Business Opportunities - Advance Action on Procurement and Retroactive Financing

Title of Proposed Project: Hebei Small Cities and Towns Development Demonstration Sector Project

The proposed project will enable improved urban infrastructure delivery through the implementation of environmentally sustainable subprojects in selected small cities and towns in Hebei Province. The Project is being processed as a sector loan to allow the Hebei provincial government (HPG) to respond to rapidly changing needs of cities and towns across the province. The Project includes about 10 subproject small cities and towns. Detailed assessment and analyses have been undertaken for the three core subprojects: Bazhou City, Zhaoxian County, and Zhengding County. Subsequent subprojects will be prepared and appraised during project implementation following an agreed set of criteria and procedures. The Bazhou subproject includes (i) Mangniu River Improvement and Sewer Network Rehabilitation component, which will improve river water quality and flood control, reduce groundwater pollution and support integration of environmental infrastructure improvements; and (ii) Shengfang Town Water Supply, which will improve water supply reliability and quality and reduce the number of shallow groundwater wells. The Zhaoxian subproject has three components: (i) wastewater treatment, (ii) heat supply, and (iii) solid waste management. These improvements will improve urban environmental quality by reducing air, water, and land pollution. In Zhengding, the solid waste management component will provide conveniently located collection and transfer points and a processing facility for recyclables and composting for producing organic fertilizer. This component will improve the living environment and enhance tourism activities considering that Zhengding has rich cultural heritage. All components consist of basic urban infrastructure to support the development of urban expansion of small cities and towns, enhance the quality of the urban environment, and attract rural in-migrants to work in light industry and the service sector.

Brief Description of Goods and Related Services, Works or Consulting Services to be Procured:

ADB has approved HPG's request for advance contracting and retroactive financing to finance recruitment of consultants, training, and procurement of goods and civil works for the Bazhou subproject contract packages and retroactive financing of eligible expenditures of up to $20 million (about 20% of the ADB loan). The expenditures must have been incurred before effectiveness of the relevant loan but, generally, no earlier than 12 months before the signing date of the Loan Agreement. All advance contracting and retroactive financing will be undertaken in conformity with ADB's Procurement Guidelines and ADB's Guidelines on the Use of Consultants.

Date of Advance Contracting and Retroactive Financing Approval: 4 December 2008