Togo - Burkina Faso - Road Rehabilitation and Transport ......AND TRANSPORT FACILITATION ON THE LOME – CINKANSE- OUAGADOUGOU CU9 CORRIDOR COUNTRY: TOGO/ BURKINA FASO PROJECT APPRAISAL

Language: English

Original: French

PROJECT: MULTINATIONAL TOGO/BURKINA FASO: ROAD REHABILITATION

AND TRANSPORT FACILITATION ON THE LOME – CINKANSE-

OUAGADOUGOU CU9 CORRIDOR

COUNTRY: TOGO/ BURKINA FASO

PROJECT APPRAISAL REPORT

Date: February 2012

Appraisal

Team

Team Leader:

Team Members

M. NDIAYE DIOP, Transport Engineer, OITC.1

L. EHOUMAN, Socio-Economist, GHFO

J. P. MEGNE EKOGA, Transport Economist, OITC.1

B. YOUGBARE, Infrastructure Specialist, BFFO

P. C. OUEDRAOGO, Procurement Specialist, BFFO

K. ROT-MUNSTERMANN, Resource Mobilization

Officer, ORMU

C. AHOSSI, Regional Procurement Coordinator, ORPF

M. L. KINANE, Environmentalist, ONEC.3

A consultant, Transport Economist,

Regional Director: J. K. LITSE, ORWA

Sector Director : A. OUMAROU, OITC

Sector Division

Manager :

J.K. KABANGUKA, OITC.1

Peer

Reviewers

Messrs. B. TRAORE, Lead IPPF, ONRI.0

P. RUGUMIRE, Transport Engineer, OITC.1

P. MORE NDONG, Transport Engineer, OITC.2

A. BA, Agro-Economist, OSAN.3

A. DIAW, Country Programme Officer, ORCE

AFRICAN DEVELOPMENT BANK GROUP

TABLE OF CONTENTS

1 PROJECT STRATEGIC THRUST AND RATIONALE ..................................................... 1 1.1 Project Linkages with Regional and National Strategies and Objectives .......................................... 1 1.2 Rationale for Bank’s Involvement ......................................................................................................... 1 1.3 Donor Coordination ................................................................................................................................ 2

2 PROJECT DESCRIPTION ..................................................................................................... 3 2.1 Project Objectives and Components ..................................................................................................... 3 2.2 Technical Solution Adopted and Alternatives Explored ..................................................................... 4 2.3 Project Type ............................................................................................................................................ 5 2.4 Project Cost Estimates and Financing Arrangements ......................................................................... 5 2.5 Project Area and Beneficiaries .............................................................................................................. 8 2.6 Participatory Approach to Project Identification, Design and Implementation ............................... 8 2.7 Bank Group Experience and Lessons Reflected in Project Design ..................................................... 9 2.8 Key Performance Indicators ................................................................................................................ 10

3 PROJECT FEASIBILITY ..................................................................................................... 10 3.1 Economic and Financial Performance ................................................................................................ 10 3.2 Environmental and Social Impacts ...................................................................................................... 11

4 PROJECT IMPLEMENTATION ........................................................................................ 14 4.1 Implementation Arrangements ............................................................................................................ 14 4.2 Monitoring and Evaluation .................................................................................................................. 16 4.3 Governance ............................................................................................................................................ 17 4.4 Sustainability ......................................................................................................................................... 18 4.5 Risk Management ................................................................................................................................. 19 4.6 Knowledge Building .............................................................................................................................. 20

5 LEGAL FRAMEWORK ....................................................................................................... 20 5.1 Legal Instrument ................................................................................................................................... 20 5.2 Conditions Associated with Bank’s Involvement ............................................................................... 20 5.3 Compliance with Bank Policies ............................................................................................................ 21

6 RECOMMENDATION.......................................................................................................... 21

APPENDIX I: COMPARATIVE SOCIO-ECONOMIC INDICATORS OF TOGO AND BURKINA FASO

APPENDIX II: TABLES OF BANK PORTFOLIO IN TOGO AND BURKINA FASO

APPENDIX III: MAJOR RELATED PROJECTS FINANCED BY THE BANK AND OTHER DEVELOPMENT

PARTNERS IN TOGO AND BURKINA FASO

APPENDIX IV: MAP OF PROJECT AREA

LIST OF TABLES

No. TITLE Page

Table 2.1 - Project Components ......................................................................................................................................................... 3 Table 2.2 - Alternative Solutions Explored and Reasons for Rejection ................................................................................................. 5 Table 2.3 - Project Cost Estimates by Component (in UA million) ....................................................................................................... 5 Table 2.4 - Project Sources of Financing (in UA million) ..................................................................................................................... 6 Table 2.5 - Project Cost by Expenditure Category (in UA million) ....................................................................................................... 7 Table 2.6 - Expenditure Schedule by Component (in UA million) ......................................................................................................... 7 Table 2.7 -Expenditure Schedule by Source of Financing (in UA million) ............................................................................................ 7 Table 3.1 -Summary Economic Analysis ............................................................................................................................................. 11

i

Currency Equivalents

November 2011

UA 1 = USD 1.58591

601 1,55333

UA 1 = EUR 1.13271 UA 1 = CFAF 743.009

Fiscal Year

1 January - 31 December

Weights and Measures

1 metric tonne = 2204 pounds

1 metre (m) = 3.28 feet

1 millimetre (mm) = 0.03937 inch

1 kilometre (km) = 0.62 mile

1 hectare (ha) = 2.471 acres

Acronyms and Abbreviations

ADB : African Development Bank

AADT : Annual Average Daily Traffic

ADF : African Development Fund

CPF : Women’s Empowerment Centre

CSP : Country Strategy Paper

CST : Sector and Thematic Commission

CTM : Joint Technical Committee

CTS

CU9

:

:

Blood Transfusion Centre

Community No. 9

DCPTT : Department for WAEMU Community Planning, Transport and Tourism

DGR : General Directorate of Roads

DGSCN : General Directorate of National Statistics and Accounts

DGTP : General Directorate of Public Works

EBID : ECOWAS Bank for Investment and Development

ECA : Economic Commission for Africa

ECOWAS : Economic Community of West African States

ERR : External Rate of Return

EU : European Union

FER : Road Maintenance Fund

FSF : Fragile States Facility

ILO : International Labour Organization

INSD : National Institute of Statistics and Demography

IsDB : Islamic Development Bank

KfW : Kreditanstalt fürWiederaufbau(Reconstruction credit institution)

LI

HT/HD

:

:

Labour Intensive

Exclusive of Tax/Exclusive of Customs Duty

MID : Burkina Faso Ministry of Infrastructure and Road Development

MTPT : Ministry of Public Works and Transport

ii

MTS : Bank’s Medium-Term Strategy for 2008-2012 Period

NPV : Net Present Value

OPA : Observatory of Abnormal Practices

PA

: Project Area

PACITR : Community Road Transport Infrastructure Action Programme

PAL : Lomé Port Authority

PIMU

UTA

:

:

Project Implementation Monitoring Unit

Agricultural Transformation Unit

PPP : Public Private Partnership

PRSP : Poverty Reduction Strategy Paper

RBCSP : Results-Based Country Strategy Paper

RN1 : Highway No. 1

SAFER

SCADD

: Société Autonome de Financement de l’Entretien Routier

Accelerated Growth and Sustainable Development Strategy

STD : Sexually Transmitted Disease

UA : Unit of Account

UNDB

UNDP

: United Nations Development Business

United Nations Development Programme

UNFPA : United Nations Fund for Population Activities

Veh/d Vehicles per day

VOC : Vehicle Operating Cost

WADB

BTP

:

:

West African Development Bank

Public Works and Civil Engineering

WAEMU : West African Economic and Monetary Union

WHO : World Health Organization

iii

PROJECT INFORMATION SHEET

Client Information Sheet

Recipients/Borrowers : Togo and Burkina Faso

Executing Agencies : (i) Ministry of Public Works in Togo, through the General

Directorate of Public Works;

(ii) Ministry of Infrastructure and Road Development in Burkina

Faso, through the General Directorate of Highways

(iii) West African Economic and Monetary Union (WAEMU)

Commission, through the Department for WAEMU

Community Planning, Transport and Tourism, which will

ensure overall project monitoring at the regional level and

monitoring of the implementation of the transport

facilitation component

Financing Plan

Source of Financing

Amount in UA Million*

Instrument Togo

Burkina

Faso Total

ADF Loan (Country allocation) 6.33 6.33 Project Loan

ADF Grant (Country allocation) 10.81 26.67 37.48

Institutional and Rehabilitation

Support

ADF Loan (allocation for regional

operations) 11.36

11.36 Project Loan

ADF Grant ( allocation for regional

operations) 19.42 40.00

59.42

Institutional Support and

Rehabilitation

FSF Grant to Togo 21.50 21.50


Rehabilitation

ADF Loan (from cancellation) 0.105 2153 21.64 Project Loan

ADF Grant (from cancellation)

17.93 17.93


Rehabilitation

IsDB 9.46 9.46 Project Loan

KFW 7.92 7.92 Grant

EU/African Trust Fund Grant 1.03 1.03 2.06 Grant

Private operators 2.58 1.03 3.60 Equity capital

WADB Loan 13.42 10.54 23.95 Project Loan

EBID Loan 7.77 5.78 13.56 Project Loan

WAEMU 0.48 0.46 0.93 Grant

UNFPA Grant 0.17 0.17 Grant

GOVERNMENT of Togo 10.50 10.50 Investment Budget

GOVERNMENT of Burkina Faso 2.66 2.66 Investment Budget

TOTAL 114.93 135.54 250.47

* At exchange rate of: UA 1 =CFAF 743.009

iv

ADF and FSF Key Financing Information

Loan/Grant Currency Unit of Account (UA)

Interest Type Not applicable

Interest Rate Margin Not applicable

Service Charge for ADF Loans 0.75% per annum on disbursed but unrepaid amount

Commitment Charge for ADF Loans 0.5% on undisbursed loan amount, commencing 120 days

after signature of Loan Agreement

Other Charges Not applicable

Tenor (ADF Loans) 50 years

Grace Periods and Repayment of ADF

Loans

10 years

FRR, NPV (baseline scenario) Not applicable

ERR, NPV (baseline scenario) 27% and CFAF 284 billion for the entire project

Duration – Main Milestones (expected)

Activities (Month, Year)

Concept Note Approval January 2012

Project Approval June 2012

Completion December 2016

Last Disbursement December 2017

Last Repayment June 2062

v

EXECUTIVE SUMMARY

Project Overview

This project concerns the Lomé-Ouagadougou CU9 Road Corridor which forms part of the

priority highways of the West African Economic and Monetary Union (WAEMU) community

road network. The nearly 975 km-long corridor comprises road sections with different levels

of service. The project consists in the rehabilitation of 303 km of road in very bad or bad

condition, with 150 km in Togo and 153 km in Burkina Faso, as well as the improvement of

transport facilitation along the corridor. The expected outcomes are increased transit traffic

and trade, reduced general transportation costs, improved road safety, and the creation of jobs

for youths and women.

The project will be implemented in five (5) years, and its total cost is estimated at UA 250.47

million (exclusive of tax and customs duty), including provision for physical contingencies

and price escalation. The Bank Group (ADF and FSF) will contribute UA 175.66 million. The

other donors are EBID, WADB, IsDB, KFW, UNFPA, EU/Africa Trust Fund, private

operators, WAEMU and the two Governments. In view of the regional nature of the project,

its economic and social benefits will accrue directly or indirectly to all users of the corridor,

and the inhabitants of the direct and extended PA which covers Togo and a large part of

Burkina Faso, Mali and Niger. The beneficiary population participated in the project design

and made a technical and financial contribution to the construction, management and

maintenance of some related infrastructure.

Needs Assessment

The Lomé-Cinkansé-Ouagadougou CU9 Corridor is the backbone of Togo’s road network,

and the only road linking all the regions of the country. The corridor is also very important for

the sub-region’s landlocked countries, particularly Burkina Faso, because the Lomé Port

Authority (PAL) is currently the primary transit port for its overseas trade. The corridor is in

quite an advanced state of degradation with 38% of its stretch in a very bad or bad condition

and 13% in a poor condition. Since the maintenance thresholds of some sections of the

corridor have been exceeded, the urgent rehabilitation of this road is therefore the only

possible alternative. Similarly, efforts undertaken to make Lomé Port attractive and

competitive should be sustained by eliminating obstacles to traffic on the corridor.

Value added for the Bank

The Bank’s involvement is justified by the fact that: (i) this project will help to achieve the

objective of its Regional Integration Strategy (2009-2012) which consists in providing

assistance in the form of investment, technical assistance and expertise to countries, so as to

facilitate the construction of priority regional infrastructure; (ii) the Bank’s support will

strengthen its last operations on this corridor (Lomé-Notsé Road Project in Togo implemented

before the crisis of the 2000s) and the Bank’s private sector operation in 2011 as part of the

extension of PAL’s container terminal; (iii) it has solid experience in similar regional projects

in Africa in general and in West Africa in particular. The project will therefore enable Togo to

fully play its vital role as inter-State trade road corridor for hinterland countries (Burkina

Faso, Mali and Niger).

vi

Knowledge Management

To really draw lessons from this project, a monitoring-evaluation mechanism will be put in

place by the executing agencies through the Directorates of Statistics which will be

responsible for monitoring the project and PRSP indicators. Indeed, the definition of key

impact indicators before project start-up and impact assessment at the end of the project will

help to generate useful data on the outputs and outcomes. The lessons, experiences and

knowledge to be drawn from the implementation of this project will be managed from a

database in the executing agencies and WAEMU, and will be disseminated in annual reports

and on the Bank’s Website. The database will effectively facilitate management of all

knowledge acquired during the implementation of project activities.

vii

Results-Based Logical Framework

Country and Project Name: Togo/Burkina Faso - Road Rehabilitation and Transport Facilitation on the Lomé-Cinkansé-Ouagadougou CU9 Corridor

Project goal: Support economic and social development and regional integration

OUTCOME CHAIN

PERFORMANCE INDICATORS MEANS OF

VERIFICATION

RISKS/

MITIGATION MEASURES Indicator

(including ISC) Baseline Case Target

IMP

AC

T

Contribute to the efficiency of

the road transport sub-sector so

as to support implementation

of the Regional Economic

Programme (REP), economic

and social development, and

regional integration in

WAEMU zone

Volume of intra-community

trade in WAEMU zone

10 million tonnes in 2011 19 million tonnes in 2016, representing a

7% annual growth

Statistics prepared by

WAEMU

OU

TC

OM

ES

1. Outcome 1 : Increased

transit traffic on the corridor

Volume of traffic on the

corridor transiting through

PAL to or from Burkina

Faso, Niger and Mali

1.56 million tonnes in

2011

1.91 million tonnes in 2016, or 4%

increase per year

Statistics prepared by the three

hinterland countries (Ministries

in charge of transport,

Shippers’ Councils and

Carriers’ Unions of Burkina

Faso, Mali and Niger), Lomé

Port Authority and project

impact monitoring-evaluation

reports

Risks:

(i) The juxtaposed border checkpoint at

Cinkansé is not fully operational; (ii)

application of axle-load regulations in the two

States is not effective; (iii) persistent

harassment on the corridor due mainly to lack

of a single security for transit operations; and

(iv) delay in upgrading the existing road

funds in both countries to second generation

road funds with sufficient autonomous

resources.

viii

OUTCOME CHAIN


VERIFICATION

RISKS/



2. Outcome 2 : Reduced

general transportation costs on

the Lomé- Ouagadougou CU9

corridor

2.1. Average transit time on

the Lomé – Ouagadougou

corridor by heavy vehicles

2.2. Border crossing time

2.3. Average vehicle

operating cost (light-duty

and heavy vehicles)

2.4. Transit documents

processing time

2.5. Number of check points

2.1. 6 days in 2011

2.2. 2 days in 2011

2.3. In 2011: VOC LDV

= CFAF 219 /km and

VOC HV = CFAF

1.078/km

2.4. 2 days in 2011

2.5. 11 check points

from Ouagadougou to

Lomé and 19 from Lomé

to Ouagadougou

2.1. 3 days from 2016

2.2. 3 hours from 2016

2.3. In 2016 : VOC LDV = CFAF 171

/km and VOC HV = CFAF 784 /km

2.4. 2 hours in 2016

2.5. In 2016, the number of check points

is reduced by 70% minimum compared to

2011

Statistics prepared by the three

hinterland countries (Ministries

in charge of Transport,

Shippers’ Councils and

Carriers’ Unions of Burkina

Faso, Mali and Niger), Lomé

Port Authority and WAEMU

Observatory of Abnormal

Practices.

Transport Facilitation impact

monitoring-evaluation reports

Mitigation Measures

These risks will be mitigated by: (i) the fact

that WAEMU and both States have

undertaken to adopt appropriate measures to

make the check point operational through the

newly established ad hoc commission

comprising all stakeholders; (ii) the fact that

axle-load control is now carried out upstream

by installing axle scales at all loading points

(before exiting Lomé Port, the cement

factory, cargo areas, etc.); (b) installing axle

scales across all West African countries; (c)

securing shipments by accelerating

containerization and sealing which prevent the

modification of shipments during transit; and

(d) management of weighing stations

entrusted to autonomous entities with a

performance contract; and (e) monitoring of

the application of regulations by commissions

in which development partners are

stakeholders; (iii) the regular sensitization of

policy-makers through OPA reports, the goods

tracking and radio-communication system and

the interconnection of customs data processing

systems provided for in the project, as well as

the institution of a single security for transit

operations ; and (iv) the fact that both

countries have undertaken to establish second

generation road funds for which the budgetary

allocation from taxes on petroleum products is

yet to be transformed into a levy with a

mechanism for the direct collection and

payment of resources from the levy into the

3. Outcome 3 : (i)

Mechanisms for the creation of

jobs for youths are

established ; ; and (ii) women’s

living conditions are

improved ; and (iii) improved

accessibility

3. (i) Percentage of the

revenue of Road

Maintenance Funds

allocated each year for non-

mechanized routine

maintenance contracts

signed with youth EIGs or

associations ; (ii) number of

temporary jobs created; (iii)

income generated by

women and percentage of

products and goods

transported on foot by

women ; (iv) percentage of

people in the rural areas of

the PA living two

kilometres away from a

road fit for traffic

3. In 2011 (i) 0% of RF

revenue ; (iii) 30% of

people in the rural areas of

the PA live at two-

kilometre walk from a road

fit for traffic

3. As from 2016: (i) at least 3% of RF

resources are allocated each year for non-

mechanized routine maintenance

contracts signed between RFs and youth

EIGs or associations ; (ii) 500 temporary

jobs are created ; (iii) women’s incomes

increase by at least 20% ; (iv) 50% of

people in the rural areas of the PA live

two kilometres away from a road fit for

traffic

Statistics prepared by the Road

Funds, Ministries of Women’s

Affairs and women’s

associations,

Socio-economic impact

monitoring-evaluation reports

ix

OUTCOME CHAIN


VERIFICATION

RISKS/



4. Outcome 4 : Road accidents

and time taken to provide care

to casualties on the corridor are

reduced

4 Time taken to treat road

accident victims

4 As from 2016, 25% reduction in the

time taken to treat casualties

Statistics prepared by Road

Safety Services of both

countries

Road Fund account. The establishment of this

levy mechanism is being monitored by the

development partners of both countries, and

will be a condition attached to this project.

OU

TP

UT

S

Output 1 : Atakpamé – Blitta -

Aouda and KoupélaBittou –

Cinkansé-Togo Border road

sections are rehabilitated

Road sections rehabilitated N/A

1. (a) 300 km (of which 150 in Burkina

Faso and 150 in Togo) ; (b) 3 km of

Mogandé access roads and 5 km of

paved road network in Tenkodogo in

Burkina Faso

Project appraisal, supervision,

progress, monitoring-

evaluation, audit, completion

and impact assessment reports

Risks:

(i) increase in the cost of works in relation to

the estimated budget; (ii) long procurement

deadlines and delays; (iii) delays in the

mobilization and disbursement of counterpart

contributions by the countries; (iv) fiduciary

risk due to the absence of an accounting

software and delay in recruiting an external

auditor

Mitigation Measures

These risks will be mitigated by: (i) the

availability of comprehensive implementation

studies updated in 2011, a realistic cost

estimate based on similar work contracts

launched between 2010 and 2011, sufficient

provision for price escalation, Advance

Procurement Actions that will reduce the time

between the conduct of studies and the start-

up of works, and measures taken to ensure

broad competition during bidding; (ii)

provision of support to the executing agencies

in both countries by a technical assistance that

will provide a procurement expert in good

time and close assistance by the Bank’s

offices in both countries to the executing

Output 2 –

1. Related works carried out

1. (i) Rural road section

and bridge; (ii) number and

surface area of rest areas and

parking lots; (iii) number of

socio-economic facilities

built or rehabilitated; (iv)

number of interim transport

modes, and agricultural and

fish products processing units

provided; and (v) number of

temporary jobs created

N/A

2. (i) 42 km in Burkina Faso and 65 km

and a 120m-long bridge at Alemondji in

Togo; (ii) 10 ha of rest area for drivers

on the corridor in Burkina Faso and 10

ha of parking lot extension at Adétikopé

for the Port in Togo; (iii) 2 CPFs in

Burkina and 2 CPFs in Togo, 10

information stands with 5 in each

country and 1 market at Anié in Togo;

(iv) two blocks with ambulance

equipped at Dapaong and Sokodé in

Togo and one block and 2 ambulances

equipped at Tenkodogo and Zorgho; and

(v) lots of small interim transport modes

and UTA for women’s groups in

Burkina Faso; 500 jobs created

Output 3 : Sensitization on

road safety, environmental

protection, and HIV/AIDS and

compliance with axle load

regulations carried out

Number of people

sensitized on HIV/AIDS,

environmental protection,

and road safety

N/A

3. At least 1000 people are sensitized by

2016

x

OUTCOME CHAIN


VERIFICATION

RISKS/



Output 4 : Feasibility studies

on the rehabilitation of Lomé-

Blitta railway line and a dry

port at Bllitta in Togo,

feasibility studies on the

Ouagadougou dry port in

Burkina Faso ; studies on the

development of public works

sector SMEs in Burkina Faso

and Orodara-Kpuéré (361km)

road in Burkina Faso and

studies on PPP activities to be

carried out under the project

are conducted

Final study reports

N/A

4. (i) 5 study reports are validated agencies will likely mitigate these risks; (iii)

the fact that since Burkina Faso is eligible for

full financing (100%) of the project cost

(exclusive of tax and custom duty) by the

Bank, its counterpart contribution to

components to be funded by ADF was

reduced to bearing the operating costs of the

Project Implementation Monitoring Unit since

the country is eligible for 100% project

financing by the Bank. Concerning Togo, the

expected total counterpart contribution for the

entire project of about CFAF 7.6 billion, or

about CFAF 2 billion annually, is bearable

when compared to CFAF 2.3 billion spent

each year on the maintenance of road sections

of the corridor. To secure counterpart

resources, the opening of a counterpart

contribution account and its regular

replenishment with resources is a condition for

this project; (iv) the project provides for the

procurement of accounting software and

training in its use, as well as the reinforcement

of PIMUs by accountants and bookkeepers.

Output 5 : The training of

youths in road maintenance

through training worksites is

carried out

Number of youths trained in

road maintenance

0 5. (ii) At least 200 youths trained in road

maintenance

Output 6 : A system for real

time tracking by GPS

technology and radio-

communication of the

movement of cargo in transit is

established

Coverage in km of the cargo

tracking and radio-

communication system

0 km 6. At least 1400 km of Lomé-

Ouagadougou-Niamey highway are

completely covered by a single cargo

tracking and radio-communication

system installed on the corridor

Output 7 : Customs capacity

built

(i) Rate of computerization

of customs operations; (ii)

customs data processing

systems of both countries are

interconnected and improved

to cover transit; and (iii)

number of customs officers

and stakeholders of the

transport system trained.

(i) The customs data

processing systems of both

countries are not yet

interconnected

7. (i) All customs documents on transit

on the corridor are processed by

computer; (ii) Migration to ASYCUDA

customs data processing systems and

the interconnection of the customs data

processing systems of Togo and Burkina

Faso are effective, and double customs

declarations at the border are

eliminated; (iii) 300 customs officers as

well as customs clearing agents and

operators of the transport sector are

trained on the use of ASYCUDA

xi

OUTCOME CHAIN


VERIFICATION

RISKS/



Output 8: Capacity of

executing agencies

strengthened and project

monitoring-evaluation and

auditing carried out

(i) Number of equipment;

(ii) number of support

experts; and (iii) number of

reports produced and

validated

(i) 5 computer hardware sets and 4

vehicles procured for each executing

agency and 5 computer hardware sets for

project monitoring officers of the project

donors at DGCOOP in Burkina Faso; (ii)

2 long-term experts and short-term

experts made available to each executing

agency; (iii) 4 financial audit reports per

country; 2 technical audit reports per

country; a baseline case report and an

impact report per country at project

completion, a transport facilitation

baseline case report and an impact report

at project completion are produced

AC

TIV

ITÉ

S C

LÉ

S

COMPONENTS

1.Road Works

2. Related Works

3. Support for Transport and Regional Trade Facilitation

4. Support for the Transport Sector

5. Support for Project Management

RESOURCES IN UAMILLION

Road Works: 178.04

Related Works: 14.51

Support for Transport Facilitation: 12.01

Support for the Transport Sector: 5.97

Support for Project Management: 2.16

Provision for Physical Contingencies and Price Escalation : 37.78

TOTAL RESOURCES: 250.47

xii

Implementation Schedule

1

REPORT AND RECOMMENDATION FROM MANAGEMENT TO THE BOARDS OF

DIRECTORS CONCERNING PROPOSED GRANTS AND LOANS TO TOGO AND BURKINA

FASO TO FINANCE THE PROJECT FOR ROAD REHABILITATION AND TRANSPORT

FACILITATION ON THE LOMÉ-CINKANSE-OUAGADOUGOU CU9 CORRIDOR

Management submits the following report and recommendation concerning a proposal for the award

of: (i) a UA 30.23 million ADF grant to Togo and a UA 84.60 million grant to Burkina Faso; (ii) a UA

17.80 million ADF loan to Togo and a UA 21.53 million loan to Burkina Faso; and (iii) a UA 21.50

million FSF grant to Togo to finance the Project for Road Rehabilitation and Transport Facilitation on

the Lomé-Cinkansé-Ouagadougou CU9 Corridor.

1 PROJECT STRATEGIC THRUST AND RATIONALE

1.1 Project Linkages with Regional and National Strategies and Objectives

This project falls within the WAEMU transport sector strategy one of whose key missions is to facilitate

the promotion of inter-State land transportation corridors, in particular sea access roads for the three

landlocked WAEMU Member States. Hence, it is included in the Community Road Transport

Infrastructure Action Programme (PACITR) and is therefore part of the Union’s eleven priority

corridors. The WAEMU Commission has financed the technical, economic and environmental

feasibility studies on the Atakpamé-Kara road section on the corridor in Togo, as well as the

construction of the Juxtaposed Check Point at Cinkansé in Burkina Faso, at the border with Togo. The

project is also in line with the ECOWAS Transport Facilitation Programme, which seeks to foster cross-

border movement.

The project is also consistent with Togo’s Poverty Reduction Strategy Paper one of whose priority

thrusts is operations in the transport sector and more precisely the Lomé-Cinkansé (RN1) corridor. It is

in line with Burkina Faso’s Accelerated Growth and Sustainable Development Strategy (SCADD)

which mainly seeks to open up the country by developing road infrastructure and improving the

transport logistic chain. The project is also consistent with the transport sector visions and policies of

both countries and the Regional Economic Communities, namely WAEMU and ECOWAS.

1.1.3 The project is consistent with the Bank’s Strategy Paper for Togo (CSP 2011-2015), one of

whose two pillars is “economic infrastructure development”. This pillar’s objective is to more

effectively connect economic zones within Togo and the Togolese economy to the West African

regional economic space so as to boost economic growth. This project is also fully in line with

Burkina Faso’s 2012-2016 CSP whose first pillar is “the development of core economic infrastructure

to boost growth”

1.2 Rationale for Bank’s Involvement

The Bank’s involvement is justified by the fact that: (i) the project is consistent with its medium-term

strategy (MTS) for the 2008-2012 period which prioritizes infrastructure while also laying emphasis on

regional integration and the fragile States ; (ii) the Lomé-Ouagadougou corridor is one of the major

international highways opening up Burkina-Faso and therefore plays a key role in its economic

development; and (iii) it plays a leading role in the implementation of NEPAD activities and it has many

years of experience in the implementation of regional projects.

2

The Bank’s involvement in the project is also justified by the fact that it is in line with the Bank’s

Regional Integration Strategy Paper (RISP) for West Africa (2011-2015) whose first pillar is

“connection of regional markets” and is included in the RISP indicative programme. This document

indicates that the integration of transport, energy and telecommunication infrastructure services is an

important complement to markets, goods and factors integration policies. The project is also in keeping

with the Programme for Infrastructure Development in Africa (PIDA) because of its importance for

regional integration, its technical and economic feasibility, its preparation which is totally completed

and its impact on the economic development of the area. The project complements the action of

development partners (Accra-Ouagadougou-Bamako, Bamako-Conakry, Bamako-Dakar, etc. corridors)

and WAEMU (Cinkansé, Malanville, etc. PCJ) in the sub-region to strengthen sea access facilities for

landlocked countries (Almaty Agreement).

This project is also backed by ECOWAS and WAEMU letters of support, as well as a joint request by

the Togolese and Burkina Faso Governments. The Bank’s involvement in this project will strengthen its

last actions on the corridor, particularly the Lomé-Notsé Road Rehabilitation Project in Togo before the

crisis in the 2000s and the Bank’s private sector loan in 2011 to extend the container terminal of the

Lomé Port Authority (PAL). It will complement the actions of other donors (China, WADB, EU, etc.)

that funded sections of the corridor and WAEMU which financed the construction of the juxtaposed

border check point at Cinkansé.

1.3 Donor Coordination

In Togo, the authorities established an institutional mechanism for development policy coordination,

monitoring and evaluation (DIPD) in December 2010. Within this context, a formal donor coordination

mechanism for sector growth support infrastructure was established. In the transport sector, Togo has no

sector programme or a formal partner coordination mechanism. The Bank is funding a transport sector

development strategy study which is expected to be completed at end 2012. However, in the meantime,

the Bank, which was designated as lead Technical and Financial Partner in the sector and Vice-Chair of

the Infrastructure Sector Committee, is in regular contact with all the development partners. The Bank’s

Office in Togo, which played an active role in mobilizing co-financiers (EBID and WADB), will help to

strengthen coordination.

In Burkina Faso, aid is coordinated through the General Directorate of Cooperation within the Ministry

of the Economy and Finance. In the transport sector, coordination is ensured through the Transport

Sector Programme and periodic coordination meetings between donors in the sector. TFPs active in

Burkina Faso are organized around a troika, which acts as an interface with the Government for dialogue

on the Accelerated Growth and Sustainable Development Strategy (SCADD). As regards infrastructure,

the theme “Economic Infrastructure” of the Sector and Thematic Commission (CST) serves as a sector

consultation framework, and the proximity of the Bank’s Office in Burkina Faso will help to strengthen

coordination.

In WAEMU, coordination is carried out through the Regional Economic Programme and Community

Infrastructure and Road Transport Steering Committees of Member States. This second Committee

comprises the representatives of the transport system stakeholders of Member States and donors in the

sector. In addition, for the implementation of this project, a Joint Technical Committee will be set up,

3

and donors will, as at project appraisal, undertake joint supervision and mid-term review missions.

2 PROJECT DESCRIPTION

2.1 Project Objectives and Components

The present situation is as follows: (i) 38% of the corridor road is in a bad or very bad condition ; (ii) the

juxtaposed border check point at Cinkansé the construction and equipping of which was totally financed

by WAEMU is entrusted, in concession, to a private operator but it is not yet fully operational; (iii) there

are persistent customs controls, despite improvements, because of problems associated with the lack of a

single security for transit operations, the interconnection of the customs data processing systems of both

countries which is not yet effective, and the lack of a GPS goods tracking system (for details on

constraints related to transport facilitation, see Technical Annex A.4).

The project’s objective is to help lift the above-mentioned barriers so as to contribute to the efficiency of

the road transport sub-sector, as well as foster economic and social development and integration in West

Africa. To achieve this objective, the project activities are grouped into five components summarized in

the table below.

Table 2.1: Project Components

No. Component Name Estimated Cost

in UA Million

Component Description

A REHABILITATION OF

THE CORRIDOR

ROADS

209.80 A.1 - In Togo : (i) Rehabilitation of the Atakpamé-Blitta (102

km) and Blitta-Aouda (48 km) road sections;

A.2 - In Burkina Faso: (i) Rehabilitation of the Cinkansé-Bittou-

Koupéla road section (150km) and development of 3 km of

Mogandé access road;

A.3 - In both countries : (i) environmental impact mitigation

measures; (ii) sensitization on STIs-HIV/AIDS, road safety and

compliance with axle load; and (iii) works control and

supervision

B RELATED

FACILITIES

17.09 B.1 - Development of related rural roads in Togo (55 km) and

reconstruction of the 120-metre bridge at Alémondji and its

access roads and in Burkina Faso (42 km);

B.2 - Development of 5 km of paved roads at Tenkodogo in

Burkina Faso

B.3 - Rehabilitation of social infrastructure;

B.4 - Support to women in the form of interim transport

modes and agricultural products processing units;

B.5 - Road safety support, including the construction of rest

areas for drivers on the corridor in Burkina Faso and the

construction of equipped blood transfusion blocks (CTS) in

both countries;

B.6 - Related works control and supervision

C TRANSPORT AND

TRANSIT

FACILITATION

ACTIONS AND

MEASURES

14.16 C.1. Support for the Customs Data Processing System, and

training of customs officers and customs clearing agents of both

countries

C.2. Studies to prepare documents for the establishment of PPPs

under the project

4

C.3. Installation of goods tracking and radio-communication

facilities on the corridor through a PPP

C.4. Support for Lomé Port Authority (Relocation of the parking

lot for used vehicles to Adipoké through PPP) in Togo

C.5. Supply and installation of axle-load scales in both countries

C.6. Control and supervision of road transport and transit

facilitation works in both countries

C.7. Monitoring-evaluation of transport facilitation impacts in

both countries

D INSTITUTIONAL

SUPPORT FOR THE

TRANSPORT SECTOR

7.04 D.1 - Study on the rehabilitation of the Lomé-Blitta railway line

and a dry port at Blitta in TOGO

D.2 - Feasibility study on the Ouagadougou dry port in Burkina

Faso

D.3 - Study on the development of public works and civil

engineering SMEs in Burkina Faso

D.4 - Final design of the Orodara-Kpuéré road (361km) in

Burkina Faso

D.5 - Technical assistance to DGR of MID in Burkina Faso and to

the Ministries of Transport and Public Works of Togo

D.6 - Support for the Youth Employment Creation Programme

E PROJECT

IMPLEMENTATION

MANAGEMENT AND

MONITORING

2.38 E.1 - Project socio-economic impact monitoring-evaluation

E.2 - Technical, road safety, accounting and financial audits

E.3 - Equipping of Executing Agencies

E.4 - Operation of Executing Agencies

E.5 - Operation of the Joint Technical Committee (CTM)

2.2 Technical Solution Adopted and Alternatives Explored

Initial studies on the project roads were conducted between 2006 and 2009, and then updated in 2011. In

Togo, the geometric features of the horizontal alignment of the road were maintained except at the

entrance to the town of Blitta, where they were improved to ensure the safety of users and roadside

dwellers. The road surface will consist of: (i) a sub-base course of an average thickness of 20 cm

obtained by the in situ recycling of the existing pavement plus fill materials and its treatment with

cement; (ii) a 10 cm thick coarse aggregate asphalt base course; and (iii) a 5 cm thick bituminous

concrete coating. Under the project, 55 km of rural roads will be rehabilitated, and the bridge

reconstructed with reinforced concrete at Alemondji with its 10 km of access roads.

In Burkina Faso, the geometric features of the horizontal alignment of the Koupéla – Bittou -

Tenkodogo – Cinkansé –Togo Border road were maintained. The road surface will consist of: (a)

Koupéla – PK 76,00 Section : (i) a sub-base course of an average thickness of 20cm obtained by the in

situ recycling of the existing pavement plus fill materials and its treatment with cement; (ii) an 8 cm

thick coarse aggregate asphalt base course ; and (iii) a 5 cm thick bituminous concrete costing; (b) PK

76,00 to PK 149,328 Section and the 3 km of Mogandé access road: (i) a laterite gravel sub-base course

of an average thickness of 20 cm and its treatment with cement after stripping the existing coating and

base course; (ii) an 8 cm thick coarse aggregate asphalt base course; and (iii) a 5 cm thick bituminous

concrete coating. In Burkina Faso, the project also provides for the construction of 6 concrete bridges

and 5.2 km of pavestone urban roads, as well as the rehabilitation of 42 km of rural roads.

The technical alternative solutions explored and reasons for their rejection are summarized in Table 2.2

5

below.

Table 2.2: Alternative Solutions Explored and Reasons for Rejection

Alternative Solution Brief Description Reason for Rejection

TOGO

Crushed aggregate base course

The base course will be

composed of crushed aggregate

instead of bituminous aggregate

(i) Durability of the pavement system deemed

to be less compared to a bituminous aggregate

base course, especially considering the traffic

comprising mainly heavy vehicles; (ii)

difficulties in in situ implementation of a

homogeneous mixture of the final material; and

(iii) cost margin between the proposed solution

and the alternative solution not very significant

BURKINA FASO

Crushed aggregate base course

The base course will be

composed of crushed aggregate

instead of bituminous aggregate

(i) Durability of the pavement system deemed

to be less compared to a bituminous aggregate

base course, especially considering the traffic

comprising mainly heavy vehicles; (ii)

difficulties in in situ implementation of a

homogeneous mixture of the final material; and

(iii) cost margin between the proposed solution

and the alternative solution not very significant

BURKINA FASO

A 40 cm sub-base course

obtained by treatment of 25 cm

lateritic aggregate on the spot

and 15cm cement-treated

borrow lateritic aggregate

This solution is different from

the one adopted ; a new cement-

treated sub-base course will be

implemented after stripping the

existing coating and base course

2.3 Project Type

This project is an investment operation. Donor operations in transport infrastructure in Togo and

Burkina Faso are generally implemented through this type of operation. Some activities will be

implemented through Public Private Partnership.

2.4 Project Cost Estimates and Financing Arrangements

Project Cost by Component

The overall project cost (exclusive of tax and customs duty), including provision for physical

contingencies and price escalation, is estimated at UA 250.47 million, equivalent to CFAF 185.34

billion, at an exchange rate of UA 1 = CFAF 743.009.

Table 2.3: Project Cost Estimates by Component (in UA million)

Component Foreign

Exchange

Local

Currency Total

% Foreign

Exchange

A – Road Rehabilitation 142.42 35.62 178.04 80.00%

B- Related Facilities 11.61 2.90 14.51 80.00%

C – Transport Facilitation 9.61 2.40 12.01 80.00%

D- Institutional Support for the Transport

Sector 4.78 119 5.97 80.00%

E – Project Management 0.92 1.24 2.16 42.69%

6

Base Cost 169.33 43.35 212.69 79.62%

Provision for physical contingencies 16.89 4.27 21.16 79.81%

Provision for price escalation 13.25 3.37 16.62 79.74%

Total 199.48 50.99 250.47 79.64%

Financing Arrangements

The project will be jointly financed by the Bank (ADF – Togo and Burkina Faso country allocations,

resources from cancelled loans and grants, resources allocated to regional operations and FSF); IsDB,

KFW, WADB, EBID, private operators, EU-Africa Infrastructure Trust Fund, WAEMU, UNFPA and

the Governments of Burkina Faso and Togo, as indicated in Tables 2.4 and 2.5 below. The Bank is in

joint financing with KFW and in parallel financing with the other donors. The EBID and the Bank

appraised the project at the same time. The WADB appraised the project in April 2012 with a view to

presenting it to its Board of Directors before the end of 2012. The IsDB is expected to confirm its

contribution to the financing of the project in November 2012. The WADB loans to both Governments

and, to some extent, those of the EBID, will be subsidized by WAEMU in order to make them more

concessional. Confirmation of mobilization of the financing of other donors is a condition for this

project.

Since Burkina Faso is eligible for 100% project financing by the Bank, its counterpart contribution to

the financing of components funded by the ADF has been reduced to payment of the operating costs of

the Project Implementation Monitoring Unit (for justification see Technical Annex A.4). Togo’s

counterpart contribution to components financed by the Bank in Togo (UA 7.61 million) accounts for

10.94% and will be used in paying the operating costs of the Project Implementation Monitoring Unit,

part of the cost of road works, and compensation expenses. The opening of counterpart contribution

accounts and their regular replenishment with resources from both countries is a condition for

this project.

Table 2.4: Project Sources of Financing (in UA million)

Sources of Financing UA Million

% Foreign Exchange Local Currency Total

ADF GRANT 94.69 20.15 114.84 45.85%

ADF LOAN 32.70 6.62 39.32 15.70%

FSF GRANT 19.68 1.82 21.50 8.58%

IsDB LOAN 8.38 1.08 9.46 3.78%

KFW GRANT 6.34 1.58 7.92 3.16%

EU-AFRICA TRUST FUND 1.64 0.41 2.06 0.82%

PRIVATE OPERATORS 2.88 0.72 3.60 1.44%

WADB 22.18 1.77 23.95 9.56%

EBID 10.84 2.71 13.56 5.41%

WAEMU 0.93 0.93 0.37%

UNFPA 0.14 0.03 0.17 0.07%

Government of TOGO 10.50 10.50 4.19%

Government of BURKINA FASO 2.66 2.66 1.06%

Total 199.48 50,.99 250.47 100%

7

Table 2.5: Project Cost by Expenditure Category (in UA million)

Expenditure Category

UA Million % Foreign

Exchange Foreign Local

Currency Total

A – Goods 2.00 0.50 2.50 80.00%

B –Works 151.80 37.95 189.75 80.00%

C – Services 14.03 3.51 17.54 80.00%

D – Miscellaneous 1.51 1.40 2.90 51.92%

BASE COST 169.33 43.35 212.69 79.62%

Provision for physical contingencies 16.89 4.27 21.16 79.81%

Provision for price escalation 13.25 3.37 16.62 79.74%

COUT TOTAL 199.48 50.99 250.47 79.64%

Table 2.6: Project Expenditure Schedule by Component (in UA million)

Component 2012 2013 2014 2015 2016 Total

A – Road Rehabilitation 0.01 47.25 65.86 57.72 7.19 178.04

B- Related Facilities 2.90 4.35 5.80 1.45 14.51

C – Transport Facilitation 0.32 1.07 4.51 4.17 1.94 12.01

D- Institutional Support for the Transport

Sector 0.73 1.56 2.03 1.48 0.19 5.97

E – Project Management 0.51 0.60 0.36 0.32 0.36 2.16

Base Cost 1.57 53.37 77.12 69.50 11.14 212.69

Provision for physical contingencies 0.16 5.31 7.67 6.91 1.11 21.16

Provision for price escalation 0.12 4.17 6.03 5.43 0.87 16.62

Total 1.85 62.84 90.82 81.85 13.12 250.47

Total in % 0.74% 25.09% 36.26% 32.68% 5.24% 100.00%

Table 2.7: Project Expenditure Schedule by Source of Financing (in UA million)

Sources of financing 2012 2013 2014 2015 2016 Total

ADF GRANT 1.11 31.75 44.13 35.26 2.60 114.84

ADF LOAN 11.79 15.73 11.81 39.32

FSF GRANT 0.13 5.73 7.81 7.04 0.79 21.50

IsDB LOAN 1.89 3.78 3.78 9.46

KFW GRANT 2.38 3.17 2.38 7.92

EU-AFRICA TRUST

FUND 0.41 0.62 0.62 0.41 2.06

PRIVATE OPERATORS 1.44 1.44 0.72 3.60

WADB 4.79 7.19 9.58 2.40 23.95

EBID 2.71 4.07 5.42 1.36 13.56

WAEMU 0.02 0.06 0.33 0.33 0.20 0.93

UNFPA 0.05 0.05 0.03 0.03 0.17

Government of TOGO 0.09 2.44 3.64 3.40 0.93 10.50

Government of

BURKINA FASO 0.10 0.53 0.75 0.97 0.32 2.66

Total 1.85 62.84 90.82 8.85 13.12 250.47

Total in % 0.74% 25.09% 36.26% 32.68% 5.24% 100%

8

2.5 Project Area and Beneficiaries

The corridor extends from the Lomé Port up to Ouagadougou, thus covering National Highway No. 1 in

Togo and National Highway No. 16 in Burkina Faso. The works concerning transport facilitation and

development of related facilities will be carried out along the corridor, that is in the 5 regions of Togo

and in the Centre, Centre-East and Central Plateau Regions of Burkina Faso. Regarding road works, the

project direct impact area (PIA) is located in the Plateaux and Central Regions in Togo, as well as the

Centre-East Region in Burkina Faso. The PIA population covered by the project is 1 993 036

inhabitants, with 1 006 402 women in Togo, and 1 223 956 inhabitants with 649 122 women in Burkina

Faso. Most of the people are women (51%) and especially youths aged less than 30 years (about 70% of

the population) who are hard hit by unemployment and underemployment. However considering the

regional nature of the project, the extended impact area covers Togo and a large part of Burkina Faso,

Mali and Niger.

The incidence of poverty is fairly high in the PIA: the poverty prevalence rate is 77.7% in Central

Region and 56.2% in Plateaux Region in Togo, while it stands at 46.6% in Burkina Faso. Most of the

PIA is located in rural areas, even though some of the places are urban centres. The main economic

activity of the project area is agriculture, which employs about 80% of the working population in both

countries, followed by trade. This predominance of agricultural employment is characterized by

seasonal unemployment and low productivity.

The project will have a significant positive impact on the activities of the PIA population in general and

on those of women and youths, in particular, as it will improve their employability, increase job offers in

the public works and civil engineering sector, strengthen commercial activities, enhance socio-economic

infrastructure accessibility, and reduce travel time and general transportation costs. The most significant

expected positive outcomes are : (i) improvement of transportation conditions and access to basic social

services, markets and production zones for the conveyance of products and goods through roads, road

networks, rural roads and structures rehabilitated by the project ; (ii) better knowledge of best practices

relating to road safety, reproductive health, micro-business management techniques, environmental

safety and risk of the spread of STIs through sensitization campaigns and information kiosks; (iii)

increase in the incomes of youths and women as a result of training and creation of employment

opportunities; (vi) construction of secured marketing infrastructure at Anié which will improve

conditions under which women sell their products; and (vii) better management of road accident victims

as a result of the construction of equipped blood transfusion centres.

2.6 Participatory Approach to Project Identification, Design and Implementation

During the updating of studies in the two countries and Bank preparation and appraisal missions,

participatory meetings were organized in Lomé and Ouagadougou, as well as in the regions crossed by

the road so as to identify the needs and concerns of the beneficiaries. The meetings were organized with

WAEMU, all services of ministries and government agencies operating in the transport sector, the local

population, stakeholders of the transport system, the civil society, donors and development partners

operating in the transport sector. During all the meetings, efforts were made to: (i) collect available

information and data to analyze the sector situation; (ii) collect information on donor operations so as to

avoid duplication and strengthen coordination; and (iii) define the project components based on the

9

needs, strategies and priorities. During project implementation, this collaboration will be pursued,

particularly for the implementation of facilitation measures and related facility works, preparation of

training programmes for youths and women under national employment creation programmes, as well

as for validation of the various study reports. In both countries, the Project Implementation Monitoring

Units (PIMU), control firms and contractors should, depending on their respective prerogatives, enlist

the services of the various stakeholders so as to facilitate implementation and ownership of the project

outcomes.

2.7 Bank Group Experience and Lessons Reflected in Project Design

This project draws on the Bank’s great experience in implementing multinational infrastructure projects,

the main difficulties of which are associated with: (i) the multiplicity of project players who generally

have weak technical and operational capacity; and (ii) country and REC weaknesses in procurement,

mobilization of counterpart contributions and performance monitoring. To remedy these inadequacies,

the project intends to provide support to existing project management units in each country and to the

Joint Technical Committee (CTM) of the project.

The Bank’s active portfolio in Togo, following resumption of cooperation based on the interim strategy

(I-CSP), comprises five projects, including one road project. Lessons learned from the implementation

of the interim strategy include the need to take into consideration the fragile nature of institutions in

formulating and implementing operations in Togo. Furthermore, the scope of challenges to be faced

requires the strengthening of synergies between development partners through formal and more frequent

consultations so as to encourage the country to conduct reforms that would enable the transport sector to

play its role as catalyst for growth and poverty reduction. The Bank has already mobilized financing to

support the Government in developing a transport sector programme. The reports of the study, which are

expected at the end of 2012, will help to establish a more efficient consultation framework for partners

involved in the sector. The design of this project took institutional weaknesses into consideration, and

provided for technical assistance to support the Ministries of Public Works and Transport in

procurement and monitoring of project implementation. The assistance of the Bank’s Country Office

will help to ensure closer project monitoring.

The Bank’s active portfolio in Burkina Faso comprises a total of sixteen operations, including two

national transport and two multinational projects. Lessons learned from completed and ongoing projects

can be summarized as follows: (i) delays in the procurement process; (ii) poor quality of studies; (iii)

delays in the disbursement of counterpart contributions for investments, as well as equipping and

operation of Project Implementation Units; and (iv) dispersal and great mobility of Project Officers. For

this project, the following mitigation measures: (i) technical assistance to support procurement and

implementation monitoring, as well as reinforced monitoring of project progress by the Bank’s Country

Office; (ii) availability of comprehensive implementation studies updated in 2011 and a realistic cost

estimate based on similar construction contracts under execution (in 2010 and 2011) and a provision for

price escalation and physical contingencies during project implementation; (iii) the counterpart

contribution was reduced and its effective mobilization will be followed up ; and (iv) the establishment,

within the DGR, of a Project Monitoring Unit which will be exclusively responsible for the project, and

for which the Bank has given its no-objection opinion on the staff CVs.

10

2.8 Key Performance Indicators

The identified key performance indicators and expected outcomes at project completion figuring in the

results-based logical framework are as follows : (i) volume of intra-community trade in WAEMU Zone;

(ii) volume of traffic on the corridor transiting through PAL to or from Burkina Faso, Niger and Mali ;

(iii) average transit time of the Lomé – Ouagadougou corridor by heavy vehicles, border crossing time,

average vehicle operating cost, transit documents processing time, and number of check points on the

corridor ; (iv) percentage of revenue of Road Maintenance Funds allocated each year for non-

mechanized routine maintenance contracts signed with youth EIGs or associations; (v) number of

temporary jobs created ; (vi) women’s income generated by agricultural produce processing activities

and/or activities initiated following practical training in CPFs; (vii) percentage of people in the rural

areas of the PIA living two kilometres away from a road fit for traffic; and (viii) time taken to treat road

accident victims. The baseline case for these indicators as defined in the logical framework will be

verified, and an evaluation will be conducted at mid-term and at the end of the project by the General

Directorate of Statistics and National Accounts (DGSCN) in Togo, the National Institute of Statistics

and Demography (INSD) in Burkina Faso, and a consulting firm to be recruited by WAEMU to monitor

indicators related to transport facilitation.

Apart from these output and outcome indicators in the logical framework, there are also project

implementation performance indicators which will be monitored. They were retained in line with the

Bank’s institutional performance indicators; they are: (i) deadline for effectiveness and fulfilment of

conditions precedent to the first disbursement of funds; (ii) procurement deadlines; (iii) average project

status indicator (IP); and (iv) disbursement rate trend in relation to the expenditure schedule. These

indicators will be monitored during supervision missions and in the day-to-day management of the

project.

3 PROJECT FEASIBILITY

3.1 Economic and Financial Performance

The economic evaluation was carried out using the HDM IV model based on a cost/benefit analysis

between the without- and with-project situations over a 20-year period, and a 12% discount rate. This

evaluation resulted in economic rates of return (ERR) per road section varying from 24% to 35%, and a

Net Present Value (NPV) varying from CFAF 11 to 58 billion depending on the road section. Details on

each section are provided in the table below. A sensitivity test (a 10% increase in project cost and a 10%

reduction in benefits) shows the ERR varying from 20% to 27% depending on the road section. The

project is therefore economically viable. The table below summarizes the project economic analysis; the

detailed analysis is appended hereto.

11

Table 3.1: Summary Economic Analysis

Economic

Parameters

Analyzed

Atakpamé-

PK54

(Togo)

PK54-

Blitta

(Togo)

Blitta-

PK135

(Togo

PK135-

Aouda

(Togo)

Aouda-

Sokodé-

Kara

(Togo)

Koupéla/

Tenkodo

go

(Burkina

Faso)

Tenko

dogo-

PK76

(Burki

na

Faso)

PK76-

Cinkan

sé

(Burkin

a Faso)

Economic Rate of

Return (ERR) 35% 35% 24% 28% 29% 27% 29% 27%

Net Present Value

(NPV) in CFAF

Billion

58 52 21 11 33 39 20 50

ERR Sensitivity Test

(+10% variation in

costs and -10% in

benefits)

27% 27% 20% 23% 24% 23% 26% 24%

3.2 Environmental and Social Impacts

Environment

The project is classified by the Bank under Environmental Category 2, taking into account: (i) the nature

of works to be undertaken (rehabilitation of existing roads with the route being more or less the same,

except at a few specific places for reasons of safety and average size of works); (ii) the location of the

project in relatively environmentally-insensitive areas; and (iii) the low intensity of direct and indirect

impacts that the project can generate. Comprehensive environmental and social impact assessments with

their Environmental and Social Management Plans (ESMP) were prepared and validated by the Burkina

Faso and Togolese Ministries in charge of the Environment. The project’s ESMP was posted on the

Bank’s Website on 10 May 2012.

The negative environmental impacts can be easily mitigated and limited to the construction period. In

each country, 120 ha of compensatory planting is recommended on hillsides and areas prone to erosion,

as well as borrow sites to be restored. Roadside trees will be planted along the entrances and exits of

towns concerned by road works (Atakpamé, Blitta, Sotouboua and Sokodé for Togo, and Koupela,

Liguidi-Malguem, Kampayargo, Lioulgou, Mogande, Bitou and Tenkodogo for Burkina Faso) using the

labour-intensive approach recommended by national youth employment programmes; they will

embellish the road landscape and create income-generating activities for youths.

Road Safety

The Lomé-Ouagadougou Road Corridor is one of the most accident-prone in the sub-region for several

reasons: (i) the existence of dangerous areas such as the Alédjo and Défalé faults in Togo where the

geometric features of the road do not comply with accepted norms and standards; (ii) the behaviour of

drivers and state of vehicles; and (iii) lack of adequate mechanisms for the rapid evacuation and

treatment of road accident victims. In March 2010, the United Nations General Assembly adopted

Resolution A/RES/64/255 in which it proclaimed 2011-2020 the Decade of Action for Road Safety so as

to stabilize and then reduce the number of deaths due to road accidents worldwide by intensifying

sensitization campaigns at national, regional and global levels. Accordingly, efforts have been initiated

12

on the corridor with ongoing construction of road sections bypassing the critical sections with faults in

Togo, with financing from Eximbank of China.

The project design includes measures to improve road safety through: (i) compliance with road safety

regulations and technical standards in force concerning road signs, slopes, road banking and deviations;

(ii) the construction of driveways in temporary parking lots and roadside rest areas for drivers; (iii) road

safety sensitization campaigns for road users and the local population; and (iv) the conduct of road

safety audits at start-up, during and after completion of works. To ensure expedient treatment of road

accident victims, the project, in agreement with WHO, intends to support health facilities located along

the corridor (Dapaong and Sokode in Togo, and Tenkodogo and Zorghoau in Burkina Faso) by

constructing Blood Transfusion Centres (BTC) with small blocks equipped with a blood bank and an

ambulance. The recurrent costs will be subsequently be borne by the Governments with WHO support.

Climate Change

Climate change was considered during project design, with the boxing up of the road and sizing of water

supply structures taking into account the rainfall pattern in the project area. Furthermore, concerning

road works, the following measures will help to mitigate the effects of climate warming: (i) restoration

of borrow pits along the road and related rural roads through systematic tree planting and plant

regrowth, and (ii) planting of trees on both sides of the road. About one hundred hectares of hillsides and

erosion-prone areas as well as borrow pits to be restored will be reforested.

Gender Issues

In Togo and Burkina Faso, women account for 51% of the PIA population as against 49% for men.

According to the latest study on poverty and vulnerability in Togo conducted in 2007, the

unemployment rate for women (9.9%) is much higher than for men (5.6%). Agriculture and trade are the

main activities carried out by women in Togo. In the agricultural sector, Togolese women earn only

10% of the income derived from the fruits of their labour. This is due to unequal access to the means of

production. Trade is the main source of income for 53.2% of Togolese women.

Poverty in Burkina Faso mostly affects the rural population and women. The incidence and severity of

poverty are higher among women than men (52% as against 48%). This inequality stems from the

economic marginalization of women, especially in rural areas where their living conditions are

particularly affected by limited access to inputs compounded by the level of inaccessibility of the area

and lack of means of transportation. The marketing of agricultural produce is an important source of

income and employment for urban women in the centre-east region.

The health situation of women in the PIA is rather alarming. Some 72% of women in the Burkina Faso

PIA mentioned lack of money for treatment and 54% distance to a health service as major impediments

to access to health care. The rate of HIV prevalence among women (1.6%) is almost twice the rate

among men (0.9%). There is also a high rate of HIV/AIDS prevalence among women in Togo. An

estimated 30.5% of Togolese girls aged 15 to 19 are infected compared to 8.1% of boys in the same age

group.

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The project implementation will have a positive impact on the status of women by: (i) improving access

to socio-economic infrastructure, particularly health centres; (ii) increasing women’s incomes,

particularly during the operation phase by facilitating the sale of goods and supply of inputs. To

strengthen the positive impacts of the project in terms of economic empowerment of women, the

following measures have been taken: (i) the construction and rehabilitation of four women's centres

(CPFs) along the corridor; (ii) the installation of information kiosks for women and other users along the

corridor dealing with all issues related to inter-State transit; (iii) the construction of equipped modules

in Anié market to increase women's incomes; and (iv) the provision of interim modes of transportation

and minor equipment for the processing of agricultural produce for women's groups in the project area

in Burkina Faso so as reduce their drudgery and increase their productivity.

The women’s centres (CPF) will help to build women’s capacities through targeted training and

information, education and communication activities to be carried out by the United Nations Fund for

Population Activities (UNFPA) in the promotion of reproductive health, including HIV/AIDS

prevention and violence on women. Special emphasis will be laid on the availability and dissemination

of information on cross-border trade to enable female vendors to cross the border more systematically

without being attacked or harassed. To mitigate the effect that increased traffic on the corridor may have

on the spread of HIV/AIDS and other STDs, as well as the increase in road accidents in the area,

sensitization campaigns on environmental protection, road safety, HIV/AIDS and STDs, and compliance

with axle load limitations will be carried out within the framework of the project.

Social Situation and Youth Employment

The youth and women’s employment situation is a great cause for concern. The indicators show that

65.4% of the unemployed in Burkina Faso are below 24 years of age, and more than 30% of Togolese

youths are unemployed. Given the magnitude of the problem, it has been proposed that this project be

implemented as a pilot project of the Joint Initiative of the African Union (AU), the African

Development Bank (ADB), the United Nations Economic Commission for Africa (ECA) and the

International Labour Organization (ILO) so as to promote job creation for youths in Africa.

Project support in this connection is consistent with the national employment promotion strategies,

particularly in the public works and civil engineering sector which absorbs much of the investment

budgets of both countries, and should therefore contribute significantly to the achievement of the

objectives of this Initiative. Project support to this Initiative will be through: (i) the inclusion of

incentives for the use of local manpower in the bidding documents for works; (ii) taking into account

provisions concerning procurement for related works with total allocations of CFAF 4.8 billion, and

contract sizes that will enable local SMEs to participate in competitive bidding; (iii) the provision of

practical training for a total amount of CFAF 1.65 billion so as to increase the employability of youths

and women in road maintenance through "training worksites"; and (iv) the execution of labour-intensive

works totalling CFAF 3.60 billion, such as the development of 5.5 km of pavestone roads on the

Tenkodogo road network and the access road to Anié market. To ensure job sustainability and the

integration of youths who will be trained, the Road Funds will include in their annual road maintenance

programmes contracts to be signed with youth and women's associations for non-mechanized routine

road maintenance works.

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Forced Resettlement

The project works will not require any major expropriation because they mainly concern the

rehabilitation of road sections without significant change of the route, hence there will be no

displacement of people. However, in Togo, 15 installations built with fragile materials for informal trade

at the Blitta junction: sale of clothes, retail of fuel, coffee or handicraft activity (two-wheel containers)

or used as warehouses, will be relocated. Social facilities were also identified: shed used as office for

"zémidjan" (motorcycle taxi) or transporters’ union in Blitta, and a space for prayer. All persons affected

by the project, be they (legal or customary) owners on the project road area will be eligible for

compensation. For each commercial building affected, the owner will be paid compensation in cash the

amount of which will be equivalent to the cost of construction of a new building assessed at market

price without considering depreciation. The resettlement cost totalling about CFAF 8 million will be

entirely borne by the Togolese Government. The full payment of compensation for expropriation by

the Togolese Government is a condition for this project.

4 PROJECT IMPLEMENTATION

4.1 Implementation Arrangements

Executing Agency

This project, which is part of the WAEMU Commission’s Community Road Transport Infrastructure

Action Programme (PACITR), will be implemented under the joint responsibility of Burkina Faso, Togo

and the WAEMU Commission. Given that transport facilitation transcends individual States, Togo and

Burkina Faso have agreed to: (i) delegate the monitoring and management of certain activities of the

transport facilitation component as well as overall project implementation coordination to the WAEMU

Commission; and (ii) transfer regional facilitation infrastructure and equipment to the Community’s

heritage. The WAEMU Commission will rely on the Department of Community Planning, Transport

and Tourism (DCPTT) through the Department of Infrastructure which has sufficient human resources.

In addition, this Department has acquired sufficient experience in the implementation of similar projects.

Submission of the agreement, which delegates project ownership to WAEMU, to the Bank is a

condition for this project.

The executing agency in Burkina Faso is the Ministry of Infrastructure and Road Development (MID)

through the General Directorate of Roads (DGR) which has adequate human resources. The project will

use the Project Implementation Monitoring Unit established in 2009 within the DGR by Order No.

2008/0031/MID/SG/DGR. The Bank has already given its no-objection opinion on the CVs of the Unit's

staff (Coordinator, Accountant, Road Engineer and Works Supervisor). A performance contract will be

signed between the Director General of Roads and the Project Coordinator for the conduct of an annual

performance evaluation. To better monitor the transport facilitation component, a focal point will be

pointed for the Customs department, and another for the Department of Land Transport. The project

provides for equipment and operating resources for the Unit, as well as the payment of monthly bonuses

and allowances to the Unit’s staff and the focal points, in accordance with the legal provisions in force.

In addition, the project also intends to support the DGR through technical assistance comprising two

experts for a two-year period and short-term experts, including a procurement specialist.

15

In Togo, project implementation monitoring will be based on the institutional mechanisms established

under the Aflao/Sanvee-Condji Road Rehabilitation Project financed by the ADB. The Ministry of

Public Works will be the executing agency, through the Project Implementation Monitoring Unit

(PIMU) within the General Directorate of Public Works. This Directorate, which has adequate human

resources, will appoint two engineers as Project Officers, one of whom will be the Project Coordinator.

A performance contract will be signed between the Director General of Public Works and the Project

Coordinator for the conduct of an annual performance evaluation. To ensure better monitoring of the

transport facilitation component, a focal point will be appointed in the Department of Road and Railway

Transport in the Ministry of Transport, and another in the Customs Department. The project provides

for equipment and operating resources for the Unit, as well as the payment of monthly bonuses and

allowances to the Unit’s staff and the focal points, in accordance with the legal provisions in force. In

addition, the project also intends to support the DGTP and DT through technical assistance comprising

two experts for a two-year period and short-term experts, including a procurement specialist.

The project will also use the institutional mechanisms that have already been established (Observatories

of Abnormal Practices, National Road Transport and Transit Facilitation Committees, Regional Road

Transport and Transit Facilitation Committee, and the PACITR Steering Committee). To ensure proper

coordination of project activities, a Joint Technical Committee (CTM) will be established; the

committee will comprise Directors in charge of Roads, Transport and Customs and representatives of

the Ministries of the Economy and Finance (Cooperation/Permanent Secretariat), the Project

Coordinators of both countries or their representatives, as well as those of DCPTT (DAIT and DTTM).

The Committee will be coordinated by the DAIT of WAEMU. The CTM will be responsible for

coordinating project implementation, solving any problems and ensuring smooth project implementation

in the countries. It will meet at least twice a year in the two countries, on a rotational basis. The

operating costs of the CTM will be borne by WAEMU. Establishment of the Joint Technical Committee

(CTM) is a condition for this project.

Procurement Arrangements

4.1.5 All goods, works and services financed by the ADF and the EU-Africa Infrastructure Trust Fund

for this project will be procured in accordance with the Bank’s Rules of Procedure for Procurement of

Goods and Works or, as appropriate, the Bank’s Rules of Procedure for the Use of Consultants (May

2008 edition), using appropriate Bank standard bidding documents. Under this project, the KfW has

agreed to comply with the Bank’s procurement procedures. However, the Bank should favourably

consider the following points raised by the KfW: (i) publication, at the expense of the KfW, of

competitive bidding notices in NFA in Germany, in addition to the publication of competitive bidding

notices in the UNDB; (ii) inclusion of standard commitment statements and KfW's standard advance

contract start-up and successful completion guarantees in the works bidding documents after prior

review by the Bank. Procurements entirely financed with counterpart contributions of the Togolese

and Burkina Faso Governments as well as WAEMU and other donors will be undertaken in

accordance with the procurement procedures of each country, WAEMU and other donors.

http://www.eu-africa-infrastructure-tf.net/

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Special Arrangements

4.1.6 On 7 February 2012, the Governments of Togo and Burkina Faso requested and obtained from the

Bank, approval for advance procurement actions (APA) for: (i) road and related works; (ii) consultancy

services for works control and supervision; (iii) consultancy services for socio-economic impact

monitoring and assessment; (iv) consultancy services for transport facilitation impact monitoring and

assessment, for which the ownership should be delegated to WAEMU Commission by Togo and

Burkina Faso; and (v) technical assistance. Competitive bidding for the activities listed above is

scheduled to be launched in April 2012. The Project Implementation Monitoring Unit (PIMU) of Togo's

Ministry of Public Works and the Project Implementation Monitoring Unit of Burkina Faso's Ministry of

Infrastructure and Road Development will be responsible for the procurement of works, goods and

services. All the procurement documents and decisions will be subject to prior endorsement by the

authorities in charge of public procurement in both countries, in accordance with the Public Procurement

Code. The draft procurement plans prepared by the various PIMUs for procurements under their

competence were submitted to the Bank for review and approval before the negotiations. Details of

procurement methods, review procedures, national laws and regulations, national procurement systems

and evaluation of executing agencies are presented in Technical Annex A.2.

Disbursement and Auditing

4.1.7 The direct disbursement method will be adopted for works, the supply of goods, and consultancy

services, as well as activities whose management has been delegated to WAEMU. The operating costs

of the executing agencies and the Joint Technical Committee will be paid from national counterpart

contributions and by WAEMU. Concerning auditing, annual project financial statements and accounts

will be audited by an independent audit firm and reports related thereto will be forwarded to the Bank in

accordance with the rules and procedures in force. Four audits will be conducted for this project for the

2012-2013, 2014 and 2015 and part of the 2016 fiscal years, as well as three technical audits.

Financial Management

4.1.8 In both countries, the accounting services of executing agencies will be responsible for financial

and accounting management. WAEMU will ensure the financial management of the transport

facilitation component. During the assessment of the financial capacities of the executing agencies, a

fiduciary risk was identified. To mitigate it, an accounting software will be acquired, the accounting and

financial teams trained, procedures manuals prepared, and the staff of each implementation unit

reinforced with an accountant and a bookkeeper.

4.2 Monitoring and Evaluation

Project monitoring and evaluation will include internal and external monitoring, Bank supervision

missions, a mid-term review and a final evaluation, including the completion report of the executing

agencies. Monthly and quarterly reports will be prepared on the execution of works by works control

and supervision firms. The executing agencies will prepare and submit quarterly project implementation

reports to the Bank. The Joint Technical Committee will also prepare and submit reports.

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Project impact monitoring will help to identify and analyze project implementation indicators that

contribute to achievement of the expected outcomes. The General Directorate of Statistics and National

Accounts (DGSCN) of Togo and the National Institute of Statistics and Demography (INSD) of Burkina

Faso will, under the responsibility of Executing Agencies and through a service agreement, assess the

socio-economic impacts of the project in the project direct impact area. A consultant to be recruited by

WAEMU will monitor and evaluate the impacts of transport facilitation on the entire corridor.

4.3 Governance

The challenges to be faced regarding good governance of the transport sector include long delays and

transparency in procurement, establishment of a baseline framework for investment planning,

transparency in the financial management of infrastructure maintenance, and impediments to road

traffic. Burkina Faso and Togo have adopted a new public procurement code which complies with the

regulatory and legal framework as regards international standards, as well as with the provisions of the

WAEMU Directive based on the principle of separation of regulatory and control functions (Public

Procurement Regulatory Authority, General Directorate of Public Procurement and Procurement

Commissions in each Ministry). Thus, the recent evaluation missions carried out by the Bank and the

World Bank underscored the significant progress made in Burkina Faso and, indicted that, overall,

increasing efforts are being made to align the national procurement system and procedures with

international standards. Furthermore, to improve investment planning and programming, Burkina Faso

in 2011 updated its transport sector strategy. In Togo, the Bank is financing the transport sector

development strategy study, whose final reports are expected at the end of 2012.

The Governments of Togo and Burkina Faso are also aware of recurrent problems associated with the

first generation road funds (financial mismanagement, lack of external audits, use of funds for

unauthorized expenditures, embezzlement, and inadequate control). Consequently, they have initiated

road maintenance reforms in accordance with the WAEMU Directive on the establishment of second

generation Road Funds by developing strategies to optimize road maintenance, establishing road

databanks for more transparent road maintenance programming, and setting up autonomous road

maintenance funding bodies. In Togo, the Société Autonome de Financement de l’Entretien Routier

(SAFER) (Autonomous Road Maintenance Finance Corporation) receives resources from road user

charges, enjoys administrative and financial autonomy, has a board of directors comprising members

from the public and private sectors, and is subject to regular financial and technical audits. Burkina Faso

has taken measures to set up a second generation road fund, and has initiated discussions with partners

on the terms and conditions for Burkina Road Maintenance Fund (FER-B) financing and administration

which should be completed in 2013.

The project design also includes specific measures to mitigate governance risk to ensure that resources

are used judiciously and for the purposes for which they are intended. In this regard, the project will

provide technical assistance in procurement to the various executing agencies. Measures will be taken to

minimize road harassment and time wasting along the corridor, and all procurements will be submitted

to the Bank for prior review and approval. In addition, independent auditors will be recruited to carry

out project financial and technical audits.

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To ensure good governance along the main roads in West Africa, ECOWAS and WAEMU set up the

Observatory of Abnormal Practices (OPA) in 2005. The OPA, which now covers five corridors,

including the Lomé-Ouagadougou corridor, helps to periodically record practices that hamper traffic

fluidity and efficiency of transport systems. In recent years, OPA's activities, particularly on the Lomé-

Ouagadougou corridor, have contributed to reducing illegal charges, excessive controls, and control-

induced delays.

4.4 Sustainability

The sustainability of the road sections to be rehabilitated under this project will depend on the following

three main factors: (i) the quality of work done; (ii) operation of the roads; and (iii) the level and quality

of maintenance. To ensure compliance with quality standards during the construction phase, the works

will be supervised and monitored by consulting engineering firms selected from among the most

qualified, and which are familiar with similar projects. Furthermore, the technical solutions adopted took

into account the volume and composition of current and future traffic, as well as the geotechnical

characteristics of materials to be used. Lastly, project supervision by the Bank, as well as technical audit

missions to be carried out by consultants, will help to better monitor the technical execution of works.

Pursuant to WAEMU Rule No. 14 on axle load and gross weight control, the two countries have: (i) set

up agencies to control axle load and gross weight, in particular the Road Safety Authority in Togo and

the National Road Safety Authority (ONASER) in Burkina Faso, and (ii) embarked on a process to

interlink their road networks with axle scales, as well as at heavy loading points (ports, cement factories,

etc.). The initial results are encouraging. Thus, since this mechanism was introduced in early 2011, the

statistics compiled in December 2011 showed that the number of overloaded trucks dropped from 80%

to 26% on average that year. These operations will be intensified to completely eliminate truck

overloading.

Regarding the maintenance of the Community road network, Directive No. 11/2009/CM/UEMOA of 25

September 2009 to harmonize road maintenance strategies in Member States defines conditions for the

establishment of road funds in Union Member States, their management, as well as provision of their

resources. Member States had one year to comply with the Directive. To that end, in Togo, the

Autonomous Road Maintenance Finance Corporation (SAFER) was established in 2011 and

amendments to its constituent instrument were adopted in March 2012 to make it a second generation

road fund. A charge of CFAF 35 per litre of fuel is paid directly into SAFER's account. Its

administrative, supervisory and management organs are being set up. In Burkina Faso, the 2007 decree

to set up the Burkina Road Maintenance Fund (FER-B) was amended in 2011 to initiate transition to a

second generation road fund (though its organs have been set up, for the moment, all resources are

derived from public budgetary allocations). The establishment, by Burkina Faso, of a road

maintenance fund that enjoys full autonomy is a condition for this project.

In 2012, estimated resources amounting to CFAF 18 billion for FER-B and CFAF 9 billion for SAFER

will normally be sufficient to meet routine road network maintenance needs in both countries. Both

Governments have undertaken to supplement these resources through budgetary allocations for periodic

road maintenance needs. The project roads and related rural roads form part of the classified road

network in both countries, and are therefore eligible for financing by the Road Fund. Annual

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maintenance requirements are estimated at CFAF 136 million, or 2% of the Road Fund resources in

Togo, and CFAF 101 million, or 1% of the Road Fund resources in Burkina Faso. Submission of the

road maintenance budget and a report on its use to the Bank by both Governments each year is a

condition for this project.

4.5 Risk Management

The main risks that could hamper achievement of the project outcomes are: (1) the juxtaposed border

checkpoint at Cinkansé is not fully operational; (2) the application of axle-load regulations in both States

is not effective; (3) persistent harassment at checkpoints on the corridor due mainly to lack of a single

security for transit operations; (4) delay in upgrading the existing road funds in both countries to second

generation road funds with sufficient autonomous resources. The first risk will be mitigated by the fact

that WAEMU and both States have undertaken to adopt appropriate measures to make this checkpoint

operational through the newly established ad hoc commissions comprising all stakeholders. Evidence

that the juxtaposed border checkpoint (PJC) is fully operational is a condition of this project. The

second risk will be mitigated by: (a) the fact that axle-load and gross weight control is now carried out

upstream by installing axle scales at all loading points (before exiting Lomé Port, the cement factory,

cargo areas, etc.); (b) installing axle scales across all West African countries; (c) securing shipments by

accelerating containerization and sealing to prevent the modification of shipments during transit; (d) the

management of weighing stations entrusted to autonomous entities with a performance contract; and (e)

monitoring of the application of regulations by commissions in which development partners are

stakeholders. The third risk will be mitigated by the regular sensitization of policy-makers through OPA

reports, the goods tracking and radio-communication system, and the interconnection of customs data

processing systems provided for under the project, as well as the institution of a single security for

transit operations. Amendment, by Togo, of the instrument on the inter-State road transit

operations guarantee fund is a condition for this project. The fourth risk will be mitigated by the fact

that both countries have, in accordance with WAEMU Directives, embarked on the establishment of

second generation road funds.

Risks that may hamper project implementation are: (1) increase in the cost of works in relation to the

estimated budget; (2) long procurement deadlines and delays; and (3) difficulties and/or delays in

mobilizing counterpart contributions. The first risk will be mitigated by the availability of

comprehensive implementation studies updated in 2011, a realistic cost estimate based on similar work

contracts launched between 2010 and 2011, adequate provision for price escalation, Advance

Procurement Actions that will reduce the time between the conduct of studies and the start-up of works,

and measures taken to ensure broad competition during bidding. The second risk will be mitigated by

the fact that the two executing agencies will be supported by technical assistance that will provide a

procurement expert in good time and by the close assistance that will be provided by the Bank’s Offices

in both countries to the agencies. The third risk will be mitigated by the fact that Burkina Faso's

counterpart contribution to the components to be funded by Bank has been reduced considering that the

country is eligible for 100% project financing by the Bank. As regards Togo, the expected total

counterpart contribution for the entire project of about CFAF 7.8 billion, or about CFAF 2 billion

annually, is bearable when compared to the CFAF 2.3 billion spent each year on the maintenance of

road sections of the corridor. To secure counterpart resources, the opening of a counterpart

contribution account and its regular replenishment with resources is a condition for this project.

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4.6 Knowledge Building

The knowledge that would be acquired from project implementation will concern best road project

management and monitoring and evaluation practices within a regional context. The best practices will

be disseminated among project stakeholders through periodic meetings and briefing notes. The

emphasis placed on project impact assessment is mainly intended to meet knowledge building needs.

Indeed, the establishment of the baseline situation before the start-up of project activities will provide a

basis for comparison in order to realistically assess the level of achievement of project impacts. The data

for comparison will be derived from the evaluation of project outcomes upon the completion of works.

The organization of a national workshop will help to disseminate knowledge acquired from the studies.

It will also be necessary to focus on road maintenance through the mechanism that will be established to

ensure investment sustainability.

The key knowledge and lessons learned will be managed from a relational database at the DGTP in

Togo and the DGR in Burkina Faso. This database will effectively facilitate the management of all

knowledge acquired from activities, outcomes, key outputs and lessons learned from this

project. Summaries could be published on the Bank's website.

5 LEGAL FRAMEWORK

5.1 Legal Instrument

The Bank will provide grants and loans to the Governments of Togo and Burkina Faso to help finance

this project.

5.2 Conditions Associated with Bank’s Involvement

A. Commitments

Burkina Faso and the Republic of Togo undertake to take appropriate steps to ensure that financial

resources provided by other donors are made available in a timely manner.

B. Conditions precedent to Effectiveness of the ADF Grants and Loans to Togo and Burkina Faso and

the FSF Grant to Togo

Effectiveness of the ADF and FSF grants shall be subject to signature of the related Protocols of

Agreement by the Governments of Togo and Burkina Faso and the Bank.

Effectiveness of the ADF loans shall be subject to fulfillment, by the Borrowers, of the conditions

specified in Section 12.01 of the General Conditions.

C. Conditions precedent to First Disbursement of the ADF Grants and Loans and the FSF Grant

(i) The Republic of Togo shall submit to the Bank: (a) evidence of opening two accounts for the

counterpart contributions - one of them shall be for the operating resources of the Project

Implementation Monitoring Unit and the other for its contribution to the financing of the works

(paragraphs 2.4.3 and 4.5.2); and (b) evidence of the payment of compensation for

expropriations (paragraph 3.2.13);

21

(ii) Burkina Faso shall submit to the Bank evidence of replenishing the counterpart contribution

account already opened for the operating resources of the Project Implementation Monitoring

Unit (paragraphs 2.4.3 and 4.5.2); and

(iii) Burkina Faso and the Republic of Togo shall submit to the Bank the instrument establishing the

Joint Technical Committee (CTM) and appointing its members (paragraph 4.1.4).

D. Other Conditions for the ADF Grants and Loans and the FSF Grant

(i) Burkina Faso and the Republic of Togo shall: (a) submit to the Bank, no later than 31 December

2012, the signed agreement delegating project ownership to WAEMU for the management of the

goods tracking system and the monitoring and evaluation of transport facilitation impacts

(paragraph 4.1.1), and (b) take appropriate steps to make the Cinkansé Juxtaposed Border

Checkpoint (PCJ) operational no later than 31 December 2012 (paragraph 4.5.1);

(ii) The Republic of Togo shall submit to the Bank, no later than 31 December 2012, the signed

instrument amending the text on the inter-State transit operations guarantee fund (paragraph

4.5.1);

(iii) Burkina Faso and the Republic of Togo shall submit the road maintenance budget and a report

on its utilization each year to the Bank (paragraph 4.4.4);

(iv) Burkina Faso shall: (a) replenish no later than 31 March of each year the counterpart contribution

account for the operating resources of the Project Implementation Monitoring Unit, (b) before

the end of 2013, establish a road maintenance fund that enjoys full autonomy (paragraph 4.4.3);

(v) Burkina Faso and the Republic of Togo shall submit to the Bank no later than 31 January 2013

the financing agreements concluded with the WADB and EBID, and the Republic of Togo shall

submit to the Bank no later than 31 December 2013 the financing agreement concluded with the

IsDB (paragraph 2.4.2).

5.3 Compliance with Bank Policies

This project is consistent with all applicable Bank policies.

6 RECOMMENDATION

Management recommends that the Board of Directors should approve the proposed: (i) UA 30.23

million ADF grant to the Government of Togo and UA 84.60 million ADF grant to the Government of

Burkina Faso; (ii) UA 17.80 million ADF loan to the Government of Togo and UA 21.53 million ADF

loan to the Government of Burkina Faso; and (iii) UA 21.50 million FSF grant to the Government of

Togo, to finance this project in accordance with the conditions specified in this report.

APPENDIX I

I. Comparative Socio-economic Indicators Togo/Burkina Faso - Development Indicators

Social Indicators TOGO BURKINA FASO

Africa Developing

Countries 1990 2011 * 1990 2011 *

Area (000 Km²) 57 274 30 323 80 976

Total Population (million) 3.7 6.2 9.3 17.0 1 044.3 5 732.2

Annual Population Growth (%) 2.5 2.1 2.7 3.0 2.3 1.3

Life Expectancy at Birth – Total (years) 57.7 63.6 47.4 53.7 56.0 67.1

Infant Mortality Rate (per 1000) 100.8 67.1 106.9 77.8 78.6 46.9

Number of Physicians (per 100 000 people) … 5.0 … 6.0 58.3 109.5

Births Attended by Trained Health Personnel (%) … 62.4 … 53.5 50.2 64.1

Child Immunization against Measles (% of children aged 12-23

months) 73.0 84.0 79.0 94.0 77.9 80.7

Primary School Enrolment Ratio (% of Total) 95.8 139.6 30.1 75.6 100.4 107.2

Girls/Boys Primary School Enrolment Ratio (%) 64.4 89.9 63.2 91.0 90.9 100.0

Illiteracy Rate (% of population >15 years) … 56.9 … 28.7 65.1 80.3

Access to Safe Water (% of population) 49.0 60.0 34.0 76.0 64.5 84.3

Access to Health Services (% of population) 13.0 12.0 5.0 11.0 41.0 53.6

Value of HDI (Rank on 179 countries) … 162.0 … 181.0 n.a n.a

Human Poverty Index HPI-1) (% of population) … 36.6 … 51.8 34.7 …

TOGO BURKINA FASO

Macroeconomic Indicators 2000 2009 2009 2010 2010 2011

GNI Per Capita, Atlas method (current USD) 328 527 493 544 551 …

GDP (current USD million) 1 291 3 156 8 327 9 203 3 259 3 710

Real GDP Growth (annual %) -1.2 3.2 3.2 7.2 3.6 3.4

Real GDP Growth Per Capita (annual %) -4.1 1.0 0.2 4.1 1.5 1.3

Gross Domestic Investment (% of GDP) 15.9 18.7 21.1 21.9 20.1 21.1

Inflation (annual %) 1.9 1.9 2.6 -0.7 3.4 4.1

Budgetary Balance (% of GDP) -4.7 -2.8 -4.8 -5.8 -3.3 -2.5

Trade, External Debt and Financial Flows 2000 2009 2000 2009 2010 2011

Variation in Volume of Exports (%) -9.9 16.7 66.9 116.0 -5.3 2.8

Variation in Volume of Imports (%) 9.1 9.2 -10.7 33.9 -3.4 6.9

Variation of Terms of Trade 19.3 -0.1 -20.1 -12.4 -1.1 1.9

Trade Balance (USD million) -136.9 -413.0 -482.0 -129.5 -476.8 -569.2

Trade Balance ( (% of GDP) -10.6 -13.1 -5.8 -1.4 -14.6 -15.3

Current Account Balance (USD million) -112.4 -210.3 -352.6 -299.3 -225.0 -278.0

Current Account Balance (% of GDP) -8.7 -6.7 -4.2 -3.3 -6.9 -7.5

Debt Servicing (% of exports) 2.8 4.6 4.6 … 5.1 2.9

Total External Debt (% of GDP) 9.7 55.4 23.2 23.4 16.8 16.0

Total Net Financial Flows (USD million) 60.3 554.2 1079.7 … … …

Net Official Development Assistance (USD million) 69.6 499.0 1083.9 … … …

Net Direct Investments (USD million) 41.5 50.1 171.4 37.1 41.1 …

International Reserves (months of imports of goods & services) 2.6 3.7 5.1 3.3 3.6 …

Private Sector and Infrastructure Development 2000 2005 2000 2005 2010 2011

Time required to start a business (days) … 65 40 14 84 84

Investor protection index (0-10) … 3.7 3.7 3.7 3.7 3.7

Stationary telephone subscribers (per 1 000 inhabitants) 8.9 11.6 6.4 8.7 35.5 …

Internet users (per 1 000 inhabitants) 10.4 80.2 44.6 346.6 406.9 …

Asphalted roads (000) 31.6 … … … … …

Goods transported by rail (million - km) … … … … … …

Source: ADB Statistics Department Database, from national and international sources.

* Most recent Year. Last updated: October 2011

APPENDIX II

Bank's Ongoing Projects Portfolio in Togo as at 31/3/2012

(Amount in Units of Account)

Project Name Approval Date Closing

Date

Loan/Grant

Amount in

UA

Disbursement

Rate Age

National Projects Portfolio

Integrated Water Supply Information

System 1/12/2009 3/1/2011 1 340 212 35.05 2.08

Aflao-Sanveecondji Road Project 1/13/2010 12/31/2012 25 250 000 20.00 1.08

Economic and Financial Governance

Support 10/5/2010 12/31/2013 4 850 000 9.31 0.35

Economic and Financial Governance

Support 10/5/2010 12/31/2013 4 360 000 0.00 0.35

Humanitarian Aid to Flood Victims 4/2/2009

500

1.86

Lomé Port Container Terminal 15/7/2011 60 000 000

Multinational Projects Portfolio

Project for Rehabilitation of the Lomé-

Cotonou Road and Transport

Facilitation on the Abidjan-Lagos

Corridor Phase

5/10/2011 31/12/2016 4 810 000 0

Bank's Ongoing Projects Portfolio in Burkina Faso as at 31/3/2012

Project Name Approval Date Closing Date Loan/Grant

Amount in UA

Disburse

ment Rate Age

National Projects Portfolio

Accelerated Growth Strategy and Business

Environment Support Programme 20/9/2011 31/12/2012 50 000 000 50.00 0.53

Electrical Infrastructure Strengthening and Rural

Electrification Project 7/7/2010 31/12/2014 25 150 000 1.03 1.73

Community Agricultural Fertility Investment

Project 27/10/2004 30/6/2012 6 400 000 93.80 7.41

Small Dams Development Project 12/12/2002 30/6/2012 10 000 000 67.23 9.28

Gnagna and Kouritenga Rural Development

Support Project 21/7/2006 31/12/2012 12 500 000 73.24 5.68

Project for Support to Institutions Responsible

for Public Resource Management 27/10/2006 31/12/2012 2 460 000 87.74 5.42

Education V Project 16/7/2003 30/12/2012 17 000 000 66.01 8.69

Centre-East and North Regions Health

Development Support Project 27/7/2005 31/3/2013 25 000 000 60.84 6.66

Rural Drinking Water Supply and Sanitation

Project 24/7/2007 30/9/2013 20 000 000 37.36 4.68

Creation of Tsetse-free Zones 8/12/2004 30/6/2013 9 580 000 64.44 7.30

Multinational Projects Portfolio

Air Safety Oversight Capacity Building

Programme (COSCAP) (UA 4.6 million of

which UA 1.30 million for WAEMU)

27/4/2005 30/6/2012 4 600 000 6.91

WAEMU/Ghana-Road Programme 1 (UA 68

million of which UA 3.5 million for WAEMU

and UA 23.62 million for Burkina Faso)

19/11/2003 31/12/2012 68 000 000 71.33 8.35

ECOWAS Peace and Development Support

Project 29/9/2004 31/12/2012 10 000 000 60.08 7.49

Higher Education Support Project/WAEMU 24/7/2006 31/12/2012 20 000 000 23.59 5.67

APPENDIX II

Regional Market Reform Programme 4/12/2006 31/12/2012 4 000 000 39.45 5.31

Burkina Faso/Niger: Dori-Téra Road Project 21/10/2006 31/12/2011 12 700 000 94.3 5.43

Supplementary Loan to Burkina Faso to Finance

the (WAEMU/Ghana) Road Programme 1. 25/11/2008 30/6/2012 18 000 000 85.48 3.34

Burkina Faso Cotton Sector Support Project 29/11/2006 31/12/2013 10 000 000 59.79 5.33

APPENDIX III

MAJOR RELATED PROJECTS FINANCED BY THE BANK AND OTHER

DEVELOPMENT PARTNERS IN BOTH COUNTRIES

III-1 – BURKINA FASO

No. Project Name Source of Financing

Financing Cost (in

CFAF million

Excl. Tax)

Loan Agreement

Signature Date

Loan Agreement

Expiry Date

1 WAEMU/Ghana Road

Programme 1

ADF (Loan and

Grant) 49 636 12/10/2004 31/12/2012

2

WAEMU/Ghana Road

Programme 1 (Supplementary

Loan)

ADF (Loan) 13 139 14/7/2009 30/6/2012

3

Niger/Burkina Faso: Dori-

Téra Road Development

Project

ADF (Loan and

Grant) 11 058 16/11/2006 31/12/2011

4

Tarring of the Diébougou-

Yegueresso Road and Hamélé

Slip Road

ABEDA, KFAED,

IsDB, SFD,

WADB, Burkina

Faso

24 000 30/4/2007 2011

5 Reinforcement of the

Ouagadougou-Sakoinsé Road IDA 60 555 8/7/2008 1/12/2013

6 Tarring of the Koudougou-

Dédougou Road

ABEDA. KFAED.

IsDB, SFD, OPEC,

Burkina Faso

30 000 16/11/2008 2014

7

Rehabilitation of the

Koupéla-Fada-Piega- Niger

Border Road

WAEMU 228

WAEMU own

funds (start of

studies - 20

June 2011 )

WAEMU own

funds (deadline

for conduct of

studies - 12

months)

III- 2 –TOGO

Project Name Source of

Financing

Financing Cost (in

CFAF million

Excl. Tax)

Loan Agreement

Signature Date

Loan Agreement

Expiry Date

Rural Roads Rehabilitation and Bridges

and Water Supply Structures

Construction Project (6 structures)

WADB 4 300 22 May 2006 1 Nov. 2009

extended to 31

July 2011

FAIR-WAEMU 1 074 9 Sept.2006 7 June 2008

Aflao- Sanveecondji Road

Rehabilitation and Modernization

Project (Port Roundabout-Avépozo

section)

ADF 18 510 10 Feb.2010 31 Dec. 2012

Aflao-Sanveecondji Road Rehabilitation

and Modernization Project - Aneho-Fre

Benin section (7.76 km)

WB 13 000 7 April 2010 6 April 2015

Bassar-Kabou Road Development and

Tarring Project (27.5 km)

BIE 6 691 2009 2011

Kabou-Guerrinkouka Road Development

and Tarring Project (35 km)

Kuwait Fund 6 920 24 March 2010 31 Dec. 2015

GuerrinKouka-Katchamba Road Tarring

Project (26 km)

IsDB 5 600 16 April 2010 15 April 2013

Dapaong-Borgou-Mandouri Road

Development and Tarring Project (87

km)

WADB 40 000 24 May 2011 31 Dec. 2014

Development of the Alédjo, Défalé and

Tandjouaré-Cinkassé Slip Roads and the

outer Lomé Slip Road (133 km)

EXIM BANK 84 000 10 Dec. 2010 9 Dec. 2013

WADB 6 500

IsDB 90 500

Dapaong-Ponio-Fre-Burkina Road

Tarring Project (38 km)

IsDB 4 518 25 Jan. 2009 30 July 2011

WADB 8 465 4 Jan. 2013

Togo 632

Total 13 615

Kpalimé - Atakpamé Road

Rehabilitation and Reinforcement Project

(22 km)

BIE TOGO 8 580 2009 2011

PONCIN Project for the construction of

25 modular steel bridges on main earth

roads and rural roads (in 2 phases). 13

bridges for the first and second phases;

12 bridges for which financing should be

sought.

Fortis Bank 2 247.00 18 Aug. 2006

EBID 4 500.00 22 Jan. 2011 21 May 2011

Togo 1 500.00

Total 8 247.00

Technical and economic study of

Community Road CU 19: Nyamassila-

Bagou-Goubi-Bila-Kambolé Balanka-

Benin-Fre Benin + the Balanka-

Kouloumi and Koussountou-Goubi slip

roads (180 km)

ADB 365 10 Feb. 2010 31 Dec. 2012

Technical and economic study and

environmental and social impact

assessment of Community Road CU 18:

Ghana Border-Natchamba-Kéméridè-

Kara- Kéméridè-Benin Border (115 km)

FAIR-WAEMU 178 9 Oct. 2009 31 Dec. 2012

Technical and economic study and

environmental and social impact

assessment of the Akatsi - Dzodze-

Noepé Road: Ghana-Togo Bilateral

Project (1.65 km)

EU 25.00

EBID 708.00 10 March 2004 8 Jan. 2007

extended to 31

Dec. 2012

1

APPENDIX IV

Togo - Burkina Faso - Road Rehabilitation and Transport ......AND TRANSPORT FACILITATION ON THE LOME – CINKANSE- OUAGADOUGOU CU9 CORRIDOR COUNTRY: TOGO/ BURKINA FASO PROJECT APPRAISAL

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