Papua New Guinea: Pilot Border Trade and Investment Development Project

Sovereign Project | 42135-013

Summary

The Project will remove the infrastructure bottleneck along the northern transport corridor connecting West Sepik Province (WSP) of Papua New Guinea and Papua Province of Indonesia, and improve the investment environment in WSP to enable WSP to capture trade opportunities for development. It will finance (i) the border facilitites at Wutung, (ii) consulting services for project implementation and construction supervision, (iii) capacity development, and (iv) a social development program including HIV/AIDS prevention.

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Consulting Notices

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Procurement Notices

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Procurement Documents


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Project Name Pilot Border Trade and Investment Development Project
Project Number 42135-013
Country Papua New Guinea
Project Status Approved
Project Type / Modality of Assistance Loan
Technical Assistance
Source of Funding / Amount
Loan 2591-PNG: Pilot Border Trade and Investment Development Project
Asian Development Fund US$ 25.00 million
TA 7393-PNG: Trade and Investment Institutional Strengthening
Technical Assistance Special Fund US$ 900,000.00
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Governance and capacity development
Sector / Subsector Industry and trade - Trade and services
Gender Equity and Mainstreaming Some gender elements
Description The Project will remove the infrastructure bottleneck along the northern transport corridor connecting West Sepik Province (WSP) of Papua New Guinea and Papua Province of Indonesia, and improve the investment environment in WSP to enable WSP to capture trade opportunities for development. It will finance (i) the border facilitites at Wutung, (ii) consulting services for project implementation and construction supervision, (iii) capacity development, and (iv) a social development program including HIV/AIDS prevention.
Project Rationale and Linkage to Country/Regional Strategy WSP is one of the poorest provinces in PNG in terms of both economic and social development. However, it has potential to develop itself and drive the development of PNG's northern coastal region if it can capture the opportunities offered by Asia, particularly the neighboring Papua Province of Indonesia, which provides 25%-40% cheaper products and services and is in demand of PNG products.
Impact West Sepik Province (WSP) developed into a dynamic growth centre.
Project Outcome
Description of Outcome The outcome of the Project will be the improved business environment in WSP.
Progress Toward Outcome Progress is being monitored during project implementation.
Implementation Progress
Description of Project Outputs The Project will produce the following outputs: (i) border facilities including customs, immigration, and quarantine facilities; resident housing, and markets; (ii) Investment policy legislation for WSP approved and made effective;(iii) Telecommunication strategy for WSP developed and approved by the Government; (iv) Border Development Authority (BDA) office in Vanimo becoming a one-stop service office for promoting trade investment, and tourism for WSP;(v) Human capital base in the areas of trade and investment promotion, business entrepreneurship and administration, information technology, and Indonesian language proficiency broadened and; (vi) Human development in terms of health and education improved in five border villages
Status of Implementation Progress (Outputs, Activities, and Issues)

1) Border Administration Complex-The Contract was signed on 10 July 2012 and Contractor moblized key resources & staff on site. Actual work began in November 2012 after land issues were resolved by BDA and local authorities. Work is progressing well.

Border Administration Houses- contract was signed on 08 December 2011. The Contractor commenced work on 26 January 2012. The contracter completed construction and BDA took over the assets in March 2013.

BDA also signed the Design and Consultancy Supervision contract on 03 July 2012. Consultant has commenced work.

2) The Investment Policy Advisor submited the final report to DCI and BDA in December 2012. BDA (and DCI) to convene the Project Steering Committee to share the report and and focus on areas where immediate action is necessary.

3) A telecommunication advisor submitted his final Study for Telecommunication Strategy for WSP to BDA and DCI in June 2011. BDA & DCI to present the recommendations of the report to the Project Steering Committee to share with other relevant stakeholders & government agenices to decide on the most effective communication for new Border Building.

4) BDA has established a provincial office at the WSP Provincial Administration & the Provincial Coordinator is based full time in Vanimo. BDA will further recruit new staff after the construction of the new facilities under the project.

5) BDA signed the contracts for the Business Volunteer and Training Specialist in June 2012 and both consultants were moblized in the same month. The two consultants have submitted inception reports and are implementing the agreed action plans. The International Training Specialist has submitted a 2013 Annual Training Program to BDA & will implement the program in 2013.

6) BDA, with the support of financial consultant, has developed Modified Conditional Cash Trnsfers (MCCT) guidelines to implement the Social Development Program. ADB approved these guidelines in July 2011. Implemention of the following five interventions under the Social Development Program is in Progress.

i) Power Connection for Wutung Village Household: PNG Power limited has delivered the necessary materials and equipment needed for the power connection to Vanimo. The EA and PPL have agreed on the implementation of this activity.

ii) Construction of toilets for individual households and shared septic tanks: Under this intervention, the project will construct shared septic tanks and toilets to improve the environment and people's health. After discussions with the BDA, the community has agreed to a pipeline alignment & septic tank locations. The BDA will commence work with the villagers to construct 25 toilets and 4 septic tanks.

iii) Provision of School Fee Subsidy to at-risk children: Under this intervention, BDA provides financial assistance to at-risk children to encourage them to attend school up to grade 8. BDA has made payments to 11 at-risk children for this school year in March 2012 and BDA expects to make the payments in 2013 school year.

iv) Financial assistance to pregnant women for regular check-ups: Under this intervention the project will assist pregnant mothers to go for regular medical check-ups. The BDA made the first lot of payments to 9 pregnant mothers in March 2012. Since then the number has decreased because of traveling distance and associated problems. The community has agreed with BDA to renovate existing aid post in the village to provide clinical facilities for the pregnant mothers and also the whole community. The EA's consultant will prepare the scope, design and costs estimates for this facility.

v) HIV/AIDS Prevention: Under this intervention, the EA will support (i) public awareness, (ii) HIV Monitoring & detection. The improvement of the existing health facility in the community will be used for antenatal medical assistance, HIV/AIDS awareness, monitoring and detection and a also for a wide range of other health services.

Geographical Location Papua New Guinea
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples B
Summary of Environmental and Social Aspects
Environmental Aspects Yet to be assessed.
Involuntary Resettlement Yet to be assessed.
Indigenous Peoples Yet to be assessed.
Stakeholder Communication, Participation, and Consultation
During Project Design Extensive consultations with the relevant government agencies, provincial administration and project beneficiaries and potential affected parties have been carried out during project designs under project preparatory technical assistance.
During Project Implementation Consultations with various stakeholders are ongoing. Development of the investment legislation and telecommunication strategy for WSP will require further consultations with PNG national and provincial government, Papua provincial government of Indonesia, business communities on both sides, and donor agencies. Consultations on capacity building needs to (i) select training programs, (ii) select training institutes, and (iii) define candidate selection criteria is ongoing.
Business Opportunities
Consulting Services International and national consulting services will be required for (i) support to BDA and the PMO in the area of contract management, investment and tourism promotion, capacity development, and socioeconomic monitoring; (ii) construction supervision and environment monitoring; and (iii) HIV/AIDS prevention. The Project will fund a total of 350 person-months of consulting services (128 international; 222 national).
Procurement Civil works will be divided into two packages and will follow international competitive bidding (ICB) single-stage, one-envelope procedures, as the cost estimates for both contracts exceed $3 million-the ICB threshold for PNG. Equipment is grouped into eight packages. ICB will be followed for contracts estimated above $500,000. Contracts below $100,000 will following shopping procedures. National competitive bidding will be used for contracts between $100,000 and $500,000.
Responsible ADB Officer Muhammad Amir Ingratubun
Responsible ADB Department Pacific Department
Responsible ADB Division Papua New Guinea Resident Mission
Executing Agencies
Border Development AuthoritySomare Crescent-NDB Building
PO Box 216, WAIGANI 131
National Capital Dist., Papua New Guinea
Timetable
Concept Clearance 23 Jul 2009
Fact Finding 13 May 2009 to 29 May 2009
MRM 17 Aug 2009
Approval 27 Nov 2009
Last Review Mission -
Last PDS Update 21 Mar 2013

Loan 2591-PNG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
27 Nov 2009 28 Jan 2010 26 Mar 2010 30 Jun 2018 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 25.00 Cumulative Contract Awards
ADB 25.00 27 Nov 2009 21.31 0.00 90%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 27 Nov 2009 20.62 0.00 87%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - Satisfactory Satisfactory - - Satisfactory

TA 7393-PNG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
27 Nov 2009 04 Jan 2010 04 Jan 2010 31 Dec 2014 31 Dec 2015 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
900,000.00 0.00 160,000.00 0.00 0.00 0.00 1,060,000.00 27 Nov 2009 780,068.92
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - Satisfactory Satisfactory - - Satisfactory

Evaluation Documents

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