Document of The World Bank FOR OFFICIAL USE' ONLY FiL E ,4 C0 Pax V Report No. 3131b-BT REPUBLIC OF BOTSWANA FIFTH ROAD PROJECT STAFF APPRAISAL REPORT November 20, 1980 Regional Projects Department Eastern Africa Regional Office 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 Currency Unit = Pula (P) and thebe P1 i US$1.2813 US$1.00 = P 0.7805 P1 = 100 thebe WEIGHTS AND MEASURES 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 miles (mi) 1 sq km (km2) 0.386 sq mi (mi2) GLOSSARY OF ABBREVIATIONS AfDB - African Development Bank AfDF - African Development Fund RD - Building Department CIDA - Canadian International Development Agency CTO - Central Transport Organization DC - District Council EDF - European Development Fund GTZ - Deutsche Gesellschaft fur Technische Zusammenarbeit ILO - International Labor Organization KfW - Kreditanstalt fur Wiederaufbau MFDP - Ministry of Finance and Development Planning MLGL - Ministry of Local Government and Lands MWC - Ministry of Works and Communications NORAD - Norwegian Agency for International Development ODA - British Overseas Development Administration RD - Roads Department RSA - Republic of South Africa RTC - Roads Training Center SIDA - Swedish International Development Authority USAID - United States Agency for International Development voc - vehicle operating costs vpd - vehicles per day Republic of Botswana Fiscal Year April 1 - March 31 FOR OFFICIAL USE ONLY REPUBLIC OF BOTSWANA FIFTH ROAD PROJECT STAFF APPRAISAL REPORT Table of Contents Page No. I. THE TRANSPORT SECTOR ....................................... 1 A. Geographic and Economic Setting ........................ 1 B. The Transport System ................................... 2 C. Transport Policy, Planning and Coordination .... ........ 3 D. Previous Bank Group Projects in the Highway Subsector .. 5 II. THE HIGHWAY SUBSECTOR ...................................... 7 A. The Network .............................. 7 B. Road Use. 8 C. Administration ............................ 10 D. Staff and Training .11 E. Planning and Financing .12 F. Engineering .14 G. Construction .15 H. Maintenance ........................ . .... 16 III. THE PROJECT .16 A. Background .16 B. Objectives .17 C. Description .17 D. Cost Estimates .22 E. Financing ...................................... 24 F. Implementation and Procurement .24 G. Disbursement .25 H. Accounting and Reporting Requirements .26 I. Environmental Aspects .................................. 26 This report was prepared by Messrs. K. Nathan (Engineer) and M. Le Blanc (Economist) who appraised the project in June 1980. The report was edited by Ms. P. Brereton. | 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. - ii - Page No. IV. PROJECT JUSTIFICATION .................................... 27 A. General .............................................. 27 B. Economic Evaluation .................................. 27 C. Risks ................................................ 34 V. AGREEMENTS REACHED AND RECOMMENDATION .................... 34 ANNEXES 1. Consultants- Terms of Reference for the Pavement Strengthening Program 2. Consultants' Terms of Reference for the Study of Road Design Standards 3. Project Progress and Reporting Requirements 4. Economic Evaluation of Project Roads 5. Related Documents and Data Available in Project File CHARTS 1. Ministry of Works and Communications Organization (World Bank 21846) 2. Roads Department Organization (World Bank 21845) 3. Project Implementation Schedule (World Bank 21873) MAP Botswana - Transport Network (IBRD 15120) REPUBLIC OF BOTSWANA FIFTH ROAD PROJECT STAFF APPRAISAL REPORT I. THE TRANSPORT SECTOR A. Geographic and Economic Setting 1.01 Landlocked Botswana is a large (570,000 km2), sparsely populated and mostly desert country (see Map), about the size of France or Kenya. Its access to the sea is through Durban, Cape Town and Port Elizabeth in South Africa and Beira and Maputo in Mozambique. The country-s topography does not present major obstacles to construction of transport facilities, but the scarcity of water and other construction materials, caused by widespread desert conditions, adversely affects road construction and maintenance. 1.02 The population, about 858,000, is growing at an annual rate of 3%. About 80% of the people live in the eastern 10% of the country where the Limpopo River system and more favorable rainfall provide opportunities for farming and where mineral deposits in exploitable quantities have been found. Even so, the average density there is only about nine persons per km2. The urban population, about 21% of the total, is expanding rapidly. -ain dwellers are concentrated in "he main business centers of Gaborone, Lobatse and Francistown and the mining town of Selebi Phikwe. These centers, along with the major traditional villages, lie within a 60-100 km belt ser- viced by the country-s only railway and the North-South road (para. 1.09). As a consequence of the settlement pattern, development of the transport system has been concentrated in the eastern corridor. 1.03 In the early period of rapid mineral development (diamonds, copper, nickel and coal) from 1971 to 1974, real GDP grew at an annual average rate of about 20%. It is currently expanding at a much lower rate of 8% p.a., but is expected to grow at a faster rate when the diamond mine at Jawaneng is opened in 1982 and other, mining developments take place. Per capita GNP in 1979 was an estimated US$725. 1.04 Agriculture and mining are the two leading sectors of the country s economy. Agricultural production has, however, been adversely affected by continued disorganization of the livestock market by foot-and-mouth disease and loss in staple crop production due to the drought during 1978/1979. - 2 - As a result, the contribution of agriculture to GDP declined from 40% in 1968 to 20% in 1978, while the contribution of the mining sector rose from 1% to 15% during the same period. Although agriculture is not expected to develop very rapidly in the future, Government programs to improve the rural economy under its National Development Plan (1979-85) will stimulate demand for better roads to serve the rural areas. Mining, which accounts for 70% of export earnings, will continue to be important to the economy, and the exploitation of proven mineral deposits will require considerable expansion of transport facilities. At present, however, low density freight and passenger flows and long distances mean that the cost of providing basic transport services to the population as a whole is high. B. The Transport System General Description 1.05 The transport system consists of a sparse network of roads and tracks, with the arterial North-South road running parallel to the railway line in the eastern corridor, and a considerable number of scattered airports and airstrips (see Map); a small ferry operates across the Zambesi River between Botswana and Zambia at Kazungula. Chapter II gives details of the roads subsector. The Railway 1.06 Built in the nineteenth century, the railway system traverses the 642 km length of eastern Botswana and links its two large trading partners, the Republic of South Africa (RSA) and Zimbabwe. It is owned, operated and maintained by Zimbabwe Railways, which pays Botswana an annual wayleave fee of Pula 350,000. Virtually all skilled and semi-skilled railway positions are held by Zimbabweans. In 1978/79, total railway traffic was 1,280 million ton-km, of which about 80% constituted transit traffic; rail passengers totalled about 600,000, of whom 10% were in transit. 1.07 The railway has increased in importance in recent years because of the traffic generated by mineral development and an increase in beef exports. Rail spurs from the main railway line to the mining towns of Selebi Phikwe (52 km) and Morupule (14 km) were financed by the Botswana Government in 1974 under the Shashe Infrastructure Project Loan (776-BT) for mineral trans- port, but even these are operated and maintained by Zimbabwe Railways. 1.08 Because the Government considers the railway vital to the economy, it has begun a three-phased program to take over that part of the rail system lying within Botswana. The program-s first phase consists of the establishment of an area headquarters in Francistown to carry out the administrative functions now centered in Zimbabwe. Under the second phase, the physical and organizational resources needed for internal as well as - 3- import and export operations would be acquired, while the third phase would complete any other required investments. The total cost of this project is estimated at US$83.6 million equivalent. 1.09 Although the North-South road runs parallel to the main railway line, there is little road-rail competition for freight haulage because the railway is primarily a link between RSA and Zimbabwe, while the road mainly serves internal traffic. At present, the railway is not well suited to serving internal traffic except for the transport of such bulk items as coal, cupro- nickel matte and petroleum, because the comparatively light traffic densities are more suited to road transport. Air Transport 1.10 Air transport facilities in Botswana consist of about 130 small airstrips and 4 airports (Gaborone, Francistown, Selebi Phikwe and Maun) which have scheduled services, although none is equipped to handle commercial jet or night flights. Two of Government's current planning objectives are the development of air transport to integrate widely scattered settlements into the economic and social life of the country and to reduce the country's dependence on Johannesburg airport in RSA for international connections. Financing for improvements to the internal air transport network has not yet been found, but Government has secured about US$42 million from external donors for the construction of an international airport at Gaborone, which is expected to begin in 1981. A new airport is necessary since the location of the existing airport does not permit the expansion required. Although the magnitude of the proposed airport, which would be able to accommodate 747 jets, does not seem iustified by projected traffic levels, it is in line with the Government's political objectives as reflected in its current transport policy (para. 1.12). 1.11 Air Botswana was established in 1972 as a profit-oriented parastatal organization wholly owned by the Botswana Development Corporation. It provides domestic and international services under subcontract with a private operator. Scheduled air services link Botswana with the RSA and Zambia. Approximately 178,000 passengers and 340 tons of freight were handled on scheduled air services in 1978/79. In recent years the financial situation of the subcontracted operator has deteriorated, and Government is considering alternatives to the present arrangement, including the formation of a national airline. Since it is doubtful whether a wholly national airline could be profitably operated, Government may also consider alternative operating arrangements. C. Transport Policy, Planning and Coordination 1.12 Botswana-s present transport policy as outlined in the Fifth National Development Plan (1979-85) aims at (a) upgrading the basic road network, (b) improving rural communications, (c) strengthening road maintenance and (d) reducing the country-s dependence on neighboring countries which own the railways, control air travel, and dominate the road transport industry. Substantial progress has been made on (a) and (c), and work is now under way to realize (b) and (d). 1.13 During the period 1975/76-1978/79 when the basic highway infrastructure was under construction, investment in the transport sector was high, averaging 34% of total investments made per year, with about 85% of all transport investments going to the highways subsector (see Table 1.1). Trans- port investments proposed under the current Development Plan would amount to about US$264 million or 30% of total planned investments. During this period, investments in roads would average about 60% of transport investments, while a large part of the proposed expenditures on other transport modes would go to the construction of the new Gaborone airport and the railway takeover. There is some doubt, however, whether Government will be able to carry out the proposed transport plan within the projected time frame, considering that it was able to implement only about half of all transport projects proposed for the period 1975/76 1978/79, which represented about US$84 million compared to the US$182 million proposed for the period 1979/80 - 1982/83. Table 1.1: Investment i the Transport Sector 1975/76-1982/83 (P million) Financial Year 1975/76 1976/77 1977/78 1978/79 1979/80 1980/8T1/ 1981/82!/ 1982/8 3 Transport 11.2 15.2 16.4 22.9 24.7 34.4 43.3 39.6 Roads 10.6 12.4 14.2 17.2 20.2 24.8 20.1 15.2 Total Investment 35.4 37.6 44.4 79.0 91.0 129.1 153.7 119.3 % of Total Invest- ment represented by Transport 32.0 40.0 37.0 29.0 27.0 27.0 28.0 33 O % of Transport Invest- ment represented by Roads 94.0 82.0 87.0 75.0 82.0 72.o 46.0 38,0 1/ Proposed. Source: National Development Plan, Central Statistics Office, MFDP, 1980. 1.14 The Ministry of Works and Communications (MWC) is responsible for transport planning, although it has little control over the Zimbabwe- owned railway. Within MWC, a Planning Unit was established in 1972 to prepare and update projects it proposes for inclusion in the National Development Plan. The unit is adequately staffed by three expatriate planning officers provided under bilateral assistance and two Batswanas who are seconded from the Ministry of Finance and Development Planning (MFDP) and work closely with the latter Ministry in project identification and preparation. In view of this association, once projects have been approved within MWC and sent to MFDP, they are usually included in the National Development Plan without much further review. 1.15 To date, much of the transport planning has been project-oriented with no long-range perspective and only limited intermodal or inter-sec- toral coordination. With consideration now being given to further expan- sion of the railway and air services and upgrading of the road network, the Government recognizes that more comprehensive planning will be necessary for future development and will soon appoint consultants to undertake a National Transport Study to assess the country-s transport needs over the next 15 years and to prepare an investment program based on economically-ranked priorities. The main objectives of the study are to identify ways to: (a) reduce Botswana-s high transport costs; (b) improve transport services in rural areas; (c) increase the benefits to Botswana of transit traffic; and (d) reduce the country-s dependence on transport services provided by other countries. The study is also to focus on the principal problem areas in the transport sector, such as cost recovery and intermodal coordination. In addition, based on a review of practices including tariff structures, systems of financing and private/public sector relations, it is expected to make recommendations for the general improvement and implementation of transport policies. Government ts reache? :-i agreement with the African Development Bank (AfDB) to finance the study out of savings on a previously financed road project and the study is expected to commence shortly. The Government also agreed to keep the Bank informed of progress and provide reports and results of the study when avail- able (para. 5.03). D. Previous Bank Group Projects in the Highway Subsector 1.16 The Bank Group has financed four road projects in Botswana and an infrastructure project with a road component. The First Road Project (Cr. 63-BEC, US$3.6 million), approved in 1964, provided for: (a) the design, construction and reconstruction of three roads totalling 570 kmin (b) selected betterment of the North-South road, and (c) improvement and expansion of the maintenance organization. The project was satisfactorily completed on time in 1968, within cost estimates; however, according to the Project Performance Audit Report (PPAR No. 115), projected economic benefits were not fully rea- lized in the six-year period following project completion because the fore- cast shift from cattle trekking to trucking did not take place due to livestock quarantine restrictions which made trekking of cattle more economic than trucking. The economic rate of return estimated at appraisal ranged from 8-20% for the various road sections, while the re-evaluated return for one road section was negative and for the other sections ranged from 4-16%. - 6 - 1.17 In 1972, Credit 303-BT for the Second Road Project was approved for US$2.0 million, with another US$4.0 million provided by the Swedish International Development Authority (SIDA). The project comprised: (a) the reconstruction and paving of the 80 km Pioneer Gate-Lobatse-Gaborone- Selebe section of the North-South road; (b) consulting services for detailed engineering and construction supervision; and (c) technical assistance to the Roads Department. These works were successfully completed ahead of schedule and within cost estimates, but the subsequent PPAR (No. 1550) concluded that, while the economic rate of return was satisfactory on two of the sections of the road, the return on the 8 km third section was about 4% due to a shortfall ln the development of traffic which occurred because the expected complementary investment in a connecting road in the RSA did not materialize. 1.18 The Third Road Project (Ln. 1174-BT, US$5.8 million), approved in 1975, was amended in 1978 to include additional project components in order to utilize surplus funds due to the low bid received for construction of the only project road. This occurred because at the time of project appraisal, there had been little construction of paved roads in Botswana, which made the preparation of accurate cost estimates difficult. The project, as amended, consists of: (a) construction of the Gaborone-Molepolole road (52 km); (b) consulting services for construction supervision, a Road Maintenance Study, detailed engineering of the Mahalapye-Serule road (150 km), and a feasibility study and detailed engineering of the Dumela-Ramokgwebana road (76 km); (c) a District Roads Maintenance Pilot Program; and (d) strengthening of the Roads Department (RD). The Gaborone-Molepolole road was completed satis- factorily in 1979, and only implementation of the District Roads Maintenance Pilot Program is not yet finished. The project is expected to be completed one year later than scheduled because of a delay in recruiting technical assistance staff with the appropriate expertise to implement the pilot program. 1.19 The Fourth Road Project (Ln. 1408-BT, US$20.0 million), approved in 1977, was amended in 1978 in order to utilize surplus funds as in the case of the Third Road Project. Although the appraisal estimate of construction costs was realistic, the lowest bidder for the main project road (Mahalapye- Serule) had the advantage of having just completed the construction of the Nata-Kazungula road and was able to significantly lower his bid price compared to other bidders. The project, as amended, consists of: (a) construction of the Mahalapye-Serule (150 km) and Gaborone-Tlokweng (17 km) roads; (b) con- sulting services for supervision of construction, detailed engineering of the Gaborone-Tlokweng road, feasibility studies and detailed engineering of Tuli Block roads, and preparation of a feeder road program; (c) technical assistance and equipment for road maintenance; and (d) strengthening of the Roads Department. The construction and studies components are proceeding satisfactorily close to schedule. The extension of the District Roads Mainte- nance Pilot Program has been postponed until completion of the pilot program under the Third Road Project. 1.20 In addition, the Bank loan for the Shashe Infrastructure Project (776-BT) included construction of the Serule-Selebi Phikwe road (52 km). Additional funds for bituminizing the road were included in a supplementary loan which brought the total cost of road construction to US$3.5 million. -7- Since completion of works in 1977, wide cracks have developed in the road surface due to the swelling of unsuitable material in the subgrade. These cracks are now being monitored and repaired by Government which is also considering a permanent solution to avoid further cracking. However, only a small part of the whole road is seriously affected. 1.21 For the most past, the Bank has concentrated on financing the physical works and equipment needed to improve RD's operations and training. Bilateral aid agencies have assumed responsibility for staffing and training instructors, usually at much lower costs to the Government than Bank loans. Significant progress has been made in the training of RD technicians, but localization of posts for technical officers and engineers has been slow because of the lack of candidates suitable for further training. II. THE HIGHWAY SUBSECTOR A. The Network 2.01 The officially gazetted road network totals about 6,900 km. As showr. in Table 2.1 below, about 62% of the network consists of earth and sand roads, about 23% of the roads have a gravel surface, and only about 15% are paved. Table 2.1: The Official Road Network, 1980 Bitumen Gravel Earth/Sand Total ------------------ (km) --- --------------- Main Roads 796 423 1,052 2,271 Main Feeder Roads 151 778 520 1,449 Secondary Roads 95 362 2,702 3,159 Total 1,042 1,563 4,274 6,879 Source: Roads Department, 1980. 2.02 The total gazetted road network was previously estimated to be about 7,500 km, but has been revised downward to reflect the loss of about 600 km of earth and sand roads which have virtually disappeared. In addition to the gazetted roads, there are several thousand kilometers of uninventoried District Roads which are mostly earth or sand tracks serving sparsely populated rural areas; these are administered by the District Councils. The eastern half of the country is well served by a developed road system, while the desolate western half depends for the most part on earth and sand tracks. The length of the present network is considered adequate for the population served, -8- but there is a continuing need to upgrade segments of the basic road network and connecting roads and to maintain the roads to satisfactory standards. 2.03 Since the country's independence in 1966, Government has made a significant effort to improve and develop the road system with the assistance of various bilateral and multilateral aid agencies. The gazetted road network has expanded from about 5,000 km in 1966 to about 6,900 km today, and the paved sections have increased from 26 km to over 1,000 km during the same period. Initially, emphasis was placed on the betterment and paving of main roads, but in recent years, particularly with assistance from the Norwegian Agency for International Development (NORAD) and the Bank, Govern- ment has been implementing a program of improving the rural road network and strengthening the capacity of the District Councils to improve and maintain the district roads. B. Road Use Vehicle Fleet 2.04 During 1973-1979, the registered -chiicle fleet increased from 8,357 to 21,827 vehicles (see Table 2.2), an libo average annual growth rate, excluding tractors, trailers, motorcycles, scooters and caravans. Most of the growth has been in the eastern districts in the towns of Gaborone, Francistown, Selebi Phikwe and Lobatse. The particularly striking growth of the fleet in 1974 is attributed to the very rapid development of the mining sector at that time and the cQnsequent stimulus to the country's overall economy. The rapid growth of the South African economy during this period also favorably influenced economic activity in Botswana. During the period 1977-79, total fuel consumption increased by 28%, with gasoline consumption increasing by 10% p.a. and diesel consumption by 15% p.a. This is in line with a 21% growth in the total vehicle fleet during the same period. Due to inaccuracies in the recording of data on light and heavy trucks since 1975, it is difficult to comment on whether the country is moving towards more efficient use of energy in motor transport. Table 2.2: Vehicle Fleet 1973-79-- X ~ ~ ~ ~~% x x of Light of Heavy of of of Change from Year Cars Total4 Goods_/4 Total Goods-/ Total Buses6/ TotaL Other3/ Total Total Preceding Yer 1973 2,277 27 2,375 29 1,783 21 99 1 1,823 22 8,357 9 1974 3,365 29 2,566 22 3,071 26 115 1 2,551 22 11,668 40 1975 3,614 27 5,198 39 1,345 10 124 1 3,099 23 13,380 15 1976 4,114 27 5,681 37 1,950 13 213 1 3,442 22 15,400 15 1977 3,319 19 7,225 40 3,489 20 239 1 3,625 20 17,897 16 1978 4,980 25 6,664 33 3,953 20 357 2 3,894 20 19,938 11 1979 5,612 26 6,839 31 4,717 22 483 2 4,176 19 21,827 9 1/ Figurea do not include government-owned vehicles (3,962 in 1979). 2/ Up to 1-1/2 tons. 3/ Includes tractora, trailers, motorcyclea and scooters and caravans. 4/ In 1975, new definitiona z. light and heavy goods vehicles resulted in substantial variations in these categories. 5/ Most passenger traffic is handled by the railway which serves the most populated areas of the country. Sou,tce: Reoublic of Botswana, Statistical Abstracts, 1973-77 and ministry of Works and Coraunications, 1QR0. -9- Traffic 2.05 RD, under MWC, is responsible for conducting traffic counts. These were infrequent and unreliable until 1976 when a Statistical Unit was estab- lished within MWC, with responsibility for traffic data collection. Transport statistics are now compiled annually by the Unit which put out its first sta- tistical bulletin in 1979, covering the period 1976-78. Based on these data and the findings of consultants working in the country, traffic levels have increased at an estimated average rate of 10% p.a. during the last decade, and by as much as 14% to 15% p.a. during the last few years. To a large ex- tent these rates reflect the underlying growth in the economy and can be attributed to factors such as higher levels of vehicle ownership and the general requirement for increased freight movements. 2.06 Recent traffic counts, carried out at about 40 regular counting stations, indicate that traffic volumes vary considerably throughout the coun- try according to region, but are low in overall terms because of the low popu- lation density. Traffic on main roads in southeastern Botswana ranges between 300 and 700 vehicles per day (vpd) and in the northeastern and western parts of the country between 35 and 250 vpd. Traffic on secondary and feeder roads is quite low with a maximum of about 50 vpd. Road Transport 2.07 Over the past four years, the number of licensed goods vehicles has been increasing by 15% p.a., and in 1979 about 11,500 such vehicles were licensed in Botswana. About 61% of the locally-licensed commercial vehicles are used in one man/one vehicle operations, and few operators have more than five vehicles. At present, the domestic road transport industry is still underdeveloped and has a high incidence of failures due to a lack of human resources with the required management and business expertise. Of approximately 1,900 operating permits issued in 1979 for the carriage of goods, fully two thirds were held by foreigners, mainly South Africans. Government is attempt- ing to reduce this dominance by requiring foreign carriers to demonstrate the need for their services and by giving priority to local carriers in issuing operating licenses. The Transport Control Division is also preparing a brief which will evaluate the impact of the foreign operators and provide recommen- dations on the type of assistance required to support Government's program of localization. Thereafter, appropriate policies and an investment program to promote the local transport industry will be determined by the National Transport Study (para. 1.15). 2.08 The Road Traffic Act of 1972, amended in 1974, governs vehicle weights and dimensions, and provides adequate legislation to protect the road system. It is enforced by the Transport Control Division and permits a maxi- mum single axle load of 8.2 tons, as in the RSA. Weighbridges and loadometers, financed under the Third Road Project, have been installed for enforcement of weight and dimension regulations, particularly of domestic traffic. Interna- tional traffic entering Botswana from Zimbabwe or the RSA is already well con- trolled by those countries. Government also controls entry into the road transport industry and vehicle licensing. Permits from the MWC Transportation - 10 - Secretary are necessary for either handling one's own goods or providing for-hire service. No control is exercised over freight rates, and consider- able competition exists among carriers. Road improvements have led to substan- tial freight rate reductions on those roads which have been improved. 2.09 Bus operators are required by law to charge one thebe per passenger- kilometer, and there is substantial compliance with this requirement. However, because this charge is not always adequate to ensure regular service, particu- larly on poorer roads, the Government must provide subsidies for service on the uneconomic routes. Government intends to review this matter in the proposed National Transport Study before deciding on the appropriateness of continuing these subsidies or the need to increase tariffs (para. 1.15). Road User Revenue 2.10 Road users contribute to Government revenues through taxes and duties on vehicles, fuel, lubricants, and spare parts, and through fees for licenses, registration, and road transport permits. Only the fees from licensing, registration and road transport permits, which contributed P 989,000 in 1979, are set and collected by the Botswana Government. All other taxes and duties on goods, including fuel, imported into the Southern African Customs Union area (Botswana, Lesotho, Swaziland, RSA) are paid into a common revenue pool. Although no specific data are available on the transport-related share of the revenues accruing to Botswana, Government believes that it is more than sufficient to cover the annual costs of main- taining the country-s road network. There is no basis to assess this. 2.11 In 1979 Government instituted a special fuel levy (currently 9.5 thebe/liter) which is paid into a fuel price stabilization fund administered by RSA. In 1979, the total amount collected under this levy was about P 13 million. The current pump price of gasoline in Gaborone is P 0.522 per liter (equivalent to US $2.46 per gallon) and that of diesel, P 0.487 per liter (equivalent to US $2.31 per gallon). These prices are comparable to those prevailing in the non-oil producing countries of Africa and western Europe. C. Administration 2.12 MWC (Chart 1) and the Ministry of Local Government and Lands (MLGL) share responsibility for the construction and maintenance of the country-s roads. RD (Chart 2), under MWC, executes works on the officially gazetted road network while the nine District Councils (DCs),under MLGL, are res- ponsible for all other public roads in their respective areas. The organi- zations of RD and the DCs with respect to road administration are satisfactory. However, due to a lack of qualified staff, the DCs depend for guidance and support on RD which has a District Roads Engineer on its staff to provide the necessary link with MLGL and the DCs. RD is headquartered at Gaborone and has divided the country into three regions for road maintenance purposes (para. 2.29). - 11 - 2.13 The present RD accounting system is not satisfactory and is in the process of being revised. While it can provide figures for financial control to avoid expenditures exceeding approved estimates, the system lacks procedures for collection of cost data for future planning and budgeting and for the evaluation of efficiency of road maintenance and force account works. In their Highway Maintenance Study, completed in 1978 under the Third Road Project, consultants, Kampsax/Sir Alexander Gibbs and Partners (Denmark/UK), recommended the establishment of a cost accounting system to remedy this deficiency. Although implementation of the proposed system was originally to be financed under the Fourth Road Project, the United States Agency for International Development (USAID) subsequently agreed to finance technical assistance and equipment to implement the Study s findings, including a cost accountant specialist to install modern bookkeeping and accounting equipment and to train RD staff in the operation of a sound accounting system. Work started in May 1980 and is expected to take about two years to complete. It is too early to comment on progress in improving the accounting system but it is expected that towards the end of 1980, with the establishment of a compu- terized system of data collection and processing, some improvements may occur in the data base for future planning and budgeting. 2.14 The Central Transport Organization (CTO) under the MWC is responsible for procuring, maintaining and repairing all civilian government equipment and vehicles which are allocated to user agencies, including RD. CTO operates full workshop facilities at Sebele (near Gaborone) and Francistown for equip- ment and at Gaborone for vehicles. Preventive maintenance and routine servicing are undertaken at workshops in Mahalapye, Kanye, Maun and Ghanzi for equipment, and in Francistown, Selebi Phikwe, Mahalapye, Lobatse, Maun, Ghanzi and Kasane for vehicles. During the past few years, CTO's organization and operations have been improved with the assistance of experts provided by the Canadian International Development Agency (CIDA), the British Overseas Development Administration (ODA) and USAID, who are also helping to train local personnel (para. 2.19). 2.15 In spite of the progress being made by CTO, the availability rate of equipment and vehicles is still low. To enable the Bank to monitor the progress made in improving CTO˝s operations, the Government has agreed to include, in its quarterly reports to the Bank (para. 3.30), an updated inventory of RD equipment and vehicles together with information on the operational status of each item (para. 5.03). D. Staff and Training 2.16 RD is staffed and managed for the most part by expatriates financed by a number of bilateral aid agencies. Out of 14 engineers in RD, only one is a Batswana, although the situation of technical officers is slightly better, - 12 - with about 4 out of 25 posts held by Batswanas who also occupy all the posi- tions for technicians. At present, 22 out of 111 posts for engineers and technicians are vacant, but most of the vacancies are in posts for mid- and low-level technicians and are expected to be filled by graduates of the Roads Training Center (para. 2.18). 2.17 RD's heavy dependence on expatriates is not likely to change significantly during the 1980s. Although Government has made available a number of scholarships for university courses in civil engineering, any suitably qualified candidates are usually channeled into the education, agriculture, health and mining sectors, to which Government has given prio- rity. No candidate is currently available for training as an engineer for RD, but measures to provide more qualified candidates for this training are now underway. With the assistance of the Bank-s Second Education Project (Ln. 1828-BT), Government has begun a program to improve the teaching of science and mathematics in selected secondary schools in order to prepare a greater number of students for further technical training. Provided that Government fulfills its undertaking to insure an adequate number of science and mathematics teachers, it is expected that such efforts will eventually provide Government with a greater number of civil engineers and thus decrease the present dependence on expatrI.%Leb. 2.18 The training of road technicians, road supervisors and equipment operators is carried out by the Roads Training Center (RTC), which provides a 3-year Road Technician's Course, a 2-year Road Supervisor-s Course and a 16-week Equipment Operator's Course held three times a year. The quality of RTC courses has suffered from a lack of adequate facilities and insufficient training staff. With the assistance of the Fourth Road Project, the lack of facilities has been corrected by the construction of a new school building for the RTC and the provision of training aids and equipment. Under the proposed project, the school's training staff is to be strengthened by the recruitment of two instructors (para. 3.19). The new school can accommodate 20 students each for the road technician's and supervisor's courses and 18 students for the equipment operator-s course. This is considered adequate to meet the projected needs of RD for at least ten years. 2.19 CTO operations have been improved significantly by six staff members, including the General Manager, financed by CIDA. USAID has also provided two mechanical instructors and ODA, one Training and Organization Specialist. CIDA is expected to continue its program of technical assistance until 1986 when local counterparts will have been adequately trained to take over opera- tions. CTO's facilities for training mechanics have been improved, and this training will continue with local instructors on the departure of the expa- triate technical assistance personnel. E. Planning and Financing 2.20 Road projects are selected and evaluated by the MWC Planning Unit and the RD prior to review by the MFDP (para. 1.14) but because of the staff constraints. major feasibility studies are carried out by consultants. The - 13 - Planning Unit is currently preparing to undertake a National Transport Study with the help of consultants to define the investment needs of the entire sector over the next 15 years (para. 1.15). 2.21 Government's current road development plans in the National Development Plan for 1979-1985 include completion of the all-weather North- South road, creation of a more effective maintenance organization and develop- ment of a local road construction industry. The plan also proposes an in- crease of 520 km in the paved road network by 1985. Proposed investments and their funding during the planning period are summarized in Table 2.3. Table 2.3: Proposed Investments in Roads 1979-1985 External Agency Total Project Description km Involved (P million) 1. Lobatse-Ramathlabama 48 EDF 5.00 2. Mahalapye-Serule 150 IBRD 8.00 3. Serule-Dumela 97 KfW 3.15 4. Dumela-Zimbabwe Border 76 IBRD 8.00 5. Kanye-Lobatse 45 AfDF 3.50 6. Gaborone-Molepolole 52 IBRD O.89 7. Gaborone-Tlokweng 17 IBRD 0.90 8. Palapye-Serowe 51 KfW 5.50 9. Nata-Kazungula 300 USAID/EDF 16.50 10. Jawaneng-Ghanzi 576 10.85 11. Francistown-Nata 188 CIDA/DANIDA/NORAD 2.80 12. Orapa-Francistown 228 9.50 13. Nata-Maun 306 10.50 14. Road Depots - IBRD 0.22 15. Road Maintenance (capital costs)./ C IDA/USAID/ODA 5.02 16. Rural Roads Program - NORAD 13.60 17. Tuli Block Roads 100 IBRD 10.20 18. Traffic data collection - IBRD 0.05 19. Major roads through villages 46 0.11 20. Secondary roads improvement - ODA 7.45 21. Soils Laboratory IBRD 0.25 22. Roads Training Center - IBRD 0.65 Total 2,280 122.64 (US$157 million equivalent) 1/ USAID financinlg equipment and technical assistance for which provisions were made in Loan 1408-BT. Source: Ministry of Works and Communications, 1980. - 14 - While the program represents an ambitious undertaking, most of the necessary external funding has been secured and many of the projects are already underway. Of the total amount indicated above, Government expects to contri- bute about 25%. The proposed Bank loan would finance four of the projects specified in the Plan: construction of the Dumela-Zimbabwe border road, improvement of roads in the Tuli Block area, and construction of road depots and a Soils Laboratory building (paras. 3.04-3.14). 2.22 Recurrent expenditures for roads are financed from the Government's general budget, while new construction is covered by the development budget which is largely financed by external grants and loans. Expenditures for construction have averaged about US$14.6 million equivalent annually over the past three years, while MWC's maintenance expenditures have averaged US$750,000 (Table 2.4). Although maintenance funds should be increased in the future to meet the needs of the rapidly expanding network, this is not expected to be a problem since allocations for road maintenance have to date been adequate (para. 2.30). Table 2.4: Annual Highway Expenditures 1977/78-1979/80 (P million) Maintenance!/ Construction Total US$ Equivalent 1977/78 394 12,407 12,801 16.4 1978/79 487 14,157 14,644 18.7 1979/80 886 17,204 18,090 23.1 1/ Does not include operating costs of road maintenance equipment, which are included in the CTO budget (see para. 2.30). Source: Ministry of Works and Communications, 1980. F. Engineering 2.23 RD has a design section headed by a Senior Roads Engineer (Design), but due to lack of support staff, it has capacity to undertake only a limited amount of work,mainly to provide in-house training for RD technicians. The main function of the design section is to supervise the work of expatriate consultants who carry out most of the detailed engineering, including document- ation for new works, particularly for the paving of main roads. The RD policy of awarding consultancy contracts only to consultants with offices established in the country has tended to reduce the costs of these services. However, since this policy benefits only consultants from two or three countries, and the quality of services may suffer through lack of competition, Government has been advised to consider consultants from a wider sampling of countries in the case of Bank-financed projects. - 15 - 2.24 Design standards vary according to the consultant engaged to carry out the engineering studies for a particular road, but generally conform to minimum road design criteria set down by the RD. To assure the adequacy of these standards, RD will appoint consultants to study and make recommend- ations on design standards appropriate for the country, and provision has been made for this under the proposed project (para. 3.17). 2.25 RD's laboratory for soils and materials testing is presently housed in a building shared with the Meteorological Department. Although laboratory equipment has been gradually improved, most recently with Bank assistance under the Third Road Project, the space available is inadequate to carry out the increased workload and has made it necessary for RD to depend on consul- tants for testing services. Provision has therefore been made in the proposed project for the construction of a new laboratory building (para. 3.11). G. Construction 2.26 All major road works are carried out by foreign contractors. Contracts are normally let after competitive bidding based on priced bills of quantities and are supervised by consultants. RD has a Direct Labor Branch for force account work, which has mainly been limited to construction of earth and gravel roads in rural areas, with technical assistance and equip- ment financed by NORAD. Following a recent decision by NORAD to pave these roads, the Direct Labor Branch is undertaking some bituminous surface treat- ment work. Performance of the Branch is satisfactory. The local contracting industry concentrates almost totally on building construction, and any signi- ficant participation in road construction will depend on further development of local technical and managerial skills, which is now being done under Bank-financed education projects and schemes organized by other agencies like UNIDO. 2.27 Despite Government-s policy to develop employment opportunities for labor, construction is mainly equipment-intensive due to the scarcity of labor arising from the migratory habits of the rural population and the great distances between population centers. This situiation is currently being addressed under a District Roads Pilot Project which was included in the Third Road Project. A team of experts from the International Labor Organization (ILO) has been engaged: (a) to identify and make recommenda- tions toward solving the problem of labor availability in a country with growing unemployment in the towns and underemployment in rural areas; and (b) to test labor-intensive methods for the construction and maintenance of roads administered by one District Council. The full team did not assemble until June 1980. Work is proceeding satisfactorily, but it is too early for any significant conclusions to be reached. The experience gained from operations in the pilot district will be used in extending the program to two additional districts under the Fourth Road Project. - 16 - H. Maintenance 2.28 The organization and management of road maintenance have improved significantly within the last two years since the completion in 1978 of the Highway Maintenance Study financed under the Third Road Project (para. 2.13). The study recommended a 5-year Road Maintenance Program for trunk roads which would provide adequate staffing and training for the RD Maintenance Branch, strengthen the equipment fleet, improve workshop facilities and spare parts supplies, and implement efficient methods of executing maintenance tasks and accounting. The Maintenance Program is now being implemented by Government, with assistance from USAID which is financing a five-man technical assistance team, the procurement of equipment and spare parts, and scholarships for technical training in the U.S. for key road maintenance personnel. The program is progressing satisfactorily. The Maintenance Study also proposed the District Roads Pilot Project for the betterment and maintenance of low stan- dard district roads which is now underway with Bank financing (para. 2.27). 2.29 As shown in Chart 2, the country is divided into three regions for maintenance, with a senior road maintenance engineer for each region, while an additional senior engineer at headquarters in Gaborone administers road maintenance contracts. Maintenance groups operate out of base depots at Gaborone, Francistown and Maun and six district depots. The depots will be improved under the project (paras. 3.13-3.14). 2.30 Funding for road maintenance seems to be adequate, but this is difficult to confirm because the operating costs of road maintenance equipment come under CTO's budget, which fails to show separate budgetary allocations for its various user agencies or to keep separate accounts for the operating costs of the agencies- equipment. These issues are expected to be resolved by the reorganization of the accounting and budgeting procedures of both RD and CTO, which is currently being undertaken with the help of technical assistance financed by USAID and CIDA, respectively. III. THE PROJECT A. Background 3.01 The project has been identified from the following studies carried out by consultants: (a) feasibility study for the Dumela-Ramokgwebana road by Brian Colquhoun and Partners (UK/South Africa) (1979); and (b) technical and economic feasibility of roads in the Tuli Block and the adjacent traditional areas by TAMS/NZA Group consultants (USA/UK/Botswana) (1979). - 17 - The Highway Maintenance Study (1978) carried out by consultants, Kampsax/ Sir Alexander Gibb and Partners (Denmark/UK),is the basis for including soils and materials testing and road maintenance facilities under the project. The three studies were financed by the Bank under the Third and Fourth Road Projects. B. Objectives 3.02 The project's objectives are to support specific goals of Botswana's National Development Plan for 1979-1985 which calls for the upgrading of the basic road network, encouraging rural development and strengthening road maintenance. Specifically, the project will: (a) complete the paving of an extension of the North-South road to link with newly independent Zimbabwe; (b) improve road access in arable portions of the Tuli Block and adjacent areas; and (c) strengthen the RD by constructing facilities for soils and materials testing and road maintenance depots and by provid- ing a variety of consulting services and instructors for RTC. C. Description 3.03 The project consists of: (a) construction to bituminous paved standards of the following roads: (i) Dumela-Zimbabwe border road (76 km); and (ii) Selebi Phikwe-Sefophe road (25 km) and a 7 km access road to the Selebi Phikwe airport serving the Tuli Block area; (b) spot improvements of the Sefophe-Tsetsebjwe (56 km) and Dikabeya-Sefophe (93 km) roads in the Tuli Block and adjacent areas; (c) construction of a building for the RD Soils and Materials Laboratory and nine Road Maintenance Depots; (d) consulting services for: (i) construction supervision of (a), (b) and (c); (ii) preparation of a pavement strengthening program for about 80 km of main roads and training RD staff in pavement evaluation; - 18 - (iii) determination of appropriate road design standards for Botswana and preparation of an RD design manual; (iv) technical assistance to RD; and (e) the recruitment of two instructors to strengthen the RTC training staff. (a) Construction of Paved Roads Dumela-Zimbabwe Border Road (76 km) 3.04 This is an extension of the North-South road which is being paved progressively with the assistance of various bilateral agencies and the Bank under the Fourth Road Project. The section included under the proposed project commences at Dumela, about 11 km north of Francistown the main distri- bution center for northern Botswana, and crosses predominantly flat terrain to Plumtree on the Zimbabwe border. Although the alignment requires only minor adjustments, the road has a generally depressed grade line and an earth to gravel surface of variable quality. As a result, the road is difficult to pass during the rainy season and is barely adequate during the dry season. 3.05 With the border restrictions lifted in March 1980 following Zimbabwe's independence, traffic at the border increased from 16 vpd to 75 vpd within about two months and by 1983, when the new road would open, is expected to reach 115 vpd at the border and 225 vpd near Dumela. The new road will have a double bituminous treated surface and will be designed to the standards given in Table 3.1, which are appropriate for the predicted traffic and are acceptable. Detailed engineering of the road by consultants, John Burrow and Partners (UK), commenced in February 1980 and the work, including final cost estimates and documentation for International Competitive Bidding (ICB), was completed satisfactorily in October 1980. Table 3.1: Design Standards of Project Roads Dumela/Zimbabwe Border Road and Access Road to Selebi Phikwe/ Selebi Phikwe Airport Sefophe Road Design Speed (kph) 120 120 Carriageway Width (m) 6.7 6.0 Shoulder Width (m) 2.0 1.5 Maximum Gradient (%) 5 5 Minimum Horizontal Radius (m) 820 820 Maximum Superelevation (%) 5 5 Minimum Stopping Sight Distance (m) 205 205 Road Reserve (m) 61 61 Pavement Design Based on maximum single- Based on maximum axled load of 8.2 tons single-axled load using the British TRRL of 8.2 tons using Road Note 31. the South African TRH4. - 19 - Selebi Phikwe-Sefophe Road (25 km) and Access Road to the Selebi Phikwe Airport (7 km) 3.06 This road serves the important mining town of Selebi Phikwe and is an extension of the Serule-Selebi Phikwe road (64 km), which was cons- tructed in 1977 to paved standards under the Shashe Infrastructure Project (Ln. 776-BT). At present, it is an earth road for about 14 km and thereafter a track cleared through the bush. Current traffic on the road is about 100 vpd. Because maintenance of gravel roads in this area is relatively expensive and difficult to organize due to the frequent need for watering and grading and constant supervision, the new road will have a single bituminous-treated surface and will be designed to the standards given in Table 3.1, which are appropriate for the predicted traffic and are acceptable. 3.07 An international airport was recently opened at Selebi Phikwe to provide flights to Johannesburg and various domestic services. The 7 km access road serving the airport also provides a link between the two mines in Selebi Phikwe and carries buses transporting mine workers. Traffic on the road is now relatively high at about 175 vpd, and upgrading the road to paved standard is justified. 3.08 Detailed engineering of the roads by consultants, TAMS/NZA (USA/UK/ Botswana), commenced in January 1980 and the work, including final cost esti- mates and documentation for ICB, was completed satisfactorily in October 1980. (b) Spot Improvements of the Sefophe-Tsetsebjwe (56 km) and Dikabeya- Sefophe (93 km) Roads 3.09 In their feasibility studies of roads in the Tuli Block and adjacent tribal areas, consultants found that several hundred kilometers of roads required spot improvements in order to make the roads serviceable throughout most of the year. The two roads selected for improvement under the project serve tribal farming areas and meet at Sefophe on the Selebi Phikwe-Sefophe road which would be paved under the project (para. 3.06). 3.10 Current traffic on the two roads varies between 24 and 37 vpd depending on the road section. The existing roads are earth tracks with surface widths of about 4.0 m on flat country and have good horizontal align- ments. The surface is generally sound except for some sections which are somewhat potholed or rutted or reduced in width by erosion. The roads are easily traversable during the dry season, but during rainy periods water flows on the road bed because of lack of adequate ditches and drainage structures. The spot improvements will be primarily directed to the improvement of drainage, shaping and grading, and the provision of minor structures at the most seriously affected sections to enable trucks to pass during all but the heaviest rains. - 20 - (c) Construction of Buildings RD Soils and Materials Laboratory 3.11 As mentioned in para. 2.25, RD's existing facilities for soils and materials testing are already inadequate and will become even more of a constraint in the future. Of particular concern is the need to test bituminous materials and to identify additional sources of road-making mate- rials which will be required for the spot improvement program planned for the entire road network. 3.12 The project therefore includes the construction of a building to house the RD Soils and Materials Laboratory adjacent to RTC's new school building. This will provide RTC-s students with access to facilities for training in soils and materials testing. Plans and cost estimates for the laboratory building were prepared by RD with assistance from the MWC Building Department (BD) and are satisfactory. The building would be a simple single-storey structure constructed of concrete blocks and standard steel trusses similar to the RTC building. Road Maintenance Depots 3.13 A 5-year Road Maintenance Program is currently being implemented by Government with the assistance of USAID which is financing technical assistance and road maintenance equipment including spare parts (para. 2.28). The technical assistance team recently started work, and the bulk of the equipment and spare parts is expected to be delivered by the end of the year. The agreement with USAID, signed in August 1979, calls for the provision of storage space for spare parts in RD's road maintenance depots in order to ensure adequate maintenance of the USAID-financed equipment. In addition, the Highway Maintenance Study recommended the establishment of servicing facili- ties for road maintenance equipment and vehicles in selected roads maintenance depots. The Government has therefore prepared a program for the construction of a new base depot at Gaborone and a new district depot at Kang and the enlargement of the existing two base depots at Francistown and Maun and of the five district depots at Kanye, Mahalapye, Palapye, Nata and Ghanzi. 3.14 Plans and cost estimates for the construction and enlargement of the nine road maintenance depots have been prepared by RD with assistance from BD and are satisfactory. All the depots will be simple single storey structures constructed of concrete blocks and standard timber trusses. (d) Consulting Services Supervision of Construction 3.15 Consultants will supervise all civil works. Although the Government will consider engaging the consultants currently completing detailed engineer- ing of the project roads, it prefers to reserve its right to select new con- sultants, if desirable. Construction supervision of the buildings would be carried out by the BD of MWC with a little assistance from consultants whose costs are expected to be very small. - 21 - Pavement Strengthening Program 3.16 One of the earliest roads to be paved in Botswana is the Sebele- Gaborone-Lobatse-Pioneer Gate road (80 km), which was paved in 1974 with assistance from IDA and SIDA under the Second Road Project. During the past two years, traffic has grown faster than assumed in the original design for the road, and the designed strength of 220,000 cumulative single axle loads of 8.2 tons is expected to be reached within the next two years. In order to prevent possible road failures of this and other roads, Government has re- quested assistance in planning a pavement strengthening program. The project therefore provides for consulting services to: (i) carry out deflection tests of the pavement; (ii) determine its residual life; (iii) determine the appro- priate time and period for which the pavement has to be strengthened, and (iv) design asphalt overlays to strengthen the pavement, based on traffic data which would be supplied by RD. Opportunity will also be taken to train a small group of RD technicians in pavement evaluation techniques. Although priority will be given in the proposed study to the above road, the Bank agreed to consider the inclusion of other roads identified by the Govern- ment as requiring strengthening in the near future, although the program will still cover only 80 km of main roads. Outline terms of reference for the consultants are given in Annex 1 and have been agreed with Government. Manual for Road Design Standards 3.17 Government is concerned about the variety of design standards recommended by consultants employed for detailed engineering of roads. In particular, South African and UK pavement design methods are indifferently selected, without due regard to their comparative merits in Botswana. Govern- ment has also recognized the need to review RD-s existing road design stan- dards and to produce a design manual for RD staff which would take into account (i) the varying and unusual soil conditions and scarcity of water in the country and (ii) labor-intensive techniques in road construction. To meet these needs, as well as Government's objective of strengthening RD to carry out detailed engineering for some roads, the project provides for consultant services to investigate appropriate design standards for the country and to prepare an RD Design Manual. Since a great deal of information on this subject is available from local and South African sources, only a desk study is envisaged. Outline terms of reference for this work are given in Annex 2 and have been agreed with Government. - 22 - Technical Assistance to RD 3.18 As described in para. 2.16, RD is staffed at the professional and mid-professional levels almost entirely by expatriates who are usually appointed under arrangements with various bilateral aid agencies. From time to time vacancies occur which cannot be filled immediately because of delays in recruitment of suitable candidates or in renewal of agreements with the aid agencies. The Government has also imposed a manpower ceiling for the current financial year and is limiting staff growth to 5% p.a. As a result, RD is faced with an occasional need for temporary staff, which is provided for under the proposed loan with a notional sum of US$160,000 to finance tempo- rary staff who can be provided at short notice by consulting firms with local offices. (e) RTC Instructors 3.19 The present RTC staff consists of a Senior Training Engineer, two civil engineering instructors and an equipment instructor, all provided under bilateral assistance, and four Batswana instructor trainees who help with the equipment operator s course. Due to the shortage of staff, the quality of the courses has suffered, and the teaching of basic subjects like mathematics and physics has been particularly affected. Government has established two additional posts of instructors for RTC and is currently taking steps to recruit qualified candidates to fill them. The provision of the two instructors for a 27-month period has been included in the proposed project. To ensure the optimal use of the new RTC facilities and the effec- tiveness of courses to begin in September 1981, the Government has agreed that not later than June 30, 1981, it will appoint the two additional instructors to the RTC. Thereafter, the teaching staff of RTC consisting of a Senior Training Engineer and five instructors will be maintained until the Government and the Bank should otherwise agree (para. 5.01 (a)). D. Cost Estimates 3.20 The total project cost, including price and physical contingencies, is estimated to be US$25.0 million with a foreign exchange cost of US$17.6 million or 70%. Total cost net of taxes and duties which amount to about US$2.0 million or 8% is US$23.0 million. Since prices in Botswana are heavily influenced by the costs of imports, price escalation rates have been assumed to be the same for both local and foreign costs. Price escalation in 1980 and 1981 is expected to be 14% p.a. for all items. Thereafter, it is projected to decline to 12% p.a. A summary of project costs is given in Table 3.2 on the following page. 3.21 Cost estimates for the Dumela-Zimbabwe border road and the Selebi Phikwe-Sefophe road were prepared by consultants who carried out detailed engineering. Final engineering quantities were used in the calculation of cost estimates for both the roads, which were based on the assumption that works would be carried out by foreign contractors. Estimates of contract unit prices were based on bid prices on recent contracts awarded by the Government. The estimated average construction cost per km (including contingencies) is - 23 - Table 3.2: Project Cmposition and Cos Estimates Foreign Exchange Local FSoeign Total Local Foreign Total Component .(Pulas million)--_--- -- mi o) 1. CIVIL WORYS (ROADS) A. Construction to bituminous paved standards: (i) Dumela-Zimbabwe Border Road (76 km) 2.88 6.72 9.60 3.69 8.61 12.30 70 (ii) Selebi Phikwe-Sefophe Road (25 km) 0.66 1.53 2.19 0.84 1.97 2.81 70 (iii) Access Road to Selebi Phikwe Airport (7 km) 0.15 0.36 0.51 0.20 0,45 0.65 70 B. Spot Improvements: (1) Sefophe-Tseteebjwe Road (56 km) 0.07 0.16 0.23 0.09 0.20 0.29 70 (ii) Dikabeya-Sefophe Road (93 km) 0.04 0.09 0.13 0.05 0.11 0.16 70 Sub-total 3.80 8.86 12.66 4.87 11.34 16.21 70 II. CIVIL WORFS (BUILDINGS) A. Construction of an ED Soils Laboratory 0.18 0.27 0.45 0.23 0.35 0.58 60 B. Construction and enlargement of 9 Road Maintenance Depots 0.19 0.28 0.47 0.24 An36 0 60 Sub-total 0.37 0.55 0 0.47 0.78 1 18 60 Sub-total (I & II) 4.17 9.41 13.58 5.34 12.05 17.39 74 III. CONSULTII3 SERVICES A. Construction Supervision of (I) 0.20 0.78 0.98 0.25 1.00 1.25 80 B. Construction Supervision of (II) - 0.01 0.01 - 0.01 0.01 80 C. Preparation of a pavement strengthening program and training RD staff in pavement evaluation 0.02 0.07 0.09 0.02 0.09 0.11 80 D. Study of appropriate design standards for Botswana 0.02 0.07 0.09 0.02 0.09 0.11 80 E. Technical Assistance to RD 0.03 0.13 0.16 0.04 0.16 0.20 80 Sub-total 0.27 1.06 1.33 0.33 1.35 1.68 80 IV. RTC INSTRUCTORSI' 0.06 0.25 0,31 0.08 0.32 0.40 80 Base Cost (January 1981) 4.50 10.72 15.22 5.75 13.72 19.47 70 V. CONTIOGENCIES A. Physical (10%) 0.45 1.07 1.52 0.58 1.38 1.96 70 B. Price (18Z) 0.81 1.93 2.74 1.07 2.50 3.57 70 Sub-total 1.26 3 00 4 26 1.65 3.88 5.53 70 TOTAL 5.76 13.72 19.48 7.40 17.60 25.00 70 TOTAL (excluding Taxes and Duties) 4 20 13 72 17 92 5.40 17.60 23. n 76 1. To be financed by Goveronmnt or with assistance from a bilateral aid agency. November 1480 - 24 - about US$187,000. There are no right-of-way costs as the road alignments do not affect improvement on land (building, crops, etc.) for which compensation is required under the law. 3.22 Spot improvement costs were derived by consultants from feasibility study cost estimates, which were based on road inventories taken during the studies. The estimated average cost of spot improvements per km (including contingencies) is about US$3,900. The improvements would be carried out on the basis of visual observation and the judgement of the supervising consul- tants since the cost of detailed engineering is not justified by the type and scale of the civil works involved. 3.23 Consulting services included in the project will involve a total of 244 man-months of work comprising 174 man-months for supervision of con- struction of roads and buildings, 30 man-months for technical assistance to RD and 40 man-months to prepare the pavement strengthening program and road design manual. The estimated total costs (including contingencies) are US$1,600,000, US$240,000 and US$280,100, respectively. The average man-month cost, including salary costs, fees, international travel and local subsistence is estimated at about US$6,900. In addition to these personnel costs, the consultants- contract costs include the costs of local transportation, local office operating expenses and some other miscellaneous minor expenses. E. Financing 3.24 The project cost net of taxes and duties is US$23.0 million equivalent. The Bank loan will finance US$17.0 million equivalent of the foreign cost estimated to be US$17.6 million (about 76% of the total cost). The Government will finance US$0.6 million equivalent of the foreign cost with assistance expected from a bilateral aid agency and all local costs of US$5.4 million equivalent. Government has confirmed these financing arrangements (para. 5.03). F. Implementation and Procurement 3.25 RD will be responsible for the execution of the project, which will be carried out over a three-year period beginning April 1, 1981. An implementation schedule (Chart 3) has been agreed with the Government (para. 5.02). - 25 - 3.26 Road construction, estimated to cost about US$20.0 million, will be executed under two unit price contracts awarded after ICB in accordance with Bank Guidelines for Procurement (para. 5.01 (b)). The spot improvement works on the Dikabeya-Sefophe and Sefophe-Tsetsebjwe roads will be included in the bid package for construction of the Selebi Phikwe-Sefophe road, and bidders for this road will be required to also quote rates for the execution of the various items of the improvement works at the same time. The total amount involved is not expected to exceed about US$0.6 million. 3.27 Because of the small scope and scattered location of works, contracts for the construction of the RD Soils and Materials Laboratory and the nine road maintenance depots, estimated to cost about US$1.5 million, will be awarded after ICB, but publication of the invitation to bid will be limited to advertising in the local press, informing the few local repre- sentatives of Bank member countries and publishing an announcement in the Development Forum. Works will be divided into ten contracts (one for each building), and b.ds will be invited for one or more contracts. Bids are expected from local contractors, including one or two Botswana contractors, expatriate-owned local firms and contractors from Zimbabwe and the RSA; works are not likely to attract other foreign contractors. Agreement to this effect was reached with Government (para. 5.01 (c)). 3.28 Consultants will be employed to supervise all civil works, including building construction; prepare a pavement strengthening program; prepare a design manual for RD after determining road design standards appropriate to conditions in Botswana; and provide technical assistance to RD. This is expected to cost a total of about US$1.9 million. Consultants' outline terms of reference and conditions of employment have been agreed with Government (para. 5.01 (d)). E. Disbursement 3.29 It is proposed that loan funds be disbursed on the following basis: (a) 70% of total costs of civil works for the roads; (b) 60% of total costs of civil works for the buildings; and (c) 80% of total expenditures for consulting services. All disbursements will be fully documented. The esti- mated schedule of disbursements is given in Table 3.4. - 26 - Table 3.4: Estimated Schedule of Disbursements Bank Fiscal Year and Quarter Cumulative Disbursements Ending at End of Period (US$ Millions) 1982 December 31, 1981 1.6 March 31, 1982 3.2 June 30, 1982 5.9 1983 September 30, 1982 7.7 December 31, 1982 9.5 March 31, 1983 11.3 June 30, 1983 13.1 1984 September 30, 1983 14.9 December 31, 1983 16.3 March 31, 1984 17.0 H. Accounting and Reporting Requirements 3.30 Project accounts, including statements of expenditures, will be maintained by RD with separate accounts for each component. In accordance with the country-s constitution, the Auditor General carries out an annual audit of all government accounts and submits a report to the Ministry of Finance and the National Assembly. The statutory responsibility is discharged by carrying out test checks and examinations, and this is adequate for the purposes of the project. The annual report of the Auditor General is printed and freely available to the public. Agreement has been reached with the Government on progress reporting requirements (Annex 3) and the submission of a project completion report in a form satisfactory to the Bank, not later than six months after the project Closing Date (para. 5.02). I. Environmental Aspects 3.31 No major environmental problems are anticipated. As the project roads follow or approximate existing alignments, no major disturbance to current land use should occur. The reconstructed roads will have improved drainage facilities which will benefit the immediate surrounding area. Noise and dust will also be considerably reduced due to the bituminous paving, and wider and well constructed shoulders will contribute to road safety. - 27 - IV. PROJECT JUSTIFICATION A. General 4.01 Under successive National Development Plans, Botswana has been upgrading its basic road network and strengthening its road administration with assistance from the Bank and other aid agencies. The proposed project would continue this assistance by helping to finance construction of the Dumela-Zimbabwe border road (76 km) which has high priority in the current National Development Plan (para. 2.21). The project would also support the Plan's goals to improve rural roads and create a more effective maintenance organization (para. 1.12) by (a) providing access to the arable lands of the Tuli Block and adjacent areas by improvement of the Selebi Phikwe-Sefophe road (25 km) to paved standard and spot improvements to 150 km of adjacent roads; and (b) strengthening road maintenance operations by the construction of a building to house the Soils and Materials Laboratory; the construction or enlargement of nine Road Maintenance Depots; and the provision of a variety of consulting services to the RD. 4.02 The proposed construction of the Dumela-Zimbabwe border and the Selebi Phikwe-Sefophe roads is expected to yield economic returns (ER) of 11% and 18%, respectively, and the spot improvements, a combined ER of 35%. The overall ER for these project components is estimated to be 13%. No ER has been calculated for the construction of buildings and provision of consulting services. However, the construction of the new Soils and Materials Laboratory should result in cost savings to RD which will no longer have to rely on expensive consulting services for testing. The improvement of the maintenance depots will support the ongoing Road Maintenance Program and is expected to improve the equipment availability rate, by providing storage for spare parts and facilities for servicing road maintenance equipment and vehicles in the field. B. Economic Evaluation 1. Construction of the Dumela-Zimbabwe Border Road (76 km) (a) Area of Influence and Main Benefits and Beneficiaries 4.03 The Dumela-Zimbabwe border road is an extension of the North- South road, the country˝s main transport artery. As the only road link with Zimbabwe, it forms part of an important international route between the RSA and Zimbabwe. The road is locally important by linking rural areas in the northeast with Francistown, a major employment, supply and distribution center, besides serving an area which includes about 71,000 ha of arable land with potential for increased agricultural production. 4.04 Due to poor maintenance in the past, much of the existing road surface has deteriorated, and major repairs are now required before the road can be maintained economically. At the same time, the level of traffic using the road has been steadily increasing, and significant savings in - 28 - vehicle operating costs (voc) and maintenance expenditures can now be expected by reconstructing the road to paved standards. Benefits are also expected from a reduction in road accidents, particularly those involving cattle, due to the fencing of the road reservation; these benefits have not been included in the computation of the ER since they are difficult to quantify due to lack of reliable data. 4.05 The primary beneficiaries of transport cost reductions will be the vehicle owners and operators using the road between Francistown and the northern rural areas, although international traffic using the road would also benefit from its improvement. Furthermore, because the trucking industry is very competitive and free of tariff controls, savings in voc are expected to result in lower prices for goods and produce so that project benefits would be widely distributed among the local population and traders in the area served by the road. Benefits would also accrue to the people travelling to and from Francistown by private cars, taxis and commercial vehicles. At the very least, the paving of the road is expected to slow down increases in the prices of goods and services affected by transport costs. (b) Economic Analysis (i) Traffic 4.06 The principal traffic generators in the area are the commercial activities and the distributional effects of Francistown as a major marketing center. Since the independence of Zimbabwe in March 1980, there has also been a spurt in traffic across the border, carrying building materials and other commodities which have hitherto been imported exclusively from RSA. Traffic on the road was counted by consultants in 1979 and again in early 1980; the current traffic along the various road sections is estimated as follows: Dumela-Tsamaya, 150 vpd; Tsamaya-Tshesebe, 130 vpd; Tshesebe-Ramokgwebana, 110 vpd; and on the last 11 km approaching the border, 75 vpd. Traffic consisted of 50% cars and light vehicles, 30% medium-size goods vehicles, and the remainder heavy trucks. 4.07 While traffic growth for internal corridor traffic travelling to or from Francistown for employment or supplies averaged about 14% p.a. during the period 1974-80, it is not expected to continue at this rate since the high levels of traffic associated with development of mining in the area have now leveled off. In accordance with these reduced expectations for future growth, a traffic growth rate of about 7% p.a. has been used in the analysis. Under this assumption, by 1983, when construction of the road is completed, traffic will vary between 230 vpd and 115 vpd on the respective sections as indicated in Table 4.1; this includes normal traffic plus generated traffic equivalent to 20% of the 1983 traffic level. - 29 - Table 4.1: Projected Traffic Levels in 1983 (vpd) Normal Generated-/ Total Dumela-Tsamaya (34 km) 190 40 230 Tsamaya-Tshesebe (13.5 km) 150 35 185 Tshesebe-Ramokgwebana (17.5 km) 140 30 170 Ramokgwebana-Zimbabwe border (11 km) 95 20 115 1/ Generated traffic benefits are valued at half the unit rate applied to normal traffic in the economic analysis. Source: Brian Colquhoun and Partners, Feasibility Study for the Dumela- Ramokgwebana Road, 1979, and mission estimates. (ii) Vehicle Operating Costs 4.08 Transport costs on the road are based on operating typical vehicles and are presented in Table 4.2. The present road consists of gravel and sand sections and is of fair quality but deteriorates substantially during the short but intensive rainy season. After the improvement proposed under the project, vehicle operating costs are expected to be reduced by about 27% to 47% depending on vehicle type and road surface. Table 4.2: Vehicle Operating Costsl/ (thebe/km) Surface Pass.Car/Taxi Pickup Bus Truck2/ Heavy Truck3/ Bitumen 9.6 13.7 15.3 21.4 27.3 Gravel 13.0 17.6 20.3 29.1 37.2 Earth 16.0 21.7 23.2 33.5 41.8 Sand 17.6 23.9 25.5 40.7 50.8 1/ In mid-1980 prices, net of taxes. 2/ 2-5 tons. 3! Over 5 tons. Source: Brian Colquhoun and Partners, Feasibility Study for the Dumela- Ramokgwebana Road, 1979, and mission estimates. - 30 - (iii) Construction and Maintenance Costs 4.09 The estimated cost, net of taxes at mid-1980 prices, of constructing the road to two-lane bituminous paved standards is US$12.2 million, including 10% physical contingencies and US$1.2 million for construc- tion supervision. The works are expected to take 24 months to complete and the road will be opened for traffic in late 1983. Routine maintenance costs for the new road are estimated at P 227 per km (net of taxes) during the first year after the opening of the road, and costs for subsequent years have taken into consideration the need for increased maintenance owing to the expected increase in traffic. These costs have been based on the recommendations of consultants who carried out the Highway Maintenance Study. The annual surface patching requirements were estimated by using the relation- ship with traffic loading developed in the British Transport Road Research Laboratory Report No. 674, "Road Transport Investment Model for Developing Countries." Resealing of the road with a single bituminous surface treatment is envisaged after seven years and every five years thereafter at an estimated cost of P 5,500 per km (net of taxes). These costs are satisfactory. The maintenance cost of the road without the project is based on a satisfactory level of routine and periodic maintenance being performed to preserve the existing condition of the road. For details, see Annex 4. (iv) Economic Return 4.10 The improvement works are expected to have an economic life of 20 years. Economic analysis of the above-mentioned costs and benefits shows that improvement of the Dumela-Zimbabwe border road to paved standards yields an overall ER of about 11%, assuming the level of traffic indicated above (Table 4.1). A separate analysis has also been carried out for each section of the road, and the ERs range from 7% to 13% (Table 4.3). Table 4.3: Economic Return on the Dumela-Zimbabwe Border Road (%) Sensitivity 10% increase 25% reduction 50% reduction in construc- in cross-border in cross-border Estimate tion costs traffic traffic (1) & (3) (1) (2) (3) Dumela-Tsamaya (34 km) 13 12 12 11 8 Tsamaya-Tshesebe (13.5 km) 11 9 9 8 7 Tshesebe-Ramckgwebana (17.5 km) 9 7 7 6 5 Ramokgwebana-Eorder (11 km) 6 5 4 4 Overall ER (76 l:) 11 10 9 8 7 - 31 - (v) Sensitivity 4.11 Cost estimates are comparable to those found in the RSA and, based on experience with similar projects in Botswana, are not likely to increase by more than 10% above the costs used in the analysis. Nevertheless, a sensitivity analysis was carried out and the results are shown in Table 4.3. A 10% increase in costs would yield an overall ER of 10%, which is satisfactory since the opportunity cost of capital in Botswana is about 10%. Because of the extreme sensitivity of the road to a further increase in construction costs, the Government has agreed to inform the Bank of the bid results immediately on opening of bids to allow for a decision on a possible reduction in the scope of the civil works. An analysis has also been carried out for different levels of cross-border traffic and it shows that for a 25% reduction the overall ER would be 9% while a further reduction to 50% would yield an overall ER of 8%. In the unlikely event of a closure of the border, the overall ER would be 7%. The sensitivity analysis shows that in the event of a combined 10% increase in costs and a 50% reduction in cross-border traffic, the overall ER would be 7%. Further- more, a 10% increase in costs or a 9% reduction in benefits would result in a 10% rate of return. 2. Construction of the Selebi Phikwe-Sefophe Road (25 km) and Access Road to the Selebi Phikwe Airport (7 km) (a) Area of Influence and Main Benefits and Beneficiaries 4.12 Selebi Phikwe is a mining town which has grown rapidly since the copper-nickel mines started operations in 1974. Population has been attracted to the area in large numbers, particularly from the tribal lands surrounding the town, and today the population concentration in Selebi Phikwe is the highest in Botswana outside of Gaborone and Francistown. The Selebi Phikwe- Sefophe road cuts across the tribal lands and improves access to the Tuli Block freehold farms which are being purchased from owners by the Botswana Development Corporation for agricultural development. The access road to the Selebi Phikwe international airport not only serves the airport users, but also provides a link between the two mines in Selebi Phikwe. 4.13 Quantified benefits arising from improving the roads are the savings in voc, which will accrue to vehicle owners and operators in the first instance, and savings in maintenance expenditures. The realignment of the road will also reduce travel distances by about 5 km. The reduced transport costs are likely to contribute to a lowering or stabilization of prices in the Selebi Phikwe consumer market, particularly of agricultural produce and imports from South Africa. Other benefits, such as passenger time savings and better access to social facilities and reduced accidents, have not been included in the analysis due to lack of reliable data. (b) Economic Analysis (i) Traffic and Vehicle Operating Costs 4.14 Because of the development occurring in the mining sector in and around Selebi Phikwe, population is being increasingly drawn there for jobs and supplies, and this has resulted in increasing traffic volumes on the project road. Traffic on the Selebi Phikwe-Sefophe road is currently - 32 - about 100 vpd and is expected to continue growing at 7% p.a. until 1992 and at a reduced rate of 4% p.a. thereafter as the mines reach their practical operating capacity. Traffic volumes on the airport road are currently about 175 vpd and are expected to grow at a rate of 5% p.a., until 1990 and 3% p.a. thereafter. Vehicle operating costs are those presented in Table 4.2. The savings in voc reflect the difference between the costs expected on the existing earth track and those on a new paved road. (ii) Improvement and Maintenance Costs 4.15 Cost estimates, net of taxes at mid-1980 prices, of the roads are shown below: Cost (US$ million) Item Selebi Phikwe-Sefophe Road Airport Road Civil Works (including physical contingencies of 10%) 2.61 0.48 Supervision 0.23 0.04 Total 2.84 0.52 Road improvement is estimated to take about 15 months to complete (1981-82). Routine maintenance costs for the new road are estimated at P 66 per km (net of taxes) during the first year following the opening of the road, and costs for subsequent years have been based on recommendations by consul- tants who carried out the Highway Maintenance Study, as in the case of the Dumela-Zimbabwe border road (para. 4.09). It is also assumed that the road would be resealed after seven years and that an overlay would be provided in 1997. Maintenance costs without the project were estimated at P 1,616 per km, which is the amount required to preserve the road in its existing condition. For details, see Annex 4. (iii) Economic Return and Sensitivity 4.16 The newly constructed two-lane bituminous paved road is estimated to have an economic life of 20 years. Economic analysis of the above-men- tioned costs and benefits involved in the road construction indicate that both the Selebi Phikwe-Sefophe road and the airport access road are justified with ERs of 17% and 22%, respectively, and 18% overall. Because the analysis assumes a very conservative traffic growth rate and uses cost figures based on detailed engineering, it is not expected that this component will entail any undue risks. Nevertheless, a sensitivity analysis was carried out to test the effect of a 10% increase in costs, a 10% decrease in benefits or a combination of both factors. The results indicate that even under these conditions the ecinomic returns would be a satisfactory 16%, 20% and 12%, respectively. - 33 - 3. Spot Improvements to 150 km of Feeder Roads in the Tuli Block Area (a) Area of Influence, Benefits and Beneficiaries 4.17 The proposed project would include spot improvements over 150 km of the Dikabeya-Sefophe and the Sefophe-Tsetsebjwe roads, adjacent to the Selebi Phikwe-Sefophe road. While the area served by the project roads has some potential for crop production, its main activities are mining and cattle raising. In the absence of any further development to the area (para 4.19), the improvement of the two roads is mainly expected to facilitate access to the market in Selebi Phikwe. 4.18 The main benefits of the spot improvements will be savings in voc for the private and commercial vehicles using the roads. As the two roads act as feeder roads to the Selebi Phikwe-Sefophe area, the benefits are expected to accrue to the population living in these corridors who travel to and from Selebi Phikwe for employment or supplies. (b) Economic Analysis (i) Traffic and Vehicle Operating Costs 4.19 Traffic volumes on the two feeder roads currently vary between 24 and 37 vpd depending on the road section. During recent years, there has been little or no growth in traffic principally because the local popula- tion and farming activity have remained practically static. While the Govern- ment has indicated its intentions of promoting agricultural development in the area, no firm plans for this have yet been made. The economic analysis of this investment therefore excludes any agricultural development and assumes an average annual traffic growth of about 2%. The savings in voc (Table 4.2) reflect the difference between the costs expected on the existing earth tracks in poor condition and those entailed on a good earth road. For details see Annex 4. (ii) Economic Return and Sensitivity 4.20 Based on traffic projections and the type of work planned, an economic life of 7 years is expected. Economic analysis of the costs and benefits associated with the spot improvements demonstrates that these works are well justified and have an overall ER of 35%. Specifically, on the Dikabeya-Sefophe road the ER is estimated at 56% while on the Sefophe- Tsetsebjwe road the ER is 23%, reflecting the substantial benefits to be obtained from modest amounts spent to preserve existing capital. In view of the high rates of return expected and variations in the basic assumptions likely, no sensitivity analysis has been carried out. 4. Other Project Elements 4.21 Benefits have not been quantified for the construction of a Soils Laboratory building and the nine maintenance depots or the provision of - 34 - technical assistance to RD, although both components are expected to improve RD's operations. The various buildings to be provided under the project should assist RD in implementing its 5-year road Maintenance Program while the consultants to be provided will further strengthen the roads administration so that it will eventually be able to dispense with such assistance. C. Risks 4.22 The major risk to the proposed upgrading of the Dumela-Zimbabwe border road is the uncertainty of traffic between Botswana and neighboring Zimbabwe. Since the border was officially reopened between the two countries, traffic has increased substantially as a result of increasing trade between Zimbabwe and the Francistown area of Botswana. The border is not likely to be closed again, but traffic growth would be affected by conditions in Zimbabwe. If there is a major decline in traffic crossing the border, the rate of return on the road section from Ramokgwebana to the border would drop significantly and thus make paving of this section unjustified. However, as the road is part of a major international route with a total length of about 600 km, which has already been paved for a distance of about 520 km, the last 11 km to the Zimbabwe border should also be paved despite the low rate of return under the most pessimistic assumptions. V. AGREEMENTS REACHED AND RECOMMENDATION 5.01 Agreement has been reached with the Government that: (a) not later than June 30, 1981, it will appoint two additional instructors to the RTC and that, thereafter, the teaching staff of RTC consisting of a Senior Training Engineer and five instructors shall be maintained until the Government and Bank should otherwise agree (para. 3.19); (b) contracts for construction of the Dumela-Zimbabwe border and Selebi Phikwe-Sefophe roads will be awarded after inter- national competitive bidding in accordance with Bank Guidelines (para. 3.26); (c) contracts for the civil works on the RD Soils and Materials Laboratory building and road maintenance depots will be awarded after ICB in accordance with Bank Guidelines, but publication of the invitation to bid will be limited to advertising in the local press, informing the few local representatives of Bank member countries and publishing an announcement in the Development Forum (para. 3.27); and - 35 - (d) suitably qualified consultants will be engaged under terms of reference and conditions of employment satisfactory to the Bank to assist in project implementation (para. 3.28). These have been incorporated as covenants in the Loan Agreement. 5.02 An implementation schedule, progress reporting requirements, and the submission of a project completion report, in a form satisfactory to the Bank, have also been agreed with the Government (paras. 3.25 and 3.30). 5.03 In addition to the above agreements reached, the Government has confirmed that: (a) it has reached an agreement with AfDB to finance the proposed National Transport Study and would keep the Bank informed of progress and provide reports and results of the study when available (para. 1.15); (b) an updated inventory of RD equipment and vehicles together with information on the operational status of each item, will be included in the quarterly project progress reports to be submitted by Government to the Bank (para. 2.15); and (c) arrangements will be made for project financing (para. 3.24). 5.04 With the agreements and conditions outlined above, the project is suitable for a Bank loan of US$17.0 million to the Republic of Botswana for 17 years including a 4-year grace period. November 20, 1980 - 36 - ANNEX 1 Page 1 of 2 BOTSWANA FIFTH ROAD PROJECT STAFF APPRAISAL REPORT Pavement Strengthening Program Outline Terms of Reference 1. The Sebele-Gaborone-Lobatse-Pioneer Gate road (80 kn) is comprised of two sections: the Sebele-Gaborone-Lobatse section (72 km) which is part of the North-South road, the country's main transport artery; and the Lobatse-Pioneer Gate section (8 km) which provides a spur to the South African border and links Pioneer Gate with the road to Johannesburg. The road was one of the earliest roads to be paved in Botswarna and was constructed in 1974 with the assistance of the Swedish International Development Association. The pavement was designed for a service life of 10 years. Since 1978, traffic on the road has grown faster than originally forecast and sections of the road may already have carried passes of heavy traffic close to their design capacity and would therefore require strengthening. Although priority will be given in the study to the above road, other roads which have been identified by the Government as requiring strengthening may also be considered, but the program will cover a total of 80 km only. Objectives 2. The objectives of the study are to (a) evaluate the strength and residual life of the existing pavement, (b) prepare a program to strengthen sections of the pavement, (c) design suitable strengthening measures and (d) train a team of Roads Department Technicians in pavement testing techniques. The consultants shall perform all engineering work, field investigations and related work as required to attain these objectives. Scope of Consulting Services 3. The pavement evaluation work shall commence with a general survey of pavement condition, followed by a deflection testing program under standard load using the Benkelman Beam or other equipment determined by the consultants to be most suitable to conditions in Botswana, taking into consideration the simplicity of the paved road network, light traffic, pavement materials and subsoil conditions, climate and other relevant factors. On the basis of the pavement condition survey and deflection - 37 - ANNEX 1 Page 2 of 2 tests, the road shall be divided into sections of similar characteristics. 4. The consultants shall calculate the residual life of the road sections using traffic projections, composition and axle load information supplied by the Roads Department and identify the sections that need strengthening in the near future. In assessing the life of the pavement, the consultants shall estimate the number of standard axles that the road sections can carry on the basis of investigations made by the British Transport Road Research Laboratory or other sources. 5. The consultants shall determine the dates when the different road sections would require strengthening and shall design asphalt overlays or other strengthening measures for a service life of ten years, taking into account the traffic information provided by the Roads Department. The consultants shall prepare specifications for the strengthening works and documentation for executing the works by contractors. 6. During the course of providing the consulting services, the consultants shall train a team of Roads Department Technicians in routine testing of road pavement using deflection equipment and shall provide the Roads Department with adequate guidelines to enable it to design strengthening measures for the country's road network on an annual basis as part of its road maintenance program. November 1980 - 38 - ANNEX 2 Page 1 of 2 BOTSWANA FIFTH ROAD PROJECT STAFF APPRAISAL REPORT Road Design Standards - Outline Terms of Reference 1. Consultants are required to review the existing road design methods, standards and practices employed by the Roads Department and its consultants who have carried out or are carrying out detailed engineering of roads in Botswana. Based on available sources of experience, research, data and information, particularly in Southern Africa, the consultants shall report on appropriate design standards for Botswana and prepare a road design manual incorporating their recommendations. 2. The road design standards will be concerned with: (a) road classification for the purposes of design; (b) design of geometric elements; and (c) design of the road surface and pavement elements. In their work, the consultants shall recognize that Botswana can be divided into zones according to the type of pavement materials avail- able and subsoil conditions and availability of water and labor for construction and that different standards can apply to different parts of the country depending on the appropriate construction and maintenance techniques. Road Classification 3. The consultants shall collect data on traffic on the different categories of the countryts roads including traffic growth rates and characteristics and determine the number of design classes and traffic volumes for which design standards have to be investigated for the present. Geometric Design 4. The consultants shall take into account the critical design factors such as traffic volume, traffic composition, vehicle character- istics, terrain, rainfall and environment in determining the design speed and the appropriate standards for the geometric elements of the road. The consultants shall note that cattle farming in open ranges is common in most parts of the country and that considerations should be made in road design for fencing, cattle crossings, foot-and-mouth disease control and any other factor associated with cattle farming. The consultants shall make recommendations as to: ANNEX 2 - 39 - Page 2 of 2 (a) pavement and shoulder widths and width of road formation; (b) cross-section elements such as pavement and shoulder crossfalls and shape of cross-section; (c) stopping, overtaking and head light sight distances; (d) horizontal curves, superelevation and side friction; (e) vertical curves and maximum grade requirements; and (f) design form (appearance, comfort and safety). Pavement Design 5. The consultants shall collect data and information on the availability and characteristics of naturally occurring road making materials for use in bituminous, gravel and earth roads. For bituminous surfaced roads, the consultants shall suggest suitable specifications using these materials for the different components of the road structure - sub base, base and surfacing. They shall make recommendations for flexible pavement design from among the methods recommended by the American Association of State Highway Officials, British Transport and Road Research Laboratory, South African Transport Research Laboratory or other sources to the knowledge of the consultants with modifications as may be necessary for Botswana conditions. For gravel and earth roads, the consultants shall suggest specifications for the choice of gravels and soils and indicate appropriate construction techniques. Road Design Manual 6. The consultants shall incorporate their recommendations in a manual for use by the Roads Department. November 1980 - 40 - ANNEX 3 Page 1 of 3 BOTSWANA FIFTH ROAD PROJECT STAFF AP?RAISALJ RFPORT Project Progress and Reporting Requirements A. Project Progress Reports 1. Progress Reports should be submitted quarterly in triplicate, no later than one calendar month after the end of the quarter. The first Report should cover the quarter ending June 30, 1981. 2. The Report shall contain the following information: (a) General Information: this section should refer to Project Monitoring indices (Attachment) in reporting the following: (i) the physical progress accomplished to date of report and during the reporting period; (ii) the progress made in achieving training objectives; (iii) actual or expected deviations from the project implementation schedule; (iv) actual or expected difficulties or delays and their effects on the implementation schedule, and the steps planned or taken to overcome the difficulties and avoid further delay; (v) expected changes in the completion date of the project; (vi) key personnel changes in the staffs of MWC's Roads Department, consultants or contractor;, (vii) matters which may affect the cost of the project; and (viii) any development activity likely to affect the economic viability of project components. (b) A bar-type progress chart, based on the project implementation schedule, should show the progress in each project component. - 41 - ANNEX 3 Page 2 of3 (c) A financial statement should be set out in tabular form and indicate for each project component: (i) original estimated cost; (ii) revised cost, if appropriate; (iii) actual expenditure; (iv) projected expenditure; and (v) actual and projected withdrawals from the Loan Account. (d) Finally, the Report should state the status of action on each covenant of the Loan Agreement. 3. The Report shall also include an updated inventory of RD equipment and vehicles, giving details of make, model and year of purchase of each item together with its current operational status. B. Project Completion Report 4. The Borrower will prepare a Project Completion Report (PCR), to be submitted to the Bank not later than six (6) months after the Closing Date. 5. The primary objective of the PCR is to reinforce self-evaluation by the Borrower and the Bank's operating departments and to facilitate dissemination of lessons learned through the project: (a) the performance by the Borrower and the Bank of their respective obligations under the Loan Agreement and whether the Bank could have been more helpful; (b) the results that can be expected from the project, as compared with expectations at appraisal, and whether the original expectations were realistic; and (c) whether in retrospect the project was worth doing or could have been done better. 6. For those components of the project for which a rate of return was estimated during appraisal, the PCR should contain a new estimate of the return the project is now likely to yield and analyze the reasons for physical or economic deviations. However, the new rate of return calculation should be as simple as possible under the circumstances and should absorb only a minor portion of the time devoted to the preparation of the PCR. An annex with the relevant information supporting this analysis should be included. - 42 - ANNEX 3 Page 3 of 3 7. The basic documents to be referred to are: (a) Loan Application; (b) Feasibility Studies, Preappraisal Report, Project Brief; (c) Appraisal Report; (d) Loan Agreement Documents, Supplementary Letters, etc.; (e) Supervision Reports; (f) Quarterly Progress Reports; (g) Project Correspondence Files; and (h) Miscellaneous Evaluation Reports. 8. The Highways Division, Eastern Africa Projects Department, will review and comment on the PCR in consultation with the Programs Department. After approval by the Highway Division Chief, the PCR is sent to the Bank Group's Operations Evaluation Department (OED) which is responsible for conducting an audit of the project subsequent to the PCR exercise. This audit can lead to suggestions for changes or additions in the PCR as OED prepares the Project Performance Audit Report (PPAR) for submission to the Bank Group's Board of Directors. Before going to the Borrd, the draft PPAR which includes the PCR, is sent to various Bank Group divisions, to the Government and occasionally to consultants (especially if they have been criticized). November 1980 -43- ANNEX 3 Attachment Project Monitoring Indices Indices: actual vs estimates! absolute and X where activity level, as measured by a specific index, is below estimates, the reeaou should be ascertained, If a lower than anticipated activity level is the result of an outstanding problem recommend corrective action. Actual as % Reason for Recommended Corrective Estimated Actual of Estimated Divergence Action, if any I. Construction Work for each Contract (a) Preliminaries to mobilization (months) (b) Volume of earthwork (3m3) (c) Length of subbase (km) (d) Length of base (km) (e) Length of shoulders (km) (f) Length of surfacing (km) (g) Pipe culverts (nos.) (h) Box culverts (nos.) (i) Length of bridges (m) (j) Ancillary works (km) (k) Construction work completed (date) (1) Contractor certificate for payment (P) (n) Payments to contractor (P) II. Supervision of Construction and Improvement for eaeh Contract (a) Preliminaries to start (months) (b) Supervision (man-months) (c) Cumulative monthly invoices from conaultants (P) (d) Payments to consultants (P) III. Buildings (a) Preliminaries to start (months) (b) Construction of depots (% completed) (c) Payments for construction (P) IV Consulting Services for Pavement Evaluation and Design Standards (a) Preliminaries to start (months) (b) Inception report (date) (c) Draft final report (date) (d) Final report (date) (e) Cumulative monthly invoices from consultants (P) (f) Payments to consultants (P) V. Covenants of Credit Agreement (a) (b) (c) (d) (e) - 44 - BOTSWANA ANNEX 4 FIFTH ROAD PROJECT Page I of 2 STAFF APPRAISAL REPORT 11 Economic Evaluation of Dumela-Zimbabwe Border Road- Whole Dumela- Tsamaya- Tshesebe- Ramogkwebana- Parr.mei-er Unit Road Tsamaya Tshesebe Ramogkwebana Border LENGTH km 76 34 13.5 17.5 11 TRAFFIC (i) Volume 198 1983- light AADT - 107 86 78 53 - mediun AADT - 68 54. 50 34 - heavy AADT - 52 42 39 26 - total AADT - 227 182 167 113 (ii) Annual Growth 1983-2002 % 7.3 7.3 7.3 7.3 7.3 Economic Cost of Construction and Improvement 3/ - civil works per km P'000 101.2 125.5 128.4 127.5 116.7 - total P'000 7,689 4,26R 1,734 2,232 1,284 4/ Vehicle Operating Costs-/ 1983: savings in voc P'0OO 747 410 130 143 64 Road Maintenance 1983: savings P'000 - 21 8 4 17 Life of Projcct years - 20 20 20 20 Economic Return X 11 13 11 9 7 1/ Mid-1980 prices, net of taxes. 2/ Year when whole length of road open to traffic. 3/ Including supervision cost and 10% physical contingencies. 4/ Savings in voc for normal and generated traffic. Source: Brian Colquhoun and Partners, Feasibility Study for the Dumela-Ramokgwebana Road, 1979,and mission estimates. November 1980 - 45 - BOTSKANA FIFTH ROAD PROJECT ANNEX 4 STAFF APPRAISAL REFPOT Page 2 of 2 Economic Evaluation- Selebi Phikwe- Airport Dikabeya- Sefophe- Parameter Unit Sefophe Road Sefophe Tsetsebjwe LENGTH km 25 7 93 56 TRAFFIC (i) Volume 1983=- AADT 125 193 25 37 (ii) Annual Growth ( 7% to 1992( 5% to 1990 ( ( 1983-onwards % ( 4% ( 2.5% 1.5 1.5 Economic Cost of Construction and Improvement 3/ -C ivil works/km P'000 70 74 1.19 3.64 - total P'000 1,942 370 ill 204 Vehicle Operating Costs 1983: savings, in voc pFooO 248 37 69 65 Road Maintenance 1983: savings P'OOO 42 31 - Life of Project years 20 20 7 7 Economic Return % .7 22 56 23 1/ Mid-1980 prices, net of taxes. 2/ Year when whole length of road open to traffic. 3/ Including supervision cost and 10% physical contingencies. %Ource: TANS/NZA Group Consultants, Report on tbe Technical nod Economnic Feasibility of-Roads-in the Tuli Block and the Adjacent Trccditional A^rna, 1979, and ;nission estimates. November 1980 - 46 - ANNEX 5 BOTSWANA FIFTH ROAD PROJECT STAFF APPRAISAL REPORT Related Documents and Data Available in Project File I. Reports Related to Transportation A. National Development Plan (1979-85) - Transport and Communications Chapter B. Transport Statistics (1976-78) II. Reports and Studies Related to the Project A. Feasibility Study for the Dumela-Ramokgwebana Road, Final Report Vols. I, II and III, Brian Colquhoun and Partners, October 1979. B. Report on the Technical and Economic Feasibility of Roads in the Tuli Block and the Adjacent Traditional Area, Phase I, Two Volumes, TAMS/NZA Group Consultants, April 1979. C. Report on the Technical and Economic Feasibility of Roads in the Tuli Block and the Adjacent Traditional Area, Final Report, Two Volumes, TAMS/NZA Group Consultants, November 1979. D. Design Report and Tender Documents for the Dumela-Zimbabwe Border Road by John Burrow and Partners, 1980. E. Design Report and Tender Documents for the Selebi Phikwe-Sefophe Road and access road to Selebi Phikwe Airport by TAMS/NZA Group Consultants, 1980. III. Working Papers A. Price Contingency Calculations. B. Computer Print Outs - Economic Rates of Return. November 1980 BOTSWANA APPRAISAL OF FIFTH ROAD PROJECT ORGANIZATION OF THE MINISTRY OF WORKS & COMMUNICATIONS | SMINISTER ] PERMANENT SECRETARY DUTY PERMANENT SECRETARY UNDER SECRETARY (TECHNICAL) -| PLANNING l l ~~~ADMINISTRAIN | -|RAILWAYS ADVISOR | | |ROAD TRANSPORT | _I FINANCE & ACCOUNTING| CENTRAL TRANSPORT POSTS AND~RADTRA CENTRAL =TMRANS TTELECOMMUNICATSROADS CIVILAVIATION BUILDINGS METEOROLOGY ORGANIZATION DEEPARTMENICTIOS 092Q a _DEPARTMENT' DEPARTMENT DEPARTMENT Source: Ministry of Works and Communications MAY 1980 World Bank - 21845 BOTSWANA APPRAISAL OF FIFTH ROAD PROJECT ORGANIZATION OF THE ROADS DEPARTMENT [ CHIEF ROADS ENGINEER J ADMINISTRATION BRANCH DEVELOPMENT BRANCH [ MAINTENANCE BRANCH DIRECT LABOR BRANCH | SPECIAL PROJECTS BRANCH PRINCIPAL ACCOUNTING PRINCIPAL ROADS PRI NCIPAL ROADS PRINCIPAL ROADS CHIEF EXECUTIVE OFFICER ENGINEER ENGINEER ENGINEER ASSISTANT PEnSONNEL SENIOR ROADS CHIEF TECHNICAL SENIOR ROADS 1 & INDUSTRIAL CHIEF TECHNICAL IENGINEER (MAINTEN- OFFICER (SECONDARY ENGINEER (ROADS CLASS RECORDS OFFICER DEVELOPMENT) ANCE) ROADS) TRAINING CENTER) { S EN IOR ROADS 1SENIOR ROADS 1SENIOR ROADS TECHNICAL OFFICER 1 ACCOUNrS INOINEER (DESIGN) ENGINEER (SOUTHERN ENGINEER (RURAL ITRAFFIC EVAL.UATION) I _____________________ _____ _____________ ]REGION) ROA DS)_ _ __ __ _ __ _ __ SENIOR ROADS 1SENIOR ROADS 1SENIOR ROADS TECHNICAL OFF ICER 1 REGISTRY X ENGINEER (CONSTRUCTION) ENGINEER (NORTHERN ENGINEER (PLANNING (EMERGENCY WORKS) l ______ J ~~~~~~~REGION) ]& DISTRICT ROADS) _ _ _ CHIEF TECHNICAL SENIOR ROADS 1 STORES COFFICER (MATERIALS ENGINEER (WESTERN lE I(ROAD SAFETY)F AND PARTS) REGION) l Source: Roads Department, Ministry of Works and Communications MAY 1980 World Bank - 21846 MAY~~~~~ 1980 BOTSWANA CHART 3 APPRAISAL OF FIFTH ROAD PROJECT PROJECT IMPLEMENTATION SCHEDULE: ACTWIVIT ACTION 1996 1981 1982 1963 1984 _ _ _ _ _ _ _ BY ~~~~~~~~~~~JIFAJIM JfIS 4J JIAA]FI[D _ 1 B-lLe I - Swa, Loa Gaone,GotBn Loa A,re-en ERtetit 0at Batk D.-wtelgZ-,tba-v BotO, Roa Bidding C_otn-non Cotttt-l Ettrot,- SDeGv P,) t -ottlmprO Soo iE RDlSati ago M..-GOtletl I lSo npoEnnf-t Cotn-r, -- 0R-1 M.m.- D.,,.. ~ tot2 l aoo 3 C O -totS B,dn E-i-i- tdtotrd 8,-d,s lltt-,a.tlte EoaoatonaOAw,d C - rStl 4i 0SiSadMtte Conrn.c,ot Coottot- Sh- UatioCn-Sat- GSOonB.ek Co-t.lt .te.d A et. S-ot Conrato MStaatio C....toe A Cont Ptp--.tooea 1S.,W.. Ctalt Tells 01 nOeen. god Shorn La, Cnutat ooB OaTcat-O Asiand Goe RD GootOek A I RTI Cinstruor,tS patitr Selab, PliOwe p0a9 and Spot ttttp,ooet,tantt ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ WrldBak 287 8RD 15120 REPUBLIC OF BQTSWANN FIFTH ROAD PROJECT RANSIPORT NETWORK .5 FFFTH ROAU PROJECT ".7 A N G, -- p-.d -d.,d C Pfuv 0I US RANK PROJECTS C H 0 B F Z 1A IW E ...... ... 2 3 1WXR-d R.1.0 L- 1174 OT) d 'j 4 408-ul) p-d l,Rr&,d NGAMI LA E)4TING RoAos N D AP Wo ..dl, tue IX' N&RTH'EAS Ak*l*.fp __A-N Y..iqt Rakops_ t VI Or. P ;F C E T R A L z ele GHANZJ 1'7 4 mQ,,,,g K A L A A R lopy. Sh-h..g 00 ftpd qpyi D S E R T C, KWENENG Letlhokeng KG 24', 3P' z Mol Z, och,d 0 Gb K G A L A G)A D I K- A NG OL A ZAMBIA A, SOUTHE R N 177 F -"-\ZIMBABWE ----------- \NAMigIA JREPUBLIC f OF HOTSVVANA/ 2t, R E P U S' I OF LEWFH SOUTH 0 40 A M y 0 701