ASIAN DEVELOPMENT BANK

PPA:LAO 23210

PROJECT PERFORMANCE AUDIT REPORT

ON THE

FOURTH AND FIFTH ROAD IMPROVEMENT PROJECTS (LOAN 1009-LAO[SF] AND LOAN 1108-LAO[SF]) IN THE

LAO PEOPLES DEMOCRATIC REPUBLIC

December 2001

CURRENCY EQUIVALENTS Currency Unit Kip (KN) At Appraisal October 1989 September 1991 1009-LAO(SF) 1108-LAO(SF) $0.00141 $0.0014 KN709 KN700 At Completion March 1998 $0.0004 KN2,384 At Evaluation October 2001 $0.0001 KN9,520

KN1.00 $1.00

ABBREVIATIONS ADB ADB4 ADB5 DCTPC EA EIRR ICB km Lao PDR m MCTPC N13 OEM PCR PPAR RIA SDR SF TA VOC Asian Development Bank Fourth Road Improvement Project Fifth Road Improvement Project provincial branch of MCTPC Executing Agency economic internal rate of return international competitive bidding kilometer Lao Peoples Democratic Republic meter Ministry of Communications, Transport, Post and Construction national road 13 Operations Evaluation Mission project completion report project performance audit report road influence area special drawing rights Special Funds technical assistance vehicle operating cost

NOTES (i) (ii) The fiscal year (FY) of the Government ends on 30 September. In this report, $ refers to US dollars.

Operations Evaluation Department, PE- 583

CONTENTS BASIC DATA EXECUTIVE SUMMARY MAP I. BACKGROUND A. Rationale B. Formulation C. Purpose and Outputs D. Cost, Financing, and Executing Arrangements E. Completion and Self-Evaluation F. Operations Evaluation PLANNING AND IMPLEMENTATION PERFORMANCE A. Formulation and Design B. Achievement of Outputs C. Cost and Scheduling D. Procurement and Construction E. Organization and Management ACHIEVEMENT OF PROJECT PURPOSE A. Operational Performance B. Performance of the Operating Entity C. Economic Reevaluation D. Sustainability ACHIEVEMENT OF OTHER DEVELOPMENT IMPACTS A. Socioeconomic Impacts B. Environmental Impact C. Impact on Institutions and Policy OVERALL ASSESSMENT A. Relevance B. Efficacy C. Efficiency D. Sustainability E. Institutional Development and Other Impacts F. Overall Project Rating G. Assessment of ADB and Borrower Performance ISSUES, LESSONS, AND FOLLOW-UP ACTIONS A. Key Issues for the Future B. Lessons Identified C. Follow-Up Actions 6 6 6 7 7 8 8 10 10 10 11 11 12 13 13 14 16 16 17 17 18 19 20 20 20 20 20 20 21 21 22 22 22 23 24 Page 4 5

II.

III.

IV.

V.

VI.

APPENDIXES

BASIC DATA Fourth Road Improvement Project (Loan 1009-LAO[SF]) Fifth Road Improvement Project (Loan 1108-LAO[SF])
PROJECT PREPARATION/INSTITUTION BUILDING TA No. TA Project Name 1019-LAO 1255-LAO Northern Roads Improvement 1 Bridge Management Project Type PPTA ADTA PersonMonths n.a. 12 Amount ($) 350,000 300,000 Approval Date 19 Jul 1988 21 Dec 1989

KEY PROJECT DATA ($ million) 1009-LAO(SF) As per ADB Loan Documents Actual ($ million) ($ million) 42.8 48.6 39.0 44.7 39.0 44.7 0.0 1009-LAO(SF) Expected Actual 21 Jun-7 Jul 1989 23 Aug- 7 Sep 1989 26 Oct 1989 21 Dec 1989 16 Feb 1990 16 May 1990 16 May 1990 11 Jun 1990 Dec 1994 Jun 1996 31 Dec 1995 4 Jul 1997 61 79 1009-LAO(SF) Appraisal PCR 11.7 13.3 1108-LAO(SF) As per ADB Loan Documents Actual ($ million) ($ million) 37.7 37.1 34.0 36.0 34.0 36.0 0.0 1108-LAO(SF) Expected Actual 13-27 Feb 1991 9-19 Aug 1991 26 Sep 1991 29 Oct 1991 13 Dec 1991 13 Mar 1992 12 Mar 1992 25 Sep 1992 Dec 1995 Jun 1997 30 Jun 1996 14 Jan 1998 51 69 1108-LAO(SF) Appraisal PCR 12.0 12.0

Total Project Cost Foreign Currency Cost2 ADB Loan Amount/Utilization ADB Loan Amount/Cancellation KEY DATES Fact-Finding Appraisal Loan Negotiations Board Approval Loan Agreement Loan Effectiveness First Disbursement Project Completion Loan Closing Months (effectiveness to completion)

KEY PERFORMANCE INDICATORS (%) Economic Internal Rate of Return BORROWER EXECUTING AGENCY MISSION DATA Type of Mission Fact-Finding Appraisal Project Administration Review Special Project Administration Project Completion Operations Evaluation3 1009-LAO(SF) No. of PersonMissions Days 1 17 1 16 3 2 30 10 1108-LAO(SF) No. of PersonMissions Days 1 15 1 11 1 5 Both Loans No. of PersonMissions Days PPAR 17.9 PPAR 15.6

The Lao Peoples Democratic Republic Ministry of Communications, Transport, Post and Construction

9 1 1 1

101 8 11 20

ADTA = advisory technical assistance; n.a. = not available; PCR = project completion report; PPAR = project performance audit report; PPTA = project preparatory technical assistance; SF = Special Funds; TA = technical assistance.

1 2 3

Accompanying TA of Loan 1009-LAO(SF). The foreign currency cost was covered by the ADB loan, because the value of the special drawing rights, the currency of loan commitment, strengthened against the US dollar during the loan implementation period. The mission comprised C. D. Heider, Senior Evaluation Specialist; and R. Valkovic, Staff Consultant.

EXECUTIVE SUMMARY The Asian Development Bank approved two loans in 1989 and 1991, respectively, to finance the improvement of sections of the main trunk road from Vang Vieng, north of Vientiane, to Pak Mong via Louang Phrabang. The projects aimed to provide all-weather access to the northern provinces, reduce transport costs and facilitate more efficient movement of goods and passengers, and support rural development by enhancing the mobility of rural communities. The loans were to fund improving 346 kilometers of a 6-meter wide carriageway and replacing 41 bridges. In addition, funds were provided for maintenance of existing roads. The estimated cost at appraisal was $42.8 million and $37.7 million, respectively. The two projects were implemented between 1990 and 1997, and completed with a delay of 18 months each. The actual cost amounted to $48.6 million and $37.1 million. The cost overrun under the first project was due to landslides that impeded progress in road construction and required additional earthworks, and an additional bridge that was necessary after Louang Phrabang was declared a world heritage site. The cost overrun was covered by the appreciation of the US dollar against the special drawing rights and by reallocating some maintenance works to later projects. The projects were generally implemented as planned, delivering the main output, namely, the improved carriageway. The construction appears to be of relatively good quality, with road width being consistent and pavement layers (where visible) uniform and wellcompacted. The sealed surface appears well-bonded and generally shows high-quality workmanship, although resealing in some areas may be required in the near future. The majority of the road is smooth, although several sections are affected by landslides and road slips and by major potholes. Allocations made for road maintenance were adequate to purchase equipment and materials required to maintain the agreed-upon number of kilometers. However, the Operations Evaluation Mission could not verify whether these maintenance works were undertaken on the agreed-upon road sections, or whether materials had been used to improve other roads. The projects improved the vital road link from Vientiane to the northern provinces. The road is the backbone of the countrys network and its improvement was essential for other investments in the transport sector and the economy as a whole. This is shown not only in the traffic counts, which grew by 150-230 percent for passengers and around 50 percent for goods between completion and postevaluation. In addition, travel times have been reduced from sometimes 2-3 days to 5-8 hours. Most importantly, the improvements made the road passable in all weather and reduced, if not eliminated, bandit activities that limited the use of the route. This has had beneficial impacts on the socioeconomic activities in the region. While at appraisal only few cash crops were grown, now every one of the visited sample villages reported growing cash crops and selling them to traders or markets at district towns, in Louang Phrabang, or Vientiane. The economic rates of return of the projects have been reestimated at 17.9 and 15.6 percent, respectively, well above the 12 percent calculated at appraisal and completion. The projects are rated highly successful. The technical assistance associated with one project was partly successful. It did not institute the bridge management system it was meant to develop and no traces can be found of the results that the consultants had reported at the end of their assignment.

I. A. Rationale

BACKGROUND

1. The Fourth Road Improvement Project4 (ADB4) and the Fifth Road Improvement 5 Project (ADB5) fitted into a larger development strategy for the road sector financed by a number of multilateral and bilateral funding agencies6 and supported investments in the road influence area (RIA). The projects financed the improvement of the northern part of national road 13 (N13), which is the backbone of the countrys road network, linking the northern and southern provinces of the Lao Peoples Democratic Republic (Lao PDR). The road sections assisted by the Projects are north of Vientiane and run from Vang Vieng to Louang Phrabang (ADB4) and from Louang Phrabang to Pak Mong (ADB5).7 The rationale for choosing these road sections for assistance was based on the Governments concern over the isolation of the northern parts of the country that were cut off from the rest of the country. In addition, the Asian Development Bank (ADB) concluded positively on a number of criteria to justify the projects, including the economic development potential of and other investments in the area, the poor condition of the existing road, and the need for developing the national road network. The rationale for maintenance work (included in the projects) on roads extending from Pak Mong into adjacent provinces was based on technical needs to preserve past investments in the, at the time, only paved roads in the northern areas. B. Formulation

2. The projects were formulated based on an ADB-financed feasibility study.8 Completed in 1989, the feasibility study described existing conditions and road inventory to a sufficient degree. The level of traffic counts and origin-destination surveys were suitable for the low volume of vehicles. Prediction of future traffic was acceptable, given the unknown factors due to ongoing security problems and expected significant changes for traffic growth. The preliminary design following the existing alignment was in line with the Governments economic constraints at the time and traffic volumes in the design period. The design width was based on a detailed cost comparison of different widths for different sections, as mountainous sections were very cost sensitive to this criterion. A lower standard was proposed for the Louang Phrabang-Pak Mong section than for Vang Vieng-Louang Phrabang due to lower traffic volumes. The proposed bridge works were highly detailed and recommended solutions that would improve local construction practices. Drainage problems and deficiencies were addressed, but inadequate attention was paid to the potential slope instability problems, particularly through the mountainous sections. While the feasibility study covered the whole length of the road between Vang Vieng and Pak Mong, it was decided to process two separate loans in view of the total costs and implications on the absorptive capacity and debt burden of the borrower. The loans were appraised in August 1989 and August 1991, respectively. The time required from factfinding to approval was six and eight months, respectively.

4 5 6 7 8`

Loan 1009-LAO(SF) for $39.0 million, approved on 21 December 1989. Loan 1108-LAO(SF) for $34.0 million, approved on 29 October 1991. An overview of investments is given in ADB. 2001. Transport Sector Development: A Medium Term Strategy for the Lao Peoples Democratic Republic. Manila. The N13 section from Vientiane to Vang Vieng was financed by ADB under Loan 866-LAO(SF): Third Road Improvement Project, for $19.0 million, approved on 24 November 1987. TA 1019-LAO: Northern Roads Improvement, for $350,000, approved on 19 July 1988.

C.

Purpose and Outputs

3. The projects aimed to (i) provide all-weather access to the northern provinces from Vientiane; (ii) reduce transport costs in the Project influence area and facilitate more efficient movement of goods and passengers; (iii) support rural development by enhancing the mobility of rural communities; (iv) strengthen domestic capabilities for designing, constructing, and maintaining the countrys road network; and (v) enhance the Governments road maintenance capacity in the northern provinces.9 10 4. The planned outputs of the projects were (i) 346 kilometers (km) of a 6-meter (m)-wide carriageway (230 km under ADB4 and 116 km under ADB5), with double bituminous surface treatment and a shoulder on each side with a single bituminous surface and 1 m wide for the Vieng VangLouang Phrabang section and 0.5 m wide for the Louang Phrabang-Pak Mong section; 41 bridges to replace existing temporary bridges (total length of 1,175 m), 6 m wide between curbs and with railing, made of either reinforced or prestressed concrete deck girder type, depending on span length; rehabilitation of the ferry at Nam Ou River north of Louang Phrabang; a new bridge across the Nam Khan River at Louang Phrabang, 7 m wide between curbs and with a 1.5 m sidewalk on each side; repair of 1,520 km (550 km under ADB4 and 970 km under ADB5) of existing roads in northern provinces by resealing the bitumen surface, reshaping shoulders, removing materials, preventing landslides, regraveling, and/or repairing bridges as required. ADB5 also financed the maintenance of 140 km of local roads and 700 km of national and provincial roads in southern provinces; and enhanced technical capacity of the Executing Agency (EA) in road maintenance and bridge management, through the provision of maintenance equipment and staff training.

(ii)

(iii) (iv) (v)

(vi)

D.

Cost, Financing, and Executing Arrangements

5. At appraisal, the cost of ADB4 was estimated at $42.8 million. The ADB loan amounted to $39.0 million (91 percent of the total cost), with the remainder to be financed by the Government. For ADB5, the cost was estimated at $37.7 million, with the entire foreign exchange component of $34.0 million to be financed by ADB (90 percent of total cost). The actual cost of the projects was $48.6 million and $37.1 million, with actual loan amounts of $44.7 million and $36.0 million, respectively (Appendix 1). The cost overrun under ADB4 was covered by the ADB loan because the special drawing rights (SDR) appreciated against the US dollar during the implementation period.
9

LAO 22078: Appraisal of the Fourth Road Improvement Project in the Lao Peoples Democratic Republic, November 1989. The same objective was stated in the appraisal report of the Fifth Road Improvement Project. 10 Maintenance equipment, spare parts, and tools were also provided under ADB5 to the southern provinces of Champassak and Saravane.

6. The Ministry of Communications, Transport, Post and Construction (MCTPC) was the EA for the projects. The project management unit under MCTPCs project management office reported to the Vice Minister Communication Section. It managed the physical implementation of the projects, assisted by loan-financed consultants. MCTPC had executed the three previous loans to the sector (amounting to $39 million) and has been the EA for four additional loans worth $145 million since the approval of ADB4 and ADB5. In addition, MCTPC has received a total of $13.2 million in TA grants. Appendix 2 lists ADBs loans and TA in the Lao PDRs road sector. E. Completion and Self-Evaluation

7. Implementation of ADB4 was completed in June 1996 and that of ADB5 in June 1997. One project completion report (PCR) was prepared for both ADB4 and ADB5 by the Infrastructure, Energy and Financial Sectors Department (West) and circulated to the Board in December 1998. It concluded that the projects had been implemented as planned, with only minor changes in scope. The completion of each project was delayed by 18 months due to delays in completing detailed engineering and subsequent delays in starting construction work, landslides requiring additional works, Government procedures for procurement and contracting, and long negotiations on commercial unit rates after switching from force account to direct contract (affecting the Vang Vieng-Kasi section of ADB4).11 The PCR also concluded that the projects achieved an economic internal rate of return (EIRR) of 13.3 and 12.0 percent, respectively, slightly higher than the appraisal estimates; improved road maintenance capacities; and had no adverse social or environmental impacts. The PCR rated the projects generally successful. 8. The PCR recommended that (i) the Government set up an effective monitoring and maintenance system for landslides or road slips (necessary, given the mountainous terrain); (ii) sufficient funds be allocated for road maintenance and the condition of the road be monitored/maintained; (iii) future road improvement designs pay particular attention to the risk of landslides and incorporate the information in road designs and construction plans; and (iv) the Government streamline its procurement procedures to ensure timely implementation of projects. 9. The PCR reflected adequately the implementation and results of the projects, although its assessment of the impact and sustainability of the institution building TA (para. 0) was too optimistic. Also, the PCR underestimated maintenance costs, which resulted in overstating the EIRRs. On the other hand, the benefits from time savings were not taken into account in the economic analysis either. F. Operations Evaluation

10. This project performance audit report (PPAR) assesses the projects relevance, efficacy, efficiency, sustainability, and institutional and other development impacts. The PPAR represents the findings of the Operations Evaluation Mission (OEM) that visited the projects in October 2001. This PPAR is based on discussions with officials working for the EA and other

11

The state-owned construction unit was corporatized during the project implementation period. Therefore, a change in procurement method was necessary and resulted in the need to renegotiate rates.

relevant offices, people living in seven villages situated along N13,12 ADB staff, staff of other multilateral and bilateral agencies involved in the transport sector, analysis of documentation, and visits to sites. The OEM inspected the entire road length of ADB4 and ADB5, and visited the Louang Phrabang Road Maintenance Enterprise in Pak Mong. Findings were discussed at meetings in Vientiane and in Manila, and the report was circulated for comments, which were considered in preparing the PPAR.

12

Due to time constraints, the OEM was not able to visit villages located within the RIA that were not along the road, as reaching those settlements would have taken several hours or even days.

II. A.

PLANNING AND IMPLEMENTATION PERFORMANCE

Formulation and Design

11. The projects fitted into a larger development plan for the transport sector that has been supported by a number of multilateral and bilateral funding agencies, with ADB as the largest financier. They focused on an important section of the main trunk road that links the northern part of the country to Vientiane and southern provinces, thus establishing the backbone from which the road network could develop and has been developed further. This main trunk road forms an important link to neighboring countries, namely, Thailand and the Peoples Republic of China, and facilitates trade with them. 12. The appraisal reports of the projects used the findings of the feasibility study (para. 0), which was satisfactory. One weakness of the appraisal reports was that institutional development goals were not well-specified and a full capacity-building plan was not set up.13 The change in the appraisal report for ADB5 from the road maintenance component in ADB4which listed specific roads that should be maintained from loan fundsto a general support to the Governments maintenance program seems reasonable, as it provided greater flexibility. However, there were no safeguards to ensure that allocations from the loan were made in addition to the Governments budget for maintenance. 13. The detailed technical design largely complied with the recommendations of the feasibility report, with the alignment following the existing road, making improvements on substandard radius curves and avoiding major realignments. For all these reasons, the projects were relevant to the development strategies of the Government and of ADB at appraisal and today. B. Achievement of Outputs

14. The main output, i.e., the 6 m wide carriageway of about 340 km, was upgraded as planned. However, due to cost constraints, the shoulder width was reduced in the mountainous regions, i.e., for 63 km between Vang Vieng and Kasi, 23 km between Kasi and Louang Phrabang, and 5 km between Louang Phrabang and Pak Mong. One major realignment involved the rerouting of the road through Louang Phrabang, including 6 km of bypass roads, and construction of a new bridge with steel superstructure across the Nam Khan to the east of the existing bridge, which also resulted in deleting 4 km of town roads and 3 km of village streets from ADB5. The bridge became necessary after Louang Phrabang had been declared a world heritage site. Instead of the other 41 bridges foreseen at appraisal, 24 new bridges were built and 3 rehabilitated. For technical and economic reasons, the rest were replaced with large box culverts. The rehabilitation of the ferry was superseded because a new bridge built across the Nam Ou made the ferry redundant. 15. The projects provided equipment and materials for road maintenance, which contributed to building the EAs capacities in this area. However, the OEM could not ascertain whether the materials were used for maintaining the selected roads or for other roads and therefore cannot

13

The Special Evaluation Study of Effectiveness and Impact of Bank Assistance to the Reform of Public Expenditure Management in Bhutan, India, Kiribati, And Lao Peoples Democratic Republic (SST:REG 99024) discusses capacitybuilding issues that are applicable to the design of the institutional development component of these projects.

determine the exact length of roads maintained with loan funds. The results concerning maintenance capacities are discussed in para. 0. C. Cost and Scheduling

16. Both ADB4 and ADB5 were completed 18 months behind schedule. The delay in implementation of ADB4 was due to (i) delay in completion of detailed engineering; (ii) massive landslides on the project road; (iii) tedious Government procedures for bid approvals; and (iv) change in procurement method to direct contract let to a corporatized state-owned construction unit. Meanwhile, the delay in ADB5 was mainly attributable to (i) difficulty in recruiting labor in the remote project area; and (ii) additional work resulting from the construction of the bridge over the Nam Khan River. The delays in completing the projects did not have a negative impact on the EIRRs. 17. The 14 percent cost overrun under ADB4 (para. 0 and Appendix 1) was mainly caused by additional earth works and repairs to completed sections of the road due to landslides, and building the new bridge in Louang Phrabang. The additional cost was covered by the ADB loan, as the SDR had appreciated against the US dollar, and by assigning some of the maintenance work to a later project.14 There was a 2 percent cost underrun in ADB5.15 D. Procurement and Construction

18. Two contract packages for civil works were procured using international competitive bidding (ICB) procedures. The third contract was undertaken by force account and later converted to a commercial contract through direct negotiation with the corporatized state-owned construction unit that had done the work under force account. The corporatization process was undertaken with ADB assistance.16 19. The Vang Vieng-Kasi section of ADB4 was constructed under force account and later under the direct contract with the state-owned construction company. The force account system suffered from problems in management and procurement of material and spare parts, which delayed progress of works. The system was also inflexible. It took long to procure spare parts whenever equipment broke down. The long time taken for converting to the commercial contract also impeded overall progress. 20. Construction works for the Kasi-Louang Phrabang and Louang Phrabang-Pak Mong sections were contracted following ICB procedures. The procedures took longer than expected as these were the first ICB contracts. One of the contractors experienced some difficultiesADB4 being its first contract in the Lao PDRwhich were compounded by the difficult terrain along the mountainous route of N13 that resulted in a larger-than-expected number of landslides during construction. These difficulties were overcome, even though completion of the construction works was delayed. The work of the contractors was assessed as satisfactory.

14 15

Loan 1369-LAO(SF): Champassak Road Improvement Project, for $48.0 million, approved on 31 August 1995. The local currency component was significantly below the appraisal estimate while a 6 percent overrun in foreign exchange costs was met by the appreciation of the ADB loan. 16 TA 1897-LAO: Privatization and Management of Road Sector Institutions, for $950,000, approved on 1 June 1993.

E.

Organization and Management

21. The EA was fully committed to the projects. The director general of the Department of Roads in MCTPC was an effective counterpart for ADB assistance, fully cognizant of all sector issues, including external assistance and details of ADB4 and ADB5, making decisions as required.17 The EA was supported by a number of TAs that started before and continued after the projects (para. 6 and Appendix 2); the TA associated with ADB5 is discussed in para. 0. The EAs compliance with ADBs loan covenants has been satisfactory. 22. Loan-financed consultants guided EA staff in preparing and implementing the projects, and satisfactorily performed their function. This assistance resulted in building the capacities of EA staff for reviewing contract documents, evaluating bids, monitoring contract implementation, and project management. The EA continues to be supported by a number of international consultants, but it aims to reduce dependence on them. 23. ADB conducted 16 review and special administration missions for a total of 154 persondays (on average 10 person-days per mission). These missions normally served to review other loans that were implemented simultaneously by the same EA or were under processing. This appears to have been an effective use of ADB staff time and resources. Site visits were conducted and problems were dealt with as they arose. Some shortcomings in financial monitoring were noted only in 1996 (about six years after ADB4 started), which possibly could have been identified earlier. Immediate action was taken to rectify the situation by introducing a financial monitoring system that keeps track of construction and maintenance expenditure (para. 0).

17

The Project Monitoring Division set up in 1999 is equally well organized and familiar with all details of the sector and its development, consolidating progress reports prepared by managers of all ongoing projects.

III. A.

ACHIEVEMENT OF PROJECT PURPOSE

Operational Performance 1. Traffic Carried

24. Traffic counts conducted for the evaluation show an average increase of 150-230 percent in passengers and 50 percent in goods for the different road sections since completion. Clearly, external factors influence traffic volumes and it may be several years before clear growth patterns are evident. Growth along the Kasi-Xiang Ngeun section of ADB4 is heavily constrained by the mountainous terrain, restricting the use of heavy vehicles. In the long term, there is limited scope to significantly increase the road capacity while following the existing alignment. The Louang Phrabang-Pak Mong section saw a significant traffic volume increase between appraisal and completion, which likely represented the latent demand before upgrading; the high growth rate since completion may not continue into the future. In the economic reevaluation, an annual traffic growth rate of 6 percent has been assumed, except for the Louang Phrabang-Pak Mong section where traffic is forecast to grow at 14 percent annually for the next five years and at 6 percent thereafter. These are conservative assumptions compared with the observed trends (para. 0 and Appendix 3). 25. The travel time from Vang Vieng to Louang Phrabang at appraisal was 2-3 days by a 4wheel-drive or larger vehicle. This duration was longer during the wet season due to the poor surface condition and slope instability. After project completion, the duration was reduced to 5-6 hours for all smaller passenger vehicles, and 7-8 hours for buses and heavy vehicles, depending on the size of loads. Even when there are larger landslides during the wet season, these are now typically removed within half a day. At appraisal, much of ADB5 (Louang Phrabang-Pak Mong) was literally a track accessible only to larger vehicles, with even 4-wheeldrive vehicles having problems at times. Despite the relatively short length and easier terrain of ADB5, this trip would take two days and longer in the wet season. After completion, the journey time was reduced to two hours for all passenger vehicles and about three hours for trucks. 26. Based on a recent MCTPC study,18 the overload per axle of heavy vehicles along ADB4 and ADB5 is some of the worst in the country. In fact, the difficult terrain of ADB4 contributes to this factor by greatly reducing the ability to use multiaxle trucks to transport goods and effectively allowing only two- or three-axle trucks. Hence, vehicle operators maximize their loads, but have fewer axles to distribute the load, and so road damage factors are much higher.19 This increases maintenance costs and reduces the economic life of the road. Portable weigh scales have been procured and four weigh stations will be built under a more recent ADB project,20 one of which will be located in Phoukhoun on ADB4. In addition, a World Bankfinanced project (footnote 19 and para. 0) will install three-axle load weigh stations along ADB4 and ADB5.

18 19

Final Report. Heavy Transport Management Program, 2000. The generally accepted formula for load to pavement damage is exponential to the power of 4.5. 20 Loan 1533-LAO(SF): Xieng Khouang Road Improvement Project, for $46 million, approved on 9 September 1997.

2.

Technical Standards and Current Conditions

27. The road construction appears to be of a relatively good quality, with road width being consistent and pavement layers (where visible) uniform and well-compacted. The sealed surface appears well-bonded and generally of high quality workmanship, although it is showing signs of its age in some areas and needs to be resealed in the next few years to avoid excessive deterioration. The worst section, 24 km near Phoukhoun, has already been resealed. The international roughness indicator for the road surface is estimated to vary between 3.5 and 6, with most of the road being in the lower end of the range (i.e., less rough). The worse sections are in the mountains around Phoukhoun and between Louang Phrabang and Pak Mong. 3. Maintenance Program

28. At appraisal, the responsibility for maintenance lay with the maintenance units of the EA. Since 1995, these units have been commercialized and continue to exist as state-owned, but commercially operated entities that have to compete with private enterprises. The responsibility for contracting and supervising routine and periodic maintenance has been delegated to the provincial branches of the EA (DCTPCs), while the EA retains a planning, monitoring, and management function vested in the Road Administration Division. Local contractors undertake much of the periodic maintenance (resealing) and emergency maintenance (removal of landslides and repairs or road slips), while local contractors and local communities do routine maintenance. Retired DCTPC staff organize to resolve emergency situations (such as fallen rocks) and villagers are hired to clear vegetation and other blockages from the drains within 12 km of their village. The OEM observed that emergency and periodic maintenance was implemented satisfactorily. The level of routine maintenance varied considerably with some drains heavily overgrown while others were well maintained. Routine maintenance (removal of vegetation) is essential for road safetyit ensures good visibility and prevents other damages to the road due to blocked drainage. The response to emergency situations seemed satisfactory. DCTPCs reported that managing and supervising arrangements for routine maintenance through communities were time-consuming and ineffective, and hiring local contractors was preferred. B. Performance of the Operating Entity 1. Sector Management

29. In the area of road construction, the EA is competent to critically review contracts, assess whether design standards are met, analyze costing submitted by contractors and consultants, and request desirable modifications. Technical design capacities (drawings) are limited as a matter of policy because these services are considered better contracted out. However, capacities should be developed to enable the EA to review and assess technical designs rather than rely on consultants submitting the design drawings. 30. For supervision of contracts awarded through ICB, the EA recruits consultants. Local capacities for supervision are improving and continue to be built as domestic consulting firms participate in projects as inspectors, assistant engineers, and assistant resident engineers. With sufficient time, local capacities will develop. The role of the EA in this area is to monitor progress reported by supervision consultants, and to monitor the supervision consultants. This is a typical practice in the industry, particularly in developing countries.

31. Local capacities for actually carrying out construction work have been improving over the past years. At the time of the feasibility study and in the early phase of implementing the projects, construction was carried out under force account. Subsequently, the state-owned construction companies were commercialized. In addition, some private construction companies have evolved. These are now capable to take on contracts for construction, and emergency and periodic maintenance. In their function as subcontractors they are sometimes responsible for all works for a short section of road construction. The companies tend to be medium size and can compete only for relatively smaller contracts but sometimes they form joint ventures with foreign companies to work on larger contracts. However, the number of contracts available locally is limited, thus restricting the extent to which local contracting industries can develop. The DCTPCs monitor the implementation of maintenance contracts, but face limitations in number of personnel, vehicles, and possibly skills to effectively exercise the quality control function. 2. Financial Management

32. The appraisal report for ADB4 estimated that revenues from the road sector amounted to $10 million, which would have been sufficient to cover the estimated requirements for maintenance of $7 million. Allocations for maintenance have, however, fallen short because resources are largely allocated to the requisite counterpart funds for investments in construction and rehabilitation. Road sector revenues are derived from sales and import duties and various licenses and fees.21 The World Bank estimated that in FY1997/98, revenue generated from the vehicle fleet, including tax on fuel consumption, amounted to 9 percent of total internal revenues, or KN29 billion, of which only KN11 billion was allocated to the road sector. Of the KN7 billion allocated for road maintenance, KN3 billion was financed from the internal revenues and met just 7 percent of the maintenance needs for national and local roads. Funds from internationally-assisted projects financed the rest of the road maintenance allocation. 33. To redress this situation, a road maintenance fund will be established with the assistance of the World Bank and others, including ADB. The aim is to preserve road assets by increasing the allocations for road maintenance, controlling through proper maintenance the extent to which road roughness indicators increase, and reducing the number of heavy vehicles that are overloaded. This World Bank project22 will be implemented in two phases starting in October 2001, with expected completion in December 2009. At that time, it is expected that internal revenues will meet 90 percent of the road maintenance requirements. Such revenues will be generated through fuel levy and heavy vehicle surcharge, raised in addition to current road sector revenues from import duties, excise and turnover taxes on vehicles and fuels. The maintenance of the projects road will be covered by the road maintenance fund. 34. To ensure that expenditure for construction and maintenance contracts is monitored, the EA has in place a system of checks and balances and monthly reporting. This system was, in part, developed with the assistance of ADB after reported shortcomings were noticed (para. 0). The system generates regular reports on implementation status, but the extent to which it is effective in controlling expenditure and managing cash flow is not clear. At present, the Swedish International Development Agency is assisting in developing a consolidated accounting system that will cover all expenditures related to road construction and maintenance. The accounting system will have to be linked to the contract monitoring system to ensure consistent use of expenditure data and minimize the workload in updating and reentering data.

21

ADB. 2001. Transport Sector Development: A Medium-Term Strategy for the Lao Peoples Democratic Republic. Manila. 22 World Bank. 2001. Road Maintenance Project, Project Appraisal Document 21773-LA. Washington, D.C.

C.

Economic Reevaluation

35. The EIRR was reestimated, following a methodology similar to that used at appraisal and completion. However, there were several differences. A conversion factor of 0.92 was applied to the construction cost of the projects to arrive at the economic cost. Higher maintenance costs were used, based on actual expenditures during the first years of operation and on projections of the EA. The PCR significantly underestimated these costs. Benefits were reestimated by updating traffic count figures and adjusting vehicle operating costs to constant 2001 prices. Finally, benefits derived from time savings were included, which had not been considered at appraisal or completion. The reestimated EIRRs for ADB4 and ADB5 are 17.9 and 15.6 percent, respectively, well above the estimates at appraisal and completion, which were around 12 percent. Appendix 3 provides details of the EIRR calculation. D. Sustainability

36. The projects are sustainable in that N13 is the vital link to the northern provinces and the backbone of the transportation network in that part of the country. The Government is therefore committed to sustaining the investments made in the road, even though the funding of road maintenance faces constraints (paras. 0-33). Technically, ADB4 and ADB5 are sustainable throughout their economic life, barring catastrophic environmental events. The socioeconomic benefits are also sustainable, unless external events induce an economic recession that results in a general downturn of economies in the region, similar to the Asian financial crisis of 1997. It is expected that the current frequency of landslides will continue to drop as the geologic features settle and vegetation growth on the slopes continues to increase, thus reducing the immediate environmental impact.

IV. A.

ACHIEVEMENT OF OTHER DEVELOPMENT IMPACTS

Socioeconomic Impacts

37. The projects made the road usable in all weather conditions. Depending on the section, the road used to be closed for 3-6 months per year during the wet season. Travel times have been reduced considerably; villagers interviewed reported that journeys of 40 km previously took a whole day or longer, but can now be made twice a day if needed, ensuring that, for instance, health services can be accessed in times of need. The travel cost has become affordable to most villagers, but the OEM could not establish trends in the actual costs for lack of baseline data. 38. Security used to be a major issue on N13 between Kasi and Louang Phrabang, requiring armed forces to patrol the road and sometimes accompany convoys. Robberies occurred frequently and discouraged the use of the route, thus isolating the northern provinces from Vientiane and the southern provinces. Since completion, security is no longer an issue, as travel speed increased and more villages were built along the route. Interviews revealed that many villagers had moved periodically to different locations before, but have stayed along the road since its improvement was completed. No resettlement issues were reported. However, the EA is increasingly concerned about the risk of encroachment on the road. 39. Tourism has increased along the route, with centers developing around Vang Vieng and Louang Phrabang, which was declared a world heritage site and thus attracts a lot of visitors. The increased convenience and security of road travel have contributed to a rise in the number of tourists visiting Louang Phrabang.23 This increase has enhanced the local tourism industry (accommodation, restaurants, transportation, and Internet services) and handicrafts production. 40. In addition, the projects had a positive effect on economic activities in the RIA. The feasibility study observed that only few cash crops were grown in 1987. In 2001, all villages the OEM visited reported a variety of income sources, including vegetables, papyrus-type grass that local enterprises use for papermaking in the Louang Phrabang area and export to Thailand,24 fishponds, and handicrafts. Women in one village produce traditional embroidery and travel to Louang Phrabang to send the final products to relatives in the United States. Prices for these embroideries are far above those achieved locally and payments are made by mail to Louang Phrabang. Without improved transportation services, this income source would not be accessible to the women of this village. Another source of income to the villagers derives from their employment in routine maintenance activities, while employment in construction was relatively minor and short-term in nature. 41. In larger villages, local transport services that have been set up facilitate selling of produce in neighboring villages, whereas smaller villages depend on traders coming from Louang Phrabang or Vientiane to purchase directly from the villagers. The OEM observed several places where roadside stalls for selling produce had been built and were used by

23

The increase in tourism has been facilitated by promotional activities, such as the Visit Lao year, and by introducing simplified visa formalities (available on arrival at the airport). 24 The production chain links the villagers, who collect the raw materials, via the producers of the paper to the tourist industry where the paper is sold locally or exported as wrapping paper, notebooks, or lamp shades. Prior to improving communication to Louang Phrabang, the raw material had no commercial value.

villagers living further away from the road. Farmers at one such place reported that they had walked two hours to reach the road. The increase in the level of prosperity reported by villagers was manifest in the standard of housing (in some villages, houses were atypical using rocks, which are more expensive than the usual building materials) and existence of television antennas and satellite dishes. A summary of the socioeconomic impacts is in Appendix 4. B. Environmental Impact 1. Immediate Environmental Impact of the Road

42. Road sections that traverse mountainous terrain experienced landslides and road slips, and continue to do so. This was, in part, anticipated at appraisal, but the chosen road alignment was selected as the best possible least-cost option. Other choices would have caused less landslides during the economic life of ADB4, but they would have required more earthworks during construction, resulting in a bigger environmental impact. 43. Effects of the earthworks and most landslides that occurred during construction can no longer be traced, as the terrain is entirely overgrown with vegetation. Whether the course of streams had been affected at the time is not clear. Older villages are located in areas where relatively little earthworks would have taken place, while newer villages were established after the earthworks were completed and thus were built on a changed terrain. The environmental sensitivity analysis undertaken for provincial and national roads under a recent TA25 did not suggest that ADB4 and ADB5 required environmental rehabilitation. 44. Landslides and road slips occurring at present are in areas where there are no settlements and fields do not seem affected. When removing landslides, earth is tipped over the edge of the road, thus affecting vegetation in that area. However, areas where that was previously the practice are now overgrown, which suggests that the vegetation in currently affected areas may recover in a similar way. Moreover, if soil from the landslides were to be trucked away, other deposit sites would have to be identified, which might increase the risk of impacting on cultivated areas. 45. The OEM observed a number of areas in which teak tree and bamboo plantations have been established. This biological approach is expected to arrest the risk of future landslides. In addition, these plantations provide an additional source of income to the villages concerned. 2. Environmental Monitoring and Management

46. The EA has an environmental monitoring unit, with social sector concerns, which is conducting some reviews similar to environmental assessments, but is not keeping environmental monitoring data. Instead, the Road Administration Division monitors the occurrence of landslides and their clearance. The recent TA (footnote 25) indicates that the technical capacities of the environmental unit of MCTPC and those of DCTPCs require strengthening and that incentives for working in these units need improvement. The MCTPC unit will be upgraded to a division with forthcoming ADB assistance for environmental management across several sectors that will support capacity building tailored to the needs of the EA.

25

TA 3070-LAO: Road Infrastructure for Rural Development, for $720,000, approved on 17 September 1998.

3.

Extended Environmental Risks

47. At the time of the OEM, there was no evidence of logging activities26 or logging vehicles along the road, although the latter could be due to the government ban on logging during the wet season. Recent classified traffic surveys (footnote 18) indicate that logging or timber trucks constitute about 30 percent of heavy vehicles during the dry season, implying that logging activities do occur in the RIA. However, the volume of logs is relatively low and the steep long grades of the Kasi-Xiang Ngeun section limit the access to large-scale logging areas. 48. The OEM observed the manifestations of slash-and-burn practices, but cannot assess whether these have increased since implementation of the projects or would have resulted therefrom. However, the reported increase in sedentary settlements (para. 0) suggests that slash-and-burn practices may have decreased as a result of the projects. Likewise, the OEM could not establish whether the exploitation of forest products had increased and threatens the environment. One forest product was reported to have gained in economic value (papyrus-type grass, para. 0), but the OEM could not determine whether the quantities that were collected would have adverse environmental effects. The recent TA (footnote 25) concluded that risks of increased logging or exploitation of wild animals or plant products did not exist for roads in Louang Phrabang or Vientiane provinces. C. Impact on Institutions and Policy

49. The projects aimed to strengthen domestic capabilities for designing, constructing, and maintaining the countrys road network and to enhance the Governments road maintenance capacity in the northern provinces. These institutional goals were pursued through loan allocations for supervision consultants (expected to train EA staff on the job), procurement of equipment for road maintenance workshops in the northern provinces, and advisory TAs. The EA received a total of 20 advisory TAs worth $10.0 million between 1984 and 2000, which assisted in various aspects of capacity building. One of these TAs was directly linked to the projects.27 50. The bridge management TA was not effective in building capacities or establishing functioning systems. Several other external agencies assisted in the same area without producing better results than the ADB TA. For instance, the final report of the recent TA (footnote 25) refers to data on bridges from a program prepared by the Road Administration Division in 1997, but does not mention a functioning and reliable database. Appendix 5 provides more details on the results of the bridge management TA.

26 27

Logging in this case does not include the numerous teak plantations along the project road. TA 1255-LAO: Bridge Management, for $300,000, approved on 21 December 1989.

V. A. Relevance

OVERALL ASSESSMENT

51. At appraisal, investments in the road sector were a priority as expressed in the development plans and the national budget of the Government and the country operational strategy of ADB. Important factors that led to the choice of the projects included the need to complete the upgrading of the national trunk road that connects the northern and southern parts of the country, and provides cross-country connections to the Peoples Republic of China and Thailand. This has created the basis for expanding the road network further. The sector remains important: it continues to receive a large portion of the national budget, features as one of the priorities in the Governments development plans, and is important as part of ADBs poverty reduction strategy through rural development. The projects are, therefore, rated highly relevant. B. Efficacy

52. To a large extent, the projects produced the outputs as planned, with some minor deviations. The degree to which road maintenance works were carried out could not be verified. Equipment and materials were procured and used to set up maintenance enterprises in the north and the south of the country (footnote 7) in locations from which the roads mentioned in the appraisal report were maintained. However, the OEM cannot establish with absolute certainty whether the specified road sections were maintained during implementation. The main component, i.e., the 6 m wide carriageway about 340 km long, was implemented as foreseen. The projects are rated efficacious. C. Efficiency

53. The projects used the existing alignment with minor deviations, which was the most costeffective solution and suited the existing traffic volume at the time of appraisal. Traffic growth projections indicate that N13 will be adequate to meet demand in the medium term. Only when higher traffic volumes are expected will a new and more costly alignment be necessary. The EIRR is 17.9 percent for ADB4 and 15.6 percent for ADB5. The projects are rated highly efficient. D. Sustainability

54. The Government is committed to maintaining this vital link to the northern provinces and allocating the necessary funds. Given that there are no other parallel road links, the Government has no choice in the matter. Other development impacts are considered equally sustainable, barring major economic crises in the region. Current problems with landslides are not expected to adversely affect the environmental sustainability in the long term. The projects are, therefore, rated most likely sustainable. E. Institutional Development and Other Impacts

55. The impact of the projects and the associated capacity-building TA (para. 0) on institutional development is less clear as the positive results observed in para. 0 can be attributed to other ADB TAs provided at the time. However, the projects generated other positive development impacts. They contributed to expanding the economic activities in the RIA, considerably reduced travel time, and made passage on the road safe and possible throughout

the year. This ensures that the northern provinces are accessible and can be integrated into the economy of the rest of the country, which is particularly important in light of the fact that the provinces north of Pak Mong are among the poorest in the country. In total, the projects made substantial contributions to socioeconomic development. F. Overall Project Rating

56. Given the positive performance of the projects against most of the above criteria, the projects are rated highly successful. G. Assessment of ADB and Borrower Performance

57. The Borrower adequately managed project implementation, was responsive to advice from ADB regarding project management issues, and is fully committed to the projects and their sustainability. The supervision exercised by ADB was equally satisfactory.

VI. A.

ISSUES, LESSONS, AND FOLLOW-UP ACTIONS

Key Issues for the Future

58. The road sector is an important part of the Governments development strategy as illustrated by high allocations from the public investment program. MCTPCs absorptive capacity makes the ministry a sought-after counterpart for projects. This has resulted in major investments in the sector, drawing on the Government budget to provide matching counterpart funds. Investments in expanding the road network will continue, increasing demands on the national budget for recurrent costs as well. This reduces the levels of funding available for investments in other sectors that are also essential to achieve the Governments poverty reduction goals. The Government faces the unenviable position of having to balance these different needs. This should be considered in identifying future assistance to the road and other sectors. 59. To address the recurrent funding issues for the road sector, and thus ensure that adequate funds are allocated for road maintenance, a road maintenance fund will be set up under a World Bank-funded project (footnote 19), also supported by ADB. The fund should help, provided it is implemented successfully. 60. The development of a local contracting industry capable of maintaining the roads faces several obstacles. The companies are relatively small (at most, medium-size) Given their financial position and limited capacity to raise the necessary funds, they will find it difficult to compete for large contracts. The import of equipment is subject to taxation, while international contractors can import construction equipment tax-free, provided the equipment is re-exported. In addition, there are so few contracts for road maintenance that some companies have work for only about six months a year. B. Lessons Identified

61. Overall, the road sector in the Lao PDR is dynamic and ready to learn from past experience, whether from these projects or others. Some examples of technical issues that were addressed during implementation and taken into account in other projects follow. 62. From the performance of some culverts in the weak geology of mountainous terrain, it was found that previous design practice had several flaws resulting in erosion problems. A particular problem was the culvert outlet, which was prone to erosion past the supporting gabion, resulting in failure and end collapse. Overall, the main areas of culvert design were improved for future road projects by including (i) a lean concrete base in poor soils, (ii) more gabions and channelization or stepping of outlet flow over grouted riprap, (iii) improved inlet geometry to ensure high flow capture rates, and (iv) wider side protection of outlets. 63. The problem of water flowing out onto the road from small uphill sources in times of storms rather than following the side drains was corrected by appropriate use of more culverts or side protection along the road. The highly saturated poor soils were initially not directly addressed in design, but now the practice of subsoil drains for drainage in wet weak soils has been introduced. For ADB4, it was an addition during the construction stage and subsequently as part of landslide repair.

64. As cut slope failures were partially due to long continuous faces, the design practice was amended to ensure that benching at about 10 m intervals was used for future projects. C. 65. Follow-Up Actions The EA needs to ensure that the following actions are taken as soon as possible: (i) Areas with major damages to the road surface are repaired to avoid further deterioration. These repairs need to be implemented before the next rainy season, when some of the road sections risk being washed out further. Road works under way during the site visit make the OEM confident that action is and will be taken on a continuous basis. Arrangements should be made to ensure that routine maintenance is undertaken along the entire length of ADB4 and ADB5. This may require the EA to engage small contractors to cover areas beyond the reach of villages that otherwise undertake routine maintenance activities. The EA should expand the road markings, particularly in dangerous curves, to increase road security. Some initiatives to set up road signs have been taken, but have to continue to cover all road sections in need of markings.

(ii)

(iii)

APPENDIXES

Number

Title

Page

Cited on (page, para.)

1 2 3 4 5

Summary of Project Costs ADB Assistance to the Road Sector in Lao PDR Economic Analysis Achievement of Development Objectives Bridge Management Project

18 19 20 26 30

7, 0 8, 6 7, 24 18, 0 19, 0

SUPPLEMENTARY APPENDIX (available on request) A Photographs

Appendix 1 SUMMARY OF PROJECT COSTS ($000 current prices)

Appraisal Estimate Component FX LC Total FX As % of Total Actual FX LC Total FX As % of Total Change (%) FX LC Total

A. Loan 1009-LAO(SF) 1 Road Improvement 2 Periodic Maintenance 3 Consulting Services 4 Service Charge 5 Prior TA Cost 6 Unallocated Subtotal (A) 22,700 4,200 3,250 800 100 7,950 39,000 1,800 24,500 600 370 1,030 4,800 3,620 800 100 8,980 93 88 90 100 100 89 91 34,559 4,407 4,743 922 54 44,685 3,949 38,508 4,407 4,743 922 54 90 100 100 100 100 92 52 5 46 15 -46 -100 15 119 -100 -100 -100 4 57 -8 31 15 -46 -100 14

3,800 42,800

3,949 48,634

B. Loan 1108-LAO(SF) 1 Road Improvement 2 Periodic Maintenance 3 Consulting Services 4 Service Charge 5 Unallocated Subtotal (B) 20,500 6,000 1,500 600 5,400 34,000 1,400 21,900 1,000 300 1,000 7,000 1,800 600 6,400 94 86 83 100 84 90 26,905 5,696 2,752 638 35,991 1,062 27,967 5,696 2,752 638 96 100 100 100 97 31 -5 83 6 -100 6 -24 -100 -100 -100 -71 28 -19 53 6 -100 -2

3,700 37,700

1,062 37,053

Total

73,000

7,500 80,500

91

80,676

5,011 85,687

94

11

-33

= not applicable; FX = foreign exchange; LC = local currency; SF = Special Funds; TA = technical assistance.

Sources: ADB appraisal reports and project completion report.

Appendix 2 ADB ASSISTANCE TO THE ROAD SECTOR IN LAO PDR (as of 30 November 2001)
No. Title Amount ($'000) Approval Source

A. Technical Assistance 1. Project Preparatory 0295 Vientiane Plain Road Improvement 0621 Second Road Improvement 0873 Southern Roads Improvement 1019 Northern Roads Improvement 1639 Preparation of the Sixth Road Improvement 1896 Seventh Road Improvement 2242 Xieng Khouang Road Improvement 2889 Rural Access Roads Improvement 3756 Roads for Rural Development Subtotal 2. Advisory 0656 Vientiane Plain Road Improvement 0796 Road Maintenance Study 0797 Implementation of Second Road Improvement 0923 Road Maintenance Training 0924 Implementation of Third Road Improvement 1255 Bridge Management 0797 Implementation of Second Road Improvement (Supplementary) 1494 Road Maintenance and Equipment Training 1495 Prestressed Concrete Bridge Training 1494 Road Maintenance and Equipment Training (Supplementary) 1897 Privatization and Management of Road Sector Institutions 2248 Upgrading of the School of Communication and Transport 2388 Feeder Roads Maintenance Training 2389 Management Information System in MCTPC 2862 Management Information System (Phase II) 3070 Road Infrastructure for Rural Development 3348 East-West Corridor Coordination 3396 Assessing a Concession Agreement for the Lao PDR Component of the Chiang Rai to Kunming Highway 2862 Management Information System (Phase II) (Supplementary) 3557 Strengthening Social and Environmental Management Capacity in the Department of Roads Subtotal Total Technical Assistance B. Loan 0643 Vientiane Plain Road Improvement 0788 Second Road Improvement 0866 Third Road Improvement 1009 Fourth Road Improvement 1108 Fifth Road Improvement 1234 Sixth Road Improvement 1369 Champassak Road Improvement 1533 Xieng Khouang Road Improvement 1795 Rural Access Roads Total Lending

150 250 330 350 100 500 530 600 400 3,210 490 285 1,200 225 1,000 300 250 600 570 400 950 300 350 350 700 720 690 150 280 200 10,010 13,220

1979 1984 1987 1988 1992 1993 1994 1997 2001

TASF TASF TASF TASF TASF JSF JSF JSF JSF

1984 1986 1986 1987 1987 1989 1991 1991 1991 1993 1993 1994 1995 1995 1997 1998 1999 2000 2000 2000

UNDP TASF UNDP TASF UNDP TASF France TASF TASF TASF TASF JSF JSF JSF JSF JSF JSF TASF TASF TASF

8,000 12,000 19,000 39,000 34,000 26,000 48,000 46,000 25,000 257,000

1983 1986 1987 1989 1991 1993 1995 1997 2000

ADF ADF ADF ADF ADF ADF ADF ADF ADF

ADF = Asian Development Fund; JSF = Japan Special Fund; MCTPC = Ministry of Communications, Transport, Post and Construction; TASF = Technical Assistance Special Fund; UNDP = United Nations Development Programme.

Appendix 3, page 1 ECONOMIC ANALYSIS A. General Assumptions

1. The economic analysis of the benefits and costs of the projects follows the same approach as that used at appraisal and completion, unless specified otherwise. The economic life of the projects is assumed to be 20 years. The residual value of the road at the end of the economic life of the projects is assumed to be 25 percent. 2. Benefits are derived from vehicle operating cost (VOC) savings realized by existing traffic and benefits from diverted and generated traffic. The costs included in the calculation are the capital costs (projects economic cost) and the cost of routine, periodic, and emergency maintenance. Savings are estimated by comparing costs and benefits that would arise without the projects and those with the projects. The valuation is expressed in dollars in constant 2001 prices. 3. Not included in the economic evaluation are nonquantifiable benefits that are described in detail in Achievement of Other Development Impacts (Section IV) of the project performance audit report. B. Traffic Growth

4. To ensure comparability, the traffic counts for the evaluation were made at the same counting stations used for the project completion report. The counts were done for three consecutive days and adjusted to represent the typical annual average daily traffic. Passenger traffic increased by 150-230 percent and goods traffic by an average 50 percent over counts at project completion (Table A3.1) Table A3.1: Traffic Count (annual average daily traffic)
Passengers Road Section Vang Vieng-Kasi Kasi-Louang Phrabang PC 18 38 LDV 95 133 LBus 13 27 Bus 23 25 Total 149 223 MGV 28 59 Goods HGV 11 24 VHGV 0 0 Total 39 83

Louang Phrabang-Nam Ou Nam Ou-Pak Mong

122 37

717 95

64 24

81 11

984 167

170 33

49 22

2 0

221 55

PC = passenger car; LDV = light delivery vehicle (pickup, van, or 4WD); LBus = truck (MGV) used as bus, Bus = medium-size bus (30-35 passengers); MGV = medium goods vehicle (2 axles, 6-8 tons (t) load capacity); HGV = heavy goods vehicle (3 axles, 10-15 t load capacity); VHGV = very heavy goods vehicles (>3 axles, typically HGV with trailer).

5. Traffic is assumed to grow at an average annual growth rate of 6 percent for all years after 2001, except for the Louang Phrabang-Pak Mong section, where generated traffic is expected to grow at 14 percent annually for the next five years (para. 7). Afterwards, a 6 percent growth rate is assumed.

Appendix 3, page 2 1. Existing Traffic

6. Benefits to existing traffic are based on VOC savings to existing traffic, growing at 6 percent annually. Traffic growth beyond this is considered under generated traffic. 2. Generated Traffic

7. The benefits from generated traffic are calculated as half of the VOC savings of actual incremental traffic that was observed between project completion and evaluation, i.e., traffic generated above the assumed growth rate of 6 percent for existing traffic. After 2001, generated traffic is assumed to grow at the same rate as existing traffic, except for the next five years along the Louang Phrabang-Pak Mong section, where a higher rate of traffic growth is expected. This seems justified, given the larger-than-expected growth rates observed and the potential development of the region. Incremental traffic resulted from improved security along the route, reduced travel time, increased affordability of transportation services, and growth in tourism. 3. Diverted Traffic

8. The benefits from diverted traffic used the assumptions made at appraisal and project completion about attracting river traffic to the road. Figures in the project completion report were converted to constant 2001 prices and escalated by 3 percent per annum, reflecting the reduced future potential to realize savings from diverted river traffic. C. Vehicle Operating Cost

9. The evaluation adopted the same approach taken in the project completion report and used VOC data generated for the Xieng Khouang Road Improvement Project,1 which has topographic characteristics similar to those of the project road. The VOC is in constant 2001 prices (Table A3.2). Table A3.2: Vehicle Operating Cost ($/km)
Passengers Road Section With Project Vang Vieng-Louang Phrabang Louang Phrabang-Pak Mong Without Project Vang Vieng-Louang Phrabang Louang Phrabang-Pak Mong 0.899 0.918 1.488 1.162 1.500 1.530 1.269 1.295 1.500 1.530 1.570 1.602 1.611 1.643 0.391 0.398 0.517 0.527 0.760 0.775 0.875 0.892 0.760 0.774 0.782 0.797 0.806 0.822 PC LDV LBus Bus MGV Goods HGV VHGV

PC = passenger car; LDV = light delivery vehicle (pickup, van, or 4WD); LBus = truck (MGV) used as bus, Bus = medium sized bus (30-35 passengers); MGV = Medium goods vehicle (2 axles, 6-8 tons (t) load capacity); HGV = heavy goods vehicle (3 axles, 10-15 t load capacity); VHGV = very heavy goods vehicles (>3 axles, typically HGV with trailer).

Loan No. 1533-LAO(SF): Xieng Khouang Road Improvement Project, for $46.0 million, approved on 9 September 1997.

Appendix 3, page 3 D. Project Economic Costs

10. At completion the financial cost was taken as equal to the projects economic cost, because no tax was raised on the project inputs. No other adjustments were made. The reevaluation adjusted the financial cost by applying a conversion factor of 0.92 to the construction cost of the projects. Table A3.3 summarizes the projects economic costs in constant 2001 prices, as derived from the projects financial costs. Table A3.3: Project Economic Costs ($000 in constant 2001 prices)
Road Section Vang Vieng-Louang Phrabang Louang Phrabang-Pak Mong Total 941 2,628 1990 941 1991 2,628 1992 7,098 168 7,266 1993 5,670 8,164 13,834 1994 6,275 2,686 8,961 1995 12,367 6,789 19,156 1996 7,668 9,513 17,181 1997 735 7,433 8,168 Total 43,382 34,753 78,135

E.

Maintenance Costs

11. In reevaluating the economic internal rate of return (EIRR), actual maintenance costs between completion and evaluation were included in the cost stream. 12. Using data provided by the Executing Agency (EA), future maintenance cost requirements were projected based on the desired 2001 budgetary levels for the project road, and nearby national roads (gravel) for the without-projects scenario. Periodic maintenance requires resealing, the cost of which the EA estimates at $14,000-$16,000 per kilometer for the road financed by the projects. The cost is lower for unpaved roads, assumed for the withoutprojects situation. The periodic maintenance cost was annualized over an eight-year period (the normal interval for resealing) as the periodic maintenance cycle had already begun on the road along the Kasi-Louang Phrabang section (ADB4). 13. In addition to maintenance costs assumed at completion, emergency maintenance cost was added, as this is a significant annual cost to the projects road due to a relatively high number of slope failures each wet season. Emergency maintenance costs are expected to decline to 25 percent of current levels in five years as slopes begin to stabilize. 14. For the without-projects scenario, it was assumed that road rehabilitation would have to be undertaken to keep it serviceable. The rehabilitation costs assumed in the feasibility study were converted into constant prices (2001). It is assumed that such rehabilitation would be necessary every 10 years, and thus have been added as a benefit to the capital cost stream in the years 2001 and 2011. 15. Maintenance costs assumed at project completion and evaluation for scenarios with and without projects are compared in Table A3.4.

Appendix 3, page 4 Table A3.4: Road Maintenance Costs ($ per kilometer or bridge, in constant 2001 prices)
At Completion Road Section With Project Flat terrain Mountainous terrain Bridges Without Project Flat terrain Mountainous terrain Bridges 329 486 115 828 1,096 257 447 338 9,500 11,000 157 313 31 856 877 385 380 136 16,200 13,900 Routine Periodic At Evaluation Routine Periodic

16. The difference in maintenance costs is explained by the unusually low cost estimates for periodic maintenance adopted in the project completion report, which did not include resealing normally undertaken under periodic maintenance. F. Economic Evaluation

17. Following the examples of the appraisal and project completion reports, the EIRR was reestimated separately for the sections financed under each loan. A summary of the EIRRs estimated at appraisal, completion, and evaluation is in Table A3.5. The differences in the rates of return can be explained by the increase in traffic growth that is higher than expected at project completion, and benefits derived from time savings. However, these positive effects are dampened by higher road maintenance costs. This is particularly valid for the Louang Phrabang-Pak Mong stretch, where maintenance for the without-project road is estimated to be much lower than the maintenance cost with the Project. While based on the EAs standard unit costs, it is a conservative assumption, because the costs of keeping the road open might be higher. Table A3.5: Comparison of Economic Rates of Return (percent)
Road Component Vang Vieng-Louang Phrabang Louang Phrabang-Pak Mong Appraisal 11.7 12.0 Completion 13.3 12.0 Evaluation 17.9 15.6

18.

The cost and benefit streams are shown in Tables A3.6 and A3.7.

Appendix 3, page 5 Table A3.6: Economic Reevaluation of ADB4 Loan 1009-LAO(SF): Fourth Road Improvement Project (Vang Vieng-Louang Phrabang)

Costs
Capital
Year

Total Benefits from Traffic

Existing
Passengers

Maintenance

Diverted
Goods

Generated
Passengers

Total
Passengers

Net
Total

Goods Passengers

Goods

Goods

Benefits

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

-941 -2,628 -7,052 -5,605 -6,171 -12,254 -7,639 -600 -870 -900 -867 -1,717 3,166 -1,661 -391 -361 -331 -301 -271 -271 -271 -271 -271 3,166 -271 -271 -271 -271 -271 10,723 -271 367 395 423 450 478 498 528 559 593 628 666 706 748 793 841 891 945 1,002 1,062 1,125 1,193 3,513 3,585 3,657 3,729 3,801 4,694 4,976 5,275 5,591 5,927 6,282 6,659 7,059 7,482 7,931 8,407 8,912 9,446 10,013 10,614 11,251 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 21 23 24 25 27 29 30 32 34 36 38 41 43 46 48 51 54 57 61 65 1,590 2,007 2,423 2,840 3,256 4,253 4,508 4,779 5,066 5,370 5,692 6,033 6,395 6,779 7,186 7,617 8,074 8,558 9,072 9,616 872 1,046 1,552 2,633 5,024 78 82 87 92 98 104 110 117 124 131 139 147 156 166 175 186 1,958 2,402 2,846 3,290 3,734 4,751 5,036 5,338 5,659 5,998 6,358 6,739 7,144 7,572 8,027 8,508 9,019 9,560 4,385 4,653 5,234 6,387 8,852 4,801 5,089 5,394 5,718 6,061 6,424 6,810 7,218 7,652 8,111 8,597 9,113 9,660 6,343 7,055 8,080 9,678 12,586 9,552 10,125 10,732 11,376 12,059 12,782 13,549 14,362 15,224 16,137 17,106 18,132 19,220 20,373 21,595 22,891 EIRR =

-941 -2,628 -7,052 -5,605 -6,171 -12,254 -1,296 5,584 7,180 8,811 10,869 11,057 9,734 10,371 11,045 11,758 12,511 13,278 14,091 14,953 15,866 20,000 17,861 18,949 20,102 21,324 33,342 17.9%

10,134 10,239 10,742 10,854 11,386 11,505

68 10,193

Appendix 3, page 6 Table A3.7: Economic Reevaluation of ADB5 Loan 1108-LAO(SF): Fifth Road Improvement Project Louang Phrabang-Pak Mong

Costs
Capital
Year

Total Benefits from Traffic

Existing
Passengers

Maintenance

Diverted
Goods

Generated
Passengers

Total
Passengers

Net
Total

Goods Passengers

Goods

Goods

Benefits

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

-169 -8,138 -2,677 -6,770 -9,466 -7,388 -825 -281 -498 667 -192 -147 -145 -143 -141 -139 -139 -139 -139 -139 667 -139 -139 -139 -139 -139 -139 8,652 -139 41 44 47 50 56 59 63 66 70 75 79 84 89 94 100 106 112 119 126 134 142 374 399 425 450 501 532 563 597 633 671 711 754 799 847 898 952 1,009 1,070 1,134 1,202 1,274 8 8 8 9 9 9 10 10 10 10 11 11 11 12 12 12 13 13 14 14 14 205 211 217 224 230 237 244 252 259 267 275 283 292 300 1,765 1,917 2,070 2,223 3,935 4,486 5,114 5,830 6,646 7,577 8,032 8,513 9,024 9,566 431 549 666 783 901 1,027 1,170 1,334 1,521 1,734 1,838 1,948 2,065 2,189 2,320 2,460 2,607 2,764 2,929 3,105 3,292 1,813 1,969 2,126 2,282 4,000 4,555 5,186 5,906 6,727 7,662 8,121 8,608 9,125 9,672 10,252 10,866 11,518 12,209 12,941 13,717 14,539 1,009 1,158 1,308 1,457 1,632 1,795 1,978 2,183 2,413 2,672 2,824 2,985 3,156 3,337 3,528 3,730 3,944 4,171 4,411 4,666 4,935 2,823 3,128 3,433 3,739 5,632 6,350 7,164 8,089 9,140 10,334 10,946 11,594 12,281 13,008 13,779 14,597 15,462 16,380 17,352 18,382 19,474 EIRR =

-169 -8,138 -2,677 -6,770 -9,466 -4,565 2,303 3,152 3,241 6,108 6,203 7,019 7,946 8,999 10,195 10,807 11,455 12,142 12,869 14,307 14,458 15,323 16,241 17,213 18,244 27,987 15.6%

309 10,140 319 10,748 328 11,393 338 12,077 348 12,801 359 13,569 369 14,383

Appendix 4, page 1 ACHIEVEMENT OF DEVELOPMENT OBJECTIVES

Development Objective Development Goal: Contribute to the development of rural areas in the northern provinces Indicator Baseline Situation Evaluation Observation

Economic activity: Agriculture: composition and quantity of production Forestry products: composition and quantity of use and preservation Mining: quantity of extraction Tourism: number of tourists, number and type of tourist establishments Trade: quantity and direction of trade

29% of national rice production, while home to 38% of population Cash crops play a marginal role. Animal husbandry is an important source of cash. Logging is marginal in all northern provinces, except in Sayaburi. Other forest products (spices, resins, and plants) are an important source of income. Very limited exploitation of mineral resources Very limited industrial activities; mostly geared to the local market (e.g., rice mills, sawmills, small workshops)

Changes over Baseline Situation: Villages still reported rice production insufficient for 12 months a year. However, cash crops have become a significant part of the agriculture sector. All villagers reported growing a variety of vegetables and fruits that are sold on local markets, in Vientiane, and Louang Phrabang, and exported to the Peoples Republic of China. Animal husbandry is still an important part of the rural economy, although the composition of livestock may have changed in some locations. The Operations Evaluation Mission (OEM) could not ascertain the extent to which logging is taking place or has increased. There is evidence of slash-and-burn agriculture on the hillsides. Since harvesting forest products and hunting of animals is illegal, no such activities have been reported. However, a papyrus-type of grass is being collected and marketed to small-scale papermaking enterprises. Before the road existed and before the boom in tourism, this raw material had no economic value. No major changes in mining industries were observed. Industrial activities in villages continue to be limited to small-scale mills (rice or saw) and shops. However, small-scale transport services have developed in larger towns. The evaluation was not able to verify the situation in the greater road influence area (RIA), where greater hardship may still be experienced. Other Development Initiatives: The OEM was not able to obtain data on other development initiatives in the RIA implemented in the past. Currently some 36 projects are being implemented in the two provinces in the RIA, 7 of which are related to rural development. Risks/External Factors: The Asian financial crisis of 1997 affected the Lao Peoples Democratic Republic and may have reduced previous results, but villages appear better-off than before the two projects. Issues of Attribution and Isolation: Transportation plays an important role in facilitating other development initiatives, but not all of the observed changes can be attributed to the projects.

Appendix 4, page 2

Development Objective

Indicator

Baseline Situation

Evaluation Observation

Services and infrastructure Education services: number and location of schools with teachers Medical services: number and location of health facilities with paramedical staff or midwives Financial services: location and access to service (actual) Electricity: connections and actual services Water supply: connections and actual services

Limited finance hampers trade transactions. Irrigation system would be essential to support agriculture development.

Changes over Baseline Situation: Agriculture seems to focus on dryland rice rather than irrigated paddy fields, although the situation may be different in the greater RIA. Financial services are available in some parts of the RIA, but not as effective as desirable. All villages reported having school facilities, but most of them existed before the projects were implemented. Over the past years, many of the schools have been expanded to cover more classes. In all schools, at least one teacher was present each, however, sometimes teaching as many as 76 pupils. Health facilities do not exist in all villages, but are accessible in neighboring villages or district towns. Electricity connections existed in a number of villages and the distribution network is currently being expanded. In villages with electricity, the OEM observed that electrical appliances ranged from refrigerators to televisions, including antennas and satellite dishes. All villages reported no problems with water supply, but drew water mostly from natural sources. Only one village reported that a well/pump was under consideration. Other Development Initiatives: The OEM was not able to obtain data on other development initiatives in the RIA implemented in the past. Currently some 36 projects are being implemented in the two provinces in the RIA, 3 of which are related to the health sector, 3 to education, and 1 to water supply (not necessarily in rural areas). Risks/External Factors: Providing services depends on allocations to these sectors, which will depend on government priorities. Furthermore, building facilities that provide services does not automatically result in desired impacts. Issues of Attribution and Isolation: Transportation plays an important role in facilitating other development initiatives, but not all of the observed changes can be attributed to the projects.

Appendix 4, page 3

Development Objective Immediate Objectives: Increase the efficiency of moving passengers and goods -

Indicator

Baseline Situation

Evaluation Observation

Economic internal rate of return (EIRR) Cost to customer (fare price for passengers, tonnage price for goods)

No baseline EIRR Villagers recalled that prices for transportation were possibly similar or somewhat higher in dollar terms before the projects were implemented/ completed.

Changes over Baseline Situation: See Economic Analysis (Appendix 3). Prices may have gone down somewhat. In addition (and possibly more importantly), transportation has become more affordable to villagers as a result of higher household income levels. Other Development Initiatives: No data/not applicable Risks/External Factors: The transport sector, largely private, has developed to provide needed services. Issues of Attribution and Isolation: The cost of transportation is directly attributable to the projects. Changes over Baseline Situation: See Economic Analysis (Appendix 3). Transport services available now include passenger buses, including air-conditioned coaches, with 7 buses per day between Vientiane and Louang Phrabang. In addition, passenger cars and trucks use the road. Other Development Initiatives: No data/not applicable Risks/External Factors: No data/not applicable Issues of Attribution and Isolation: The improved road conditions made it possible to change the type of vehicles; thus, this result is directly attributable to the projects. Changes over Baseline Situation: See Economic Analysis (Appendix 3) Other Development Initiatives: No data/not applicable Risks/External Factors: VOC depends on the cost of transport-related expenditures (cost of cars, fuel, etc.), the consumption of which depends partly on the road condition, partly on other factors such as taxes. Issues of Attribution and Isolation: Changes in VOC result directly from the projects.

Increase the mobility of people and goods

Passengers/ goods transported (total number/tonnage) Number and type of transport available

See Economic Analysis (Appendix 3) When road use was feasible, only army trucks and other heavy vehicles traveled the route. Some of these vehicles would not stop at the smaller villages.

Project Outcomes: Reduce the cost of transportation

Vehicle operating cost (VOC)

See Economic Analysis (Appendix 3)

Appendix 4, page 4

Development Objective Reduce travel time

Indicator

Baseline Situation

Evaluation Observation

Time (hours)

Villagers recalled that journeys as short as 40 kilometers might take a whole day. Staff and consultants of MCTPC associated with the projects early on reported that the stretch from Pak Mong to Louang Phrabang took 11 hours (116 kilometers), while Louang Phrabang to Vang Vieng would take about 1 day. The road between Vang Vieng and Louang Phrabang was closed for 3 months a year during the wet season. The dirt road from Louang Phrabang could not be used for 6 months per year and was heavily overgrown.

Changes over Baseline Situation: The distance from Vang Vieng to Louang Phrabang can be covered in about 8 hours, while the trip to Pak Mong can be done in 2-3 hours. Other Development Initiatives: No data/not applicable. Risks/External Factors: Should the conditions of the projects road be allowed to deteriorate (failing to maintain it in present conditions), travel times will become extended again. However, it appears unlikely that the road would return to the preproject situation within its economic life. Issues of Attribution and Isolation: Connection between road condition and travel time is clear. Changes over Baseline Situation: The project road is in good condition and can be used year-round, although landslides are a risk during the rainy season and may block the road for several hours. Other Development Initiatives: Road maintenance costs have been financed from other externally assisted projects, including those financed by the World Bank. Risks/External Factors: The topography and soil quality are such that it will take time before slopes are settled and the occurrence of landslides is reduced. This was a risk that could have been avoided if the cost per kilometer of road built had been increased beyond the economic level. Issues of Attribution and Isolation: The benefits are clearly attributable to the projects, although sustaining the benefits is subject to maintenance funds provided by other sources.

Make roads/areas accessible year-round (all-weather roads)

Usable in all seasons (Yes/No)

Note: Information on the baseline situation was extracted from the feasibility study produced under TA 1019-LAO: Northern Roads Improvement Project, for $350,000, approved on 19 July 1988; other documents; and discussions with relevant government offices and people living along the road. The evaluation observations are based on interviews in seven villages along the road, observations made when traveling the length of the road, and discussions with knowledgeable officials and representatives of external agencies.

Appendix 5, page 1 BRIDGE MANAGEMENT PROJECT

Planned Objective and Scope Reported Result at Completion Evaluation Observation

Objective: Provide institutional support to the Ministry of Communications, Transport, Post and Construction (MCTPC) to strengthen its bridge management unit and those of provincial arms of the ministry. Train staff in design, construction, and maintenance of different types of bridges. Develop a transport database. Outputs: 1. Review of current (1991) Submitted as part of the Inception MCTPC practices for bridge Report. management including data collection, planning, programming, design, construction, and maintenance. 2. Manuals/guidelines for All applicable manuals (a total of 12), which are part of the bridge Inspection of bridges management system (BMS) were Collection and storage of bridge edited from the original versions and reissued for the BMS Lao project. data Rating and posting of load limitations for bridges Maintenance of bridges Three manuals (superficial maintenance, routine inspection, and principal inspection) were translated into Lao. A large portion of the country was surveyed, leaving only about 30 percent of the country uncovered in inaccessible areas. Drawings were provided in the final report of the consultants. Established on the basis of a model used in Thailand, adjusted to local requirements. Drawings are available in the final report of the consultants. However, the report and drawings are not used. Not available.

Not available, but the Operations Evaluation Mission (OEM) was told that the manuals were not sufficiently adapted to the Lao context. Therefore, they were not adopted.

3. Comprehensive inventory of all bridges on national and provincial roads and a complete database on them, including details on unbridged crossings.

4. Centralized computer-based bridge management information system, basically using existing software.

Not in use.

5. Standards for bridge design and A review was carried out and Cannot be traced. specifications, revising existing recommendations made, but no action MCTPC standards. had been taken by the time the technical assistance (TA) was completed. A Swedish-funded consultant was also advising MCTPC on the same issue.

Appendix 5, page 2

Planned Objective and Scope

Reported Result at Completion

Evaluation Observation

6. Additional or modified standard designs for varying span lengths for assessed traffic loadings, based on standard designs existing with MCTPC. 7. Economic evaluation model for bridge replacements.

Recommended using more composite steel concrete bridges. Provided some design details for this type of bridges.

Cannot be traced.

The bridge replacement was dropped from the terms of reference. Nonetheless, the survey (output 3) was used to collect data for economic evaluation. This information was entered into the database (output 4).

Cannot be traced.

8. Road maps (scale 1:50,000) showing the bridges on national and provincial roads with their corresponding load limits. 9. Computerized transport database, including a manual on updating the system. 10. Trained staff at provincial branches of MCTPC for data collection and at MCTPC for operating weigh bridges for axle load assessment. Not reported.

See above (output 3).

Cannot be traced.

Two formal training courses were organized. After completion of the first course, the trainees (from the maintenance division, bridge management division, and training center) inspected bridges throughout the country. The second course trained staff from provincial maintenance units in bridge maintenance and routine inspections. Data input training for the computerized system was undertaken continuously, formally and through onthe-job training.

The OEM was not able to trace the trainees. In any case, all that could have been established was whether trainees attended the courses and remembered them. To assess the impact of training, a profile of trainees skills, knowledge, and work requirements is needed for before and after the training.

11. Manual (English and Lao) covering all aspects of the bridge management system. 12. Advice on environmental aspects of bridge construction and management

A set of manuals was prepared and 12 copies given to MCTPC.

Not available.

Advice on environmental issues was provided during seminars and training sessions. The consultants were of the opinion that the TA had impact on the environment.

Cannot be traced.

Sources: TA report and final report of the consultants.