Nationally Determined Contribution (NDC),31 its Revised Green Growth and Climate Resilience Strategy (GGCRS),32 and its Country Climate and Development Report (CCDR).33 Rwanda’s NDC identified adaptation interventions by sector, including the deployment of improved transport infrastructure and services, with the reduction of length of roads vulnerable to flood and landslides and the installation of solar lighting and light-emitting diode (LED) systems for street lighting and public spaces along main roads; the development of climate resilient post-harvest and value addition facilities; and the promotion of afforestation /reforestation activities. The revised GGCRS sets out the country’s vision for 2050 and defines a program of action for low carbon, climate resilient energy and transport networks, which includes the deployment of resource-efficient infrastructure to drive green trade growth, powered by low-carbon and climate-resilient energy and transport systems. Rwanda’s CCDR identified as key priority areas investing in affordable post-harvest and storage solutions, reforestation and terracing on slopes to prevent soil erosion. The project will contribute to adaptation and mitigation objectives through integrating climate information in transport and market infrastructure planning, adopting climate informed design and constructions standards for the rehabilitation and upgrading of markets, roads, bridges, and ancillary infrastructure, and providing regular maintenance of infrastructures. The project also promotes planting trees to combat land degradation, erosion, and landslides. 30 LVTP is paving the road section of Kibugabuga-Shinga-Gasoro (66.55 km.) (part of the central corridor) that is connecting to the KLP roads in Bugesera district. FRDP is contributing by rehabilitating feeder roads that are connected to main roads and serving as channels for access to markets and transfer agriculture products. RECOR is being developed in response to floodings which occurred on May 3, 4, 2023 by rehabilitating and repairing damaged roads and bridges while making sure they are resilient. 31 Republic of Rwanda, Updated Nationally Determined Contribution, May 2022. 32 Republic of Rwanda, Revised Green Growth and Climate Resilience: National Strategy for Climate Change and Low Carbon Developme nt, 2022. 33 World Bank Group, Country Climate Development Report: Rwanda , September 2022. 5 II. PROJECT DESCRIPTION A. Project Development Objective 22. The Project Development Objective (PDO) is to improve resilient and safe connectivity from the Kigali Logistics Platform (KLP) at Masaka to the regional logistics corridors and support local and regional economic activity around the corridors. 23. The project will provide key physical links in the national transport system and support a new KLP-Bugesera regional logistics corridor to enable increased trade by all levels of market participants. Specifically, the project will expand the region’s logistics lines by linking the KLP located at Masaka/Kigali with the Ngoma-Nyanza Road (itself connected at Ngoma to the regional Central Corridor) using high standard paved roads and contributing 16 percent (70 km) to the GoR’s sector objective of upgrading 440 km of unpaved national roads to paved status. Map 1 – Spatial Depiction of KLP Connect Project34 24. Upgrading KLP/Bugesera Connector Roads will be a key step in connecting the landlocked countries of the EAC with seaports and airports distribution of goods to and from external markets. It complements the ongoing LVTP and FRDP and promotes climate-friendly activities. The project will contribute to (i) safer and cost-effective transit of goods from the Port of Dar es Salaam to Rwanda, Burundi, and Eastern DRC,35 (ii) significantly reduced truck congestion in Kigali, (iii) better connected existing and new commercial zones and parks with logistics platforms,36 and (iv) deepened multi- 34 Map cleared by Map Unit on March 5, 2024. Map number 47616. 35 The road sections are currently in a very deteriorated state and remain an obstacle to achieving a smooth and safe movement of goods and people along the logistics corridor. 36 The planned Bugesera industrial park, on National Road (NR) 5 between Ramiro and Kibugabuga will support Bugesera’s agricultu ral and tourism potential. 6 modal logistics integration by improving road connectivity between the KLP and the future Bugesera Airport and linking with the future railway. 25. In addition, the implementation of KLPConnect will enable truck traffic to utilize the Ngoma-Nyanza corridor and connect to KLP without passing through either Kayonza (part of NR4) or Kicukiro (part of NR5). This will: (i) mitigate transport delays for trucks, (ii) alleviate congestion for city-bound traffic, and (iii) reduce the risk of traffic accidents. Once completed, the project roads will accommodate traffic heading to KLP from the eastern, southern, and western parts of the country, including the generated traffic from NBIA to KLP, thereby significantly enhancing road connectivity to both KLP and NBIA. Consequently, this will critically alleviate congestion within the City of Kigali and improve road safety overall. 26. The project will also support inclusive participation of local production that will grow along the logistical corridor. In addition to strengthening the GoR’s capacity to manage and oversee the development of regionally based trade, logistics, and distribution systems the project will support SME and local community participation in economic activities around the project roads. Complementary investment in socio-economic infrastructure along these roads will help ensure that local communities including women, youth, and SMEs benefit from new employment and livelihood opportunities. This includes support for one or two of the planned industrial parks in the Bugesera, Kicukiro and Rwamagana districts, as well as funds to support markets and selling points in selected villages. During implementation, the project will identify specific interventions that address the needs of SMEs along the roads and enhance participation of women and young people to allow them to benefit from the project. 27. The following PDO level indicators are selected to measure progress towards achieving the PDO: • Travel time from KLP to Ngoma-Nyanza highway (number of hours). (Hours) (hours) • Percentage of people with enhanced access to reliable transport infrastructure and services all year round37 in the project area (disaggregated by gender) • Number of health centers, schools, and markets with improved access in the project area • Number of (newly)38 registered businesses established in the project area (disaggregated by gender). • Reinforced/upgraded critical structures (bridges, culverts, embankments) raised along the road sections to respond to increased vulnerability due to climate change effects (number). B. Project Components 28. Component 1: Improving physical infrastructure (US$105.44 million, comprising US$91.49 million IDA and US$13.95 million GoR funding). The component will finance the design, upgrading, and performance-based maintenance of the KLP/Bugesera connector roads and the environmental and social risk management activities. 29. Subcomponent 1.1: Upgrading of the KLP/Bugesera connector roads (US$91.44 million, comprising US$77.49 million IDA and US$13.95 million GoR funding). The upgrading of the KLP/Bugesera connector roads (69.45 km) will comprise: (a) design, preparation of bidding documents, upgrading to paved standard, and three-year output and performance-based maintenance of four road sections, namely, (i) Masaka-Kabukuba (16.88 km), (ii) Kabukuba-Nyamata (13.72 km), (iii) Gahembe-Kindama (19.21 km); and (iv) Kabukuba – Riziyeri (19.64 km). The client will take over the maintenance following IDA financing closure from IDA for maintenance based on a scale-up effort from the country providing matching counterpart financing;39 (US$87.57 million, comprising US$74.21 million IDA and US$13.36 million GoR funding), and (b) consultant services for supervision and monitoring of civil works (US$3.87 million, comprising US$3.28 million IDA and US$0.59 million GoR funding). For any planned upgrading or provision of utilities (e.g., water, electricity, fiber optic cable), the project will provide appropriate space (land) within the right of way (RoW). The provisioned RoW will allow the supply of such utilities and expand the road in case of need without damaging the existing road or requesting 37 Roads accessible year-round refers to the project roads designed and upgraded with mitigation and adaption measures to make them resilient to climate change. Such actions have been described in paragraph 56 to 61. Bridges, culverts, road crossing structures have been planned to respond to the effect of climate change with increase of water flow. 38 Newly refers to all businesses created after the project starts and considered as an inductive effect of the project. 39 The assumption is that the six years of the project implementation will be split in three years for implementing the upgrading the 69.45 km, and three years for maintenance. At the closing of the project, the maintenance will be taken over by the client. 7 compensation.40 The upgrading of the roads includes approaches for green and resilient construction, including erosion prevention works, water drainage through adequate channels, reduction of water speed, and protection of road embankments. Safer speed and vulnerable road users’ safety will be ensured through safety conscious road design and results of road safety audit at various stages. 30. Subcomponent 1.2: Environmental and social risk management (US$14.00 million from IDA funds). This subcomponent will finance: (a) resettlement of the project-affected persons (PAPs) along the road sections and the planned roadside infrastructure (US$8.00 million); (b) community and stakeholders' engagement including establishing and operating the grievance redress committees, including electronic grievance redress mechanism (e-GRM) (US$0.5 million); (c) roadside investments and capacity building for livelihood restoration of communities living along the roads (US$3.00 million); (d) comprehensive road safety measures (speed management and vulnerable road users safety, campaigns and trainings for school children and road users supported by enforcement, surveys, personal protection equipment) together with a road safety capacity review including preparation of transport safety policy and strategy, road safety audits, Key Performance Indicator (KPI) assessments, and a comprehensive road safety agenda to reduce fatalities and injuries, as initiated under the LVTP and FRDP road projects (US$2.00 million); and (e) environmental protection activities (US$0.5 million) including: (i) roadside planting and management of 7,000 trees adaptable to the area along the 69.45 km road within 10 meters distance of upgraded road sections, and (ii) buffer zone establishment and management for Lake Kidogo and marshlands (Rugende, Akagera). 31. Component 2: Trade facilitation and logistics improvement (US$26.51 million, financed by IDA). Activities under this component will be carried out by the Ministry of Trade and Industry (MINICOM). 32. Subcomponent 2.1: Basic infrastructure for women, youth, and SMEs along the corridor (US$17.31 million from IDA funds). The subcomponent will finance activities to help residents of the local communities of the three districts along the road - Bugesera, Kicukirro, and Rwamagana - and SMEs operating in the project area to economically benefit from the upgraded road sections. Such activities will comprise: (a) a community-driven demand analysis and prioritization, selection, design, construction/upgrading, and related supervision of works for upgrading/construction of the socio- economic infrastructure, including an analysis of gender differences in mobility to identify the location of markets that can address women’s priorities in terms of safety and time use (US$1.50 million), (b) design, construction, and supervision of development of basic infrastructure and facilities of at least one SME/industrial park that will be selected (US$9.81 million) among those in the vicinity of the project area based on potential impacts,41 (c) design, upgrading/constructing of two roadside markets, selected based on technical studies and local consultations (US$4.00 million), (d) design, upgrading/constructing of four selling points in the selected villages/sectors along the roads (Musenyi, Mareba, Nyamata, Rilima, etc.) to be confirmed based on technical studies and local consultations (US$1.00 million), and (e) design and setting up an SME-oriented warehouse and e-commerce hub (with precise design to be discussed with logistics providers and potential beneficiaries) (US$1.00 million).42 33. The project would provide Private Capital Enabling (PCE) with the infrastructure to be built under subcomponent 2.1. Once the SME/industrial park, roadside market selling points, and the warehouse and e-commerce hub are built or upgraded, it is expected that businesses will make initial investments estimated by MINICOM to be around US$40 million to take advantage of this new infrastructure.43 40 Street lighting will be part of the road works in case of needs. In addition, once the construction under the project is completed, the roads will be integrated into an ongoing comprehensive utility development project in the area to complement the existing utility infrastructures to enhance the overall economic conditions alongside and around the road corridor. 41 Interventions related to the development or expansion of industrial parks will consider the International Framework for Eco-Industrial Parks developed by the World Bank and other partners. The framework encourages parks to be designed such that industrial activities are integrated with environmental sustainability to minimize resource consumption, reduce pollution, and promote circular economy principals. Two examples of projects that included eco-industrial park policies are the Bangladesh Private Investment and Digital Entrepreneurship Project (P170688) and the Jiangxi Eco-industrial Parks Project (P158079). 42 The center is envisioned to offer IT services, digital marketing services, warehousing, fulfillment and transportation services, and training (including efforts to integrate the Customs Declaration System of Iposita and RRA Single Window System). 43 The project will undertake business baseline and updated surveys to obtain and monitor, at regular intervals, gender disaggregated and location specific information on investment, trade, and provision of services. 8 34. Subcomponent 2.2: Improved quality and standards of goods and services (US$5.2 million from IDA funds). The activities comprise: (a) upgrading national testing, calibration, and verification laboratories to ensure safety of goods in warehouses/transit, accurate measurement in road construction and maintenance by providing accreditation services, mapping and validation, calibration of warehouses, cold rooms, deep freezers, and truck coolers, warehouses weighing scales and weighbridges, and axle load control weighbridges, calibration of force, coordinates, temperature and dimensional equipment of construction site quality control laboratories (US$4.2 million); (b) assisting SMEs, especially those located along the corridor, to meet international quality standards for their products and services (US$0.80 million); and (c) strengthening Rwanda Standards Board’s (RSB) outreach services and provision of mobile laboratories and testing kits at border posts, airports, and logistics platforms (US$0.20 million) 35. Subcomponent 2.3: Institutional support and strengthening MINICOM, RSB, and the Rwanda Development Board (RDB) capacity building (US$4 million from IDA funds). Rwanda’s aspirations to be a regional trade center and EAC logistics hub require MINICOM to upgrade its capacity to lead strategy development, provide system oversight, and carry out project management, particularly in the areas of private sector partnerships and public agency coordination. The subcomponent will support MINICOM, RSB, RDB, producers and traders with an emphasis on women through: (a) updating the 2012-2022 Logistics and Distribution Services Strategy to help Rwanda realize its vision and updating phase II Kigali Logistics Platform feasibility study, including ways the KLP expansion can help expanded regional trade through multi- modal connectivity, and accommodation for the nation’s growing logistics providers (US$1.50 million); (b) capacity building of MINICOM44 and RDB staff to (i) develop, solicit, negotiate, and manage public-private partnerships for the sector, (ii) carry out risk-based system oversight and calibration to maintain performance standards, (iii) provide real time regulatory, logistical, and process-oriented information and capacity building for traders and SMEs with emphasis on building capacity of women to participate in the trade and small business sectors (such as training in business advisory services, personal initiative and access to finance), and (iv) undertake project management45, procurement, financial management and environmental and social risks management (US$2.00 million); and (c) carry out an assessment of barriers for women entrepreneurship (US$0.50 million). MINICOM’s Single Project Implementation Unit (SPIU) operational costs and salaries will also be supported. MINICOM SPIU’s staffing is composed of the SPIU Coordinator, Financial Management Specialist, Procurement Specialist, E-Commerce Specialist, Trade Specialist, Civil Engineer, Environment Specialist, Social Specialist, and Gender Specialist. SPIU Coordinator, Financial Management Specialist, M&E Specialist, Procurement Specialist, E-Commerce Specialist, Trade Specialist, Civil Engineer, environment specialist, social specialist, gender specialist, and (US$1.00 million). 36. Component 3: Implementation support, monitoring, and capacity building (US$7 million, financed by IDA). The component will finance the following activities to support implementation of the project and enhance the capacity of line ministries and engineering interns employed in the RTDA. 37. Subcomponent 3.1: Project management and operating costs (US$3 million from IDA funds). This subcomponent will finance project management through supporting project implementation units in undertaking, among others, procurement, financial management, environmental and social risks management, and establishment and operation of grievance mechanism. 38. Subcomponent 3.2: Monitoring and evaluation (US$0.5 million from IDA funds). This subcomponent will finance the monitoring and evaluation, including undertaking any assessments, survey, and other studies required under the project. The subcomponent will undertake an assessment early in the project life to identity, clarify, and quantify specific activities subject to private capital investment. It will also undertake as early as possible an SME baseline survey, to avail baseline data for the project implementation and results measurement. The baseline survey will provide SME investment information, SME access to finance status, and the potential provision of new services (including logistics providers). The studies will provide priority actions to attract private sector in the project zone. 44 Capacity building for MINICOM concerns the SPIU, RSB, and the participating directorates of the ministry to the project. 45project management costs include cost to support MINICOM SPIU (and other Ministry staff involved in the project) to implement the KLPConnect (Operational costs and salary for 10 SPIU staff working on the project).: 9 39. Subcomponent 3.3: Institutional support and capacity building for Road Transport Development Agency (RTDA), MININFRA, and Ministry of Finance and Economic Planning (MINECOFIN) (US$3.50 million from IDA funds). This subcomponent will finance: (a) capacity building of staff from the SPIU RTDA and recently graduated intern engineers (of which half being women), staff of MININFRA and MINECOFIN involved in project implementation, (b) studies for development of future operations, (c) carrying out feasibility study for a center for excellence in material testing under RTDA, and (d) the transport sector coordination activities at MININFRA. 40. Component 4: Contingent Emergency Response (CERC) (US$0 million). This zero-dollar component can be activated to provide support for an immediate response to an eligible crisis or emergency as needed. A CERC Manual and an Emergency Action Plan will have to be prepared separately and approved by the World Bank, which will constitute a disbursement condition for the CERC. If this component is activated, the project will be restructured to reallocate funds, and to revise the PDO, indicators, and implementation arrangements as needed. Table 1: Summary of Project Estimated Costs and Financing (US$ million) Project Component Total IDA Counterpart Component 1: Improving Physical Infrastructure 105.44 91.49 13.95 1.1: Upgrading of the KLP/Bugesera Connector Roads 91.44 77.49 13.95 1.2: Environmental, Social Risk Management 14.00 14.00 0.00 Component 2: Trade Facilitation and Logistics Improvement 26.51 26.51 0.00 2.1: Basic Infrastructure for Women, Youth and SMEs along the Corridor 17.31 17.31 0.00 2.2: Improved Quality and Standards of Goods and Services 5.20 5.20 0.00 2.3: Institutional Support and Strengthening MINICOM, RSB, and RDB capacity 4.00 4.00 0.00 building Component 3: Implementation Support, Monitoring, and Capacity Building 7.00 7.00 0.00 3.1: Project Management and Operating Costs 3.00 3.00 0.00 3.2: Monitoring and Evaluation 0.50 0.50 0.00 3.3: Institutional support and capacity building for RTDA, MININFRA, and 3.50 3.50 0.00 MINECOFIN Component 4 Contingent Emergency Response Component (CERC) 0.00 0.00 0.00 Contingencies 1.00 1.00 0.00 Total 139.95 126.00 13.95 41. Partnership and collaboration. There is proactive coordination with other development partners in Rwanda. The project will help build synergies with the existing road upgrading project from Ngoma to Nyanza which is co-financed by JICA and the World Bank. The Asian Infrastructure Investment Bank has also expressed interest in supporting the project which will be further discussed during project implementation. C. Project Beneficiaries 42. The project covers three districts – Kicukiro in Kigali City and Rwamagana and Bugesera in the Eastern Province – which share similarities in terms of the trade and transport patterns as well as socio-economic profile. The beneficiaries mainly include farmers, owners of various agriculture schemes, local communities, and SMEs along the road corridors in the project area. The project is expected to create job opportunities during the construction period, some of which will continue during maintenance. Upgrading of the road sections under the project will trigger increased movement 10 of goods and passengers between the Kigali Logistics Platform and the Bugesera Industrial zone increasing production and benefiting logistics providers in Rwanda. The project is expected to reach 1.5 million beneficiaries (about 60% of districts population) including youth and nearly 50 percent women. Other project beneficiaries will include the public institutions and their staff not involved in trade facilitation, road construction such as MINECOFIN, MINICOM, MININFRA, RTDA, RSB, and RDB. 43. Improving access to markets and socio-economic services and facilitating freight and passenger movement across the project area and to neighboring countries are the primary benefits of the project. The project will help create short-term as well as long-term employment opportunities and attract new complementary developments and investments. Given that the project is also expected to contribute to the share of all-weather roads in the area and in view of the proximity to Burundi, the population from targeted districts will access new markets. Figure 1: Theory of Change D. Results Chain 44. The Theory of Change shows the intervention logic and results chain that will lead to realization of the PDO (Figure 1). The anticipated outcomes of project activities are: (i) reduced travel time traveling from KLP to the Ngoma- Nyanaza highway, (ii) improved multi-modal connectivity, (iii) improved road safety, (iv) enhanced climate resilience of road infrastructure, (v) improved livelihood conditions of people in the project area, (vii) faster movement of goods and services being handled through the KLP, and (viii) increased number of registered businesses, disaggregated by gender. E. Rationale for Bank Involvement and Role of Partners 11 45. The project complements ongoing World Bank-financed projects and other donor-funded interventions in the country. The project provides an alternative46 and direct connection between the Ngoma-Nyanza Corridor and KLP without passing through Kigali City and ensures continuity of the traffic between KLP and the three borders of Rusumo with Tanzania, Nemba with Burundi, and Rusizi and Goma with DRC. The road sections under the project will also provide a direct connection from the KLP facility to the New Bugesera International Airport under construction, facilitating the movement of people and goods for both import and export to and from the neighboring countries. 46. Rwanda has generally been successful at strategically deploying public investment to attract and enable partnerships with private sector capital and the trade and logistics sector . World-class private investment, attracted by the commercial returns of emerging logistics platforms has been deployed at KLP and Bugesera airport with the public sector facilitating the partnership through regulation, land availability, and basic infrastructure (roads, water, electricity). The connector road that requires upgrading under the project is deemed an integral part of the public sector’s contribution to the emerging logistics corridor given the level of traffic along with the climate adaptation, environmental protection, and social development objectives that also need to be served. F. Lessons Learned and Reflected in the Project Design 47. IDA-financed resettlement costs. The lack of adequate counterpart funding to cover resettlement costs has caused delays in the implementation of two ongoing projects, the LVTP and the FRDP. The recipient has faced persistent challenges in mobilizing counterpart funding due to the GoR’s constrained fiscal resources considering the current financial demands and external factors affecting Rwanda (the COVID-19 pandemic, floodings and landslides, pan-African food insecurity). KLPConnect will allocate IDA funds to cover compensation payments to project-affected persons (PAPs) and other related costs for implementation of the Resettlement Action Plans (RAP) to avoid delays in making land available for roadworks. 48. Design, Build and Maintain (DBM) roads, following the Output- and Performance-Based Road Contracting (OPBRC) approach. The lessons learned from the two IDA-funded projects, LVTP and FRDP, demonstrate that the OPBRC approach offers significant time savings by avoiding the recruitment of design consultants and preparation of the detailed designs prior to the construction of civil works. These time savings are also attributed to early contractor involvement, allowing construction engineering considerations to be integrated into the design offered by the contractor. Beyond time efficiency, this approach is expected to result in fewer claims and disputes, as risks associated with output and performance-based lump-sum contracts are shifted to the contractor. Furthermore, an improved quality of work is anticipated, as the contractor who designed and constructed the road will be responsible for its multi-year maintenance. 49. The contractor's design will undergo review and approval by the employer through the monitoring and supervision consultant. A key lesson is that future projects should provide explicit and detailed technical specifications at the time of bidding so that all bidders bid on a level playing field with minimum chance of drastic changes in the final detailed designs presented by the selected contractor. The maintenance phase is the final stage of the OPBRC approach, offering an inherent incentive to the contractor to deliver a higher quality initial construction to minimize the future maintenance expenditure. This is achieved by establishing lifecycle responsibility and accountability for the facility's performance on the part of the contractor. III. IMPLEMENTATION ARRANGEMENTS A. Institutional and Implementation Arrangements 50. The project’s institutional arrangements consist of a Steering Committee (SC), two PIUs under their respective parent ministries, and execution agencies inside the line ministries. The organizational chart is provided in Annex 1. -The direct involved institutions are MININFRA, MINICOM, RTDA, and the Road Maintenance Fund. MININFRA (through RTDA) will have an overall responsibility for project coordination and implementation, and MINICOM and MININFRA will be responsible for implementation responsibility for the respective project components. MINECOFIN will offer guidance and 46 Trucks currently use National Road 5 Kigali-Kibugabuga (60 km) but will gain time and lower cost by using the Kigali-Riziyeri-Ramiro (36 km). 12 leadership on the utilization of the project’s counterpart funds. Other entities involved are the Rwanda Standard Board, the Rwanda Environment Management Authority (REMA), RDB, and the beneficiaries’ districts. 51. The SC, chaired by MININFRA and MINICOM, will oversee project implementation. The SC comprises the Permanent Secretaries (PS) of MININFRA and MINICOM, MINECOFIN, the Director General (DG) of RTDA, and will convene bi-annually. The SC will make directional decisions on various project implementation aspects. Under the coordination of the MININFRA, the overall project coordination will be led by the SPIU within RTDA. RTDA SPIU will serve as the direct interlocutor with the World Bank for compiled reports on project progress during the implementation and will report quarterly on project progress. 52. The project will have two implementing agencies (IAs): the SPIUs of RTDA and MINICOM. Thus, two special accounts will be set up, one for each IA. Each SPIU will handle technical matters, procurement, financial management, and environment and social issues for their respective activities and components. The capacity of the SPIUs and the ministries’ technical departments to implement project activities will be reinforced by additional staff to be recruited as needed. MINICOM SPIU will be established no later than 60 days after effectiveness. RTDA and MINICOM will each designate a team for project implementation, with designated staff and their expertise to be communicated in writing to the World Bank. Both teams will be maintained during project implementation phase to ensure consistency, continuity, and efficiency in project management. The institutional role of each stakeholder is described in Annex 1. B. Results Monitoring and Evaluation Arrangements 53. Achievement of project objectives, as measured by the corresponding key performance indicators, will be monitored, and reported upon regularly. The monitoring and evaluation (M&E) system will capture information to assess project results against the targets set as part of the Results Framework. The baseline information has been drawn from the feasibility study undertaken during project preparation and will be followed up with beneficiary surveys and other assessments at the midterm review (MTR) and at closing to evaluate qualitative and quantitative aspects of project results. Progress of the key performance indicators will be measured through the implementation support missions and some specific surveys. Specific details for project management and reporting will be laid out in the Project Implementation Manual (PIM) that will serve as the overall guiding document for the SPIUs. The PIM will be prepared and adopted by the recipient by effectiveness. The recipient will carry out an MTR three years into implementation. The target indicators will be provided before the start of the activity impacting them. C. Sustainability 54. KLPConnect is expected to address sustainability of the infrastructure investments and trade facilitation measures through enhanced ownership of the participating administration. The road upgrading will be implemented through a DBM arrangement to ensure that maintenance of the investment is guaranteed for the initial three years after completion of the upgrading works. After closing, the GoR will take over maintenance through the Road Maintenance Fund (RMF). The RMF will ensure sustainability of long-term maintenance, and enforcement of axle load control by RTDA along the corridor will help preserve the road asset. The GoR has managed to keep the national paved road assets at an acceptable riding standard since creation of RTDA in 2010 using the RMF as core financing source for maintenance. Annual assessment of the riding quality is conducted with the use of roughness meters and bump integrators, and reports are shared with the development partners via annual Transport Sector Working Group sessions. IV. PROJECT APPRAISAL SUMMARY A. Technical, Economic and Financial Analysis Technical Analysis 55. The road sections connecting KLP to the Nyanza–Ngoma corridor are at present narrow gravel roads (6 meter wide with no shoulders) in poor condition, with high vehicle operation costs for road users. Travel times are long, especially during heavy rains, causing severe congestion on alternative routes through Kigali. The upgrading of these road sections will involve widening the carriageway to 7 meters with 1.5-meter shoulders and pavement consisting of 13 improved subgrade, 150-300 mm of gravel sub-base, 150-200 mm of granular base course, and 100 mm of asphalt concrete surfacing. The chosen design was based on the 20-year projected traffic loading after construction and optimizing lifecycle costs over an analysis period of 22 years including the 2-year construction period. Such upgrading would provide all-year access to the Nyanza–Ngoma highway and the East African Central Corridor, reduce transport costs and travel times, and decongest traffic in Kigali and alternate routes to the Central Corridor, DRC, and Burundi. Economic Analysis 56. The project is expected to generate considerable economic benefits. The project leverages the ongoing impact of the LVTP to unleash the economic potential of connecting KLP to the Central and Regional Transport Corridors and the region’s logistics centers. The principal benefits will be felt by road users and by direct and indirect participants in the country’s commercial sector by increasing the role of private sector and deepening regional integration, which are key success factors to the achievement of the GoR’s Vision 2050 development objectives. The benefits will include: (i) decreased travel times along the road corridors, (ii) reduced vehicle operating costs, and (iii) reduced environmental and maintenance costs in the long run. Economic benefits are also expected from the expanded use of the logistics platform. 57. The project is also expected to provide social and environmental benefits. Social benefits will come from the improved socio-economic infrastructure in the project area ensuring that the gains from the project are equitably distributed across income groups and gender dimensions. Expected environmental benefits include improving the road sections with climate resilient infrastructure and reducing net CO2 emissions per vehicle with better vehicle conditions and smoother traffic flows. Trading activities and commercial businesses are expected to prosper. 58. The initial economic analysis of the benefits of the project was conducted in a feasibility study undertaken in 2021.47 The World Bank’s Highway Development and Management (HDM)-4 model was used to conduct the economic analysis using a planning discount rate of 12 percent.48 HDM-4 simulates the 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 savings in vehicle operating costs, travel time costs, road maintenance costs, economic costs of road crashes (accidents), and reduction in environmental effects in terms of CO2 and other GHG emissions. Two alternative routes for connecting the KLP to the Central Corridor through the Nyanza – Ngoma highway were evaluated, comprising the following: (a) Route 1: Masaka–Kabukuba–Riziyeri (36.52 km); and (b) Route 2: Masaka–Kabukuba–Nyamata–Gahembe–Kindama (49.81 km). The section from Masaka to Kabukuba is common to both routes. 59. The feasibility study estimated that both routes have positive Net Present Value (NPV) and are economically viable. Route 2’s higher ratio of NPV/Capital Cost supports a prioritization within the government plan to upgrade both routes. Hence the project comprises upgrading of two distinct unpaved road sections, namely, Masaka–Kabukuba– Riziyeri; and Kabukuba–Nyamata plus Gahembe–Kindama after excluding the two existing paved road sub-sections of the National Highway NR5 that were part of the two routes evaluated in the feasibility study. 60. The main costs associated with the road sections under consideration are the investment costs and the routine and periodic maintenance costs over the 22-year analysis period for each section “with” and “without” project. The “without-project” alternative assumes that the road sections will continue as gravel roads in their present state with minimum maintenance during the evaluation period comprising routine maintenance, spot gravelling, annual grading of the surface, and re-gravelling the surface to 150 millimeters (mm) whenever the surface reduces to less than 50 mm, but not more often than once in eight years. The “with-project” alternative is the upgrading of the road sections to paved standards with an asphalt concrete surface of 100 mm. A standard conversion factor (SCF) of 0.88 is used to convert financial costs of construction, vehicle operation, and maintenance to economic costs, taking into account distortions in market prices due to taxes, subsidies, and scarcity of skilled labor and foreign exchange. 47 Egis Consultants and Eco Design Ltd.: Feasibility for Upgrading of the KLP Connector Project, Volume 1, Main Report, Version 2, July 2021. 48 The HDM-4 model was used to evaluate the specific investments under the project in upgrading only the selected road sections using the basic data from the 2021 feasibility study updated with some modifications in traffic growth rates and maintenance policies. 14 61. The quantifiable benefits include the reduction in vehicle operating costs, savings in travel time costs for passengers and freight, and the reduction in annual maintenance costs. The cost reduction is automatically computed by the HDM-4 model to calculate the overall net benefits discounted at the specified discount rate. Reduction (or increase as sometimes the case may be) in road crashes is also normally considered when accountable in monetary terms, but because of the lack of precise data on crashes in Rwanda, this has not been included in the analysis. Economic Evaluation and Sensitivity Analysis 62. Based on the above, the HDM-4 model was run for all the selected road sections simulating the traffic over a period of 22 years from 2024 to 2045 where the construction period is taken as two years. The discount rate used is 12 percent per year, and a sensitivity analysis of the results was carried out with 20 percent increase in capital costs; 20 percent decrease in traffic growth rates; and the combined risk of a 20 percent increase in capital costs and simultaneous decrease of 20 percent in traffic growth rates. The results are summarized in Table 2 below. Table 2. Summary of Results of the Economic Evaluation Parameter NPV @ 12% EIRR (%) B/C Ratio Base Case (upgrading to an AC road) 20.90 17.7 1.5 20 percent increase in construction costs 12.54 15.0 1.2 20 precent increase in traffic growth rates 12.99 15.8 1.3 20 percent increase in construction costs plus 4.64 13.2 1.1 20 percent decrease in traffic growth rates 63. The results demonstrate that the project is economically viable. The NPV is greater than zero at 12 percent discount rate (US$20.90 million), the Economic Internal Rate of Return (EIRR) is 17.7 percent, and the Benefit/Cost ratio is 1.5. The project remains viable even when the construction costs increase by 20 percent, or the traffic growth rates decrease by 20 percent. When both risks are combined, the NPV is still positive (US$4.64 million), the EIRR is 13.2 percent, and the Benefit/Cost ratio is 1.1. In addition, it should be noted that because of the lack of precise data, the analysis did not consider the traffic that would likely be diverted to the improved road corridors from other congested road sections into and out of Kigali. The benefits of diverted traffic would increase the NPV estimates, emphasizing a robust finding that the project is economic viable. Green House Gases (GHG) 64. The HDM-4 model also calculates the quantities of the GHGs emitted during the analysis period under the with- and without-project options. The results summarized in Table 3 below, indicate that despite the addition of generated traffic (40 percent of the current traffic) due to developmental impact of the improved roads in Bugesera District, there is a net reduction in almost all the GHG emissions, except Hydrocarbon, Carbon Monoxide, and Lead (Table 4). The overall net reduction of CO2 emissions over the design life of the project roads is estimated as 11,689.9 tons. When valued at the recommended shadow price of US$43.7 or US$87.4 per ton (low and high estimates, respectively)49, increasing at the rate of 2.25 percent per year, and using the 12 percent discount rate, the overall net benefit of the total reduction due to the project amounts to US$0.14 million (low estimate) and US$0.28 million (high estimate). Table 3. Economic Indicators with cost of GHG Emissions Hydro- Carbon Nitrous Carbon Sulphur Particulates Lead Road Section carbon monoxide oxide dioxide dioxide Masaka - Kabukuba -Riziyeri Without Project 746.57 1,426.62 1,698.32 82.48 122,981.89 327.06 3.59 With Project 785.51 1,717.93 1,520.86 71.55 113,722.68 286.39 4.11 49 The World Bank, Guidance Note on Shadow Price of Carbon in Economic Analysis, November 12, 2017. 15 Kabukuba - Nyamata -Kindama Without Project 480.36 1,175.48 933.54 38.06 87,107.64 159.21 5.72 With Project 554.05 1,490.83 897.14 34.62 84,727.95 146.53 6.04 Project Grand Total Without Project 1,226.93 2,602.10 2,631.86 120.54 210,089.53 486.27 9.31 With Project 1,339.56 3,208.76 2,418.00 106.17 198,450.63 432.92 10.15 Net Emissions with Project (112.63) (606.66) 213.86 14.37 11,638.90 53.35 (0.84) Present Value (Low Shadow Price) US$ 139,256 Present Value (High Shadow Price) US$ 278,512 Other Benefits of the Project 65. Non-tangible benefits were not included in the HDM-4 analysis as their relationship to transport investments is not documented. Some of these benefits are presented below. The upgrading and improvement of the project roads along with the complementary investments in the socio-economic infrastructure will enhance the local economies of the project area, particularly Bugesera District. Additional benefits are expected to be derived, including: • Employment Opportunities: Earnings from construction works will contribute towards poverty reduction in the affected areas through increased disposable incomes realized from employment of skilled and unskilled local labor. The cadre of jobs likely to be created includes technicians, artisans/skilled labor; drivers; watchmen; laborers; and office assistants. • Local Purchases: Spending by the road contractor(s) as well as road users on purchase of supplies (consumables and road construction materials, e.g., gravel etc.) and land for site offices and accommodation is expected to inject money into the local economies. Gravel is expected to be sourced locally for the road construction hence injecting millions of francs into the local economy during the construction period. • Increased Land and Property Values: The improved road has the potential of enhancing values of land and property in the areas adjoining the road. The benefits will include value addition to commercial and economic activities, potential for institutional development and attraction for residential housing development. • Improved Access to Essential Services: The community will be able to access essential services including, amongst others, health, security, education, markets, government services, and other social amenities whereby the project roads will provide essential links to these services. • Improved Security and Living Standards: Completion of the roads projects will ease the security patrols, hence lowering crime rates in the area. The improved access as already highlighted will open the areas for investments and in the process, improve the living standards of people within the project area. • Higher Farmgate Prices for Agricultural Produce. Bugesera District is rich in agriculture. Since the transport industry in Rwanda is reasonably competitive, the reduction in transport costs is likely to lead to the passing on of some of the savings to the local farmers through higher farmgate prices. 66. The project is aligned with the goals of the Paris Agreement on both adaptation and mitigation. The project is consistent with the country’s NDC, revised GGCRS, and CCDR, as documented in the section on Relevance to Higher Level Objectives. Rwanda does not have a published National Adaptation Plan nor a Long-term Strategy (LTS). The full description of climate risks is provided in the section on Country Context. 67. Assessment and reduction of adaptation risks. The project adequately reduces the physical climate risks to the project outcomes. The project’s climate resilience and adaptation design considerations limit the vul nerability of the infrastructure to a low level of residual risk. The project invests in the design, upgrading, and performance-based maintenance of four road sections in the KLP/Bugesera connector road to climate resilient standards. Examples of climate resilience measures include the deployment of appropriate drainage infrastructure and erosion and landslide 16 prevention measures like the protection of road embankments, specialized pavement surface materials, and tree planting along the road corridor. The project also invests in trade facilitation and logistics improvements such as the deployment of basic infrastructure and facilities for at least one SME/industrial park, the upgrading/construction of markets and selling points in selected villages or along roads, and the construction of an SME-oriented warehouse and e-commerce hub. These trade facilitation and logistics facilities will be built to climate resilient standards. Component 2 also invests in the update of the Logistics and Distribution Services Strategy for Rwanda considering climate resilience aspects like transboundary climate risks (e.g: shared river basins and wildfires) and compounding cascading impacts on trade and transport linkages. The project is therefore assessed to be low risk and aligned from an adaptation perspective. 68. Assessment and reduction of mitigation risks. The operation is not at a material risk of having a negative impact on the country’s low-GHG-emissions development pathways. The activities financed by the project are either universally aligned (UA) or present low mitigation risk. The project invests in the design, upgrading, and performance- based maintenance of four road sections in the KLP/Bugesera connector road without capacity expansion and there is no risk of contributing to deforestation. Rwanda has very low motorization rates with 14 vehicles per 1,000 inhabitants.50 The project also invests in basic infrastructure and facilities like markets and roadside selling points, an SME/industrial park and SME-oriented warehouse which will be grid connected and include energy efficient equipment and solar powered or LED lighting. Component 2 also invests in the update of the Logistics and Distribution Services Strategy for Rwanda, including the potential for the uptake of electric mobility domestically and implications for regional integration, and multimodal transportation. The project is therefore assessed to be aligned from a mitigation perspective. Road Safety Screening and Measures 69. RTDA conducts road safety audits and is engaged in the development of a road safety manual and carrying out capacity building on road safety and inspection audits. The project will continue to support RTDA and the MININFRA to implement road safety interventions including: (a) traffic safety sensitization campaigns for schools, health centers, and markets along the project roads, and (b) community engagement sessions for road safety at district level for a sustained awareness communication in the community, including providing them with small equipment and capacity building. The project will also support MININFRA in setting up a road safety strategy. Those activities will draw lessons from the ongoing projects (LVTP and FRDP), mainly the road safety audit recently conducted for LVTP, to build a comprehensive road safety agenda to reduce fatalities and injuries. B. Fiduciary Financial Management 70. A financial management (FM) assessment was carried out for the project in accordance with the World Bank Policy and Directives for Investment Project Financing (IPF). The assessment was carried out on the two key implementing entities, RTDA and MINICOM to determine whether the implementing entities have acceptable FM arrangements, which will ensure that: (a) funds are used for the intended purposes in an effective, efficient, and economical way; (b) financial reports will be prepared in a reliable, accurate, and timely manner; and (c) project assets will be appropriately safeguarded. 71. The project benefits from the country’s public financial management reforms, the project’s oversight and accountability arrangements and experience obtained from implementing World Bank-funded projects. The public financial management system is anchored in solid legal frameworks and public financial management strategies. Progress has been made in budget planning, expenditure efficiency, enhancement of the internal audit function, external audit coverage, and financial reporting. The Public Expenditure and Financial Accountability 2022 confirmed these strengths. The project has acceptable project oversight and accountability structure which involves a national SC, management oversight, internal oversight bodies (internal audit and audit committee), external oversight bodies 50Ayetor G.K, Mbonigaba I., Ampofo J., Sunni, Investigating the state of road vehicle emissions in Africa: A case study of Ghana and Rwanda . The Transportation Research Interdisciplinary Perspectives; Elsevier. September 2021. 17 (Office of the Auditor General), and Parliament that approves the government’s budget. 72. Based on the assessment conducted, the FM risk of the project is rated moderate. RTDA and MINICOM have adequate experience in managing World Bank-financed operations and have mostly complied with key FM deliverables. The following key risks are identified: (i) inadequate preparation of Annual and Work Plan and Budget (AWPB) which could lead to irregularities in spending and accountability of resources; (ii) overstretching of existing finance personnel at the RTDA SPIU which results from managing various projects; and (iii) delay in submission of quality financial reports and taking timely action on audit report findings. These risks will be mitigated through placing and maintaining adequate staff at the two SPIUs throughout the project life, provision of capacity building and training on World Bank-financed operations and using internal audit functions to assist in the timely action on audit report findings. A PIM will clarify roles and responsibilities as well as the timelines for preparation of AWPB, reporting and auditing requirements. An action plan was prepared to help mitigate the identified risks and will be monitored throughout implementation. 73. The FM arrangement of the project will be the following: AWPB will be prepared for each of the components/categories detailing IDA and GoR resources which will be submitted to the World Bank for approval. The SPIUs at the implementing entities will be adequately staffed and will receive training on managing World Bank- financed projects. Each entity will have its own designated account and will implement its part of the project; submit quarterly financial reports and annual audit reports to the World Bank. The internal audit units of each entity will audit the project and make their reports available to the World Bank as required. Each entity will have the responsibility to take timely action on the audit report findings and notify the same to the World Bank. Detailed FM arrangements will be captured as part of the PIM. Procurement 74. The project procurement will be carried out in accordance with the World Bank Procurement Regulations for IPF Borrowers, dated September 2023, hereinafter referred to as ‘Procurement Regulations’. The project will be subject to the World Bank’s Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants (Anticorruption Guidelines), dated October 15, 2006, and revised in January 2011 and as of July 1, 2016, and beneficiary disclosure requirements. The project will use Systematic Tracking of Exchanges in Procurement (STEP), a planning and tracking system that will provide data on procurement activities, establish benchmarks, monitor delays, and measure procurement performance. 75. As per the requirement of the Procurement Regulations, a Project Procurement Strategy for Development (PPSD) will set out the selection methods to be followed by the GoR during project implementation in the procurement of goods, works, non-consulting and consulting services financed by the World Bank. The underlying Procurement Plan will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. 76. Rated criteria will be used for all international competitive procurements, with exception of procurement of pharmaceuticals, vaccines, off-the-shelf goods and educational materials, commodities and other exceptions cleared by the World Bank’s Chief Procurement Officer on a fit-for-purpose basis, where use of rated criteria is not mandatory. The rated criteria are also a tool for taking sustainable procurement (environmental, social, economic and climate change) into consideration in the procurement processes. 77. Based on risks and gaps identified, the procurement risk rating of the project is moderate. The concept-stage Procurement Risk Assessment and Management System (PRAMS) with the Moderate procurement performance was validated, with the key risk identified as: (a) corruption, collusion, and conflicts of interest, (b) contract price increase due to inflation, currency instability, and interest rates, (c) unexpected extreme weather, intense rainfall, and landslides, (d) access and registration issues by bidders to e-procurement system, and (e) limited skills for contract management under OPBRC. 78. Agreed mitigation measure are: (i) improvement of the complaint management system, strengthening internal and external audits, and disclosure of information and procurement data to the public; (ii) making sure provision for price adjustment is included in contract documents; (iii) appropriate design and work plan by DBM 18 contractors and adequate design review and monitoring consultancy is put in place; (iv) RTDA initiating a discussion with Rwanda Public Procurement Authority (RPPA) e-GP unit to solve the access to e-GP issue; and (v) conducting intensive training on management of the OPBRC. 79. RTDA’s SPIU includes three procurement staff and MINICOM’s SPIU has three procurement staff positions, with one currently vacant. Currently RTDA SPIU has three experienced procurement staffs. The existing procurement staff has the required competence to manage procurement under the project. However, the workload will require technical assistance on procurement that will be recruited under the project. MINICOM SPIU currently has no procurement staff, but MINICOM has two procurement staff who can provide support to MINICOM-SPIU, while a recruitment of a dedicated procurement specialist staff is processed. C. Legal Operational Policies @#&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 D. Environment and Social Environment 80. The environmental risk rating of the project is high. Project activities include upgrading 69.45 km of existing gravel road to an asphalt road and construction of small-scale basic infrastructure investments along the road, such as markets, selling points, harvest storages, MSMEs/industrial parks, warehouses, etc. These activities generating adverse impacts on the nearby biophysical environment, as well as the existing limited capacity of the implementing agencies (RTDA and MINICOM) in the environmental and social standards and health and safety risk management. 81. The 69.45 km road alignment, with a RoWs that ranges between 10.4 meters in rural areas and 18.4 meters in urban areas, runs parallel to biophysical and socio-economic environmental features. Some features include sensitive receptors like schools, settlements, and business areas as well as certain critical habitats, including Lake Kidogo, and the Akagera and Rugende marshlands. Sections of these two marshlands are currently dominated by anthropogenic activities and changed to farmlands, mainly producing sugarcane, beans, and rice. Significant vegetation along the project road is lacking as it has been progressively replaced with small vegetation and eucalyptus due to human occupation. These terrestrial and aquatic habitats are likely to be affected by the project activities financed under components 1 and 2. 82. The project area is located outside existing protected areas. Considering the project baseline information and the type and scale of the KLPConnect project core and ancillary facility activities, the main environmental risks identified at this stage are related to construction works associated with the upgrading of KLP/Bugesera Connector Road (subcomponent 1.1) as well as roadside small-scale basic infrastructure financed under subcomponents 1.2, 2., and 2.2. These impacts include clearance of vegetation, occupational health and safety risks and road traffic accidents, encroachment of sensitive habitats, soil erosion and sedimentation of surface water bodies, soil and water pollution due to spills and leaks of oils, fuels, chemicals, temporary air quality nuisance due to air emission of CO2 and (Azotic Monoxide) NOx from combustion of diesel from vehicles, hot and batch mix plant, diesel generator sets, noise pollution from vehicles, machinery, concrete mixing; and solid and liquid wastes. 83. Due to the nature of the project and the anticipated environmental and social risks and impacts, eight of the ten Environmental and Social Standards (ESSs) apply to the project, i.e., all but ESS 7 and ESS 9. To manage those risks and impacts, the recipient has prepared an Environment and Social Impact Assessment, Environmental and Social Management Framework (ESMF), Resettlement Framework (RF), Resettlement Plan (RP), Stakeholders Engagement Plan (SEP), Labor Management Plan (LMP), and a Gender-Based Violence Prevention and Response Action Plan (GBVPRAP), in line with the ESSs. These instruments have been captured in the Environmental and Social Commitment Plan (ESCP), which describes the supplemental instruments to be updated, adopted, and actions to be performed during project 19 implementation. The final versions of ESCP, SEP, ESIA, LMP, and ESMF have been disclosed both on the RTDA as well as the World Bank’s external websites. The RP, RF, and the GBVPRAP advanced versions have been disclosed in country RTDA website) and they are currently under World Bank review. Below is the table indicated the date of disclosure. Table 4: Dates of ESF documents disclosure Instruments Disclosure In-country Disclosure on World Bank website th ESMF 16 Oct 2023 02/23/2024 ESIA 16th Oct 2023 02/23/2024 SEP th 02/13/2024 16 Oct 2023 th ESCP 16 Oct 2024 02/13/2024 th LMP 16 Oct 2023 To be disclosed by March 15, 2024 51 th RP 16 Oct 2023 Under finalization RF 16th Oct 2023 Under finalization GBVPRAP 01/22/2024 Under finalization 84. To avoid and/or minimize the anticipated environmental impacts, the mitigation and management measures are stipulated in the project’s Environment and Social Framework (ESF) instruments. In addition, specific interventions such as roadside tree planting, the development of bridge construction, and a buffer zone establishment are in place. The roadside tree planting will focus on locally adaptable and high carbon sequestration capacity species as a provision of green roads and compensation of affected trees. Likewise, the establishment and management of buffer zones will be in selected lakes, mainly along lake Kidogo. A method of statement for the construction of bridges on sensitive rivers and marshlands, such as the Akagera river, will be developed and implemented. Management strategy and implementation plans related to water resource management and protection of any existing aquatic ecosystems along the project corridor from any point and nonpoint sources of pollution will be prepared and implemented before the commencement of civil works during the project implementation period. Social 85. The social risk rating of the project is high. Overall, the project is expected to promote positive social benefits for the wider population and transformation of transport through road construction and rehabilitation. The identified key potential social risks and impacts include loss of land holdings, assets, and livelihoods on the land, including informal businesses, resulting in physical and economic displacement; conflicts resulting from resettlement, relocation of assets, risks of vulnerable/disadvantaged population or social categories who by virtue of gender, or groups who may be potentially excluded from their associated benefits; road construction activities related to health and safety risks to communities and workers; risks associated with labor management and local demand for employment; and labor influx related risks, including spread of communicable diseases and potential Gender Based Violence, Sexual Exploitation and Abuse (SEA), and Sexual Harassment (SH) from interactions of local communities/population with contractor’s laborers. 86. Labor and Working Conditions (ESS2). Given the scale of road construction works and the large number of workers within urbanized settings, occupational health and safety risks are likely. Labor-related risks, such as non- compliance to labor requirements by contractors and other employees, including adherence to working hours, pay and legally mandated benefits, equal and fair recruitment, and employment, are also probable. An LMP has been prepared which outlines the framework that the project will apply to manage labor-related risks associated with the project during implementation. The LMP has also been disclosed in-country (RTDA website) on February 26, 2024. 87. Community Health and Safety (ESS4). The project will improve health and safety by the construction and rehabilitation of the road. Construction works/activities may pose safety concerns for the local communities; however, these construction impacts would be readily mitigated. 88. Land Acquisition, Restrictions on Land Use, and Involuntary Resettlement (ESS5). A RP for the component 1, prepared by the GoR, assessed the number of households living within the RoW as 2,857, out of which 509 will be fully 51The RP, RF, and GBVPRAP have been disclosed in country at advanced version. They are under review by RSA. 20 relocated. The RP and options for their rehabilitation were discussed with the affected communities through consultations in the three districts, key informant interviews with the local authorities, and focused group discussions held alongside the road corridor. The final draft RP was cleared by the World Bank and disclosed in country on February 9, 2024. The financing needed to support resettlement is estimated to be US$8 million and will be funded by IDA through subcomponent 1.2 of the project. 89. Stakeholder Engagement and Information Disclosure (ESS10). This plan will address specific risks identified by stakeholders, including the risks to vulnerable persons, and will be updated as and when necessary. The objective is to establish a systematic approach for stakeholder engagement, maintain a constructive relationship with them, consider stakeholders’ views, promote, and provide means for effective and inclusive engagement with project -affected parties throughout the project life cycle, and ensure that appropriate project information is disclosed to stakeholders in a timely, understandable, accessible, and appropriate manner. The project will set up a project-specific grievance redress and feedback mechanism for people to report concerns or complaints if they feel unfairly treated or affected by sub-projects. Gender 90. Despite Rwanda’s significant achievements on gender equality, women represent only 7.4 percent of employment in transport sector. The low participation in the sector workforce is due to women’s lack of specific technical skills related to the core functions of the transport sector, poor working conditions such as lack of flexible working hours, absence of family friendly policies, and lack of career prospects for women. Also, women seem to benefit less from the trade expansion than men. A United Nations Conference on Trade and Development (UNCTAD) analysis looked at the effects of exports on women's employment in Rwanda and called for measures to help women enter export-oriented sectors (e.g., commercial agriculture crops) and upgraded supply chains through capacity development and access to resources. Gender disparities in entrepreneurship exist as well, as women open fewer formal businesses than men, particularly in rural areas. 52 91. The project will seek to address gender gaps in the transport and logistics sector related to women’s engagement in entrepreneurship and trade activities as well as employment in the sector . Under Component 2, the project will strive to address the gender gaps related to women’s engagement in entrepreneurship and trade. The project will provide women trading along the roads with capacity building to manage their trade more efficiently. It will open opportunities for the youth in the project area through construction and rehabilitation of basic and economic infrastructures (markets and selling points). 92. Special attention will be given to address the constraints that women usually face in connection with various phases of the skill development process. To facilitate access to training, consideration will be given to the training’s location, timing, and safety aspects of the journey. In addition, an analysis of the barriers for female entrepreneurship will be conducted to identify activities to boost their business and revenue potential.53 Under components 2 and 3, the project will address gender inequalities by enhancing women’s representation through employment opportunities and women skills development in core functions of the trade and transport industry.54. 93. The project will align with the World Bank’s Good Practice Note on addressin g SEA and SH in investment projects involving major civil works. The project will also establish a robust grievance redress mechanism and ensure adherence to the stakeholder engagement plan. Climate and Disaster Risk Screening 94. The project locations are exposed to rising flood and drought risks, with expected high impacts on road infrastructure, water availability and food security. The project location has experienced climate and geophysical hazards in the past and is expected to experience these in the future will high intensity, frequency, or duration. Floods increase soil erosion and silting of drainage infrastructure leading to water submerging roads. Accordingly, the exposure is rated as high since projections indicate an increase in mean and extreme temperatures and precipitation variability with high 52 UNCTAD, Op. cit. 53 The analysis will focus on procedures and regulations that impact on women’s opportunities and will help design training activities. 54 The project promotes women’s employment in transport by providing female university graduates interns working in the industry. 21 risk of flooding and droughts in future decades. Despite the high exposure risk to natural climate risk and natural hazards, the potential impacts on the project’s physical infrastructure and assets are expected to be moderate. The moderate impact rating is based on the deployment of resilience and adaptation measures, including integration climate information, such as: (i) vulnerable area mapping, in the planning and design of activities, (ii) adopting climate informed design and the provision of regular maintenance, and (iii) the planting of trees to combat land degradation, erosion, and the occurrence of landslides. The remaining risks will be modulated by the project’s soft com ponents and development context leading to a low risk of outcome/service delivery. 95. The roads have been designed and will be constructed with mitigation and adaptation measures to make them resilient to climate change. The design has addressed the geometric condition of the road to make more resilient to water crossing and its damages. The design of roads has considered, among others, the speed, the traffic stream and volume, pedestrians use, safety parameters for roads users, available space (land use), and the climatic impacts. In consideration to the climatic impacts on the road, the design envisages to: (i) raise the height of the road above the natural level, (ii) construct drainage canal along the roads, (iii) construct bridges to over pass the rivers, and (iv) sealing of the roads to protect the surface against infiltration that can lead to road under soil wash up; given the fact that the existing roads were unpaved and were subject to damage due to water flow. For safety reason and to protect the roads against water (sustainability reason), the road surface will be raised by about 50 cm from the initial level to avoid water crossing over the road. The same surface will be sealed. When earmarked, the share of the investment of this activity that is preventing and mitigating climate change, is estimated at about 30 % of the road cost meaning around US$17.00 million. The selection of side slopes is dependent upon safety considerations, height of fill or cut, and type of material. The slopes will ensure stability of the embankment to provide an opportunity for out-of-control vehicles to recover safely. For backslope on the other hand, the determining factor aside from safety is the desire to limit acquisition of land to accommodate the road corridor. Further geological investigations provide critical information on which safe design of side slopes especially in cuts are based. During the road construction, the embarkment and slopes will be flattened but bringing material with consistency that avoid side slope flattening in areas with expansive soils. 96. Construction of climate resilient bridges, culverts, and drainage channel will mitigate the increased level of water flow because of climate change and make the roads resilient during its life cycle. Data has been collected to inform the condition survey of existing hydraulic structures, their topographical locations, and water flow rates. Two main rivers traversed the road: (i) Akagera river crossing the road Masaka-Kabukuba; and (ii) Rugende stream crossing the road Masaka-Kabukuba. The feasibility study shows that there are many culverts along the roads that have insufficient hydraulic capacity to carry the water flow and they need upgrading. Along the KLP Connector roads, about 140 culverts out of 153 will be rehabilitated (US$16.5 million). Also, about 234 cross drainage structures (US$8.50 million) will be constructed as a solution to improve the road resilience to climate. Four bridges are planned along the KLP connector roads to replace existing bridges that are bailey steel bridges and found to be hydraulically insufficient and structurally inadequate. The amount allocated to the bridges is US$10 million. The design of the roads was planned to construct ditches to collect water from the road and convey to outlet points. Additionally, the channel drains water from subbase layer of the road and avoid the runoff of the soil if it is over wet of rainwater. Table 5: List of culverts to be upgraded along the KLP connector roads. Number of Construction cost Number of Culverts Road section Length(km) culverts to be of culverts to be culverts to keep rehabilitated upgraded (US$) Masaka-Kabukuba 16.88 44 37 7 4,500,000 Kabukuba-Nyamata 13.72 22 21 1 2,500,000 Gahembe-Kindama 19.21 49 47 2 5,500,000 Kabukuba – Riziyeri 19.64 38 35 3 4,000,000 Total 69.45 153 140 13 16,500,000 22 Citizen Engagement The project will adopt a robust citizen engagement approach throughout its cycle, taking advantage of Rwanda’s well- established Grievance Redress Mechanism (GRM). Rwanda achieved substantial progress based on a strong leadership where leaders and citizens have a shared vision of the development projects. Citizen engagement considerations are part of the project implementation strategy, building on ongoing projects (LVTP, FRDP) practices. The project will implement a thorough consultation and communication strategy with the project stakeholders including citizens along the roads to develop an inclusive approach in considering the local communities’ concerns. RTDA organized public and stakeholders’ consultation in the districts from February 28, 2023, to July 7, 2023, to collect their views and concerns on the project and hear their proposals to remedy any adverse impact to their socioeconomic activities and their livelihoods. The stakeholder engagement plans, based on inclusive consultations, include a project-specific GRM that outlines opportunities and avenues by which project stakeholders can seek timely redress on project-related grievances and complaints. The project will track locals’ satisfaction regarding improvements made through the roads upgrading, and the community - level infrastructure investments financed under the project. The related beneficiary feedback will be monitored during project implementation through an indicator in the Results Framework. V. GRIEVANCE REDRESS MECHANISM (GRM) 97. 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 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, because 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 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. VI. KEY RISKS 98. The overall project risk rating is substantial, driven by institutional capacity for implementation and sustainability risk rated substantial and environmental and social (E&S) risk rated high. 99. This high E&S risk category is due to the location, type, sensitivity, and scale of project interventions as well as the client’s capacity. Upgrading and improving an existing 69.45 km road, as well as roadside small-scale investments will contribute to the nature and magnitude of potential E&S risks and impacts. The high E&S risk for the project has also been justified by the capacity of the IAs to implement environment and social standards for ongoing projects (mostly level of staffing and lack of funding for compensation). For IA capacity for ongoing projects and KLPConnect, RTDA has confirmed that recruitment of all missing environment and social staff has been completed and dedicated staff have been assigned to the KLPConnect. Despite this measure, a detailed assessment of the IAs’ capacity found response to be slow which signaled potential risk related to the implementation of environment and social mitigation measures. Accordingly, the project will ensure through its activities, adequate institutional capacity for the IAs’ and other relevant institutions that will be directly or indirectly engaged in the implementation of the project. 100. The institutional capacity for implementation and sustainability risk is rated substantial. RTDA has capacity for road works but will need to work closely with MINICOM for a better understanding in integration of trade and logistics dimension of the project. Conversely, MINICOM will need to work closely with a range of departments within and across leading ministries to implement its far-reaching set of activities. At the same time, each of the two associated SPIUs have been understaffed for current projects under implementation, impacting on project performance. Accordingly, RTDA has recently hired staff and will be maintaining a core cadre of staff (including E&S specialists, road safety specialists, a community development officer, procurement specialists, financial management specialists, M&E specialists, and an 23 accountant). For works execution, the project will launch a competitive process to recruit qualified enterprises. Simultaneously, MINICOM and its SPIU, along with responsible staff from other ministries, will be undergoing considerable capacity building in areas of technical relevance and project management. As a result, the residual institutional capacity risk after implementation of mitigation measures will be moderate. 24 The World Bank Kigali Logistics Platform Connectivity Development Project (P180228) VII. RESULTS FRAMEWORK AND MONITORING VII.a: Result Framework @#&OPS~Doctype~OPS^dynamics@padannexresultframework#doctemplate PDO Indicators by PDO Outcomes Baseline Period 1 Closing Period Improved resilient and safe connectivity from the KLP (Masaka) to regional logistics corridors Travel time from KLP to Ngoma-Nyanza highway (number of hours). (Hours) Mar/2024 Jun/2030 1.5 1.0 Number of health centers, schools, and markets with improved access in the project area. (Number) Jan/2024 Jan/2030 0 TBD Percentage of people with enhanced access to reliable transport infrastructure and services all year round in the project area (disaggregated by gender) (Percentage) Jan/2024 Jan/2030 0 80 Reinforced/upgraded critical structures (bridges, culverts, embankments) raised along the road sections to respond to increased vulnerability due to climate change effects (number). (Number) Jan/2024 Nov/2026 Sep/2030 0 1 4 Number of newly registered businesses established in the project area (disaggregated by gender) (Number) Mar/2024 Mar/2030 0 TBD Support local and regional economic activities around the corridors Number of registered businesses established in the project area. (Disaggregated by gender) (Number) Jan/2024 Mar/2030 TBD TBD Intermediate Indicators by Components Page 25 The World Bank Kigali Logistics Platform Connectivity Development Project (P180228) Baseline Closing Period Component 1:Improving physical infrastructure Roads rehablitated (Kilometers) CRI Mar/2024 Mar/2030 0 69.45 Roads in good and fair condition as a share of total classified roads (Percentage) Jan/2024 Jan/2030 96 97 Road safety measures introduced on the road corridor from Masaka to Bugesera (Yes/No) Jan/2024 Jan/2030 No Yes Road safety and post-crash response sensitization conducted for schools, health centers, and markets along the 69.45 km of roads from Masaka to Bugesera (two routes) (number of people) (Number) Jan/2024 Jan/2030 0 20 Survey reports on citizen engagement available (Yes/No) Jan/2024 Jan/2030 No Yes Protected community facilities against erosion/storm water/flooding (Number) Mar/2024 Mar/2030 0 TBD Component 2: Trade facilitation and Logistics improvement Number of permanent jobs created in the e-commerce hub and the SMEs parks that are equipped of basic infrastructures construction and markets and selling points (Number) Jan/2024 Jun/2030 0 TBD Temporary jobs created by the project (roads, markets, selling points, etc.) (Number) Jan/2024 Jun/2030 0 TBD Market centers and selling points connected by paved roads (Number) Jan/2024 Jan/2030 0 13 Share of targeted local traders with improved trade and business competency (Percentage) (Percentage) Page 26 The World Bank Kigali Logistics Platform Connectivity Development Project (P180228) Jan/2024 Jun/2030 0 100 Private capital enabled (industrial park, roadside markets, selling points, and e-commerce warehouse) (Amount(USD)) Jun/2024 Jun/2030 0 20000000 Number of staff of MINICOM who benefited from capacity building trainings. (Number) Jan/2024 Jun/2030 0 30 Number of Kilometers for Asphalt roads constructed in the SME Park. (Number) Jan/2024 Jun/2030 0 6 KM Number of KVA supplied to the SME Park. (Number) Jan/2024 Jun/2030 0 6,546 kVA Number of markets and selling points upgraded. (Number) Jan/2024 Jun/2030 0 6 Number of businesses/people trained/coached in e-commerce. (Number) Jan/2024 Jun/2030 0 TBD Component 3: Implementation support, monitoring, and capacity building Number of staff of RTDA who benefited from capacity building trainings (Number) Jan/2024 Jan/2030 0 30 Females employed in permanent jobs and internship on basic infrastructures, economic infrastructures, and roads construction, SMEs industrial parks (Percentage) Jan/2024 Jan/2030 0 30 Community satisfaction on socio-economic infrastructure and roads works (Percentage) Mar/2024 Jun/2030 0 80 Component 4: Contingency Emergency Response (CERC) Physical Contingencies Page 27 The World Bank Kigali Logistics Platform Connectivity Development Project (P180228) Page 28 VII.b: Monitoring & Evaluation Plan for Each Indicator Indicator Definition/description Frequency Data source Data collection Responsibility method for data collection PDO outcome 1. Improved resilient and safe connectivity from the KLP (Masaka) to regional logistics corridors. Indicator 1. Reduced travel time between The time traveled from start At the start and The data will be Collection of data RTDA KLP and the Nyanza-Ngoma Highway to the end of the project after completion collected by the M&E will be done by junction at Ngoma. road measured in hours. of works Consultant to conduct using the Moving baseline survey and Observer monitoring and method assisted evaluation of the by GPS. project. His/her reports will be approved by RTDA. Indicator 2. Percentage of people with The indicator measures the At the start and Monitoring Review of the RTDA enhanced access to reliable transport proportion of the number of after completion Consultant progress Project reports infrastructure and services all year round people expected to have of works reports approved by in the project area (disaggregated in direct access to an improved RTDA. gender) climate-resilient road along the upgraded roads sections Indicator 3. Number of health centers, Number of health centers, At the start and Monitoring Review of the RTDA schools, and markets with improved schools, and market centers after completion Consultant progress Project reports access in the project area with improved access in the of works reports approved by project area. RTDA. Indicator 4. Reinforced/upgraded critical Critical structures located on At the start and Monitoring Review of the RTDA structures (bridges, culverts, the roads with enhance after completion Consultant progress Project reports embankments) raised along the road adaptability to climate of works reports approved by sections to respond to increased change effects (floodings, RTDA vulnerability due to climate change effects increase water flow) (number). PDO outcome 2. Support local and regional economic activities around the corridors. Indicator 1. Number of registered At the start and The data will be Baseline survey MINICOM businesses established in after completion collected by the and Review of the the project area. of the basic and M&E Consultant to Project reports economic conduct baseline Page 29 Indicator Definition/description Frequency Data source Data collection Responsibility method for data collection Number of registered businesses (Disaggregated by gender) infrastructure survey and established in the project area. (Number) construction monitoring and (Disaggregated by gender) (Number) evaluation of the project. His/her reports will be approved by MINICOM. Component 1: Improving physical infrastructure to connect KLP to regional logistics corridors IR Indicator 1: Roads rehabilitated with The total length of road At the start and Monitoring Review of the RTDA climate-resilient and resilience to sections paved under the after completion Consultant progress Project reports flooding measures (Kilometers) project integrating climate of works reports approved by mitigation and adaptation RTDA. measures (in kilometers) IR Indicator 2. Roads in good and fair Percentage of the total At the start and Monitoring Review of the RTDA condition as a share of total classified classified road network in after completion Consultant progress Project reports roads the project area that is in of works reports approved by good and fair condition RTDA. depending on the road surface and the level of roughness. (In number). IR Indicator 3. Road safety measures To confirm whether the Annual Monitoring Review of the RTDA introduced on the road corridor from road safety measures have Consultant progress Project reports Masaka to Bugesera. been introduced under the reports approved by project on the road corridor RTDA. from Masaka to Bugesera. (Yes/No) IR Indicator 4. Road safety and post-crash Number of people who Annual Monitoring Review of the RTDA response sensitization conducted for participated in the Consultant progress Project reports schools, health centers, and markets sensitization meetings reports approved by along the 69.45 km of road from Masaka organized on road safety and RTDA. to Bugesera (two routes) (number of post-crash response in people) schools, health centers and market centers under the project. IR Indicator 5. Protected community Number the communities’ At the start and Project progress Review of the RTDA facilities against erosion/storm facilities that are protected after completion reports project reports water/flooding (number). due to the anti-erosion and of works storm water control activities Page 30 Indicator Definition/description Frequency Data source Data collection Responsibility method for data collection IR Indicator 6. Survey reports available on To confirm whether the Monitoring Review of the RTDA citizen engagement available reports on citizen Consultant progress Project reports engagement for the project reports approved by implementation are RTDA. available. Component 2: Trade facilitation and logistics improvement IR Indicator 1. Number of permanent Number of permanent jobs At the start and The data will be Review of the MINICOM jobs created in the e-commerce hub and created in the e-commerce after completion collected by the Project reports the SMEs parks that are equipped of hub and the SMEs parks of works M&E Consultant to basic infrastructures construction and that are equipped of basic conduct baseline markets and selling points. infrastructures survey and construction and markets monitoring and and selling points. evaluation of the project. His/her reports will be approved by MINICOM. IR Indicator 2. Temporary jobs created by Number of temporary jobs At the start, at Monitoring Review of the MINICOM the project (roads, markets, selling created by the project the midterm Consultant progress Project reports points, etc.) activities such as roads, and after reports approved by markets, selling points completion of MINICOM. construction works in the works project area. IR Indicator 3. Market centers and selling Number of markets centers At the start and Monitoring Review of the MINICOM points connected by paved roads and selling points after completion Consultant progress Project reports connected by paved roads of works reports approved by MINICOM. IR Indicator 4. Share of targeted local Percentage of targeted Annual Monitoring Review of the MINICOM traders with improved trade and traders with improved Consultant progress Project reports business competency trade and business reports approved by competency. MINICOM. IR Indicator 5. Private capital enabled Private capital enabling to At the start, at Monitoring Review of the MINICOM (industrial parks, roadside markets, be provided along with mid-term and Consultant progress Project reports selling points and e-commerce) infrastructure to be built after completion reports approved by (Industrial parks, roadside of works MINICOM. markets, selling points and e-commerce) IR Indicator 6. Number of staff of Number of staff of Annual Monitoring MINICOM MINICOM MINICOM who benefited from capacity MINICOM who benefited Consultant progress progress report building trainings. from capacity building reports approved by Page 31 Indicator Definition/description Frequency Data source Data collection Responsibility method for data collection trainings. MINICOM. IR Indicator 7. Number of Kilometers for Number of Kilometers for At the start and Monitoring Review of the MINICOM Asphalt roads constructed in the SME Asphalt roads constructed after completion Consultant progress Project reports Park in the SME Park of works reports approved by MINICOM. IR Indicator 8. Number of KVA supplied to Number of Kilo-volt- At the start and Monitoring Review of the MINICOM the SME Park amperes supplied to the after completion Consultant progress Project reports SME Park in the project of works reports approved by area. MINICOM. IR Indicator 9. Number of markets and Number of markets and At the start and Monitoring Review of the MINICOM selling points upgraded. selling points upgraded in after completion Consultant progress Project reports the project area. of works reports approved by MINICOM. IR Indicator 10. Number of Number of Annual Monitoring Review of the MINICOM businesses/people trained/coached in e- businesses/people Consultant progress Project reports commerce trained/coached in e- reports approved by commerce in the project MINICOM. area Component 3: Implementation support, project monitoring, and capacity building. IR Indicator 1: Number of staff of RTDA Number of staff members Annual Monitoring Review of the RTDA who benefited from capacity building from RTDA who participated Consultant progress Project reports trainings in the capacity building reports approved by trainings organized under RTDA. the project IR Indicator 2. Females employed in Percentage of females Annual Monitoring Review of the RTDA permanent jobs and internship on basic employed in permanent Consultant progress Project reports infrastructures, economic jobs and internship on basic reports approved by infrastructures, and roads construction, infrastructures, economic RTDA. SMEs industrial parks infrastructures, and roads construction, SMEs industrial parks in the project area. IR Indicator 3. Community satisfaction on Percentage of communities After Monitoring Survey and RTDA socio-economic infrastructure and roads reported satisfied on socio- completion of Consultant progress Review of the works economic infrastructure works reports approved by Project reports and roads works in the RTDA. project area. Page 32 Annex 1: Implementation Arrangements and Support Plan A. Institutional and Implementation Arrangements 1. The Ministry of Finance and Economic Planning (MINECOFIN) is the representative of the government on the issues related to the Financing Agreement. It will offer guidance and leadership on the utilization of the project’s counterpart funds. Other entities involved are MININFRA, MINICOM, RTDA, and the Road Maintenance Fund. The Rwanda Environment Management Authority (REMA) and the district’s authorities are also part of the project. The project implementation will be organized as described in the below organizational chart: 2. Steering Committee. A Steering Committee (SC) comprised of the Permanent Secretaries (PS) of MININFRA and MINICOM, a representative of MINECOFIN, and the Director General (DG) of RTDA will oversee the project implementation. They will convene bi-annually. The SC will make directional decisions on various project implementation aspects. 3. Overall Coordination. Under the coordination of the MININFRA, the project coordination will be led by the SPIU within RTDA, which will serve as the direct interlocutor with the World Bank and will report on project progress throughout implementation. Page 33 4. Implementation agencies and responsibilities arrangements. The project will have two implementing agencies: the Single Project Implementation Units (SPIUs) of RTDA (MININFRA) and MINICOM. Thus, two special accounts will be created, one for each IA. Each SPIU will handle technical matters, procurement, financial management, and environment and social issues for their respective components, subcomponents, and related activities. The teams from both SPIUs will meet monthly to discuss project progress. The capacity of the SPIUs and the ministries’ technical departments to implement the project activities will be reinforced by additional staff to be recruited as needed. 5. Team composition to implement the project. For successful project implementation, it was agreed to designate a team in each IA (RTDA and MINICOM) for the project implementation. RTDA and MINICOM have submitted the list of the designated staff (per specialties) who will be implementing the project. 6. Role of the Ministry of Finance and Economic Planning (MINECOFIN). MINECOFIN is the legitimate representative of the government on the issues related to the Financing Agreement. It will offer guidance and leadership on the utilization of the project’s counterpart funds. 7. Role of the Ministry of Infrastructure (MININFRA). MININFRA is responsible for overall transport policy and strategic planning, the creation of a transport enabling environment, and setting of transport rules, regulations, standards, and strategic planning. The Directorate of Transport will be leading the implementation of activities related to policy and strategy. 8. Role of the Ministry of Trade and Industry (MINICOM). MINICOM, in KLP/Bugesera connectors project, the MINICOM will be engaged as part of key patrons of project investments and reforms for the improved economic growth and regional development dynamics around the project area. The Directorate of Trade will be leading the implementation of activities related to policy and strategy. 9. Role of the Rwanda Transport Development Agency (RTDA). RTDA assists MININFRA with the management and administration of the transport sector, and the planning, prioritizing, approval, delivery, management, and maintenance of infrastructure, including support to districts as the managing and implementing agencies. RTDA will draw on expertise from the Rwanda National Police (RNP) for the Road Safety, Rwanda Energy Group Limited (REG) for road lighting and electrical utilities relocation, and Water and Sanitation Corporation (WASAC Ltd) for water utilities relocation. 10. Role of the Road Maintenance Fund (RMF). The RMF is responsible for road maintenance including rehabilitation. It is funded from the public budget. Maintenance of national roads, district roads class I and class II are under the financing of the RMF. 11. Role of the Rwanda Environment Management Authority (REMA). The mission of REMA is to supervise and monitor environmental management and ensure that issues relating to environment receive attention in all national development plans. REMA will play the leading role of monitoring the activities of the project according to the Organic Law establishing REMA and its functions. 12. Role of Rwanda Standard Board (RSB). The role is to provide quality and affordable standardization, metrology, quality testing and certification services for sustainable socio-economic development. RSB will benefit from equipment to reinforce its capacity to contribute to the promotion of trade and competitiveness of products. Standardization, conformity assessment and metrology services are key in supporting various businesses in the production of safe and quality products. Page 34 13. Role of Rwanda Development Board (RDB). The RDB role is to accelerate Rwanda’s economic development by enabling private sector growth. RDB was established in 2008 primarily to create a One Stop Shop for business and investments. Currently, RDB’s key services are: One Stop Center services (business and investment registration, visa facilitation, EIA, tax incentives management, etc.), Investment Promotion, Investment Deals Negotiation, Export and SEZ Development, Tourism and Conservation, and Private Sector Skills Development. RDB’s vision is to transform Rwanda into a dynamic global hub for business, investment, and innovation. 14. Role of District authorities. The district authorities in the project area are the coordinating body for any resettlement activities at the district level. They oversee, coordinate, and facilitate the implementation process of resettlement activities across local governments under its jurisdiction. The district-level departments (infrastructure, water, and energy officers in case of this RAP) in collaboration with grassroots administrative officials (Sectors and Cells’ executive secretaries) provide a review and monitoring role and provide political and administrative support for the implementation of the Resettlement Action. B. Results Monitoring and Evaluation Arrangements 15. The project objectives and corresponding indicators are designed to measure the results of the entire interventions. The M&E system will capture information to assess project results against the targets set as part of the Results Framework. The baseline information has been withdrawn from the Feasibility Study undertaken during preparation and will be followed up with beneficiary surveys and other assessments at the midterm review (MTR) and at project closing to evaluate qualitative and quantitative aspects of project results. The progress of project indicators will be measured through the implementation support missions and some specific surveys. Specific details for project management and reporting will be laid out in the PIM that will serve as the overall guiding document for SPIU. The recipient will carry out a Mid-Term Review, three years into implementation. C. Sustainability 16. KLPConnect is expected to address sustainability of the infrastructure investments and trade facilitation measures, through enhanced ownership of the participating administration. The road upgrading will be implemented through a Design Build and Maintain (DBM) arrangement to ensure that maintenance of the investment is guaranteed for the initial three years after completion of the upgrading works. This system will facilitate the undertaking of maintenance along the roads after completion of the works. In Rwanda, the existing RMF will ensure sustainability of long-term maintenance, and enforcement of axle load control by along the corridor will help preserve the road asset. The GoR has managed to keep the national paved road asset at an acceptable riding standard since creation of RTDA in 2010 using the RNP as core financing source for maintenance. Annual assessment of the riding quality is conducted with the use of Roughness meters and Bump integrators and reports are shared with the Development Partners via Transport Sector Working Group sessions annually. D. Financial management 17. Planning and budgeting. Both RTDA and MINICOM will follow the GoR’s planning and budgeting procedures. The project budgets will also be presented to the National Steering Committee for approval and included in the overall country budgets approved by the Parliament. The approved budgets will be monitored on a monthly and quarterly basis by the preparation and analysis of budget execution reports including: (a) budget for the period and for the year, (b) actual expenditure for the period and to date, (c) future expenditure commitments, and (d) balance of period budget remaining (actual expenditure Page 35 and commitments together compared to period budget). The consolidated annual workplan and budget that clearly show planned activities under each component and implementing entity will be submitted to the World Bank for no-objection. 18. Accounting and staffing. Both implementing entities use the Integrated Financial Management System (IFMIS) to record their transactions. There is a well-established SPIU for RTDA, but MINICOM SPIU must set up. The current staffing level of these units in terms of finance staff is as follows: (i) RTDA – six (Financial Manager, FMS, and Four Accountants), and (ii) MINICOM –two (one FMS and one Accountant). However, gaps in financial management of other projects have been noted as the SPIU’s are managing multiple projects. Therefore, to manage this project RTDA will assign an Accountant for the project. There will be a comprehensive start-up workshop where all implementing entities will be sensitised on the project’ s financial management requirements to build on capacity on managing World Bank-financed operations. Regular training will thereafter be provided for continuous improvement during project implementation. 19. Internal control and internal audit. All implementing entities are governed by the legal frameworks and manuals prescribed above. The project involves financing from both IDA and GoR and has multiple components and subcomponents which will involve specific arrangements such as CERC. Therefore, the recipient will develop and adopt a PIM that will reflect the FM arrangements under this project, covering all the implementing agencies and arrangements under each of the components. The PIM will reflect detailed internal control arrangements, including the extent of segregation of functions in payment processing and internal check mechanisms, in addition to payment approval and authorization arrangements. To enhance the project’s internal control arrangements, the internal audit units in all the implementing agencies will review project activities, in accordance with the Annual risk assessment and Internal Audit plan and submit reports to the project management team and to the World Bank during implementation support missions. 20. Financial reporting. The project implementing agencies will each prepare and submit quarterly interim financial reports (IFRs) to the World Bank within 45 days after the end of the quarter end. The interim financial reports will be used to monitor project financial progress, including the rate of budget execution and level of disbursements. Similarly, the respective agencies will prepare annual project financial statements, which will be submitted to external auditor within 45 days after the end of the fiscal year and audited financial statements to the World Bank within six months after the end of the fiscal year. Financial reports for each implementing entities holding designated accounts will at a minimum include sources and uses of funds (revenues and expenditures statement), financial position statement, cash flow statement, budget execution report; Designated Account activity statement for each designated account; notes on accounting policies and appendices. Experience from other projects implemented by the entities noted quality gaps. Training will be provided to avoid such risks in KLP. 21. External audit. The activities managed by the implementing agencies will be subject to external audit by the Office of the Auditor General (OAG) who has been auditing other World Bank funded projects implemented by the Government of Rwanda. Should the OAG seek to outsource the audit, the firm will need to be acceptable to IDA. The audit reports and management letters will be submitted to the World Bank within six months after the end of the financial year. The audit reports will be publicly disclosed in accordance with the World Bank Access to Information Policy. Upon receipt of the audit reports, each of the implementing agencies will prepare an action plan to address the audit findings. In other projects managed by RTDA, concerns were raised on value for money and for MINICOM a qualified opinion on financial statement due to unexplained differences noted on the financial statements. Both Page 36 implementers will closely monitor activities to avoid such irregularities. Follow-up on audit recommendation implementation will be conducted as part of regular World Bank implementation support missions and quarterly review of audited IFRs. 22. Funds flow arrangements. The project will maintain two segregated Designated Accounts for RTDA and MINICOM; these will be maintained at the National Bank of Rwanda and will be denominated in US dollars. The entities will maintain a Project Account at the National Bank of Rwanda denominated in Rwanda francs that will receive funds from the GoR for counterpart contribution and any transfer that may be needed from the DA. Disbursements will follow the Report based disbursement method whereby advances will be made based on two quarter forecasts to be prepared by the implementing entities. The project may also use direct payments, advances to the Designated Account, reimbursement and special commitments depending on the case. Upon effectiveness, the project will submit to the World Bank a request for withdrawal of funds based on the initial six-month expenditure forecast. Based on the request, the World Bank will transfer the proceeds of the loan to the two Designated Accounts. Subsequent replenishment of the Designated Accounts will be based on the submission of application of withdrawal accompanied by quarterly IFRs. The detailed modalities will be presented in the PIM and the Disbursement and Financial Information Letter (DFIL). The project has a CERC component and the most effective funds flow mechanism for CERC activities would be assessed and determined should this component be activated. FM Risk and Action Plan 23. The FM risk of the project is rated Moderate. The key risks identified are: (i) inadequate preparation of Annual and Work Plan and Budget (AWPB) could lead to irregularities in spending and accountability of resources; (ii) overstretching of existing finance personnel in the SPIUs which results from managing various projects; and (iii) delay in submission of quality financial reports and taking timely action on audit report findings. 24. Mitigating measures have been incorporated in the project design, including placing adequate staff at the two SPIUs under the implementing entities; provision of capacity building and training on World Bank-financed operations and using internal audit functions to assist in the timely action on audit report findings. The PIM will clarify the roles and responsibilities as well as the timelines for preparation of AWPB, reporting and auditing requirements. Action plan has been prepared which will help mitigate the identified risks and this will be monitored throughout project implementation. No. Action Timeline Responsibility 1 Prepare annual work plan and budget with clarity on Annually, March 31 All implementing components, categories, and financiers entities 2 Prepare FM section of the PIM to detail out internal Effectiveness All implementing control processes and roles and responsibilities of condition entities entities 3 Assign dedicated an accountant for RTDA Part of the All implementing Effectiveness entities condition 4 Enroll the project into IFMIS for proper recording of After effectiveness All implementing transactions entities 5 Internal audit to be conducted based on the risk As per the annual audit All implementing assessment of the project by the IA unit and share with plan entities the Bank the reports during supervision missions Page 37 6 Provide a plan for implementation of Within a month after All implementing recommendations of internal and external audit the receipt of the audit entities findings report 25. The risk assessment and on-site semiannual FM implementation support missions will be carried out. During these visits, follow-up will be made on internal and external audit reports and action taken thereon; transaction reviews and overall assessment of the adequacy of the FM systems will be carried out. Desk review of quarterly IFRs and annual audit reports will be conducted. Capacity building initiatives will be carried out at effectiveness and regularly thereon. E. Procurement 26. Procurement for the project will be carried out in accordance with the ‘World Bank Procurement Regulations for IPF Borrowers’, dated September 2023, hereafter referred to as ‘Procurement Regulations’. The project will be subject to the World Bank’s Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants (Anticorruption Guidelines), dated October 15, 2006, and revised in January 2011 and as of July 1, 2016, and beneficiary disclosure requirements. The project will use Systematic Tracking of Exchanges in Procurement (STEP). 27. Project Procurement Strategy for Development (PPSD), which looked at the market, procurement risks, procurement options and sets out the selection methods to be followed by the GoR for major activities during project implementation in the procurement of goods, works, and non- consulting and consulting services financed by the project, has been prepared by the recipient and reviewed by the Bank. The Procurement Plan is part of PPSD and includes procurement plans of the project, at least for the first 18 months and will be updated annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. 28. STEP: The project will use STEP, a planning and tracking system, which will provide data on procurement activities, establish benchmarks, monitor delays, and measure procurement performance. 29. E-Procurement system: Implementing agencies of the project, RTDA and MINICOM, will be using the Rwanda e-Procurement system (UMUCYO) for “post” procurement activities, in parallel with the World Bank STEP system. However, when the post review procurements are within international competitive threshold, the implementing agencies will advertise the procurement notices / request for expression of interest on UNDB and World Bank external site, in addition to UMUCYO. 30. Beneficial Ownership: Beneficial Ownership Disclosure is required for all new procurement advertised or invited on or after July 1, 2022, subject to open or limited international competition under all IPF projects, that are governed by the Procurement Regulations, and hence will apply to the project accordingly. 31. Procurement risk assessment. A procurement capacity and risk assessment has been carried out by the World Bank for both implementing agencies, to review the organizational structures and functions, experience, staff skills and capacity, procurement cycle management, quality, and adequacy of supporting and control systems and record keeping. Based on the assessment the following risks are identified: (a) Corruption, collusion, and Conflicts of interest, (b) Contract price increase due to inflation, currency instability, and interest rates, (c) Unexpected extreme weather, intense rainfall, and land slide, (d) Access and registration issues by bidders to UMUCYO e-procurement system, and (e) Limited skills for contract management under OPBRC. The current PIU structure of RTDA-SPIU and MINICOM-SPIU are adequate, save for one additional procurement staff need to be hired for MINICOM-SPIU. Page 38 32. The agreed mitigation measures for the identified risks are: (i) Improve the complaint management system, strengthen internal and external audits, and disclosure of information and procurement data to the public, (ii) Make sure provision for price adjustment is included in the contract document, (iii) Appropriate design and work plan by DB contractor and adequate design review and monitoring consultancy is put in place, (iv) RTDA will initiate discussion with RPPA E-GP unit to solve the access issue, and (v) Conduct intensive training on management of the OPBRC. 33. Project Procurement Risk Rate: Based on procurement assessment of the implementing agencies, market practice and nature of procurement activities of the project, the project’s procurement risk is rated Moderate. 34. Currently RTDA-SPIU has five experienced procurement staff. The number and competence of existing procurement staffs is adequate to manage additional procurements of the project. MINICOM- SPIU has two procurement staffs and one additional procurement specialist dedicated to the project will be hired. 35. The procurement profile of KLPConnect Project is mainly rehabilitation work of the roads connecting the KLP with the Nyanza-Ngoma (itself connected at Ngoma to the regional Central Corridor that is being paved with LVTP financing), the Rwanda Industrial Zone, the new Bugesera International Airport located some 25 km south of Kigali to enable the KLP better play its role. Other procurement activities are associated consultancy services and minor procurements of Goods and Non-Consultancy services. In general, the market soundness revealed that there are adequate number of suppliers, contractors and consultants participating in tenders, from Rwanda, the region, and international markets. 36. There is adequate procurement oversight mechanism in place within both RTDA and MINICOM. The internal audit unit at RTDA and MINICOM and Office of Auditor General (OAG) have an oversight role. The OAG conducts procurement auditing regularly on annual basis. 37. The assessment revealed that in general, the track record of procurement performance of the implementing agencies, RTDA-SPIU and MINICOM-SPIU are satisfactory. With hiring one additional procurement staff under MINICOM-SPIU, the existing procurement staffs of RTDA-SPIU and MINICOM- SPIU are adequate both in number and competence. 38. Preliminary procurement plan with list of procurable items with corresponding cost estimates, review types and selection methods will be output from the PPSD. The latest version of the World Bank’s standard procurement documents will be used for all procurements when approaching international market. 39. Use of recipient’s procurement procedures. The IAs will follow the World Bank Procurement Regulations as required by the Financing Agreement. When approaching the national market, recipient’s own procedures will be used as appropriate and as provided by the World Bank Procurement Regulations. When approaching the national market, RTDA and MINICOM will use the national standard procurement documents subject to review and acceptance by the World Bank by incorporating additional requirements provided in the World Bank (WB) Standard Procurement Document (SPD) for small works, and to make sure provision for application of the World Bank Anti-Corruption Guidelines and the World Bank’s right to audit and all ESF, climate, SEA/SH and ESHS requirements are included. 40. Procurement of Works, Goods and Non-Consultancy Services: For procurement of works, goods, and non-consultancy service contracts, IAs own procurement procedures and SBDs as agreed on and deemed satisfactory to the World Bank will be used, when approaching the national market. Page 39 Procurement while approaching the international market will be done using the latest version of the World Bank’s Standard Procurement Documents, and rated criteria will apply, except for procurement of Commodities, Vaccines, and Pharmaceuticals. Small value works, goods and non-consultancy service will be undertaken through request for quotation procedures. The request for quotation will indicate the specifications of works, goods, and non-consultancy service as well as the delivery/completion time and the contract award will be based on comparing price quotations from several qualified contractors/suppliers, with a minimum of three, to ensure competition. Direct contracting will be used where the PPSD informs so, is to the benefit of the project, and is in accordance with Procurement Regulations. 41. Procurement of consultancy services. Procurement methods to be used are as specified in the PPSD. Project staff required for the implementation will be hired following the World Bank Procurement Regulations for positions identified as consultant (IC) and following Project implementation Support Personnel, paragraph 7.32 of Procurement Regulations, for positions not identified as consultants (IC). Paragraph 7.32 of the Procurement Regulations applies to the project. All positions, whether identified as IC where Procurement Regulations are used, or project staff hired using agencies’ own procedure will be included in the procurement plan. The items to be identified as operating cost in the PPSD will be procured using the GoR’s procurement and administrative procedures subject to review and acceptable by the World Bank including selection of project implementation, non-professional, support personnel not identified as consultant (IC). 42. Record keeping. All records pertaining to award of tenders, including bid notification, register pertaining to sale and receipt of bids, bid opening minutes, bid evaluation reports and all correspondence pertaining to bid evaluation, communication sent to/with the World Bank in the process, bid securities, and approval of invitation/evaluation of bids will be retained by respective agencies and in electronic or hard copy and uploaded in STEP. 43. Disclosure of procurement information. The following documents will be disclosed on the agencies’ websites: (a) a Procurement Plan and updates; (b) an invitation for bids for goods and works for all contracts; (c) Request for Expression of Interest for selection/hiring of consulting services; (d) contract awards of goods, works, and non-consulting and consulting services; (e) a monthly financial and physical progress report of all contracts; and (f) an action taken report on the complaints received on a quarterly basis. 44. When using International Competitive Bidding (ICB), the following details will also be published in the United Nations Development Business and the World Bank’s external website : (a) an invitation for bids for procurement of goods and works following open international market approaches, (b) Request for Expression of Interest for selection of consulting services following open international market approaches, and (c) contract award details of all procurement of goods and works and selection of consultants using open international market approaches. 45. Fiduciary oversight by the World Bank. The World Bank will prior review contracts according to prior review thresholds set forth in the PPSD/Procurement Plan. All contracts not covered under prior review by the World Bank will be subject to post review during implementation support missions and/or special post review missions, including missions by consultants hired by the World Bank or third-party independent auditor delegated by the World Bank. To avoid doubts, the World Bank may conduct, at any time, independent procurement reviews of all the contracts financed under the loan. All procurement post reviews are carried out online in STEP. For this reason, uploading of procurement documents of post review contracts will be done in a timely manner and always kept up to date. Page 40 46. Contract Management. Increased contract management support through TA or reinforcing the contract management team using the project support component is necessary. Depending on interest by the government, the World Bank could examine request for use of Hands-On Expanded Implementation Support (HEIS) for high value high risk contracts. In addition, the implementing agency will develop key performance indicators (KPIs) for such contracts to be identified in the PPSD, and the KPIs will be monitored during actual execution of contracts. The World Bank will provide additional due diligence and independent review of the contract performance of such identified procurements. A fully staffed SPIUs will be responsible for the overall project. Page 41