The objectives of the Project is to improve the living conditions and the quality of life of the urban population.
The Project follows a sector lending approach and supports sector policies on urban development, including the Government's Action Plan for 2004-2008 and program to provide 40,000 households with opportunities to live in housing with improved basic services. The Project will consist of four components: (i) A: improvement of basic urban services, (ii) B: urban road improvement, (iii) C: small loans for water connections and on-plot facility improvements, and (iv) D: institutional development and training.
Project implementation will start with two core subprojects: (i) improvement of the Hailaast road section in Ulaanbaatar; and (ii) water supply, sanitation, and solid waste management in Erdenet. The remaining subprojects will be identified and formulated during project implementation in accordance with rigorous procedures for screening, identification, selection, and appraisal of the subprojects. The Asian Development Bank (ADB) reviewed the two core subprojects and found that they are viable from a technical, institutional, social, financial, economic, and environmental perspective. For each of the remaining subprojects, the Ulaanbaatar municipal government and concerned aimag (province) governments and public urban services organizations (PUSOs) will prepare a feasibility study, including a resettlement plan and environmental impact assessment. For the water supply subcomponent, concerned aimag governments will be required to indicate strong political commitment to implement the tariff reforms to ensure repayment to the Government.
|Project Rationale and Linkage to Country/Regional Strategy
Mongolia experienced rapid urbanization during the second half of the 20th century, mainly because of rural-to-urban migration. The urban population is now 60% of the national population of 2.56 million. Urban areas in Mongolia present two very different and distinct patterns of residential accommodation: apartment areas and ger (traditional tent) areas. Apartment areas are formally laid out to include permanent housing based on socialist planning practices and featuring multi-family housing surrounded by (vaguely defined) open space. These areas have the benefit of full utility services, including heating and hot water. By contrast, ger areas are typically long strips of large, unserviced plots with wide unpaved roads on one or two sides. Both types of layout are found in virtually all of the country's urban settlements. Following the withdrawal of Soviet support at the start of the 1990s, there has been relatively little extension of apartment areas but ger areas have experienced continued growth in most cities as most in-migrants live in ger areas.
Urban areas in Ulaanbaatar are growing rapidly because of substantial population migration from rural areas. The total population in Ulaanbaatar is estimated at over 1 million, including about 80,000 students and 60,000 non-registered residents. Some 60% of the total population lives in ger areas. In 2004, Ulaanbaatar;s road network totaled about 376 kilometers (km), comprising 77 km (20.5%) of national roads, 190 km (50.5%) of city roads, and 109 km (29.0%) of district or municipal roads. Road construction has been increasing slowly by 1.2% per annum for the past 5 years. Most roads in Ulaanbaatar are poorly maintained asphalt or gravel roads. About 288 km of roads in the city need to be reconstructed or rehabilitated. Only 10% of the city roads have drainage systems, which often are clogged with trash.
The major issues in the urban development sector in Mongolia are (i) deficiency in the quality of urban infrastructure and services, especially in ger areas; (ii) lack of community participation in the management and operation of urban services; (iii) lack of cost recovery and inadequate financial management in public services; (iv) lack of financial and organizational autonomy of the PUSOs; (v) lack of capacity of local governments, through the PUSOs, to provide and operate urban infrastructure and facilities; (vi) reluctance of the Government to acknowledge the permanent status of gers or hashaas (residential plots); (vii) inadequate urban roads in Ulaanbaatar; (viii) poor management and maintenance of urban roads in Ulaanbaatar; and (ix) health problems and associated economic loss.