Regional: Facilitating Cross-Border Transport in the Central Asia Regional Economic Cooperation Region (Phase 1)

Sovereign Project | 46274-001

Summary

The proposed TA will help address nonphysical barriers to the efficient cross-border movement of goods and people in the CAREC region, which relate to legal, regulatory, administrative, documentary, organizational, and other hindrances that adversely affect the efficiency, speed, and cost of cross-border transport operations. This initiative is in line with the CAREC TTF Strategy and the operational priorities of transport and trade facilitation under CAREC 2020 (see item 11 above). It would help maximize the benefits of improved regional transport infrastructure being developed along the CAREC corridors.

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Project Name Facilitating Cross-Border Transport in the Central Asia Regional Economic Cooperation Region (Phase 1)
Project Number 46274-001
Country Regional
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8147-REG: Facilitating Cross-Border Transport in the Central Asia Regional Economic Cooperation Region (Phase 1)
Technical Assistance Special Fund US$ 300,000.00
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change
Sector / Subsector

Industry and trade - Industry and trade sector development

Transport - Transport policies and institutional development

Gender Equity and Mainstreaming
Description

The proposed TA will help address nonphysical barriers to the efficient cross-border movement of goods and people in the CAREC region, which relate to legal, regulatory, administrative, documentary, organizational, and other hindrances that adversely affect the efficiency, speed, and cost of cross-border transport operations. This initiative is in line with the CAREC TTF Strategy and the operational priorities of transport and trade facilitation under CAREC 2020 (see item 11 above). It would help maximize the benefits of improved regional transport infrastructure being developed along the CAREC corridors.

The proposed TA, which is the first phase of a planned series of TAs to help promote cross-border transport in the CAREC region, will help (i) identify key nonphysical barriers along priority CAREC transport corridors, (ii) formulate feasible approaches for addressing these key nonphysical barriers, and (iii) carry out important initial activities based on the agreed approaches. Subsequent phases will build on the results of the first phase, and, subject to satisfactory implementation of the first phase, will support other key activities in line with the agreed approaches, and provide similar support for other priority CAREC transport corridors.

The proposed TA will complement earlier ADB technical assistance to CAREC countries on transport facilitation, trade facilitation and customs modernization including: (i) the Regional Trade Facilitation and Cooperation Program (2002-2006) in KGZ and TAJ through Loans 1926-KGZ and 1927-TAJ ($15 million and $10 million, respectively); (ii) Regional Customs Modernization and Infrastructure Development Project (2005-present) KGZ and TAJ, through Loan 2113-KGZ and Loan 2114-TAJ ($7.5 million and $10.7 million, respectively). ; (iii) TA 6437-REG: Integrated Trade Facilitation Support for Central Asia Regional Economic Cooperation (2007-present; $3.0 million); (iv) TA 6203-REG: Regional Trade Facilitation and Customs Cooperation (Phase II, 2004-2009, $900,000); (v) TA 7775-REG: Preparing the CAREC Transport and Trade Facilitation Project: Border Crossing Point Improvement and Single Window Development (2011-2012; $2 million); and (vi) TA 6223-REG: Formulating and Implementing an Intergovernmental Agreement of the Shanghai Cooperation Organization Member States on Facilitation of International Road Transport (2005-2008; $500,000).

CAREC countries have been receiving assistance in transport facilitation and trade facilitation from development partners, including the Border Management Programme in Central Asia (BOMCA, financed by the European Commission, and executed by the United Nations Development Programme), the Organization for Security and Co-operation in Europe (OSCE), and the United States.

Project Rationale and Linkage to Country/Regional Strategy

Better connectivity and progress toward energy efficiency, security and trade have always been key intended results of the CAREC Program. Improved transport linkages cuts the cost of doing business, creates good conditions for larger trade flows, brings people closer to markets and social services, and ultimately becomes a means to accelerate economic growth. This was underscored in the CAREC Transport and Trade Facilitation (TTF) Strategy endorsed by the CAREC member countries at the Sixth Ministerial Conference in Dushanbe, Tajikistan in 2007, with its action plan approved at the Seventh Ministerial Conference in Baku, Azerbaijan in 2008. An assessment of transport and trade indicators along CAREC corridors conducted from April 2009 to March 2010 revealed that the average time to clear at a border crossing point (BCP) was 21.3 hours; average cost at a BCP was $398.60; average speed for a 20-ton truck or twenty-foot equivalent unit (TEU) container to travel 500 kilometers (km) along a CAREC corridor section was 30 kilometers per hour (kph) without delay and 16 kph with delay; and the average cost to travel along a corridor section was $1,166.

Transport facilitation pursues a more efficient movement through borders by removing nonphysical barriers, which relate to legal, regulatory, administrative, documentary, organizational, and other hindrances that adversely affect the efficiency, speed, and cost of cross-border transport operations. These barriers needlessly increase transport costs, and consequently the price of raw materials and commodities. In extreme cases, these barriers prohibit cross-border transport of goods, people and services completely. The new 10-year strategic framework for CAREC (CAREC 2020), which was endorsed by the member countries in November 2011, emphasizes the importance of transport and trade facilitation in the achievement of its strategic objectives of expanded trade and improved competitiveness.

There are many cross-border transport facilitation agreements/arrangements involving CAREC member countries designed to mitigate the nonphysical barriers to the smooth transnational movement of goods and people between and among them. These include international transport facilitation conventions (to which many CAREC countries are contracting parties), plurilateral agreements (e.g., agreements under the Transport Corridor Europe Caucasus Asia [TRACECA] Program, Economic Cooperation Organization [ECO], Shanghai Cooperation Organization [SCO]), and bilateral agreements. Progress in finalizing and implementing these arrangements has been varied and generally slow. Considering CAREC's goal of establishing competitive transport corridors in the region, and given the slow progress on many of the cross-border transport agreements/arrangements, CAREC senior officials agreed at their meeting in Beijing in September 2011 that a pragmatic and step-by-step approach to implementing transport facilitation agreements for CAREC corridors could be considered.

Impact Enhanced cross-border transport along CAREC corridors
Project Outcome
Description of Outcome Implementation of transport facilitation arrangement(s) commenced
Progress Toward Outcome The Cross Border Transport Agreement (CBTA) among the Kyrgyz Republic, Tajikistan and Afghanistan was initiated by ADB. The CBTA seeks to establish the legal foundation for simplifying and facilitating the transport and transit of goods and people along CAREC corridors. Two consulting teams were engaged to investigate implementation challenges in cross-border transport facilitation agreements, including the CBTA. Reports and recommendations were prepared and presented in AFG, PAK, TAJ and KYR Q4 2014.
Implementation Progress
Description of Project Outputs

1. CAREC countries agree on feasible approaches to mitigate nonphysical barriers to cross-border transport along CAREC corridors.

2. Required transport facilitation arrangements are identified and prepared for implementation.

Status of Implementation Progress (Outputs, Activities, and Issues)

1. Two consulting teams were engaged to undertake diagnostic studies and facilitate collection of data and information to the proposed work involved in the cross-border transport facilitation in Central Asia.

2. On 27 March a round table was conducted to support further integration of Pakistan with other member countries of CAREC. Analysis of trade flows between Pakistan and other CAREC countries, and of the structure and operations of the transport sector as relevant to the trade flows will continue during March-April 2014.

3. A diagnostic study of cross border transport legal arrangements and operational bottlenecks along CAREC Corridor 5 (section: Kyrgyz Republic - Tajikistan/ - Afghanistan) was completed (September 2014).

4. A diagnostic study of cross border transport legal arrangements and operational bottlenecks along CAREC Corridor 5 (section: Pakistan - Afghanistan) was completed (September 2014).

5. Results and recommendations of the studies were presented to Government and private sector stakeholders in Afghanistan and Pakistan in November 2014, and in Kyrgyz Republic and Tajikistan in December 2014.

Request for major change in TA scope and cancellation of surplus funds was approved on 30 September 2014. The TAs uncommitted funds will be used for the remaining activity in support for output 1 to organize subregional workshops and series of meetings to finalize and disseminate diagnostic studies. Activities under output 2 were cancelled. The revised budget for the TA is $300,000. The reduction in TA scope resulted in a surplus of TA funds of $1.2 million.

Geographical Location Kyrgyz Republic,Mongolia,Pakistan,People's Republic of China,Kazakhstan,Afghanistan,Uzbekistan,Tajikistan,Turkmenistan,Azerbaijan
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design The need for accelerated action on trade facilitation was extensively discussed at several meetings of CAREC senior officials and the CAREC transport sector coordinating committee (TSCC). At the meeting of CAREC National Focal Points in Beijing in September 2011, they agreed on the need to conduct seminars and workshops on experience of CAREC countries as well as international experience on transport facilitation with a view to facilitating the cross-border transport of goods and people along the CAREC transport corridors.
During Project Implementation The TA will be monitored principally through the meetings of the CAREC senior officials and the TSCC, as well as national and regional meetings to be held under the auspices of the TA. Evaluation of the TA's outputs will be carried out by the CAREC Unit through the annual TA implementation review mission with the assistance of the respective RMs and the CAREC National Focal Points. The TA implementation will also be reviewed during CAREC Senior Officials' Meetings, which are held at least twice each year.
Business Opportunities
Consulting Services Implementing the TA will require about 20 person-months of international consultancy from one TTF specialist (18 person-months) and short-term experts and resource persons (2 person-months combined) and about 106 person-months of national consultancy from three legal specialists (18 person-months combined), four TTF specialists (48 person-months combined), and one CAREC transport facilitation analyst (40 person-months). Consultants will be engaged as individuals because (i) the tasks to be undertaken and the countries of origin of the consultants are diverse, (ii) CAREC national focal points are expected to be actively involved in implementing the TA and coordinating with CAREC as a whole, and (iii) CWRD staff will actively manage TA implementation. The consultants will be engaged by ADB in accordance with its Guidelines on the Use of Consultants.
Procurement Some office and telecommunication equipment may be procured by ADB in accordance with ADB's Procurement Guidelines.
Responsible ADB Officer Oleg Samukhin
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Transport and Communications Division, CWRD
Executing Agencies
Asian Development Bank6 ADB Avenue, Mandaluyong
Metro Manila, Philippines
P.O. Box 789, 1099 Manila,
Philippines
Timetable
Concept Clearance 28 Jun 2012
Fact Finding -
MRM -
Approval 24 Aug 2012
Last Review Mission -
Last PDS Update 13 Mar 2015

TA 8147-REG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
24 Aug 2012 - 24 Aug 2012 31 Dec 2015 - -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
300,000.00 0.00 0.00 0.00 0.00 0.00 300,000.00 24 Aug 2012 194,306.36

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